Fagundes & Perzanowski: A new framework for conceptualizing the end of IP rights

 Dave Fagundes and Aaron Perzanowski have just posted a very interesting and thought-provoking paper draft on SSRN called "How Intellectual Property Ends."  

The paper, which follows up on their prior work on copyright abandonment, closely examines how IP rights come to an end through doctrines like "expiration," "forfeiture," or "abandonment." The paper seeks to provide a “taxonomy” for thinking about how IP rights end. The authors argue that imprecise or inconsistent uses of terms like "abandonment" and "forfeiture” deprives these terms of meaning and “obscures the underlying logic” of the doctrines as originally developed at common law (5). They instead posit a single unified framework for consistently conceiving of termination that can work across the four IP regimes. 

Too Much of a Good Thing: Jake Linford on Copyright & Attention Scarcity

In his fascinating 2020 article in Cardozo Law Review, entitled Copyright and Attention Scarcity, Jake Linford provided a new justification for copyright law's barriers against derivative content—saving the overtaxed attention spans of copyrights' beleaguered audience. If readers and viewers got as much unauthorized derivative works as they wanted, Linford suggested, they would be unable to find the time and energy to read, watch, and sort through all of the derivatives available to them.  By giving original authors the right to control derivative works, copyright law protects the audience from content overload.  

I loved the article and really appreciated Linford's creative use of the literature on "attention scarcity." That said,  as a viewer and reader, I am not sure I like where the thesis leaves me. Speaking for myself, when I am tired and overloaded, the last thing I want is more originals. I want to return to my old favorites through a new lens; I want a sequel, a prequel, or a re-make. Whether these derivatives are authorized or un-authorized matters less to me than whether they are familiar and easy to get into without a lot of legwork. (I do want to know whether the content is made by or authorized by the original creator. But trademark law protects consumers from being misled as to source. Thanks to trademark law, I would know when the newest Star Wars is authorized by Disney and when it's not.)

I am about three years behind with this post.  My excuse, besides the pandemic, is that I felt it necessary to watch all seasons of Cobra Kai, along with the films in the original Karate Kid franchise, plus the entire library of Disney Plus, to fully research a response.

Guy Rub: Copyright or Contract?

Using software often means you have to sign a contract as a condition for using the software. This "end user license agreement," called a EULA, will lay out the terms under which the software can be used. For example, the EULA you sign to play a video game might say: "The player of this video game cannot cheat while playing the game."  What if you breach the EULA by playing the game using a commercially available cheating "bot"?  Is this copyright infringement? Or is this just a breach of contract?  This may seem obscure, but the question matters a lot.  For one thing, in this example, if the video game publisher has a copyright claim against the cheater, not just a contract claim, this could mean very large statutory damages versus no damages at all.

This is just one of many scenarios in which copyright owners use contracts to control the conditions of use, and whose breach may, or may not, give rise to copyright infringement. In his new article, Against Copyright Customization, Guy Rub addresses this thorny question—copyright or contract?—along with many closely related questions. For example: when is a software user a mere licensee versus an owner?  (Spoiler alert:  almost always!)  The article is forthcoming in Iowa Law Review and a draft can be downloaded on SSRN.

I interviewed Guy about the article. Here is a transcription.

Google v. Oracle - The Final Shoe Drops

The Supreme Court ruled yesterday in Google v. Oracle that Google did not infringe Oracle's copyright in its APIs by virtue of fair use. The vote was 6-2, with Justice Breyer writing for the Court, and Justices Thomas and Alito dissenting. 

The opinion was straightforward and went to great lengths to attempt to explain the technology at issue. I thought it did a decent job of it (definitely more Godot than Guffman), even as the opinion continued to struggle for a good analogy. The Court adopted the file cabinet/drawer/folder analogy presented in Google's brief, which I thought was a terrible analogy...so I guess there's no accounting for taste (or winning advocacy). The court's fair use analysis was influenced by Judge Boudin's concurrence in Lotus v. Borland, though that concurrence didn't actually call it fair use, but instead "privileged use."

Others have and will surely write about the fair use aspects and what this means for software APIs. Contrary to Oracle's ridiculous and vitriolic press statement yesterday, this case will likely not change the way anyone in the industry behaves in the least. APIs have been used and reused for decades, and will continue to be. And contrary to being a barrier to entry, reuse of APIs allows for competitive inroads and entry, including by Oracle, in its mimicry of Amazon's AWS API. (Indeed, the hubris of Oracle's statement in light of its implementation of another company's API is stunning, assuming it was unlicensed-I've been unable to verify one way or the other.)  

The opinion also has some nuggets for other fair use - discussion of transformation and art, definition of markets for determining harm, another reaffirmation of Campbell v. Acuff-Rose Music, fair use as a mixed question of law and fact (something I discussed in a prior blog post), and so forth.

Instead, I will focus on my hobby horse-whether the APIs are copyrighted, and if so how we get to non-infringement. The Supreme Court explicitly decided that the copyrightability of APIs is a third-rail and did not attempt to touch the issue. There are two ways to read the tea leaves. First, perhaps a majority of the court thought they were uncopyrightable, but feared the effects of saying so. Second (and my guess), perhaps a majority of the court (or a 4-4 split) thought that they were copyrightable, but fair use was an acceptable compromise. The second possibility is why I wrote and submitted my amicus brief, which was intended to give a path to non-infringement even if the APIs were copyrightable.

Alas, the court did not buy into the abstraction/filtration argument I made, which I believe was doctrinally appropriate, nor did the brief get a cite, as many that discussed the importance of APIs did. However, in a sense, the court adopted the methodology I suggested. From my brief:

But the copyrightability of an entire work does not answer the question of whether any particular portion of it, if used by another, is infringing. That analysis requires determining whether the defendant has taken too much expression and not ideas, systems, methods of operation, or the like. And such a determination cannot be made outside of the infringement analysis. Any functionally required aspects—including any expression necessary to practice the idea—should be removed from the comparison. 

What remains should then be compared. The advantage of this approach is that it recognizes that while entire software programs may be copyrightable in some contexts, their pieces might not be infringed in others. There need be no zero-sum game, but only a recognition that the scope of copyright depends, as it always has, on the accused’s use of the copyrighted work. 

