DMCA, DRM & Piracy

The Virtual Jackboot

by on January 20, 2012 · 2 comments

(Cross posted at Reason.org)

Americans got a preview of what life would be like under the U.S. Senate’s Protect Intellectual Property Act (PIPA) when the Department of Justice and the FBI yesterday shut down Megaupload.com and arrested its founder and six other executives on charges of illegally sharing copyrighted material.

The move comes in the middle of a vociferous debate on PIPA and its House counterpart, the Stop Online Piracy Act (SOPA) and provides more fuel for opponents who argue that the bills threaten to undermine legal, legitimate mechanisms that are integral to the Internet technological and social utility (See my commentary posted on Reason yesterday afternoon).

PIPA supporters have argued that worries about Internet censorship and user disruption are exaggerated and the bill’s real goal is to target shadowy “rogue” sites that deal in counterfeit merchandise and pirated video downloads. Yesterday we found out just who the Feds thinks these rogue sites are.

Megaupload.com is a major commercial file-sharing site used by millions of consumers and businesses in the course of daily business. Users park large files that can then be shared among friends, family or professional workgroups. It competes directly with other such services such as Dropbox and RapidUpload. Megaupload claims to have about 50 million daily visits and even DoJ notes that at one point it was estimated to be the 13th most frequently visited site on the Internet.

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The SOPA Protest

by on January 18, 2012 · 0 comments

(Cross posted at reason.org)

It’s rare when the entire Internet industry rises up with one voice. Perhaps that’s why the protest against the House of Representatives’ Stop Online Piracy Act and its Senate counterpart, the Protect Intellectual Property Act (PIPA), is getting so much attention. In policy circles, usually one segment of the online industry is jockeying for favorable position against another. Today, with Wikipedia dark, Google taped over, and a host of other sites large and small raising awareness through home page notices, New Media is drawing its line in the sand against the most astounding government overreach into Internet regulation to date.

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Over at TIME.com, [I recap](http://techland.time.com/2012/01/09/at-the-top-of-congresss-new-year-agenda-regulate-the-net/) the latest on SOPA and PIPA and look at what’s ahead once Congress reconvenes. I also address the argument that the piracy bills don’t amount to censorship since they’re aimed at unprotected speech.

>Both bills would likely affect non-infringing speech because they allow for entire sites to be blocked — even if they also include otherwise legal speech. Yet the Supreme Court has ruled, “Broad prophylactic rules in the area of free expression are suspect. Precision of regulation must be the touchstone in an area so closely touching our most precious freedoms.” And you can add to that a troubling lack of due process that’s a recipe for abuse.

Read [the whole thing here](http://techland.time.com/2012/01/09/at-the-top-of-congresss-new-year-agenda-regulate-the-net/).

On Thursday, the House Judiciary Committee is slated to take up the misleadingly named Stop Online Piracy Act, an Internet censorship bill that will do little to actually stop piracy. In response to an outpouring of opposition from cybersecurity professionals, First Amendment scholars, technology entrepreneurs, and ordinary Internet users, the bill’s sponsors have cooked up an amended version that trims or softens a few of the most egregious provisions of the original proposal, bringing it closer to its Senate counterpart, PROTECT-IP. But the fundamental problem with SOPA has never been these details; it’s the core idea. The core idea is still to create an Internet blacklist, which means everything I say in this video still holds true.
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Over at TIME.com, I write that while Congress mulls an Internet blacklist in SOPA, there are efforts underway to reengineer parts of the Net to make communications more decentralized and censorship-proof. These include distributed and decentralized DNS systems, currencies, and social networks, as well as attempts to circumvent ISPs using mesh networking.

>It’s not a certainty that these projects will all succeed. Most probably won’t. Yet these far-out efforts serve as proof-of-concept for a censorship-resistant Internet. Just as between Napster and BitTorrent there was Gnutella and Freenet, it will take time for these concepts to mature. What is certain is the trend. The more governments squeeze the Internet in an attempt to control information, the more it will turn to sand around their fingers.

Read the whole thing here.

