RIAA wants DCMA clarity from Congress

The USA’s The Digital Millennium Copyright Act (DCMA) has been criticised by many for being slanted far too much in favour of content providers, with the underlying suspicion that film, television, publishing and recording companies were effective in influencing the passage of the Bill. But now the Recording Industry Association of America is taking issue with the DCMA – or rather the US Court’s interpretation of the legislation - saying judges are far too favourable to Internet Service Providers, websites and even consumers. Jennifer Pariser, the RIAA’s litigation chief, told a US law conference:

"I think Congress got it right, but I think the courts are getting it wrong," adding "I think the courts are interpreting Congress' statute in a manner that is entirely too restrictive of content owners' rights and too open to [Internet] service providers.

"We might need to go to Congress at some point for a fix," Pariser added. "Not because the statute was badly drafted but because the interpretation has been so hamstrung by court decisions."

RIAA President Cary Sherman complained that the DMCA “isn’t working for content people at all” saying “You cannot monitor all the infringements on the Internet. It’s simply not possible” adding “We don’t have the ability to search all the places infringing content appears, such as cyberlockers like [file-hosting firm] RapidShare.”

At the heart of this is the provision in the DCMA that offers the so called “safe-harbour” protection to some technology providers, and in particular promotes the principle that content-sharing services like YouTube cannot be liable for copyright infringement by their users, even if they inadvertently host infringing content, providing the service has an effective ‘take down’ a system in place by which a content owner can remove infringing material.

For some time now, the RIAA has been pushing ISPs to start policing their users. “We’re working on [discussions with broadband providers], and we’d like to extend that kind of relationship–not just to ISPs, but [also to] search engines, payment processors, advertisers,” Sherman has said. Clearly the RIAA is frustrated by the perceived low threshold needed to fall under safe harbour protection and now wants the US government to refine and define what should and shouldn’t fall under safe harbour. The recent US decisions in Viacom v YouTube, MP3Tunes v EMI and the ability of services such as Grooveshark to fall under safe harbour provisions are clearly a major irritation for the record labels as I imagine was the recent decision in Germany which held that net firm HanseNet was not liable for the actions of its customers in accessing the Russian ‘E-Donkey’ illegal file swapping services.

Every coin has another side and some commentators feel that the content industries were hoodwinked by the DCMA which is actually more favourable to the technology sector, websites and internet service providers. And many point to the importance of safe harbour provisions in allowing small service operators and websites from having to spend time and money patrolling for infringing material posted by their users. Even the big boys agree and Lance Kavanaugh, You Tube’s product counsel, said “It’s our view that the DMCA is functioning exactly the way Congress intended it to ..... Congress was prescient. They struck the right balance”

The whole question of the extent of the liabililities of intermediaries is being tested around the World. In the UK the recent Newzbin 2 decision was a major triumph for content owners, and they are hoping for a similar result in Australia in the iiNet litigation – now on its second appeal. In the L’Oreal v Ebay case (2011) the European Court of Justice (looking primarily at trade mark issues) decided that a service provider such as eBay could be liable for users infringements under national law, unless it can rely on an exemption from liability provided by Directive 2000/31 on electronic commerce but explaining that the exemption would be subject to the following conditions being met: (i) the operator does not play an active role, i.e., it does not know or control the data provided by its customers; (ii) a diligent economic operator would not have realised that the online offers for sale were unlawful; and (iii) the operator must not have failed to act promptly to remove offers of counterfeiting goods from its website or to disable access to such offers.


http://www.techdirt.com/articles/20111108/00352916675/riaa-admits-it-wants-dmca-overhaul-blames-judges-wrong-interpretation.shtml

Capitol Records, Inc. et al v MP3Tunes LLC et all (2011) No 07 Civ 9931 (“EMI v MP3Tunes”)

Twentieth Century Fox Film Corp & Others v British Telecommunications Plc [2011] EWHC 1981 (Ch) (“NEWZBIN 2”)

Roadshow Films Pty Limited v iiNet Limited [2011] FCAFC 23 (“IINET”)

Viacom International, Inc. v. YouTube, Inc., No. 07 Civ. 2103,

Terminal blues for the record labels?

There has been a lot of excitement in cyberworld as the US press wakes up to the rather interesting idea that an ever growing list of major recording artistes and songwriters are looking to reclaim their copyrights from record labels and music publishers.



