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The ADA Monthly Intellectual Property
Wrap-Up
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A monthly summary of recent legislation, cases, reports and other events
relating to intellectual property and the public interest, published by the
Australian Digital Alliance.
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May
2003
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[1] About this Publication
[2] DVD Copyright Software Under
Attack
[3] Disney: "This DVD will self destruct..."
[4] Jurisdiction and
the Prickly Problem of Internet Publishing
[5] DVD CCA v Bunner
[6] I
can copy this, right?
[1] About this publication
This
summary of recent IP (but chiefly copyright) happenings of relevance to
Australia is published every month by email and on the Australian Digital
Alliance website at http://www.digital.org.au/issue/issue.htm. If you have any
suggestions as to what should go in the next issue, please let Miranda Lee know
by email: (mlee@nla.gov.au).
Nothing in this publication constitutes legal advice.
[2] DVD copying
software under attack (again)
A San Francisco court is to hand down
judgment in a yet another clash between technology groups and copyright holders
over the issue of circumvention devices.
Action against 321 Studios was
taken in mid May by seven major film companies to stop the software company
from selling its DVD X-Copy and DVD Copy Plus program which enables
unscrambling of copy protection devices. The film companies claimed that the
software violates the controversial DMCA provisions banning the sale of
products, which circumvent copyright protection measures. In response, 321
contended that consumers should be allowed to circumvent protection measures
for certain purposes, such as to make a back up copy of a legitimately bought
DVD.
Most DVDs currently on the market contain embedded anti copying
protection, and although there have been a small number of cases that centre
around the circumvention provisions in the DMCA, this case will be a thorny one
as it directly asks the court to answer the question of whether consumers have
a right to circumvent copy protection devices in some cases or whether the act
of circumvention is banned in all cases.
The position of the film
companies (which include TriStar Pictures, Columbia Pictures, Time Warner and
Disney) is that the act of circumvention is illegal irrespective of end
purposes. On the other hand, 321 argued that the fair use exceptions should not
be overridden by the circumvention provisions of the DMCA. The prohibition on
fair use practice of excerpting by film reviewers was discussed as an example
of the way that circumvention devices may incidentally prevent free speech.
321's arguments called for a limited interpretation of the DMCA in order to
maintain the ability to engage in fair use in a digital environment.
Discussion also took place over the issue of public domain and the
effects of circumvention devices on the practical copyright term of
works.
The judge considered the decisions of previous cases dealing
with circumvention devices and digital copyright, notably ElcomsSoft and
the DeCss case (a 2002 decision banning a Web publisher 2600, a hacker
e-magazine, from posting or linking to DeCss, that could be used to crack DVD
encryption).
Although the Judge has not yet handed down judgement, she
indicated that she was "substantially persuaded" by the past court rulings that
favoured copyright holders.
The judgment is expected in
June.
[3] Disney "The DVD will self destruct….."
Disney will trial a new self-destructing DVD in the US market in
August. The new DVDs being piloted will allow buyers to view the material on
the DVD for 48 hours before a chemical is released in the disc that will make
the DVD unreadable. The process has been described as similar to rusting; when
the DVD is removed from its packaging the disc is red and as the disc is
exposed to oxygen, it darkens to a black colour to become unreadable on DVD
machines. The life of the DVD will not be able to be extended by the tech
enthusiasts as the process is chemical rather than technological.
The
DVD will be priced slightly higher than normal rental DVDs for the convenience
of not having to return the video to the store and has been introduced by
Disney as a way to maintain revenue streams in the strong home video/DVD market
which has remained stable for Disney when other branches of the empire such as
its theme parks, toys and theatrical release films have been flagging. The DVDs
will allow Disney to expand its DVDs marketing to more areas, given that the
discs, after 48 hours are useless and do not have to be returned to the store.
[4] Jurisdiction and the Prickly Problem of the Internet
Publishing
The issue of jurisdiction over the
internet keeps on turning out uneven results.
The North Dakota Supreme
Court has affirmed a $3million libel judgment from the district court in a case
involving internet jurisdiction issues. Prior to the beginning of the action,
the defendant student was expelled from the University of North Dakota for
allegedly using the university's e-mail system to email her physics professor
harassing and sexually explicit messages. The ex-student subsequently moved
interstate and launched a website that primarily contained news about the
university and its staff. The professor followed with a lawsuit against the
former student, alleging that slanderous statements posted on her Web site had
interfered with his business relationships. A jury awarded him $3 million and
the district court upheld the verdict.
