October 2008

WASHINGTON, October 30 – At the National Press Club, Larry Irving and Grover Norquist are debating technology and the presidential candidates. Check out the side of the page on DrewClark.com, or at http://twitter.com/drewclark, for my live Twitters!

Alex’s excellent post on the enforceability of shrink-wrap contracts produced a lively debate that’s worth checking out. In particular, my friend Wilson mounts a spirited defense of the proposition that if a customer has a reasonable expectation that a Gateway computer will arrive with a contract attached, and if Gateway offers to pay for return shipping if the customer does not wish to be bound by the contract, then it’s reasonable to consider the the customer bound by the contract if he does not return the computer to Gateway.

I think there are several reasons to be skeptical of this position, but rather than re-hash the arguments I made in the comments to Alex’s post, I think it’s worthwhile to step back and consider the broader principle at stake here. Libertarians are, of course, in favor of freedom of contract, but it’s important to understand what freedom of contract means. Some libertarians seem to think that being in pro-freedom of contract means being pro-contract in the sense that the government should make contract formation as easy as possible and should enforce as many contracts as possible. For example, a few weeks back I criticized an article by F. Scott Kieff that seemed to take this kind of view with respect to patent law.

I think this is a mistaken conception of what freedom of contract is all about. At its heart, freedom of contract is about peoples’ freedom to enter or not enter contractual relationships, and to be confident that the government will enforce valid contract in a predictable manner. The “or not enter” part is important. It violates freedom of contract for the state to fail to enforce a contract to which both parties have consented. But it’s no less a violation of freedom of contract to enforce a contract to which one of the parties did not consent.

And I think we should be extremely skeptical of inferring an affirmative obligation based on someone’s failure to take some action demanded by another party. Complying with such a demand always has costs (I might live far from the nearest post office and not have a car, for example), and I shouldn’t have to bear costs simply to avoid being a party to a contract I never indicated interest in being party to in the first place. And no, the fact that computers often come with attached EULAs doesn’t mean that I “should have known” that there would be a EULA in the box. Courts can’t read minds; the enforceability of contracts needs to be about peoples’ actions, not speculation about what they did or should have known.

Supreme CourtGamePolitics.com reports that there are strong signs the protracted legal battle over video game regulation in California might soon be headed to the Supreme Court. The ongoing battle deals with a California law passed in October 2005 (A.B.1179), which would have blocked the sale of “violent” video games to those under 18 and required labels on all games. Offending retailers could have been fined for failure to comply with the law.

The law was immediately challenged by the Video Software Dealers Association and the Entertainment Software Association.  In August of last year, a district court decision in the case of Video Software Dealers Association v. Schwarzenegger [decision here] enforced a permanent injunction against the law. And today in Sacramento, a 3-judge panel of the 9th U.S. Circuit Court of Appeals held a hearing in to hear additional arguments about the law. The San Jose Mercury News reports that judges seemed skeptical about the State’s effort to overturn the lower court ruling and get the law enforced:

While the 9th Circuit judges did lend some support to the state, they were generally skeptical the law can survive. “What you are asking us to do is go where no one has gone before,” Judge Consuelo Callahan said to the state’s lawyer. “Admittedly, they are disgusting. But aren’t you just trying to be the thought police?”

The judges also realize that every other state or circuit court that has considered the constitutionality of similar video games laws has found them unconstitutional. As I noted in my piece last year on the California law, the current legal score is “Gamers 11, Censors 0.”  If the Ninth Circuit does keep the injunction in place and California appeals the law up to the Supreme Court as some predict, we could be in for a historic First Amendemt case, and the first to deal with video game speech. Stay tuned!

Yesterday, after my Criminal Law class, I went to a lunch talk sponsored by the Stanford Biolaw and Health Policy Society about “abandoned” DNA – that is, DNA traces that people leave all over the place. It was given by Prof. Elizabeth Joh, visiting Stanford Law this year from UC Davis Law. She focused on her recent law review article on the subject.

