Wednesday, February 13, 2008

No One Likes a Bully: The IIPA and Canada

Despite the use of the word “International” in its name, the International Intellectual Property Alliance (IIPA) is an umbrella group comprised of 7 U.S. trade associations: the Association of American Publishers, Business Software Alliance, Entertainment Software Association (video game industry), The Independent Film & Television Alliance, The Motion Picture Association of America, National Music Publishers’ Association, and Recording Industry Association of America; it pursues a purely U.S. corporate copyright agenda.

The IIPA had a modest infancy: it arose out of early legislative efforts in the mid 1980s to condition favorable U.S. trade benefits on other countries providing U.S. works “adequate and effective” IP protection, a concept very much in the eye of the beholder. With a ramped up GSP program and then the “Special 301” revision in the 1988 Omnibus Trade and Competitiveness Act, the IIPA quickly filled a vacuum: the Office of the United States Trade Representative (charged with enforcing trade laws) needed statistics to establish which countries were naughty and which were nice. Lacking any investigative resources of its own, USTR uses figures given to it by IIPA. The figures offered up by the IIPA on projected U.S. losses from “piracy” have been criticized for being wildly inflated, speculative, and based on demonstrably false assumptions, such as every pirated copy equaling a loss of a sale (and usually at U.S. prices). But what’s wrong with fudging for a good cause? And who are pirates to complain? (It also appears that the U.S. is the nicest country of all since it never appears on its own list, while major Western and many other countries have been tarred with varying degrees of naughtiness).

It is entirely proper for U.S. industries to protect their own interests. IIPA’s website, though, shoots for a loftier goal, that of helping to create “a legal and enforcement regime for copyright that not only deters piracy, but that also fosters technological and cultural development in these countries, and encourages local investment and employment.” The last two clauses evoke a globally beneficent outlook, one reminiscent of the “a raising tide lifts all boats” bromide according to which very high levels of protection are actually good for other countries because it protects authors from those countries. The bromide is false, though, and not only because the IIPA doesn't do outreach to help local investment or employment in foreign countries: it is also false because the ill-effects of hyper-copyright are felt in the U.S., from orphan works, to oppressive remedies, and misuse of circumvention rights to squelch competition and preserve outmoded business models. It must also be pointed out that the rising tide lifts all boats approach is one the U.S. deliberately eschewed in the first 100 years of its existence, resulting in the British referring to the U.S. as the Barbary Coast of Piracy, and that the U.S. did not join the Berne Convention until the extremely late date of March 1, 1989. The U.S. conversion to international copyright is quite recent; post-conversion, we have been acting like Paul, not Saul. Other countries, especially those who have been members of the Berne Convention since the 19th century, can be excused for thinking our conversion came about not out of faith but rather out of an opportunity to force U.S. law on the rest of the world; in short, copyright imperialism.

In practice, the IIPA’s efforts have gone far beyond issues of piracy. Its annual 301 report goes into great detail about the perceived deficiencies of all stripes in foreign laws, accusations that understandably offend those countries. Nor is the IIPA content with attempting to get other countries to adopt U.S. law lock-stock-and-barrel (and regardless of vast differences among legal systems): Last year, I reported on IIPA’s efforts to stop the Israeli Knesset from adopting the U.S. fair use provision in its statute. Apparently, it is only those laws that are favorable to U.S. corporate interests that “will foster[] technological and cultural development in these countries, and encourage[] local investment and employment.”

Sometimes countries fight back (and the Israelis, Baruch HaShem, passed their fair use provision anyway). IIPA’s repeated attacks on Canadian copyright law led Ms. Nancy Segal, a senior Canadian Foreign Affairs official, to remark last year:

In regard to the watch list, Canada does not recognize the 301 watch list process. It basically lacks reliable and objective analysis. It's driven entirely by U.S. industry. We have repeatedly raised this issue of the lack of objective analysis in the 301 watch list process with our U.S. counterparts. I also recognize that the U.S. industry likes to compare anyone they have a problem with, concerning their IPR regime, to China and the other big violators, but we're not on the same scale. This is not the same thing. If you aren't on the watch list in some way, shape, or form, you may not be of importance. Most countries with significant commercial dealings are on the watch list.