The New York Times focussed on a number of 1978 hit albums such as Bruce Springsteen’s “Darkness on the Edge of Town,” Billy Joel’s “52nd Street,” the Doobie Brothers’ “Minute by Minute,” Kenny Rogers’s “Gambler” and Funkadelic’s “One Nation Under a Groove” which of course have generated tens of millions of dollars in sales for record companies and music publishers alike. Why the story then? Well thanks to "a little-noted provision in United States copyright law, those artists — and thousands more — now have the right to reclaim ownership of their recordings, potentially leaving the labels and music publishers out in the cold". And the list nas grown and currently includes Bryan Adams, Bob Dylans, Tom Waites, Kris Kristofferson, Kool & The Gang, Fleetwood Mac and now Victor Willis, frontman and songwriter with the Village People (he was the naval officer!) who is seeking to regain control of over thirty of the band’s hits including Y.M.C.A, from two music publishing companies who are contesting the move.



The background to this is the revision to US copyright laws in the mid-1970s, when musicians and songwriters, like creators of other works of art, were granted “termination rights,” which allow them to regain control of their work after 35 years, so long as they apply at least two years in advance. Recordings from 1978 are the first to fall under the law, but in a matter of months, hits from 1979, like “The Long Run” by the Eagles and “Bad Girls” by Donna Summer, will be in the same situation — and then, as the calendar advances, every other master recording once it reaches the 35-year mark. But don't expect the music industry to just hand over the rights! The Recording Industry Association of America have issued a statement saying with General Counsel Stephen Marks saying "We believe the termination right doesn't apply to most sound recordings." The labels are preparing to argue that the albums they released were "works for hire," that musicians were effectively employees and the fruits of their labors always belonged to the companies saying We believe the termination right doesn’t apply to most sound recordings,” said Steven Marks, general counsel for the Recording Industry Association of America. As the record companies see it, the master recordings belong to them in perpetuity, rather than to the artists who wrote and recorded the songs, because, the labels argue, the records are “works for hire,” compilations created not by independent performers but by musicians who are, in essence, their employees.



http://www.nytimes.com/2011/08/16/arts/music/springsteen-and-others-soon-eligible-to-recover-song-rights.html?_r=1





http://www.nytimes.com/2011/08/17/arts/music/village-people-singer-claims-rights-to-ymca.html?_r=1 (A Village Person Tests The Copyright Law)



http://www.perthnow.com.au/business/media-marketing/music-legends-reclaiming-recordings/story-e6frg2rc-1226116806582



http://www.techdirt.com/articles/20110816/09574115549/dear-musicians-riaa-is-about-to-totally-screw-you-over-again.shtml

US content industry and ISPs to inform and alert

After months of discussions, a large number of the major U.S. Internet service providers (ISPs) have signed up to an agreement to take action against users who violate copyright. AT&T, Cablevision Systems, Comcast, Time Warner and Verizon have agreed to participate in the scheme along with a number of content providers from the film, TV and music industry including the MPAA (The Motion Picture Association of America whose members include Disney, Sony, Paramount, Warner Bros and Twentieth Century Fox), the Recording Industry Association of America (representing the major labels including Universal, EMI North America, Warners and Sony) , the IFTA (representing independent producers & distributors of film & television programming) and A2IM which represents independent record labels.

The voluntary “Memorandum of Understanding” is based on a system of Copyright Alerts, “a state-of-the-art system similar to credit card fraud alerts – that will educate and notify Internet subscribers when their Internet service accounts possibly are being misused for online content theft. This voluntary landmark collaboration will educate subscribers about content theft on their Internet accounts benefits consumers and copyright holders alike.”

The approach is intended to overcome one of the major arguments against disconnecting accounts that are being used for piracy, which is that often the person who pays the bill is unaware that illegal activity is occurring. In other cases, the accused infringer is unaware of the applicable copyright laws, or may be unaware that downloading copyrighted content from illicit sources is illegal and violates ISP’s terms of service. The Copyright Alert System is based on a consumer’s “right to know” when his or her Internet account may have been used improperly to download copyrighted content. The RIAA’s press release says that the new system addresses these problems with a series of early email alerts (up to six) notifying the subscriber that his or her account may have been misused to access illegal for online. It will also put in place a system of “mitigation measures” intended to stop online content theft on those accounts that appear persistently to fail to respond to repeated Copyright Alerts. The system will also provide subscribers the opportunity for an independent review to determine whether a consumer’s online activity in question is lawful or if their account was identified in error (there will be a small charge of $35 for this).

However, termination of a subscriber’s account is not part of this agreement. ISPs will not provide their subscribers' names to rights’ holders under this agreement although the new system of graduated Copyright Alerts means that consumers will have more advance warning and educational opportunities before extreme penalties are implemented. This will replace the current practice of DMCA violation notices being sent to the ISP, who then forwards them to the account holder.

The agreement also establishes a Center for Copyright Information to support implementation of the system and educate consumers about the importance of copyright.

