Monetizing Infringement

Abstract

The deterrence of copyright infringement and the evils of piracy have long been an axiomatic focus of both legislators and scholars. The conventional view is that infringement must be curbed and/or punished in order for copyright to fulfill its purported goals of incentivizing creation and ensuring access to works. This Essay proves this view false by demonstrating that some rightsholders don’t merely tolerate, but actually encourage infringement, both explicitly and implicitly, in a variety of different situations and for one common reason: they benefit from it. Rightsholders’ ability to monetize infringement destabilizes long-held but problematic assumptions about both rightsholder preferences, and about copyright’s optimal infringement policy.

Through a series of case studies, this Essay describes the impetuses and normative implications of this counterintuitive—but not so unusual—phenomenon. Recognition of monetized infringement in copyright is interesting not only for its unexpectedness, but also for the broader point that its existence suggests: we have an impoverished descriptive account of why some laws operate the way that they do. This is particularly unsettling in an area like copyright, where advocates are sharply divided along policy lines. This Essay is an important first step toward a positive theory of copyright—one that recognizes the underappreciated role, both positive and negative, that private parties play in policymaking.

Keywords: copyright, intellectual property, law and economics, infringement

JEL Classification: K00, K10, K11