Category Archives: Legal

DIRECT REPORTING: Tenenbaum oral argument

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A few hours ago, I attended oral arguments here in Boston before the First Circuit Court of Appeals in Sony BMG Music Entertainment v. Tenenbaum (Wikipedia backgrounder, appellate briefs here).  To summarize, several record labels sued Joel Tenenbaum for sharing music files on a peer-to-peer service, and Tenenbaum lost at trial.  However, trial court Judge Nancy Gertner reduced the jury verdict of $675,000 against Mr. Tenenbaum down to $67,500.

Both sides appealed.  The labels framed the sole issue on appeal as:

Whether the district court erred by holding that the jury’s award of $22,500 per work for willful infringement of 30 copyrighted works violated the Due Process Clause, even though that award is well within the range of statutorily prescribed damages awards for willful copyright infringement and even within the statutory range for non-willful infringement.

In contrast, defendant Tenenbaum framed the issues as:

1. Is the award of damages against the defendant unconstitutionally excessive?

2. Was the jury properly guided by the trial judge’s instructions?

3. Does the statute under which the defendant was prosecuted apply to individual noncommercial consumers?

4. Does 17 U.S.C. § 504(c) remain operative in the wake of Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340 (1998)?

Today’s hearing took place before a three-judge panel consisting of Chief Judge Sandra L. Lynch, Judge Juan R. Torruella, and Judge O. Rogeriee Thompson.  In addition to the plaintiffs and defendants, the United States (as intervenor) and the Electronic Frontier Foundation (as amicus curiae) presented oral arguments.

Based on the judges’ questions and demeanor at oral argument, my impression is that Joel Tenenbaum faces an uphill battle and is likely to lose his appeal.  I don’t have a transcript of the proceedings, but the following stands out from my notes and memory.

Chief Judge Lynch clearly had no tolerance for the defense’s contention that “no one thought” the statutory penalties for copyright infringement would ever apply to “consumers”.  She pointed out that the statute appeared to apply to consumers, eliciting a concession from Tenenbaum’s counsel that statutory copyright penalties were not facial unconstitutional.  This left the defense with little more than a half-hearted argument that the jury verdict was improper here because the copyright statute originally contemplated damage calculations by judges.

Judges Torruella and Thompson seemed somewhat more suspicious of the record labels’ arguments, but it was unclear whether these suspicions would help Tenenbaum win his case.  Judge Torruella asked the labels’ lawyer whether “lost sales” would provide a useful measure of damages, to which he replied that damages should be commensurate with the “lost of value of the copyright”.  He argued that file-sharing in the aggregate caused enormous economic losses to the labels because it essentially put the music “in the public domain.”  (Why Joel Tenenbaum should be personally responsible for the actions of thousands or millions of other file-sharers remained the obvious question he never managed to answer.)

For her part, Judge Thompson questioned whether appellate courts could ever find that a jury for statutory damages in a copyright infringement action to be excessive if it fell within the statutory range ($750 to $150,000 per work infringed).  The labels’ counsel did concede copyright damage awards were “not immune from Williams [Philip Morris USA v. Williams, 549 U.S. 346 (2007)] review” but maintained that such a problem would be “rare” and that this was not that case.

We likely won’t have the First Circuit’s decision for several months, so there’s still plenty of time to speculate about what the outcome will be.  I’ll continue posting as I have additional thoughts.

Update 4/5/2011:

Covering file-sharing appeal

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I’m going to be attending oral arguments here in Boston before the First Circuit Court of Appeals in the Sony BMG Music Entertainment v. Tenenbaum case (Wikipedia backgrounder) later this morning.  Appellate briefs are available here, summary from the defendant’s perspective here.

Check back later today for more commentary and analysis.

Patently ridiculous

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It’s April 1st, so the jokes are out in droves all over the web.  Groupon has decided to post a fake patent for April Fool’s Day joke:

The present invention relates to performing jocular and misleading activities on an unsuspecting individual during a limited timeframe and, in particular, the present invention relates to a perpetrator generating a false statement based on false facts and informing an unsuspecting
individual of the particular false statement, and deceiving the unsuspecting individual into a false belief that the false statement, if true, would have a detrimental effect on the unsuspecting individual. Then, prior to said unsuspecting individual realizing that the false statement is not accurate, the perpetrator announces, usually in a high decibel voice and within the limited timeframe, that the unsuspecting individual has been deceived or mislead.

