OPINION: Copyright and 'the cloud': What goes up must come down

(A Canadian icon who knows something about clouds)

From the Wire Report, October 25, 2011

OPINION: Copyright and 'the cloud': What goes up must come down

October 25, 2011 - 5:07pm — By Howard P. Knopf

On Oct. 14, 2011, I had the pleasure of being a commentator along with Grace Westcott on a panel about competition and intellectual property implications of “the cloud.” The panelists were Prof. Salil Mehra, Prof. Pamela Samuelson, Dr. Craig McTaggart, and Prof. Oliver Goodenough. This was the wrap-up panel to a day-long conference organized by Prof. Ariel Katz who is the director of the Centre for Innovation Law and Policy at the University of Toronto Faculty of Law. (A webcast is archived here). My remarks here are an elaboration of points I raised in my own brief comments that followed excellent presentations.

The cloud generally refers to some or all of remote storage, access and processing of data by third party service providers. These services are generally accessible from anywhere on a variety of devices. The cloud does not merely refer to mysterious cyber-lockers where millions of illicit files are stored. We are all using the cloud, whether we realize it or not. Common examples would include such diverse services as Gmail, Google Docs, Scribd, Dropbox, and Facebook. Proposed new services include Apple's iCloud, which would feature a very sophisticated music storage and delivery service that would include all of a user's previously acquired tracks, with presumably no questions about where they came from. It would substitute better quality authorized versions where possible, all of this for about $25 a year. But, for reasons that follow, Canadians should not hold their breath waiting for this potentially very positive development that could benefit both musicians and consumers.

...

The rest, including the rather pessimistic conclusion, is available here.

HK

US "Firewall" Bill - Targets "Rogue" Websites

Here's a pres release and link to the current US "Firewall" Bill that would deal with  "Rogue websites that steal and sell American innovations have operated with impunity."

The Canadian DFAIT should take notice. A lot of foreign (e.g. Canadian) dolphins could get caught in this wide and ill-defined net.

And a lot of powerful companies and people inside the USA are also upset.

See Masnick's take - blunt even by his standards....here.

HK

FOR IMMEDIATE RELEASE: October 26, 2011 CONTACT: Kim Hicks (Smith), 202-225-3951

Matt Morgan (Conyers), 202-225-6906

Kathryn Rexrode (Goodlatte), 202-225-5431

Gabby Adler (Berman), 202-225-4695

Bipartisan Bill Combats Online Piracy

Washington, D.C. – A bipartisan group in the House today introduced legislation that expands protections for America’s intellectual property (IP) and combats the illegal distribution of counterfeit goods via rogue websites. The Stop Online Piracy Act (H.R. 3261) allows the Attorney General to seek injunctions against foreign websites that steal and sell American innovations and products. The bill increases criminal penalties for individuals who traffic in counterfeit medicine and military goods, which put innocent civilians and American soldiers at risk. And it improves coordination between IP enforcement agencies in the U.S.

Eight members joined House Judiciary Committee Chairman Lamar Smith (R-Texas), Ranking Member John Conyers (D-Mich.), IP Subcommittee Chairman Bob Goodlatte (R-Va.) and Rep. Howard Berman (D-Calif.) in sponsoring the bill.

Chairman Smith: “Rogue websites that steal and sell American innovations have operated with impunity. The online thieves who run these foreign websites are out of the reach of U.S. law enforcement agencies and profit from selling pirated goods without any legal consequences. According to estimates, IP theft costs the U.S. economy more than $100 billion annually and results in the loss of thousands of American jobs.

“The Stop Online Piracy Act helps stop the flow of revenue to rogue websites and ensures that the profits from American innovations go to American innovators. The bill prevents online thieves from selling counterfeit goods in the U.S., expands international protections for intellectual property, and protects American consumers from dangerous counterfeit products. American IP industries provide 19 million high-paying jobs to the U.S. economy and account for more than 60% of U.S. exports. It’s time to stop online piracy and start protecting American jobs and innovations.”

Ranking Member Conyers: “Today marks an important step in furthering Congress’ constitutional prerogative to protect the rights of artists and innovators. The Stop Online Piracy Act builds on the work of Members like Howard Berman who have championed these issues for years, and I look forward to working with all of the entities in the online ecosystem to effectively choke off the funding for rogue websites and eliminate their safe-havens as the bill becomes law. Millions of American jobs hang in the balance, and our efforts to protect America’s intellectual property are critical to our economy’s long-term success.”

