COPYCENSE

“A federal jury in Texas awarded TiVo $73.9 million after finding that satellite dish provider EchoStar Communications Inc. infringed its patents in a case described as ‘life or death’ for the money-losing video recorder company.

“TiVo lawyers said they would seek an injunction barring EchoStar, which owns the Dish Network, from selling digital video recorders. That could help TiVo tamp down competition as it tries to build market share.

“Although TiVo is virtually synonymous with the increasingly popular digital video recorders, the company’s machines have been overshadowed by those offered by cable and satellite providers. Analysts said TiVo’s court victory could give it leverage as it seeks licensing agreements with cable operators that offer set-top boxes with built-in recorders.”

Dawn C. Chmielewski. TiVo Wins EchoStar Patent Suit. LATimes.com. April 14, 2006.

See also:

May Wong. Patent Case Win Key to TiVo Survival. Chron.com. April 13, 2005.

David Koenig. TiVo Wins Damages in Suit Vs. EchoStar. Forbes.com. April 13, 2005.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.

“The gist of the beneficial piracy argument is that the retail price Microsoft charges for signature products such as Windows and Office — as much as $669, depending on the version — can rival the average annual household income in some developing countries. So the vast majority of those users opt for pirated versions.

“The proliferation of pirated copies nevertheless establishes Microsoft products — particularly Windows and Office — as the software standard. As economies mature and flourish and people and companies begin buying legitimate versions, they usually buy Microsoft because most others already use it. It’s called the network effect.”

Charles Piller. How Piracy Opens Doors for Windows. LATimes.com. April 9, 2006.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.

Since they were enacted in 1998, the “anti-circumvention” provisions of the Digital Millennium Copyright Act (“DMCA”), codified in section 1201 of the Copyright Act, have not been used as Congress envisioned. Congress meant to stop copyright infringers from defeating anti-piracy protections added to copyrighted works and to ban the “black box” devices intended for that purpose.

In practice, the anti-circumvention provisions have been used to stifle a wide array of legitimate activities, rather than to stop copyright infringement. As a result, the DMCA has developed into a serious threat to several important public policy priorities:

The DMCA Chills Free Expression and Scientific Research.

Experience with section 1201 demonstrates that it is being used to stifle free speech and scientific research.

The DMCA Jeopardizes Fair Use.

By banning all acts of circumvention, and all technologies and tools that can be used for circumvention, the DMCA grants to copyright owners the power to unilaterally eliminate the public’s fair use rights.

The DMCA Impedes Competition and Innovation.

Rather than focusing on pirates, many copyright owners have wielded the DMCA to hinder their legitimate competitors.

The DMCA Interferes with Computer Intrusion Laws.

Further, the DMCA has been misused as a general-purpose prohibition on computer network access which, unlike most computer intrusion statutes, lacks any financial harm threshold. As a result, a disgruntled employer has used the DMCA against a former contractor for simply connecting to the company’s computer system through a VPN.

Electronic Frontier Foundation. Unintended Consequences: Seven Years Under the DMCA. April 2006.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.

“Here’s how mixtapes work: Record companies release hip-hop artists’ new songs as both finished products and separate musical and vocal tracks. These tracks are made available to D.J.’s, who piece them together to create remixes. These mixes, distributed largely through retail stores, thus give fans the latest music available — and whet consumers’ appetite for official releases issued later.

“Now here’s the kicker: virtually every mixtape features at least one famous rapper either “hosting” that mix or adding a “drop,” in which the performer gives a shout-out to the D.J. Every hip-hop artist of any consequence has participated in mixtapes. Jadakiss, Eminem, NAS and 50 Cent have all “hosted” mixtapes. So have rappers who also run record labels — including Jermaine Dupree, P. Diddy, Jay-Z and Damon Dash.

“Mixtapes are street-level, do-it-yourself products that have grown into a multimillion-dollar business. So record companies (aware of the promotional power of these tapes) provide music to D.J.’s specifically for mixes, and the rappers themselves — who are often the copyright holders — endorse the mixtapes by appearing on them. Are we to really believe that the recording industry doesn’t want these mixes distributed to fans? Of course it does.

“But under the current system, the only people who risk punishment are the retailers. I know about this firsthand.”

Alan Berry. The Tale of the Tapes. The New York Times. April 11, 2006.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.

