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By Susan Scafidi, a professor at Fordham Law School and the Academic Director of the law school's Fashion Law Institute, the world's first educational center devoted to the emerging field of fashion law. In addition to her foundational articles on intellectual property and fashion design, Scafidi is the author of "Who Owns Culture?" and blogs on law and fashion at www.CounterfeitChic.com.

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Intellectual property law is being re-fashioned for a new generation. After epic battles between IP owners and the free culture crowd, a sector with a large economic footprint but a slender jurisprudential silhouette has designed a mode of protection as striking as the introduction of the miniskirt in 1965. It's unmistakably modern, covers all the essentials, but makes a point of leaving quite a bit in the public domain. Call it the new minimalism - courtesy of the not-so-frivolous fashion industry.

Perhaps it shouldn't be surprising that the industry that gave us the punch card loom, the direct ancestor of the modern computer, is on the cutting edge of development in IP. U.S. law, however, has long excluded most creative fashion designs from protection, apart from their trademarked labels and logos, even as other major fashion-producing countries have developed design rights. Europe, Japan, and India all have laws that cover fashion design; France has been protecting its celebrated Parisian couture for over a century. American fashion designers have been seeking legal recognition for at least that long, and they are finally poised to achieve it in a way that alters the contours of IP law as well.

As the nation has transitioned from agriculture to manufacturing to ideas as its primary source of economic growth, the fashion industry has followed. Americans still grow cotton and weave denim, but today, influenced by TV shows like Project Runway, there are far more aspiring designers than tailors or seamstresses. Without IP protection, though, creative garments are easily copied by design pirates who systematically troll trade shows and red carpets looking for the most popular new designs.

Given the speed at which information travels via the Internet, cheap, fast fashion copies can be shipped back to the United States and end up on the street before the original designer has a chance to recover her investment. Some designers even lose wholesale and retail orders after poorly made but otherwise nearly identical merchandise becomes available for sale. This is especially devastating to emerging designers, whose relatively unfamiliar logos are rarely copied along with the underlying articles of apparel, leaving them without even a trademark claim. As one young designer told me in regard to more established, logo-driven companies, "They can just sell their trademarks. We have to sell our designs."

In actuality, the designer was only half right. The absence of design protection also leaves a loophole for trademark counterfeiters, some of whom legally import copies of distinctive merchandise without a fake logo and then add the illegal label later. Such simple subterfuge undermines the Obama administration's new strategic plan to combat counterfeits, and ultimately IP law itself.

The bipartisan Innovative Design Protection and Piracy Prevention Act (IDPPPA) introduced by Sen. Charles E. Schumer will bring fashion design under the IP umbrella while limiting it to the shortest term of protection available under any legal system in the world, three years. It also establishes a high qualifying standard for protected designs reminiscent of patent law, but without an expensive registration requirement. Only designs that are new and original will be protected, and every other garment ever created will remain in the public domain. At the same time, the bill limits violations to substantially identical copies, a standard borrowed from trademark. As elsewhere in copyright, there are blanket exemptions for teaching and analysis; in fashion design, there's even a special home sewing exception for the clever crafter who wants to replicate the runway for her daughter's prom dress or her own wedding gown.

In addition to these lessons in legislative restraint from other areas of IP law, the IDPPPA introduces unique new procedural deterrents to litigation. And if a case does go to court, the alleged copyist will have the opportunity to show that that the design in question was created independently of the protected original. In the unlikely case that creative lightning strikes twice, or if two designers following a trend end up with stitch-for-stitch replicas of one another's work, there's no liability. Retailers who inadvertently sell illegal copies are also shielded against legal actions. While the bill's high standards and heavy burden of proof may leave some unique designs and designers unprotected, it is a distinct step forward.

