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The ADA Monthly Intellectual Property
Wrap-Up
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A monthly summary of recent legislation, cases, reports and other events
relating to intellectual property and the public interest, published by the
Australian Digital Alliance.
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December
2002
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[1] About this publication
[2] Dow Jones v Gutnick
[3]
ElcomSoft acquitted
[4] Private Copying proposal raised again
[5]
Designs Bills 2002
[6] Creative Commons: new licensing scheme nurtures
flexibility
[7] WIPO Internet survey issues
[8] I can copy, right?
[1] About this publication
This summary of recent IP
(but chiefly copyright) happenings of relevance to Australia is published every
month by email and on the Australian Digital Alliance website at
http://www.digital.org.au/issue/issue.htm. If you have
any suggestions as to what should go in the next issue, please let Miranda Lee
know by email: (mlee@nla.gov.au).
Nothing in this publication constitutes legal advice.
[2]
Dow Jones v Gutnick : defamation crosses borders
Without doubt, one
of the most significant developments in internet related issues this year has
been the Australian High Court decision of Dow Jones v Gutnick. The case is
important as it affirms the notion that a web publication is "published" in
each and every location in which it is able to be downloaded rather than the
jurisdiction where the material is uploaded.
The case arose when Dow
Jones, a multinational corporation (with assets in Australia), published
allegedly defamatory material about Melbourne mining magnate, Joseph Gutnick in
its online publication Barron's which was uploaded on servers in New Jersey,
USA. The article was available to Victorian readers who subscribed to the
Internet journal or to a print version of the journal. Gutnick pursued Dow
Jones in the Victorian Supreme Court, his claim relating solely to the damage
to his reputation in Victoria, and secured a judgement which held that the
Victorian Court was the appropriate jurisdiction to hear the matter. During the
hearing in the Victorian Court, Dow Jones claimed that in fact, the matter
should be heard in New Jersey where the article was uploaded as it was, Dow
Jones argued, the point at which the material had been "published".
The
matter was taken into the High Court where the decision of the lower court was
upheld on December 9th. The judges overall were unconvinced by arguments that
material on the Internet should be treated as intrinsically different from
material disseminated by other methods. The court instead extended established
principles of defamation law and private international law which had been
applied in cases involving more traditional media such newspapers, radio and
television, to the internet. The Australian High Court decision in effect,
deemed that the same laws that govern print essentially bind web content. The
Court admitted that there were difficulties in coming to such a conclusion but
insisted that the application of defamation law did not change in respect of
online content. Therefore, the appropriate jurisdiction for the matter is where
the defamation and damage to reputation suffered is said e to have occurred, ie
in Australia. Although the decision is fully in line with the defamation law
applied to traditional media, this is the first time the issue of internet
publishing had been adjudicated by a court of final appeal. Justice Kirby (one
of the judges in the case), noted that the result of the matter and the
difficulties encountered in the decision required national legislative
attention and international discussion.
The decision has spawned a bevy
of scare-tales about the implications for net publishing. It is feared that the
decision will stifle net publishing by subjecting publishers to a multitude of
national speech laws while simultaneously spurring a slurry of cross border
claims. While statutory protection of free speech in Australia is not as robust
as in the US, the two standards are not so far apart; rather, concern surrounds
the ramifications for net publishers' liabilities for material accessed in
jurisdictions where speech provisions are much more restrictive, such as in
Saudi Arabia and China. Indeed, Dow Jones had hoped to avoid having the matter
heard in Victoria because Australia's libel laws are more restrictive and less
favourable to publishers than those in the US.
One of the possible
ramifications of the decision is that countries could find themselves under an
increased pressure to harmonise legislation about free speech. Other opinions
have suggested that the decision may result in the further "sectioning" off of
the internet into jurisdictions, an occurrence which is already happening to an
extent that most people are unaware through technical and/or legal means.
The real outcome and impact of the decision is yet to be seen. However,
it should be noted that the decision was concerned specifically with elements
of defamation law and the place in which a person's reputation was damaged. The
decision may nevertheless have implications for determining jurisdiction for
actions involving other areas of law, including copyright.
