Recording Industry vs The People: Suit Filed with FTC Charges Universal, NBC, Dreamworks, NFL, MLB, and Others With Misrepresenting Copyright Law by Ignoring Fair Use Statute

Friday, August 31, 2007

Suit Filed with FTC Charges Universal, NBC, Dreamworks, NFL, MLB, and Others With Misrepresenting Copyright Law by Ignoring Fair Use Statute

We have received a copy of the complaint filed with the FTC by the Computer & Communications Industry Association against such content owners as Universal, NBC Universal, the National Football League, Major League Baseball, Dreamworks Studios, and others, for misrepresenting copyright law in their "copyright warnings".

The case is

In the Matter of
Misrepresentation of Consumer Fair Use and
Related Rights
by
National Football League, NFL Properties,
Inc., NFL Enteprises LLC
and
Major League Baseball, Major League
Baseball Properties, Inc., Major League
Baseball Advanced Media, LP
and
NBC Universal, Inc., Universal Studios, Inc.,
and Morgan Creek Productions, Inc.
and
DreamWorks Animation SKG, Inc.,
DreamWorks LLC, a Viacom property
and
Harcourt Inc.
and
Penguin Group (USA), Inc.

The complaint starts off saying:

This complaint concerns the systematic misrepresentation of consumers’ rights to use legally acquired content by certain copyright-holding corporations. These corporations have engaged, and continue to engage in, a nationwide pattern of unfair and deceptive trade practices by misrepresenting consumer rights under copyright law, and in some cases threatening criminal and civil penalties against consumers who choose to exercise statutorily or Constitutionally guaranteed rights. These false representations violate the letter and spirit
of the Federal Trade Commission Act’s prohibition against unfair or deceptive acts or
practices in or affecting commerce.

and then goes on to provide very specific examples of false and deceptive statements by the content owners, attaching selected examples as exhibits.

Non-pdf versions of the full complaint are available online here at Groklaw (without exhibits) and here at Defend Fair Use (with exhibits).

Complaint in "Matter of Misrepresentation of Consumer Fair Use and Related Rights* (Full version, including exhibits, in *pdf format)

* Document published online at Internet Law & Regulation

Commentary & discussion:

Ars Technica
C/Net News
GrokLaw
p2pnet.net

Keywords: digital copyright online law legal download upload peer to peer p2p file sharing filesharing music movies indie independent label freeculture creative commons pop/rock artists riaa independent mp3 cd favorite songs

3 comments:

Matt Fitzpatrick said...: I've never seen a legal or technical claim about copyright, from copyright owners, that I'd consider to be honest information.

The most visible and familiar example of disinformation would be the "FBI Warning" on commercial DVDs. Its wording was almost entirely dictated by the studios. Before the FBI approved the standard message, I spotted a general "Warning" on an older Lions Gate DVD that matched the later FBI warning nearly word for word; I think it was missing only the words "investigated by the FBI."

This is the current FBI approved warning:

"Warning: The unauthorized reproduction or distribution of this copyrighted work is illegal. Criminal copyright infringement, including infringement without monetary gain, is investigated by the FBI and is punishable by up to 5 years in federal prison and a fine of $250,000."

True? Technically. Unauthorized reproduction or distribution is illegal, aside from that little thing called "fair use," of course. Criminal copyright infringement is indeed investigated by the FBI and carries harsh sentences. So what's the problem?

The message is highly, and likely deliberately, misleading, to anyone who doesn't read legalese. Note the lack of mention of fair use -- more on that later. More importantly, note the words "illegal" and "criminal," right next to each other. Most people don't realize that in legalese, the two mean very different things; in everyday English, the two words are synonyms.

Putting two and two together, to most people, this warning says in clear terms that if you copy the movie without permission, for any reason, you could go to prison, because it's "illegal" and "criminal." This is, as readers of this blog know, an entirely false conclusion, even without considering the full spectrum of fair use available to consumers.

Thus, this warning, dicated almost word-for-word by motion picture studios, exemplifies the sheer volume of deliberate disinformation in this country, contributing to unnecessary intellectual poverty, and the stifling of fair use. It is my hope that this complaint clears the air.; August 31, 2007 at 8:13:00 PM EDT
Jadeic said...: This action is long overdue. With rights come responsibilities and it is about time this important fact was drawn forcibly to the attention of the RIAA et al.; August 31, 2007 at 8:32:00 PM EDT
raybeckerman said...: Yes I was gratified to learn of this proceeding.; September 1, 2007 at 9:02:00 PM EDT