For economy-minded consumers - and who isn't these days? - limited fashion design protection will mean a greater range of affordable choices, part of the kind of progress that IP law is intended to promote. The companies that originally gave us fast fashion - H&M, Zara, Topshop - are European chains, already operating under restrictions on literal copying. As a result, they employ designers to tweak the trends enough to stay out of legal trouble and also pursue licenses with famous names like Karl Lagerfeld to create legitimate versions of designer looks for those of us with couture taste and a basics budget. Some American companies like Target are already creating similar partnerships with editorial darlings like Proenza Schouler; the new IP system will make those deals with big and small designers even more attractive. The end result is more options and better translation of the latest fashions for the general public.

Unlike earlier bills, the IDPPPA represents a hand-in-glove collaboration between historically distinct stakeholders in the fashion industry, creative designers and corporate manufacturers and distributors. Over half a century ago, the A-list wore Paris originals and everyone else settled for copies - some licensed, some not. Original but inexpensive simply wasn't an option. Now that a celebrated designer like Narciso Rodriguez can dress the First Lady and create an affordable collection for eBay in the same year, the old high-low, creator-copyist divisions no longer control. The Council of Fashion Designers of America, by consulting with its fellow trade organization, the American Apparel and Footwear Association, has modeled a new consensus approach to IP law that represents the interests of creators, producers, and consumers alike. As the sole academic at the table during these discussions, my impression is of an industry that has freed itself from the philosophical debate over art versus craft, creativity versus construction, and has instead chosen to recognize and support both.

With the passage of the IDPPPA and the inclusion of fashion design among protected industries, American intellectual property law will enter a new era of restraint likely to serve as a pattern for future legislation. As Coco Chanel, who cleverly declared indifference to copying while privately pursuing legal action against design pirates, reputedly said, "Elegance is refusal." With its careful balance and refusal to accept one-size-fits-all law, the IDPPPA is indeed an elegant solution to the fashion industry's need for IP protection - narrowly tailored for an almost perfect fit.

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By Eduardo M. Peñalver and Sonia K. Katyal. Peñalver is a professor of law at Cornell University Law School and Katyal is a professor of law at Fordham University School of Law. They are authors of Property Outlaws: How Squatters, Pirates, and Protesters Improve the Law of Ownership.

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Every business owner dreams of enjoying a legally enforced monopoly. Fashion designers are no different. Although the brands and logos that appear on clothes are protected by trademark law, the designs of fabrics themselves are protected by copyright, and functional innovations in clothing are protectable by patent law, fashion designs themselves are legally, um, naked. For decades, designers have complained that, like painters, filmmakers, architects and authors, they are entitled to intellectual property protection to protect their creative efforts against unauthorized copying. So far, they have been unsuccessful. That hasn't stopped Senator Charles Schumer from teaming up with Harvard law professor Jeannie Suk to try, yet again, to make fashion designers' monopoly dreams come true.

There's broad consensus that the strongest justification for awarding intellectual property protection is to spur innovation in situations where unauthorized copying could deprive innovators of the returns on their investment in the development of new products. The classic example is the drug patent, which prevents copiers from depriving pharmaceutical companies of a return on their investment by cheaply reverse-engineering a drug that cost billions of dollars to develop. But, as the drug example makes clear, creating intellectual property protection comes at a steep social cost. Providing a limited-time monopoly to innovators allows them to charge monopoly prices. While this is arguably necessary to allow innovators to recoup development costs, it also puts the protected goods out of reach of many consumers, as we've seen in the countless debates about access to HIV medicines. Intellectual property protection also generates significant litigation, as parties spend time and resources fighting over the scope of their legal rights.

Because of its significant costs, intellectual property protection should be extended only where the gains to society are clear. The social benefits of protecting fashion innovation, however, seem like a harder case that deserves some caution. For starters, the argument that the fashion industry deserves intellectual property protection has to rest on some version of a claim that, because of copying, existing investment in fashion innovation is lower than it should be. This is a hard claim to credit without strong empirical support. The industry appears to be robust and profitable in the absence of such protections. Moreover, far from making consumers worse off, copying of fashion innovations quickly spreads them to the masses. Intellectual property protection might slow down the process, concentrating the benefits of design innovation in the hands of those who can afford to pay monopoly prices. Indeed, as Chris Sprigman and Kal Raustiala have argued, copying actually appears to drive innovation in fashion as cutting edge designers (and their wealthy customers) try to stay one step ahead of the copiers. Empirically speaking, then, legal protection for fashion may not translate into greater investment in fashion innovation on a broad scale.