IP Subcommittee Chairman Goodlatte: “Intellectual property is one of America’s chief job creators and competitive advantages in the global marketplace, yet American inventors, authors, and entrepreneurs have been forced to stand by and watch as their works are stolen by foreign infringers beyond the reach of current U.S. laws. This legislation will update the laws to ensure that the economic incentives our Framers enshrined in the Constitution over 220 years ago - to encourage new writings, research, products and services - remain effective in the 21^st Century’s global marketplace, which will create more American jobs. The bill will also protect consumers from dangerous counterfeit products, such as fake drugs, automobile parts and infant formula. I look forward to continuing to work with all parties on this important legislation as it moves forward.”

Rep. Berman: “Rogue websites that are designed to provide counterfeit goods and pirated materials impact every region of the country, most sectors of the economy, and cost the US thousands of jobs every year. It is especially egregious when the harm comes from foreign websites or from rampant piracy and counterfeiting abroad. The Stop Online Piracy Act is an important next step in the fight against digital theft and sends a strong message that the United States will not waiver in our battle to protect America's creators and innovators.”

Additional cosponsors include: Rep. Marsha Blackburn (R-Tenn.), Rep. Mary Bono-Mack (R-Calif.), Rep. Steve Chabot (R-Ohio), Rep. Ted Deutch (D-Fla.), Rep. Elton Gallegly (R-Calif.), Rep. Tim Griffin (R-Ark.), Rep. Dennis Ross (R-Fla.), and Rep. Lee Terry (R-Neb.).

The House Judiciary Committee will hold a hearing on the Stop Online Piracy Act on November 16, 2011. Bill summary is attached.

IP Osgoode Comes To Ottawa With a Flourish - "Can Canada Learn Anything From Europe"?

IP Osgoode yesterday came to Ottawa with a flourish on Friday, October 21, 2011 to present a one day conference entitled “Can Canada Learn Anything From Europe?  European Perspectives on Copyright Law in the Information Era”.

It was really an excellent event - balanced, informative and even provocative.

All of the presenters were from Europe, with a good mix of those with common and civil law backgrounds. There were familiar faces. No doubt, the best known was the legendary lion (and indefatigable “Energizer Bunny®”)  of international copyright law, the ubiquitous, brilliant, and irresistible Mihály Ficsor. He is the “father” of the WIPO treaties, which Canada will no doubt eventually ratify. He now claims to have achieved the “70" part of “life plus 70". Interestingly, the topic of term of copyright was barely mentioned at all. Perhaps nobody thought that there is anything to be learned from Europe’s promiscuous penchant for prolonging copyright terms. Other well known presenters included Eric Baptise, Silke Von Lewinski, and Ted Shapiro (MPA’s man in Brussels), all of whom have a real and substantial connection, so to speak,  to and knowledge of many different jurisdictions.  Panel chairs were Pina D’Agostino, Carys Crag, David Vaver and Victor Nabhan.

There were some notable new faces and speakers, including Jonathan Griffiths from Queen Mary, University of London and Mindaugas Kiškis from Lithuania, to name just two. All of the presenters were very good.

Above all, the presentations were balanced overall and none were polemic. Ted Shapiro, who represents the movie industry and with whom I have sparred at Fordham, predictably called for strong rights and effective enforcement, but did so in a measured and constructive way. Prof. Griffiths dismissed as “absurd”, if I correctly recall his choice of adjective, arguments that call for the imposition of a highly restrictive reading of the Berne three-step test that would render the long-standing exceptions in many national laws meaningless and would, according to the concerted proponents of this theory, result in virtually no exceptions and limitations.  Levies were mentioned often, since most European countries - except the UK - have levies. The UK government continues to oppose levies.  

For those unfamiliar with the EU, this was a good introduction to the incredible labyrinth of directives that the now 27 member states must honour while at the same time continuing with their national cultures and traditions, and the basic fact that copyright law is - and arguably should remain - essentially territorial in nature.  Eric Baptiste - who was CEO of CISAC in Paris and is now CEO of SOCAN in Toronto, Canada - discussed the demise of the Santiago Agreement and the difficulties of mandating simple solutions for licensing issues across  27 jurisdictions. 

