providing clarifying support for present trends to create a legal platform for the ...... acts incident to product distribution, such as offering customers technical support ..... copyright holders and that of the freedom to conduct a business enjoyed by .... Warner Cable, and Verizon - the Copyright Alert System provides for notices to ...
Protecting Copyright in the Digital Environment: Suggested Amendments to the 2005 Civil Code of Vietnam to Clarify the Boundary between Protection and Access Doris Estelle Long1 Abstract Perfection of intellectual property laws in the face of new technologies and new communication media is a constant challenge for all countries since the printing press was first created. The upcoming modifications to the 2005 Civil Code of The Socialist Republic of Vietnam provide an invaluable opportunity to engage in a wide-ranging, critical discussion of the civil law methods and techniques that can be adapted to meet the challenges of the digital environment of the 21st Century. By including emerging international civil law techniques to combat digital piracy in the upcoming modifications, Vietnam can continue its efforts to perfect its copyright laws to reflect the benefits and necessities of the global digital environment. With its 2005 Civil Code and other legal instruments relating to copyright protection, including the 2005 Law on Intellectual Property and its membership in such critical international intellectual property organizations as the World Intellectual Property Organization (“WIPO”) and the World Trade Organization (“WTO”), Vietnam has already created a strong legal protection regime for authors and copyright owners. The relatively few provisions governing copyright relations contained in the 2005 Civil Code provide the fundamental tools for creating a copyright protection regime for the “hard goods” world. But they do not expressly address the right of authors to control the distribution of their works in the digital universe or the methods which should be used to effect such control. Subsequent legal instruments demonstrate a growing recognition that the Internet and other digital environments require special protection measures, including granting copyright owners the right to apply technological protection measures and to secure administrative electronic removal of infringing work. Amending the 2005 Civil Code to include a greater focus on digital protection issues would enhance these efforts. The process of amending the 2005 Civil Code would also provide an excellent opportunity to perfect existing laws, allowing the removal of obvious inconsistencies between the Code and the 2005 IP Law (and others) while providing a platform on which to build future protection norms for the growing challenges posed to copyright use and protection in the digital environment. I. Introduction From its early growth as a new medium for digital communication, until today when it has become a global digital marketplace, the Internet has challenged the ability of intellectual 1
Professor of Law, Chair of the Intellectual Property, information Technology and Privacy Group and Director of the Center for Intellectual Property Law, The John Marshall Law School, Chicago, Illinois, United States of America.
property laws to regulate conduct within its digital borders. The WIPO Internet Treaties2 affirm that creators have the right to control the “making available” of their copyrighted works on the Internet.3 Yet providing the legal tools that allow authors and other rights holders to protect effectively that right has proven daunting. If the Internet has allowed new digital markets for copyright-protected works to flourish, it has also provided new opportunities for pirates and other unauthorized users to evade legal and technological controls to protect such works. With its 2005 Civil Code4 and other legal instruments relating to copyright protection, including the Law on Intellectual Property (“2005 IP Law”), enacted in November 29, 2005,5 and with its membership in such critical international intellectual property organizations as the World Intellectual Property Organization (“WIPO”) and the World Trade Organization (“WTO”), The Socialist Republic of Vietnam (“Vietnam”) has already created a strong legal protection regime for authors and copyright owners. As discussed more fully below, the relatively few provisions governing copyright relations contained in the 2005 Civil Code provide the fundamental tools for creating a copyright protection regime for the “hard goods” world. But they do not expressly address the right of authors to control the distribution of their works in the digital universe or the methods which should be used to effect such control. Subsequent legal instruments demonstrate a growing recognition that the Internet and other digital environments require special protection measures, including granting copyright owners the right to apply technological protection measures and to secure administrative electronic removal of infringing work.6 Amending the 2005 Civil Code to include a greater focus on digital protection issues would enhance these efforts. The process of amending the 2005 Civil Code would provide an 2
The term “WIPO Internet Treaties” is generally used to refer to the two multinational treaties signed in 1996 that deal specifically with the rights of authors, performers and other rights holders to control the use of their protected works on the Internet - the WIPO Copyright Treaty (WCT) and the WIPO Performances and Copyright Treaty (WPPT). The recently created Beijing Audio-visual Performances Treaty (AVPT), signed in 2012, also deals specifically with the rights of performers to control their protected performances on the Internet and should qualify as the third member of the “WIPO Internet Treaties” but common usage has not yet made the update. For that reason, in this paper I will continue to use the term “WIPO Internet Treaties” to refer specifically to the WCT and the WPPT. 3 See WCT, Art. 6; WPPT, Art. 8. 4 Civil Code, No. 33/2005/QH11, enacted June 14, 2005 (“2005 Civil Code). 5 Law on Intellectual Property, No. 50/2005/QH11, enacted November 29, 2005 (“2005 IP Law”). Other legal instruments relating specifically to copyright and related rights protection include Declaration No. 47/2009/ND-CP of May 13, 2009 On the Sanctioning of Administrative Violations of Copyright and Related Rights (“Administrative Sanctions Decree”); Decree No. 100/2006/ND-CP of September 21, 2006, Detailing and Guiding the Implementation of a Number of Articles of the Civil Code and the Intellectual Property Law Regarding Copyright and Related Rights (“September 2006 Decree”); Decree No. 105/2006/ND-CP of September 22, 2006, Detailing and Guiding the Implementation of a Number of Articles of the Law on Intellectual Property on Protection of Intellectual Property Rights and on State Management of Intellectual Property (“State Management Decree”); Decree No. 56/2006/ND-CP of June 6, 2006, On Sanctioning Administrative Violations in Cultural and Information Activities (“Cultural Administrative Sanctions Decree”) and Joint Circular, Guiding the Application of a Number of Legal Provisions to the Settlement of Disputes over Intellectual Property Rights at People’s Courts, April 3, 2008 (“Joint Circular”). 6 See, e.g., 2005 IP Law Art. 198 (“2005 IP Law”) (permitting copyright holders to use technological measures to protect their works from unauthorized use).
excellent opportunity to perfect existing laws, allowing the removal of obvious inconsistencies between the Code and the 2005 IP Law (and others) while providing a platform on which to build future protection norms for the growing challenges posed to copyright use and protection in the digital environment. Because of the unique nature of “digital piracy,” and its often non-commercial nature, at least from the point of view of end users who post, download, stream and file trade in copyrighted works, civil law remedies have become the primary focus of international efforts to curb its proliferation. This paper examines three different civil law techniques that have emerged to deal with the problem of digital piracy that could form the basis for amendments to the 2005 Civil Code. These techniques raise critical issues regarding the balance to be struck between content control (through stronger protection measures) and greater access by the public to the information contained within such works to permit the creation and dissemination of new works. But each technique also permits domestic experimentation to achieve the appropriate boundaries between protection and access so that Vietnam can construct a civil law regime that meets its own unique economic, cultural and political goals.7 Broadly speaking, these three civil law techniques include (1) civil law protections for the technology used to protect and filter content; (2) procedures for removing unauthorized content from the Internet and preventing its reappearance; including issues related to Internet service provider liability and (3) the removal of access boundaries that may contribute to the growth of Internet piracy, including the adoption of international rights exhaustion. By discussing these options at this critical stage in the amendment process, choices can be made that will help Vietnam in its continuing efforts to achieve a copyright regime that serves its development goals. This paper is not designed either to be a detailed review of present intellectual property laws in Vietnam or to suggest detailed provisions that could be included in any future amendment of the copyright provisions in the 2005 Civil Code. Vietnamese legal scholars and professionals have a far greater knowledge of their laws and its potential gaps and inconsistencies than I do. Instead, it is designed to suggest issues for consideration in the process of perfecting present laws. To achieve this goal, this paper begins with a brief review of the present international challenges facing copyright owners in enforcing their rights in the digital environment and the relevant international treaties the govern these rights, many of which Vietnam is already a signatory. It then discusses in extremely abbreviated terms the relevant provisions of the 2005 Civil Code that govern the civil law protection of copyright in the digital environment. It briefly suggests potential areas for further consideration with a goal toward either resolving present inconsistencies between the Code and subsequently enacted laws governing copyright, or providing clarifying support for present trends to create a legal platform for the growth of the digital market in Vietnam. It is within this context that suggestions are made for consideration of three international techniques currently being used in other countries to deal with the challenge of digital piracy. Vietnam’s laws already contain the foundations for adopting any or all of these techniques. The process of modifying the 2005 Civil Code merely provides an opportunity to consider the desirability of doing so.
7
See 2005 IP Law Art. 8(2)(providing that among the State’s policies is “[t]o encourage and promote activities of creation and utilization of intellectual assets in order to contribute tot eh socio-economic development and the improvement of the People’s material and spiritual life”).
Any review of Vietnamese intellectual property law by this author is necessarily limited by both the author’s need to rely on English translations of local laws (and the inaccuracies such translations may contain) as well as her lack of knowledge of the intricacies of Vietnamese intellectual property law. It is provided only as an introduction to the topic, with the full understanding that only legal professionals in Vietnam have the necessary background to perform a complete analysis of the issues raised. I have further tried to reduce potential misunderstandings by relying solely on the English translations of laws filed by Vietnam with WIPO and obtainable from the WIPOLEX database, available at http://www.wipo.int/wipolex/en. II. Copyright Protection and Digital “Piracy”: Securing the Benefits of the Internet for Future Authors. A. The Scope of the Problem With an estimated 2.7 billion users globally (40% of the World’s population according to the International Telecommunications Union),8 the Internet poses an enormous opportunity for small and medium enterprises to become full, active members in the burgeoning global, digital marketplace. Small businesses can use the Internet to sell goods and services to others in their own country and abroad. The Internet and related digital environments can also be used in the delivery of educational services, as a new form of telecommunications, and as a vibrant selfpublishing medium, allowing new authors, artists and other creators to share their works without facing the often high content distribution costs of the “hard goods” world. Yet, if the Internet has fostered the development of new digital markets and new communication media that allow copyright-protected works to flourish, it has also provided new opportunities for “digital pirates” to evade legal controls to protect those works. Illegal streaming video, unauthorized peer-to-peer trading in copyrighted files and a growing demand for access to the content of copyrighted works, such as software, films, music and books, without compensation to the copyright owner present international challenges that all countries struggle to overcome. Perhaps one of the most significant contributing factors to the present scourge of digital piracy is the simple ease of reproduction offered by modern technologies. Not only can digital copies be created at everdiminishing costs, these copies, unlike the analog copies of old, are virtually indistinguishable from the original in quality. The creation of such copies generally does not diminish the quality of the original. Worse, technology has made it so easy those who lack technological capabilities can engage in such activities. Digital piracy has become for many merely one click of a button. I use the term “digital piracy” advisedly in this paper since I am not convinced that it fully describes the nature of the challenge facing copyright owners in connection with the unauthorized distribution of their copyrighted works in a digital environment. The term “piracy” itself was first created to describe the illegal printing and public distribution of printed books in the 17th Century.9 The term now includes the unauthorized reproduction and distribution of hard 8
The World in 2013, ICT Facts and Figures (International Telecommunications Union 2013) Available at http://www.itu.int/en/ITU-Statistics/Documents/facts/ICTFactsFigures2013.pdf. 9 See, e.g., Adrian Johns, Piracy: The Intellectual Property Wars from Gutenberg to Gates, pg. 23 (University of Chicago Press 2009); The Oxford English Dictionary has 1603 as the earliest use in this manner, while the Online Etymology Dictionary dates the first recorded use to 1701. Justin Hughes, Copyright and Incomplete Historiographies: Of Piracy, Propertization, and Thomas Jefferson, 79 S. Cal.
