Category: Law & Policy

NY Gov. Hochul Vetoes eBook Lending Bill

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Yesterday, New York State Governor Kathy Hochul vetoed A5837, the eBook lending bill, which is almost identical to bills in Rhode Island, Massachusetts, and Maryland. The Maryland law, set to take effect on the first of the new year, triggered litigation by the American Association of Publishers (AAP), primarily on the basis that these bills are unconstitutional, preempted by federal copyright law, and this was the rationale stated by Governor Hochul for her veto. But even if preemption were not an issue, I am glad to see that New York, the birthplace of America’s literary heritage, has rejected legislative tactics designed to weaken the rights of authors.

In addition to the fact that New York is and always has been central to American publishing, antebellum New York was the epicenter of the first domestic literary movement, which proclaimed a more democratic literature that would no longer feed off the traditions of Europe. Walt Whitman was among the first young authors who answered that call with his elegy Leaves of Grass, but who also joined the contemporary authors who advocated for better copyright law. The cultural dividend of those efforts is the diverse anthology of literary works we enjoy today, and, of course, New York retains its prominence in literature, art, and entertainment.

The eBook Bills Are a Solution Without a Problem

These eBook lending bills are allegedly written to meet an unfulfilled demand for library access to eBooks by compelling publishers to license to state libraries and mandating the terms of those arrangements. But aside from the consideration that this amounts to an illegal state compulsory license, if the governors were to visit their state libraries, audit expenditures on eBook licensing, and assess demand for these works, they would find it difficult to identify the problem these bills are supposed to alleviate. On the contrary, the legislative background of these bills comprises little more than generalizations echoing Silicon Valley’s naïve view that somehow access to creative works can exist without production of creative works.

While doing no good for readers, these bills would cause significant harm to the complex symbiosis between authors and publishers and even jeopardize the symbiosis between authors and libraries. Yet, for reasons difficult to fathom, the American Library Association (ALA) and other library lobbying organizations continue to advocate policies hostile to authors’ interests. Although public libraries are essential and beloved, they do not operate in a vacuum but rather as part of a copyright economy that begins with authors.

Copyright incentivizes authors to produce and distribute their work by granting the exclusive right to decide the terms on which that work is made available, including timing, geography, price, and format. Often, these decisions may be the difference between success and failure, and any state law that functions as a compulsory license strips the author of those prerogatives. In this case, the eBook lending bills propose to divest the author of those rights in the service of a much broader agenda looking far beyond the narrow claim to improve eBook lending.

Familiar Tactics

Although copyright is rarely a partisan matter, it is notable that these bills have been pursued in blue states where it is easier to promote the idea that this is about corporate versus public interest with the librarians advocating for the latter. But aside from the fact that authors’ interests are a public interest, if one looks behind the blue curtain, one discovers the names of individuals (e.g. Jonathan Band) and organizations (e.g. Fight for the Future) with significant funding ties to the tech industry, which ultimately stands the most to gain by using state legislatures to chip away at federally protected rights.

For instance, the library groups generally endorse the tech industry view that these state bills are preludes to statutory changes to federal law, like amending Section 109 to extend the first sale doctrine to digital copies. But the library associations fail to recognize that such a change in the law would not only empower commercial ventures to exploit authors but would also hasten the irrelevance of libraries in the digital age.

While I think it is generally good news when any state governor recognizes federal law for what it is, in this case, it is especially gratifying to see New York spared from looking rather dumb considering its role in the copyright ecosystem. I believe we are about to see in Maryland that the courts affirm that these eBook bills are unconstitutional and, therefore, doomed to the scrap heap. In the meantime, perhaps the many thousands of creative professionals who live and work in New York State should ask why our legislature actually passed such a disruptive, and ill-fated bill without a damn good reason in the first place.

Ciao Internet Association. It’s been weird.