The full
text of the decision can be found
here
[3] ElcomSoft acquitted
In the July 2001 issue of the
Intellectual Property Wrap-up, the case of US v Skylarov was introduced. The
case was launched last year when ElcomSoft employee Dmitry Skylarov was
arrested during a hackers conference in Las Vegas after giving a speech about
his company's software, which is designed to crack protections on Adobe
Systems' eBooks. Skylarov was charged with distributing software that removes
the restrictions on encrypted software (in this case, Adobe eBook files), an
infringing act under the Digital Millenium Copyright Act (DMCA). However, due
to unexpected and strong protests from the online community to the arrest,
Adobe backed away from its support of the case against Skylarov, and the
charges against Skylarov were set aside in exchange for his testimony in the
case against his employers. The US case is significant as it represents the
first federal criminal prosecution made under the DMCA.
The DMCA
includes provisions that prohibit companies from creating and selling
technologies that circumvent protections placed on copyrighted works. The
company faced four charges related to directly designing and marketing software
that could be used to crack eBook copyright protections as well as an
additional charge related to conspiring to do so.
Last week the jury
handed down their decision, acquitting the company of all charges.
During the two-week trial, the US government presented the argument that
ElcomSoft created a tool for burglars and charged that the company marketed its
software despite its questionable legality; it was alleged that company
representatives knew all along that they were violating the DMCA by designing
and offering the software to the public.
The lawyers for ElcomSoft, in
turn argued that the company acted responsibly, having withdrawn the software
from the Web shortly after learning of Adobe's concerns. Both Skylarov and
ElcomSoft President testified that they did not believe their software was
illicit and did not intend for it to be used on books that were not legally
purchased. As neither side contested that ElcomSoft sold software designed to
crack copyright protections, the case essentially turned on the company's state
of mind during the period the software was offered for sale.
In order
to warrant conviction under the US law, the company representatives of
Elcomsoft had to have been aware that their actions were illegal and intended
to violate the law; merely offering a product that could violate copyrights was
not enough. The jurors acquitted ElcomSoft because they believed that although
the Elcomsoft product was illegal, the company didn't mean to violate the law;
the jurors believed that ElcomSoft would not have openly marketed its allegedly
infringing program if its executives thought such an act was illegal. Although
both the company's president and managing director admitted awareness of the
DMCA in court testimony the jurors did not believe the Russian executives'
knowledge of the American statute was thorough enough for their behavior to
constitute a willful violation of the law particurlary since the jurors
themselves found the DMCA itself confusing. The willfulness standard was the
basis for much of ElcomSoft's defense.
The decision is important as it
represents one of the first setbacks for publishers seeking to assert the law
against software programmers and developers. Provisions of the DMCA create
penalties for creating and distributing such tools raising protests that the
law could, among other things, inhibit academic research and open discussion of
encryption technology necessary for technological development. Although this
decision bodes ill for copyright owners and publishers of digital content,
developers are far from immune to future prosecutions under the law.
[4] Private copying proposal raised again.
A
proposal to introduce private copying levy has been submitted to Government for
consideration. The proposal has come from Screenrights and the Australasian
Performing Right Association APRA and has been endorsed by copyright owner
groups and affiliates such as the Australasian Music Publishers Association
Limited, the Screen Producers' Association of Australia, the Australian Screen
Directors' Association, the Australian Writers' Guild, the Music Managers'
Forum, the Association of Independent Record Labels and Viscopy.
A
similar scheme was introduced in Australia in 1989, but declared
unconstitutional by the High Court in 1992 in Australian Tape Manufacturuers
Association Ltd.v The Commonwealth because the scheme embodied an imposition or
taxation not complying with s55 of the Constitution or otherwise would have
been invalid, as an acquisition of property otherwise than on "just terms",
within the meaning of section 51 (xxxi) of the Constitution. The re-introduced
scheme would purportedly overcome the problems of unconstitutionality through
structural difference from its predecessor. The revived proposal if
implemented, would generate private copying remuneration for rightsholders by
creating a licence to consumers of copyright material for private copying in
return for royalties. The proposed statutory copyright licence for private use
will mean that a levy will be attached to recordable media such as blank audio
or video cassette, recordable compact disc or recordable DVD. The proposed
scheme would make only the retailers of recordable media, responsible for
paying royalties to collecting agencies or industry groups representing
copyright owners.
The reasons cited for the re-introduction of the levy
is that private copying of music, films and television programs is occurring on
an unprecedented scale and, with the development of digital copying technology
is likely to increase, creating a loss to the creators and producers of
audio-visual material.
