Tag: VidAngel

Busy Copyright Week Update

Though most people can be forgiven for missing it, two Supreme Court Decisions and a District Court granting a motion for summary judgment made a fair bit of copyright news this week.  In a pair of unanimous decisions the Supreme Court settled two statutory disputes relevant to a rightsholders’ ability to enforce his copyrights.  And pursuant to findings at the Ninth Circuit Court of Appeals, the District Court for the Central District of California granted a motion for summary judgment against VidAngel for its infringement of major Hollywood motion pictures.

“Registration” Means USCO Approval 

In Fourth Estate Public Benefit Corp. v. Wall-Street.com, Justice Ginsburg wrote the opinion holding that there is no way for the Court to read the copyright statute §411(a) other than to mean that the Copyright Office must grant Registration of a work before a rightsholder may litigate to remedy an alleged infringement.  

This decision resolves a court split over the issue, with the counter argument contending that filing the application is tantamount to “registration” and that a rightsholder should be allowed to proceed with legal action while the USCO is processing the application. Ginsburg and the other eight Justices found that reading of the statute unpersuasive, but the opinion also recognizes the practical challenge faced by rightsholders given that it takes an average six to seven months to receive a Certificate of Registration.  

This is especially acute in a time when online infringement may be almost instantaneous, and it is not impossible that there may be some legislative response to address these issues, not the least of which would be increasing resources for the USCO.  That said, the House Judiciary Committee does seem a little busy right now.  (See further discussion here.)

“Full Costs” Means Less Full Than Some Hoped

From the opposite ideological end of the bench, Justice Kavanaugh wrote the opinion in Rimini Street v. Oracle USA, another unanimous decision settling yet another statutory interpretation, this time §505 pertaining to the meaning of the term “full costs.” At issue was the question as to whether recoverable legal costs under the copyright statute may extend beyond the six categories of “taxable” costs that a court may award to a litigant in a copyright case. 

After Oracle prevailed in its copyright infringement suit against Rimini Street, it sought $12.8 million to recover its costs for expert witnesses, jury consulting, and e-discovery, which are not enumerated under Title 28 federal statutes pertaining to the types of costs a claimant may recover.  For context, I recommend Kevin Madigan’s analysis posted at the Center for the Protection of Intellectual Property, in which he contends that this decision is an incomplete reading and, as a practical matter, may disadvantage defendants as well as complainants in copyright cases. 

VidAngel’s Flight Seems All But Over

Finally, in the major motion picture studios’ case against VidAngel, a California District Court, finding no triable issues of fact, granted the studios’ motion for summary judgment this week.  As described in posts here and here, VidAngel is the VOD service that provided unlicensed streams of major motion pictures with options to “filter” out the naughty bits—sex, swearing, blasphemy, etc.—its base of customers preferred not to see or hear.  

Although filtering is permitted by law with devices designed for that purpose to be used in one’s own home, VidAngel endeavored to construct a convoluted business model in order to contend that its process of copying, filtering, and streaming films to customers for what amounted to rental fees was nothing more than an extension of the individual consumer’s right to filter.  All of the sanctified streamer’s defenses failed, and the company is held to have infringed the studios’ exclusive rights of reproduction and public performance as well as violated the anti-circumvention provisions under §1201 of the DMCA for decrypting DVD and Blu-Ray disks in order to create the files necessary for its service.

I may write a more extensive post about the outcome in VidAngel, which is an instructive case on a number of levels, but one that sticks out at the moment is the company’s attempt to assert fair use in defense of its circumventing DRM pursuant to the DMCA.  As the District Court notes, there is no fair use defense for violating §1201, though one could easily make this mistake based on the confusion and debate surrounding this statute.  

The distinction is that the Copyright Office has granted exemptions from the provisions of this section of the DMCA for specific uses (e.g. education, commentary, research) that are likely to be fair uses.  This is not the same thing as asserting a fair use defense for circumventing DRM for a purpose not already exempted by the USCO.  And VidAngel’s purpose in making entire motion pictures available (minus a bit of skin and a few curse words) does not come anywhere close to being considered for such an exemption.

