In a recent publication with Ericsson, we call for more principled development of copyright law and, particularly, greater emphasis on creating cheap, easy, and quick legal distribution channels (as opposed to harsher, cheaper, and quicker enforcement mechanisms).

Most of this is pretty straightforward – we need more evidence in our policy development. Importantly, however, we need to think harder about how we can create efficient and attractive solutions for people to actually access copyright content, rather than focusing on three-strike regimes and similar developments.

A one sided approach which enforces copyright at the expense of all other stakeholders and the digital competitiveness of nations is not the cure for the problem nor a treatment of the symptoms. Economic history has already taught us well that a monocausal explanation of complex processes and hence one-sided solutions will not work.

Any future copyright enforcement policy should be developed from a clear and evidence-based approach. An approach that carefully balances the incentives and rewards provided to economic rights holders against fundamental rights of privacy, self-expression, due process and the user rights embodied in copyright law to protect
access, learning, critique, and reuse.

Future enforcement policies should be proportional and flexible recognizing that historical rates of copyright infringement and the decline in physical sales, may also be a reflection of market conditions, various forms of access barriers, failed strategy and increased competition from; lawful digital distribution services, other platforms such as Music in TV and Gaming) and live performances – all legitimately displacing physical sales.

This paper suggests that, adequate enforcement measures are certainly part of a solution to a well functioning lawful digital market. However, enforcement alone can never
solve the root cause of unlawful file-sharing, since it utterly fails to address supply-side market barriers. Focus on enforcement measures alone continues to leave out a
legitimate but un-served market demand, susceptible to unlawful alternatives. A competitive and consumer friendly digital content market and an appropriate legal framework
to enable easy lawful access to digital content are essential preconditions for the creation of a culture of lawful, rather than unlawful, consumption.

Rene Summer, Nicolas Suzor, and Patrick Fair, ‘Copyright Enforcement in the Networked Society: Guiding Principles for Protecting Copyright’ (2011, Ericsson).

In an attempt to curb online copyright infringement, copyright owners are increasingly seeking to enlist the assistance of Internet Service Providers to enforce copyright and impose sanctions on their users. Commonly termed ‘graduated response’ schemes, these measures generally require that the ISP take some action against users suspected of infringing copyright, ranging from issuing warnings, to collating allegations made against subscribers and reporting to copyright owners, to suspension and eventual termination of service.

This article highlights fundamental tensions between graduated response schemes and the rule of law, a fundamental tenet of the Australian legal system. Graduated response schemes shift the task of adjudicating upon and enforcing copyright away from the courts and onto intermediaries. This shift is designed to reduce enforcement costs and avoid the public relations problems associated with the large scale litigation campaigns the copyright industry has previously adopted in the United States. The weakening of judicial oversight, however, poses significant problems for legitimacy. In most common forms, graduated response schemes are highly problematic with regards to due process, the proper exercise of the judicial power of the Commonwealth, and respect for the rights of Australian internet users.

Nicolas Suzor and Brian Fitzgerald, “The legitimacy of graduated response schemes in copyright law” (2011) 34(1) University of New South Wales Law Journal 1.

Kylie Pappalardo and Nicolas Suzor, “Standardisation and patent ambush: Potential liability under Australian competition law” (2011) 18 CCLJ 267, here.

This article examines the problem of patent ambush in standard setting, where patent owners are sometimes able to capture industry standards in order to secure monopoly power and windfall profits. Because standardisation generally introduces high switching costs, patent ambush can impose significant costs on downstream manufacturers and consumers and drastically reduce the efficiency gains of standardisation.This article considers how Australian competition law is likely to apply to patent ambush both in the development of a standard (through misrepresenting the existence of an essential patent) and after a standard is implemented (through refusing to license an essential patented technology either at all or on reasonable and non-discriminatory (RAND) terms). This article suggests that non-disclosure of patent interests is unlikely to restrained by Part IV of the Trade Practices Act (TPA), and refusals to license are only likely to be restrained if the refusal involves leveraging or exclusive dealing. By contrast, Standard Setting Organisations (SSOs) which seek to limit this behaviour through private ordering may face considerable scrutiny under the new cartel provisions of the TPA. This article concludes that SSOs may be best advised to implement administrative measures to prevent patent hold-up, such as reviewing which patents are essential for the implementation of a standard, asking patent holders to make their licence conditions public to promote transparency, and establishing forums where patent licensees can complain about licence terms that they consider to be unreasonable or discriminatory. Additionally, the ACCC may play a role in authorising SSO policies that could otherwise breach the new cartel provisions, but which have the practical effect of promoting competition in the standards setting environment.