...

[T]he Court need not decide whether any part of Oracle’s code is copyrightable standing alone. It should only determine that the scope of its copyright in the Java source code cannot extend to infringement through the reuse of declaring functions necessary to create a compiler or interpreter that accepts the same commands and parameter names to allow programmers to use the Java programming language.

The primary pushback on this argument that I received from smart colleagues asked this question: why should context matter in the infringement analysis? Justice Thomas's dissent is replete with this same concern. My answer was always the same - because use in a functional context may be a use of the idea/method, whereas use in a different context might not be.

But Justice Breyer has sidestepped this question to essentially reach the same result using fair use. The one place where we can be sure that context matters is fair use. The nature and character of the use is one of the factors, after all. The Court's analysis tracks many of the same issues in my brief - the functionality of the APIs, their use as a de facto standard, switching costs, etc.

And so the Court's final resolution is not that far off from what I had asked. Rather than excluding the APIs from infringement by filtering them out, the Court would instead exclude them from infringement under a fair use analysis that considers many of the same factors. I can live with this solution--way back in 1999, I published a paper that argued that "courts have been able to determine efficient economic outcomes based on the cases before them, but they have been unable to settle on a rule that definitely determines how much reuse to allow in each case." The article lays out a variety of economic factors that predict how cases come out, and you'll be shocked to find out that they favor Google in this case (e.g. switching costs, de facto standards, lack of slavish copying of the implementation, no breach of an underlying economic duty, public benefits of compatibility). Perhaps that's a reason this case has stuck in my craw for so long: it's about the only one that didn't fit with my 20+ year old model.

Despite my doctrinal sanguinity, the downside of the court's approach is that it might still lead to framing issues in the future. Litigants might still be subjected to juries asked to simply decide whether the APIs were used (for infringement) and then hope to rely on fair use as a defense. Then again, a judicial fair use inquiry might keep the question from ever getting to a jury, which is basically the same result I've advocated. But this case went to a jury, by appellate order, and it's unclear that it should have. It was certainly costly. However, the strong language of this opinion may apply the next time, as in the case I recently blogged about with control codes.

The end is near for my Oracle and Google blogging, a 9 year expedition. But I do have one more in me, a more technical post in a week or so about the so-called 170 lines of code that supposedly all that are necessary to implement Java.

Charles Tait Graves: Idea Submission Cases, Desny Claims, and Trade Secret Law

I thoroughly enjoyed Charles Tait Graves new article: Should California’s Film Script Cases Be Merged into Trade Secret Law?, which was recently published in The Columbia Journal of Law & the Arts.  Graves is a partner at Wilson Sonsini and teaches trade secret law at UC Hastings Law.   

The article deals with so-called "idea submission" cases. The fact pattern is as follows. Plaintiff, who is sometimes called the "idea man" in older cases, shares an idea with Defendant, hoping for monetary compensation even though there's no express contract stating terms of payment. Defendant subsequently takes the idea and commercializes it without paying Plaintiff. (There's an excellent discussion of the idea submission cases in Chapter 4 of Elizabeth Rowe and Sharon Sandeen's Trade Secret Law casebook). 

At least in California, the Plaintiff-idea person will likely have two distinct types of legal claims in this scenario: (1) a claim for breach of an implied-in-fact contract, which in California is called a Desny claim; and (2) a claim for civil trade secret misappropriation, which since 2016 can be brought under both state law (e.g. under the California Uniform Trade Secret Act) and federal law via the Defend Trade Secrets Act (DTSA). Graves recounts in tremendous detail how these two different legal regimes developed on separate ends of the map of California, in Southern and Northern California, respectively. Graves' thesis is that, even though these two areas of law have been historically addressed separately, they have a lot in common and can learn a lot from one another.   

I interviewed Graves about the article, transcribed below.

Google v. Oracle and the search for an analogy

I had the pleasure of listening to the Supreme Court oral argument in near real-time from the comfort of my desk last Wednesday, one of the few positives to come out of this pandemic. There's a lot to say about it, but I won't do a full recap here or make any predictions. I'll likely follow-up after the opinion.

But one thing that struck me was the Court's struggle to find an analogy. I'm not the only person to point this out, of course, because it was palpable. Google used a filing cabinet as an analogy in its briefing, and that fell flat, never mentioned during argument. Other analogies, including essential facilities, football playbooks, qwerty keyboards, telephone switchboards, and grocery organizations had varying degrees of success in capturing the issues at play in the case.

It occurred to me that perhaps an appropriate analogy would have been a remote control - this is something that uses APIs, but that the Court could have wrapped its collective mind around. 

Consider a television set. It has an infrared detector that receives various a series of pulses that coincide with different functions: on, off, volume up, volume down, input selection, etc. The remote control has a list of these commands built into its memory. When the appropriate button is pressed, a lookup command finds the proper set of pulses, and sends them. I realize that this may be done via hardware, but not necessarily and even if so, the analogy still works to illustrate the consequences.

Let's assume now that this group of pulses took some creativity. There was a lot of work to make sure that the pulses didn't match other devices, and they could have been created any other way. But this collection of pulses is original, even highly so.

Now, along comes your cable box, and you want to turn the channel on cable, while powering on your TV and changing the TV's volume using a single remote. We've all been there, right? In order to do this, the cable box remote must include a collection of the pulses needed to do those things. Indeed, it will need the collection of pulses from every television manufacturer. Mind you, not every pulse will be needed. Cable box remotes won't have a "setup" button, for example. The universal remote can generate the compatible pulses in any number of ways, but the pulses will always be the same, or else the remote won't work.

What if the TV manufacturer says that its pulses are protected by copyright? It's not far-fetched. the pulses are 10011101001 - original expression. The longer the pulse, the more likely it is to be original. Should it be able to stop cable box manufacturers from including the list of pulses in its remote controls? Should it be able to stop competing televisions (or maybe sound bar makers) from including a list of those pulses so that a single volume change affects multiple devices at once?

Now this, I suggest, is an analogy that the Court can get its arms around. I am certain that every justice has worked a remote control, and a universal remote control. I would posit that most of them know how very different the world is when you have 5 different remote controls--one for each device--rather than a single universal remote.