Time being limited, there was little direct discussion about the functioning (or lack thereof) of the European Commission and the judicial system that includes “references” from member states. The late, great Sir Hugh Laddie was not notably enthusiastic about how all of this was developing with respect to IP law.  For example, it would have been interesting and useful to hear more about the forthcoming SAS Institute Inc. v World Programming Limited case at the ECJ case about whether copyright should extend to the functionality of computer programs and why it is that the ECJ will hear this case, an issue clearly resolved about 25 years ago on this side of the pond. That said, there was considerable discussion about the recent ECJ Premier League decision involving football and decoder cards.

It is apparent that all of the workings and developments in the EU are incredibly complex and not always productive. The tower of Babel created by the recognition of 21 languages is just one aspect of this complexity.  With the current economic and political troubles and a long view of history, one sometimes wonders how much longer the EU as such will survive. However, that issue was not on the official program.

Perhaps not unsurprisingly, a number of speakers referred frankly to what Canada should not learn from the EU.

Pina D’Agostino and her colleagues are to be complimented not only for the substantive content of the conference but for the brave act of hosting it in Ottawa, while they hail from Toronto. This is a real logistical achievement. The arrangements at the new Ottawa Convention Centre were outstanding, including a high quality webcast that I understand will be archived. IP Osgoode’s generous sponsors also deserve credit and thanks. Remarkably, there was no registration fee. And there was even a very pleasant “free lunch”.

This was the first of more promised IP Osgoode “destination” conferences. Next year, if Canada has a new act, and maybe even if we don’t, hopefully IP Osgoode will take its show on the road once again. 

HK

Steve Jobs on How he Started Apple with "Illegal" Devices. Lessons to be Learned re Bill C-11?

Here's an amazing interview with Steve Jobs about how he and Steve Wozniak ("Woz") made what he admits were "illegal" "Blue Boxes" for telephone hacking. These were their first products.

"If we hadn't of made blue boxes, there would have been no Apple."

Fast forward to the DMCA and Bill C-11. So, is there a "bright line" between "criminal" activity, "piracy",  and "innovation"?

This is recounted on tonight's "60 Minutes" and is apparently in the new biography.

HK

Crookes v. Newton - Hyperlinking is Not Publication - Implications for Access Copyright's Proposed Post-Secondary Tariff

Today’s Supreme Court of Canada ruling in Crookes v. Newton is a well deserved victory not only for Jon Newton and his very capable counsel, Dan Burnett and Harvey Delaney, but for the internet itself. The Court was fully aware of what was at stake.

Here are some excerpts from the majority opinion written by Abella, J.:

...I would conclude that a hyperlink, by itself, should never be seen as “publication” of the content to which it refers. (para. 14)

Hyperlinks thus share the same relationship with the content to which they refer as do references. Both communicate that something exists, but do not, by themselves, communicate its content. And they both require some act on the part of a third party before he or she gains access to the content. The fact that access to that content is far easier with hyperlinks than with footnotes does not change the reality that a hyperlink, by itself, is content neutral — it expresses no opinion, nor does it have any control over, the content to which it refers. (para. 30)

The Internet’s capacity to disseminate information has been described by this Court as “one of the great innovations of the information age” whose “use should be facilitated rather than discouraged” (SOCAN, at para. 40, per Binnie J.). Hyperlinks, in particular, are an indispensable part of its operation. As Matthew Collins explains, at para. 5.42:

Hyperlinks are the synapses connecting different parts of the world wide web. Without hyperlinks, the web would be like a library without a  catalogue: full of information, but with no sure means of finding it.

(para. 34)

The Internet cannot, in short, provide access to information without hyperlinks. Limiting their usefulness by subjecting them to the traditional publication rule would have the effect of seriously restricting the flow of information and, as a result, freedom of expression. The potential “chill” in how the Internet functions could be devastating, since primary article authors would unlikely want to risk liability for linking to another article over whose changeable content they have no control. Given the core significance of the role of hyperlinking to the Internet, we risk impairing its whole functioning. Strict application of the publication rule in these circumstances would be like trying to fit a square archaic peg into the hexagonal hole of modernity. (para. 36)

