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Abstract:
With regard both to inhibiting Internet pornography and promoting Internet privacy, the adequacy of self-help alternatives ought to play a crucial role in evaluating the propriety of state action. Legislation that would have restricted Internet speech considered indecent or harmful to minors has already faced and failed that test. Several prominent organizations dedicated to preserving civil liberties argued successfully that self-help technologies offered less restrictive means of achieving the purported ends of such legislation, rendering it unconstitutional. Surprisingly, those same organizations have, of late, joined the call for subjecting another kind of speech - speech within or by commercial entities and about Internet users - to political regulation. With regard to privacy no less than pornography, however, self-help offers Internet users a less restrictive means of preventing the alleged harms of free speech than does state action. Indeed, a review of privacy-protecting technologies shows them to work even more effectively than the filtering and blocking software used to combat online smut. Digital self-help, in defense of Internet privacy, thus offers an alternative, making regulation by state authorities not only constitutionally suspect but also, from the more general point of view of policy, functionally inferior.

Abstract:
Copyrights and patents promote only superficial progress in the sciences and useful arts. Copyright law primarily encourages entertaining works, whereas patent law mainly inspires marginal improvements in mature technologies. Neither form of intellectual property does much to encourage basic research and development. Essential progress suffers.

Prediction markets offer another way to promote the sciences and useful arts. In general, prediction markets support transactions in claims about unresolved questions of fact. A prediction market specifically designed to promote progress in the sciences and useful arts - call it a scientific prediction exchange or SPEx - would support transactions in a variety of prediction certificates, each one of which promises to pay its bearer in the event that an associated claim about science, technology, or public policy comes true. Like other, similar markets in information, a scientific prediction exchange would aggregate, measure, and share the opinions of people paid to find the truth.

Because it would reward accurate answers to factual questions, a SPEx would encourage essential discoveries about the sciences and useful arts. Researchers and developers in those fields could count on the exchange to turn their insights into profit. In contrast to copyrights or patents, therefore, a SPEx would target fundamental progress. Furthermore, and in contrast to copyrights and patents, the exchange would not impose deadweight social costs by legally restricting access to public goods. To the contrary, a scientific prediction exchange would generate a significant positive externality: Claim prices that quantify the current consensus about vital controversies.

This article measures copyright and patent law against the Constitution's call for promotion of the Progress of science and useful Arts, to find those traditional forms of intellectual property lacking. As a cure for that policy failure, it suggests scientific prediction exchanges. Given that such exchanges offer the promise of large net public and private benefits, why don't they already thrive in the United States? Because the laws written for commodity futures, securities, and gambling markets cast a pall of legal uncertainty over scientific prediction exchanges. To ease that unwarranted burden, the article explores a variety of strategies designed to guarantee the legality of scientific prediction exchanges. The article concludes with an all-too-apt illustration of how legal risks can discourage prediction markets from promoting the progress of science and the useful arts.

prediction markets, information markets, decision markets patents, copyrights

Abstract:
We often call copyright a species of intellectual property, abbreviating it, "IP." This brief paper suggests that we consider copyright as another sort of IP: an intellectual privilege. Though copyright doubtless has some property-like attributes, it more closely resembles a special statutory benefit than it does a right, general in nature and grounded in common law, deserving the title of property. To call copyright a privilege accurately reflects legal and popular usage, past and present. It moreover offers salutary policy results, protecting property's good name and rebalancing the public choice pressures that drive copyright policy. We face a choice between two ways of thinking about, and talking about, copyright: As an intellectual property that authors and their assigns own, or as an intellectual privilege that they merely hold. Perhaps no label can fully capture the unique and protean nature of copyright. Recognizing it as form of intellectual privilege would, however, help to keep copyright within its proper legal limits.

copyright, property theory, privilege theory

Abstract:
Copyright exhibits means and ends remarkably similar to those of social welfare programs. Yet discussions about copyright do not tend to echo discussions about welfare. This paper examines that interesting contrast. It begins by comparing social welfare policy to copyright policy, uncovering several material parallels. Both welfare and copyright primarily aim to correct the market's failure to sufficiently support a particular class of beneficiaries. Both encourage rights-based claims to the entitlements that they create, too. The welfare system and the copyright system each uses statutory mechanisms to redistribute rights - rights to wealth in the first instance, rights to chattels and persons in the second - from the general public to particular beneficiary classes - the poor and authors, respectively. Each also includes special exceptions designed to avoid inefficient or inequitable redistributions. The charitable gift deduction and other tax code provisions limit the welfare system's scope, whereas copyright law offers fair use and other defenses to infringement claims. Perhaps those and other similarities between welfare and copyright mean little. After considering various critiques, however, the paper concludes that we can learn important lessons from understanding copyright as a statutory mechanism for redistributing rights. Most notably, understanding copyright as a form of authors' welfare suggests the need for, and potential shape of, reforms to end copyright as we know it.

