Copyright false positives.

AuthorDepoorter, Ben

Copyright enforcement is riddled with false positives. A false positive occurs when enforcement actions are taken against uses that are not actual infringements. Far from benign occurrences, copyright false positives inflict significant social harm in the form of increased litigation and transaction costs, distortions of licensing markets through rent-seeking behavior, increased piracy due to diminished public adherence with copyright law, and the systemic erosion of free speech rights and the public domain.

To combat this problem, this Article analyzes the causes that give rise to false positives, as well as their legal and social effects, and offers policy recommendations targeted at mitigating the damage of false positives. These policy recommendations include heightening the registration requirements to include a substantive review of all copyright claims, the promulgation of regulations dictating that copyright registrations be periodically renewed, and revision to the statutory damage provisions of the Copyright Act in order to encourage litigation that would help to excise false positives from the copyright corpus.

INTRODUCTION

In the geography of intellectual property law, copyright occupies a vast and verdant terrain, but its borders are poorly marked. The imprecise delineation of individual copyrights is both an intentional feature and an inherent flaw of the system: copyrights take minimal effort to acquire, (1) but the metes and bounds of the interests staked are often uncertain. (2) Unlike patents, where property rights are restricted to the claims contained in a successfully prosecuted application, (3) or trademark law, which only protects registered marks actually used in commerce, (4) copyrights inure at the moment of fixation (5) without any procedural or substantive inquiry into their scope. (6) As such, an author (7) of a putatively original work does not know, ab initio, the amount of protected expression contained in this work, (8) and so is unable to assess accurately the strength of her property claims. (9) Her original expression is protected, but the amount of originality her expression contains is often not readily discernible from the work on its face. (10) Similarly, it is often difficult to determine what part of another author's work is protected without extensive analysis of the substance of the work and the circumstances surrounding the work's creation. Every form of creative expression--from the crudest imitation to the highest reaches of originality--draws in part from prior art, both in form and in substance. (11) As a result, the boundaries of any copyright are vague and vulnerable to interpretation and second-guessing.

Such lacunae, in combination with other factors, (12) give rise to an abundance of copyright enforcement false positives, (13) where rights holders erroneously believe that their interests in a particular work extend beyond the bounds of what is actually protected. (14) These false positives often motivate copyright owners to seek enforcement of rights that are non-existent or outside the scope of copyright. (15) Such misguided enforcement actions impose significant social costs. (16) For example, automated enforcement technologies frequently send cease-and-desist letters or DMCA notice-and-takedown requests (17) for non-infringing uses. (18) In theory, such actions would seem relatively harmless given the numerous legal means available for alleged infringers to contest these erroneous claims. (19) In practice, however, even if successfully challenged by alleged infringers, the litigation costs (20) involved in correcting enforcement errors impose a burden on creative expressions (21) and the rightful exercise of public rights and copyright exceptions. (22)

Second, and even more problematic, are instances where transaction costs and risk aversion inhibit wrongly accused infringers from opposing copyright infringement actions. Such uncontested false positives contribute to so-called "fared uses" (23) and the development of industry customs where royalty payments are expected for the grant of unnecessary, and possibly non-existent, rights. (24) Even if an alleged infringer could afford to litigate, the high statutory penalties that would follow an unsuccessful defense act as an effective deterrent against contesting such claims. (25) As such, would-be defendants are incentivized into settling overly broad or even spurious claims, which, in turn, creates and perpetuates uncontested false positives. (26) In this way, copyright false positives heighten fears of liability, and create chilling effects among creative artists, (27) for whom even the cost of settlement may be financially unpalatable. (28)

A third cause of enforcement false positives results from the difficulties that courts experience when trying to distinguish between legitimate and illegitimate uses of content by means of the same technology. In the case of these partial false positives, (29) the deterrent effects of enforcement inadvertently spill over into legitimate activities. (30) For instance, when targeting the distribution of copyrighted materials among users of peer-to-peer ("P2P") file-sharing technology, courts effectively precluded people from using P2P for lawful activities, such as fair uses or the distribution of non-copyrighted material. (31) By assigning intermediary liability to technologies that potentially enable copyright infringement, partial false positives policies may chill investments in new inventions that also serve many otherwise legitimate purposes. (32)

False positives in various guises are unavoidable in law enforcement generally. (33) But a number of structural factors make the issue of false positives acute in the area of copyright law.

First, the symbiotic (34) relationship between copyright law and technology produces uncertainty as to the correct allocation of fights between consumers, copyright holders, and the public domain. (35) As new technologies have evolved, the distribution system for copyrighted materials has grown to include decentralized, pseudonymous networks of media businesses, technology companies, paying customers, and piratical free riders. (36) Within these networks, the legal question of who should bear the burden for copyright infringement is currently unsettled, and the fact-intensive nature of many copyright rules create an extra layer of uncertainty. (37) A landscape rife with legal uncertainty is fertile ground for overextended claims by copyright holders based on false positives. Such claims increase the occurrence, cost, and duration of litigation (in the case of contested false positives), as well as erroneously extend the scope of protection afforded to fights holders (as occurs with uncontested false positives). Similarly, uncertainty as to the nature and likely impact of new technologies on copyright holders makes it harder for courts to counter excessive claims by way of summary judgment and other procedural safeguards. (38)

Second, copyright false positives result from an asymmetry between the litigation costs and potential damages involved with copyright infringement, on the one hand, and the modest benefits of most potentially infringing activities, on the other hand. Transaction and litigation costs have a pervasive effect in the area of copyright because the expected costs of defending the right to use copyrighted material without permission (e.g., fair use) usually outweigh the more modest private value (but perhaps not the social value) of the use of the material by the alleged infringer. (39) This disparity between likely costs and benefits inhibits wrongly accused infringers from opposing copyright infringement actions. (40) This, in turn, creates rent-seeking opportunities for current copyright holders to engage in aggressive and potentially overbroad enforcement activities. (41)

Third, the vast scale of copyright infringing activities online contributes to the copyright false positive issues discussed in this Article. File-sharing technologies, social networks, and broadband Internet access in general have decreased revenues for traditional copyright-based industries. (42) This created a Hobson's choice in the mind of these copyright holders: either aggressively ramp up enforcement against all infringers (43)--despite widespread public condemnation of the practice (44)--or face potentially devastating losses in revenue. In response, copyright holders have employed a number of tactics that are prone to inducing false positives. For instance, copyright holders have increasingly turned to "algorithmic enforcement" where computer programs ("bots") scour the Internet looking for content that bears the markings of an infringement. (45) By using bots rather than human spotters, a broader range of potential infringements can be detected at far less cost than is required for manual enforcement, (46) but at the expense of greatly reduced accuracy. (47) As such, algorithmic enforcement actions contribute to a wide range of both contested and uncontested false positives. (48) Further, the practical impossibility of detecting all infringements leads to overreaching by copyright holders, both as a means of partially offsetting their losses and as a way to increase deterrence by heightening fears of getting caught. Finally, copyright holders may feel justified in pursuing aggressive enforcement strategies (49) because of a deep sense of injustice that comes from the perception (true or not) that technology companies and their users are benefitting from mass infringement. (50) In each of these instances, the economics of copyright enforcement contribute to a heightened number of false positives. In sum, copyright enforcement in the digital era faces an unprecedented problem relating to the frequency and severity of false positives.

False positives imperil the legitimate property interests of rights holders by diminishing...

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