Tuesday, January 30, 2007

Books on Tape and First Sale

The Sixth Circuit is fast becoming the most prolific court of appeals in copyright cases. The most recent opinion, from January 26th, is a case of first impression on whether books on tapes are covered by the exception to the first sale’s rental right. The correct answer, reached by the majority in Brilliance Audio, Inc. v. Haights Cross Communications, Inc., 2007 WL188103, is that lawfully made copies of such books may be rented without the copyright owner’s permission.

A ban on rentals was first applied to musical compositions in 1984 (amended in 1988), in response to the introduction of CDs and rental stores who pitched customers by saying “never ever buy another record." In 1990, Congress expanded the ban to include computer programs, but never beyond that. The 1984 and 1988 versions of Section 109(b)(1) were clearer on whether the rental ban extended to all audio works, stating that “Notwithstanding the provisions of subsection (a), unless authorized by the owners of copyright in the sound recording and in the musical works embodied therein.”

The 1990 formulation of Section 109(b)(1), amended to include computer programs, unintentionally injected a degree of ambiguity by its placement of computer programs in the middle of the clause: “Notwithstanding the provisions of subsection (a), unless authorized by the owners of copyright in the sound recording or the owner of copyright in a computer program . . . and in the case of a sound recording in the musical works embodied therein.”

Since the 1990 formulation was not intended to change the law regarding sound recordings, this unintended potential ambiguity should not be construed to include within the section nonmusical sound recordings; it is simply bad drafting. (And the 1990 amendments were very bad drafting indeed). The 1988 House Judiciary Committee report noted that no specific concerns about literary works had been raised, but that “if problems do arise, they may be addressed when the new [eight] year ‘sunset’ provision expires.

The majority in Brilliance Audio, per Judge Julia Gibbons, found the statutory language ambiguous (I think Judge Gibbons was being gentle in so saying), and therefore examined the legislative history. The decision, however, turned not on the legislative history but instead on what might be called a canon of construction: the first sale doctrine represents a firm Congressional policy against restraints on alienation, so any ambiguities in the statute should be construed against derogating from that policy. Hence, the majority's holding was: “The language of the statute does not unambiguously apply to audio books, and we have found no evidence that it should be so construed.” I think that right on the merits and as an interpretative method.

The partial dissent of Judge Kennedy would have vacated the district court’s grant of defendant’s 12(b)(6) motion, based on a plain meaning interpretation of the statute as prohibiting the rental of audio books. Based on that plain meaning assertion (no actual analysis of how the alleged plain meaning got to the plain meaning result was given; it was, instead merely asserted), Judge Kennedy criticized the majority for looking at the legislative history, even though that wasn’t the basis for the majority’s decision. Why go out of your way to make such an essentially gratuitous remark? In any event, I favor looking at legislative history whenever you please. What I find stereotypically amusing in the dissent is the absolute conviction that one’s own belief a particular provision is plain is so strong that those who feel otherwise must plainly be wrong.


Mark said...

I'm an avid renter of audiobooks. I usually get them at Cracker Barrel, where they "sell" them to you for full value, but accept returns less $3/week to a maximum of $18 per return.

Quite handy for long drives.

Anonymous said...

This is a little off topic, and a little late, but can anyone explain why the Sixth Circuit is the focal point for so much first-impression litigation?

It's not just copyright, but national security, and First and Fourth Amendment case law. The Sixth appears, to me at least, often on-par with the Second and Ninth.

I have my own theories, but I would be curious to hear other peoples' takes.

Anonymous said...

I am not sure the Sixth Circuit decides more issues of first impression than many of the other circuits, but it does contain two of the biggest states in the country -- Ohio and Michigan. And just because the "fly-over" types don't pay attention to the middle of the country doesn't mean they are correct. As you point out, a lot of good law is made outside of California and New York.

Ray Dowd said...

I'm afraid I have to side with dissenting Judge Kennedy on this one. The majority opinion states "It is less likely, on the other hand, that literary works invite the same kind of long-term, repeated enjoyment by consumers."

As a fan of Bill Cosby's and George Carlin's sound recordings predating that statute, I see no reason to depart from what appears to be plain in the language of the statute.

William Patry said...

Ray, but what is the plain meaning of the statute that gets you to your conclusion?

Anonymous said...

I am trying to sort out the First Use rulings as it might apply to a small producer and online retailer of art videos who finds her art videos purchased by a video retailer who feels they have the right to "rent" the copy they purchased from my company to the general public without authorization as many times as they want to -- and ckaim it all falls under First Use. Of course, I no longer sell to them, but I suspect they have obtained more copies through pseudonyms. Being a small business, I do not have the money for large legal bills, or even small ones. Can you direct me to the appropriate place in your archives or elsewhere where I may learn more about how to protect and defend my work? Thanks so much in advance for your consideration.

Sincerely, Teresa Spinner, Signilar Art Videos (www.signilar.com)