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.

My PhD thesis is available here: Digital constitutionalism and the role of the rule of law in virtual communities.

Abstract:

This thesis considers one main question: how should we regulate the exercise of private governance power in virtual communities? This question centres on the legitimacy of governance in the way that community norms are created and enforced. This is the project of digital constitutionalism, which seeks to articulate a set of limits on private power that will best encourage innovation and autonomy and simultaneously protect the legitimate interests of participants in these increasingly important spaces. In answering this question, I provide a normative framework based upon the broad ideals of the rule of law through which to conceptualise the tensions about governance that arise in virtual communities.

The rule of law framework provides a constitutional discourse through which to examine the structure and practice of power relations in virtual communities. The standard model for conceptualising disputes between participants and providers of virtual communities has so far generally been based upon a classical model of contractual relations, and this has been supported by normative claims for a hands-off regulatory approach. This contractual governance model slowly replaces the law of the state with the private rules of the providers of virtual communities which mostly do not carry the same expectations of legitimacy. As this process continues over an increasingly wide range of human activity, there is a very real threat that the constitutional principles that we value begin to fade in relevance, leaving participants vulnerable to abuses of power in online spaces.

The contours of private law — and particularly contract law — provide the limits of permissible and legitimate private governance in these communities. The legal framework provides constant support and shapes the boundaries of internal governance. The rule of law legitimises governance in two senses here — it provides justification for the exercise of private power, but it also restrains the exercise of that power to make it more transparent, impartial, and fair. It is for these reasons that the bounds of the legal framework are critically important for the practise of governance; internal governance proceeds entirely in the shadow of the law, and the shape of the law changes the shape of the legitimate, permissible, and conceivable exercise of private power.

This thesis examines the flexibility in private law and argues that modern contractual doctrine should be informed by the values of the rule of law in order to provide a suitable regulatory framework that protects participants from abuses of power whilst remaining sensitive to the need to encourage innovation and investment in the development of virtual communities. This thesis provides a normative argument for the development of contractual doctrine and the exercise of judicial discretion in the resolution of disputes between participants and providers in a way that more accurately addresses the tensions of ongoing community governance. These disputes arise predominantly when either a participant or the provider seeks to enforce the rules of the community against the other; I focus, accordingly, on the way in which territorial states ought to support and limit the enforcement of community norms. I argue that the flexibility in the contractual framework should be exercised in a manner informed by the values of the rule of law. As a primary principle, this suggests that we should introduce appropriate limits on the contractual discretion of a provider to impose penalties and suspend or terminate a participant’s access to the community in line with the norms of the community. Additionally, I argue that providers should, in certain cases, be prevented from relying on contractual clauses that prevent participants from enforcing the rules.

In order to allow a contractual framework to be used to regulate governance in virtual communities, it must develop to more adequately conceptualise the role of punishment in the enforcement of community norms. Rule of law values suggest that these internal wrongs lack the requisite legitimacy to be directly enforceable and punishable by territorial law. This thesis accordingly argues that acts that are not recognisable as wrongs by the state but are only wrongs when viewed through the interpretative framework of community norms ought not to be punishable in territorial courts. It follows that criminal penalties are inappropriate for breach of internal norms, and also that civil remedies that have the practical effect of imposing penalties, like those available under copyright law and computer trespass torts and statutes, should not be available to fulfil a punitive function for breach of internal rules.

Rule of law values, however, also suggest that many virtual communities need the ability to impose punishments to maintain order within the community. I argue, accordingly, that the contractual framework must support the imposition of internal penalties where participants are able to avoid internal punishment, in addition to providing compensatory remedies to recover losses sustained through breaches of the rules. If the contractual framework is to be effective in fulfilling this role, I argue that we must further develop equitable remedies under contract law — specific performance and injunctive relief — to empower communities to enforce their own rules where they would otherwise be unable to. In providing the support that community governance requires, however, we must be extremely careful to differentiate between legitimate rules and enforcement mechanisms and illegitimate ones; both equitable and contractual remedies should accordingly only be available where the rules are clear, well promulgated, accepted and understood by the community, and applied in a fair and just manner.