This analogy, I submit, brings into focus the competing policy arguments. Google argues that competing remote control manufacturers must be able to have a list of all the pulse commands in their programming if they are to communicate with the TV.  It doesn't really matter how famous the TV is - if the TV maker gets to own the collection of pulses, then society is left with only one remote control possibility. Further, if other device makers cannot include the list of pulses to work with the TV's remote--and so only the TV maker can make devices that work with its remote--then consumers must use a different remote if they want to turn up the stereo or sound bar with a remote control.

Oracle, on the other hand, says that its collection of pulses, being original, is owned by the TV manufacturer, and as a result universal remotes and compatible sound bars are just riding its coattails. People are free to make up their own collection of pulses, but if that means nobody's remote control works with its TV's and nobody can used its remote control on competitor sound bars or televisions, that's just fine.

When put this way, I think the issue comes into stark resolution. 

• Was copyright meant to regulate remote control compatibility, even if the collection of pulses is original? I don't think so. 
• Is the sending of a message to turn up the volume from a remote control to a television a method of operating the television, not withstanding the originality of the pulse collection? Yes - the pulse is making the television do something. 
• Does allowing sound bar manufacturers (and even rival television manufacturers) to reuse the pulse collection so that they can respond to pulse commands from the original TV remote put the copyrightability of all the other original and creative functionality inside the original TV at risk?  No. APIs really are different. 
• Does this fit into copyright doctrine? Yes. As I noted in my amicus brief, the TV manufacturer is entitled to copyright protection in all of its code, including the collection of pulses. But when the pulses are reused to obtain a functional goal - namely remote to television compatibility, then we should filter them out. Whether you call it merger, idea/expression, or method of operation doesn't really matter. From a doctrinal point of view, we are saying that the commands necessary for one device/program to control another cannot be asserted as part of the copyright scheme. In Baker v. Selden, the court was clear that such use is allowed, even if copying of some expression is incident to it.
  

In sum, it is maddening to me how little mention Bateman v. Mnemonics has received in this case and its briefing. That case, decided at about the same time as Lotus v. Borlad 25 years ago, deals with nearly identical issues as this case, and quite easily disposes of the issues by filtering out common interface as function in an infringement analysis. 

As I note in my brief: "According to Westlaw, Bateman is cited in nearly 1/3 more cases than Lotus about (240:170), but only in about half as many secondary sources (about 450:950)." In other words, the straightforward application of filtration is not as sexy as ruling something is completely uncopyrightable as a method of operation. But it makes a whole lot more sense to courts, who have been using the methodology for nearly 25 years.

 

Google v. Oracle: Amicus Briefing

Hello again, it's been a while. My administrative duties have sadly kept me busy, limiting my blogging since the summer. But since I've blogged consistently about Google v. Oracle (fka Oracle v. Google) about every two years, the time has come to blog again.

I won't recap the case here -my former post(s) do so nicely. I'm just reporting that 20+ amicus briefs were filed in the last week, which SCOTUSblog has nicely curated from the electronic filing system.

There are many industry briefs. They all say much the same thing - an Oracle win would be bad for industry, and also inconsistent with the law (The R Street brief -and prior op ed-describes how Oracle has copied Amazon's cloud based API declarations). But since I'm an academic, I'll focus on those briefs:

1. Brief of IP Scholars (Samuelson & Crump): Merger means that the API declarations cannot be protected
2. Brief of IP Scholars (Tushnet): Fair Use is warranted
3. Brief of Menell, Nimmer, Balganesh: Channeling dictates that API declarations are not protected
4. Brief of Lunney: Infringement only occurs if whole work is copied; protection does not promote the progress
5. Brief of Snow, Eichhorn, Sheppard: Fair Use jury verdict should not be overturned
6. Brief of Risch: Protection should be viewed through the lens of abstraction, filtration, and comparison

My brief is listed last, but it's certainly not least. Indeed, I think it's a really good brief. But of course I would say that. If you've read my prior blog posts on this (including the one linked above), you'll note that my brief puts into legal terms what I've been complaining about for eight or so years: by framing this case as a pure copyrightability question, the courts have lost sight of the context in which we consider the protection of the API declarations. There might be a world where the declarations, if published as part of a novel and reprinted in a pamphlet made by Google, are eligible for copyright registration. But in the context of filtration, which neither the district court nor the Federal Circuit performed, the declarations are not the type of expression that can be infringed by a competing compiler. Give it a read. It's better than Cats (and not just the new movie), you'll read it again and again.

An even better summary of all the briefs is here.

I conclude with a paragraph from the brief, which I think sums things up:

This case boils down to [the] question: can a company own a programming language through copyright? Oracle would say yes, but the entire history of compatible language compilers, compatible APIs, compatible video games and game systems, and other compatible software says no. Michael Risch, How Can Whelan v. Jaslow and Lotus v. Borland Both Be Right? Reexamining the Economics of Computer Software Reuse, 17 The J. Marshall J. Info. Tech. & Priv. L. 511, 539–44 (1999) (analyzing economics of switching costs, lock-in, de facto standards, and competitive need for compatibility).

Jacob Victor: Should Royalty Rates in Compulsory Licensing of Music Be Set Below the Market Price?

Jacob Victor has a remarkable new article on copyright compulsory licenses, forthcoming in the Stanford Law Review. The article boldly wades into the notoriously convoluted history of the compulsory license option for obtaining rights to copyrighted music, and makes what I think is a very interesting and important normative argument about how compulsory license rates should be set.  Other scholars who have written on compulsory licensing, whose work Victor addresses, include, to name only a few: Kristelia Garcia, Jane C. Ginsburg, Wendy Gordon, Lydia Pallas Loren, Robert P. Merges, Pam Samuelson, Tim Wu, and more herein.

Making Sense of Unequal Returns to Copyright

Typically, describing an article as polarizing refers to two different groups having very different views of an article. But I read an article this week that had a polarizing effect within myself. Indeed, it took me so long to get my thoughts together, I couldn't even get a post up last week. That article is Glynn Lunney's draft Copyright's L Curve Problem, which is now on SSRN. The article is a study of user distribution on the video game platform Steam, and the results are really interesting.