Comment from the ISPs seems limited with Randal S.Milch, executive vice president and general counsel of Verizon saying “This is a sensible approach to the problem of online-content theft and, importantly, one that respects the privacy and rights of our subscribers”

Comment from the content industries was widespread (and rather verbose in places). Both Michael O’Leary, Executive Vice President for Government Relations at the MPAA and Cary Sherman, president of the RIAA said that piracy put the jobs of many creative industry workers at risk, and that the provisions of the new Agreement would lead consumers to discover the multitude of content now legitimately available online with O’Leary saying “Many people don’t realize that content theft puts jobs – and future productions of films, TV shows, music, and other content – at risk …. today, there are more ways to enjoy content legitimately online than ever before. This agreement will help direct consumers to legal platforms rather than illicit sites, which often funnel profits to criminals rather than the artists and technicians whose hard work makes movies, television, and music possible.”

James Assey, executive vice president of the National Cable & Telecommunications Association (NCTA) said “Consumers have a right to know if their broadband account is being used for illegal online content theft, or if their own online activity infringes on copyright rules – inadvertently or otherwise – so that they can correct that activity” adding “We are confident that, once informed that content theft is taking place on their accounts, the great majority of broadband subscribers will take steps to stop it. That’s why the educational nature of this initiative is so critical.” The International Federation of Phonographic Industries, representing the recording industry worldwide welcomed the agreement and the IFPI’s Chief Executive Officer, Frances Moore, said “It is very good news that ISPs in the US recognise their pivotal role in tackling online piracy and have committed to take proactive steps to achieve this. The agreement also sends an important signal internationally. It adds to the momentum already created by initiatives such as graduated response and blocking of infringing websites in other countries, and is the latest mark of recognition that ISP cooperation is the most effective way of addressing online piracy.”

A word of caution came from The Center for Democracy & Technology and Public Knowledge said the agreement met many but not all of their concerns regarding the rights of the average citizen, and that “close ongoing scrutiny will be required to ensure that the agreement achieves its purpose without unfair or disproportionate consequences for Internet users.”

Both the Center for Copyright Information and the Copyright Alert System are voluntary collaborations between the entertainment and broadband business communities. Participating ISPs will begin implementing Copyright Alerts in 2011 and 2012.

http://riaa.com/newsitem.php?content_selector=newsandviews&news_month_filter=7&news_year_filter=2011&id=2DDC3887-A4D5-8D41-649D-6E4F7C5225A5

LimeWire settles with record labels for $105 million

LimeWire, the now defunct file sharing platform, and its founder, Mark Gorton, have reached a settlement with the 13 record labels that brought an action against them in the Manhatten federal court, agreeing to pay $105 million in damages. The defendants has already been found liable for copyright infringement last year by Judge Kimba Wood and the trial that has been settled was to award damages – the Jury could have potentially awarded up to $1.4 billion in statutory damages. LimeWire had already settled an action brought by 30 music publishers in March 2011.

Glenn Pomerantz, the lawyer representing 13 record labels in their legal action in the Manhatten federal court against Lime Wire LLC and founder Mark Gorton, said at the start of the action that the defendants should pay the highest range of damages for harming the recording industry by allowing people to download songs for free saying “The harm that Lime Wire has caused is truly staggering,”

The record companies also accused Gorton of the fraudulent transfer of assets into family limited partnerships where they would be shielded from liability. Gorton, who was CEO of Limewire from 2000 to 2006, was found by the court to have been intimately involved with the management of the company and until 2005, Gorton owned at least 87% of the company, according to court records. Pomerantz told the jurors Gorton made the transfer three days after the U.S. Supreme Court ruled in 2005 that file-sharing service Grokster could be held liable for copyright infringement in the MGM v Grokster case. In a pre-trial ruling Judge Kimba Wood said that Gorton and all his business entities (such as Lime Group and Lime Wire FLP) could be liable for copyright infringement, so that he himself and any other companies he set up will also be liable to pay any damages awarded to the rights owners.

The record labels evidence all pointed to LimeWire’s role is facilitating illegal downloading and the resultant destruction of the recorded music market. In opening remarks Pomerantz told the jury the record industry’s revenue declined 52% from 2000 (the year Lime Wire was founded) to 2010. Gorton and LimeWire’s lawyers have, unsurprisingly, a slightly different take on this, arguing that many other factors were responsible for the drop in music industry revenue besides peer-to-peer file sharing, with the defendant’s attorney Joseph Baio saying “The record companies know and have known that their problems started well before Lime Wire” in his opening remarks. Baio cited the record companies’ own past comments to show that other factors were more to blame for the decrease in revenue than file-sharing. These included counterfeit and copied CDs, the economic recession, bankruptcies of music wholesalers and retailers, the maturation of the CD market, competition from other forms of entertainment such as video games, and the industry’s own inability to exploit the new technologies.