This thesis concludes by examining the limits of the contractual governance framework, particularly the lack of privity between participants and other participants, and between participants or providers and external actors. The ability of courts to properly address disputes that arise outside of the contractual relationship between a participant and the provider depends predominantly on the evolution of other private law doctrines and the intersection of those doctrines with contract. For wrongs that are recognisable by territorial states, the contract provides an indicia of community norms, which delineate the scope of consent. Participants are accordingly able to enforce their rights in tort or other civil law actions against other participants with reference to the community norms, without necessarily relying on contractual remedies. Rule of law values also suggest that a provider may be liable, in some circumstances, for failing to enforce the rules of the community and, in addition, third party beneficiary doctrine will allow contractual enforcement in a limited but important set of circumstances. Nevertheless, some gaps exist, and participants within virtual communities may need assistance in order to enforce community norms within these gaps.

This thesis concludes that classical contractual doctrines provide an alienating and ill-fitting regulatory framework for virtual community governance, but that it can be significantly ameliorated through a conceptual framework provided by the values of the rule of law. The core problem is largely that community governance involves a set of constitutional tensions that are not able to be recognised in the standard contractual framework. If a contractual framework is to be used to regulate virtual communities, then, it follows that constitutional principles, and particularly rule of law values, ought to be used to inform the application and development of doctrine. If governance tensions can be assessed and addressed through a rule of law framework, then these private law forms may be able to provide a satisfactory approach to the regulation of private governance.

Over the last two days, I have been at the Copyright 2010 Conference hosted by the CIPL at ANU and organised by Dr Matthew Rimmer.

I presented two papers at this conference, one on moral rights and open licensing and another on graduated response schemes and the rule of law.

You can grab my slides for these here:

• Open licensing and moral rights (PDF)
• Graduated responses on the rule of law (PDF)

Abstracts below the fold:

Integrity, attribution, and exploitation: contractual and normative moral rights protection in open licensing

Over the last twenty years, the use of open content licenses has become increasingly and surprisingly popular. The use of such licences challenges the traditional incentive-based model of exclusive rights under copyright. Instead of providing a means to charge for the use of particular works, what seems important is mitigating against potential personal harm to the author and, in some cases, preventing non-consensual commercial exploitation. It is interesting in this context to observe the primacy of what are essentially moral rights over the exclusionary economic rights.

The core elements of common open content licences map somewhat closely to continental conceptions of the moral rights of authorship. Most obviously, almost all free software and free culture licences require attribution of authorship. More interestingly, there is a tension between social norms developed in free software communities and those that have emerged in the creative arts over integrity and commercial exploitation. For programmers interested in free software, licence terms that prohibit commercial use or modification are almost completely inconsistent with the ideological and utilitarian values that underpin the movement. For those in the creative industries, on the other hand, non-commercial terms and, to a lesser extent, terms that prohibit all but verbatim distribution continue to play an extremely important role in the sharing of copyright material. While prohibitions on commercial use often serve an economic imperative, there is also a certain personal interest for many creators in avoiding harmful exploitation of their expression – an interest that has sometimes been recognised as forming a component of the moral right of integrity.

One particular continental moral right – the right of withdrawal – is present neither in Australian law or in any of the common open content licences. Despite some marked differences, both free software and free culture participants are using contractual methods to articulate the norms of permissible sharing. Legal enforcement is rare and often prohibitively expensive, and the various communities accordingly rely upon shared understandings of acceptable behaviour. The licences that are commonly used represent a formalised expression of these community norms and provide the theoretically enforceable legal baseline that lends them legitimacy. The core terms of these licences are designed primarily to alleviate risk in sharing and minimise transaction costs in sharing and using copyright expression.

Importantly, however, the range of available licences reflect different optional balances in the norms of creating and sharing material. Generally, it is possible to see that, stemming particularly from the US, open content licences are fundamentally important in providing a set of normatively accepted copyright balances that reflect the interests sought to be protected through moral rights regimes.

As the cost of creation, distribution, storage, and processing of expression continues to fall towards zero, there are increasing incentives to adopt open content licences to facilitate wide distribution and reuse of creative expression. Thinking of these protocols not only as reducing transaction costs but of setting normative principles of participation assists in conceptualising the role of open content licences and the continuing tensions that permeate modern copyright law.

Tensions Between the Rule of Law and Graduated Response Schemes

The recent iiNet decision highlights an important tension in copyright law over the role of intermediaries in responding to what is seen as a crisis in rates of online infringement. Recent legislative developments in the UK, New Zealand, and France seek to require ISPs to terminate the accounts of subscribers suspected of infringing copyright on a number of occasions. The iiNet decision at first instance suggests that such a scheme cannot easily be implied as part of Australian authorisation liability and that a legislative scheme will likely be required if one is to be introduced.