Member of Parliament Joe Comartin (Windsor—Tecumseh, NDP), then added:

My perception, and I think this is based on fairly decent material, is that if anybody was going to be on that watch list, the U.S. should put themselves on it, in the sense that they have more counterfeit material and goods going through their country, getting into their country, and manufactured in their country on a proportional basis than Canada does, by a long shot.

In reading these remarks, I remembered my seven years working on Capitol Hill, where on my daily trek up Pennsylvania Avenue to get lunch, I would pass by tables at which counterfeit DVDs were offered for sale, one block from the Capitol building itself, and right across the street from the Copyright Office. The Canadians officials quoted above were reacting, perhaps, to IIPA’s 2007 report, which began, “Canada’s long tenure on the USTR Watch List seems to have had no discernible effect on its copyright policy.” Ordinary people, when faced with such a lack of response from an immediate neighbor – in this case, a friendly, wealthy (Canada’s dollar is worth more than the U.S. dollar), high educated and networked country -- might re-evaluate an obviously failed policy, but no, IIPA’s recommendation was to throw more fuel on the fire, recommending that Canada be placed on an even naughtier list, the Priority Watch List, a recommendation repeated in the 2008 report, and to upbraid the Canadians for allegedly having a copyright law fit for Pirate Bay, not Thunder Bay.

So what are the IIPA’s beefs? The principal ones ostensibly concern Canada’s failure to implement the 1996 WIPO treaties. Examination of the IIPA’s 301 reports reveals, though, that what it has in mind is simply adoption of U.S. law, not amendments to Canada law that are consistent with the treaties obligations. The WIPO treaties modestly require only remedies for circumvention of Technological Protection Measures (TPMs) that involve the exercise of exclusive rights. Although the U.S. attempted to have the treaties include remedies for circumvention of access controls, other countries rejected the U.S.’s efforts. One would never know this from the IIPA’s reports, which mix the two together and lead readers to believe both are required; they are not.

Even more, the IIPA has stated (2004 report), “The WIPO digital treaties provide the principal legal tools required to fight piracy.” No evidence to support this assertion is presented, and the assertion is absurd: piracy (even as IIPA defines it), has existed for millennia, and the tools used to combat it have been traditional copyright rights and remedies. On this (and many other scores), Canada’s law is exemplary. I have not seen any proof that the U.S. TPM laws have led to a decrease in piracy within the U.S.; to the contrary, U.S. corporate interests constantly complain before Congress about the exponential increase of piracy, a “pandemic” that can only be cured by ever stronger laws. If we take content owners at their word, TPMs have been remarkably ineffectual, and therefore not something we would want to stuff down other countries’ throats. Indeed, in a stunning mea culpa not lost on Canadians, last year former U.S. Commissioner of Patent Bruce Lehman, the architect of the DMCA and of the U.S. negotiations at the WIPO treaties, stated during a symposium in Montreal that the DMCA had been a failure due – to copyright owners’ actions. See here.

The actual purpose of TPMS has nothing to do with piracy, and is stated in the concluding sentence to the one I quoted above from the IIPA’s Section 301 report: “Electronic commerce in copyrighted content requires a working digital marketplace in which only legitimate copies of works are transmitted, and only under the terms negotiated or permitted by the rights owner.” In other words, TPMs are all about preserving business models, not about piracy. In the United States, we have been waiting since 1998 for a working digital marketplace, after granting to IIPA’s members extensive rights in the DMCA on the promise that once the laws were in place, copyright owners would create the market. They haven’t: we are still nowhere close to even a nascent digital marketplace, much less a working one. But why not, since the laws are in place? The answer is content owners already have what they wanted, which is control over whether a legitimate marketplace will ever exist; but if it does, it will certainly be on their terms as IIPA clearly indicates. The purpose of the DMCA from their perspective was not to facilitate the actual development of a digital marketplace, but to give them veto power over whether one would ever exist, and if so, what it would look like. That’s why the DMCA represented a fatal blow to copyright as a system: rather than adapting copyright rights to the digital environment, the DMCA gave copyright owners the right to control the environment itself, with consequences that were entirely predictable given the past track record of the industry’s suits against innovations from talkies, to cable television, photocopy machines, and VCRs.