One of the primary points of
contention in the case was whether the court had jurisdiction over
non-residents whose alleged crime took place over the internet. In coming to
the decision, the court considered a number of cases that had dealt with the
issue (setting differing standards for assessing appropriateness of asserting
jurisdiction). Amongst them the "sliding scale" test that was adopted in
Zippo v Zippo.com which asserts jurisdiction according to the level of
interactivity of a website and also Calder v. Jones which applied the
"effects test". The effects test entails an examination of whether the internet
activity was targeted to the forum state. In Calder, a California
resident sued a Florida-based author of a National Enquirer article, as
well as the magazine, for libel. The court there asserted jurisdiction because
of the foreseeable "effects" in California of the non-resident defendants'
activities as the alleged harm and injury to reputation would occur in
California.
Citing the similarity of Calder, the court in the
current North Dakota case adopted the "effects test". Given that the website
contained linked articles (about the plaintiff, his trial attorney and the
litigation) that related to university issues and staff, the court found that
the student did particularly and directly target North Dakota with her website.
Jurisdiction over the matter was asserted by the court who upheld the lower
court's judgement.
The decision can be found
here
In another part of the United States, the U.S. Supreme Court has
refused to hear a case over Internet libel, letting stand an appeals court's
ruling that two Connecticut newspapers could not be sued in a Virginia court
over allegedly defamatory material that appeared on their websites. In that
case, Young v. New Haven Advocate, a prison warden in Virginia sued over
news articles that criticized a prison in Virginia.
There exists no
national standard in the US (or any other part of the world) for whether
someone can be sued in another state for comments made online. A myriad of
different decisions have been tabled although the "effects" test of
Calder seems to oft cited and most likely to be adopted. The issue is
also unsettled on an international level; there have not been a large number of
cases although the decision of the Australian High Court in Gutnick has been
cited as a decision raising concern amongst for internet
publishers.
[5] DVD CCA v. Bunner
California's High Court
heard arguments in late May in the DVD CCA (DVD Copy Control Association) v.
Bunner DeCSS case. The court is considering whether a ban on the posting of
DeCSS code, which cracks the content-scrambling system designed to protect DVD
movies, violates free speech.
The case, DVD CCA v. Bunner, began a few
years ago, when the DVD CCA sued Andrew Bunner (and others) for allegedly
violating California trade-secret laws by displaying links to the code. A trial
court in California, granted an injunction banning the posting of the code, but
Bunner appealed, saying the injunction violated his free speech rights. The
Sixth District Court of Appeals in San Jose, California, agreed with Bunner and
reversed that injunction, so the DVD CCA appealed to the California Supreme
Court.
As the DeCSS is already widely distributed on the Internet the
issue of whether the code deserved a strict standard was discussed. Bunner had
put the code on his site after reading about it on Slashdot and wasn't involved
in creating DeCSS or originally posting the code to the Web; Bunner's lawyer's
contended that to allow the ban was essentially to stop the flow of information
by banning posting of the code by people who are unrelated to the case. The
lawyer for Bunner also said the trial court, in granting the injunction, failed
to consider that the ban violated Bunner's free speech rights.
This
case differs slightly from MPAA v 2600 (2002) where the US federal
courts have already said Web publishers who post DeCSS are in violation of the
DMCA. Here DVD CCA is suing Bunner and others under the pretense of state
"trade-secret" laws but the at heart, the issue is the same; both cases are
about the conflict between fair use and control of copyright material. The
repercussions of a decision against Bunner will make it more difficult for
people to reverse-engineer things since many software developers depend on
decryption programs like DeCSS to learn about the inner workings of certain
programs and to make compatible products. Predictably, DVD CCA argues that the
code is a burglary tool used to facilitate the "piracy" of movies, currently
undermining the market of the film industry.
Other parts of this case
raised the jurisdictional question of whether the DVD-CCA could sue
out-of-state residents in California. In a similar case Pavlovich v DVD CCA
(2003) brought by the DVD CCA against one-time Purdue University student
and current Texas resident Matthew Pavlovich, the same court that is hearing
the Bunner case asserted that California courts did not have jurisdiction,
because Pavlovich had no ties to the state.
The decision is expected in
the next month or so.
[7] I can copy, right?
Yes, you
can copy this publication. Feel free to send it to friends or colleagues, print
it off or even archive it on your website provided that all text is included
or, in the case of an excerpt, appropriate credit is given.
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