The recent decision of the French Constitutional Council on the first iteration of a French graduated response scheme highlights fundamental rule of law concerns with the creation of an extra-judicial punitive regime designed to curb rates of copyright infringement. The desire to reduce the costs of copyright enforcement is problematic when considered against the requirements of due process, predictability, and transparency expected in liberal democratic theory. The crisis-management based goals of such schemes can also be difficult to reconcile with requirements of proportionality in the enforcement of legal rights. These problems compound with the increasing recognition that internet access is fundamentally important to all aspects of participation in society.

This paper examines these tensions and seeks to identify whether a scheme based upon the termination of internet access of households or individuals found to have infringed copyright can be compatible with rule of law theory. At a minimum, such a scheme is likely to require significantly more judicial oversight than has been proposed by the applicant-appellants in the iiNet litigation. Whether it is possible to decrease enforcement costs without unduly sacrificing due process is likely to be an ongoing debate over the immediate future.

Last week I submitted my PhD thesis (‘Digital Constitutionalism and the role of the rule of law in the governance of virtual communities’) for examination. I hope to hear back in the next six weeks, in time for graduation in July.

I will be taking twelve months leave from my teaching at QUT to spend the 2010/11 academic year in the US. My partner, Kylie, has enrolled in an LLM program at Georgetown University, and I will work on some of my own research there.

This also means I am available for work in the US over the next year; if anyone has anything they would like to collaborate on, or knows of some interesting work I could do, please drop me a line (nic at suzor dot com).

Last month, I was interviewed by 4ZzZ’s Zed Games show on the introduction of an R18+ rating in Australia. The show also includes an interview with Gamers 4 Croydon. You can grab the mp3 here: 20100218-ZedGames-R18-EFA-G4C.

Thanks a lot to Ray and Chani for having me on the show. It’s great to see a gaming show on prime-time community radio, and I’m really excited to hear future episodes.

Kylie Pappalardo has an excellent case note on Telstra Corp Ltd v Phone Directories Pty Ltd [2010] FCA 44 (Full decision). This case continues the process that began when the High Court tightened the requirements of originality and authorship in IceTV, applying that logic to contain the previous FCAFC authority of Telstra v Desktop Marketing to its facts. The result is very interesting for Australian copyright law: there is no longer any certainty that telephone directories will be protected by copyright, bringing Australia more into line with international authority on this point.

[ reposted from EFA ]

Michael Geist is reporting that the text of the secret Anti-Counterfeiting Trade Agreement (ACTA) chapter on internet enforcement has been leaked. As suspected, the text is unlikely to require major changes to Australian law, but it does do two very concerning things:

• Increased pressure on intermediaries (ISPs) to monitor and police their networks: in the recent iiNet litigation, the Federal Court found that ISPs were under no obligation to terminate the accounts of subscribers that the film industry alleged (without proof) were infringing copyright. This is a contentious point, and we expect to see the copyright industry lobby for legislative change. The ACTA provides them with more ammunition to argue for a three-strikes policy, which is unfortunate.
• Increased entrenchment of the harshest level of copyright sanctions: my biggest concern with ACTA is what it means for the way that international copyright law is developed. Copyright is such an important part of the framework that governs the way that we interact online – it underpins nearly every aspect of modern communication. Because the balance between providing authors with an incentive to create and users with the ability to access is so critically important, the way in which copyright policy is made is also critically important for a society. The ACTA, a secret plurilateral agreement, ensures that the role of the public is minimised, allowing corporate rightsholders to set the agenda for copyright policy.

See Michael Geist’s blog for more information:

The draft chapter finally puts to rest the question of whether ACTA in its current form would establish a three strikes and you’re out model. The USTR has recently emphatically stated that it does not establish a mandatory three strikes system. The draft reveals that this is correct, but the crucial word is mandatory. The draft U.S. chapter does require intermediaries to play a more aggressive role in policing their networks and the specific model cited is the three-strikes approach. In other words, the treaty may not specifically require three-strikes, but it clearly encourages it as the model to qualify as a safe harbour from liability. The specific provision, which is another pre-requisite for intermediary safe harbour from liability, states:

an online service provider adopting and reasonably implementing a policy to address the unauthorized storage or transmission of materials protected by copyright or related rights except that no Party may condition the limitations in subparagraph (a) on the online service provider’s monitoring its services or affirmatively seeking facts indicating that infringing activity is occurring;

And what is an example of a policy provided in ACTA? The treaty states:

An example of such a policy is providing for the termination in appropriate circumstances of subscriptions and accounts in the service provider’s system or network of repeat infringers.

