Today (Jan. 28, 2016) the White House released a long-awaited White Paper on Remixes, First Sale, and Statutory Damages in current Copyright Law; part of it draws heavily from the comments submitted last year by the Organization For @transformativeworks – and a lot of it quotes multinational rightsholders, copyright “protection” NGOs, professors, think tanks, the EFF and Google; in other words, a lot of views are represented and a number of recommendations are made.
Generally, we like what it has to say; it’s informative and it sets forth explanations of some complicated aspects of IP law in plain language that will be useful for lawyers litigating or explaining things, and also for laypeople.
Because we are FYeahCopyright, our first read of most of the 100ish pages looked over the remix section, and also the Statutory Damages section. Fair Use is, as we’ve said a number of times, a great way aspect of US copyright law because it allows people to get creative with the stories, images, music and magic that’s inspired them, to create remixes, transformative works, etc. But the risk of statutory damages, which can be considerable, silence innovation and creativity on so many different levels, because of the monetary risk if you think something is fair use – or public domain – but you’re wrong (if the standards narrow, for example, or because the law isn’t identical across the US, also see White Paper p.9).
The Task Force wants Congress to amend the US Copyright Act – keep reading to see what they want added to the Statutory Damages section…
FACTORS TO CONSIDER – In making any award under this subsection, a court shall
consider the following nonexclusive factors in determining the appropriate amount of the
award:
The plaintiff’s revenues lost and the difficulty of proving damages.
The defendant’s expenses saved, profits reaped, and other benefits from the
infringement.
The need to deter future infringements.
The defendant’s financial situation.
The value or nature of the work infringed.
The circumstances, duration, and scope of the infringement, including whether it
was commercial in nature.
Now, we already know that under current Fair Use law, the commercial nature of the follow-on/transformative work isn’t the sole factor, and it wouldn’t be under the Amended Copyright Act either. And this isn’t law now – it has to be passed by Congress, but it might be a bipartisan thing that both sides are willing to work on together.
So the only thing we’d actually add to this is that it would be awesome if the courts had to look at how the Plaintiff benefits from the infringement; does the follow-on work bring new fans to a work or a product or project?
Did the infringement cause the Plaintiff to be distracted like Kanye?
Did the plaintiff use the follow-on work in any way, like in marketing or promotion of the source-work?
It could and should be relevant!
If the circumstances of the infringement have to be considered by a court, then if the infringer had reasonably thought that the follow-on work was fair use or otherwise noninfringing, but was wrong, the damages would have to be lower. Would #4 mean that damages couldn’t be so high as to bankrupt a defendant that wasn’t maliciously counterfeiting a commercial work for commercial purposes? Would an orphan work that’s been out print for decades be seen under #5 as lower-valued and thus less entitled to statutory damages, though fully entitled to the defendant’s profits?
Nobody knows yet, but this White Paper is, at least, a framework on what Congress – and later, the courts – can set out to reduce some of the chill caused by statutory damages.
It’s interesting that the Task Force has chosen to focus on changing the Copyright Act to limit statutory damages, rather than mandate licensing schemes or set out Fair Use guidelines – and it could have a more positive impact, if the law ever gets amended.
A number of commenters noted that statutory damages, which are currently set forth in the Copyright Act, range into the hundreds of thousands of dollars, and even the prospect of obtaining those damages from a defendant can keep litigation going on until a defendant – even one who is noninfringing – has been bankrupted by a perpetual lawsuit. The risk of statutory damages chills corporate innovation and original creativity, keeping from the public new works of art, literature and music, and detering “some new business plans that rely on fair use from moving forward.” Of course, some rights-holder-centric groups disputed it, but we all know people who’ve pulled stories and art, or avoided a cosplay project or had something removed from YouTube or etsy because someone thought it was infringing, even if it was actually noninfringing because of Fair Use.
For the past three years, some have wondered if the White Paper would include a recommendation for a new mandatory licensing system for music, books, art, etc, but the White Paper notes that the commentators do not “believe it advisable to
create a new exception or a compulsory license.” This is good for Fair Use, because as the Paper states:
It is important that the copyright framework continues to allow the broad
range of remixes to thrive, ensuring that a vibrant fair use space coexists with effective licensing
structures.
The Task Force will not recommend “abandoning the multifactor approach of fair use …[because]… fair use, which requires consideration
of the purpose of the use, the nature of the copyrighted work, the amount of the work used, and
its effect on the market or potential market, represents a nuanced and balanced approach that has
worked well in the United States. (White Paper, p. 25)
They also will not mandate guidelines on what is and is not Fair Use, and here’s why:
Best practices and
guidelines cannot be comprehensive codes enumerating everything that can be done in a
particular realm of activity.
A more modest endeavor, aiming to identify what conduct can be
agreed on as permissible or impermissible, can serve a valuable function. Such a process would
leave gaps in that there will be some conduct as to which no guidance is offered, either because
the fair use status is too unclear or because stakeholders hold divergent views. This does not
mean that the outcome is not worthwhile.
Page 29 sets forth some ideas for guidelines creation, and it’ll be interesting to see if those steps and recs are followed between fans and The Powers That Be. Fwiw, it looks like we’ll be sticking around to continue to explain Fair Use and its parameters – we’re pretty happy about that!
Google’s Fred Von Loehmann noted that amateur creators such as those starting out on YouTube often
want to become professionals, but may find it difficult to negotiate the transition from amateur to
professional given the different “clearance culture” in the professional world.
We wonder if this Task Force White Paper might have some impact on that transition; if it’s less (financially) risky to share your creativity, will those giving clearance become less risk-averse and more open to arguments that a specific work is Fair Use and thus noninfringing?
Let’s see what comes next.
I need to read this (the whitepaper) once I have time.