The defendants were hampered by another of Judge Wood’s rulings when she said that one of their key witnesses, a damages expert called George Strong, would not be allowed to deliver his entire testimony. Strong planned to tell the court that the link between file-sharing and slumping record sales in the last ten years was not proven, and that there is evidence that file-sharing can lead to an increase in record sales, ie the 'file-sharing is basically a preview service' argument. However Wood ruled that Strong was not an expert on either the music or technology industries, and that as he hadn't undertaken any of his own research regarding file-sharing, he would not be allowed to make such sweeping statements in court with Judge Wood saying ”He can’t argue that file sharing may have stimulated additional music purchases, because he didn’t do any analysis in that area”. Judge Wood has also indicated that she wouldn't allow evidence from recording artistes who would say that illegal file swapping has not harmed their careers – and in some cases may have (in their opinion) helped their careers. Judge Wood was happier with the record companies’ experts and Dr. Richard Waterman of the University of Pennsylvania, who ran a study which concluded that 98.8% of the files requested by Limewire users were copyright protected, would have been allowed to give evidence.

As the trial progressed the defence did produce a number of statements in court from various record label executives to explain the rise of filesharing and point towards the label’s own failures to contain piracy. One internal memorandum produced to the court by the defence from Warner Music Group chief Edgar Bronfman Jr, saying “"[W]e inadvertently went to war with consumers ... [and] consumers won," Doug Morris, former head of Universal Music wrote in a note presented as evidence "The real problem is that there is no technology coming from the record companies" with current Universal Music CEO Zach Horowitz also quoted: It seems when told by Victory Records CEO Tony Brummel, "You can't compete with free," Horowitz replied "We can. We have to. It's just that we have to be creative and add value" although I am not quite sure why the defence felt this helped their case. LimeWire also produced a memo from Recording Industry Association of America (RIAA) chairman Mitch Bainwol, entitled, "Burning and Ripping are Becoming a Greater Threat Than P2P" – again I am not quite sure why this helped the defence - its all piracy and all damaging! LimeWire's attorney concluded his opening statement in the case by pointing out that anytime a file-sharing network has been shuttered, users have migrated to another service. CNET reports Baio concluded by saying "Music that is free is here to stay".

Next it was LimeWire founder Mark Gorton’s turn to give evidence. Noting last year's court ruling on his company's operations, Gorton told the court "I was wrong. I didn't think our behaviour was inducing [copyright infringement] but I understand that a court has found otherwise". The RIAA clearly have a different opinion and said that Gorton ploughed ahead (despite a cease and desist letter sent after Grokster) because of the potential profits he could make - even more so once most of his US competitors shut down post Grokster. Indeed Pomerantz highlighted a pre-Grokster interview Gorton gave to the New York Times in which he said: "If the Supreme Court says it is illegal to produce this software, LimeWire will cease to exist" and also noted that LimeWire staff divided up their users into four categories: “hardcore pirates” (25%), “morally persuadable” (25%), those “sampling music” (30%) and “legally unaware” (20%). Pomerantz also said that Gorton had banned his staff from responding to user queries regarding the service's legality. Gorton told the court that he took the cease and desist letter as a request by the labels that he find a way of persuading his users to pay for music, and that he forbade staff discussing LimeWire’s legality as hadn't wanted to be placed in a position of giving legal advice to internet users.

And then it was time for the first of the record industry heavyweights – with Warner Music Group Chief Executive Officer Edgar Bronfman telling the federal jury that Lime Wire’s effect on Warner’s business was “devastating.” Bronfman, 54, testified that the drop in revenue caused by peer-to-peer music sharing services such as Lime Wire forced Warner to fire employees and release fewer recordings. He said he had hoped the services would shut down voluntarily after the Supreme Court Grokster decision held that music-sharing programmes could be held liable for infringement. “When Lime Wire kept operating it frustrated me greatly,” adding “It was devastating, frankly.” And that was the last of the heavyweights too as .... and the case was suddenly announced as settled, with the first report I saw in the Wall Street Journal, based on a defence statement to the press.