The internationalization of intellectual property law was a topic that arose during a workshop I led last weekend at Information Today’s Buying & Selling eContent conference in Scottsdale, Ariz. Thus, I find it interesting that one of News.com‘s recent lead stories discusses the United States’ efforts to stem widespread intellectual property infringement in China.

The workshop discussion about the international aspects of intellectual property laws began with a question from Bob Pemberton, one of the workshop participants. Pemberton asked about the differences between copyright law among different countries soon after I had explained that in the United States, contract law is different from state to state, but essentially is standardized by states’ nearly universal adoption of the Uniform Commercial Code.

With respect to copyright law, I explained to Pemberton and the rest of the participants that copyright law is unique from country to country. Therefore, the copyright law of the United States is different than the copyright law of France, which is different from the copyright law of China. But I added that given international treaties and compacts like the Berne Convention for the Protection of Literary and Artistic Works, copyright laws increasingly are being standardized across the industrialized nations.

I added that I find it interesting that the United States has made intellectual property protection a centerpiece of discussions it has with other nations concerning international trade. Usually, the U.S. takes a carrot-stick approach to trade negotiations, essentially saying “If you want to export certain products to the United States, you have to pledge to protect diligently American intellectual property products.” The U.S. has said this to China with increasing urgency over the last few years, so it is little surprise that American trade representatives are imploring Chinese officials to stem the flow of illegal American intellectual property (including films, music, and computer software) within its borders.

A press release issued Tuesday from the Office of the United States Trade Representative said

At [this week’s] meeting, China committed to addressing a number of U.S. trade concerns in three areas: enhancing access of U.S. companies and farmers and ranchers to the Chinese market; improving protection of intellectual property rights in China; and moving toward a transparent and market-oriented system of government procurement in China.

The Chinese agreed to the following: reopening its market to U.S. beef exports; launching negotiations to join the WTO government procurement agreement; requiring Chinese computers to use legal software; closing optical disk plants that produce pirated CDs and DVDs and stepped up enforcement of IPR; requiring all trade-related measures to be published in a single official journal; eliminating barriers to trade in medical devices; and the launching of a dialogue on the steel industry. These actions have resulted from extensive discussions between U.S. and Chinese officials over the past six months. (Emphasis added.)

One of the most interesting aspects of the give and take between the U.S. and China is that it occurs at a time when large, multinational American businesses desperately want access to the Chinese market — perhaps even more than Chinese businesses want access to the American market. This means that Commerce Secretary Carlos M. Gutierrez and U.S. Trade Representative Rob Portman are likely to adopt a much more conciliatory posture in negotiations with China than they would with a country like Peru, which has virtually no negotiating leverage with the U.S.

Portman’s softer tone on matters involving China is interesting even though the BSA, the software industry’s lobbying arm, identifies China as a country with the world’s third highest piracy rate. (.pdf)

Anne Broache. U.S. Calls for More Antipiracy Action from China. News.com. April 11, 2006.

See also:

Office of the United States Trade Representative. United States and Peru Sign Trade Promotion Agreement. April 12, 2006.

Office of the United States Trade Representative. United States Welcomes Chinese Action on Key Trade Issues Positive Steps on Market Access, IPR and Procurement; More Needs to Be Done. (Press release) April 11, 2006.

CopyCense. Big Software Rolls Out Piracy Frame. Dec. 14, 2005.

Office of the United States Trade Representative. The U.S. – China Joint Commission on Commerce and Trade (JCCT) Outcomes on Major U.S. Trade Concerns. (Press release) July 11, 2005.

Updates:

Pete Engardio and Catherine Yang. The Runaway Trade Giant. BusinessWeek Online. April 24, 2006.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC. CopyCense™ and CommuniK.™ are trademarks of Seso Digital LLC.

“Athletic shoe and apparel maker Adidas said Tuesday it signed an 11-year deal with the National Basketball Association that will make the German company the official uniform provider for the U.S. league.

“The company said the deal also includes providing uniforms and other products for the Women’s National Basketball Association and the NBA Development League, starting with the 2006-2007 season.

“Adidas-Salomon AG, which has been a marketing partner of the NBA since 2002, said the deal resulted from its acquisition last year of Reebok International Ltd., the NBA’s uniform and apparel provider since 2001.”

Matt Moore. Adidas Signs 11-Year Deal With the NBA. Forbes.com. April 11, 2006.

See also:

NBA.com. adidas to Become Exclusive Uniform and Apparel Provider for NBA, WNBA and D-League. (Press release) April 11, 2006.

CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.