Every time I log on to Amazon’s website, I’m presented with a Kindle advertisement that seems quite simple and stresses the ‘bestselling’ nature of the device. When Kylie logs on, her Kindle advertisement is covered with pink love hearts.

The 9th Circuit has reversed the MDY v Blizzard (WoW Glider) case on the secondary copyright infringement grounds (but not one of the DMCA claims).

This is important; the district court had held that players infringe Blizzard’s copyright in WoW by playing the game in breach of the rules, primarily because the prohibition on botting was sitting next to a prohibition on reverse-engineering etc. The district court held that it was a condition of the licence grant, and that therefore players infringed when using glider, and that MDY was liable for their infringement.

The 9th Circuit held instead that the prohibitions on botting were contractual covenants. I think this reading fits much better with Sun v Microsoft and common sense (they’re clearly gameplay rules, not rules designed to protect Blizzard’s copyright interests).

“Were we to hold otherwise, Blizzard — or any software copyright holder — could designate any disfavored conduct during software use as copyright infringement, by purporting to condition the license on the player’s abstention from the disfavored conduct. The rationale would be that because the conduct occurs while the player’s computer is copying the software code into RAM in order for it to run, the violation is copyright infringement. This would allow software copyright owners far greater rights than Congress has generally conferred on copyright owners.” ([11])

In the long term, I think this is important because copyright provides remedies for infringement that become punitive when used to enforce game rules, whereas the more compensatory remedies available under contract do not, in general. (I have a pre-print of an article on this point, if anyone is interested I can send it through.)

In the direct circumstances of the case, though, this is not a big win for MDY. They’re still liable on one of the DMCA circumvention claims (access) and will likely be found liable for tortious interference with contract.

On Terra Nova, Greg Lastowka announces that his new book, Virtual Justice, is on bookshelves now. I had the opportunity to read the manuscript a little while ago, and can highly recommend the book to anyone interested in the regulation of virtual worlds.

As I mentioned in an earlier post, and as you can probably see, I’m turning this site into more of a personal blog. If you want to only see legal updates, you can subscribe to this law only RSS feed (or view here).

— nic

[ from the allocation-of-resources dept ]

You may have noticed I haven’t said much around here lately. I’ve been putting most of my energy into my academic writing – first my dissertation, and now a book and some articles. This leaves little time to blog.

Over the next few weeks, I’m going to transition this site to more of a personal homepage and less of a blog. I’ll still have the occasional writeup of particular issues or events I’m interested in, but the rest of the content will become more (explicitly) static and may include a greater mix of my other interests, like photography. Accordingly, if you don’t want to see pictures of kittens, you may want to unsubscribe from the feed.*

* I don’t actually expect to be posting many pictures of kittens. But you get the point – content is likely to be more personal and less academic from here on.

I’m in Edinburgh to present at DIS:E run by Ren Reynolds and Andrés Guadamuz.

My talk is on, predictably enough, the rule of law and legitimacy in virtual community governance. Particularly, I want to focus on two main ways that we can look at things differently: looking at the limits of contract rather than only the contractual terms themselves; and looking at procedural legitimacy rather than substantive rights. My slides are here in PDF.

I have arrived in Washington DC, where I’ll be a visiting researcher at Georgetown University Law Center for the 2010 / 11 academic year.

My main project over this time is to write my book on the governance of virtual communities. I’ll also be working on some new material on graduated response schemes in IP and also on open licensing.

If you’re in the area, or know of any great events I should get to, please let me know.