The Stop Online Piracy Act (SOPA), a controversial bill before the House of Representatives aimed at combating “rogue websites,” isn’t just about criminal, foreign-based sites that break U.S. intellectual property laws with impunity. Few dispute that these criminal websites that profit from large-scale counterfeiting and copyright infringement are a public policy problem. SOPA’s provisions, however, extend beyond these criminal sites, and would potentially subject otherwise law-abiding Internet intermediaries to serious legal risks.

Before moving forward with rogue websites legislation, it’s crucial that lawmakers take a deep breath and appreciate the challenges at stake in legislating online intermediary liability, lest we endanger the Nozickian “utopia of utopias” that is today’s Internet. The unintended consequences of overbroad, carelessly drafted legislation in this space could be severe, particularly given the Internet’s incredible importance to the global economy, as my colleagues have explained on these pages (123456)

To understand why SOPA could be a game-changer for online service providers, it’s important to understand the simmering disagreement surrounding the Digital Millennium Copyright Act (DMCA) of 1998, which grants certain online service providers a safe harbor from liability for their users’ copyright infringing actions. In exchange for these protections, service providers must comply with the DMCA’s notice-and-takedown system, adopt a policy to terminate users who repeatedly infringe, and meet several other conditions. Service providers are only eligible for this safe harbor if they act to expeditiously remove infringing materials upon learning of them. Also ineligible for the safe harbor are online service providers who turn a blind eye to “red flags” of obvious infringement.

The DMCA does not, however, require providers to monitor their platforms for infringing content or design their services to facilitate monitoring. Courts have held that a DMCA-compliant service provider does not lose its safe harbor protection if it fails to act upon generalized knowledge that its service is used for many infringing activities, in addition to lawful ones, so long as the service provider does not induce or encourage users’ infringing activities.

Defenders of the DMCA safe harbor argue that it’s helped enable America’s Internet-based economy to flourish, allowing an array of web businesses built around lawful user-generated content — including YouTube, Facebook, and Twitter — to thrive without fear of copyright liability or burdensome monitoring mandates.

Conversely, some commentators, including UCLA’s Doug Lichtman, argue that the DMCA inefficiently tips the scales in favor of service providers, to the detriment of content creators — and, ultimately, consumer welfare. Pointing to a series of court rulings interpreting the safe harbor’s provisions, critics argue that the DMCA gives online intermediaries little incentive to do anything beyond the bare minimum to stop copyright infringement. Critics further allege that the safe harbor has been construed so broadly that it shields service providers that are deliberately indifferent to their users’ infringing activities, however rampant they may be.

What does SOPA have to do with all of this? Buried in the bill’s 78 pages are several provisions that run a very real risk of effectively sidestepping many of the protections conferred on online service providers by the DMCA safe harbor.

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Over at TIME.com Techland, [I write about](http://techland.time.com/2011/11/07/congresss-piracy-blacklist-plan-a-cure-worse-than-the-disease/#ixzz1d2N0w6fg) the newly introduced Stop Online Piracy Act and the renewed push for a “rogue website” law.

>At a moment when Secretary of State Hillary Clinton is urging world governments to keep their hands off the Internet, creating a blacklist would send the wrong message. And not just to China or Iran, which already engage in DNS filtering, but to liberal democracies that might want to block information they find naughty. Imagine if the U.K. created a blacklist of American newspapers that its courts found violated celebrities’ privacy? Or what if France blocked American sites it believed contained hate speech? We forget, but those countries don’t have a First Amendment.

>The result could be a virtually broken Internet where some sites exist for half the world and not for the other. The alternative is to leave the DNS alone and focus (as the bills also do) on going after the cash flow of rogue websites. As frustrating as it must be for the content owners who are getting ripped off, there are some cures worse than the disease.

Read the [whole thing here](http://techland.time.com/2011/11/07/congresss-piracy-blacklist-plan-a-cure-worse-than-the-disease/#ixzz1d2N0w6fg).

