Copyright as Trade Regulation


B. Preempting the End Run Around Copyright



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B. Preempting the End Run Around Copyright

If copyright owners have used the copyright law to force third parties to police infringements of their works, copyright owners also have used other laws to control the way in which the public interacts with their works: first, by seeking to enforce restrictive “end user license agreements,” mostly for computer software, under contract law; and second, by persuading lawmakers to enact new laws (such as the Digital Millennium Copyright Act)225 prohibiting users from circumventing the encryption of copyrighted works—even in purchased copies.226 Scholars have characterized both of these “end runs” around copyright as serious, even devastating blows to the public interest in copyright, in part because neither contract law nor anticircumvention law makes exception for fair uses of copyrighted works.227 As Professors Dan Burk and Julie Cohen have articulated the problem, “[w]here technological constraints substitute for legal constraints, control over the design of information rights is shifted into the hands of private parties, who may or may not honor the public policies that animate public access doctrines such as fair use.”228

Notwithstanding the importance of these public policies, most courts have upheld efforts to enforce exclusive rights by means of contractual or technological controls. In ProCD, Inc. v. Zeidenberg,229 for example, the court was asked to consider the enforceability, under contract law, of a “shrinkwrap” license prohibiting buyers from engaging, inter alia, in the public distribution of databases containing telephone directories. (The public distribution of those databases would not constitute copyright infringement because under section 102(b) of the Copyright Act, “in no case does copyright protection … extend to any [such] discovery.”)230 Writing for the court, Judge Frank Easterbrook held that the Copyright Act (in section 301(a)) did not preempt the enforcement of that license under contract law because the “rights created by contract [were not] ‘equivalent to any of the exclusive rights within the general scope of copyright.’”231 As for technological controls, the Second Circuit Court of Appeals held in Universal City Studios, Inc. v. Corley232 that the prohibition in section 1201(a) of the Digital Millennium Copyright Act neither is subject to the fair use provisions of section 107 nor is required to be.233 As the court observed, “We know of no authority for the proposition that fair use, as protected by the Copyright Act, much less the Constitution, guarantees copying by the optimum method or in the identical format of the original.”234

These decisions contain echoes of grievance, as if courts perceive the rights under copyright law to be inadequate to punish invasions of the property right, most of which involve acts of copying. The result is a general “law of control” that violates the spirit, if not the terms, of the Copyright Act in section 301(a), which provides that those “legal and equitable” rights equivalent to copyright are to be “governed exclusively by this title [17].”235 On the subject of contractual controls, many scholars have urged courts to invigorate this doctrine of preemption,236 but the solution is not without its problems: How much of the state law on contracts do federal courts have the stomach to preempt? As Professor Lemley put it, “Using preemption doctrine against contracts is something like swinging a sledgehammer at a gnat: you are likely to hit the target, but you may do some serious damage to the things around it.”237 Worse, perhaps, “you might decide not to swing the hammer at all, for fear of hitting the wrong thing.”238 If preemption is tricky, try this solution to the problems posed by technological controls: Professors Burk and Cohen have suggested that the federal government create (and fund) an “escrow agent” whose sole job would be to issue “keys,” case by case, to users who could demonstrate a need for access to encrypted works.239 It would be far simpler, of course, to enact “an explicit … fair use exemption from the anticircumvention provisions” of section 1201, as Professor Benkler has suggested.240 As we have seen, however, fair use has its problems, too.

Amending the copyright statute to withhold the exclusive right of reproduction would do what these proposals would not: It would eliminate much of the claimed need for access controls by erasing many of the “harms” thought to justify those controls in the first place. Consider the Digital Millennium Copyright Act: Both the House and Senate Reports issued in support of passage contain language to the effect that the Act is necessary because of the threats posed by unauthorized acts of both reproduction and distribution. The language in the Senate Report is typical: it provides that “[d]ue to the ease with which digital works can be copied and distributed worldwide virtually instantaneously, copyright owners will hesitate to make their works readily available on the Internet without reasonable assurance that they will be protected against massive piracy.”241 Of the two rights, however, the reproduction right has drawn the most notice. In describing the respective provisions of sections 1201(a) and 1201(b), for example, the Senate Report instructs that section 1201(b) is meant to “prohibit[ ] devices primarily designed to circumvent … measures that limit the ability of the copyrighted work to be copied, or otherwise protect the copyright rights of the owner of the copyrighted work.”242 In Corley, too, the court focused almost exclusively on the threat posed by copying. It did so, in part, by remonstrating “pirates” and “thieves,” whom it described as those “who want to acquire [i.e., copy] copyrighted material (for personal use or resale) without paying for it.”243

If the exclusive right to make copies were not among those rights listed in section 106 of the Copyright Act, then it would not be a wrongful act to make copies of copyrighted works, so long as one did not also distribute those copies to the public. Whither the rhetoric about piracy and thievery? Copyright owners, of course, would continue to ask lawmakers to provide them with protection against circumvention of those technologies designed to hinder distribution; they may even continue to demand hindrances to copying; but one hopes, at least, that lawmakers would hesitate to grant copyright owners the right to prohibit the public from engaging in acts of copying that would be perfectly lawful under copyright law, in the service of which the Digital Millennium Copyright Act was enacted in the first place.244 Of course, if Congress were to amend section 1201(a) of the Act to prohibit the circumvention of only those measures that “effectively control[ ] the public distribution of a work protected under [title 17],” it probably would not stop copyright owners from using technological measures to prevent copying, if they could. But it also would not stop users from using technological measures of their own. As Professor Cohen has argued, “Copyright owners cannot be prohibited from making access to their works more difficult, but they should not be allowed to prevent others from hacking around their technological barriers.”245 This solution is only as good as the hackers that might provide it, but it may be good enough (for now).

In case of contracts, too, withholding the exclusive right of reproduction would deprive copyright owners of many of their justifications for imposing restrictive terms on purchasers of copies (e.g., of software). Copyright owners likely would continue to require users to agree not to engage in acts of copying. Because copying alone would be perfectly legal, however, copyright owners would be guilty of using contracts not to enhance their rights under copyright law, but to create new ones. This effort to deny the public the benefits of “legalizing” reproduction would present a strong case for preemption, for as the Supreme Court warned in Sears, Roebuck & Co. v. Stiffel Co.,246 “[w]hen state law touches upon the area of [the copyright and patent] statutes, it is ‘familiar doctrine’ that the federal policy ‘may not be set at naught, or its benefits denied’ by the state law.”247 But even if courts would be hesitant to use the “coarser tools” of preemption, Professor Lemley has argued that the “better tool” might be the doctrine of copyright misuse.248 “Copyright misuse” consists of the “attempted use of a copyright” either “in a manner violative of antitrust law … or in a manner violative of the public policy embodied in the grant of a copyright”—as if, for example, a licensor attempted to prevent its licensee from implementing the (unprotectible) ideas expressed in the licensed works.249 Contract terms that sought to prevent licensees from exercising their right to engage in copying sans public distribution likewise would “violat[e] … the public policy embodied in the grant of a copyright,” and therefore would render the offending copyright unenforceable “‘during the period of misuse.’”250 Again, this would not be a perfect solution, but it would result in a more equitable balance between “the claims of individuals” and “[t]he public good.”251




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