Copyright, social welfare, redistribution, market failure, public policy

Abstract:
This paper analyses the legality of private prediction markets under U.S. law, describing both the legal risks they raise and how to manage those risks. As the label "private" suggests, such markets offer trading not to the public but rather only to members of a particular firm. The use of private prediction markets has grown in recent years because they can efficiently collect and quantify information that firms find useful in making management decisions. Along with that considerable benefit, however, comes a particularly worrisome cost: the risk that running a private prediction market might violate U.S. state or federal laws. The ends and means of private prediction markets differ materially from those of futures, securities, or gambling markets. Laws written for those latter three institutions nonetheless threaten to limit or even outlaw private prediction markets, as the paper details. The paper also details, however, how certain legal strategies can protect private prediction markets from violating U.S. laws or suffering crushing regulatory burdens. The paper concludes with a legal forecast, describing the likely form of potential CFTC regulations and a strategy designed to ensure the success of private prediction markets under U.S. law.

prediction market, private prediction market, idea futures, gambling, commodity futures, CFTC, securities

Abstract:
Good ideas do not always lead to legal acts. Setting up a prediction market in science claims, for instance, certainly sounds like a good idea. Such a market could effectively open a shortcut to the future, answering crucial questions more quickly, accurately, and cheaply than extant institutions. Notwithstanding those salient benefits, however, U.S. law does not clearly permit markets in claims about science. Such a market would not fit neatly into any common law, statutory, or regulatory category, and courts have yet to clarify the matter. This paper aims to dispel some of the legal uncertainty surrounding prediction markets in science claims and, by so doing, to help chart a path toward their implementation. The paper begins with a concise introduction to markets in science claims. It then compares them to their closest analogs in U.S. law: gambling and commodity futures trading. That comparison finds the letter of the law somewhat less congenial to markets in science claims that the policies behind it. Both forms of legal analysis leave room to argue that markets in science claims should escape the limits imposed on gambling and commodity futures trading. Ill-fitting laws threaten to hinder well-meaning acts, however, so the paper concludes by describing a few strategies for implementing fully functional, if somewhat less than fully public or legal, markets in science claims.

prediction market, prediction exchange, idea futures, science claims, gambling, commodity futures, CFTC

Abstract:
Although courts have found a misuse defense to copyright infringement, lawmakers have not yet codified it. To clarify the doctrine, and to bring the Copyright Act up-to-date with the law, this paper proposes adding a new § 107(b): "It constitutes copyright misuse to contractually limit any use of a copyrighted work if that use would qualify as noninfringing under § 107(a). No party misusing a work has rights to it under § 106 or § 106A during that misuse. A court may, however, remedy breach of any contract the limitations of which constitute copyright misuse under this section." The present paper documents § 107(b)'s codification of the judicial precedents, offers legislative history explaining the proposed statute, and discusses how the new law would work in the real world. Although the proposed codification of copyright misuse would in large part simply rationalize what courts have already said, it would also promote the salutary policy goal of encouraging the owners of expressive works to forego copyright rights in lieu of common law ones.

copyright, misuse, codification, fair use

Abstract:
The power to punish treason against the U.S. conflicts with the First Amendment freedoms of speech and of the press. Far from a question of mere theory, that conflict threatens to chill public dissent to the War on Terrorism. The government has already demonstrated its willingness to punish treasonous expression. After World War II, the United States won several prosecutions against citizens who had engaged in propaganda on behalf of the Axis powers. Today, critics of the War on Terrorism likewise face accusations of treason. Under the law of treasonous expression developed following World War II, those accusations could credibly support prosecutions. Any such prosecutions could win convictions, moreover, unless courts narrow the law of treasonous expression to satisfy the First Amendment. That potential clash between the power to punish treason and our freedoms of expression has, thanks to advances in communications technologies, become a matter of everyday concern.

In terms of abstract doctrine, the law of treason condemns anyone who owes allegiance to the U.S., who adheres to U.S. enemies, and who gives them aid and comfort by an overt act to which two witnesses testify. As courts have applied that doctrine, however, it threatens any citizen or resident of the U.S. who publicly expresses disloyal sentiments. The Internet has made it cheap, easy, and dangerous to publish such sentiments. It hosts many an expression that an eager prosecutor could cite both as proof of adherence to U.S. enemies — a subjective state of mind — and as proof of an overt act giving them aid and comfort — an objective fact to which any two of the expression's readers could testify. Even if no prosecutions for treason arise, the alarmingly broad yet ill-defined reach of the law of treason threatens to unconstitutionally chill innocent dissent. This paper details the scope of the law of treasonous expression, explains why technology threatens to bring that law into conflict with the First Amendment, and suggests a way to safely separate the power to punish treason from our freedoms of expression.