copy versions of copyrighted works, including books, videos, films, music and the like.10 Most often “piracy” was undertaken in the “hard goods” world by criminal elements who used the monies earned from such sales to finance other illegal activities.11 The commercial aspect of such activities, combined with its criminal nature, led to an emphasis on criminal laws as the best method for combatting such illegal distribution in the latter decades of the 20th Century internationally.12 With the development of the World Wide Web, the nature of the persons engaged in the unlawful “distribution”13 of copyrighted works has changed. There are still entities that use the sale of pirated works to fund criminal enterprises on the Internet.14 Nevertheless, many of those who actually assist in the unauthorized creation and/or distribution of copyrighted works on the Internet are end users. They do not generally distribute such works for commercial gain, although the websites that host such activities may well earn money from their activities. This “non-commercial” and social nature of end user infringement makes digital piracy potentially different in both scope and nature than “hard copy” piracy. Because of this distinction some
L. Rev. 993 (2006)(noting that the term piracy was originally applied to illegal printing of books and manuscripts in the 17th Century). 10 See, e.g., Goldstein v. California, 412 U.S. 546, 549 (1973)(“Petitioners were engaged in what has commonly been called "record piracy" or "tape piracy"—the unauthorized duplication of recordings of performances by major musical artist.”). 11 See Doris Estelle Long, Strategies for Securing the Cyber Safety Net Against Terrorists: A MultiDisciplinary Approach in Terrorism and Global Insecurity: A Multidisciplinary Perspective (Linton Atlantic Books, Ltd. 2009). 12 See 18 U.S.C. §2319(providing criminal penalties for the unauthorized reproduction and distribution, “including by electronic means, during any 180-day period, of ...1 or more copyrighted works, which have a total retail value of more than $2,500”). See also Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), Article 61 (requiring member countries to provide criminal penalties for “copyright piracy on a commercial scale”). 13 As described more fully below, the precise rights implicated by the dissemination of copyrighted works over the Internet remains contentious. Among the rights which countries treat as implicated are the rights of reproduction, public distribution, public performance and/or communication to the public of the work. The failure to agree on the nature of this dissemination nearly led to a failure of the Diplomatic Conference for the WCT and the WPPT. To resolve this problem, both treaties adopted the term “making available” to describe the general right of allowing access to a copyrighted work on the Internet . See Michaly Ficsor, The Law of Copyright and the Internet : The 1996 WIPO Treaties, Their Interpretation and Implementation (2002). The term “making available,” however, presents its own problems. For example, under U.S. domestic law, courts have disagreed as to whether the mere “making available” of a copyrighted work, without the distribution of any actual copy qualifies as a copyright violation. Compare Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir. 1997) (holding that making copyrighted material available is sufficient to constitute an unauthorized “distribution” under US copyright law) with Nat'l Car Rental Sys., Inc. v. Computer Assocs. Int'l, Inc., 991 F.2d 426, 434 (8th Cir. 1993) (stating that infringement of the distribution right requires the actual dissemination of copies). Consequently, I am using the term “distribution” to refer to any publication or other dissemination of a copyrighted work, regardless of the medium employed since this seems the most appropriate compromise term. 14 Hearing before the Committee on International Relations, U.S. House of Representatives, Intellectual Property Crimes: Are Proceeds from Counterfeit Goods Funding Terrorism (July 16, 2003).
scholars contend that the term “piracy” is inapplicable to the digital world.15 The term “digital piracy,” however, at least conveys the significant difference between “copyright infringement” and the unauthorized reproduction and distribution of entire works – “copyright piracy.” Consequently, for the sake of convenience, I will use the term “digital piracy” generally to refer to the phenomenon in the digital environment of the unauthorized reproduction and/or “distribution” of copyright protected works on the Internet and in other digital media, including smartphones. As a result of the unique nature of digital piracy, and its often non-commercial nature, at least from the point of view of end users who post, download, stream and trade in copyrighted works, many countries are reluctant to impose criminal penalties for such activities. Article 23 of the recently negotiated Anti-Counterfeiting Trade Agreement (ACTA)16 required that “criminal procedures and penalties” be applied “at least in cases of ... copyright or related rights piracy on a commercial scale.”17 It further defined “acts on a commercial scale” to include “at least those carried out as commercial activities for direct or indirect economic or commercial advantage.”18 Article 27 of ACTA expressly required that criminal enforcement procedures be available for applicable infringing activities that “take[] place in the digital environment,”19 thus imposing an obligation of criminal penalties for at least digital piracy on a commercial scale. Although ACTA was signed by eight countries, in October 2011, including the United States, Japan, South Korea and the European Union,20 it ultimately failed to achieve timely ratification. The criminalization of digital piracy contained in ACTA was cited by many critics as one of the key reasons for it rejection.21 In place of criminal penalties, civil law remedies have become the primary focus of international efforts to curb digital piracy. These remedies, discussed in greater detail below, range from legal protection for technological protection and filtering measures, to notice, takedown and safe harbor measures for Internet service providers, to contractual measures to protect Internet content. Each of these measures establishes boundaries between protection of copyrighted content and information access that vary depending on the development goals of a country. Each also provide a potential source for future norms that could be used to continue to enhance the treatment of digital copyright issues under Vietnam’s current laws. B. International Protection Standards for Copyrighted Content on the Internet As a signatory to the Berne Convention for the Protection of Literary and Artistic Works (“Berne Convention”),22 the Rome Convention for the Protection of Performers, Producers of
15
William Patry, Moral Panics and Copyright Wars (Oxford University Press 2009). Anti-Counterfeiting Trade Agreement (ACTA), available at http://www.mofa.go.jp/policy/economy/i_property/pdfs/acta1105_en.pdf 17 ACTA, Art. 23(1). 18 ACTA, Art. 23(1). 19 ACTA, Art. 27(1). 20 The eight signatories were Australia, Canada, the European Union, Japan, Republic of (South) Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland, and the United States. 21 See Olivia Solon, What is ACTA and why should you be worried about it?, WIRED (January 24, 2012), available at http://www.wired.co.uk/news/archive/2012-01/24/acta-101. 22 Berne Convention for the Protection of Literary and Artistic Works, available at www.wipo.int/ (“Berne”). 16
Phonograms and Broadcasting Organizations,23 the Brussels Convention Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite24 and the Agreement on Trade Related Aspects of Intellectual Property Rights (“TRIPS”),25 Vietnam has already acceded to most of the major multilateral treaties governing the protection of copyrighted content on the Internet. It is has not yet acceded to the WIPO Internet Treaties or the AVPT. Its current laws, however, demonstrate a steady movement in the direction of incorporating many of their substantive standards concerning Internet protection modalities.26 The process for modifying the 2005 Civil Code would provide an excellent opportunity for perfecting Vietnam’s intellectual property regime by incorporating many of the remaining standards contained in these treaties. This section contains a brief overview of the present international standards for the protection of copyrighted content on the Internet, with a particular focus on those international standards directed to the protection of copyrighted works. Because the protection of copyrighted works in the digital environment of the Internet is often perceived to involve issues of public performance and public communication, I have also included a brief discussion of related rights protection with regard to the availability of performances on the Internet. Although the printing of sheet music and the public performance of the song contained on that sheet music implicated distinctly different rights in the hard goods world of the 20th Century,27 those differences are rapidly disappearing in the digital environment.28 23
Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, available at http://www.wipo.int/treaties/en/ip/rome/. 24 Brussels Convention Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite, available at http://www.wipo.int/treaties/en/ip/brussels/. 25 Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), available at http://www.wto.org/english/docs_e/legal_e/legal_e.htm#TRIPs. 26 See, e.g., 2005 IP Law, Art. 198 (“2005 IP Law”) (permitting copyright holders to use technological measures to protect their works from unauthorized use) & Art. 28(12)(defining the deactivation of technical solution applied by copyright holders as an act of infringement). 27 Under earlier hard goods regimes, the printing of the sheet music would have implicated the reproduction and public distribution rights. Such rights are generally subject to a significant exception in the first sale or exhaustion doctrine which eliminates a copyright holder’s ability to control subsequent distribution of the sheet music upon the lawful acquisition by another of a legitimately produced copy. See, e.g., 17 U.S.C. §109(a)(providing that, without the copyright owner’s permission, the owner of “a particular copy” that is lawfully made and acquired can “sell or otherwise dispose of the possession of that copy”). By contrast the public performance of that music would have implicated the rights of public performance, broadcasting and/or communication to the public. Such rights were relatively circumscribed under domestic law. Thus, for example, in the United States, the public performance of the song would have required compensation to the composer, as a public performance of his copyrighted music. It would not, however, require compensation to the performer who had no right of public performance under US copyright law. See 17 U.S.C. §106(4)(limiting rights of performance to “works”) Thus, a performer’s only form of compensation in the pre-digital era would have been whatever monies earned under a contract of employment to perform the song. Since 1995, however, if the performance were fixed in a sound recording and then transmitted over the Internet, the performer would be entitled to compensation for the public performance of the sound recording “by means of a digital audio transmission.” 17 U.S.C. §106(6). Exhaustion is discussed in greater detail in Section IV.C below. 28 For example, as described in greater detail below, the WCT, the WPPT and the AVPT contain similar provisions regarding the “making available” of protected works and performances. Compare WCT, Art. 8; WPPT, Art.10; and AVPT, Art. 10.