Copyright in Motion As Midterms Approach

While most attention will be understandably focused this week on the Senate Judiciary and the confirmation (or not) of Brett Kavanaugh, there is actually quite a bit of copyright law activity of note as the midterms approach.

Register of Copyrights Selection and Accountability Act Hearings Scheduled

Originally introduced in the House in March 2017 as H.R. 1695, this bill proposes a reorganization, favored by many copyright experts, to make the Copyright Office independent of the Library of Congress and to make the Register of Copyrights an executive appointee rather than a hired member of the Librarian’s staff. The bill passed the House in May of 2017 with a vote of 378-48 but then stalled in the Senate Rules Committee (as S. 1010). On Wednesday of this week, that committee will hold hearings on this legislation.

As described in a few posts, the formation of the USCO within the LOC dates back to 1897, when Congress could hardly have envisioned the copyright industries as we know them today; and both scholars and legal professionals have long viewed the current organizational structure as antiquated. Despite complaints by the usual assortment of critics—and they are likely to resurface after this week’s hearing—the Librarian and Register have always performed different functions predicated on very different areas of expertise; and the intervening 120 years has only increased the divergent roles of the two departments. This is a change long in development and long overdue.

CASE Act Hearings Scheduled

Following that hearing, on Thursday, the House Judiciary Committee will hold hearings on the proposed CASE Act, which would create a small claim copyright tribunal within the Copyright Office. The purpose of CASE is to provide a remedy for copyright disputes that do not easily justify the cost of federal litigation. For instance, the proposal is backed very strongly by professional photographers, whose works are infringed with a high rate of frequency online, even by business entities exploiting images for commercial purposes.

True to form, the copyright critics have predicted a litany of negative consequences that are simply not possible within the scope of the proposed statute. For instance, as a purely voluntary option, the new tribunal cannot become the “clearing house for copyright trolls” critics like EFF have alleged. Moreover, the USCO board will be experts in copyright law only, which is not true of federal judges, and there is no reason to believe this remedy would not prove to be as beneficial to defendants as to claimants. Still, the committee will be reviewing the latest version of the bill, which represents ongoing discussion among proponents and good-faith critics of the legislation.

The VidAngel Bill?

In August of 2017, the Ninth Circuit Court of Appeals shot down all the legal defenses, previously shot down by a California District Court, as presented by the movie filtering service called VidAngel. For a detailed background, see posts here and here; but briefly, VidAngel was sued by major motion picture studios for copyright infringement based on the manner in which the company was providing streamed access to movies while filtering out segments containing language, sexual content, or other material that VidAngel’s subscribers find objectionable, primarily on religious grounds.

Among its failed defenses, VidAngel asserted an unsound interpretation of the Family Movie Act (2005), which permits private use of consumer devices to make brief segments of motion pictures imperceptible during home viewing. Having lost its court fight with that statute (along with key statutes in the copyright law), VidAngel has apparently been lobbying Members of Congress, mainly its CEO’s hometown Utah Representatives, to propose an amendment (H.R. 6816) to the Family Movie Act that would theoretically enable VidAngel to perform, as a VOD service, the same task consumers are allowed to perform by means of devices at home.

Setting aside my own opinion of any consumer’s desire to edit out segments of movies on moral grounds, the legislators in this case may believe they’re simply updating the FMA for the digital-streaming market, but if so, they have failed to consider the staggeringly disruptive implications their bill would have on copyright law, contracts, and licensing agreements.  As a simple example, amending the FMA in this manner does not obligate the studios to license their films to VidAngel, which had been making public performances of these works without licenses.  And it gets more complicated from there — all for the sake of one company to profit from an activity that other companies have enabled consumers to conduct legally for 13 years.  I think this bill is likely a dead-issue, and with it VidAngel; but it will be something to watch if that’s not the case.