The part that has me torn is the takeaway. I agree with Prof. Lunney's view that copyright need not be extended, and that current protection (especially duration) is overkill for what is needed in the industry. I disagree with his view that you could probably dial back copyright protection all the way with little welfare loss. And I'm scratching my head over whether the data in his paper actually supports one argument or the other. Here's the abstract:

No one ever argues for copyright on the grounds that superstar artists and authors need more money, but what if that is all, or mostly all, that copyright does? This article presents newly available data on the distribution of players across the PC videogame market. This data reveals an L-shaped distribution of demand. A relative handful of games are extremely popular. The vast majority are not. In the face of an L curve, copyright overpays superstars, but does very little for the average author and for works at the margins of profitability. This makes copyright difficult to justify on either efficiency or fairness grounds. To remedy this, I propose two approaches. First, we should incorporate cost recoupment into the fourth fair use factor. Once a work has recouped its costs, any further use, whether for follow-on creativity or mere duplication, would be fair and non-infringing. Through such an interpretation of fair use, copyright would ensure every socially valuable work a reasonable opportunity to recoup its costs without lavishing socially costly excess incentives on the most popular. Second and alternatively, Congress can make copyright short, narrow, and relatively ineffective at preventing unauthorized copying. If we refuse to use fair use or other doctrines to tailor copyright’s protection on a work-by-work basis and insist that copyright provide generally uniform protection, then efficiency and fairness both require that that uniform protection be far shorter, much narrower, and generally less effective than it presently is.

The paper is really an extension of Prof. Lunney's book, Copyright's Excess, which is a good read even if you disagree with it. As Chris Sprigman's JOTWELL review noted, you either buy in to his methodology or you don't. I discuss below why I'm a bit troubled.

The Rise and Rise of Transformative Use

I'm a big fan of transformative use analysis in fair use law, except when I'm not. I think that it is a helpful guide for determining if the type of use is one that we'd like to allow. But I also think that it can be overused - especially when it is applied to a different message but little else.

The big question is whether transformative use is used too much...or not enough. Clark Asay (BYU) has done the research on this so you don't have to. In his forthcoming article in Boston College Law Review called, Is Transformative Use Eating the World?, Asay collects and analyzes 400+ fair use decisions since 1991. The draft is on SSRN, and the abstract is here:

Fair use is copyright law’s most important defense to claims of copyright infringement. This defense allows courts to relax copyright law’s application when courts believe doing so will promote creativity more than harm it. As the Supreme Court has said, without the fair use defense, copyright law would often “stifle the very creativity [it] is designed to foster.”

In today’s world, whether use of a copyrighted work is “transformative” has become a central question within the fair use test. The U.S. Supreme Court first endorsed the transformative use term in its 1994 Campbell decision. Since then, lower courts have increasingly made use of the transformative use doctrine in fair use case law. In fact, in response to the transformative use doctrine’s seeming hegemony, commentators and some courts have recently called for a scaling back of the transformative use concept. So far, the Supreme Court has yet to respond. But growing divergences in transformative use approaches may eventually attract its attention.

But what is the actual state of the transformative use doctrine? Some previous scholars have empirically examined the fair use defense, including the transformative use doctrine’s role in fair use case law. But none has focused specifically on empirically assessing the transformative use doctrine in as much depth as is warranted. This Article does so by collecting a number of data from all district and appellate court fair use opinions between 1991, when the transformative use term first made its appearance in the case law, and 2017. These data include how frequently courts apply the doctrine, how often they deem a use transformative, and win rates for transformative users. The data also cover which types of uses courts are most likely to find transformative, what sources courts rely on in defining and applying the doctrine, and how frequently the transformative use doctrine bleeds into and influences other parts of the fair use test. Overall, the data suggest that the transformative use doctrine is, in fact, eating the world of fair use.

The Article concludes by analyzing some possible implications of the findings, including the controversial argument that, going forward, courts should rely even more on the transformative use doctrine in their fair use opinions, not less.

In the last six years of the study, some 90% of the fair use opinions consider transformative use.*  This doesn't mean that the the reuser won every time - quite often, courts found the use to not be transformative. Indeed, while the transformativeness finding is not 100% dispositive, it is highly predictive. This supports Asay's finding that transformativeness does indeed seem to be taking over fair use.

Jiarui Liu on the Dominance and Ambiguity of Transformative Use

The Stanford Technology Law Review just published an interesting new copyright article, An Empirical Study of Transformative Use in Copyright Law by Prof. Jiarui Liu. Here is the abstract:

This article presents an empirical study based on all reported transformative use decisions in U.S. copyright history through January 1, 2017. Since Judge Leval coined the doctrine of transformative use in 1990, it has been gradually approaching total dominance in fair use jurisprudence, involved in 90% of all fair use decisions in recent years. More importantly, of all the dispositive decisions that upheld transformative use, 94% eventually led to a finding of fair use. The controlling effect is nowhere more evident than in the context of the four-factor test: A finding of transformative use overrides findings of commercial purpose and bad faith under factor one, renders irrelevant the issue of whether the original work is unpublished or creative under factor two, stretches the extent of copying permitted under factor three towards 100% verbatim reproduction, and precludes the evidence on damage to the primary or derivative market under factor four even though there exists a well-functioning market for the use.

Although transformative use has harmonized fair use rhetoric, it falls short of streamlining fair use practice or increasing its predictability. Courts diverge widely on the meaning of transformative use. They have upheld the doctrine in favor of defendants upon a finding of physical transformation, purposive transformation, or neither. Transformative use is also prone to the problem of the slippery slope: courts start conservatively on uncontroversial cases and then extend the doctrine bit by bit to fact patterns increasingly remote from the original context.

This article, albeit being descriptive in nature, does have a normative connotation. Courts welcome transformative use not despite, but due to, its ambiguity, which is a flexible way to implement their intuitive judgments yet maintain the impression of stare decisis. However, the rhetorical harmony conceals the differences between a wide variety of policy concerns in dissimilar cases, invites casual references to precedents from factually unrelated contexts, and substitutes a mechanical exercise of physical or purposive transformation for an in-depth policy analysis that may provide clearer guidance for future cases.

