July 24, 2004

S.2560 (IICA/INDUCE Act) and "substantial noninfringing use"

During the recent IICA/INDUCE Act hearing, there was much discussion about the "Sony" standard concerning the copyright defense for product-makers of having substantial non-infringing use. For example, Senator Hatch stated:

Second, S. 2560 uses a proven model for structuring secondary liability. The substantial-noninfringing-use rule that Sony imported from the Patent Act coexists there alongside liability for intent to induce infringement [,] a concept that the Patent Act calls active inducement. This proven model can address cases of intent to induce infringement that were explicitly not covered or addressed by the Supreme Court in Sony.

In the above quote, I assume he means the following S.2560 paragraph:

`(3) Nothing in this subsection shall enlarge or diminish the doctrines of vicarious and contributory liability for copyright infringement or require any court to unjustly withhold or impose any secondary liability for copyright infringement.'.

However, I believe the recent history of such claims provides a substantive argument that he is mistaken. Remember, we've been here before, with the DMCA, in the infamous 1201(c)(1) passage (emphasis added):

* (c) Other Rights, Etc., Not Affected. -

(1) Nothing in this section shall affect rights, remedies, limitations, or defenses to copyright infringement, including fair use, under this title.

The INDUCE Act may preserve the "substantial non-infringing use" standard of _Sony_, in the same way the DMCA preserved fair-use: only as a very abstract theory, not in practice.

Let's recall what the DeCSS case ruled:

When Sony was decided, the only question was whether the manufacturers could be held liable for infringement by those who purchased equipment from them in circumstances in which there were many noninfringing uses for their equipment. But that is not the question now before this Court. The question here is whether the possibility of noninfringing fair use by someone who gains access to a protected copyrighted work through a circumvention technology distributed by the defendants saves the defendants from liability under Section 1201. But nothing in Section 1201 so suggests. By prohibiting the provision of circumvention technology, the DMCA fundamentally altered the landscape. A given device or piece of technology might have "a substantial noninfringing use, and hence be immune from attack under Sony's construction of the Copyright Act--but nonetheless still be subject to suppression under Section 1201." [FN169] Indeed, Congress explicitly noted that Section 1201 does not incorporate Sony. [FN170]

That is, the line with the DMCA, is that you're not being charged with the old infringement offense, to which one can defend via fair use. You're being charged under the all-new circumvention offense, which doesn't have that defense. But the old defense isn't affected, since if you were changed with the old offense, you could still plead that, got it? (I call this a "legal hack").

So, I think in any case under the IICA/INDUCE Act, we'd get a similar line: _Sony_ standard ("substantial-noninfringing-use")? What _Sony_ standard? That's a defense to "vicarious and contributory liability". You're not being charged with "vicarious and contributory liability". You're being charged with the brand-new INDUCTION liability. But if you were charged with "vicarious and contributory liability", you'd have a great defense under the _Sony_ standard, you betcha. But how sad for you, that you're being charged for inducing-infringement, for which that defense doesn't exist. After all, the whole reason for the new law was to create a new offense for conduct just like you're being charged with, got it?

Having seen this happen so recently, it's quite reasonable to believe it'll happen again.

By Seth Finkelstein | posted in copyblight , legal | on July 24, 2004 12:46 PM (Infothought permalink) | Followups
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I have to say that this bill is the most stupid thing i have seen in a very very long time. Will they manage to put it through? I hope not! They put this bill through....what else can they do after?

Help Desk Software

Posted by: ITIL at July 26, 2004 09:05 AM

"The effect on device manufacturers, including computer manufacturers, would appear to be self-evident: They could not bring new multi-purpose devices (including software) to market without facing the threat of crippling litigation."

While this allows a "direct" regulation of consumer electronics by hollywood, and severely hinders flexible general purpose technology, the DMCA indirectly does the same thing. Any time Hollywood or the RIAA want to prevent technological innovators from adapting their devices to interact with the content they make in a fair non-infringing manner, they can just put any form of DRM on it and sue anyone who makes a program capable of cutting through it for any reason.

These interests have found a new way to trick congress and the american people by splitting the implementation of their unfair agendas between congress and other private or regulatory bodies.

I like to term this tactic "half laws", because they figure out what they want to do, ask congress to get them half way there, then use someone else to fulfill the rest.

EX. first the DMCA to make it illegal to circumvent DRM, then the "Plug and Play" standards to assure the consumer is not given the choice of something without DRM . Presto , instant regulation of consumer electronics !

Posted by: Alexander Wehr at August 9, 2004 10:28 AM