The Berne Convention, first established in 1886, sets the minimum substantive standards for copyright protection internationally. It currently requires copyright protection for enumerated categories of “literary and artistic works [including] every production in the literary, scientific and artistic domain whatever may be the mode or form of its protection.”29 It also requires that authors be granted the exclusive right to control the reproduction of their works,30 their translation,31 and their public distribution, performance and display.32 Since it was last modified in 1971, the Berne Convention does contain any specific provisions that detail the protection of copyrighted content in the digital environment. Nevertheless, its provisions form the foundation of the copyright protection required under what has become the pre-eminent multilateral intellectual property treaty of the 20th Century –TRIPS. The result of nearly seven years of multinational negotiations, TRIPS established the fundamental international harmonization norms for international protection of a wide variety of intellectual property forms, including copyright.33 Because TRIPS incorporates all of the substantive standards of the Berne Convention,34 with the exception of moral rights protection under Article 6bis,35 TRIPS affirmed the pre-eminence of the Berne Convention in connection with international copyright norms. It also went beyond the Berne Convention by establishing minimum standards for the enforcement of intellectual property rights.36 Significantly, Article 41 of TRIPS required the “effective” enforcement of intellectual property rights and contained detailed requirements for civil, border and criminal procedures to assure such effective enforcement.37 Perhaps most importantly, treaty obligations, including the obligation of “effective” enforcement were enforceable under the dispute settlement mechanisms of the WTO.38 Although TRIPS was signed in 1994, at approximately the same time that the World Wide Web was emerging as more than a glorified electronic chat room, it did not contain any particularized provisions to address the special concerns raised regarding the “distribution” of copyrighted content in the digital environment of the Internet. Within two years of the conclusion of TRIPS, however, a diplomatic conference held under the auspices of WIPO lead 29
Berne, Art. 2. Berne, Art. 9. 31 Berne, Art. 8. Article 12 of the Berne Convention also grants authors the exclusive right of "authorizing adaptations, arrangements and other alternations of their works." Berne, Art.12. 32 Berne, Arts. 11 bis, and 11 ter. The distribution right was not expressly referenced in the Berne Convention but was considered to form part of the reproduction right granted under Article 9 since such rights would have little value without a right to control the distribution of unauthorized works. The distribution right was expressly referenced in the subsequent Internet treaties. See discussion below at notes 39 - 40. 33 See generally Doris Estelle Long, “Globalization”: A Future Trend or a Satisfying Mirage?, 49 J. Copyright Society 313 (2001). 34 TRIPS, Art. 9(1). 35 Article 6bis requires the protection of the moral rights of patrimony and integrity. Berne, Art. 6bis. 36 See generally TRIPS, Arts. 41 – 61 (detailing required minimum standards for civil, border and criminal enforcement of intellectual property rights, including copyright). 37 TRIPS, Art. 41. 38 TRIPS, Art. 64 30
to the signing of the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (“WPPT”), generally referred to as the “WIPO Internet Treaties.” On their face, both of these treaties can be considered TRIPS add-on agreements. They were negotiated by many of the same parties that had concluded the TRIPS negotiations. Similar to TRIPS, the WCT and WPPT both included requirements of “effective” enforcement of their affirmative obligations.39 They also, however, filled some of the critical gaps that had not been addressed by TRIPS, including, significantly, special provisions required to protect more effectively copyright on the Internet. Specifically, the WCT and the WPPT affirmatively established that authors and performers had the right to control the “distribution” of their works in all environments. Article 6(1) of the WCT expressly provided: “Authors of literary and artistic works shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of their works through sale or other transfer of ownership.”40 This right was duplicated in Article 8 of the WPPT with regard to the making available of fixed performances.41 The right to control the “distribution” of protected works and performances was further emphasized in both treaties by the express grant of an exclusive right to authorize “any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access these works from a place and at a time individually chosen by them.”42 This “making available” right was a compromise term, established to settle an on-going dispute among diverse countries over whether the “distribution” of works over the Internet involved the right of reproduction, public distribution, public performance or public communication.43 It allowed countries to define Internet access in terms that met their own particular view of the rights implicated through Internet publication and distribution, while maintaining the international standard of author control over such access. The WIPO Internet Treaties also established new methods for protecting copyright and related rights content in the digital environment. Both the WCT and the WPPT, in virtually identical provisions, required signatory countries to provide legal protection for the “effective technological measures” that authors employ to protect their rights.44 Such legal protection includes “effective legal remedies” against both the unauthorized circumvention of those technologies45 and the unauthorized removal or alteration of electronic rights management information contained in digital versions of copyrighted works.46 Despite clearly establishing the need to provide effective protection for copyrighted works on the Internet, neither the WCT, 39
WCT, Art. 14; WPPT, Art. 23. WCT, Art. 6(1)(emphasis added). 41 WPPT, Art. 8. 42 WCT, Art. 8 (emphasis added). The WPPT contained a similar right with regard to fixed performances: “Performers shall enjoy the exclusive right of authorizing the making available to the public of their performances fixed in phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.” WPPT, Art. 10 (emphasis added). 43 Michaly Ficsor, The Law of Copyright and the Internet : The 1996 WIPO Treaties, Their Interpretation and Implementation (2002). 44 WCT, Art. 11; WPPT, Art. 18. 45 Ibid. 46 WCT, Art. 12, WPPT, Art. 19. 40
nor its related rights equivalent, the WPPT, set forth clearly defined methods for achieving these goals. The recent creation of the Beijing Treaty on Audio-Visual Performances (AVPT) in 2012,47 provided for the identical “making available” rights for audio-visual performances on the Internet as those contained in the WCT and the WPPT.48 It also contained the same obligations with regard to providing “effective legal remedies” for the unauthorized circumvention of “effective technological protection measures.”49 Despite the 16 years of experience under the WCT and the WPPT, however, the AVPT does not contain any additional standards for achieving the required “effective legal protection” for audio-visual works on the Internet. This lack of guidance does not relieve parties from assuring effective protection for copyrighted works on the Internet, but it does allow each country to choose the best method for its own needs and policies to secure such rights. As a result, diverse civil law methods have arisen to deal with digital piracy. They are discussed in greater detail in Section IV below. III. Present Copyright Protection Under the 2005 Civil Code: An Evolving Standard Based on the documents filed with WIPO, Part Six of the 2005 Civil Code, specifically Articles 736 to 749, expressly address the protection of copyrighted works while civil enforcement issues are covered generally in Articles 773 to 777. These provisions are expressly supplemented by the “Law on Intellectual Property,” No. 50/2005/QH11 (“2005 IP Law”). Certain provisions of the 2005 Civil Code, such as Article 739 concerning the term limits for copyright, make specific reference to this law.50 Others, such as Article 738, defining the property rights granted under copyright, do not. 51 Legal standards for the protection of copyrighted works has been further supplemented by a wide variety of Guidelines, Declarations and Decrees, including significantly, Declaration No. 47/2009/ND-CP of May 13, 2009 On the Sanctioning of Administrative Violations of Copyright and Related Rights (“Administrative Sanctions Decree”); Decree No. 100/2006/ND-CP of September 21, 2006, Detailing and Guiding the Implementation of a Number of Articles of the Civil Code and the Intellectual Property Law Regarding Copyright and Related Rights (“September 2006 Decree”); Decree No. 105/2006/ND-CP of September 22, 2006, Detailing and Guiding the Implementation of a Number of Articles of the Law on Intellectual Property on Protection of Intellectual Property Rights and on State Management of Intellectual Property (“State Management Decree”); Decree No. 56/2006/ND-CP of June 6, 2006, On Sanctioning Administrative Violations in Cultural and Information Activities (“Cultural Administrative Sanctions Decree”) and Joint Circular, Guiding the Application of a Number of Legal Provisions to the Settlement of Disputes over Intellectual Property Rights at People’s Courts, April 3, 2008 (“Joint Circular”). These are all post-2005 Code instruments. These laws apply retroactively and govern present-day disputes over earlier protected works.52 For this reason, I have focused my analysis of existing copyright protection 47
The Beijing Treaty on Audio-Visual Performances (AVPT) will not become effective until three months after it is ratified by 30 countries. AVPT, Art. 26. According to WIPO, only one country, the Syrian Arab Republic, has ratified the treaty to date. 48 AVPT, Art. 10. 49 AVPT, Art. 15. 50 2005 Civil Code, Art. 739(3) (“Property rights in copyright shall exist with the time limit specified by the law of intellectual property.”). 51 2005 Civil Code, Art. 738. 52 Joint Circular, Section V (1).