Treason, technology, freedom of expression, freedom of speech, freedom of the press, First Amendment, blogging

Abstract:
The power to punish treason against the U.S. conflicts with the First Amendment freedoms of speech and of the press. Far from a question of mere theory, that conflict threatens to chill public dissent to the War on Terrorism. The government has already demonstrated its willingness to punish treasonous expression. After World War II, the United States won several prosecutions against citizens who had engaged in propaganda on behalf of the Axis powers. Today, critics of the War on Terrorism likewise face accusations of treason. Under the law of treasonous expression developed following World War II, those accusations could credibly support prosecutions. Any such prosecutions could win convictions, moreover, unless courts narrow the law of treasonous expression to satisfy the First Amendment. That potential clash between the power to punish treason and our freedoms of expression has, thanks to advances in communications technologies, become a matter of everyday concern.

In terms of abstract doctrine, the law of treason condemns anyone who owes allegiance to the U.S., who adheres to U.S. enemies, and who gives them aid and comfort by an overt act to which two witnesses testify. As courts have applied that doctrine, however, it threatens any citizen or resident of the U.S. who publicly expresses disloyal sentiments. The Internet has made it cheap, easy, and dangerous to publish such sentiments. It hosts many an expression that an eager prosecutor could cite both as proof of adherence to U.S. enemies - a subjective state of mind - and as proof of an overt act giving them aid and comfort - an objective fact to which any two of the expression's readers could testify. Even if no prosecutions for treason arise, the alarmingly broad yet ill-defined reach of the law of treason threatens to unconstitutionally chill innocent dissent. This paper details the scope of the law of treasonous expression, explains why technology threatens to bring that law into conflict with the First Amendment, and suggests a way to safely separate the power to punish treason from our freedoms of expression.

Treason, technology, freedom of expression, freedom of speech, freedom of the press, First Amendment, blogging

Abstract:
Copyright law, originally excused as a necessary evil, threatens now to become an inescapable burden. Because state and common law rights seemed inadequate to protect expressive works from unrestricted copying, the Founders expressly authorized federal copyright legislation. Lawmakers have read that constitutional mandate liberally. Each new version of the Copyright Act has embodied longer, broader, and more powerful legal protections. Meanwhile, private initiatives have developed increasingly effective means of safeguarding copyrighted works. Alarmed that these dual trends benefit copyright owners at too great an expense to the public interest, many commentators argue that the Copyright Act should limit and preempt non-statutory alternatives. But that puts matters exactly backwards. Besieged by lobbyists and bloated by public choice pressures, the Copyright Act has fallen into statutory failure. Insofar as common law and self-help technologies unite to secure exclusive rights in expressive works, in contrast, they succeed in overcoming the market failure that originally justified the Copyright Act. If legislativeand private protections prove too powerful in combination, therefore, copyright owners should have the right to choose between the two. Rather than automatically nullifying private efforts, courts should allow the owners of expressive works to abandon the Copyright Act's protections and rely once more on non-statutory ones. Because the idea has only just begun to draw scholarly attention, this paper offers a comprehensive analysis of such an exit option. It finds that principles of law, equity, and policy favor opening an escape from copyright and describes both potential and currently functioning means of putting that theory into practice.

Escape from Copyright, copyright, market success, statutory failure, expressive works, intellectual property, preemption

Abstract:
Technological advances, because they have radically lowered the costs of creating and distributing expressive works, have shaken the foundations of copyright policy. Once, those who held copyrights in sound recordings, movies, television shows, magazines, and the like could safely assume that the public would do little more than passively consume. Now, though, the masses have seized (peacefully acquired, really) the means of reproducing copyright works, making infringement cheap, easy, and, notwithstanding the law's dictates, widespread. Copyright holders thus understandably fear that their customers have begun to treat expressive works like common property, free for all to use. That, the specter of copyism, does risk upsetting copyright policy, leading to a market failure in the production of expressive works. Even as we recognize that threat, however, we should also appreciate that technological advances have greatly reduced the costs of creating and distributing new works of authorship. Thanks to that deflation, we can increasingly count on authors who care little about the lucre of copyright - blockheads, as Samuel Johnson called them - to supply us with original expressive works. This paper describes the economic push and pull between distributed infringement and distributed authorship - between copyism and blockhead-created content, we might say - and how copyright policy should mediate those forces.