This article builds on and extends prior empirical work in this area, such as Barton Beebe's study of fair use decisions from 1978 to 2005. And it provides a nice mix of interesting new empirical results and normative analysis that illustrates why fair use doctrine is (at least for me) quite challenging to teach. For example, Figure 1 illustrates how transformative use has cannibalized fair use doctrine since the 1994 Campbell v. Acuff-Rose decision endorsed its use:

Liu also examines data such as the win rate for transformative use over time, by circuit, and by subject matter. But I particularly like that Liu is not just counting cases, but also arguing that courts are using this doctrine as a substitute for in-depth policy analysis.

The Copyright Law of Interfaces

Winter break has ended and so, too, has my brief blogging break. I've blogged before (many times) about the ongoing Oracle v. Google case. My opinion has been and continues to be that nobody is getting the law exactly right here, to the point where I may draft my own amicus brief supporting grant of certiorari. But to the extent I do agree with one of the sides, it is the side that says API (Application Programming Interfaces) developers must be allowed to reuse the command and parameter structure of the original API without infringing copyright. My disagreement is merely with the way you get there. Some believe that API's are not copyrightable at all. I've blogged before that I'm not so sure about this. Some believe that this should be fair use. I think this is probably true but the factors don't cleanly line up. My view is that this should be handled on the infringement side: that API's, even if copyrightable, are not infringing when used in a particular way (that is, they are filtered out of an infringement analysis). It's the same result, but (for me, at least) much cleaner theoretically and doctrinally.

But make no mistake, this sort of reuse is critically important, as Charles Duan (R Street Institute) points out in his latest draft: Internet of Infringing Things: The Effect of Computer Interface Copyrights on Technology Standards (forthcoming in Rutgers Computer and Technology Law Journal). The draft is on SSRN and an abstract is here:

This article aims to explain how copyright in computer interfaces implicates the operation of common technologies. An interface, as used in industry and in this article, is a means by which a computer system communicates with other entities, either human programmers or other computers, to transmit information and receive instructions. Accordingly, if it is copyright infringement to implement an interface (a technical term referring to using the interface in its expected manner), then common technologies such as Wi-Fi, web pages, email, USB, and digital TV all infringe copyright.

By reviewing the intellectual property practices of the standard-setting organizations that devise and promulgate standards for these and other communications technologies, the article demonstrates that, at least in the eyes of standard-setting organizations and by extension in the eyes of technology industry members, implementation of computer interfaces is not an infringement of copyright. It concludes that courts should act consistent with these industry expectations rather than upending those expectations and leaving the copyright infringement status of all sorts of modern technologies in limbo.

 As noted, I agree with the end result, so any critique here should be taken as one of the paper, and not of the final position. I think Duan does a very nice job of explaining what an interface is: namely, the set of commands that third-party programmers send to a server/system to make it operate. There is value in standardization of these interfaces - it allows people to write one program that will work with multiple systems. Duan uses two good examples. The first is HTML/CSS programming, which allows people to write a single web document and have it run in any browser and/or server that supports the same language. The second is SMTP, which allows email clients to communicate with any email server. The internet was built on these sorts of interfaces, called RFCs.

Duan then does a nice job of showing the creativity that goes into selecting the commands - as with Java, there were choices (though limited) to make about each command. Because the set of functions is limited, number of ways to describe the function is limited, but there are some choices to be made. The article then shows how those commands are grouped together in functional ways.

Finally, Duan nicely shows how many important standards are out there that follow this same pattern, and shows how standards organizations handle any copyright--they don't. In short, allowing contributors to claim copyright ownership would destroy systems, because there is no requirement that contributors allow others to use the interface. Duan's concern is that if individual authors owned the IP in their interface contributions to standards (a potential extension of Oracle v. Google) then holdup might occur that harms adoption. This, of course, is hotly debated, as it is in the patent area.

I think it's a really interesting and well-written paper. Before I get to a couple critiques, I should note that Duan is focused more on how the current legal8 rulings might affect standards than critiquing the rulings themselves (as I have done here). Thus, my comments here may simply not have been on his radar.

My primary thought reading this is that the paper doesn't deal with the declaring code. That is, in order to implement the Java commands, Google created short code blocks that defined the functions, the parameters, etc.  Here is an example from the original district court opinion:

package java.lang;
java.lang public
class Math {
class Math public static int max (int x, int y) {

This code is what the jury found to be copied (though presumably Google wrote it in some other language). But the standards interfaces don't provide any code, per se. They only provide explanations. Here is an example definition from the RFC for the SMTP protocol discussed in the paper:

mail = "MAIL FROM:" Reverse-path

In other words, standards will define the commands that must be sent, but there's not a language based implementation (e.g. public, static, integer, etc.). As with the sample line above. Most say: send x command to do y. And people writing software are on their own to figure out how to do that. And you can bet the implementing code looks very similar, but there's something different about how it is specified at the outset (a full header declaration v. a looser description). So, the questions this raises are a) does this make standards less likely to infringe, even under the Federal Circuit's rules (I think yes), and b) does this change how we think about declaring code? (I think no, because the code is still minimal and functional, but Oracle presumably disagrees).

Secondarily, I don't think the article considers the differences between Oracle's position (now - it changed, which is one of the problems) and that of a contribution to standards. Contribution to a standard is made so that others will adopt it, presumably because it gives you a competitive advantage of some sort. By not being part of the standard, you risk having a fragmented (smaller) set of users. But if Oracle doesn't want others adopting Java language and would rather be limited, then that makes the analogy inapt. If Google had known this was not allowed and gone another way, it may well be that Java is dead today (figure that in to damages calculations). But a fear of companies submitting to standards and then taking it back is to me different in kind from companies that never want to be part of the standard. (Of course, as noted above, there is some dispute about this, as Sun apparently did act as if they wanted this language to be an open standard).

A final point: two sentences in the article caught my eye, because they support my view of the world (confirmation bias, of course). When speaking of standard setting organization policies, Duan writes: "To the extent that a copyright license is sought from contributors to standards, the license is solely directed to distributing the text of the standard. This suggests that copyright is simply not an issue with regard to implementing interfaces." Roughly interpreted, this means that these organizations think that maybe you can copyright your API, but that copyright only applies to slavish copying of the entire textual document. But when it comes to reuse of the technical requirements of the standard, we filter out the functionality and allow the reuse. This has always been my position, but nobody has argued it in this case.

