SOPA on a Rope?

There has been an immense amount of talk lately regarding a bill currently making its way through US Congress known as the Stop Online Piracy Act (or SOPA).  SOPA has been fashioned as an effective response to rampant online piracy of copyrighted content by granting the Attorney General rather broad and sweeping powers to attack infringing websites. The law also gives individual rights holders a new procedure complete with remedes they’ve never had access to before.

The bill is a companion to the equally controversial PROTECT IP act, also being debated by congress. These two bills signify a sharp change in the American copyright landscape, specifically as it pertains to the Internet.

In addition to granting the Attorney-General the power to obtain a court order against a site that is either “committing of facilitating online privacy”, he may also order third party payment providers (such as Visa or PayPal) and online ad networks to stop supporting and dealing with the site in question.

photo by mikeleeorg

Furthermore, the Attorney-General may order the de-indexing of allegedly infringing sites from search engines.  Many have likened this rather extreme measure to the Internet censorship protocols enacted by the Chinese government (known coloquially as ‘The Great Firewall”).  While this may be a slightly extreme appraisal, this measure in particular brings up significant free speech issues.

As mentioned above, not only the Attorney-General but regular rights holders have been given powerful enforcement tools.  If a rights holder believes a site is infringing their copyright, they must undertake a two step process: First, they must contact payment providers and ad networks doing business with the site in question.  Upon forwarding them a compliant, they are to cease their service in relation to the website and forward the complaint to the owner of the domain. At this point, the site owner must reply and explain how their activities are not infringing copyright (eg. the material is legally licenced, fair use etc.).  if they do not, the rights holder may apply to a court for a limited injunction on the website.  

SOPA tries to incentivize the voluntary coming forward of ad and payment networks by extending them immunity from liability if they ”squeal” on an instance of copyright piracy or trademark infringement.

Finally, the bill expands the penalties related to certain activities including streaming video and various instances of counterfeiting.

Supporters of the bill tout it as the weapon American rights holders need to effectively police their IP rights. Supporting organizations include the obvious players such as the Recoding Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA) but also large commercial entities like Nike, Ford and Pfizer.  SOPA would presumably make it easier for those large entities to enforce their trademark rights, adding to the ICANN Uniform Dispute Resolution Policy (UDRP).  While the latter only allows rights holders to go after infringing domain names, SOPA would allow them to pursue websites that make use of their trademarks in the actual content of the site itself.

Detractors contend that the bill is an absolute outrage and must be killed immediately. Representatives on both sides of the house have been outspoken critics, among them Rep. Nancy Pelosi and current Republican nominee for presidential candidacy Rep. Ron Paul.  In Rep. Paul’s own words, SOPA will likely result in "an explosion of innovation-killing lawsuits and litigation.”

Some even question the efficacy of the bill.  Sure the Attorney-General may order sites banned form the American web, but the DNS can be manipulated in creative ways to circumvent this roadblock. As was born witness to during this years “Arab Spring”, people can use mirror and proxy servers to get around national quarantines of the Internet.

The advent of these new measures also brings into question the utility of the DMCA’s notice and take-down system.  If SOPA passes, it will create a far stronger mechanism than what the DMCA currently offers thereby rendering those remedies obsolete. Unfortunately, the DMCA notice and take-down represents  significantly more balanced approach to dealing with piracy on the Internet than does the potentially Ex Parte (legal jargon meaning a hearing absent one of the parties) process put in place by SOPA. The latter allows actions to be taken against the infringing site itself if the Attorney-General is unable to locate the owner of the site.

It remains to be seen what type of effect SOPA and PROTECT IP will have in the Internet landcsape in the US.  The question also beckons as to whether any other countries will follow suit with national legislation of their own in the same vein.  Being the worlds largest exporter of Intellectual Property, the United States has a vested interest in seeing IP laws around the world tighten.  Here in Canada, our copyright modernization act (currently making its way through Parliament) seems to already reflect that exported interest.  The last thing Canada needs right now is “SOPA North”.  However, since “Stephen” and “Barack” are such good buddies these days, who knows what could happen?

Chanel gets TRO against 700 sites alleged to be selling counterfeited products infringing Chanel's Marks

A Federal Court judge sitting in the State of Nevada sided with Chanel when it asked to have approximately 700 domain names seized.  The sites allegedly contained counterfeit luxury goods including those of the plaintiff Chanel.  

Not only did the judge order the seizure of these domains, ha also ordered major social media sites like Google+ and Facebook and Twitter as well as search engines such as Google, Bing and Yahoo to de-index the targeted sites from their databases.