With a week of the trial still scheduled, and with no public indication from the record labels about how much they were seeking, media reports were still speculating that it would be maximum statutory damages (under federal copyright law) for 9,561 sound recordings released since 1972. If the jury awarded maximum statutory damages of $150,000 for each recording, that would result in an award of $1.4 billion. Other damages on pre-1972 recordings were also being sought. In my own opinion the record labels had made a good case – and of course had already won the argument about whether or not LimeWire was liable for infringement - but clearly LimeWire alone was not the reason for the decline in the sale of recorded music – there are many reasons – piracy and P2P file swapping being key factors of course – but the record labels failure to adapt to the digital age is as much to blame in my mind (and yes, I still remember the awful Pressplay and Music Net the labels launched which is another story altogether). That said, much of the defence was, at best, irrelevant and some seemingly self defeating. Baio had said the labels deserved far less and seemingly said that Gorton made ‘only’ about $6 million from the songs the record companies have listed as infringed. What did become clear was that as the case developed, ongoing settlement talks had run parallel with case with the Wall Street Journal again reporting that lawyers for the labels and LimeWire representatives have met on at least three occasions in the hope of replacing the jury decision. And then on May 12th the WSJ reported that a settlement HAD been reached with LimeWire LLC and its founder, Mark Gorton, agreeing to pay the (major record labels) plantiffs and their trade group the Record Industry Association of America $105 million to settle the copyright infringement lawsuit, according to a statement issued by the defendants' lawyer with LimeWire and Mr. Gorton saying that they were "pleased that this case has concluded” and quite possibly very pleased that LimeWire group companies - and indeed Mr Gorton personally - were facing having to pay over less than 10% of what COULD have been awarded, and certainly a lot less than the record labels had been suggesting was the real economic damage to the recorded music market by LimeWire. That said the labels will probably be pleased that they are not reliant on an unpredictable jury, that a significant (if not ground breaking) sum of money had been recovered and another important precedent publicly set, without too much collateral damage, in a public arena.

Update: I have just found the post settlement comments from chairman and CEO of the RIAA Mitch Bainwol who told reporters: "We are pleased to have reached a large monetary settlement following the court's finding that both LimeWire and its founder Mark Gorton were personally liable for copyright infringement. LimeWire wreaked enormous damage on the music community, helping contribute to thousands of lost jobs and fewer opportunities for aspiring artists". He added: "The significant settlement underscores the Supreme Court's unanimous ruling in the Grokster case: designing and operating services to profit from the theft of the world's greatest music comes with a stiff price".

What remains is one now defunct internet business and a declining recorded music business.



Arista Records LLC v. Lime Wire LLC, [2011] 06-05936, U.S. District Court, Southern District of New York (Manhattan).

EMI April Music Inc et al v. Lime Wire LLC, [2011] U.S. District Court, Southern District of New York, No. 10-04695.


www.thecmuwebsite.com (CMU Daily, 5th May 2011)

http://www.bloomberg.com/news/2011-05-04/lime-wire-jury-chosen-as-warner-music-sony-labels-seek-copyright-damages.html

http://paidcontent.org/article/419-limewire-trial-beginsjury-to-decide-how-much-labels-are-owed/

http://news.cnet.com/8301-31001_3-20061209-261.html

(over the) Pond Life

The U.S. government has seized control of dozens of websites it says are offering unauthorized copyrighted or counterfeit content. The Department of Homeland Security's Immigration and Customs Enforcement (ICE) division took over 82 domains including Torrent-Finder.com, RapGodFathers.com, DVDProStore.com, Cartoon77.com, NFLJerseySupply.com and Handbag.com. The seizure orders come from courts in eight states and take place shortly after a U.S. Senate Committee approved the Combating Online Infringement and Counterfeits Act (COICA), which aims to empower the Justice Department to use tactics similar to those just employed by Homeland Security and ICE.

Wired.com report that EMI Records has asked the federal judge overseeing the label's copyright infringement lawsuit against music locker service MP3tunes to bar digital civil liberties group the Electronic Frontier Foundation (EFF) from submitting a "friend of the court" brief in the case saying that the EFF brief is "a pure advocacy piece, not a 'friend of the court," and also that the brief is "duplicative," "contains unsupported speculation," and exceeds the court's page length restriction. EMI also argues that, should EFF's brief be allowed, parties supporting EMI's position should be allowed to submit additional briefs.

TorrentFreak reports that the US Copyright Group, which has filed copyright infringement lawsuits against tens of thousands of internet users who have allegedly illegally downloaded movies such as "Far Cry" has been hit with a class action lawsuit by over 4,500 of those sued. The retaliatory class action lawsuit alleges "extortion, fraudulent omissions, mail fraud, wire fraud, computer fraud and abuse, racketeering, fraud upon the court, abuse of process, fraud on the Copyright Office, copyright misuse, unjust enrichment and consumer protection violations" and says that the offences were committed by US Copyright Group in its efforts to extract settlement fees from alleged file-swappers. The claim also says that the producers of "Far Cry" did not secure a copyright registration for the film until after it began collecting information on peer-to-peer traffic, and argues that this fact invalidates any earlier claims of infringement.

