Tomorrow at 4 pm, the House IP subcommittee will mark-up, H.R. 5439 a bill introduced yesterday by chair Lamar Smith to deal with orphan works, that is, works whose copyright owner is MIA. The mark-up will be webcast (follow this link to the subcommittee).
In January, the Copyright Office issued its report on the issue, making a number of recommendations (see earlier posting). H.R. 5439 adopts the general thrust of the recommendations. The bill proposes a new Section 514, effective for uses that commence on or after June 1, 2008. I don't know what the rationale is for such a two year sunrise provision, but in my opinion it is preferable to the previous recommendation of a ten year sunset. A report is required by the Register no later than December 12, 2014 on the implementation of the act as well as any recommended changes. The Register is also directed to conduct an inquiry on the remedies for the "kleine munze" issue, that is, small copyright claims.
Simplifying things, Section 514(a) of the bill proposes to place limits on remedies where the court finds that the infringer, before beginning the unauthorized use, engaged in a good faith, reasonably diligent but unsuccessful search to locate the copyright owner, and after using the work, and provided a reasonable attribution (one might, for example, not know the author's name). The Copyright Office will assist in maintaining records for search efforts.
Section 514(b) is where the rubber hits the road. Section 514(b)(1) deals with monetary remedies. Section 514(b)(1)(A) limits recovery to reasonable compensation. Section 514(b)(1)(B) contains exceptions to this. 514(b)(1)(B)(i) states that not even reasonable compensation can be awarded if the infringement is made without any purpose of direct or indirect commercial advantage and primarily for a charitable, religious, scholarly, or educational purpose, so long as the infringer stops after receiving notice from the formerly submarined owner. While an exemption from payment is helpful, what happens if the infringement doesn't stop? Is the copyright owner entitled, for monetary relief, only to reasonable compensation or full remedies? I assume the former.
Two small drafting points on this subparagraph: the qualification that the exception does not apply if the court finds the infringer earned proceeds directly attributable to the infringement seems unnecessary since by definition the exception only applies on its face to cases where there is no purpose of direct or indirect commercial advantage. And if the infringer can't have gained any proceeds from the infringement, it may prove that the exception covers only a very narrow class of uses. The other drafting point is in 514(b)(1)(B)(ii), which comes at the very end of this paragraph and states that if the infringer fails to negotiate in good faith regarding the amount of reasonable compensation, the court can award full costs. Since this provision has no relevance to Section 514(b)(1)(B) - since uses in that section are uncompensated- it might be better placed as a proviso to Section 514(b)(1)(A).
Section 514(b)(2) deals with injunctive relief. This provision confuses me a bit. First, I don't quite grasp how it would work with reasonable compensation: other than reasonable compensation for past uses and an injunction against future uses, the two remedies can't work in tandem, and working in tandem in that manner undercuts a principal benefit of the proposal: permitting those who in good faith, after a reasonable effort, to invest in a project to then go ahead with the project (and recall that the infringer has to conduct the search before even beginning to use the work). It is true that the bill refers to the court taking into account the infringer's reliance on having performed the search, but I can't imagine the weight given to that would be great, much less determinative: after all preliminary injunctive relief is handed out as freely as swag at celebrity events, and in the Ninth Circuit the copyright owner is all but if not irrebuttably entitled to preliminary relief. I hasten to add that Section 514(b)(2)(B), dealing with transformative uses, precludes the court's ability to issue an injunction upon payment of a reasonable royalty and attribution, and it may be that such uses are the most worthy.
Hats off to the subcommittee for undertaking such a good government bill and for such a transparent process.
I agree that the bill represents very good policy. I have a detailed, section-by-section analysis on my blog.
ReplyDeleteThe two year sunrise period is most likely an attempt to give the industry most negatively impacted by the bill (visual artists) some time to develop new business models and better search methods for identifying the owner of a photograph or illustration (the currently available text-based searches are often less than helpful).
ReplyDeleteAnonymous:
ReplyDeleteThanks for the insight, which makes sense. Someday the technology will be around to do real image based searching.
10 years ago, or so, I used a commercial application called "Cumulus" from Canto Software that could do searches on images. You gave it one image as a sample, told it to find similar images, and it searched your image library for something similar.
ReplyDeleteI see the company is still in business, although the application has grown considerably. But I assume this basic functionality still exists in it...