But even if it did, it's not clear what (conceptually speaking) it would mean to say that more investment in fashion design - spurred by greater intellectual property protection of fashion - would make us, as a society, better off. In her work with Professor Scott Hemphill, Professor Suk has offered the intriguing argument that the existence of trademark and trade dress protection has distorted the balance of protection, since wealthier designers who have more brand identity (and can resort to trademark and trade dress protection) are less affected by design piracy than smaller, less well-established designers (who lack widespread brand identity, and are less able to take advantage of the protections that trademark and trade dress offer). For this reason, Suk and Hemphill have argued that design protection necessarily levels the playing field, enabling smaller, less well-established designers to protect their creations given their comparably weaker brand identities.

We think it is important to focus not just on the law of intellectual property as it exists on the book, but also the reality of its enforcement. The consequences of intellectual property protection for fashion are likely to be distributively biased towards the wealthiest designers - more money for major fashion houses with the resources to enforce their intellectual property rights, less for smaller innovators who are likely to find it harder to do so. Further, in the absence of robust fair use protections, designers that interpret, remix, improve upon, or alter existing designs-the "secondary design innovators" we might call them-can be caught in a grey area. Armed with new legal weapons, established designers are likely to lay claim to expansive protections, deterring the very creativity that intellectual property is designed to protect, and perhaps preventing the sort of follow-on innovation that pervades fashion trends. Like so many other areas of intellectual property that have faced this problem, the very existence of broad and imprecise intellectual property protections may have the effect of detering socially valuable innovations from taking place.

The utilitarian argument for fashion intellectual property seems quite weak. What we seem to be left with are claims by the fashion industry that fashion should be legally protected because copying is somehow immoral. But in the absence of intellectual property protection or an attempt by the copier to pass off his merchandise as the genuine article, it is hard to say that copying must be prevented at any cost. The patina of immorality from which the fashion industry draws rhetorical force almost certainly reflects the existence of intellectual property in other creative fields. Moreover, as we have argued in our recent book, copying and free riding are essential parts of the creative process: all creators begin with a common creative palette drawn from prior innovations they had no role in producing. 

Finally, granting intellectual property protection will hardly eliminate copying. One of the inevitable byproducts of intellectual property protection - in any field - is disobedience. Legal protection for fashion seems unlikely to eliminate copying any more than intellectual property protection for trademark prevents knock-offs or copyright for music has been able to stamp out file sharing. And, as we have experienced with virtually every medium currently protected by intellectual property law, we will have invited the fashion industry (and fashion consumers) onto the treadmill of ever expanding legal protection and punishment. Intellectual property protection for fashion will diminish the domain of legal conduct, and when people run afoul of their new constraints, the industry will point to that disobedience as justifying even more legal protection and punishment. We've seen this movie before. 

[image via common.wikimedia.org]

 

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By Sherwin Siy, Deputy Legal Director and Kahle/Austin Promise Fellow, Public Knowledge

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The Anti Counterfeiting Trade Agreement, or ACTA, has received a fair bit of attention in the technology press and elsewhere, more so than might have been anticipated by a trade agreement. Its staunchest opponents warn that it threatens basic freedoms of speech and due process, and jeopardizes access to effective medicines around the world. Its most vehement supporters claim that without it, thousands of American jobs will succumb to the whims of pirates and counterfeiters. Academics have raised constitutional concerns about both its process and substance, while the President has offered it up as a tool to "crack down on practices that blatantly harm our businesses." At Public Knowledge, we remain gravely concerned about its potential effects on the way we access the Internet and use the media we buy.