Lacking an authorized marketplace due solely to content owners’ failure to create one, it is hardly surprisingly that unauthorized ones grew up. Content owners response was not to provide consumers with what they wanted, but to declare war. Even Edgar Bronfman Jr., honcho of Warner Music, admitted this was a huge mistake, and it is the unwillingness of copyright owners to provide a legitimate market that led Bruce Lehman to publicly declare his own handiwork had failed. The idea that adherence to the WIPO treaties and a verbatim adoption of U.S. law is both necessary and sufficient to create a legitimate market and fight piracy has thus been roundly rejected by both Mr. Bronfman and Mr. Lehman, yet the IIPA continues to argue it to USTR and to the Canadian government.

The IIPA 301 report also insists on Canada adopting the U.S. notice and takedown safe harbor approach found in Section 512, but the IIPA doesn’t reveal that the WIPO treaties have nothing to do with ISP safe harbors. Indeed, it was content owners’ refusal to incorporate safe harbors into the DMCA that held up that legislation for three years, from 1995 to 1998. Content owners argued then that the WIPO treaties had nothing to do with ISP safe harbors. What a difference a few years makes.

The intense, negative reaction of Canadian citizens to IIPA’s efforts is well-taken. Why any government would want to adopt approaches that have been admitted to be a dismal failure in the U.S. by the law’s own ardent author, and that are not required by the
WIPO treaties is a mystery.


Anonymous said...

On some level the IIPA approach in Canada is simply lazy. The DMCA is a disastrous "solution" but to come up with an appropriate balance of interests in digital distribution would be, and one hopes, will be a great deal of work requiring creative and exhaustive thinking - - not mention expensive, which could be all the explanation needed for the laziness.

William Patry said...

Thanks, Anon. I agree that the IIPA is being lazy, but the laziness is skewered quite pointedly, and always in one direction; it is, at least not random laziness.

Anonymous said...

Thank you very much for that story! It gets annoying to read those stories over and over again about how Canada is filled with pirates.

It wasn't all that long ago that we shut down our entire nations airline system for 9/11 and provided hotels for emergency needs to Americans. Seems like a lot of that is forgotten by the IIPA (assuming they ever valued it at all).

But, it's a bit weird to see such strong proof that even Googles lawyers are "Do no evil'ers"! ;)

William Patry said...

mhaman, glad you like the posting. On your last point, we don't find it weird at all; it would be weird only if that wasn't the case.

Lawrence said...

As a Canadian, perhaps one with that intense disdain you speak of, I appreciate very much your clear analysis of what we in Canada have on our hands. I think we have noticed but I, speaking from my heart, hope and pray that you in the US summon the courage and the energy, to fix the roots of these problems, where something appears to have gone very wrong in your competitive markets, to give such influence to so few.

From my perspective, the US has a diminishing 18% share of the Internet users worldwide, yet it appears through the US Trade Representative's Office, to have an aggressive, hostile digital agenda for the other 82%, you called imperial but also appear to call essentially 'corrupt' in great detail.

Thank you.

Anonymous said...

thanks very much for the writeup, confirming what we all know to be true about the IIPA. Coming from another country who once suffered the bruising assault of the IIPA, I can emphathise with Canada's plight. We just could not believe what was in IIPA's report on our country, questionable data, embellishments of fact situations. However, for reasons unknown to me, we did capitulate and amended according to the 301 report, and now we are off the watch list, with the only victim being the copyright regime here turning into a psuedo-US system that is hardly an ideal system considering our stage of development. I applaud the Canadian efforts to denounce and not recognise the list, and hope that this will garner international support against the IIPA.