FYI,
- CJ
HR 5439, the Orphan Works Act of 2006, was reported out of the Subcommittee on Courts, the Internet, and Intellectual Property Committee this evening by a voice vote. There were no amendments
ReplyDeleteRight, there is some technology out there that can find images in database. In addition to making sure those technologies can work in a large scale is simply the massive collection of data that has to take place to setup the database.
ReplyDeleteAnnual output for a portrait or wedding photographer is in excess of 30,000 images a year, commercial photographers typically create a lower number -- but still well into thousands... multiply that by any portion of the 120,000 professional photographers in the U.S. and then add in back catalogs of images ... and well, you get the idea. Two years will give us a running start on tackling the issue...
SM
FROM THE ILLUSTRATORS’ PARTNERSHIP
ReplyDeleteTime to Act
Artists and photographers have been joined by writers, textile manufacturers and others in realizing the threat of the Orphan Works Act of 2006 (HR5439). As we continue to spread the word, it’s time again to act in concert. Others in related fields will be doing the same. Starting in about one week – as soon as Congress returns from its Fourth of July recess, we’ll be emailing lawmakers in numbers. This notice is to give you time to get your letters ready.
First, we’re asking each of you to write your Congressional representative. Please note in your first paragraph that you are a.) a constituent; b.) a small business owner; c.) opposed to the Orphan Works Act. You can identify your representative by entering your zip code into http://www.congress.org
Second, please write to members of the House Judiciary Committee.
They can be located on the IPA Orphan Works Resource Page: http://www.illustratorspartnership.org/01_topics/article.php?searchterm=00175
Several members of the Judiciary Subcommittee are particularly important because they’ve already shown an understanding of the concerns we’ve expressed in previous letters. Please thank them for this and ask them to vote against this bill or table it until it an be properly re-considered and amended. Here are some of their names:
-Howard Berman (CA, 28th District)
-Darrell Issa (CA, 49th District)
-Bob Goodlatte (VA, 6th District)
-Howard Coble (NC, 6th District)
-John Conyers (MI, 14th District)
Below is one suggested sample letter. We’ll email you two more. Use any of these texts you like and feel free to modify them as you choose. You can edit, copy and paste the text of these letters onto your letterhead for faxing. In the letter below please insert an introductory sentence. Again, if you are a constituent, say so at first and cite your profession. Because the bill is being fast-tracked, it’s critical that we write now. To join us, get your letter ready for sending the week of July 10.
For additional information about Orphan Works developments, go to the IPA Orphan Works Resource Page for Artists
http://www.illustratorspartnership.org/01_topics/article.php?searchterm=00185
Please post or forward this email in its entirety to any interested party ____________________________________________________________________________
To have your name removed from this mailing list, send a reply email with “Remove Name” in the subject line. You will receive verification. To remain on our mailing list, send a reply email to this message with “Continue Mailing” in the subject line. You need only do this once.
SAMPLE LETTER:
The Honorable ______ ____________
U.S. House of Representatives
Washington, DC 20515
Via Facsimile
RE: HR 5439
Dear Rep ______________,
(INSERT INTRODUCTORY SENTENCE(S) HERE) As a small business owner, I am writing to express my grave misgivings about the Orphan Works Act of 2006 (H.R. 5439), now before the House Judiciary Committee. I strongly oppose this bill.
The Orphan Works Act has the potential to do great harm to those of us who create intellectual property. It was drafted to allow museums, libraries and other not-for-profit institutions to legally exploit the creative work of authors who have died or abandoned their copyrights. Unfortunately, it would do this by legalizing the infringement of all works - old and new, registered or unregistered, published or unpublished, domestic and foreign, managed or abandoned, whenever a work is unmarked so long as an infringer asserts that he or she has made a “reasonably diligent search” to find the rights holder.
This would expose to misuse countless works of visual art because clients often require artists to omit identifying information from their work, or because credit lines can be removed by feckless or unscrupulous users. Not only artists, but industries which license art can be harmed by this carte blanche license to infringe.
In the interest of brevity, I am enclosing some basic objections I and other copyright holders have to this bill.
• The Act is written so broadly that its use cannot be confined to orphaned work situations.
• It would permit an infringer to determine when he or she has made a “reasonable effort” to locate me even though the infringer would have a financial interest in not locating me.
• It would be retroactive, which means that work I created under existing law would be exposed to infringement because I didn’t take steps to protect my copyrights which the Copyright Act never required me to take.
• It would expose my work to infringement immediately upon creation, even though I am alive, in business and managing my copyrights.