under Vietnam’s domestic laws to those enacted contemporaneously with, or post, the enactment of 2005 Civil Code. Although the 2005 Civil Code does not prescribe an order of precedence in the event of a conflict between its provisions, and those of the 2005 IP Law (or any other intellectual property related legal instrument), Article 5 of the 2005 IP Law does establish such an order. The order of precedence it sets out in the event of conflict is: first, treaty provisions; second, the 2005 IP Law; and third, the 2005 Code.53 This order is affirmed in the Joint Circular, Section IV(1.1.).54 Such order of precedence is critical because even with regard to so fundamental a question as the scope of rights granted a copyright holder the 2005 Civil Code and the 2005 IP Law potentially conflict.55 No mention, however, is made as to the impact of conflicts between the 2005 Civil Code or the 2005 IP Law and any subsequently established Decree or Declaration. Thus, to the extent that an administrative order of forced removal of unauthorized electronic copies in accordance with Article 18(6)(b) of the Administrative Sanctions Decree is perceived to conflict with Article 208 (civil law remedies) or Article 214 (administrative sanctions) of the 2005 IP Law concerning available remedies for such infringement, which does not specifically reference such electronic removal, it would appear that the 2005 IP Law would take precedence. This would be an unfortunate outcome since electronic removal of pirated works is arguably a critical step in the protection of copyrighted works on the Internet. A detailed examination of the various provisions contained in these diverse copyright instruments is beyond the scope of this paper. However, even a cursory examination demonstrates an increasing focus on perfecting Vietnam’s intellectual property laws. The chronological development of these various instruments shows an increasing focus on clarifying protection norms to assure adequate support for both copyright owners and for public information access. For example, while Article 438 of the 2005 Civil Code outlines specific property rights that inhere in copyright, including the right to “duplicate the work; ... to distribute ... the originals and copies of the works” and to “disseminate the works to the public,”56 the 2005 IP Law, by contrast, in Article 25, specifically provides for a variety of uses of copyrighted works that may be made without the permission of, or compensation to, the copyright holder.57 These uses arguably reflect a balance between protection and access generally allowed under international standards and include the duplication of works “for scientific research or teaching purposes,”58 the “reprographic reproduction” of works by libraries “for archival and research purposes”59 and the “transcription into Braille or characters of other languages for the blind.”60 The diversity of legal instruments relating to copyright protection enacted subsequent to the 2005 Civil Code also demonstrate a growing recognition that the Internet and other digital environments require special protection measures. Thus, for example, although there is no 53
Law on Intellectual Property (2005 IP Law), Art. 5. Joint Circular, Section IV (1.1) 55 Ibid. (describing the conflict between Article 20(3) of the 2005 IP Law and Article 738 of the 2005 Civil Code and affirming that “Article 20 of the Intellectual Property Law should be applied to the settlement of disputes over these rights.”). 56 2005 Civil Code, Art. 738(3). 57 2005 IP Law, Art. 25(1)(a). 58 2005 IP Law, Art. 25(1)(a). 59 2005 IP Law, Art. 25(1)(e). 60 2005 IP Law, Art., 25(1)(i) 54
mention in the 2005 Civil Code regarding the protection of copyright on the Internet, as noted above, various articles in the Administrative Sanctions Decree specifically provide for remedies for various acts of copyright infringement that include as a potential remedy “forced removal of electronic copies of works from the Internet, electro-informatic devices and other equipment.”61 Similarly, Article 198 of the 2005 IP Law expressly grants right holders the right to “apply technological measures to prevent acts of infringement.” while Article 28 specifically provides that the unauthorized deactivation of such measures qualifies as an act of infringement.62 This trend to perfect copyright laws to reflect the need for new protection methodologies in the digital environment should be encouraged in the amendment process for the 2005 Civil Code. The few provisions of the 2005 Civil Code that deal with the protection and enforcement of intellectual property rights currently do not appear to address fully the mechanisms required to protect copyrighted content on the Internet. The relatively few provisions governing copyright relations contained in the Code provide the fundamental tools for creating a copyright protection regime for the “hard goods” world. They define authorship and copyright ownership;63 identify the features required to qualify as a copyright protectable works;64 provide a brief description of the personal and property rights included in copyright, including the right to “distribute...originals and copies of the works” and to “disseminate the works to the public;”65 set the term of copyright;66 and the legal obligations for effective copyright transfers, including by contract.67 But they do not expressly address the right of authors to control the distribution of their works in the digital universe. The term “dissemination” which is identified as a property right inhering in copyright in Article 738 of the Code, is not specifically defined in the Code or in the subsequently enacted 2005 IP Law to provide a sufficient assurance of its application to digital content on the Internet. More problematically, the 2005 Civil Code mentions neither “public performance” nor “communication to the public” as rights granted copyright owners, although these rights are mentioned in subsequent legal instruments.68 This lack of a complete list of rights in the 2005 Civil Code is exacerbated by the diverse and potentially conflicting rights definitions contained in subsequent legal instruments. For example, Article 738 of the 2005 Civil Code grants authors an undefined right of “dissemination” which might include the streaming and downloading activities that are the hallmark of digital piracy.69 By contrast, Article 20 of the 2005 IP Law does not include “dissemination” among the granted rights.70 (It is not clear whether such lack would qualify as a conflict under the Joint Circular precedence standards in Section IV.1.1.71) Article 20 does, however, include the right of authors to 61
See, e.g., Administrative Sanctions Decree, Art. 18(6)(b). Among the rights for which the electronic removal penalty may be imposed for their infringement are: the right to “publicize” the works (Art. 16(4)(b); the right to perform the work (Art. 18(6)(b)); the right to distribute copies of the work (Art. 20(13)(b)); and the to communicate the work to the public (Art. 22(4)(b)). 62 2005 IP Law, Arts. 198 (1)(a), 28(12). See also Administrative Sanction Decree, Art. 43. 63 2005 Civil Code, Arts. 736, 740 and 741. 64 2005 Civil Code, Art. 737. 65 2005 Civil Code, Art. 738 66 2005 Civil Code, Art. 739. 67 2005 Civil Code, Arts. 742 – 743. 68 See 2005 IP Law, Art. 20(e). 69 2005 Civil Code, Art. 738. 70 2005 IP Law, Art. 20. 71 See note 53 above.
“communicate their works to the public by wire or wireless means, electronic information networks or any other technical means.” 72 This definition is further expanded by the September 2006 Decree that expressly defines the right of communication to the public right as a right to “make their works or copies thereof available to the public in such a way that members of the public may access such works from a place and at a time the themselves select.”73 This definition appears to clarify that the audience for the communication does not have to be located in a public place or otherwise qualify as a public grouping for the communication to be considered a “public” one. Instead, any transmission over the Internet which can be accessed by the public appears to qualify as a right granted to the copyright owner. Under this definition, the copyright owner is given a strong right to control the use of his copyrighted content on the Internet, subject to applicable fair use doctrines. This avoids debates, such as those occurring in the United States, over the nature of the audience required for streaming video to qualify as public and, therefore, subject to control.74 However, unless this amendment is carried forward into the amended Code, it is not clear that it will be applied under the precedence standard of the Joint Circular. Although resolving potential conflicts among the various copyright instruments is a key task, this paper will focus on another equally important one – using the modification of the 2005 Civil Code as an opportunity to perfect civil methods for securing copyrighted content on the Internet. For example, granting copyright owners the right to employ technological measures to protect their works75 is a critical step in creating a viable protection regime for digital works. However, the efficacy of those measures may be reduced without clarification of the types of technological measures to be protected– access or rights restrictive – or of the right of the public to circumvent such measures for fair use purposes. Similarly, the removal of infringing works from the Internet 76 is a valuable remedy to combat digital piracy. But without detailing the methods available to secure such removal – filtering, notice and takedown provisions – and the obligations of an Internet Service provider in connection with such efforts, the ability to effect such relief could be compromised. Perhaps even more significantly, a review of potential options for securing such removal could lead to valuable decisions regarding the boundaries to be drawn between copyright protection and information access. That discussion has already begun in connection with some of the fair use/fair dealing provisions of Article 25 of the 2005 IP Law discussed above.77 It could be deepened by expanding the discussion to include other protection/access balance points. By discussing these options at this critical stage in the amendment process, choices can be made that will help Vietnam in its continuing efforts to achieve a copyright regime that serves its policy development goals. One of the best methods for beginning that critical discussion may be by focusing on the three different civil law techniques that have emerged to deal with the problem of digital “piracy.” Each of these techniques addresses an issue 72
2005 IP Law, Art. 20(e). September 2006 Decree, Art. 23(4). 74 Compare The Cartoon Network LP v. CSC Holdings, Inc., 536 F.3d 121(2d Cir. 2008)(audience must be public one) with Fox Television, Inc. v. Barry Diller Content Systems, PLC, Case No. CV 126921-GW(JCx) (C.D.Cal. 2012)(transmission where accessible at different times by members of the public is sufficient). 75 See 2005 IP Law, Art. 198. 76 See, e.g., Administrative Sanctions Decree, Art. 18(6)(b). 77 See notes 57 – 59 above and accompanying text. 73
that is already raised in Vietnam’s present laws. Each raises critical issues regarding the balance to be struck between content control and information access to permit the creation and dissemination of new works. Perhaps most significantly, each technique permits domestic experimentation to achieve the appropriate boundaries between protection and access so that Vietnam can construct a civil law regime that meets its own unique economic, cultural and political goals. IV. International Civil Law Solutions Although the WIPO Internet Treaties and the AVPT specifically required “effective enforcement” of copyrighted works and performances on the Internet,78 none of them contained detailed guidance on how to achieve such enforcement, particularly in the face of growing digital piracy. Nevertheless, countries have developed three civil law techniques for achieving such enforcement. As noted above, these three techniques include (1) civil law protections for technology used to protect and filter content; (2) procedures for removing unauthorized content from the Internet and preventing its reappearance; including issues related to Internet service provider liability and (3) the removal of access boundaries that may contribute to the growth of Internet piracy, including the adoption of international rights exhaustion. To be effective each of these techniques requires a careful balancing of access and protection rights. Countries differ on where the lines should be struck or how effective these techniques may be. But different countries’ experiences may provide a useful place to begin in crafting perfected enforcement regimes for the digital universe. A. Is Technology the Answer? Vietnam has already recognized that technological measures imposed by copyright owners are a valuable tool in enhancing protection efforts for digital works.79 It would be useful to clarify the precise nature of the technologies for which anti-circumvention protection is available to avoid future disputes. Countries have struck different balances with regard to the nature of technological measures protected under anti-circumvention provisions. The United States, example, protects both access and rights restrictive technologies. The Digital Millennium Copyright Act (DMCA), enacted in 1998, prohibits the circumvention of two types of “effective technological protection measures.” The first “prevents, restricts, or otherwise limits the exercise of a right of a copyright owner,” often referred to as “rights restrictive” technologies.80 Rights restrictive technologies are subject to a limited fair use exception. So long as the purpose for which the technological measure is being circumvented qualifies as a fair use81 and the person circumventing that measure is capable of doing so without seeking outside assistance (including obtaining codes from the internet), an individual may circumvent protected measures.82 The second type of technological protection measure subject to anti-circumvention prohibitions under the DMCA “effectively controls
78
79 80
See WCT, Art. 14; WPPT, Art. 23.
DMCA, §1201(b)(2)(B)(emphasis added). See 17 U.S.C. §107. 82 17 U.S.C. §1201(b)(2)(C). 81
access” to the work.83 While rights restrictive technologies may be lawfully circumvented for a fair use purpose, no such fair use right exists for access control technologies.84 By contrast, the European Union only requires members to protect technological measures that “in the normal course of its operation, is designed to prevent or restrict acts, in respect of works ... which are not authorized by the right holder of any copyright...”85 Although such language allows individual countries to protect access control technologies, it arguably does not require such protection. The European Union also provides a far more expansive scope of limitations and exceptions exempted from anti-circumvention prohibitions. Article 6(4) of the Directive on Copyright in an Information Society allows Member States to “take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law .... the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned.”86 The scope of potential fair uses that might be covered under an Article 6 exception are potentially broadened by Article 5 of the Directive. One of the most comprehensive lists of fair use activity in connection with copyright exceptions, Article 5(3) contains a detailed list of potential fair uses that can be granted for the rights of reproduction, communication and making available. They include: 1) For teaching or scientific research: 2) For the benefit of people with a disability; 3) For news reporting purposes; 4) Quotations for criticism or review; 5) For the purposes of public security or “to ensure proper performance of reporting of administrative, parliamentary or judicial proceedings;” 6) For Informatory purposes if the work is a political speech or public lecture; 7) For use during religious celebrations or official celebrations organized by a public authority; 8) Use of works of architecture or sculpture located permanently in public places; 9) For advertising artistic works for sale; 10) For caricature, parody or pastiche; 11) In connection with demonstration or repair of equipment; 12) For reconstructing a building; 13) For research or private study on dedicated terminals.