In case you missed it, there is a war of words going on over in the USA all about a letter sent to PC Mag by the major record labels and other music industry trade groups in response to a PC Mag story about the demise of Limewire, which the labels say was promoting unauthorized copyright infringement by naming alternatives to the now defunct Limewire. Apart from the fact it seems that the original story was actually published by PC World (a competitor of PC Mag) the accusations stirred up a hornets nest, in particular over the magazine’s right of free speech with PC Mag saying “PC Mag's job is to cover all aspects of technology, which includes the products, services and activities that some groups and individuals might deem objectionable. We covered these Limewire alternatives because we knew they would be of interest to our readers. We understand that some might use them to illegally download content. We cannot encourage that action, but also cannot stop it. Reporting on the existence of these services does neither.” Not content with that, the letter goes on to say “It worries me that the music industry took this action, because it reeks of desperation. The RIAA and other music industry organizations have spent the better part of the decade fighting the digital transition, with only a shrinking business to show for it. In recent years, though, the fist of anger has turned into at least one open hand as the music industry embraces the once shunned digital music industry. Unfortunately, that warm embrace, and the change that comes with it, are not happening fast enough. Clearly the music industry is still losing money to music piracy and even the recalibrated profit margins brought on by legal music sharing services. It's time for these music execs to pull their collective heads out of the sand and fully acknowledge and accept all the ways their industry has changed. They also have to understand that nothing will stop technology's inexorable march forward. Things will continue to change. Music downloads and sharing will never go away. These execs have to find a way to use all that technology allows and make a business”.

A US teenager has failed in her appeal to have her damages for illegally downloading overturned because she didn’t know what she was doing was illegal. As a 16 year old Whitney Harper had used the then popular Kazaa service to download 37 tracks and she was sued by the RIAA and faced damages of $27,750.00. Harper argued that she was not aware that the file-sharing program on her computer was dealing in stolen property saying she thought the songs could be downloaded for free, just like listening to the radio on the Internet. The Supreme Court disagreed (with one judge dissenting) and upheld the 5th Circuit Court of Appeals who ruled in February that Harper could not pay a reduced minimum fine of $200 per infringed track -- instead of $750 -- as an "innocent infringer." The federal appeals court cited a provision that says infringers should know they are breaking the law since a copyright notice "appears on the published phonorecord."

Now on to Sarah Palin, who has secured much needed publicity for her new book after HarperCollins, the publisher of "America By Heart: Reflections on Family, Faith, and Flag", reached a settlement in their a lawsuit with Gawker.com. The website had published several leaked pages of the book and was ordered to take them down by a New York City judge earlier this week. "In settling the case, Gawker has agreed to keep the posted material off its website and not to post the material again in the future" HarperCollins said in an official statement.

And finally to Bradford Cox, the artist behind Deerhunter and Atlas Sound who had a rather unusual weekend after Sony Music issued a DMCA takedown notice against his blog on Friday, it seems in connection with two albums of his own bedroom-made demos which he had uploaded for his fans to download for free. This was somewhat confusing because Cox is not and has never been signed to any Sony Music label so the album's cannot be their property. Deerhunter are signed to Beggar's 4AD while Atlas Sound release via indie label Kranky according to the CMU Daily. The major has now admitted to Billboard that it had made a mistake and that it had made Cox, his manager and music server Mediafire aware of this fact. Which brings us full circle to the first story and the risks we all run when content owners are given legal powers to have allegedly infringing websites taken offline – what happens if they get it wrong?

http://www.pcworld.com/businesscenter/article/211832/courts_shut_down_82_sites_for_alleged_copyright_violations.html

www.techdirt.com

http://www.courthousenews.com/2010/11/29/32147.htm

Judge Tells LimeWire to Disable Its Software

Judge Kimba M Wood in the Federal District Court in Manhattan has issued a permanent injunction that will essentially shut down LimeWire, the music file-sharing service that has been embroiled in a four-year legal struggle with the music industry. The case has already resulted in the company and its founder being found liable for potentially hundreds of millions of dollars in damages (see More Freshly Squeezed Lime, 18th June 2010 and Squeezing the Lime Dry , 12th June 2010 on this Blog) The company says that it will continue negotiations with the major music companies in an effort to offer music legally for sale with a subscription service but in her ruling, the Judge ordered the company to disable “searching, downloading, uploading, file trading and/or file distribution functionality” of the company’s file-sharing software.

Visitors to LimeWire’s Web site were greeted with a legal notice and the text: “downloading or sharing copyrighted content without authorization is illegal.” In a statement the Recording Industry Association of America, the music industry’s trade group that had led the legal action, said: “For the better part of the last decade, LimeWire and [founder Mark] Gorton have violated the law. The court has now signed an injunction that will start to unwind the massive piracy machine that LimeWire and Gorton used to enrich themselves immensely.” In May, Judge Wood ruled that the company had violated copyright law and was liable for damages. The court is scheduled to decide early next year the amount the company and Mr. Gorton will be forced to pay. “In January, the court will conduct a trial to determine the appropriate level of damages necessary to compensate the record companies for the billions and billions of illegal downloads that occurred through the LimeWire system,” the RIAA said in its statement. Music publishers have brought a separate action led by EMI Music.