So what is this ACTA? A simple trade agreement? A nefarious circumvention of domestic law and legislative procedure? Something in between? And what does it actually do? The fact that such basic questions about ACTA exist and persist points to one of its most prominent and central flaws: its lack of transparency. Only the basics are offered on the U.S. Trade Representative's (USTR) website-that it is to be a "plurilateral" trade agreement between a number of countries, designed to combat the infringement of intellectual property. More recently released "fact sheets" from the USTR provide outlines for the agreement's topics of discussion, including proposals on civil and criminal enforcement, border measures, and Internet issues. (The website also features letters of endorsement for the as-yet undisclosed agreement from proponents.). Importantly, ACTA is being implemented in the U.S. as a sole executive agreement, and not a treaty of a congressional-executive agreement that would require legislative debate, consent, or approval.

As for its actual substance, the text of ACTA remains, officially, a secret. Freedom of Information Act (FOIA) requests on the text itself or drafts thereof have been rebuffed with claims that disclosure would reveal "foreign government information" that was given to the U.S. under a confidentiality agreement. An early draft of a section of the "Internet chapter" was disclosed to a small number of industry representatives and a smaller number of civil society advocates (myself among the latter), but under a non-disclosure agreement that prevents me, or any of those other people, from discussing and debating the provisions we saw openly.

The rationale for this secrecy is not particularly clear. While draft text offered by other parties might fall into the category of foreign government information, it is becoming increasingly clear that foreign governments involved in the negotiations are interested in disclosing the text. (The European Parliament, for one, has passed a resolution calling for the text to be made public.). The other reason offered for this secrecy is that it is habitual in trade agreements not to disclose negotiating positions. Yet ACTA's status as a trade negotiation seems less based in the nature of its substance than in the convenience that this designation provides. Unlike other free trade agreements, ACTA deals solely with intellectual property (IP) -- a relatively specific (but broadly significant) aspect of law and policy -- and not with any questions of tariffs, export limitations, or any other of the other areas that might necessitate negotiating parties keeping their positions in private negotiations. To the contrary, ACTA appears to contain mostly requirements for the IP laws -- requirements not limited to the goals of enforcing copyrights and trademarks -- of participating countries. Those requirements include providing for statutory damages, various types of secondary infringement, and strongly suggest enforcement mechanisms like the controversial "graduated response" or "three-strikes" rules.

We know this because a series of leaks, which include what appear to be full text and country positions. Even as the USTR assures the public that the agreement won't (and as an executive agreement, certainly can't) change U.S. law, the leaked text includes provisions that require particular interpretations of U.S. law-much of it judicially-made case law subject to ongoing interpretation and evolution. For example, one part of the Internet chapter requires member countries to include doctrines of secondary liability for infringement, using definitions and terms that can easily be more expansive than what exists in current domestic law. While this may seem like a minor detail, the determinations of such minor details are the stuff that multi-billion dollar lawsuits like the Viacom/Google litigation are made of.

Even without legislative action by Congress, differences like these can have a real influence on the course of domestic law, as international agreements are used as persuasive authority in statutory interpretation. And the history of IP law and its continual expansion give us reason to be at least somewhat suspicious that ACTA might be a form of "policy laundering." This was the case with the Digital Millennium Copyright Act, the provisions of which, after failing to capture Congress' interest, were incorporated into the WIPO Internet Treaties and then brought back to the U.S. as international obligations. The fact that ACTA conveniently was raised as a trade issue-in a forum where negotiations are more closed-has raises suspicions that this history of opportunistic forum-shifting might be repeating itself.

But the potential effects of ACTA go beyond merely nudging interpretations of U.S. law in a new direction. Acceding to a new international agreement would hamper attempts to amend some of the flaws in our current law, locking us into a system that already has apparent flaws. ACTA's effects on the laws of other countries should also be taken into account, as we want to ensure that IP laws don't unduly hamper the free speech of other countries' citizens, or, to take a more commercial tack, that IP laws don't subject US technology companies, like the makers of digital recording devices or hosting websites, to overbroad copyright liability.

None of this is intended to stand in the way of ACTA's stated goals of reducing infringement and enforcing IP laws. But while we can all agree that we do want to reduce fraudulent goods and counterfeiting, ACTA's leaked text seems to indicate that it could do much more. We could cynically assume that this is the result of a hidden purpose -- if not by its negotiators, then by those seeking to influence them. Or more charitably, these substantial flaws are the result of a lack of open, public debate on these issues.