All about IP & Price Discrimination

It's a grading/break week, so just a short post. A recent article that I enjoyed a lot, but that hasn't found much love on SSRN is Price Discrimination & Intellectual Property, by Ben Depoorter (Hastings) and Mike Meurer (Boston University). The paper has the following abstract:

This chapter reviews the law and economics literature on intellectual property law and price discrimination. We introduce legal scholars to the wide range of techniques used by intellectual property owners to practice price discrimination; in many cases the link between commercial practice and price discrimination may not be apparent to non-economists. We introduce economists to the many facets of intellectual property law that influence the profitability and practice of price discrimination. The law in this area has complex effects on customer sorting and arbitrage. Intellectual property law offers fertile ground for analysis of policies that facilitate or discourage price discrimination. We conjecture that new technologies are expanding the range of techniques used for price discrimination while inducing new wrinkles in intellectual property law regimes. We anticipate growing commentary on copyright and trademark liability of e-commerce platforms and how that connects to arbitrage and price discrimination. Further, we expect to see increasing discussion of the connection between intellectual property, privacy, and antitrust laws and the incentives to build and use databases and algorithms in support of price discrimination.

They call it a chapter, but they don't identify the book that the chapter will appear in. It's probably an interesting book.

In any event, the chapter is a really interesting, thorough look at price discrimination generally, in addition to price discrimination as it relates to IP. It discusses the pros and cons as well as the assumptions that underlie each. If you are interested in a better understanding of the economics of IP (and secondarily, the internet), this is a good read.

Valuing Wikimedia Commons Images

Several years ago, both Lisa and I wrote about Heald, et al.'s study that attempted to value public domain photographs as used on Wikipedia. While I liked the study a lot, two of my chief critiques were small sample size and unclear value of hits on Wikipedia pages.

A new paper extends their study, and provides even more evidence of the extensive use of Wikimedia Commons photos. In What is the Commons Worth? Estimating the Value of Wikimedia Imagery by Observing Downstream Use, Kris Erickson (University of Leeds), Felix Rodriguez Perez (Independent), and Jesus Rodriguez Perez (University of Glasgow), have attempted to generalize the findings from the prior study. The paper is published in an ACM conference proceeding, but is available without a paywall on SSRN. The abstract is here:

The Wikimedia Commons (WC) is a peer-produced repository of freely licensed images, videos, sounds and interactive media, containing more than 45 million files. This paper attempts to quantify the societal value of the WC by tracking the downstream use of images found on the platform. We take a random sample of 10,000 images from WC and apply an automated reverse-image search to each, recording when and where they are used ‘in the wild’. We detect 54,758 downstream uses of the initial sample and we characterize these at the level of generic and country-code top-level domains (TLDs). We analyze the impact of specific variables on the odds that an image is used. The random sampling technique enables us to estimate overall value of all images contained on the platform. Drawing on the method employed by Heald et al (2015), we find a potential contribution of USD $28.9 billion from downstream use of Wikimedia Commons images over the lifetime of the project.

In one fell swoop, the authors have answered my two concerns. The random sample is much larger, and their search went far beyond Wikipedia, to commercial and non-commercial uses. It turns out that the images were used a whopping 5.4 times each on average, which is a lot of usage when extrapolated to the millions of images in the Commons.

As with the prior study, estimating the value is a bit back of the envelope. Assuming that every commercial (and non-commercial) user would have paid the Getty Images fee is a big assumption, as many might have substituted to homegrown photos or maybe no photo at all. The authors note that this is a big assumption. Another issue is that not every item in the commons is within copyright, and my have been findable by other means.

That said, I do not think the assumption detracts from the value of the Wikimedia Commons for two reasons. First, they report Getty having revenues of nearly $1 billion per year, so finding $28 billion value over the lifetime of the WC is perhaps not far-fetched. Second, even if people would not pay the full amount, they might have been willing to pay less than the Getty fee (which also includes some public domain items). In the absence of WC, the differences between what they would have paid and what they get (either nothing or homegrown or search costs) is deadweight loss.

I frankly had no idea that Wikimedia Commons was used so much, but I'm glad that there's competition in the stock photo market. I'll finally note that the discussion about which images get used is an interesting one. It turns out-just like Netflix, Facebook, and Twitter-the stuff that gets curated for you is the stuff you wind up seeing and using.

No Fair Use for Mu(sic)

It's an open secret that musicians will sometimes borrow portions of music or lyrics from prior works. But how much borrowing is too much? One would think that this is the province of fair use, but it turns out not to be the case - at least not in those cases that reach a decision.  Edward Lee (Chicago-Kent) has gathered up the music infringement cases and shown that fair use (other than parody) is almost never a defense - not just that defendants lose, but that they don't even raise it most of the time. His article Fair Use Avoidance in Music Cases is forthcoming in the Boston College Law Review, and a draft is available on SSRN. Here's the abstract:

This Article provides the first empirical study of fair use in cases involving musical works. The major finding of the study is surprising: despite the relatively high number of music cases decided under the 1976 Copyright Act, no decisions have recognized non-parody fair use of a musical work to create another musical work, except for a 2017 decision involving the copying of a narration that itself contained no music (and therefore might not even constitute a musical work). Thus far, no decision has held that copying musical notes or elements is fair use. Moreover, very few music cases have even considered fair use. This Article attempts to explain this fair use avoidance and to evaluate its costs and benefits. Whether the lack of a clear precedent recognizing music fair use has harmed the creation of music is inconclusive. A potential problem of “copyright clutter” may arise, however, from the buildup of copyrights to older, unutilized, and underutilized musical works. This copyright clutter may subject short combinations of notes contained in older songs to copyright assertions, particularly after the U.S. Supreme Court’s rejection of laches as a defense to copyright infringement. Such a prospect of copyright clutter makes the need for a clear fair use precedent for musical works more pressing.

The results here are pretty interesting, as I discuss below.