For CNET today, I have a long analysis and commentary on the “Stop Online Piracy Act,” introduced last week in the House. The bill is advertised as the House’s version of the Senate’s Protect-IP Act, which was voted out of Committee in May.

It’s very hard to find much positive to say about the House version. While there’s considerable evidence its drafters heard the criticisms of engineers, legal academics, entrepreneurs and venture capitalists, their response was unfortunate.

Engineers pointed out, for example, that court orders requiring individual ISPs to remove or redirect domain name requests was a futile and dangerous way to block access to “rogue” websites. Truly rogue sites can easily relocate to another domain, or simply have users access them with their IP address and bypass DNS altogether. Continue reading →

This afternoon the Stop Online Piracy Act (H.R. 3261) was introduced by Rep. Lamar Smith of the House Judiciary Committee. This bill is a companion to the PROTECT IP Act and S.978, both of which were reported by the Senate Judiciary Committee in May.

There’s a lot some to like about the bill, but I’m uneasy about some quite a few of its provisions. While I’ll have plenty to say about this bill in the future, for now, here are a few preliminary thoughts:

  • The bill’s definition of “foreign infringing sites” at p. 10 borrows heavily from 18 U.S.C. § 2323, covering any site that commits or facilitates the commission of criminal copyright infringement and would be subject to civil forfeiture if it were U.S.-based. Unfortunately, the outer bounds of 18 U.S.C. § 2323 are quite unclear. The statute, which was enacted only a few years ago, encompasses “any property used, or intended to be used, in any manner or part to commit or facilitate” criminal copyright infringement. While I’m all for shutting down websites operated by criminal enterprises, not all websites used to facilitate crimes are guilty of wrongdoing. Imagine a user commits criminal copyright infringement using a foreign video sharing site similar to YouTube, but the site is unaware of the infringement. Since the site is “facilitating” criminal copyright infringement, albeit unknowingly, is it subject to the Stop Online Piracy Act?
  • Section 103 of the bill, which creates a DMCA-like notification/counter-notification regime, appears to lack any provision encouraging ad networks and payment processors to restore service to a site allegedly “dedicated to theft of U.S. property” upon receipt of a valid counter-notification and when no civil action has been brought. The DMCA contains a safe harbor protecting service providers who take reasonable steps to take down content from liability, but the safe harbor only applies if service providers promptly restore allegedly infringing content upon receipt of a counter notification and when the rights holder does not initiate a civil action. Why doesn’t H.R. 3261 include a similar provision?
  • The bill’s private right of action closely resembles that found in the PROTECT IP Act. Affording rights holders a legal avenue to take action against rogue websites makes sense, but I’m uneasy about creating a private right of action that allows courts to issue such broad preliminary injunctions against allegedly infringing sites. I’m also concerned about the lack of a “loser pays” provision.
  • Section 104 of the bill, which provides immunity for entities that take voluntary actions against infringing sites, now excludes from its safe harbor actions that are not “consistent with the entity’s terms of service or other contractual rights.” This is a welcome change and alleviates concerns I expressed about the PROTECT IP Act essentially rendering certain private contracts unenforceable.
  • Section 201 of the bill makes certain public performances via electronic means a felony. The section contains a rule of construction at p. 60 that clarifies that intentional copying is not “willful” if it’s based on a good faith belief with a reasonable basis in law that the copying is lawful. Could this provision cause courts to revisit the willfulness standard discussed in United States v. Moran, in which a federal court found that a defendant charged with criminal copyright infringement was not guilty because he (incorrectly) thought his conduct was permitted by the Copyright act?

I’ve written two articles on the Protect IP Act of 2011, introduced last week by Sen. Leahy (D-Vt.).

For CNET, I look at some of the key differences, better and worse, between Protect IP and its predecessor last year, known as COICA.

On Forbes this morning, I have a long meditation on what Protect IP says about the current state of the Internet content wars.  Copyright, patent, and trademark are under siege from digital technology, and for now at least are clearly losing the arms race.

The new bill isn’t exactly the nuclear option in the fight between the media industries and everyone else, but it does signal increased desperation. Continue reading →