83
17 U.S.C. §1201(a)(1)(A) Universal City Studios v. Reimerdes, 82 F. Supp. 2d 2111 (S.D.N.Y. 2000)) aff’d sub nom. Corley v. Universal City Studios, 273 F.3d 429 (2d. Cir. 2001). 85 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, Art 6(3)(EUCD). 86 EUCD, Art. 6(4). 84
All of these exceptions are subject to the tri-partite test that they only be applied “[1] in certain special cases [2] which do not conflict with a normal exploitation of the work or other subject matter and [3] do not unreasonably prejudice the legitimate interests of the right holder.”87 In addition to serving as a type of self-help measure for copyright owners, technology has also been used to eliminate unauthorized content from Internet websites. Although no international treaties exist governing the use of filtering and other technologies to assist in preventing digital piracies, many countries impose some form of filtering as part of a civil law solution to digital piracy. Thus, for example, in an early case involving unauthorized peer-topeer file trading of copyrighted works, the Federal Court of Australia in Universal Music Australia Pty Ltd. v Sharman License Holdings Ltd.,88 was faced with the defense by the provider of such software that its inability to control the actions of end users precluded any liability for copyright infringement arising from their actions. Ultimately, the court rejected this argument. It found that the defendant Sharman could have reduced the number of pirated works posted on its site by utilizing some form of filtering to determine the presence or absence of copyright management information. This ability to reduce piracy through filtering gave it some form of control over end user activities: Sharman was not able to control the decisions of individual users as to whether or not they would engage in file-sharing and, if so, which particular works they would place into their ‘My Shared Folder’ file or download from other people. However, Sharman was in a position, through keyword filtering or gold file flood filtering, to prevent or restrict users’ access to identified copyright works; in that sense, Sharman could control users’ copyright infringing activities. Sharman did not do so; with the result that the relevant applicant’s copyright in each of the Defined Recordings was infringed.89 The court recognized that filtering would not remove all pirated works but held that its ineffectiveness did not necessarily eliminate an obligation to use such technologies at least to reduce digital piracy: There are obvious difficulties about a system of keyword filtering. However, I am not persuaded it would have been beyond the ability of Sharman to overcome those difficulties. I accept any keyword filter will not be totally effective. I also accept it may sometimes produce false positives. However, the fact that a protection is imperfect is not a sufficient objection to its adoption. Even an imperfect filter would go far to protect copyright owners, provided they were prepared to go to the trouble of providing and updating a list of keywords (titles, performers etc).90 The United Kingdom has also increasingly accepted the obligation to use filtering technology to reduce digital piracy, at least in instances where the website operator has knowledge that end 87
EUCD, Article 5(3). This language broadly mirrors the fair use language of Article 10 of the WCT. [2005] FCA 1242. 89 Ibid. at ¶414. 88
90
Ibid. at ¶294
users are accessing known pirate websites. In the recently decided case, EMI Records Ltd. v. British Sky Broadcasting Ltd.,91 the court ordered the imposition of filtering blocks to prevent end users from posting Bit Torrent files secured from a well-known foreign website The Pirate Bay. In an analysis that is similar to that undertaken by Australian courts, the U.K. Chancery Division rejected the website operator’s claimed lack of control over end user activities to avoid liability: Each of the Websites actively moderates its indexed content and the activities of its users. Each of them makes clear that uploaded torrents and posted comments etc. can be removed, and will be removed in certain prescribed circumstances, for example where the content is racist or constitutes child pornography. Further, the Websites also appear to have the power to ban users who repeatedly offend against their rules and policies, and/or add prescribed files to a “special filter” capable of preventing such files from appearing again. Thus, it is clear that the operators of each of the Websites can control the content on their site and remove particular torrents. Nevertheless, they choose to index and offer hundreds of thousands of torrents which manifestly relate to infringing content and, as described below, do not even remove such content when notified by rights holders.92 Rejecting the sufficiency of a content removal policy under which the website operator removes infringing content after notice from the copyright owner, the court ordered the website owners to use blocking technology to prevent end users’ accessing and/or posting files from identified pirate websites. Similar to Sharman, the court in Sky Broadcasting acknowledged that such blocking orders might not be 100% effective, but were, nonetheless, sufficiently effective to make them a desirable weapon to combat digital piracy: [T]he evidence indicates that blocking orders are reasonably effective. The effect of the order made in Italy with regard to TPB [The Pirate Bay] referred to in 20C Fox v BT was a 73% reduction in audience accessing TPB in Italy and a 96% reduction in page views. The blocking order made in Italy in relation to KAT has had a similar effect. As for the effect of the orders made in England in relation to TPB, as at 19 December 2011, TPB was ranked by Alexa as number 43 in the UK, while as at 21 November 2012, its UK ranking had dropped to number 293.93 By contrast, the United States has a policy that generally rejects imposing filtering or other technological measures on Internet service providers (ISPs) to reduce digital piracy. As described more fully in the next section, as part of the DMCA, the United States provided “safe harbors” from liability for ISPs who complied with various obligations regarding content independence, lack of financial interest in infringing activities and expeditious removal of identified infringing works.94 The DMCA, however, expressly rejected imposing any monitoring obligation on ISPs to secure such liability safe harbors. To the contrary, Section 512(m) 91
92 93 94
[2013] EWHC 379 (Chancery Division, England). Ibid. at ¶64. Ibid. at ¶106. 17 U.S.C. §512.
expressly provides: “Nothing in this section shall be construed to condition the applicability of [safe harbor protections] on a service provider monitoring its service or affirmatively seeking facts indicating infringing activity…”95 The sole exception to this obligation is where such monitoring is “consistent with a standard technical measure.”96 A “standard technical measure” is defined as technical means used by copyright owners “to identify or protect copyrighted works” so long as such measures “(1) have been developed pursuant to a broad consensus of copyright owners and service providers in an open, fair, voluntary, multi-industry standards process; (2) are available to any person on reasonable and nondiscriminatory terms; and (3) do not impose substantial costs on service providers or substantial burdens on their systems or networks.”97 Compliance with industry technical standards can be met so long as the ISP “does not actively prevent copyright owners from collecting information needed to issue such [DMCAcompliant] notifications [to remove infringing content].” 98 Although ISPs must permit monitoring through standard technical measures, they do not have to permit copyright owners access to any monitoring technology they may use to remove infringing content where such technology does not meet the narrow definition of a “standard technical measure.”99 Thus, monitoring obligations are currently circumscribed to implementing only non-proprietary filtering and other technologies expressly designed to identify copyright infringing materials and which have been created or implemented with widespread industry approval. This rejection of any monitoring obligation is part of a larger policy balance struck between copyright holders and Internet access discussed in greater detail in the next section in connection with the grant under the DMCA of “safe harbors” from monetary liability for copyright infringement. (Injunction relief is still available.)
B. Access Denial and the Information Problem Regardless of how high the technological barrier might be raised under anti-circumvention and filtering regimes, some infringing content will inevitably make its way onto the Internet. Civil law techniques to combat this residual digital piracy generally fall into one of two categories. The first focuses on effective techniques for removing infringing content, and, more importantly, assuring that it does not reappear. The second category seeks to reduce digital piracy by reducing or denying access to the Internet by repeat infringers. Regardless of the technique chosen, category raises challenging issues about the balances to be struck between copyright protection, public access to information and Internet regulation generally. 1. Removing Infringing Content: ISP Liability and other Removal Challenges Electronic removal of an infringing copy from the Internet is a relatively straight-forward process. Unfortunately, such removal does not assure that the removed copy will not be reposted either by the original poster, or, more likely, by other end users. Even more problematic, such re-posted infringing copy will most likely be listed under a different file name so that it might not be readily apparent that it is the same infringing copy. The old adage that nothing ever 95
17 U.S.C. §512(m). Ibid. 97 512(i)(1)(b). 98 Perfect Ten v. CCBill LLC, 488 F.3d 1102 (9th Cir. 2007). 99 Viacom Intern., Inc. v. YouTube, Inc., 676 F.3d 19, 41 (2nd Cir.2012). 96
disappears from the Internet is no more problematic than in the area regulating infringing content on the Internet. At the heart of the issue over the methods governing the removal of infringing content from the Internet is the equally challenging question of who should bear the burden for monitoring and removing such content. One the one hand, internationally the copyright owner has traditionally borne the burden of assuring enforcement of such rights except in cases of commercial piracy on a commercial scale where the public interest in protection becomes paramount and the burden of enforcement is placed on prosecutors, the police and other public officials. Yet at the same time, facilitators of infringing conduct have also been held liable for contributing, authorizing or even inducing third parties to engage in copyright violations. Thus, for example, in the United States in Playboy Enterprises, Inc. v. Frena,100 the court found that the operator of a computer bulletin board was directly liable for copyright infringement when unknown subscribers had both uploaded and downloaded copyrighted photographs from the plaintiff’s magazine without permission. In a seminal case in the United States, Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd.,101 the Supreme Court held the provider of peer-to-peer file trading software contributorily liable for copyright infringement because its activities “actively induced” third parties to engage in infringing activities. The Court was careful to note that offering peer-to-peer file trading software alone would not be sufficient to qualify as illegal “inducement.” Instead evidence of the defendants’ concerted efforts to encourage third parties to infringe copyright was required: [T]he inducement rule... is a sensible one for copyright. We adopt it here, holding that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties. We are, of course, mindful of the need to keep from trenching on regular commerce or discouraging the development of technologies with lawful and unlawful potential. Accordingly,...mere knowledge of infringing potential or of actual infringing uses would not be enough here to subject a distributor to liability. Nor would ordinary acts incident to product distribution, such as offering customers technical support or product updates, support liability in themselves. The inducement rule, instead, premises liability on purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise... The classic instance of inducement is by advertisement or solicitation that broadcasts a message designed to stimulate others to commit violations. Here, the ... record is replete with ... evidence that Grokster and StreamCast... acted with a purpose to cause copyright violations by use of software suitable for illegal use. Three features of this evidence of intent are particularly notable. First, each company showed itself to be aiming to satisfy a known source of demand for copyright infringement, the market comprising former Napster users.... Grokster 100 101