Data Driven Creativity

My school started much earlier than my kids' school this year, so I spent a couple weeks at home while the rest of the family visited relatives across the country. I am not too proud to admit that I bingewatched an obscene amount of TV during the two weeks they were gone while I was completing some writing projects. It's really the first time I have done so; while I have shows that I like, I rarely get to watch them all at once, or to pick the next one on the list in rapid succession.

So, it was with a new interest that I enjoyed The Second Digital Disruption: Data, Algorithms & Authorship in the 21st Century by Kal Raustiala (UCLA) and Chris Sprigman (NYU). A draft of the article is on SSRN, and they blogged about it in a series of posts at Volokh Conspiracy. Here is the abstract:

This article explores the intellectual property ramifications that flow from the explosive growth of mass streaming technologies. Two decades ago rising internet usage led to what we call the first digital disruption: Napster, file-sharing, and the transformation of numerous content industries, from music to news. The second digital disruption is about the age of streaming and, specifically, how streaming enables firms to harvest massive amounts of data about consumer preferences and consumption patterns. Coupled to powerful computing, this data—what Mark Cuban has called “the new gold”—allows firms such as Netflix, Amazon, and Apple to know in incredible detail what content consumers like and how they consume it. The leading edge of this phenomenon—and the primary vehicle for our examination—is the adult entertainment industry. We show how Mindgeek, the little-known parent company of Pornhub and the dominant player in pornography today, has leveraged data about viewing patterns to not only organize and suggest content but even to dictate creative decisions. We first show how the adult industry adapted to the internet and the attendant explosion of free content. That story aligns with many similar accounts of how creative industries adapt to a loss of control over IP by restructuring and recasting revenue streams. We then show how content streaming firms have used data to make decisions about content aggregation, dissemination, and investment. Finally, we consider what these trends suggest for IP theory and doctrine. A key feature is that by making creative production less risky, what we call “data-driven authorship” drives down the need for strong IP rights.

I thought the discussion about how data drives what to create to be fascinating, and the article is well worth a read. I think the perfect example of what the authors are describing is the Netflix movie Bright, in which Will Smith plays a cop who teams up with an Orc on the LA Police. The movie was critically panned. Rotten Tomatoes: 26%. But viewers seem to like it a lot: Rotten Tomatoes Audience Score: 84%. Netflix is surely on to something here.

I could certainly see it playing out as I watched. I watched "The Five," a show by one of my favorite authors, Harlan Coben. So then Netflix gave me nothing but mysteries and suspense to watch, plus another show by Coben, Safe (both were great, by the way). But I'm not really a mystery show person - I like sci-fi. So, I watched one show, and then the suggestions got weird: do I like mystery? sci-fi? sci-fi mysteries? I wound up having to dig a bit for the next show.

But here's the interesting thing: the quality of the shows varied wildly, even among the genres that I liked. The writing, acting, editing, and direction mattered. I don't know about the Mindgeek and porn clips, but I will note a couple distinguishing factors. First, there is likely a...er...utilitarian factor associated with those works; people are not watching for the articles, as it were. Second, the works are much shorter; it is much easier to have a highly focused 15-25 minute clip than a 10 episode series. Even with these differences, I suspect viewers have their preferences about what they see in the different clips with the same data driven attributes.

My broader point, then, is that how we consider the effect of data driven works will depend a lot on how we view creativity. The data certainly reduces the creativity in certain major plot points, as well as the quantity of different types of works. But to some extent studios have always done this, only with rules of thumb and intuition rather than actual knowledge. In that sense, data will democratize creativity - if viewers want more women in better roles, there will be more women in better roles; no need to rely on a male studio executive's views on the matter.

Beyond selection, though, I suspect there is still room for surprise, storytelling, differentiation, and other forms of creativity. Consider Bright: write what you want, but it just has to star Will Smith, include the police, and feature orcs and elves. At the limit, too much data may constrain creativity, of course - the more you add, the less you can create.

To be clear, Raustiala and Sprigman don't say anything that contradicts my intuitions here. They make clear that creativity is on a continuum, and that data merely slides to one side. But they do question how viewers will perceive works, and it is there that I disagree with them. I suppose that we could hit that limit where everything is automated, but my gut says that despite having preferences for particular story aspects, viewers will always be able to separate the wheat from the chaff (though not the way I would - as just about every American Idol vote shows) and thus will always look for something new and different within their preferences. At least, I sure hope so.

Abstraction, Filtration, and Comparison in Patent Law

Last April, I had the good fortune to participate in a symposium at Penn Law School. The symposium gathered a variety of IP scholars to focus on the "historic" kinship between copyright and patent law. That kinship, first identified in Sony v. Universal Pictures, supposedly shows parallels between the two legal regimes. I use scare quotes because it is unclear that the kinship is either historic or real. Even so, there are some parallels, and a collection of papers about those parallels will be published in the inaugural issue of Penn's new Law & Innovation Journal.

My article is about the use of abstraction, filtration, and comparison (a distinctly copyright notion) in patent law. I have cleverly named it Abstraction, Filtration, and Comparison in Patent Law. A draft of the article is now on SSRN. Here is the abstract:

This essay explores how copyright's doctrine of abstraction, filtration, and comparison is being used in patent law, and how that use could be improved. This test, which finds its roots in the 1930s but wasn't fully developed until the 1990s, is one that defines scope for determining infringement. The copyrighted work is abstracted into parts, from ideas at the highest level to literal expression at the lowest. Then, unprotected elements are filtered out. Finally what remains of the original work is compared to the accused work to determine if the copying was illicit.

This sounds far removed from patent law, but there is a kinship, though perhaps one that is not so historic and a bit hidden. The essence of the test is determining protectable subject matter. These same needs permeate patent law as well. This essay explores how the test is implicitly used and should be explicitly used.

With design patents, the test might apply as it does in copyright, with functional elements being filtered out during infringement. Current precedent allows for this filtering, but not clearly or consistently. With utility patents, the abstraction, filtration, and comparison happen earlier, during the test for patentable subject matter. Here, the comparison is with what is conventional or well known. The essay concludes by discussing why the application is different for design and utility patents.