Anonymous said...

William Patry said...
"mhaman, glad you like the posting. On your last point, we don't find it weird at all; it would be weird only if that wasn't the case."

I suppose it is weird to me since your article make so much sense, and ms's lawyers have also blogged about the state of Canadian copyright law but their position is in very stark contrast to your own. There are very few legal blogs that pissed me off like that one did; it talked down to me, it was extremely biased, and entirely self serving.

All of my professional life I have supported ms, from version 1.0 of their programming languages (about 25 years worth of consulting). But, it's becoming painfully obvious that the support I give them is not returned in a manner I find acceptable. That is true from the top down, and includes their legal blogs.

It comes down to more than your corporate culture. It's commitment to doing what is right, and the more I see of Googles positions on all these topics, the more I like where you are going.

Anonymous said...

I was involved with the Canadian government's copyright reviews under the Liberals as a private citizen. It was an interesting exercise because they wanted to implement WIPO and to 'protect' aboriginals [who, apparently, are too childlike to understand the concept of 'property'.. uh.. yeahh... great cultural sensitivity there, Ms. Copps].

What came out of that was the view that our existing copyright laws, with perhaps one adjustment - a clearer definition of what constitutes a copyrightable work - already covered the WIPO digital copyright 'enhancements'.

Harper's reintroduction of the American style copyright amendments isn't about protecting copyrights, it's about cosying up to the US and that's a major red flag to Canadians.

Fortunately, Canada's second national sport is politics and we get cranky if the government does things we don't like (see the reign and inevitable demolition of Brian Mulroney and the Progressive Conservatives).

Russell McOrmond said...

Thanks for this great post and your help of us Canadians. I also blogged about this issue this morning. I called attention to a difference between some monopolist software vendors and their equivalents in the phone and cable companies. While the software vendors like Microsoft, Adobe and Apple are happy to abuse unintended consequences of excessive control over technology in the name of copyright, some Canadian phone and cable companies with similar anti-competitive goals didn't promote similarly dangerous policy.

Anonymous said...


the difference between ms and google is not in that one is inherently evil and the other one is not. they are both corporations that pursue their corporate interests.

microsoft's business model of selling shrink wrapped closed source software benefits from as restrictive copyright as possible. and as a corporation it would be seriously amiss if it'd allow it's own lawyers to blog against it.

google's business model is to sell online advertising. it benefits financially from such things as free access to the content, availability and variety of the content, net neutrality, etc. the good thing is that they allow their emloyees to talk about it in public. but i wonder what would happen if someone speaks against corporate interests...

so far, in the copyright struggle google is on "good guys" side ;). but not necessarily when it comes to privacy issues.

William Patry said...

Thanks so much Anonymous for your vote of confidence and blinkered view about how Google goes about defining its corporate interest in the first place, which is by far the more important question.

Russell McOrmond said...

I think things are far more complex than "Anonymous" suggests. Microsoft's looking at YaHoo can be said to be about a lot of things, with cloud computing being one. While MS's historical business model might have been selling licenses for shrink-wrapped petrified binaries, I believe they are heading into cloud computing and will be in pretty much the same space as Google.

I believe the question IIPA forces us to think about comes down to a core question about what you believe the new economy will look like.

Is the relationship of knowledge in the knowledge economy like products in the industrial economy,


is knowledge in the knowledge economy like machines in the industrial economy?

The members of IIPA such as Microsoft act as if they believe the former, and Google is acting like they agree with those of us that believe it is the latter. The Industrial economy wasn't about making machines hard to access, but making machines easy to access and then leveraging machines to improve other aspects of the economy. The knowledge economy won't be about making knowledge more scarce, but less scarce so that we can then leverage this knowledge to improve the economy.

I believe that the IIPA members will either eventually catch up to where the rest of us are already heading, or will have individually chosen to become chapters in the history books (archived on, and indexed by Google, but otherwise forgotten ;-)