Ha ha, but isn’t this a little too close to home?  Groupon is currently (counter)suing a small competitor named MobGob, as TechCrunch reported back in November.  For infringement of patent no. 6,269,343:

The present invention provides a method and system that allows sellers to communicate conditional offers to potential buyers. The conditions include prices that depend on the aggregate amount of goods or services that buyers collectively agree to purchase by a given time and date.

The invention facilitates “demand aggregation”, that is, aggregating demand by potential buyers (who may or may not know each other), for products offered by sellers. This invention allows sellers conveniently to offer “Demand-Based Pricing”, that is, prices which go down as the volume of units sold in any given offer goes up.

A seller can therefor offer volume discounts to buyers acting as a group, even when the buyers may not have any formal relationship with one another.

Telling jokes and aggregating buyers.  Maybe this is why we need patent reform.

Pandora’s (copyright) box

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It’s no secret that copyright law is ridiculously complicated and in bad need of reform.  In case anyone needed reminding, paidContent covered Pandora’s CEO Joe Kennedy’s recent speech at the NARM music conference in San Francisco.  The article’s headings say it all:

  • “The complexity of international copyright limits Pandora’s business.”
  • “How huge damages in copyright law have skewed business relationships.”
  • “Our definition of ‘copies’ might need to change for the digital age.”

That’s a pretty good summary of precisely where copyright law has gone wrong.  Be sure to check out the full article.

Head in the cloud

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Amazon launched its Cloud Player yesterday which, as Wired explains,

can stream your music library to any web browser or Android mobile device. Cloud Player also allows you to download files and create playlists through its web-based interface.

So Amazon lets you store your music on a remote hard drive and stream it to local devices?  Sounds pretty straightforward.  Of course, the record labels don’t think so.  From Ars Technica:

We wondered aloud how Amazon managed to strike such an impressive licensing deal with the record labels, given the fact that Apple seems to still be working out the details for its own digital locker service. It turns out that Amazon hasn’t struck a deal, and seems to be hoping that the record companies will be the ones to blink.

“[W]e do not need a license to store music in Cloud Drive,” Griffin added in an e-mail to Ars. “The functionality of saving MP3s to Cloud Drive is the same as if a customer were to save their music to an external hard drive or even iTunes.”

That’s certainly not what the music industry seems to think, though—at least in regards to Cloud Player. In an interview with Reuters, Sony Music spokesperson Liz Young said the company hoped for a license deal but that it was keeping its “legal options open.”

Amazon certainly has made a gutsy play here.  The major labels are currently embroiled in a lawsuit against MP3tunes for providing essentially the same service as Amazon.  According to an amici curiae brief (PDF) in that case, the primary legal issue turns on whether or not Internet streaming necessarily constitutes a “public performance” (which would violate copyright owners’ rights unless licensed).  There is a powerful argument that it does not:

MP3tunes does not transmit music to the general public, nor to all of its subscribers. A particular work in a particular locker will only be transmitted to a user who has placed it there—in other words, after he or she has averred to MP3tunes that she either legally owns the file and have uploaded it to her locker, or that she has legal authorization to access the file on the Web and has sideloaded it into her locker. The subset of MP3tunes users who have uploaded or sideloaded any one particular track (and thus have stated to MP3tunes that they are authorized to do so) still falls far short of the “public” required by the transmit clause.

Of course, the simple fact that it has become necessary to make this legal argument illustrates just how broken copyright law is.  The statute is long, complicated, and muddled enough to lend at least some plausibility to virtually any argument imaginable.  Even an argument claiming that storing one’s own music on a private, password-protected server for convenience violates the letter (if not the spirit) of copyright law.

Stay tuned…

Updated 3/31/2011: Ars Technica has a follow-up piece today that quotes from their interview with MP3tunes’ CEO Michael Robertson (bio from his blog):

The word “streaming” and the word “download” are nowhere in copyright law.  It may be a very logical, common sense position, but all that matters is what the law says. Can you store your own music? Can you listen from anywhere? What if your wife or kids want to listen to it? All those things are completely unchartered [sic] territory.

Of course, as we routinely point out around here, “logic” and “common sense” have absolutely nothing to do with the current state of U.S. copyright law.