I think the article is interesting and brings some useful insights into how we should think about patentable subject matter, but you'll have to be the judge.

Use Based Copyright Terms

I didn't blog last week because, well, I was at Disneyland. But I love IP, and when you're a hammer, everything is a nail. So, I couldn't help but think as I looked at the gigantic Mickey Mouse on the Ferris wheel that things are going to start getting messy when the copyright in Mickey runs out.

It occurs to me that serial, long term uses of copyrighted works are different than one time publications. To the extent that copyright is intended to incentivize investment in creative works, then losing protection over time can limit the incentive to develop quality long term work.  I'm not just talking about Mickey - Superman (and the additional complication of rights clawback) and other serial comics create issues. Star Trek is 50, Rocky and Star Wars are 40, and even Jurassic Park is 25 years old. The solution we got to this problem, a longer term for everything, was not the right one. A better solution is that terms should last as long as copyrights are in use, plus a few years. Works that are simply "sold" without any new derivative work would be capped, so works without improvement could not last forever.

Now, this is not to say there aren't costs to protecting copyrights while they are still in use. There is a path dependency that can reduce incentives to come up with new works (in other words, bad sequels instead of new creativity). There is also value associated with the public being able to use works in their own ways.

I'm personally not worried about either of these. On the first, there are plenty of incentives for new entrants to create new works (we got Star Trek, then Star Wars, then Battlestar Galactica (I and II), and now the Expanse), and even serial works become stale after a while (there was no Rocky 50, as some parodies predicted). On the second, I think it is inconsistent with the first concern to worry about path dependence while also worrying that others should be able to use the works. Of course, fresh eyes can bring new ideas to the expression, but hopefully the original owners do that. At this point, non-utilitarian concerns come into play. As between a party who has invested in making a work valuable over a long period of time and a party who would like to use that value, I side with the investor and say newcomers can create their own new value. I realize that many disagree with me on this point. That said, I think there are some noncompetitive uses - fan fiction, say - that can bring new ideas and allow some new works.

Note that a use-based term cuts both ways. As Paul Heald has demonstrated, there is a significant drop in availability for older books that are still within the copyright term. A use-based rule would either end the term, or perhaps create a commercialization bounty similar to that proposed by Ted Sichelman for patents.

A great idea, right? Except, I thought no way that nobody else looked at Mickey and thought the same thing. So, at the IP Scholars Conference last week (which was great, by the way), I asked my colleague Shyam Balganesh from Penn about it, and he didn't even blink before saying that Landes and Posner wrote an article 15 years ago called Indefinitely Renewable Copyright, located here.

As you would expect from these two authors, they detail the costs and benefits of copyright terms, and they provide empirical evidence that showed how shorter copyright terms led to very few renewals. The primary divergence from my idea is that I would allow a challenge based on lack of use, whereas Landes and Posner seem to assume that use is synonymous with registration (as their data shows). But I can imagine times when parties renew but then do not use their works. Thus, the system should look a bit more like trademarks.

I've done no literature review, so it's entirely possible that others have written about this. If you wrote or know of such an article, feel free to pass it along, and I'll add it here for posterity.

#IPSC18 Preview: Copyright

Yesterday I previewed the panels on patents and innovation at next week's IP Scholars Conference at Berkeley Law. Here are the copyright-focused panels:

The Real World Impact of the Copyright Registration Prerequisite

Just before the summer recess, the Supreme Court snuck in a certiorari grant that I don't think has received much attention in proportion to its importance--Fourth Estate Public Benefit Corp. v. Wall-Street.com LLC. The issue is seemingly simple: before filing a lawsuit, a copyright owner must register the copyright. But what does it mean to register the copyright? Simply file the application, or actually receive the registration certificate.

I'd say this question is one of the most practically important IP questions the Court has faced in the last decade. When I was in active practice, I would estimate that a quarter to a third of our clients did not have a registration at the time they wanted to sue, and we relied on the Ninth Circuit's permissive "application is enough" rule to get a case filed (and sometimes seek injunctive relief). The alternative was to file and wait, sometimes months or even more than a year, to get a registration. (I've read that pendency is now about six to eight months). Alternatively, one can pay $800 for an expedited registration within 10 days.

Why might someone not file a registration well in advance of suing? First, because they don't have to. The post-Berne Convention adoption amendments from 1989 allow copyright to vest from the time of fixation. Indeed, in order to maintain compliance with Berne, the pre-filing registration requirement only applies to U.S. Works. Foreign works may sue at will--more on this later.

More practically, there are plenty of reasons why one might not file. In an era of mass digital photography, it would be ridiculously expensive to register every work in case one was infringed; it is far more efficient to see if anyone infringes, and then register that work. In software, new versions are created all the time--almost literally so in software as a service platforms. It would be impossible to file a new derivative work registration for every single released version, especially for open source (though I bet Microsoft does it).

As a result, the registration requirement would become a hammer that would keep rightful owners from bringing suit. The Supreme Court even recognized this several years ago in Reed Elsevier, Inc. v. Muchnick. In that case, a class of journalists filed suit for transfer of their print works into electronic databases. Some putative class members objected to a settlement, but they had not registered. The Court ruled that registration was not jurisdictional. Does this mean that one can apply and sue, so long as registration occurs before any final determination?

I won't run through the pro and con arguments in detail, as arguments can be made on each side from different interpretive points of view. The statute clearly states that registration is required. But another section states that registration is effective from the date of application. But another part states that one may sue if the registration has been denied, which implies that registration is not complete until accepted. But then one wonders how long an applicant must wait until there is an assumption that the work has been "pocket denied," especially when registration is a ministerial act. But then the copyright office might argue that registration is not a ministerial act. And so forth. But the outcome of the arguments will have a real effect on real people and businesses.

I'd like to end with the challenge not made in the case: equal protection. While a couple commentators here and there have mentioned this problem with the dual registration rules, I can find no case with "411(a) & 'equal protection'" as search terms. Requiring a separate hurdle for some works and not others is about as unequal as I can think of. It is unclear why SAP can file suit immediately, but Oracle may not. I don't know if the Supreme Court can reach this issue as part of its interpretive determination (it's not an issue and it wasn't briefed), but I hope it does.