2 Berkeley Journal of Entertainment and Sports Law (2013)
42 Pages Posted: 8 Jan 2014 Last revised: 28 Jan 2014
Date Written: October 8, 2012
The friction between copyright protection and internet freedom has hit a political boiling point. In the Spring of 2012, public outcry shut down SOPA, PIPA and ACTA, and prompted the unveiling of the Electronic Communication Privacy Act and the Global Free Internet Act in the House of Representatives. Furthermore, FCC net neutrality rules have been challenged in federal court by Verizon and MetroPCS. Until Congress can decide the future of the internet, courts are faced with making sense of an increasingly dysfunctional body of law regarding online service providers (OSPs). The freewheeling, fast evolving nature of the internet has facilitated significant contradictions between copyright gate keeping initiatives and the FCC’s net neutrality rules. This article argues that in order to avoid dysfunctional and contradictory applications of the law, courts should avoid interpretations of copyright law that undermine the FCC’s net neutrality rules. Additionally this article will explain why the Second Circuit’s recent interpretation of the DMCA knowledge requirement on a 12(b)(6) motion should be reversed.
In 2011, the FCC’s net neutrality rules were finally printed in the federal register. Originally adopted in 2005 on a trial basis, their purpose has been to preserve internet freedom and openness and avoid most internet gate keeping by service providers. The net neutrality rules require transparency, no blocking and no unreasonable discrimination against websites (including BitTorrent) and content (including content of which there is no direct evidence the copyright holder approves of dissemination). Meanwhile, copyright cases have turned file sharing services into a pariah and have chided OSPs like YouTube for keeping a high number of copyrighted works on their networks without direct proof of copyright owner authorization. As many OSP platforms are being shaped to avoid copyright liability, FCC rules made to ensure net neutrality are needlessly being undermined. In response the Supreme Court should broadly apply three rationales to ease the friction between telecommunications and copyright law: (1) The Ninth Circuit’s statutory interpretation of the DMCA safe harbor in Shelter Capital that requires specific knowledge, (2) Judge Kozinski’s dissent in Perfect 10 v. Visa, which focuses vicarious liability on the unjust enrichment of parties facilitating copyright infringement instead of the dissemination of copyrighted works by itself, and (3) requiring plaintiffs to thoroughly prove direct infringement (i.e. applying an analysis of fair use and the idea/expression dichotomy) before allowing evidence in to prove willful blindness, volition, knowledge or an intent to encourage infringement.
The FCC most heavily regulates internet service providers (ISPs) and copyright law puts the brunt of secondary liability on OSPs, creating the appearance that the FCC is nearer to the “core” and copyright law nearer to the “edge” of internet regulation. However, because “communications” and “copyrighted content” are often one-in-the-same in an online context preparations must be made to avoid an impending clash between the two. The purpose of FCC net neutrality regulation is to protect both end users and OSPs from anticompetitive behavior that slows down innovation yet copyright law is becoming a back door to circumvent these protections. This circumvention is made possible by acquisitions and exclusive transfers of IP rights, with OSPs, ISPs and content owners being affiliated or under common ownership. For example, the ISP Comcast owns as subsidiaries both NBC and Xfinity. It is therefore in Comcast’s interest to use NBC’s copyright portfolio to shape the online playing field in Xfinity’s favor. Another example is Google/YouTube’s deal with Comcast/NBC for being the exclusive online provider for the 2012 summer Olympics. Because of their agreement, an online viewer had to purchase an unrelated cable subscription in order to watch the Olympics online. In this scenario, Comcast was able to hire YouTube as a mercenary through copyright licensing to carry out anticompetitive behavior that would have attracted FCC antitrust scrutiny had they simply required the purchase of an unrelated cable subscription themselves. In this way copyright law may be used as a back door for ISPs to circumvent FCC regulation if they create, purchase or enter into exclusive contracts with an OSP. Copyright law is being shaped into a leveraging mechanism to justify anticompetitive behavior and circumvent FCC regulation that would otherwise stop the internet from being molded by the interests of massive corporations and used against the public interest.
Keywords: SOPA, PIPA, ACTA, Sony, Copyright, Secondary Liability, torrent, file sharing
Suggested Citation: Suggested Citation
Schroeder, Joshua J., Choosing an Internet Shaped by Freedom: A Legal Rationale to Rein in Copyright Gate Keeping (October 8, 2012). 2 Berkeley Journal of Entertainment and Sports Law (2013). Available at SSRN: https://ssrn.com/abstract=2364925
By Peter Yu