Which brings us back to the necessary first problem with ACTA that needs to be solved before the others can be addressed -- the issue of transparency. The lack of transparency not only prevents advocates from any side from engaging in an informed, intelligent debate on the issues, it leads to a process that necessarily has an artificially constrained view of the values at stake. An agreement as broad and far-reaching as ACTA seems to be needs to be subject to public scrutiny. If sunlight is the best disinfectant, than its lack may well encourage flaws to fester, threatening not just the health of the agreement, but also of our laws and policies.

[Image via P Doodle.]

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By Sonia Katyal, Professor of Law, Fordham University School of Law & Eduardo M. Peñalver, Professor of Law, Cornell University Law School

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Fifty years ago, on Monday, February 1, 1960, Ezell Blair, Jr., Franklin McCain, Joe McNeil, and David Richmond, all freshmen at the North Carolina Agricultural and Technical University, walked into the cafeteria at the Woolworth's Store in downtown Greensboro, North Carolina. They sat down at the counter and quietly waited for service. They received none. Blair, McCain, McNeil, and Richmond were black, and Woolworth's, although not required to do so by law, followed the local "custom" of refusing to allow its black patrons to eat at its lunch counter. Though they received no service, the four men sat quietly and without incident. When the store closed at 5:30, they left. The next morning, the four young men returned, along with sixteen other students from North Carolina A&T. By Thursday morning, the ranks of the sit-in participants had swelled to over sixty. Within a month, similar sit-in protests were occurring at department stores throughout the South. The fight for civil rights would never be the same.

What had been, as one contemporary put it, a civil rights movement dominated by lawyers working quietly in courtrooms had become a mass phenomenon. The student-led sit-ins thrust the civil rights question to the forefront of the 1960 presidential elections, and there is a direct line between the students' activism and the passage of Title II of the Civil Rights Act of 1964. That landmark law, which prohibits racial discrimination in most privately-owned businesses, radically transformed rights of private ownership in the United States and has become one of our most successful civil rights statutes.

It's easy, in hindsight, to downplay the controversy that surrounded the students' tactics, but, at the time, the Greensboro protesters were maligned from all sides as threatening sacred rights of private property and the rule of law in pursuit of what many commentators considered to be a trivial interest in access to lunch counter service. Such criticism did not come just from conservatives and segregationists. According to one account, when Thurgood Marshall heard about the sit-ins, he proclaimed that "he was not going to represent a bunch of crazy colored students who violated the sacred property rights of white folks by going into their stores or lunch counters and refusing to leave when ordered to do so."

Whether the Greensboro students knew it or not, in violating property rights as they did, they tapped into a long tradition within the history of Anglo-American property law. For as long as there has been private ownership, it seems, there have been groups who have sought to challenge the prerogatives of ownership in search of a more just social order. Sometimes these movements have succeeded. More often, they have not. But the pervasive influence of these property outlaw tactics on the development of American property doctrine cannot be denied. In Property Outlaws, we explore the sit-in episode (along with scores of other examples of property lawbreaking) to try to extract broader lessons about the interaction between disobedience and ownership.

Today, forty years after the civil rights movement, we see this dialectic emerge time and time again in contemporary urban and rural environments, with respect to both tangible and intangible forms of property. The bike collective Critical Mass takes over the streets of metropolitan cities in order to reinvent the concept of public space; urban community gardeners take over vacant lots to beautify the city and create a sense of shared ecological responsibility; pirate microradio stations in the Bay Area and mashup artists interrupt everyday sonic worlds; cyberactivists like the Electronic Disturbance Theatre and others mount international electronic civil disobedience campaigns. The debates that frequently accompany these movements continue to unfold.