It seems that most of the investigatory work was done in house, though according to Ars-Technica, Brandon Tanori, a Nevada based private investigator, was called in to investigate a few of the sites in question.

Chanel is the owner of some 22 registered trademarks covierng a number of incarnations of is logo and company name. examples of some of the site names include: cheapchanelreplica.com, replicachanelhandbag.net, and replicachanelshoes.com.

While the case has not yet gone to trial, Judge Kent Dawson granted the TRO (Temporary restraining order) requested by Chanel.  The TRO orders the domain name registrars currently in possession of the domain names in question to transfer those domains to an American registrar, GoDaddy.com who has been tasked with holding the domain names in trust for the court until conclusion of the pending action.

As mentioned above, the TRO also ordered search engines and social media sites to de-index the sites in question from their data-bases. The order makes no mention of the plaintiffs obligation to re-reimburse these 3rd party sites for the operational costs associated with the de-indexation.

While some have criticized the decision and evidence considered as being “one sided”, it should be noted that this judgement was rendered ex parte (meaning without all the parties present).  Normally, the rules of fundamental justice require that a party have the opportunity to appear and make it’s arguments known (the principle of Audi Alterem Partem).  The complaining party must at least serve notice of the action on the defendants.  

Given the nature of the case and the fact that the defendants are located around the world and that the information they provided to their respective registries may be false, the judge allowed for service by posting of a website: http://servingnotice.com/sdv/index.html.  Here, defendants can access PDF versions of all the court proceedings taken up to this point. This is a rather interesting new take on service by publication which many jurisdictions often use as an alternative when “personal” or “substitute” service are impossible. Service by publication usually requires leave of the court.

As pointed out by Ars Technica’s Nate Anderson (link above), decisions like this one may challenge the significance of the hotly debated Stop Online Piracy Act (SOPA). After all, the scope of the injunction in this case is incredibly broad.  

The judge is essentially commanding a host of large third parties to engage in a fair bit of work to enforce the court’s order. While the plaintiff was required to post a $20,000 bond, this sum is not slated to cover third party costs but represent a security on the damages that may be awarded the defendant should the court find them successful in arguing a wrongful injunction or restraint. If decisions like this one are to become the norm, one questions the need for strong legislation like SOPA.  

With respect, I tend to disagree in part with this view in so far as SOPA contains a number of other powerful measures such as restraining third party payment providers like PayPal or Moneybookers, and online advertising firms from supporting a given site or sites.  While the above mentioned point is well taken, it seems a little bit early to discount the eventual impact that SOPA and it’s sister the Protect IP Act will have on the legal landscape of the US, and by extentiton, the Internet as a whole.

A few talking points on bill C-11

 This is a version of a piece written for The Mark on some of the more noteworthy elements of bill C-11, The Copyright Modernization Act:

On June 2nd, 2010, the government introduced a new Copyright Modernization Act in the hopes of bringing Canada’s woefully out of date copyright law into the 21st century. Bill C-32, the third attempt in the last five years at achieving this, died on the order paper when parliament wad prorogued this past spring. Now, with a Conservative majority at the helm, the latest incarnation of Canada’s Copyright Modernization Act is speeding through the normal parliamentary process and is currently in its second reading. 

    The new Bill C-11 is more or less identical to Bill C-32. As such, it contains all the same features and pitfalls as the previous bill.  While Canada is desperately in need of a copyright makeover, a number of interest groups and individuals have questioned certain provisions contained in the bill and whether or not they will serve to benefit Canadians as a whole.

Photo by Renjith Krishnan

    The party line on C-11 (like C-32) is that the new amendments will provide Canada with a “balanced” copyright law that will adequately address the interests of all concerned parties while bringing an important element of Canadian law in line with the times.  Below are some of the main talking points of the bill that have stirred up controversy:

New Fair Dealing

In copyright law, there is a doctrine known as fair dealing which prescribes a list of categories where a person may freely make use of copyrighted content without the permission of the rights holder.  In other words, it allows people to carry on activities that, but for the fair dealing doctrine, would be clear cut instances of copyright infringement.

In current Canadian copyright law, research/private study, criticism/review and news reporting are the listed categories fair dealing. Bill C-11 seeks to add fair dealing for the purpose of education, parody and satire to the list.