Joh’s basic argument was that DNA is fundamentally different than the other detritus we abandon on a regular basis. She contended that, though we might not have an expectation that the soda bottle we tossed into the public trash can won’t be seen by anyone, we have an expectation that it won’t be mined for our saliva and the genetic information it contains. Joh even argued that DNA traces are fundamentally different from fingerprints, since fingerprints can only identify us, but cannot give investigators a view into fundamentals about who we are (including our health risks).

Joh contrasted her view, which focuses on privacy, from what she called the “old” trespass view. Under that perspective, what was wrong about an FBI agent slipping into your house to implant bugs was not that the government could now listen into everything you say in your home, but rather the property violation involved in breaking in. Similarly, under the trespass view, a cop could not run a cotton swab on the inside of your mouth to collect DNA (without a warrant) because it would violate your property in yourself, not because it would reveal your genetic information to the government. But the trespass view would have no problem with the government picking up that soda bottle out of the trash and collecting your DNA from it, to match you to a crime. Continue reading →

At first glance, it seems to me that this big settlement announced today between Google and the book publishers regarding Google Book Search sounds a lot like an ASCAP model for online book transactions. Specifically, of the key provisions of the agreement, it’s this last one about the Book Rights Registry that makes me think of ASCAP:

Compensation to Authors and Publishers and Control Over Access to Their Works – Distributing payments earned from online access provided by Google and, prospectively, from similar programs that may be established by other providers, through a newly created independent, not-for-profit Book Rights Registry that will also locate rightsholders, collect and maintain accurate rightsholder information, and provide a way for rightsholders to request inclusion in or exclusion from the project.

That’s basically what ASCAP does today, and I think this sounds like a pretty good plan for books going forward. But I also find myself wondering: Could this be the beginning of a move toward a more comprehensive online collective licensing system for other types of content as everything moves online. For example, could this model work for music? EFF has argued it could. And some in the music industry appear to be moving in that direction. (Talk about your strange bedfellows… EFF and the RIAA potentially on the same side of an issue!)

Of course, you’d need to get a lot more companies than just Google to play ball to make it work for music — specifically, you’d need all the ISPs on board. For books, by contrast, the reason today’s deal will likely work is because Google has been the only online operator with the scale and interest in putting the entire contents of so many books online. But all music is already online and much video is heading online, too. So, I think it would be much, much more challenging to make collective licensing work for music and video the way it appears it might work for books. (We’d probably need compulsory licensing instead, which I am no fan of). The key to these voluntary collective licensing systems is large, trusted intermediaries that can clear a massive volume of transactions. Google can do that for books as today’s deal makes clear. It will be interesting to see if others suggest that music and video can and should work the same way. I’m skeptical, and I’m also a bit hung up on some fairness issues about how it would work, which I might touch upon in a future essay.

But I’m no copyright expert so I’d be interested in hearing what my colleagues and others think.

Update: Looks like someone beat me to the punch with the ASCAP comparison. I just starting reading through my RSS feed and finding reaction from others and came across Mathew Ingram’s post arguing that, “In effect, Google is setting up a body that does what ASCAP and similar groups do for musicians.”

Should U.S. businesses involved in Internet commerce do business in nations governed by oppressive regimes? This is a question that many libertarians—including some of us on TLF—have grappled with for some time.

Now Yahoo, Google, and Microsoft have signed on to a set of principles for conducting business in countries that disregard human rights. Today’s Wall Street Journal reports:

Under the new principles, which were crafted over two years, the technology titans promise to protect the personal information of their users wherever they do business and to “narrowly interpret and implement government demands that compromise privacy,” according to the code.

It’s welcome news for defenders of liberty that U.S. Web giants plan to play hardball with foreign governments who would use information gleaned from Internet firms to violate their citizens’ human rights. Several troubling reports have surfaced in the past few years about American companies abetting egregious actions by oppressive governments. In January, Indian police beat a man whose arrest stemmed from Google’s cooperation with the Indian government. And in 2005, Yahoo gave information to the Chinese government that led to the arrest of a journalist accused of giving out state secrets (the case was later overturned).

Continue reading →

Presumably, everyone reading this post has purchased software at some point in the past 15 years. If you have, you may have agreed to a contract unwittingly. Breaking the seal of the shrinkwrap around the box might bind you to the terms and conditions contained inside. This is but one of many new ways you can be determined to agree to contractual terms you may have never seen.