Drawing, in part upon the historical and contemporary context, our aim is to broaden the focus of property and intellectual property discussions beyond the common recognition of property's need for stability to include its need for dynamism, an ability to change and to fluctuate according to shifting norms, values, and social realities. We hope to rehabilitate, at least to a certain extent, the image of the intentional property outlaw, and to show how she has repeatedly played an integral role in producing our system of property and intellectual property. In doing so, we also hope to shed light on a complex and subtle tension: at the same time that property seems to be so stable and orderly, it also masks a latent instability that stems from the persistence of transgression. Far from universally undermining the value of property, however, this underlying instability is frequently constructive and indeed, necessary to prevent the entire edifice from becoming outdated.

The value of at least certain instances of disobedience is twofold. First, there may in certain situations be value in the outlaw's directly redistributive conduct. That is, there may be circumstances under which we assess that the lawbreaker's decision to take someone else's property, either for himself or to give to another, is itself valuable. We refer to this phenomenon as the lawbreaker's creation of "redistributive value." Second, in cases of persistent, widespread lawbreaking, citizen behavior may communicate useful information to property owners and to the state, indicating that some element of a property law, or some dimension of the owners' use of property, may be out of date or unjust in some respect. We refer to this signaling function provided by outlaw conduct as its "informational value." If property and intellectual property rights were perfectly enforced, either through draconian penalties or certain enforcement, each of these categories of potential value would be eliminated.

The implications of this insight differ somewhat for tangible and intellectual property. In the area of tangible property, our proposals are relatively modest, largely because the law of tangible property already contains within it a number of venerable doctrines that, in our view, acknowledge the value of a significant amount of lawbreaking. Doctrines such as adverse possession (often referred to as "squatters rights") and necessity (which permits people in emergency situations to take what they need in order to survive), provide mechanisms for nonconsensual transfers of property under certain constrained conditions. Although there have been some efforts in recent years to roll these doctrines back or limit their application, we favor preserving them and perhaps even expanding them in a number of respects. In the context of intellectual property, pervasive uncertainty as to the scope of the actual entitlement generates space for disobedience but also causes a great deal of productive behavior to labor under the threat of crippling statutory penalties.

Our aim, therefore, is to broaden the focus so that the discussion of disobedience is not just about property's need for stability, but also its need for dynamism, its ability to change and to fluctuate according to shifting norms, values, and social realities. In other words, we hope to rehabilitate, at least to a certain extent, the image of the property outlaw, and to show how she has repeatedly played an integral role in producing our system of property and intellectual property. Time and again, groups of people have intentionally violated property laws, and in a number of important cases, the law of property has responded by shifting to accommodate their demands, in the process bringing those groups back within the fold of the law-abiding community.

Wired's David Kravets notes a "landmark" federal court decision of last week that a string of torrent Web sites are unlawful, allowing for massive copyright infringements. Wired said the Dec. 21 decision, while not unexpected, is "the first in the United in which a federal judge found that" torrent or BitTorrent Web search engines are "an unlawful avenue to free movies, music, videogames and software."

The lawsuit was lodged by Motion Picture Association of America (MPAA), and resulted in a summary judgment ruling against www.isohunt.com, www.torrentbox.com, www.podtropolis.com and www.ed2k-it.com, all owned by Gary Fung. The plaintiffs, U.S. District Judge Stephen V. Wilson wrote, "asserted that, through his operation and promotion of the websites, Fung allows users to download infringing copies of popular movies, television shows, sound recordings, software programs, video games, and other copyrighted content free of charge. "

Judge Wilson dismissed Fung's arguments that his sites were distinguishable from other file-sharing sites that have been shuttered for copyright infringements, such as Napster.

The judge wrote in Columbia Pictures Industries, Inc., et al., v. Fung:

These technological details are, at their core, indistinguishable from previous technologies. In fact, Defendants' technologies appear to improve upon the previous technologies by permitting faster downloads are large files such as movies. Such an improvement quite obviously increases the potential for copyright infringement.

Fung told Wired that he was considering an appeal, maintaining that provisions in copyright law should protect Torrent sites that remove content when requested by rights-holders.

[Image via the Law Office of Lisa N. Kaufman.]

I wrote Moral Panics and the Copyright Wars with the bold goal of changing the way we think about copyright. I set this goal not out of arrogance, but out of despair - despair over the way debates over the important social issues raised by the creation and use of works of authorship have degenerated into little more than election-year mudslinging. Language has been an important weapon in these tussles, as the warring parties attempt to demonize each other.

