By: Shelby Rokito. Penn Law Class of 2018
On January 28, 2016, the Department of Commerce’s Internet Policy Task Force published its White Paper on Remixes, First Sale, and Statutory Damages. The report is a collaborative effort led by the U.S. Patent and Trademark Office and the National Telecommunications and Information Administration. In drafting the White Paper, the Internet Policy Task Force considered comments from stakeholders with varied interests, including artists, public interest groups, Internet companies and scholars. The culminating report contains recommendations for changes to the Copyright Act, specifically with respect to three hot-topic issues in the area of copyright policy.
Created in 2010, the Internet Policy Task Force was charged with monitoring the issues of cybersecurity, global information circulation, privacy, and copyright as they continue to evolve in an ever-changing digital environment.1 Copyright protections have become particularly sensitive in the Internet age. As the White Paper states, “[t]he tools available in the digital ecosystem have changed the nature of what creators can produce and how they share works with the public, and the ways the public can access and interact with the content.”2 Recognizing that innovations brought by the Internet and related digital technologies have posed unique challenges for remixing, the first sale doctrine, and statutory damages, this report balances the respective concerns of diverse stakeholders to propose solutions that are both practical and legislative.
With the rise of platforms such as YouTube, SoundCloud, and the like, remixing has become ubiquitous among Internet users. Remixing has produced valuable creative contributions, which has many mash-up advocates calling for less in the way of regulation and more in the way of rights.3 Fortunately for remix renegades, the Task Force is not interested in creating more restrictions on remixing. Instead, the key issue to be addressed is that of insufficient transparency.
A major problem is that remixers are often unsure of when a use qualifies as “fair use” and when they must attain licenses. To further the goal of increasing transparency, the Task Force suggests: (1) setting forth clear, negotiated guidelines that explain how fair use applies to remixes, (2) making voluntary licensing options more available, and (3) improving efforts to educate the public about what constitutes fair use.
The First Sale Doctrine, codified in §109 of the Copyright Act,4 states that one who knowingly buys a copy of a copyrighted work from the copyright holder obtains the right to distribute that particular copy. First sale protects defendants in copyright cases by allowing them to claim that they sincerely believed the works they were selling constituted a legitimate first sale.5 In its consultations with the various stakeholders who contributed to this report, the Task Force also found that first sale “provides many benefits to the public, including sharing favorite books with friends, enabling libraries to lend materials to their patrons, and providing reduced-price versions to impecunious students.”2
Despite recognizing the value added by first sale, the Task Force was reluctant to extend the doctrine to digital transmissions. Finding “insufficient evidence” to support an amendment, the White Paper instead shifts the burden to copyright owners to act as “rational commercial actors.”2 With respect to first sale, the Task Force’s only affirmative recommendation is to increase consumer awareness regarding the risks they assume when downloading copyrighted works. The White Paper explicitly calls for the formation of a “multistakeholder process” to implement best practices for engaging in online transactions involving creative works.2
The White Paper explored statutory damages last; this is the only area where the Task Force calls for tangible amendment to the Copyright Act. Recognizing the difficulty of assessing economic harms flowing from file sharing in the Internet environment, the White Paper proposed three changes: (1) create a list of factors for courts and juries to take into account when calculating damages, (2) expand eligibility for “innocent infringement” damages awards, and (3) provide courts with discretion to assess damages other than on a strict per-work basis when it comes to non-willful secondary liability for online services offering a large quantity of works.2 In addition to these amendments, the Task Force suggested the possibility of setting up a small claims tribunal to ameliorate the number of disproportionate damages claims filed against individual file-sharers.
What To Make of These Changes?
The proposed changes represent an important shift in copyright policy. The Internet Policy Task Force exerted a significant amount of time, energy, and resources in gathering empirical data as well as diverse viewpoints regarding how to bring copyright policy up to speed with the current pace of the digital age. The proposed amendments to the statutory damages provisions of the Copyright Act are especially exciting, as they represent concrete proposals that have the potential to bring about palpable change.
Unfortunately, we are unlikely to see real change in the immediate future. The Internet Policy Task Force is an agency of the Department of Commerce, which advises President Obama. The only entity with the power to implement these amendments is Congress. Though Congress may take into account the information contained in the White Paper, this does not mean the recommendations will simply be adopted.
Over a century ago, Mark Twain expressed his frustrations with the status of copyright law, asserting: “only one thing is impossible for God: to find any sense in any copyright law on the planet.” Since then, the advent of digital technologies has arguably destroyed any “sense” that copyright law acquired along the way. The Internet has profoundly altered what it means to truly own a work. 100 years later, it seems that Twain would not be far off if he made the same statement today; for better or for worse, the more things change, the more they stay the same.
We hope you continue to follow us as PIPG continues to monitor new developments in copyright policy.
1. United States Patent Office. Internet Policy Task Force. (Last Visited Feb. 10, 2016). Retreived from http://www.uspto.gov/learning-and-resources/ip-policy/copyright/internet-policy-task-force.
2. White Paper on Remixes, First Sale, and Statutory Damages. http://www.uspto.gov/sites/default/files/documents/copyrightwhitepaper.pdf
3. Murray, B. (2015, March 22). Remixing Culture and Why the Art of the Mash-Up Matters. http://techcrunch.com/2015/03/22/from-artistic-to-technological-mash-up/
4. U.S. Copyright Act. U.S. Code Title 17. https://www.law.cornell.edu/uscode/text/17
5. Office of the U.S. Attorneys. Criminal Resource Manual 1854. Copyright Infringement—First Sale Doctrine. http://www.justice.gov/usam/criminal-resource-manual-1854-copyright-infringement-first-sale-doctrine