http://www.nytimes.com/2010/10/27/technology/27limewire.html?_r=1 http://www.computerworld.com/s/article/9193499/Like_Grokster_LimeWire_felled_by_secondary_liability_law?taxonomyId=70

Article links for a digital day

In the wake of the cyber attack on ACS:Law and the leaking of personal details of thousands of suspected illegal downloaders and file shares, an update on the Ministry of Sounds’ actions against individual actions in the UK here http://torrentfreak.com/anti-piracy-lawyers-face-ddos-before-pivotal-court-decision-101002/ and actions by filmmakers in the USA here http://news.cnet.com/8301-31001_3-20018358-261.html

And a useful review of the recent Digital Music Summit at Belmont University titled “Music industry fights clashing digital battles” with comments from record label associations the IFPI and the RIAA and some different views from consumer champions EFF, amongst others:
http://www.tennessean.com/article/20101003/BUSINESS01/10030328/Music-industry-fights-clashing-digital-battles

US record labels say that copyright law "isn't working"

Speaking at the Technology Policy Institute's Aspen Forum, The President of the Recording Industry Association of America, Cary Sherman, has said that the current U.S. copyright law "isn't working" for content owners and contains a number of loopholes - the main one he objected to is, of course, the safe harbour protection given to internet service provides (ISPs), web companies and telecomms providers. According to CNet, Sherman said the 1998 Digital Millennium Copyright Act "isn't working for content people at all," saying "You cannot monitor all the infringements on the Internet. It's simply not possible. We don't have the ability to search all the places infringing content appears, such as cyberlockers like [file-hosting firm] RapidShare." Sherman added that YouTube is doing a good job of filtering and removing copyright-infringing videos but added that Google could do much more than simply having YouTube remove videos making the example thsat "If you enter in "Beyoncé MP3" as a Google seach the "the chances are, the first thing you'll see is illegal sites." In response Lance Kavanaugh for YouTube, said that the DCMA is working exactly as Congress intended it to. "There's legal plumbing to allow that to happen, to allow those small companies to innovate without [the] crushing fear of lawsuits, as long as they follow certain rules," he said. "Congress was prescient. They struck the right balance". Youtube recently avoided liability in a case brought against them by Viacom, owners of MTV, for hosting MTV content without Viacom's permission because they operated a take-down system although Viacom plan to appeal the decision.

Sherman's comments, on an Act which was heavily lobbied over by ISPs, internet companies and the content owners - is based on the growing concern that the Act contains real and dangerous loopholes (well, dangerous for content owners) which allow ISPs and other web-based companies to ignore online copyright infringement without any legal comeback - although despite his concerns, Sherman added that he did not see new legislation as the solution to this at this stage - preferring to reach agreements with web firms directly. He explained: "We're working on [discussions with broadband providers], and we'd like to extend that kind of relationship - not just to ISPs, but search engines, payment processors, advertisers. But Sherman then added "if legislation is an appropriate way to facilitate that kind of cooperation, fine" saying it may be necessary for the U.S. Congress to enact a new law formalizing agreements with intermediaries such as broadband providers, Web hosts, payment processors, and search engines - one presumes the RIAA are contemplating asking the US legislature for new laws along the same lines as the various "three strikes" laws passed in the UK, France, Taiwan, South Korea and New Zealand.

The RIAA have also signed up to a new letter sent to Google and US ISP Verizon regarding their recent announcement on so called "net neutrality". The consortium of American content owners which included indie labels body A2IM and collecting societies BMI, ASCAP and SESAC, called on the two web giants to add cracking down on piracy to their joint mission.

Interestingly in related news, online advertising firm Triton Media is being sued by several movie studios for "contributory" and "induced" copyright infringement, over its alleged dealings with unauthorized websites offering their content for free. Disney and Warner Bros filed suit against Triton, alleging the firm helped websites like PirateCity.org and Watch-Movies-Links.net profit from piracy by handling their advertising sales. The studios said the advertising agency knew the sites were offering unauthorized content because they sent notices to Arizona-based Triton. The lawsuit seeks an injunction against Triton providing advertising services to the sites in the future, and unspecified monetary damages.

In other RIAA news, Joel Tenenbaum, the Boston University graduate student who lost his case against the recording industry for illegally downloading and sharing music has said that he will be appealing a federal judge’s order that he pay four record labels $67,500 in damages for copyright infringement, even though that amount is only a tenth of what a jury said he should pay for copyright infringement on 30 songs. The original order was a whopping $675,000. “Sixty-seven-and-half thousand dollars only sounds reasonable because it was so much before’’ said the 26-year-old former Providence resident, who then added that he would have to declare bankruptcy if forced to pay the smaller award. His lawyer, Harvard Law professor Charles Nesson, has filed a one-page notice saying he will appeal with the US Court of Appeals for the First Circuit. Nesson said in an interview that he plans to challenge several rulings Judge Nancy Gertner made at trial, including her refusal to let jurors hear that Tenenbaum offered to settle the labels’ claims against him in November 2005 for $500. The four record labels who brought the action (Sony BMG, Warners, Arista and Universal) have filed a similar notice and RIAA spokeperson Cara Duckworth said in a statement yesterday that the labels “had no choice but to appeal the erroneous and unprecedented decision’’ by Judge Gertner on July 9 to slash the award by 90 percent". “The ruling casts aside a jury verdict squarely within the range established by Congress and clearly supported by the undisputed harm to the recording industry and the egregiousness of the defendant’s conduct,’’ she said.