Sociological involvement in Walmart Supreme Court case

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The Supreme Court is about to hear arguments in a large class-action lawsuit against Walmart regarding female employees receiving lower pay. Interestingly, a sociologist is in the middle of the case:

Plaintiffs in the class-action suit, who claim that Wal-Mart owes billions of dollars to as many as 1.5 million women who they say were unfairly treated on pay and promotions, enlisted the support of William T. Bielby, an academic specializing in “social framework analysis.”

A central question in the case is whether he should have been allowed, in preliminary proceedings, to go beyond describing general research about gender stereotypes in the workplace to draw specific conclusions about what he called flaws in Wal-Mart’s personnel policies.

“Bielby made a conclusion that he had no basis to make,” said Laurens Walker, one of two University of Virginia professors who coined the term for the analysis almost 25 years ago. “He hasn’t done the research.”

But a brief supporting the plaintiffs from the American Sociological Association said that Professor Bielby’s work explaining how Wal-Mart’s policies may have led to discrimination “is well within our discipline’s accepted methods.”

Read the full article to find out more about the academic debate over social framework analysis. It sounds like what is it at stake is whether Bielby can make claims about organizational culture and how it might relate to this case without specific data from Walmart.

You can read the American Sociological Association’s (ASA) amicus brief here. It looks like this is the first such brief filed by the ASA since a 2006 case regarding a challenge to “Don’t Ask, Don’t Tell.” Digging a bit into the ASA amicus brief, the “summary of argument” provides some insights into what “social framework analysis” is:

“Social framework analysis” is not a sociological method, but rather a legal term for some kinds of research. What constitutes high quality “social framework analysis” continues to be vigorously de-bated among scholars. As such, the Court should assess the underlying social science methods, as practiced by social science researchers and vetted in the peer-reviewed journals of those fields, instead of the “social framework analysis” construct when deciding whether social scientific work is valid.

Systematic social science research has shown that corporate culture may affect individual-level decision-making in common ways. Corporate culture is a set of norms and values that convey messages to em-ployees about appropriate behavior. Corporations may actively try to engineer corporate cultures by implementing policies and practices that convey norms and values. Informal cultures also emerge in the workplace when employees interact, and may either reinforce or resist formal culture as well as promote other non-sanctioned norms. The extent to which corporate cultures, both formal and informal, influence individuals’ behavior depends on the strength of the cultures and also on the degree of discretion that company personnel policies give to individual decision-makers…

Namely, corporations have been shown to reduce gender disparities by instituting formal personnel policies, creating accountability processes for managers, and self-monitoring their employment patterns in order to highlight and address disparities. Extensive research in sociology and other social sciences has shown that these practices equalize gender dis-parities in the workplace by placing central checks on individual discretion that leads to biased decision-making, but do not eliminate all discretion from managerial practice. (pages 3-5)

It will be interesting to see what the Supreme Court decides, even if they are just ruling on whether the large class-action suit can go forward.

Two ways to deal with drug offenders

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Whatever your stance on U.S. drug policy, I think few people could disagree that courts deal with infractions very differently depending on who is breaking the law, as two recent news items painfully illustrate.

Way #1:  Throwing the Book at Them

This American Life has a podcast this week telling

the story of Lindsey Dills, who forges two checks on her parents’ checking account when she’s 17, one for $40 and one for $60, and ends up in drug court for five and a half years, including 14 months behind bars, and then she serves another five years after that—six months of it in [Georgia’s] Arrendale State Prison, the other four and a half on probation.

Listening to the hour-long program, I thought I had mistakenly swapped the podcast out for a Dickens and/or Kafka audiobook.

Ms. Dills is, needless to say, not particularly wealthy or well-connected…

Way #2:  Making Them Sing

…unlike the subject of today’s Daily Mail article:

Singer-songwriter and marijuana enthusiast Willie Nelson could have faced a lengthy jail term after he was arrested for possession in November.

But perhaps the Texas prosecutor has been smoking some of Willie’s special cigarettes, because he has agreed to let the 77-year-old legend avoid prison but only if he gives the court a song.

Hudspeth County Attorney Kit Bramblett said: ‘I’m gonna let him plead, pay a small fine and he’s gotta sing “Blue Eyes Crying in the Rain” with his guitar right there in the courtroom.’

In addition to the injustice implicit in the wildly divergent outcome faced by Mr. Nelson, I have the same question for the prosecutor and judge as a commenter over at the ABA Journal website:

Isn’t there some personal benefit in the “command performance”?  Charges should be settled for the state, not the personal benefit of court officers.

