Post

Does Congress Mean to Enforce Particular Business Models with Copyright Law?

June 13, 2013 , , ,

At a hearing on unlocking phones, some suggest that
Congress added laws against circumventing access controls not just to fight
piracy, but in order to protect particular business models. Businesses use this
argument to justify using copyright law to criminalize activities that don’t
actually infringe copyright.



Up until last year, unlocking a cell phone so that it could
be used with a different carrier was perfectly legal. That changed when the
Librarian of Congress decided no longer to include it in a list of exceptions
to the Digital Millennium Copyright Act (DMCA), which forbids the circumvention
of technology that controls access to copyrighted works. The Librarian’s
decision has sparked a great deal of controversy, and lead to several proposed
bills that would once again make it legal to unlock cell phones. In a hearing
before the House Judiciary Subcommittee on Courts, Intellectual Property and
the Internet last Thursday, Congress heard testimony about one of these bills,
and about the practice of unlocking phones.

Subcommittee Vice Chairman Tom Marino began the hearing by
framing the considerations on each side in terms of their effect on the market
and existing business models, pitting the promise of a more competitive
marketplace that phone unlocking allows against the ability of carriers to
recover the cost of subsidizing phones.

The focus is telling, because this was the primary positive
argument presented for criminalizing the unlocking of cell phones – to protect
a particular existing business model. Notably absent was the claim that
unlocking cell phones in any way facilitated copyright infringement. 

Representative Zoe Lofgren commented on this, stating that,
“It’s not Congress’ role to tell people the business model they should use,”
and that using criminal law to enforce a private contract is “just a misuse of
the law.”

One of the witnesses, however, had a very different tone.
Stephen Metalitz, an attorney who has regularly represented large copyright
holders on DMCA issues, claimed that Congress had intended not only to fight
piracy, but to protect specific business models when it enacted the DMCA, and
he cited the business models that have emerged since the DMCA was enacted.
(Check out the 1:42-1:47 mark of the full hearing
video
)

Is he right? Was the DMCA drafted in order to expand the
ability of businesses to use criminal law to protect their business models?

The answer is no. Section 1201, the anti-circumvention
portion of the DMCA, specifically states that it is meant to have no effect on
rights, limitations, or defenses to copyright infringement, including fair use.
(See Section 1201(c) available here

What’s more, the standard the
Copyright Office uses
in deciding which activities should be exempt
is a simple two-part test:

  1. Does the activity infringe copyright, and
  2. Is the activity adversely affected by the DMCA?

If the process for deciding on exceptions were perfectly
effective, every activity that didn’t infringe copyright but that was
threatened by the DMCA would be exempt. This legal design shows no intent by
Congress to outlaw activities that would otherwise be non-infringing.

Unfortunately, businesses don’t want you to unlock phones
without their permission, and they can use the threat of prosecution under the
DMCA to enforce rights they don’t have. The process for deciding on exception
is complicated, and each activity is assumed to be illegal unless someone can
compile sufficient evidence to prove that it shouldn’t be. Even activities that
have previously been exempted, such as cell phone unlocking, have to be
re-approved every three years de novo (meaning it is, once again,
assumed to be illegal until proven otherwise).

Inevitably, that means that many non-infringing activities
won’t be exempt, simply for the lack of resources needed to prove that they
should be. Moreover, the uncertainty of a de
novo
triennial review may prevent programmers and other innovators from
creating new goods and services out of fear that their services may be outlawed
by the next review.

What Metalitz is doing is seizing upon flaws in the
application of the law to support the idea that Congress intended to create and
enforce the specific business models that have emerged since the law was
passed.

Of course, as Representative Lofgren claimed, it’s
inappropriate for Congress to try to enforce specific business models, and the
only way to permanently protect non-infringing activities such as cell phone
unlocking is by reforming Section 1201.

Image by flickr user izqrdo.