839 F. Supp. 1552 (M.D. Fla. 1993). 545 U.S. 913 (2005).
and StreamCast's efforts to supply services to former Napster users, deprived of a mechanism to copy and distribute what were overwhelmingly infringing files, indicate a principal, if not exclusive, intent on the part of each to bring about infringement....Second, this evidence of unlawful objective is given added significance by MGM's showing that neither company attempted to develop filtering tools or other mechanisms to diminish the infringing activity using their software. While the Ninth Circuit treated the defendants' failure to develop such tools as irrelevant because they lacked an independent duty to monitor their users' activity, we think this evidence underscores Grokster's and StreamCast's intentional facilitation of their users' infringement. Third, ...[i]t is useful to recall that StreamCast and Grokster make money by selling advertising space, by directing ads to the screens of computers employing their software. As the record shows, the more the software is used, the more ads are sent out and the greater the advertising revenue becomes. Since the extent of the software's use determines the gain to the distributors, the commercial sense of their enterprise turns on highvolume use, which the record shows is infringing. This evidence alone would not justify an inference of unlawful intent, but viewed in the context of the entire record its import is clear.... In addition to intent to bring about infringement and distribution of a device suitable for infringing use, the inducement theory of course requires evidence of actual infringement by recipients of the device, the software in this case. As the account of the facts indicates, there is evidence of infringement on a gigantic scale, and there is no serious issue of the adequacy of MGM's showing on this point in order to survive the companies' summary judgment requests. Although an exact calculation of infringing use, as a basis for a claim of damages, is subject to dispute, there is no question that the summary judgment evidence is at least adequate to entitle MGM to go forward with claims for damages and equitable relief.102 Similarly, in Sharman and Sky Broadcasting, discussed above, webhosts and Internet service providers were held liable for “authorizing” end user’s illegal activities. To a great extent, determining the burden for monitoring and removing illegal content will depend on the extent to which Internet service providers should be held liable for the actions of third parties when such ISPs have not actively induced or directly profited from such illegal activity. Ultimately, the United States addressed this question in the Digital Millennium Copyright Act (DMCA). Significantly, the DMCA provided safe harbors from monetary liability for Internet service providers who met a broad multi-factor test – the Internet service provider must (1) qualify as a “service provider” within the meaning of the statute; (2) not interfere or with the covered activity by a third user but act only through standard technological measures; (3) lack “actual knowledge” of infringing activity or at least not be “aware” of facts or circumstances from which infringing activity is apparent; (4) not receive a “direct financial benefit” from infringing activity where it has “the right and ability to control such activity; (5) adopt and “reasonably implement” a policy of terminating in appropriate circumstances the 102
545 U.S. at 936-941.
accounts of subscribers who are repeat infringers; (6) accommodate and not interfere with “standard technical measures” copyright owners use to identify or protect copyrighted works; and (7) meet additional specified requirements depending on the particular activity for which a safe harbor is sought.103 Four activities may qualify for safe harbor protection under US law: • • • •
Serving As A Conduit For Transitory Communications; System Caching; Posting Information at the Direction of End Users (host websites); Providing Hyperlinks and Other Information Location Tools (search engines)
For an ISP to qualify for a safe harbor for hosting third party infringing content, it must also promptly remove such infringing material as soon as it has notice of the infringing content. Since as noted above, the DMCA does not impose a monitoring responsibility on ISPs, the primary method for securing the removal of infringing content is through a complex “notice and takedown” process. Under this process, the copyright owner must provide a written notice to an ISP that includes, among other requirements, a clear identification of the copyrighted work allegedly being infringed; a clear identification of the alleged infringing material, “reasonably sufficient” information that will allow the ISP to locate the material at issue; information, such as an email address, that will allow the ISP to contact the subject of the infringing activity; a statement of good faith on the part of the copyright holder; and a statement of accuracy.104 Upon receipt of a compliant notice an ISP is obligated to remove the identified material and promptly notify the subscriber of its actions.105 If the subscriber provides a timely counter-notification contending the material was improperly removed, the ISP must replace any removed material subject to receipt of a proper notice from the original complaining party that it has filed a lawsuit regarding the material in question.106 The provision of a safe harbor combined with a notice and takedown obligation, and an obligation to identify infringing end users on appropriate demand by the copyright owner,107 was part of a detailed balance between ensuring the continued growth of the Internet and providing adequate protection for copyright holders against digital piracy. The U.S. Senate announced in
103
17 U.S.C. § 512. 17 U.S.C. §512(c)(3). 105 17 U.S.C. §512(g)(2). 106 17 U.S.C. §512(g). 107 17 U.S.C. §512(h). 104
its Report regarding the desirability of such balance: The DMCA] will facilitate making available quickly and conveniently via the Internet the movies, music, software, and literary works that are the fruit of American creative genius. It will also encourage the continued growth of the existing off-line global marketplace for copyrighted works in digital format by setting strong international copyright standards. At the same time, without clarification of their liability, service providers may hesitate to make the necessary investment in the expansion of the speed and capacity of the Internet. In the ordinary course of their operations service providers must engage in all kinds of acts that expose them to potential copyright infringement liability. . . .[B]y limiting the liability of service providers, the DMCA ensures that the efficiency of the Internet will continue to improve and that the variety and quality of services on the Internet will continue to expand.”108 Because electronic removal of content from the Internet can unduly harm the ability of the general public to access the information contained within such materials,109 the DMCA also struck a careful balance between automatic removal and the protection of permitted limitations and exceptions under copyright. Article 512(f) imposes monetary liability on content owners who “knowingly, materially misrepresent” that the material in question is infringing.110 Demanding the removal of content that is a protected fair use under U.S. law qualifies as a material misrepresentation under the statute. Failure to conduct a fair use inquiry does not absolve the copyright owner from liability. In Stephanie Lenz v. Universal Music Corp.,111 the plaintiff challenged the removal of a video she had posted of her baby dancing to a barely audible soundtrack of a Prince song. The court rejected the defendant’s argument that conducting a fair use examination of a challenged use would harm the delicate balance established under the DMCA between copyright holders and end users: An allegation that a copyright owner acted in bad faith by issuing a takedown notice without proper consideration of the fair use doctrine ... furthers both the purposes of the DMCA itself and copyright law in general. In enacting the DMCA, Congress noted that the "provisions in the bill balance the need for rapid response to potential infringement with the end-users [sic] legitimate interests in not having material removed without recourse." Sen. Rep. No. 105-190 at 21 (1998). Universal suggests that copyright owners may lose the ability to respond rapidly to potential infringements if they are required to evaluate fair use prior to issuing takedown notices. Universal also points out that the question of whether a particular use of copyrighted material constitutes fair use is a fact-intensive inquiry, and that it is difficult for copyright owners to predict whether a court eventually may rule in their favor. However, while these concerns are 108
S. Rep. No. 105-190 at 8 (available bin/cpquery/z?cp105:sr190:)(accessed October 18, 2005). 109 See New York Times Co., Inc. v. Tasini, 533 U.S. 483 (2001). 110 17 U.S.C. §512(f). 111 572 F. Supp. 2d 1150 ( N.D. Cal. 2008).
at
http://thomas.loc.gov/cgi-
understandable, their actual impact likely is overstated.…Undoubtedly, some evaluations of fair use will be more complicated than others. But in the majority of cases, a consideration of fair use prior to issuing a takedown notice will not be so complicated as to jeopardize a copyright owner's ability to respond rapidly to potential infringements. The DMCA already requires copyright owners to make an initial review of the potentially infringing material prior to sending a takedown notice; indeed, it would be impossible to meet any of the requirements of Section 512(c) without doing so. A consideration of the applicability of the fair use doctrine simply is part of that initial review….[A] full investigation to verify the accuracy of a claim of infringement is not required.112 There is no international treaty requiring Internet service provider safe harbors Nevertheless, many countries have established similar safe harbor provisions. European Union Directives as a whole, establish that certain non-volitional acts may qualify for safe harbor treatment where the ISP is involved in such non-voluntary acts as serving as a conduit for other’s content,113 caching,114 and hosting (or storing)115 third party material. To qualify for such safe harbors, the ISP must generally not modify the content at issue, must not select the recipients for the materials, and must not have any actual knowledge or “awareness” of the illegal content.116 Notably, linking activities are not expressly mentioned as a safe harbor activity. As opposed to the safe harbors provided ISP’s under the DMCA, safe harbor activities detailed in the European Union Directives are not limited to material that violates copyright laws. To the contrary, such safe harbors are potentially available for all content violations, including for example, defamatory or tortious speech.117 In addition, the Directives do not impose an express duty on the ISP to monitor third party content.118 The precise scope of activities which may give rise to “knowledge” or “awareness” sufficient to lose any safe harbor is not clearly set forth in the Directives. It is, necessarily, subject to domestic law variations. Thus, for example, Recital 44 of the E-Commerce Directive, implemented by the E-Commerce Regulations in the United Kingdom states that a provider who “deliberately collaborates with recipients of a service to undertake illegal acts goes beyond the activities of a ‘mere conduit’.”119 The precise types of activities, however, that qualify as “deliberate collaboration” remains undefined. Unlike the DMCA, the EU Directives do not require compliance with notice and take-down procedures for ISP’s to qualify for safe harbor treatment. They do, however, require that, at least in the case of caching and hosting (storing) activities, the ISP must act “expeditiously” (for
112
572 F. Supp. 2d at 1155. E-Commerce Directive, Art. 12. 114 E-Commerce Directive, Art. 13. 115 E-Commerce Directive, Art. 14. 116 E-Commerce Directive, Art. 14 117 Since the Directives, however, are not generally self-executing, the extent of such safe harbors may differ under each country’s domestic laws. 118 E-Commerce Directive, Art. 15 119 E-Commerce Directive, Recital 44. 113
caching)120 or “in due diligence” (for hosting)121 to remove illegal material or disable access upon knowledge of its illegal content. The EU Directives also do not provide any simplified subpoena measures for copyright owners to obtain subscriber identification information. In fact, obtaining such information can be somewhat problematic in light of strong privacy protections contained in the EU Data Protection Directive. The European Court of Justice (ECJ) has insisted on proportionality in balancing copyright and privacy interests and held in 2008 in Promusicae v. Telefonica de España122 that identity disclosure was not required “to ensure effective protection [of copyright] in civil procedures.”123 Yet despite the initial rejection of obligatory identity disclosure, the ECJ has generally found such disclosure demands under national laws meet the proportionality test. Thus, in April 2012 in Bonnier Audio AB v. Perfect Communication Sweden AB,124 the court upheld Sweden’s domestic disclosure laws that required “clear evidence” of an infringement, that the requested information “facilitates” the investigation and that “the reasons for the measure outweigh the nuisance or other harm” the disclosure may entail. Since the national legislation enabled the court to “weigh the conflicting interests involved …taking due account of the requirements of the principle of proportionality,” the ECJ held it was “likely, in principle to ensure a fair balance between the protection of intellectual property rights enjoyed by copyright holders and the protection of personal data enjoyed by Internet subscribers or users.” Canadian law similarly eschews notice and takedown provisions in securing safe harbor status for end users. To the contrary, under Section 41.25 (1) of the Canadian Copyright Modernization Act, qualifying Canadian ISPs must simply comply with a “notice and notice” obligation to avoid liability.125 There is no initial obligation to remove content absent an injunction issued by the appropriate court. Instead, on receipt of an adequate notice from a copyright holder of the presence of infringing content on the website,126 the ISP is obligated “as soon as feasible” to forward the notice electronically to the person to whom the electronic location identified by the location data specified in the notice belongs and inform the claimant of its forwarding of the copy. 127 It must also retain records that will allow the identity of the person to whom the electronic location belongs to be determined for the longer of six months from the date of receipt of the notice, or one year from the date of filing of any court action by the copyright owner.128 No special provisions regarding the disclosure of such identity exist.