Updated 3/30/2011: The Associated Press is now reporting that Willie won’t have to sing after all.  The prosecutor was just “joking”.

The fair use dragon

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Justin Levine over at Against Monopoly points us to a controversy at the recent San Francisco International Asian American Film Festival and reminds us that many content owners believe that fair use in U.S. copyright law is about as real as a mythical fire-breathing creature.

John Diaz of the San Francisco Chronicle explains:

"Slaying the Dragon: Reloaded," a compelling new documentary that critiques the portrayal of Asian women in U.S. visual media, has drawn protests from an unlikely quarter. It wasn’t from Hollywood, which was deservedly scoured for its depiction of Asian women in films from "Rush Hour 2" to "Sex and the City." It wasn’t from conservative commentators claiming political correctness run amok.

Instead, the objection to the documentary by Elaine Kim, a UC Berkeley professor of Asian American studies, emerged from six Asian American filmmakers just before its premiere last week at the San Francisco International Asian American Film Festival. Their complaint: that she used clips of their work without seeking their permission.

Never mind that fair use is written into the copyright statute and explicitly allows for “criticism” and “comment” and “scholarship.”  Never mind that Kim’s documentary seems to fall well within the guidelines laid out by the Documentary Filmmakers’ Statement of Best Practices in Fair Use – and that four separate companies write errors-and-omissions insurance for filmmakers based on the Statement guidelines.

No, the owners of films being criticized by Kim want to get paid:

The documentary addresses images of Asian American women in film, and while that is a worthy subject for a documentary and we respect Ms. Kim’s skills, as filmmakers, we do not consider this "fair use." Every filmmaker knows that he or she has to ask permission before using any intellectual property not belonging to him/her.

Using a clip of our films for review or promotional purposes is standard; however, using it in a documentary to illustrate that filmmaker’s point of view is a creative choice by the documentarian and therefore not subject to fair use.…We feel that Ms. Kim should either license our film footage properly for use in her documentary or remove it before the documentary’s world premiere at the upcoming San Francisco International Asian American Film Festival.

The Chronicle reporter was shocked, though readers of this blog shouldn’t be (unfortunately):

For me, as a journalist and champion of free expression, the upshot seemed clear: You cannot give the targets of social commentary the ability to veto it. Does anyone think for a second that the copyright holders of "Rush Hour 2" [which includes a scene where Chris Tucker and Jackie Chan are presented with a buffet of scantily clad Asian women] would consent to allow scenes of that movie to appear in Kim’s documentary at any price?

Kim did end up screening the movie at the festival, but

Kim deleted the clip from "The People I’ve Slept With."

"We did not remove the clip because we were concerned it was not fair use," Kim emphasized in an e-mail. "We removed it because we do not have the time or resources to fight against a filmmaker that personally attacked us and was being unreasonable."

Given the brutal economic and personal realities of litigation, Kim probably made the “right” choice.  Even if she found lawyers to represent her for free, fighting this in court would probably consume a large portion of her personal time and energy for years.  I certainly don’t blame her for her apparently rational choice.

Nevertheless, let us be clear:  this is what happens when copyright law is written to give one side (i.e., copyright owners) sweepingly clear rights but the other side (i.e., fair users) only an amorphous defense.  You don’t get copyright as “an engine of free expression”, as the Supreme Court continues to think.  You get censorship by people who think that fair use is a fairy tale.

Status update: P2P still in litigation

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Nate Anderson at Wired reminds us that “the first file-sharing case in the US to go all the way to trial is still going”:

Filed on April 19, 2006 and progressing through a remarkable three trials, the recording industry case against Minnesota resident Jammie Thomas-Rasset continues to burn through cash and judicial attention.

Thomas-Rasset was at first hit with a $222,000 fine in 2007, which was set aside in 2008. Another jury trial in 2009 ended with a $1.92 million judgment, which was set aside in 2010. In November 2010, a third trial ended with a $1.5 million verdict, which the judge is unlikely to allow (his previous orders suggested that a few thousand dollars per song would be the maximum permissible damages). At the moment, both sides are still arguing over the appropriateness of that $1.5 million damages award.

Almost five years.  Three trials (so far).  What a colossal waste of economic, judicial, and personal resources.