IA has made great progress on its mission to foster innovation, promote economic growth, and empower people through a free and open internet. As this chapter closes, member companies remain committed to advancing public policy in support of this mission and will continue to work with stakeholders in other capacities. – Board of Directors Statement on IA’s Future –

Thus spake the Internet Association upon announcing that it will cease operations at the end of this year; and anyone engaged in advocating the rights of creative professionals (i.e. copyrights) shall be forgiven their moment of schadenfreude. While it would be inaccurate to say that this lobbying organization was formed by the major internet platforms in response to the anti-piracy bills SOPA/PIPA, it was certainly no coincidence that IA formed concurrently with Silicon Valley’s extraordinary efforts to kill that legislation, which Congress abandoned in January of 2012.

It was the holiday season of 2011 when nearly every Member of Congress and the Obama White House expected the anti-piracy bills would pass easily into law. Neither Google, nor any of the internet giants, had much of a lobbying presence on Capitol Hill, but they did have an unprecedented advantage as an industry insofar as they owned the platforms we were all using to “share information” and shape one another’s views. They controlled the algorithms that prioritized results in a search or a newsfeed, and they had the data to show how effective a dumb meme could be for animating political action.

I believed then, as I do now, that the Stop SOPA campaign was a primer in how to affordably and effectively unravel a democratic republic—a little lie that taught others how to tell much bigger lies. At the same time that organizations like the EFF were congratulating themselves and the public for the “grassroots” effort that stopped those bills, Silicon Valley companies were already having discussions about getting their act together in Washington.

In addition to Google growing its own presence in D.C. from a whisper to a roar, they joined with Facebook, eBay, Amazon, and others to form the Internet Association, which was announced in the media in July of 2012—just six months after the defeat of the anti-piracy bills. The unstated mission of IA, couched in vague terms like “innovation” and “openness,” was arguably to maintain the status quo and keep the pesky laws of the “real world” from infecting the self-governing idealism of cyberspace.

Now, in a very different climate in which we even see Facebook make a show of asking Congress for regulation, it is fair to say that the status quo the IA was formed to maintain is a lost cause. Further, according to Politico, the organization’s funding imploded on the weak link that the giants’ interests are unsurprisingly not wholly aligned with the smaller members. The article quotes Yelp senior vice president of public policy Luther Lowe, using a colloquial acronym for Google, Apple, Facebook, and Amazon and stating, “This org could’ve saved itself years ago by kicking out everyone with a market cap greater than $500b (i.e. GAFA). I made this suggestion to the leadership a few years ago, but it was shot down, so we quit.”

Pause for schadenfreude. Go ahead. You’ve earned it.

In 2019, Netflix left the Internet Association and joined the Motion Picture Association—the same organization that lobbied for the anti-piracy bills and which was therefore cast as the leviathan that would “destroy the internet” and “end free speech” for the sake of a few more dollars for its movies, and all because the studios were “clinging to the dead model of copyright in creative works.” The Netflix switch was hardly a surprise for a company that was, in fact, a movie studio, but the point is that the foundation of IP protection for creative works endures while the underlying rationales for killing anti-piracy legislation in 2012 have not aged well.

Netflix, like any film producer, entertains millions of viewers while vague Silicon Valley’s vague allusions to speech rights and connecting people stammer in hearings on Capitol Hill, and lawmakers confidently announce that the free ride for internet platforms is over. Whether that means revision to liability standards like Section 230 or meaningful antitrust enforcement, etc. remains to be seen—especially while bipartisanship on these issues remains entangled in the kind of disinformation that metastasized on social media, and which is still endorsed by a consequential faction of the GOP.

While I am highly skeptical that legislation alone will help us restore the conduct necessary to maintain a healthy democracy, I do believe that there are policy-based solutions to particular harms like social media addiction in teens, nonconsensual pornography and harassment, predatory antitrust conduct, and, yes, rampant copyright infringement.

Such matters can and should be addressed through legislative action, and in that regard, the end of the Internet Association after just under a decade of operation should affirm at least two truths:  first, that maintaining the laissez-faire approach to cyber policy was always folly; and second, that there is no “the internet” to defend against public policy. The internet is just a network of machines upon which every individual and every business, small and large, is mutually dependent. So, ciao, Internet Association. It’s been weird.