The Copyright Act does not currently contain a
provision creating an exception for private copying, and unlike the "fair use"
doctrine in the US Copyright Act, the Australian "fair dealing" exceptions in
respect of private copying provides for the limited uses of "research or
study". "Timeshifting", the popular practice of recording material for use at a
later time then presents a problem as it is not expressly provided for in the
current legislation. The position of the proposal makes it clear that it
considers this an unjust use of material which damages the rightful earnings of
rights holders.
The public policy debate of whether private copying in
fact constitutes infringement poses a serious question to the legitimacy of the
proposal. Certainly, the issue of the legality of private copying requires more
attention and it is perhaps this that should be addressed first before
considering the practical scheme of extracting levies from consumers (which has
its own obstacles such as legitimate uses of recordable media within the
current fair dealing exceptions).
The draft legislation forming part
of the proposal is available from the Screenrights site.
[5] Designs
Bills 2002
On 11 December 2002, the Designs Bill 2002 and the
Designs (Consequential Amendments) Bill 2002 were introduced into the House of
Representatives. Together the Bills give effect to the Government's Response to
the Australian Law Reform Commission (ALRC) Report No. 74 on Designs by
amending the Copyright Act to limit the overlap of copyright protection and
design protection by removing copyright protection for products considered as
essentially industrial and to deal with the sale of unprotected designs. The
broad policy behind the Bills is that artistic works that are commercially
exploited as three-dimensional designs should generally be denied copyright
protection. The Bills will not make any changes to the copyright protection
afforded to artistic works exploited as two-dimensional designs.
Both
Bills (and associated material such as the explanatory memoranda) are available
from the parliamentary
website.
Debate on both bills has been adjourned.
[6]
Creative Commons: new licensing scheme
Creative Commons, a new
system of differential licensing, was launched earlier this week in the US. The
initiative is designed to allow copyright holders to surrender some rights to
works while keeping others and is created with the aim of promoting creativity
while boosting the public domain.
The founding idea of the scheme is to
enable copyright holders to communicate the extent to which their works are
available for copying and other uses under specific conditions. The licenses
available under Creative Commons enable rights owners to retain copyright while
sharing to the extent that they wish. The basic principle of the initiative
differs from initatives supported by industry organisations which generally try
to retain tight control over the distribution of copyrighted works. The new
licenses are aimed at complementing existing efforts to make online sharing and
collaboration easier. It enables authors to communicate to users of their
content how those consumers may use the content, without requiring the user to
contact the author each and every time.
The inititiave is based on a
system of free, machine-readable licenses. Creators using the scheme can choose
to either release their work into the public domain or license the work with
custom license. The new license grants the public the right to copy and
redistribute a work freely, but under certain conditions, as the creator
chooses, such as attribution, permission for non-commercial use only, and
permission to distribute derivative works.
Licences issued under
Creative Commons will be available to a creator in three formats: as a commons
deed which is simple plain-language summary of the license; as a legal code
detailing specific legal details about the commons deed; and as a digital code.
The digital code, is a machine-readable translation of the license that
computers can easily recognize and will contain additional information such as
the title, author or creation date.
It is anticipated that licences
issued by Creative Commons will more likely be used by less known creators who
are seeking means to gain more exposure of their work without relinquishing any
of their traditional copyrights.
For more information, go to the
Creative Commons website.
[7] WIPO IP Survey of Issues released
World Intellectual
Property Organisation (WIPO) has recently published a report, Intellectual
Property on the Internet: A Survey of Issues, addressing the impact that
digital technologies have had on intellectual property (IP) and the
international IP system.
The Survey traces the evolving digital economy
and the interaction of intellectual property to the Internet, as well as
broader questions such as the impact of information and communications
technologies in the digital environment. Recent developments in the traditional
fields of copyright, trademarks and patents, as well as domain names, are
discussed as well as the progress in private international law and alternative
dispute resolution that relate to intellectual property issues.
The
chapter on copyright provides a useful summary of many of the issues that are
emerging in the area such as the rights of performers in the digital
environment, rights of digital broadcasters, enforcement of rights, discussion
on linking of copyright material, trends in licensing and rights management
including discussion on Digital Rights Management systems (DRMs) and issues of
peer-to peer file sharing.
The survey also explores the particular
concerns that face developing countries in e-development, and outlines the ways
in which WIPO is addressing these various issues.
The full text of the
report is available here.
[8] I can copy, right?
Yes, you can copy this
publication. Feel free to send it to friends or colleagues, print it off or
even archive it on your website provided that all text is included or, in the
case of an excerpt, appropriate credit is given.
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