Both supporters and detractors of the expansion of Canadian fair dealing have criticized the government’s approach.  Some supporters worry that the term “education” is too vague.  Intuitively, one might see this as a positive for supporters of educational fair dealing in that the lack of a strict definition may elicit a wider application.  While this may certainly be true, the reality of the situation is that mounting a fair dealing argument in defence of a copyright infringement law suit can prove to be a costly proposition. A more clearly defined statute may deter certain would be plaintiffs in situations where such clarity would have the effect of lessening their chances of success.

Detractors of educational fair dealing, most notably Access Copyright (the Canadian copyright licensing collective for reproduction of educational materials for all of Canada except Quebec which is under the auspices of Copibec) claim that such a provision will cause irreparable harm to authors whose materials are used in schools.

While parody and satire are not as hotly debated as educational fair dealing, there is one important question concerning these two new rights- namely, what’s the difference between them? The answer- which has proven to be less than obvious- changes depending on who is being asked. It seems that while parody denotes a more literal comical imitation, a satire is often described as more subtle.  Satire also often carries a social or political commentary where parody can be more “superficial”.  The fact remains that the difference between these two words is unclear and that they will most likely have to be defined by the courts.

Finally, proponents of the expansion of fair dealing argue that the list of categories should be non-exhaustive, allowing for new dealings to be considered fair as they arrive. This would mirror the approach in the United States. American “Fair Use” begins the list of categories with the words “such as” (see Title 17 Chapter 1 §107 USC) allowing for innovations in the technological and cultural marketplace to exercise a greater control over what is and is not “fair”.
New consumer exceptions

Believe it or not, it is currently an infringement of copyright law in Canada to rip a CD to your computer and transfer it onto your IPod.  It is also technically an infringement of copyright to use your “PVR” or “TEVO” to record shows for later viewing.  While these are both common practices in Canada, they have been, up until now, violations of copyright law.

Bill C-11 seeks to remedy that situation by allowing both “Format-Shifting” and “Time-Shifting” with the goal of legalizing these already common behaviours. While it is needless to say that cable and satellite providers such as Rogers and Bell have worked out contractual agreements insuring their customers with personal recording devices don’t get sued, it’s nice that the government thought to remove the need for such agreements by simply making these activities an exception to the scope of copyright.

User Generated Content

C-11 contains a novel provision never before seen in a national copyright law.  The Use Generated Content provision, a.k.a the “YouTube” exception, will allow non-commercial creators of “remixes” and “mash-ups” to make use of copyrighted content in the creation of their new derivative works.  This forward looking provision recognizes the paradigm shift in the creation and proliferation of culture described by Harvard Law Professor Lawrence Lessig as the move from “Read only” culture to “Read/Write” culture. 
The YouTube exception is, naturally, riddled with limitations and criteria. That being said, the simple fact that such a provision made it into the bill is a credit to Canada, a country often (rightly) criticized for having inadequate and out of date copyright law.

Anti-circumvention of “Digital Locks”

For all the reasoned and forward looking provisions mentioned above, C-11 contains another provision that has proven to be the chief object of criticism against the Conservative government in adopting the bill.

Clauses 41-41.22 of Bill C-11 which deal with the protection of “Technological Protection Measures” (TPMs) and “Digital Rights Management” (DRM) software disallows anyone from circumventing or otherwise “breaking” these protections. Briefly, a TPM or “digital lock” is essentially a piece of software that limits a user’s right to either access or copy a piece of media like a DVD or videogame. DRM software allows content distributers to manage these controls by monitoring the usage of the protected media and often transmitting this information back to the content distributer or a third party company.

These provisions have been included in the bill to make good on Canada’s treaty obligations pursuant to the WIPO Copyright Treaty (WCT) signed in 1996.  This treaty called for all signatory countries to include in their national copyright laws provisions that assure “adequate protections for digital locks”.  15 years later, C-11 seeks to ratify those treaty obligations.

Most of the criticism against the digital locks provisions is aimed at the fact that it trumps all the above mentioned rights, including fair dealing. While the WCT calls for “adequate” protection, some argue that the provisions contained in C-11 go far beyond the minimum requirements of the broad language used in the treaty.  Indeed many critics of the digital locks provisions, including University of Ottawa law Professor Michael Geist, have pointed out that even the American Digital Millennium Copyright Act (along with the accompanying case law developed since its inception more than a decade ago) is more permissive than C-11 on this point. 

The bill is being sped through Parliament and will likely be enacted exactly as drafted due to the majority government. Furthermore, the government conducted extensive consultation and examination during the committee process on Bill C-32 and is more than aware of all the interested groups’ positions on the subject.  One thing is certain; Canada’s copyright law is changing drastically. The next step will be to see how the courts interpret and apply this new law in the coming years.