I examine the history and myths surrounding the copyright, as well as various origin stories that attempt to find in the past people's present ideologies. I assert that copyright is a set of social relations, intended to serve the important social goals of furthering knowledge and creativity. Approaching copyright this way avoids the "them versus us" dichotomy we currently face where copyright owners claim copyright is a form of Blackstonian private property over which they can exercise absolute dominion, and conversely, where those attacking what they regard as excessive copyright protection regard copyright as an evil monopoly to be repealed.

Instead, the book explains why copyright should be regarded as a government program, intended to provide incentives for socially useful purposes. As a set of social relations, we must accept that copyright should be regulated in order to ensure it is serving its valuable public purpose. This means that calls for stronger copyright, just like calls for weaker copyright miss the point entirely; we have need only of effective copyright laws, with "effective" being measured by whether our copyright laws are serving their intended purpose. I reject therefore the copyright equivalent of free market fundamentalism, in which it is asserted markets will always represent the most rational - and therefore best - outcome.

In Article I, section 8, clause 8 of the Constitution authorizes Congress to provide copyright, but the power is discretionary, and may be exercised only in order to promote the progress of science, with science being used in its 18th century sense of learning. Congress therefore has a constitutional obligation to ensure that copyright is serving in practice, and not just in theory, to promote learning. The book argues that this obligation has been seriously undermined through the deliberate creation of moral panics: existential threats to societal values and interests. Those who start moral panics, who supposedly threaten the social order, have been described as "folk devils." Corporate copyright owners have successfully used moral panics to obtain ever-expanding copyright, and in the process have made copyright less a vehicle for achieving desired social results and more a form of private property right. Copyright's effectiveness has accordingly suffered greatly. The book sets out to refocus our attention on making copyright effective.

In making this determination of effectiveness, we should use quantitative criteria, and where the data show the need for necessary adjustments, we should make them just as we do for other government programs: if there was a government program to increase low-income housing, and credits were given to developers for that purpose, we would want Congress, before the program was authorized to conduct a study to see if low-income housing would in fact been increased, and whether the amount of the credit provided was the right amount. Copyright should be treated the same way.

The book discusses how the efforts of copyright owners to recast the debates as moral panics, as clashes between property and trespassers or pirates represent a classical response to the creative disruption (to use economist Joseph Schumpeter's term) inherent in real innovation. Innovation, by its very nature, represents a threat to the status quo, but without such disruptions, economies slide into stagnation. In a free market, stagnating businesses fail; copyright, especially recent amendments in the Digital Millennium Copyright Act, has, however, given copyright owners formidable weapons to use laws to fight the creative disruption. The book characterizes the Copyright Wars as falling squarely within the natural operations of capitalism.

The Pavlovian reaction of copyright owners against new technologies is explained as the natural but dangerous response to changes in business models. In the final chapters of the book, I look at how innovation is treated in Japan and Korea and how these countries can act as exemplars. The United States is not even in the top 10 in technological innovation; if we want to avoid being a third rate country, we have to change, and copyright law has to change too.

Delays in finalizing the proposed Google Books settlement look highly probable according to experts following the class action lawsuit. The parties involved in the proposed settlement, which if approved could give Google expansive digital publishing rights, are now negotiating aspects of the settlement, according to The New York Times.

In a recent press statement, the Department of Justice urged Judge Denny Chin of the United States District Court for the Southern District of New York to decline the settlement, and said that the "parties should be encouraged to continue their productive discussions to address those concerns."

James Grimmelmann, an associate professor of the Institute for Information and Law at New York Law School and author of an ACS Issue Brief on the settlement, told The Times:

The news out of this is that there are frantic negotiations going on in back rooms right now. The parties are scared enough to be talking seriously about changes, with each other and the government. The government is being the stern parent making them do it.

Grimmelmann's Issue Brief explored some of the public interest concerns that have arisen from the settlement, such as who will control copyright ownership of "orphan works," which are books whose authors or rights holders cannot be found.