This leaks shows how deceptive the USTR has been on this issue – on the one hand seeking to assure the public that there is no three-strikes and on the other specifically citing three strikes as its proposed policy model. Given the past U.S. history with anti-circumvention – which started with general language and now graduates to very specific requirements – there is little doubt that the same dynamic is at play with respect to three strikes.

Of course we already have such a requirement in Australian law, but the iiNet decision means that ISPs do not need to rely on the safe harbours in order to avoid secondary copyright liability. By continuing to push this idea, though, the copyright lobby threatens to change the discourse – and influence the legislature – to make it much easier to introduce three-strikes in the future.

A core chapter of my PhD has just been accepted for publication as an article by Berkeley Technology Law Journal. You can view the pre-print here: The Role of the Rule of Law in Virtual Communities (forthcoming BTLJ 2011) (PDF).

There is a severe tendency in cyberlaw theory to delegitimize state intervention in the governance of virtual communities. Much of the existing theory makes one of two fundamental flawed assumptions: that communities will always be best governed without the intervention of the state; or that the territorial state can best encourage the development of communities by creating enforceable property rights and allowing the market to resolve any disputes. These assumptions do not ascribe sufficient weight to the value-laden support that the territorial state always provides to private governance regimes, the inefficiencies that will tend to limit the development utopian communities, and the continued role of the territorial state in limiting autonomy in accordance with communal values.

In order to overcome these deterministic assumptions, this article provides a framework based upon the values of the rule of law through which to conceptualise the legitimacy of the private exercise of power in virtual communities. The rule of law provides a constitutional discourse that assists in considering appropriate limits on the exercise of private power. I argue that the private contractual framework that is used to govern relations in virtual communities ought to be informed by the values of the rule of law in order to more appropriately address the governance tensions that permeate these spaces. These values suggest three main limits to the exercise of private power: that governance is limited by community rules and that the scope of autonomy is limited by the substantive values of the territorial state; that private contractual rules should be general, equal, and certain; and that, most importantly, internal norms be predicated upon the consent of participants.

A few weeks ago I lodged EFA’s submission on legitimacy and transparency in Mandatory ISP Filtering, written by myself, Kylie Pappalardo and Irene Graham. We received a lot of negative feedback at EFA for engaging with the DBCDE on this issue, but I think it’s very important. Stepping back from my opposition to the Labor Government’s plan to introduce mandatory filtering, the issue is theoretically quite complex.

I oppose filtering on three main grounds:

1. it’s security theatre – it cannot, in its current form or any currently imaginable forms, provide greater security for Australians, and will certainly not help in combatting child sexual exploitation;
2. the current plan is ludicrously ill-defined; the goals are not clear, and there is no indication of how the filter is meant to achieve those goals;
3. there is a great risk to liberal democratic ideals when the government begins to censor material based on unaccountable procedures and criteria.

I think it’s important to note that I am not ideologically opposed to filtering; I think that there are, at least in theory, legitimate ways in which the government can impose restrictions on the material that is available online. I am acutely opposed to the current plan, but it is important to explain why I am opposed and avoid extremist conceptions that would undesirably tie the hands of democratically elected government in regulating online speech.

This submission addresses the third issue only. It attempts to map a framework for when mandatory filtering may be legitimately imposed. In doing so, as I said, we have received some negative feedback from those who believe it would have been better to maintain absolute opposition to any filtering scheme. I have to disagree here; the framework we set out in this paper sets very high standards of accountability in filtering that would, if reached, mean that my concerns about legitimacy would be greatly alleviated. (As a side note, in terms of the campaign, I believe that it is better to be involved in the development of policy than to maintain a strictly outsider position.)

I think that this paper makes a strong argument in addressing the concerns about legitimacy in Labor’s ill-defined filtering scheme, and I particularly want to thank Kylie Pappalardo and Irene Graham for their crucial help in putting it together.

• EFA’s submission to DBCDE transparency consultation (PDF)