• It would place an impossible burden of diligence on me to protect my work because I will never have the resources to police infringement, which can occur anytime, anywhere in the world.
• It would remove any meaningful remedies for infringement, even though the threat of meaningful litigation is the only means I now have to enforce copyright compliance.
• It would impose on me the burden of proving in court the amount of “reasonable compensation” I could collect from someone who has infringed my work as an “orphan”.
• But it would limit “reasonable compensation” to whatever sum an infringer is willing – or able – to pay.
• It would deny me injunctive relief in situations where the entirety of my “orphaned” work has been used in a so-called “transformative” work.
• And it would undermine my option to retain or sell exclusive rights to my clients because neither I nor my clients could ever guarantee that the work would not be used by others – even for purely commercial purposes.
• The inability to retain or sell exclusive rights would greatly decrease the market value of my work because market value is determined by the licensing potential locked up by exclusive rights.
• This bill would prevent me from restricting certain unwelcome uses of my art.
• And it could drive my work into low-end markets where I would otherwise never license my work.
• At present, the law does not allow infringers to claim my work by infringing it, but this legislation would let them.
• Yet by “limiting remedies” the bill guarantees that the cost of suing an infringer could exceed whatever sum I might recover in a successful court action.
• While the bill would limit the amount I could recover from an infringer, it would set no limits on the amount an infringer could win from me in a counter suit.
• And while the bill would not legislate “formalities”, it would have the same effect, because it would require artists like me to rely on marking, registering and meta-data as a condition of protecting our property.
• This would violate the Berne International Copyright Convention and fail the three-step test of TRIPs, which requires that exceptions to an artist’s exclusive rights should be limited to certain special cases, not interfere with an artist’s normal exploitation of his work and not prejudice a rights holder’s legitimate interest.
In short, the Orphan Works Act fails to properly define the category of orphaned work and it sets the infringer’s bar of due diligence so low that it virtually guarantees abuse.
It would force into the courts countless business decisions which should be made in the marketplace, and create problems which do not now exist but which would require the expansion of the entire Federal judiciary system to solve.
For those and other reasons, I ask you to consider the harm this bill can do to existing businesses and vote against it unless it is amended to do the following things:
a) Precisely define an orphan work as a copyright which is no longer managed by a rightsholder;
b) Raise the infringer’s bar of due diligence and define precisely the steps a user must take before infringing a work;
c) Eliminate the unrestricted use of a copyrighted work in a “transformative” work;
d) Restrict the use of true orphaned works to not-for-profit uses;
e) Restore full remedies for infringement as the only means rights holders have to protect their intellectual property.
Respectfully,
Freelance artists rely on the exclusive rights afforded them by copyright law to earn a living in their chosen craft. Many artists earn that living by licensing rights on an exclusive basis to third parties, for a limited time.
ReplyDeleteIf enacted, this legislation will prohibit artists from licensing rights on an exclusive basis, as an artist will have no means of verifying that the work is not in use by other parties.
Many propoonents of the legislation assert that artists need only put identifying information on their works to prevent the work from being orphaned. In reality, such identifying information is routinely removed or deleted from digital images after delivery or publication, thorugh no fault of the artist. Artists are thus unable to prevent their works from becoming orphaned. To suggest that artists must submit all of their works to registries is insanity. For example, a pro phtoographer may create tens or hundreds of thousands of works each year. Preparing and uploading large quantities of works to registries is beyond the means of most artists, and is far too great a burden on these rights holders.
To the extent that the legislation impairs artists from exercising their exclusive rights, this legislation violates TRIPS, and conflicts with the intent of copyright law by removing the incentive to create new works. "the Congress shall have power . . . to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries."
Musuems, libraries and research institutions should have the right to copy endangered works for preservation purposes and for the non-commercial activities of these institutions. This wouold ensure cultural preservation withou eviscerating the exclusive rights of artists and other creators.
To balance this legislation, a provision should be added to require attribution on ALL published works, including those works (not just on orphan works), and to deem the removal or attribution of such attribution an infringement.
Further, this legislation should be amdened to provide criminal penalties for abuse of the orphan works law, such as willfully making false claims of copyright ownership so as to secure fees from those who use orphan works. Without such a provision, fraud and abuse will be rampant.
Making these revisions and others would result in a balanced piece of legislation that provides access to works while also providing a great measure of protection against abause and the loss of attribution information.