In its statement on the proposed settlement, the DOJ also expressed concern about several aspects of it and urged the parties to "consider a number of changes to the agreement that may help address the United States' concerns, including imposing limitations on the most open-ended provisions for future licensing, eliminating potential conflicts among class members, providing additional protections for unknown rights holders, addressing the concerns of foreign authors and publishers, eliminating the joint-pricing mechanisms among publishers and authors, and, whatever the settlement's ultimate scope, providing some mechanism by which Google's competitors can gain comparable access."

In a guest ACSblog post, Center for American Progress Senior Fellow David Balto responded to critics of the settlement, calling it "good for consumers" and urging the federal court to accept it.

The deadline for most briefs regarding the Google Books settlement prompted a flurry of filings with the court. While Judge Denny Chin of the Southern District of New York began wading through the newly submitted reading material, the House Judiciary Committee held a hearing on the settlement. Among the most notable developments from the hearing was the Copyright Register's announcement that the U.S. Copyright Office opposes the settlement.

The Copyright Register told the House Judiciary Committee:

[T]he proposed settlement inappropriately creates something similar to a compulsory license for works, unfairly alters the property interests of millions of rights holders of out-of-print works without any Congressional oversight, and has the capacity to create diplomatic stress for the United States.

The next developments in the settlement's review are likely to be the Justice Department's brief, due on September 18, and Judge Chin's October 7 hearing on the matter. 

For further debate on the Google Books settlement's merits, see the ACS Issue Brief by Professor James Grimmelmann and David Balto's reply on ACSblog.

Debate continues to rage over the proposed Google Books settlement. The subject, which was the topic of an ACS Issue Brief by Prof. James Grimmelman and a ACSblog reply by David Balto, was taken up recently by Steve Pociask, president of the American Consumer Institute Center for Citizen Research.

The settlement would permit Google to give the public access to scores of "orphan works," or copyrighted material whose owners either are unknown or cannot be found.

Pociask takes issue with the settlement: 

[T]he current book search settlement gives the most dominant online firm a significant competitive advantage over its rivals, delays entry by would-be rivals and hands Google favorable pricing over other Web-centric competitors. The results would likely lead to market power that could permanently lockout competitors, thereby posing anticompetitive risks to the public. Furthermore, this would be accomplished by a single judge's decision, instead of through legislative means or public discourse, or market forces.

When surfing the Internet, consumers find most of their information using search engines, and mostly using Google. Through Web site rankings and ad placement, Google already influences how we find Web content. Google also tracks and retains your Web site browsing history for the purpose of "behavioral advertising." Now, if this court settlement is approved, Google will know exactly what you are reading.

For the complete op-ed, click here.

With a federal court contemplating a proposed settlement of a lawsuit challenging Google's book search technology, Professor James Grimmelmann examines the details. In his ACS Issue Brief, now available in the new edition of Advance: The Journal of the ACS Issues Groups, Grimmelmann writes:

For the past four years, Google has been systematically making digital copies of books in the collections of many major university libraries. It made the digital copies searchable through its web site--you couldn't read the books, but you could at least find out where the phrase you're looking for appears within them. This outraged copyright owners, who filed a class action lawsuit to make Google stop. Then, last fall, the parties to this large class action announced an even larger settlement: one that would give Google a license not only to scan books, but also to sell them.

Grimmelmann, an associate professor of the Institute for Information and Law at New York Law School, in The Google Book Search Settlement: Ends, Means, and the Future of Books, says several aspects of the proposed settlement deserve scrutiny.
Regarding the treatment of "orphan works," titles where the original copyright owner can no longer be located, Grimmelmann states:

The settlement tackles the orphan works problem, but through the judicial process. Laundering orphan works legislation through a class action lawsuit is both a brilliant response to legislative inaction and a dangerous use of the judicial power. Many of the public interest safeguards that would have been present in the political arena are attenuated in a seemingly private lawsuit; the lack of such safeguards is evident in the terms of the resulting settlement. The solution is to reinsert these missing public interest protections into the settlement.