copyright, user-generated content

Abstract:
We often speak of consent in binary terms, boiling it down to "yes" or "no." In practice, however, consent varies by degrees. We tend to afford expressly consensual transactions more respect than transactions backed by only implied consent, for instance, which we in turn regard as more meaningful than transactions justified by merely hypothetical consent. A mirror of that ordinal ranking appears in our judgments about unconsensual transactions. This working paper reviews how legal and other authorities regard consent, revealing that they treat consent as a matter of degree and a measure of justification. The scale described here plays a vital role in a larger project, one that will also explain consent's importance and apply graduated consent theory to such longstanding puzzles as the enforceability of standard form agreements, the justifiability of political coercion, and the meaning of a constitution. As a preliminary to that project, this working paper explains how consent and justification vary by degree and covary in value.

consent, consent theory, scale of consent, graduated consent, unconsent, express consent, implied consent, hypothetical consent, justification, contracts, torts

Abstract:
We often speak of consent in binary terms, boiling it down to "yes" or "no." In practice, however, consent varies by degrees. We tend to afford expressly consensual transactions more respect than transactions backed by only implied consent, for instance, which we in turn regard as more meaningful than transactions justified by merely hypothetical consent. A mirror of that ordinal ranking appears in our judgments about unconsensual transactions. This article reviews how a wide range of authorities regard consent, discovering that they treat consent as a matter of degree and a measure of justification. By abstracting from that evidence, we can outline a theory of graduated consent. This article concludes by testing a graduated consent theory against such problems as enforcing standardized agreements, justifying political coercion, and reading a constitution. In those and other applications, a theory of graduated consent can contribute to legal, moral, and economic reasoning.

(Part II of this paper materially revises and expands on material first presented in, "The Scale of Consent," a working paper available at http://ssrn.com/abstract=1322180.)

consent, consent theory, scale of consent, graduated consent, unconsent, express consent, implied consent, hypothetical consent, justification, contracts, torts, constitutional interpretation, constitutional construction, citizen courts

Abstract:
Self-help plays a nearly unnoticed but increasingly important role in free speech jurisprudence. Under both the compelling interest and least restrictive means prongs of strict scrutiny, courts have determined the constitutionality of content-based restrictions on speech by comparing the efficacy of state action to that of alternative, self-help remedies. Courts and commentators, however, have yet to explore and justify how self-help does and should influence First Amendment law. Thanks largely to the obscuring effect of the captive audience doctrine, courts have invoked self-help in compelling interest inquiries in a consistent, but only implicit, manner. In contrast, although the Supreme Court has encouraged lower courts to consider self-help remedies as part of that inquiry, the Court itself has given similar consideration only very recently. The present paper thus analyzes the extant case law to reveal how self-help has powerfully affected free speech strict scrutiny jurisprudence. The paper moreover justifies self-help's role as consistent with a fundamental principle of governance: political entities should undertake only those projects that they can accomplish more effectively than can private ones. Evaluations of the relative efficacy of political and private means will change with the relevant facts, of course. As a general matter, however, technological advances giving private parties increasingly refined means of manipulating information should lead courts to reduce the permissible scope of state action. Just as we upgrade computer software to benefit from progressively better hardware, in other words, we should upgrade First Amendment jurisprudence to benefit from progressively better self-help.

free speech, strict scrutiny, self-help, first amendment

Abstract:
To forecast how blogging will impact the practice of law, we need to consider how some similar, equally revolutionary technology has impacted attorneys. I nominate the clock radio. Given that example, you might suppose that I don't think blogging will radically change the practice of law. Correct. Blogging has many virtues. It offers a largely harmless outlet for extroverted cranks and cheap entertainment for procrastinating office workers. Blogging even stands to do some very real good. I have nothing against blogging; I blog, myself. I simply don't think it will change the practice of law very much. Why not? First, because blogs seldom offer the sort of detailed and applied legal analysis that a careful attorney must perform. Second, because an attorney would find it next to impossible to practice law via a blog without violating several rules of professional responsibility. I thus conclude that neither reading nor writing blogs will have a significant influence on the practice the law.