Doctorow & EFF Declare Perpetual War On DRM

On a slightly related note (because VidAngel violated Section 1201 of the DMCA), Cory Doctorow, in his role as EFFer, urged the organization’s followers to keep Sisyphean-like faith in “Our Apollo 1201 Project [which] aims to kill all the DRM in the world inside of a decade ….” Digital Rights Management tools, designed to protect copyrighted software from unlicensed access, copying, or tampering, has been portrayed by critics like Doctorow as a means to entrench corporate control of various markets more than as a means to protect authors of creative works.

It’s not that DRM is without such challenges or does not require constant reassessment, but Doctorow and company generally lack all deference to nuance, or integrity, when discussing the issues. For instance, they make no mention of the fact that, without DRM, many of the convenient ways in which we access works in the digital age (e.g. eReaders) would not exist. Moreover, as elaborated upon in this post, the EFF’s assault on the constitutionality of Section 1201 of the DMCA—the section prohibiting circumvention of DRM—conveys more ideological hatred than an honest portrayal of, for instance, the USCO’s position on exceptions to 1201’s prohibitions.

As noted in that post, rather than engage in the USCO’s call for reasonable changes to permanent exceptions etc., the EFF is instead hell-bent on the (dare I say perpetual-funding opportunity?) more dubious mission to eradicate the law. In this regard, it is notable that Doctorow employs the metaphor of ants steadily, if blindly, making slow progress up a hill. The presumptive “ants” (see Donors) Doctorow is addressing might want to look up the word Myrmidon.

Ninth Circuit Says VidAngel’s Wings Made of Wax

(Angel image by in8finity)

“Drat! Phooey! Shucks!” must be what the folks at VidAngel are saying after this morning’s opinion was handed down by the Ninth Circuit Court of Appeals in Disney Enterprises v. VidAngel. Affirming the decision of a California district court, the panel agreed that the movie studio plaintiffs would very likely prevail on the merits in all of the triable issues in the case. Thus, the preliminary injunction ordered by the lower court will stand, and VidAngel will not be allowed to operate as it had been while the company considers whether or not they will take its case to trial. I’m going to bet they won’t.

See detailed description of VidAngel in post from February.

VidAngel had been running what amounts to an unlicensed, video on demand (VOD) service, streaming mainstream movies with a filtering option for customers who prefer not to experience swearing, nudity, blasphemy, and/or other “objectionable” material in their movies. Several major studios sued VidAngel for copyright infringement; and VidAngel sought to defend its model, with all the verve of Icarus, by means of some rather strenuous interpretations of the Family Home Movie Act (FMA), Section 1201 of the DMCA, and the fair use doctrine. The Ninth Circuit opinion is unambiguous in its disagreement with all of the defendant’s statutory interpretations. For instance, here’s a pull-quote regarding VidAngel’s defensed under the FMA:

“VidAngel’s interpretation would create a giant loophole in copyright law, sanctioning infringement so long as it filters some content and a copy of the work was lawfully purchased at some point. But, virtually all piracy of movies originates in some way from a legitimate copy. If the mere purchase of an authorized copy alone precluded infringement liability under the FMA, the statute would severely erode the commercial value of the public performance right in the digital context, permitting, for example, unlicensed streams which filter out only a movie’s credits.”

Like many tech businesses that depend on copyright infringement, VidAngel spent considerable effort trying to litigate its cause in the court of public opinion with a “Save Filtering” campaign. This is common practice: to sell the message that a particular business model is merely an extension of consumer rights. And although many of VidAngel’s fans are likely to view this decision as “anti-filtering,” those consumers should know that VidAngel violated at least three statutes, even without the filtering; and its attempt to argue their right to filter on behalf of consumers shoots far beyond the mark of either the intent or the language of the FMA.

It’s hard to imagine any VidAngel investors* are going to want to pursue what looks like an un-winnable case, but maybe they’ll be spared a worse fate. Because if they tried to put, say, Deadpool through their system, the place would probably explode.

*See comments.