In the last decade, Gateway came under fire for its means of doing business with consumers. A customer would order her computer over the phone, but when it would come, it would contain a list of terms including things like a mandatory abritration clause – and always stating that the customer was deemed to have accepted the terms by not returning the computer (at her expense) by some period of time. A number of court cases raised the question whether this practice really created a binding contract. 

As libertarians, we are generally in favor of contracts. But a contract is a mutually consensual agreement. The critical question for shrinkwrap contracts and the like is whether both parties have really assented. In the Gateway cases, there are three main interpretations of what is going on: Continue reading →

JZIf you’re here in D.C. next Thursday, you might want to drop by the New America Foundation to watch Jonathan Zittrain and me go at it about his important new book, The Future of the Internet and How to Stop It.  Our debate will take place on Thursday, November 6th from 3:30 – 5:00 p.m. at New America Foundation headquarters (1630 Connecticut Ave, NW, 7th Floor).  My old friend (but frequent intellectual sparring partner) Michael Calabrese will also be speaking.  Michael is the Director of New America’s “Wireless Future Program” and one of the all-around nicest guys in the world of tech policy.  You can RSVP for the event here.

I’ve been quite critical of the thesis that Jonathan sets forth in his book, and I have discussed my reservations in a lengthy book review and a series of follow-up essays here and elsewhere.
(Part 1, 2, 3, 4, 5). We’ve also debated his book on the an NPR-Boston affiliate station if you care to hear a preview of our debate next week.  That show is online here.

I encourage you to join us for what promises to be a very interesting discussion.  As I pointed out in my original review of his book, if you have never had the chance to hear Jonathan speak, you’re in for a real treat.  He is, bar none, the most entertaining tech policy wonk in the world.

Again, RSVP here.

Jesse Walker has a terrific feature story looking “Beyond the Fairness Doctrine” in this month’s issue of Reason magazine. I highly recommend it. It’s an in-depth exploration of what an Obama Administration means for the future of tech and media policy. Walker rightly opens the piece by noting that “The fairness doctrine is still dead, and it probably will stay dead even if Barack Obama becomes president.” The danger, however, is that an Obama FCC will still pursue a variety of onerous regulatory objectives that could do a great deal of damage to markets and free speech.

Walker touches upon the various issues that will likely be a priority for an Obama Administration and the Left-leaning media reformistas like Free Press, Media Access Project, Public Knowledge, and New America Foundation. Those policy issues include: net neutrality, “localism” mandates and increased “community oversight” regulations, media ownership rules, minority ownership requirements, increased merger meddling, spectrum policy, and other new “public interest” obligations.

Of course, as Walker also correctly points out, it is difficult to see how things could get much worse than they have been under Bush Administration’s FCC and the leadership of Chairman Kevin Martin.  Walker was kind enough to quote my thoughts on this point: “Martin is the most regulatory Republican FCC Chairman in decades,” I told him. “He wants to control speech and will use whatever tools he has to get there.”

I stand by those words, but I am also aware that things could get worse — much worse — under a Democratic FCC influenced by radical Leftist activists like Free Press.  Indeed, in our new book A Manifesto for Media Freedom, Brian Anderson and I inventory the many looming threats to media and technology freedom that exist today and show how most of them arise from the Left.  As Walker notes in his article, however, it is unlikely that a re-empowered Democratic FCC would come right out of the gates with the same sort of command-and-control approaches they’ve employed in the past.  And we’ll still have to worry about some right-of-center lawmakers and regulatory joining some of these misguided campaigns. “The real danger,” Walker concludes in his piece, “is more subtle and more mundane.  It’s a bipartisan bureaucracy slowly, steadily increasing its power.”    Make sure to read Jesse’s entire piece.  Great stuff.

Read Matt Lasar’s article on Ars today (“Satellite Radio Minority Channel Decision Looms for FCC“) about how somebody has suggested that Irish-Americans “deserve a channel on satellite radio which informs, educates and entertains them with all things Irish.”

Folks, you just can’t make up stuff this good.