blogging, practice of law, ethics, professional responsibility

Abstract:
Although Law and Disorder in Cyberspace gets a great deal right in boldly proposing to abolish the FCC and rely on common law courts to regulate the telecosm, an untenable distinction between the process and substance of common law runs through the text. That fundamental flaw opens a rift through which creep a number of lesser errors. Peter Huber accords antitrust law, despite its reliance on legislation and inconsistency with common law proper, inexplicable deference. In an analysis aggravated by suspect claims about the history of telecommunications, he promotes mandatory interconnection at the expense of property and contract rights. Contrary to Huber's account, moreover, common law consistently excused telephone companies from any general obligation to carry their competitors' traffic. I thus suggest that we liberate telephone companies from mandatory interconnection by letting them buy back full rights to their facilities. Law and Disorder in Cyberspace mischaracterizes copyright as an agreeable child of common law. To the extent that copyright represents a response to market failure, it perhaps infringes on common law rights for good reason. But infringe it does. I thus propose that copyright retreat where common law rights suffice to encourage creative expression. Although Huber correctly diagnoses the collectivism afflicting wireless communications policy, his preferred treatment - ownership in fee simple of the spectrum - contains a dangerously high a dose of property rights. I offer the more gentle common law solution of treating rights to the spectrum like rights to trademarks. In closing, I raise a defense on Huber's behalf: Perhaps advanced telecommunications will so improve common law's processes as to correct its substantive errors. Law and Disorder in Cyberspace does not explore that somewhat speculative counterargument, however, leaving the text with troubling, if ultimately instructive, defects.

common law, cyberspace, Huber, antitrust, interconnection, spectrum reform, copyright

Abstract:
Although Law and Disorder in Cyberspace gets a great deal right in boldly proposing to abolish the FCC and rely on common law courts to regulate the telecosm, an untenable distinction between the process and substance of common law runs through the text. That fundamental flaw opens a rift through which creep a number of lesser errors. Peter Huber accords antitrust law, despite its reliance on legislation and inconsistency with common law proper, inexplicable deference. In an analysis aggravated by suspect claims about the history of telecommunications, he promotes mandatory interconnection at the expense of property and contract rights. Contrary to Huber's account, moreover, common law consistently excused telephone companies from any general obligation to carry their competitors' traffic. I thus suggest that we liberate telephone companies from mandatory interconnection by letting them buy back full rights to their facilities. Law and Disorder in Cyberspace mischaracterizes copyright as an agreeable child of common law. To the extent that copyright represents a response to market failure, it perhaps infringes on common law rights for good reason. But infringe it does. I thus propose that copyright retreat where common law rights suffice to encourage creative expression. Although Huber correctly diagnoses the collectivism afflicting wireless communications policy, his preferred treatment--ownership in fee simple of the spectrum--contains a dangerously high a dose of property rights. I offer the more gentle common law solution of treating rights to the spectrum like rights to trademarks. In closing, I raise a defense on Huber's behalf: Perhaps advanced telecommunications will so improve common law's processes as to correct its substantive errors. Law and Disorder in Cyberspace does not explore that somewhat speculative counterargument, however, leaving the text with troubling, if ultimately instructive, defects.

Abstract:
Courts and commentators routinely claim that copyrights and patents aim to strike a delicate balance between public and private interests. No such balance exists, however. Intractable knowledge problems preclude lawmakers from even measuring the many, fluctuating, and unquantifiable interests affected by copyrights and patents, must less setting those interests in equipoise. Due to public choice problems, moreover, we can expect no better from lawmakers than indelicate imbalances in favor of certain lobbies. Copyrights and patents serve worthy utilitarian ends. They will fail to reach them, however, if we count on centralized political authorities to delicately balance public and private interests. Instead, copyright and patent policy should aim at promoting the progress of science and useful arts through the decentralized enforcement of common law rights.

Abstract:
A combination of powerful new technologies and existing legal doctrines threatens to reduce the scope of copyright's fair use defense in digital intermedia. In place of fair use, these influences will give rise to a system of fared use. Fared use seems certain to improve the efficiency of copyright law. It raises questions of equity, however, by offering copyright owners increased compensation without guaranteeing the public increased access to copyrighted works. This paper addresses those concerns. Fared use would make copyrighted materials in digital intermedia available to the public under a reciprocal quasi-compulsory license. Somewhat paradoxically, this license offers consumers cheaper and better access to such copyrighted works precisely because it would require them to pay for uses that, in other media, the fair use defense would cover. Fared use would give copyright owners more licensing opportunities, but increase the risk of objectionable reuses. This projected public bargain, the default rule under fared use, largely flows from combining automated rights management with current law. But this same technology will make it much easier for providers and consumers of copyrighted information to reach and enforce alternative, private agreements. To the extent that it threatens to preempt this new-found freedom, copyright law should step aside. Only widespread experimentation will determine which information rights best suit the digital intermedia.