SAS v. WPL Litigation is of Great Importance to the Smallest Creators

Software companies SAS Institute of the U.S. and World Programming, Ltd. (WPL) of the UK have been litigants for more than a decade. By all accounts, WPL presents as a bad actor which lazily cloned SAS’s world-class analytics software. But before weighing the facts necessary to consider claims of IP infringement, the Federal Circuit Court of Appeals must first overturn the errors of copyright law applied by a Texas District Court, lest those holdings further weaken the already tentative position of independent rightsholders.

Presumption of Validity

I’ve spent a lot of time recently talking about formalities in U.S. copyright law (particularly with regard to the Unicolors and Valancourt cases), and it is recognized by those who care about indie creators that certain mechanisms in our copyright system already disadvantage entrepreneurial rightsholders. The individual or small-business creator can hardly be blamed for smirking at the fact that copyright attaches automatically to a work upon fixation, when that statutory provision barely vests her with any real power to enforce her rights. Enter the inducement to register.

The primary incentive to timely registration of works with the Copyright Office is that it allows the copyright owner to obtain statutory damages and legal fees upon successful litigation of an infringement claim. But another essential inducement to registration is the “presumption of validity,” meaning that a court will presume at the outset that the work at issue is properly a subject of copyright protection based solely on its having been issued a valid registration by the Copyright Office.

The reason the presumption of validity is critical, and decades-long precedent, is that it correctly places the burden on the defendant to prove a lack of copyright in the work(s) used, if non-copyrightability is to be presented as a defense. The district court in SAS reversed this principle, placing the burden on the plaintiff to prove copyrightability of register works at trial, and then aggravated this error by engaging in an extraordinary copyrightability analysis of its own design it named a “Copyrightability Hearing.”

Not only was the hearing itself an attempt to plough new ground by this court, but its analysis was improper, citing certain features of the work (e.g. open source), which do not inherently raise copyrightability questions, and then arrived at the untenable logic that the protection of a whole work may be undermined simply because it contains unprotectable elements.

Undermining Copyrightability Itself

As noted in my first post about this case, arguably all works contain unprotectable and protectable elements, and I cited the motion picture as a highly complex combination of such elements which are assembled to compose the finished movie. Among the copyright registrations made for the project will be the motion picture as a single unit, comprising its many parts—protectable original, protectable sublicensed, and unprotectable common elements—under a single title.

Imagine the cost and time if the owner of the motion picture were required to re-prove at trial the copyrightability of the entire film through analysis of the various components and then prove that the arrangement and use of those components is sufficiently original for copyright to attach in the first place. And that’s before proceeding to trial of an infringement claim.

Now, imagine that burden is borne by the independent illustrator, photographer, writer, or music composer, if this district court’s abrogation of the “presumption of validity” were allowed to stand. “The plaintiff would face the insurmountable task of proving a negative—that all of his work is not in the public domain or not an idea,” states the amicus brief filed by Copyright Alliance.

The opportunities for independent creators to enforce their copyrights are already hamstrung by the authors’ limited resources and our overly bureaucratic system. As a result, the overwhelming majority of American creators of works do not participate in the U.S. copyright system. And that is presumably what the copyright detractors want to see.

It is no surprise that those who scorn the existence of copyrights—either because weak protection is in their financial interest or because they are disciples of the Tao of Lessig—have endorsed the district court’s findings in SAS. Because if one hopes to further erode the rights of individual creators, or, perhaps, even industrial creators, enshrining this court’s rulings as precedent would be a very effective means to achieve that end.

Courts outside the Second and Ninth Circuits can be unpredictable when it comes to copyright law; but here, the Texas district court’s novel approach might fairly be described as eccentric, if not downright misguided. For the sake of creators much smaller and more vulnerable than SAS, the Federal Circuit must reverse that court’s multi-faceted errors of law before this case can proceed to the merits of the actual claim.