http://news.cnet.com/8301-13578_3-20014468-38.html
http://tinyurl.com/29326mq (Hollywood Reporter)
http://en.wikipedia.org/wiki/RIAA_v._Tenenbaum

The record labels vs the broadcasters - what’s phones got 2 do with it?

Here's a novel way to resolve a dispute between two parties. Ask the government to put an obligation on a third party to cure all your ills. The long-running dispute between US radio broadcasters and the recording industry over the royalties broadcasters should have to pay to use recorded music has taken an unexpected turn with a proposed settlement where a suggested new federal mandate would require all new mobile phones to come with a built-in FM radio chip. The National Association of Broadcasters (NAB) has long been fighting any proposals that would require radio stations to pay royalties to record labels and performers for the right to play their sound recordings on the air. The US (unusually) has no current legal requirement for a royalty for the use of recordings for FM stations - although now in the US internet, cable and satellite radio services and stations do have to pay an equivalent of the UK’s PPL royalty: Broadcasters have long argued that airplay provides free promotion and drives music purchases and concert ticket sales.

The new idea is to push forward a proposed settlement that would establish a tiered system of royalty payments that would bring in a total of roughly $100 million for the music industry. Commercial radio stations with more than $1.25 million in annual revenue would pay royalties totalling 1 percent of revenue. The smallest commercial and not for profit stations would pay either 1 percent of revenue or $100 annually, whichever is less.

The prospect that the US government could dictate key design decisions for mobiles has alarmed electronics manufacturers as well as consumer groups, not least as many say they don’t actually want or need FM on their phones, that it is an outdated and redundant idea and that practical problems such as a second antenna, reduced battery life, additional weight and more bulk would be unattractive to consumers. Gary Shapiro, Presient of the Consumer Electronics Association said “Consumers clearly aren’t interested in (ad laden) FM radio on their mobile phones and other consumer gadgets - especially with the availability of Pandora, Slacker and other similar smartphone music apps that are now widely popular" adding the “backroom scheme” from the broadcasters and the labels to have Congress mandate broadcast radios in portable devices, including mobile phones, “is the height of absurdity” adding “Rather than adapt to the digital marketplace, NAB and RIAA act like buggy-whip industries that refuse to innovate and seek to impose penalties on those that do.”

Both the House of Representatives and the Senate Judiciary Committees have passed bills that would give recording labels and artists a share of advertising revenue that the FM radio stations generate by playing their recordings, but neither of those contained a FM chip mandate. As both bills have stalled due to fierce broadcaster resistance, legislators asked the NAB and MusicFirst (for the labels and for recording artists) to try to negotiate a compromise. Hence the new mobile idea.

It seems that the parties are nowhere near concluding the deal despite optimism from the record labels with Recording Industry Association of America boss Mitch Bainwol saying that whilst “Nothing is locked down just yet" the parties were on "the precipice of an historic breakthrough”. Hmmmmmmmmm!

http://www.myce.com/news/riaa-broadcasters-want-fm-radio-mandatory-on-smartphones-33362/

Record industry mocked again as the cost of fan actions are made public

The Recording Industry Association of America's 2008 finances have been published with the revelation that the major labels trade body paid out over $17 million to the three legal firms who spearheaded the organisation's legal actions against file sharing fans. In return, they recovered $391,000 in damages. On his Recording Industry vs The People blog, Ray Beckerman analysed the same figures for 2006 and 2007 and claims that the trade body spent a total of $64,000,000 on legal and investigation firms involved in their “sue-the-fans” campaign during those three years, and these cases brought in a total of $1,361,000 in damages. The RIAA eventually dropped the strategy of suing individual fan after years of costly failures, bad publicity and widespread criticism of high profile cases against defendants such as Joel Tenenbaum and Jammie Thomas-Rasset. In the same year, the RIAA’s chief executive Mitch Bainwol was paid just over $2 million in salary ($1.9 million) and benefits ($123,000). President Cary Sherman was paid $1.33 million, Neil Turkewitz (EVP, International) was paid $696,000, Mitch Glazier (EVP, Government & Industry Relations), pulled in $566,000 and Steven Marks (EVP & General Counsel) received $562,000.