120
E-Commerce Directive, Art. 13(1)(e). E-Commerce Directive, Art. 14(1)(b). 122 (Case C-275/06)(2008). 123 Ibid. at ¶70. 124 (Case C-461-10)(2012). 125 Canadian Copyright Modernization Act, §41.25 (1)(Canadian Act). 126 Similar to the DCMA such content must specify, among other items, the identity of the work to which the claimed infringement relates; state the claimant’s interest or right with respect to the copyright in the work; specify the location data for the electronic location to which the claimed infringement relates; specify the infringement that is claimed; and specify the date and time of the commission of the claimed infringement. Canadian Act, §425(2). 127 Canadian Act, §426(1)(a). 128 Canadian Act, §426(1)(b). 121
2. Denial of Access: Three (Six?) Strikes and You’re Off the Internet ? As a last resort to removal of infringing content, various techniques are developing internationally to “remove” repeat offenders by denying them access to the Internet. There are serious questions about the effectiveness of any such denial since there are many ways to avoid a denial of access, including registering under a different name or even registering with another Internet service provider. But even more problematic is the threat such denial poses to an individual’s ability to participate in today’s information economy. In its early stages, the Internet may have been merely a convenience. But with the migration of so much information, so many social activities and so many economic opportunities onto the Internet, denial of access can cause a true hardship potentially out of proportion to the harm caused by the initial infringing activity. In a recent report by the United Nations on the role of the Internet in connection with information access and free speech, the Special Rapporteur recognized: The Internet represents a significant leap forward as an interactive medium. Indeed, with the advent of Web 2.0 services, or intermediary platforms that facilitate participatory information sharing and collaboration in the creation of content, individuals are no longer passive recipients, but also active publishers of information.129 Similarly, the European Court of Human Rights has declared: “In light of its accessibility and its capacity to store and communicate vast amounts of information, the Internet plays an important role in enhancing the public’s access to news and facilitating the dissemination of information generally.”130 This critical relationship between information dissemination and Internet access has been memorialized in numerous human rights documents. Most significantly, it has been included in Article 11 of the EU Charter of Human Rights (“Charter”) which recognizes that the right to freedom of expression includes “the freedom to...receive ... information and ideas ...regardless of frontiers.”131 Article 10 of the European Convention on Human Rights (ECHR), Article 19 of the Universal Declaration of Human Rights and Article 19 of the International Covenant on Civil and Political Rights contain this same principle, in virtually identical language.132 This freedom
129
Report of the Special Rapporteur on the promotion and protection of the right to freedom of opinion and expression, A/HRC/17/27, ¶19 (May 16, 2011). 130 Times Newspapers Limited v .the United Kingdom [2009] nos 3002/03 and 23676/03, §27 (European Court of Human Rights). 131 EU Charter on Human Rights, Art. 11(1)(emphasis added)(Charter). 132 European Convention on Human Rights, Art. 10(1)(“Everyone has the right to freedom of expression. This right shall include the freedom...to receive... information and ideas without interference by public authority and regardless of frontiers.”)(ECHR)(emphasis added); Universal Declaration on Human Rights, Art. 19 (“Everyone has the right to freedom of opinion and expression; this right includes freedom ... to seek [and] receive ... information and ideas through any media and regardless of frontiers.”)(UDHR)(emphasis added); International Covenant on Civil and Political Rights, Art. 19(2)(“Everyone shall have the right to freedom of expression; this right shall include freedom to seek [and] receive ... information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice.”)(ICCR)(emphasis added)
is not unfettered but, as Article 10(2) of the ECHR recognizes: The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary.133 Nevertheless, any restriction on Internet access must be carefully balanced given its direct implication of the right to information access. The European Court of Justice in Belgische Vereniging van Auterus, Componisten en Uitgevers CVBA (Sabam) v. Netlog NV,134 declined to order the installation of a filtering system that would search for future infringing posts on the grounds that such filtering could infringe an end user’s right to access information: [T]he effects of that injunction would not be limited to the hosting service provider, as the contested filtering system may also infringe the fundamental rights of that hosting service provider’s service users, namely their right to protection of their personal data and their freedom to receive or impart information, which are rights safeguarded by Articles 8 and 11 of the Charter respectively.135 As Sky Broadcasting136 and Sharmon137 demonstrate above, the protection of the right to information access does not preclude absolutely monitoring or other methods for reducing digital piracy, but it does require a balanced approach between protection and access: [I]n the context of measures adopted to protect copyright holders, national authorities and courts must strike a fair balance between the protection of copyright and the protection of the fundamental rights of individuals who are affected by such measures.... [I]n circumstances such as those in the main proceedings, national authorities and courts must, in particular, strike a fair balance between the protection of the intellectual property right enjoyed by copyright holders and that of the freedom to conduct a business enjoyed by operators such as hosting service providers.138
133
ECHR, Art. 10(2). See also ICCR, Art. 19(3)(“The exercise of the rights provided for in paragraph 2 of this article carries with it special duties and responsibilities. It may therefore be subject to certain restrictions, but these shall only be such as are provided by law and are necessary:(a) For respect of the rights or reputations of others;(b) For the protection of national security or of public order (ordre public), or of public health or morals.”) 134 Case C-360/10 (ECJ 2010) 135 Article 8 of the ECHR provides for the right to the protection of personal data. 136 See note 91 above. 137 See note 90 above. 138 Case C-360/10 at ¶43 -44.
This “proportionality” standard provides a useful rule of thumb for determining the extent to which any restriction on Internet access is desirable. But it is particularly important in balancing the critical question of whether a complete denial of access is warranted, regardless of how limited in time or extent such denial may be. Perhaps the most noteworthy international effort to establish a meaningful access denial prohibition occurred in France in 2009 when it enacted the “Law Favoring the Diffusion and Protection of Works on the Internet,” generally referred to as “HADOPI” after the abbreviation for the entity with administrative authority to carry out its provisions - “Haute Autorité pour la Diffusion des Œuvres et la Protection des Droits sur Internet.” Using an escalating three strikes rule, HADOPI I required individual Internet subscribers to ensure that their accounts were not accessed to “reproduce, represent, distribute, or communicate to the public” protected copyrighted works on the Internet without authorization.139 For those who failed this supervisory obligation Hadopi I established a nine-member “Authority,” empowered to send electronic notices (recommendations) to them. Under the graduated response system of HADOPI I, after a first violation, end users would receive an electronic notice of their failure to supervise their account, including a request to implement security tools to prevent such illegal uses in the future.140 A second breach (“strike”) detected within six months of the first notice would result in a second electronic notice.141 Under Article L.331-27, however, if a third breach occurred within a year of this second strike, the Authority was empowered, after an administrative hearing, to sanction the accused subscriber with, among other penalties, suspension of Internet access for a period from two months to one year.142 During this suspension period the subscriber was prohibited from entering into a service contract with any other Internet service provider.143 After a successful Constitutional challenge, HADOPI 2 was enacted with the same three strikes rule but no Internet access could be suspended without a judicial decision.144 New article L.335-7-2 of HADOPI 2, however, also required the court to take into consideration “the circumstances and gravity of the infraction” and provided that the period of suspension should balance “the protection of intellectual property and freedom of expression.”145 Under Article L.335-7-1, judges may also suspend a user’s Internet access for up to one month for gross negligence (negligence caractéresée).146 Such gross negligence occurred if illegal downloads were discovered within one year of an end user’s receiving a second recommendation from the Authority asking him to implement security tools for his account. Under this new gross negligence standard, account owners might be liable even if they are not themselves engaged in illegal P2P file trading. A subsequent challenge to the Constitutional Court was unsuccessful. Although in the first week of October 2010 an estimated 25,000 end users received notices from the Authority,147 purportedly only a single two-week suspension order was ever issued.148 In 139
HADOPI, Art. L. 336-3. HADOPI, Art. L. 331-26. 141 Ibid. 142 HADOPI, Art. L. 331-27. 143 Ibid. 144 Law No. 2009-1311, Art. 3 (October 28, 2009)(HADOPI 2). 145 HADOPI 2, Art. 1 (modifying Art. L. 335-7-2). 146 HADOPI 2, Art. L. 335-7-1. 147 Doris Estelle Long, Three Strikes and You Are Off the Internet, 156 CHI. DAILY L. BULL. 212 (October 29, 2010). 140
July 2013 HADOPI was modified to remove Internet suspension except as a supplementary penalty in cases for those found guilty of copyright infringement.149 The United Kingdom has also adopted an HADOPI-style graduated three-strike regime although it has yet to come into effect.150 More successful regimes, however, appear to be those that are imposed, not by legal fiat, but instead by contractual arrangement. Thus, in Ireland, the ISP Eircom’s agreement with content owners to remove end users engaged in three acts of copyright infringement (after receiving appropriate notices of such violations from Eircom) has been upheld.151 Recently, in the United States, various Internet service providers have entered into agreements with content providers as part of a “Copyright Alert System” that increased the traditional three-strikes rule to a six-strikes rule.152 A voluntary private agreement between content owners and five major Internet service providers – AT&T, Cablevision, Comcast, Time Warner Cable, and Verizon - the Copyright Alert System provides for notices to be sent to end users who have infringed copyright. Under the graduated response system, these notices will become increasingly pointed in nature.153 However, unlike HADOPI, there is no threat of Internet suspension. Instead, depending on the ISP, after the fourth notice, called a “Mitigation Notice,” ISPs are free to impose a variety of “penalties.” These penalties include (1) a temporary reduction of Internet speed; (2) redirection to a landing page until the primary account holder contacts the ISP; and/or (3) redirection to a landing page where the primary account holder must review and respond to educational information. On receipt of a Mitigation Notice, the subscriber has a right to request a review of the allegations. Such review will occur before an independent reviewing agency – the American Arbitration Association – and is available within fourteen (14) calendar days of receiving the Mitigation Alert. There is a $35 filing fee which fee will be refunded if the challenge to the notices is successful. As opposed to penalizing end users for their conduct, the six strikes rule of the Copyright Alert System appears directed to educating consumers regarding the infringing nature of their actions. Since the program was only initiated in early 2013, it is too soon to determine how successful it will be at reducing digital piracy. C. Reducing the Reasons for End User Piracy As opposed to crafting civil law remedies designed to reduce the instances of digital piracy, a third technique is emerging which focuses on a few of the root causes for end user piracy – price and access. In a recent report, the Australian Parliament urged the adoption of international rights exhaustion to assure greater access to digital works and a more uniform digital 148
Marc Rees, 600 Euro Fine and 15 day suspension for subscriber, PCImpact (June 12, 2013), available at http://www.pcinpact.com/news/80487-hadopi-600-d-amende-et-quinze-jours-suspensionpour-abonne.htm 149 Decret No. 2013-596, Art.2 (July 8, 2013). 150 UK Digital Economy Act of 2010, Articles 9 through 14. 151 EMI Records (Ireland) Limited & ors v The Data Protection Commissioner [2013] IESC 34. 152 See generally The Copyright Altert System, http://www.copyrightinformation.org/the-copyrightalert-system/. The precise terms of the Agreement have not been made publicly available. 153 According to the information site run by the Center for Copyright Information, who has supervisory power over the Copyright Alert System, the notices will consist of “two Educational Alerts, two “Acknowledgement” Alerts that require a response from the Subscriber, and two “Mitigation” Alerts that impose minor consequences to emphasize the seriousness of the problem.”