Making reference to the existence and/or location of content by hyperlink or otherwise, without more, is not publication of that content. Only when a hyperlinker presents content from the hyperlinked material in a way that actually repeats the defamatory content, should that content be considered to be “published” by the hyperlinker. Such an approach promotes expression and respects the realities of the Internet, while creating little or no limitations to a plaintiff’s ability to vindicate his or her reputation. While a mere reference to another source should not fall under the wide breadth of the traditional publication rule, the rule itself and the limits of the one writer/any act/one reader paradigm may deserve further scrutiny in the future. (para. 42)

The Chief Justice and Justice Fish, in a brief concurrence, add the qualification that:

In our view, the combined text and hyperlink may amount to publication of defamatory material in the hyperlink in some circumstances. Publication of a defamatory statement via a hyperlink should be found if the text indicates adoption or endorsement of the content of the hyperlinked text. If the text communicates agreement with the content linked to, then the hyperlinker should be liable for the defamatory content. The defendant must adopt or endorse the defamatory words or material; a mere general reference to a web site is not enough. Thus, defendants linking approvingly to an innocent web site that later becomes defamatory would not be liable. (Para. 48)

Justice Deschamps also provides a lengthy concurring opinion which I have not yet had time to analyze. 

Comment: 

Justice Abella’s resounding defence of the internet and the essential role of linking will be widely read and much quoted. It is not a free pass for defamation online.  While a link “by itself” will not be viewed as publication in a defamation action, the addition of commentary approving or adopting the content of site to which the link points could give rise to liability. The Chief Justice and Justice Fish confirm this point. They also add that an approving reference to a site that later becomes defamatory will not give rise to liability.

This decision bodes well for the objectors to Access Copyright’s proposed post-secondary tariff that seeks a 1,300% increase over the current basic license fee. The proposed tariff defines a “copy” as including a digital copy “made by or as a consequence” of “posting a link or hyperlink to a Digital Copy”. It also goes on to include a demand for payment for any required or recommended readings that are “(i) emailed, linked or hyperlinked to, or  (ii) posted, uploaded to, or stored, on a Secure Network.”

Access Copyright also wants the right to audit the secure networks inside universities, including professors’ emails, to monitor such links and hyperlinks.

Today’s decision may warrant an early attempt to dispose of this controversial element of the proposed Access Copyright tariff. If a link or hyperlink by itself does not constitute “publication” for defamation purposes, it is difficult to see how it could, by itself, constitute publication or reproduction or any other activity covered by the Copyright Act.

The removal of this aspect of the proposed tariff would greatly simplify the case now proceeding at the Copyright Board. Perhaps one or more of the objectors will ask the Copyright Board for a preliminary ruling to this effect. If the Board declines to so rule, consideration might be given to judicial review.


HK

Crookes v. Newton - Newton Wins - Hyperlinking is Not publication

The Supreme Court of Canada has ruled that Newton wins and hyperlinking is not "publication". Analysis to follow. Here's the headnote:

       Per Binnie, LeBel, Abella, Charron, Rothstein and Cromwell JJ.:  To prove the publication element of defamation, a plaintiff must establish that the defendant has, by any act, conveyed defamatory meaning to a single third party who has received it.  Traditionally, the form the defendant’s act takes and the manner in which it assists in causing the defamatory content to reach the third party are irrelevant.  Applying this traditional rule to hyperlinks, however, would have the effect of creating a presumption of liability for all hyperlinkers.  This would seriously restrict the flow of information on the Internet and, as a result, freedom of expression.

                    Hyperlinks are, in essence, references, which are fundamentally different from other acts of “publication”.  Hyperlinks and references both communicate that something exists, but do not, by themselves, communicate its content.  They both require some act on the part of a third party before he or she gains access to the content.  The fact that access to that content is far easier with hyperlinks than with footnotes does not change the reality that a hyperlink, by itself, is content neutral.  Furthermore, inserting a hyperlink into a text gives the author no control over the content in the secondary article to which he or she has linked.

                    A hyperlink, by itself, should never be seen as “publication” of the content to which it refers.  When a person follows a hyperlink to a secondary source that contains defamatory words, the actual creator or poster of the defamatory words in the secondary material is the person who is publishing the libel. Only when a hyperlinker presents content from the hyperlinked material in a way that actually repeats the defamatory content, should that content be considered to be “published” by the hyperlinker.

                    Here, nothing on N’s page is itself alleged to be defamatory.  Since the use of a hyperlink cannot, by itself, amount to publication even if the hyperlink is followed and the defamatory content is accessed, N has not published the defamatory content and C’s action cannot succeed.

                    Per McLachlin C.J. and Fish J.:  The reasons of the majority are agreed with substantially. However, a hyperlink should constitute publication if, read contextually, the text that includes the hyperlink constitutes adoption or endorsement of the specific content it links to.  A mere general reference to a website is not enough to find publication.

                    Per Deschamps J.:  Excluding hyperlinks from the scope of the publication rule is an inadequate solution to the novel issues raised by the Internet.  This blanket exclusion exaggerates the difference between references and other acts of publication, and treats all references, from footnotes to hyperlinks, alike, thereby disregarding the fact that references vary greatly in how they make defamatory information available to third parties and, consequently, in the harm they can cause to people’s reputations.

                    In the common law of defamation, publication has two components: (1) an act that makes the defamatory information available to a third party in a comprehensible form, and (2) the receipt of the information by a third party in such a way that it is understood.

                    In the context of Internet hyperlinks, a simple reference, absent evidence that someone actually viewed and understood the defamatory information to which it directs third parties, is not publication of that content.  In order to satisfy the requirements of the first component of publication, the plaintiff must establish, on a balance or probabilities, that the hyperlinker performed a deliberate act that made defamatory information readily available to a third party in a comprehensible form.  An act is deliberate if the defendant played more than a passive instrumental role in making the information available.  In determining whether hyperlinked information is readily available, a court should consider a number of factors, including whether the hyperlink is user-activated or automatic, whether it is a shallow or a deep link, and whether the linked information is available to the general public (as opposed to being restricted).  Any matter that has a bearing on the ease with which the referenced information could be accessed will be relevant to the inquiry.

                    For an action in defamation to succeed, the plaintiff must also satisfy the requirements of the second component of publication on a balance of probabilities, namely that a third party received and understood the defamatory information.  This requirement can be satisfied either by adducing direct evidence or by asking the court to draw an inference based on, notably, whether the link was user-activated or automatic; whether it was a deep or a shallow link; whether the page contained more than one hyperlink and, if so, where the impugned link was located in relation to others; the context in which the link was presented to users; the number of hits on the page containing the hyperlink; the number of hits on the page containing the linked information (both before and after the page containing the link was posted); whether access to the Web sites in question was general or restricted; whether changes were made to the linked information and, if so, how they correlate with the number of hits on the page containing that information; and evidence concerning the behaviour of Internet users.  Once the plaintiff establishes prima facie liability for defamation, the defendant can invoke any available defences.

                    Here, N acted as more than a mere conduit in making the hyperlinked information available.  His action was deliberate.  However, having regard to the totality of the circumstances, it cannot be inferred that the first, shallow hyperlink made the defamatory content readily available.  The various articles were not placed on N’s site’s home page and they had separate addresses.  The fact that the reader had to take further action in order to find the defamatory material constituted a meaningful barrier to the receipt, by a third party, of the linked information.  The second, deep hyperlink, however, did make the content readily available.  All the reader had to do to gain access to the article was to click on the link, which does not constitute a barrier to the availability of the material.  Thus, C has satisfied the requirements of the first component of publication on a balance of probabilities where this link is concerned.  However, the nature of N’s article, the way the various links were presented and the number of hits on the article do not support an inference that the allegedly defamatory information was brought to the knowledge of some third person.  The defamation action with respect to either of the impugned hyperlinks cannot succeed. 

Crookes v. Newton Decision from SCC due on Wednesday October 19, 2011.

 

Jon Newton

On Wednesday, Oct. 19, 2011 at 9:45 the Supreme Court of Canada ("SCC") will announce its long awaited decision in Crookes v. Newton, in which the issue was whether merely providing a hyperlink to an article, without quoting from it or commenting on it, could constitute publication of the impugned article and hence could in itself be defamatory. Here's the SCC summary.
 
The case clearly raises very important issues. There was a lengthy dissent in the British Columbia Court of Appeal judgment below.

The outcome could have significant and immediate implications for copyright law. For example, Access Copyright is taking the position in a current hearing that merely linking to a website creates an entitlement to payment as part of the its proposed post-secondary tariff that seeks a 1,300% increase over the current basic rate.

Indeed, if the Court holds that mere hyperlinking creates liability, there could be enormous implications for the internet generally. The "World Wide Web" (i.e. "www”) was and is built upon hyperlinks.

HK