marketplace for copyrighted works. Although the report was not directly aimed at examining the issue of digital piracy, its concern over the impact that higher costs for copyrighted works can have on access is similar to arguments raised in support of unauthorized file trading in copyrighted works. For the past year, the Australian Government has been investigating why Australians were paying significantly higher prices for electronic goods than Americans or Brits. Although distance might explain higher shipping costs for tangible works, digital works, such as e-books, e-music and software, pose no such delivery obstacles. The statistics contained in the newly released final report of the investigation, At What Price: IT Pricing and the Australia Tax, available at http://www.aph.gov.au/parliamentary_business/committees/ house_of_representatives_committees?url=ic/itpricing/report.htm, provides chilling support for long-standing consumer fears that market segmentation generally results in monopoly prices. Of 150 products studied, Australian consumers paid on average 50% more for the same products. The IT Pricing Report goes beyond merely outlining the existence of this “Australia Tax” on digital works. It outlines a detailed plan for eliminating global differential pricing altogether. One of the most critical steps in this plan is the elimination of grey market protections under domestic copyright law. The question of the extent to which the legitimate purchase of a lawful copy of a protected work exhausts the copyright owner’s right to control subsequent distribution of that copy largely remains a question of domestic law. Most countries provide for “national exhaustion.” Thus, for example, under the “first sale doctrine,” codified in Section 109 of the US Copyright Act: “[T]he owner of a particular copy ... lawfully made under this title ...is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy...”154 In the hard goods world, the application of this national exhaustion doctrine is relatively straight-forward. Purchasers of lawfully produced copies may generally sell, rent, lease, gift or otherwise dispose of that particular copy. The copyright owner has no right to impose any contractual prohibition against such further distribution.155 In its recent decision, Kirtsaeng v. John Wiley & Sons, Inc.,156 involving a relatively simple plan by a medical student to finance his education by importing and selling in the US foreign-published editions of various US copyrighted textbooks, the Supreme Court held that the national exhaustion principle applied to all lawfully produced goods, even those manufactured abroad. It stated: “A publisher may find it more difficult to charge different prices for the same book in different geographic markets… [W]e can find no basic principle of copyright law that suggests that publishers are especially entitled to such rights.” With this decision, US copyright law moves firmly into the small but growing number of countries, including Hong Kong, Australia, Singapore and New Zealand that favor the international exhaustion of intellectual property rights. Under international exhaustion principles, once a copyright owner has transferred ownership of a copy of her work, she no longer has the ability to control the further distribution of that copy, including its resale. At the heart of the exhaustion principle, however, are two critical factors. The first is the lawfulness of the copy at issue. Pirated copies do not qualify for 154
17 U.S.C. §109. Bobbs-Merrill Co. v. Straus, 210 US 339 (1908). 156 133 S.Ct. 1351. 155
exhaustion. Neither do copies for which the copyright owner has not received adequate compensation, unless such lack of adequate compensation is the result of a bona fide fair use of the work, or the minimal compensation was agreed to by the copyright owner. The second critical factor is whether the work has been lawfully “purchased.” At least under U.S. law, distribution of works under licenses – the current practice for many digitally distributed works - still qualifies as outside the scope of first sale exhaustion. In the United States, this distinction was recently upheld in Capitol Records LLC v. Redigi, Inc.157 The defendant Redigi operated an on-line market for the resale of lawfully acquired digital music. The music in question had been obtained under licenses from iTunes which strictly limited subsequent distribution of the downloaded works. The court found that the first sale doctrine did not apply because digital works, by their very nature, do not permit the further transfer of the original object in which the copyrighted work is embodied: Here, a ReDigi user owns the phonorecord that was created when she purchased and downloaded a song from iTunes to her hard disk. But to sell that song on ReDigi, she must produce a new phonorecord on the ReDigi server. Because it is therefore impossible for the user to sell her "particular" phonorecord on ReDigi, the first sale statute cannot provide a defense. Put another way, the first sale defense is limited to material items, like records, that the copyright owner put into the stream of commerce. Here, ReDigi is not distributing such material items; rather, it is distributing reproductions of the copyrighted code embedded in new material objects, namely, the ReDigi server in Arizona and its users' hard drives. The first sale defense does not cover this any more than it covered the sale of cassette recordings of vinyl records in a bygone era.158 By contrast, the European Court of Justice in UsedSoft GmbH v. Oracle International Corp.159 held that a clearly denominated software license agreement could qualify as an act of transfer sufficient to invoke exhaustion principles because under any alternative treatment the “effectiveness” of exhaustion “would be undermined.” Defining a “sale” sufficient to invoke exhaustion as “an agreement by which a person, in return for payment, transfers to another person his rights of ownership in an item of tangible or intangible property belonging to him,”160 the court found that such a transfer had occurred, despite the denomination of the agreement between the party as a “license”: The making available by Oracle of a copy of its computer program and the conclusion of a user licence agreement for that copy are thus intended to make the copy usable by the customer, permanently, in return for payment of a fee designed to enable the copyright holder to obtain a remuneration corresponding to the economic value of the copy of the work of which it is the proprietor. ...[T]he operations examined as a whole, involve the transfer of the right of ownership of the copy of the computer program in question. It makes no difference...whether the copy of the computer program was made available to the customer by the 157
2013 U.S. Dist. LEXIS 48043 (S.D.N.Y. 2013). Ibid. at 10. 159 (Case C-128-11)(2012). 160 Ibid. at¶42. 158
rightholder concerned by means of a download from the rightholder’s website or by means of a material medium such as a CD-ROM or DVD. Consequently, in a situation such as that at issue in the main proceedings, the transfer by the copyright holder to a customer of a copy of a computer program, accompanied by the conclusion between the same parties of a user licence agreement, constitutes a ‘first sale … of a copy of a program.’161 The court rejected any limitation to exhaustion principles based on the alleged licensed nature of the work: [I]f the term ‘sale’ within the meaning of Article 4(2) of Directive 2009/24 were not given a broad interpretation as encompassing all forms of product marketing characterised by the grant of a right to use a copy of a computer program, for an unlimited period, in return for payment of a fee designed to enable the copyright holder to obtain a remuneration corresponding to the economic value of the copy of the work of which he is the proprietor, the effectiveness of that provision would be undermined, since suppliers would merely have to call the contract a ‘licence’ rather than a ‘sale’ in order to circumvent the rule of exhaustion and divest it of all scope.162 It further rejected any effort to limit the application of exhaustion principles based on the digital nature of the content: [I]t does not appear from Article 4(2) of Directive 2009/24 that the exhaustion of the right of distribution of copies of computer programs mentioned in that provision is limited to copies of programmes on a material medium such as a CDROM or DVD. On the contrary, that provision, by referring without further specification to the ‘sale … of a copy of a program’, makes no distinction according to the tangible or intangible form of the copy in question....[F]rom an economic point of view, the sale of a computer program on CD-ROM or DVD and the sale of a program by downloading from the Internet are similar. The online transmission method is the functional equivalent of the supply of a material medium. Interpreting Article 4(2) of Directive 2009/24 in the light of the principle of equal treatment confirms that the exhaustion of the distribution right under that provision takes effect after the first sale in the European Union of a copy of a computer program by the copyright holder or with his consent, regardless of whether the sale relates to a tangible or an intangible copy of the program.... To limit the application, in circumstances such as those at issue in the main proceedings, of the principle of the exhaustion of the distribution right under Article 4(2) of Directive 2009/24 solely to copies of computer programs that are sold on a material medium would allow the copyright holder to control the resale of copies downloaded from the Internet and to demand further remuneration on the occasion of each new sale, even though the first sale of the copy had already enabled the rightholder to obtain an appropriate remuneration. Such a restriction 161
162
Ibid. at ¶¶ 43 – 48. Ibid. at ¶49.
of the resale of copies of computer programs downloaded from the Internet would go beyond what is necessary to safeguard the specific subject-matter of the intellectual property concerned. 163 Notably, however, unlike the court in Redigi, the ECJ in UsedSoft did not consider the impact which the digital nature of the works might have on the nature of acts required to transfer the copy to another party. Given the ease with which owners can reproduce such works, in the absence of strong protection for “copy forward” technologies that assure that no copy of the work is retained by the owner upon its subsequent authorized distribution, application of exhaustion principles to digital copies provided under licenses by their copyright owners that restrict any such subsequent distribution may only contribute to digital piracy. Any such reconfiguration of exhaustion principles would, therefore, require a careful balance of the same competing policies of protection and access that underscore all of the civil law techniques discussed in this section. Conclusion Perfection of intellectual property laws in the face of new technologies and new communication media is a constant challenge for all countries since the printing press was first created. By virtue of the economic and communications revolution presented by the Internet, we all face challenges in balancing the competing interests of copyright protection and information access. The upcoming modifications to the 2005 Civil Code provide an invaluable opportunity to engage in a wide-ranging, critical discussion of the civil law methods and techniques that can be adapted to meet the challenges of the digital environment of the 21st Century. By including emerging international civil law techniques to combat digital piracy in the upcoming modifications, Vietnam can continue its efforts to perfect its copyright laws to reflect the benefits and necessities of the global digital environment.
163
Ibid. at ¶¶ 52, 55, 61 & 63.