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JUDICIAL QUOTATIONS

"[T]he Court is concerned about the lack of facts establishing that Defendant was using that IP address at that particular time. Indeed, the [complaint] does not explain what link, if any, there is between Defendant and the IP address. It is possible that Plaintiff sued Defendant because he is the subscriber to IP address .... As recognized by many courts, just because an IP address is registered to an individual does not mean that he or she is guilty of infringement when that IP address is used to commit infringing activity." -Hon. Barry Ted Moskowitz, Chief Judge, S.D. California. January 29, 2013, AF Holdings v. Rogers
"The complaints assert that the defendants – identified only by IP address – were the individuals who downloaded the subject “work” and participated in the BitTorrent swarm. However, the assumption that the person who pays for Internet access at a given location is the same individual who allegedly downloaded a single sexually explicit film is tenuous, and one that has grown more so over time." - Hon. Gary R. Brown, Magistrate Judge, E.D.N.Y. May 1, 2012, K-Beech v. Does 1-37
"The concern of this Court is that in these lawsuits, potentially meritorious legal and factual defenses are not being litigated, and instead, the federal judiciary is being used as a hammer by a small group of plaintiffs to pound settlements out of unrepresented defendants."
-Hon. S. James Otero, Dist. Judge, Central Dist. California, March 2, 2007, Elektra v. O'Brien, 2007 ILRWeb (P&F) 1555
"The University has adequately demonstrated that it is not able to identify the alleged infringers with a reasonable degree of technical certainty...[C]ompliance with the subpoena as to the IP addresses represented by these Defendants would expose innocent parties to intrusive discovery....[T]he Court declines to authorize discovery and quashes the subpoena as to Does # 8, 9, and 14" -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, November 24, 2008, London-Sire Records v. Does 1-4
"[C]ounsel representing the record companies have an ethical obligation to fully understand that they are fighting people without lawyers... that the formalities of this are basically bankrupting people, and it's terribly critical that you stop it...." -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, June 17, 2008, London-Sire v. Does 1-4
"Rule 11(b)(3) requires that a representation in a pleading have evidentiary support and one wonders if the Plaintiffs are intentionally flouting that requirement in order to make their discovery efforts more convenient or to avoid paying the proper filing fees. In my view, the Court would be well within its power to direct the Plaintiffs to show cause why they have not violated Rule 11(b) with their allegations respecting joinder. [I]t is difficult to ignore the kind of gamesmanship that is going on here.....These plaintiffs have devised a clever scheme... to obtain court-authorized discovery prior to the service of complaints, but it troubles me that they do so with impunity and at the expense of the requirements of Rule 11(b)(3) because they have no good faith evidentiary basis to believe the cases should be joined." -Hon. Margaret J. Kravchuk, Magistrate Judge, District of Maine, January 25, 2008, Arista v. Does 1-27, 2008 WL 222283, modified Oct. 29, 2008
"[N]either the parties' submissions nor the Court's own research has revealed any case holding the mere owner of an internet account contributorily or vicariously liable for the infringing activities of third persons.....In addition to the weakness of the secondary copyright infringement claims against Ms. Foster, there is a question of the plaintiffs' motivations in pursuing them..... [T]here is an appearance that the plaintiffs initiated the secondary infringement claims to press Ms. Foster into settlement after they had ceased to believe she was a direct or "primary" infringer." -Hon. Lee R. West, District Judge, Western District of Oklahoma, February 6, 2007, Capitol v. Foster, 2007 WL 1028532
"[A]n overwhelming majority of cases brought by recording companies against individuals are resolved without so much as an appearance by the defendant, usually through default judgment or stipulated dismissal.....The Defendant Does cannot question the propriety of joinder if they do not set foot in the courthouse." -Hon. S. James Otero, Central District of California, August 29, 2007, SONY BMG v. Does 1-5, 2007 ILRWeb (P&F) 2535
"Plaintiffs are ordered to file any future cases of this nature against one defendant at a time, and may not join defendants for their convenience."
-Hon. Sam Sparks and Hon. Lee Yeakel, District Judges, Western District of Texas, November 17, 2004, Fonovisa v. Does 1-41, 2004 ILRWeb (P&F) 3053
"The Court is unaware of any other authority that authorizes the ex parte subpoena requested by plaintiffs."
-Hon. Walter D. Kelley, Jr., District Judge, Eastern District of Virginia, July 12, 2007, Interscope v. Does 1-7, 494 F. Supp. 2d 388, vacated on reconsideration 6/20/08
"Plaintiffs contend that unless the Court allows ex parte immediate discovery, they will be irreparably harmed. While the Court does not dispute that infringement of a copyright results in harm, it requires a Coleridgian "suspension of disbelief" to accept that the harm is irreparable, especially when monetary damages can cure any alleged violation. On the other hand, the harm related to disclosure of confidential information in a student or faculty member's Internet files can be equally harmful.....Moreover, ex parte proceedings should be the exception, not the rule."
-Hon. Lorenzo F. Garcia, Magistrate Judge, District of New Mexico, May 24, 2007, Capitol v. Does 1-16, 2007 WL 1893603
"'Statutory damages must still bear some relation to actual damages." Hon. Michael J. Davis, Dist. Judge, U.S.District Court, Dist. Minnesota, January 22, 2010, Capitol Records v. Thomas-Rasset
"[T]his court finds that defendants' use of the same ISP and P2P networks to allegedly commit copyright infringement is, without more, insufficient for permissive joinder under Rule 20. This court will sever not only the moving defendants from this action, but all other Doe defendants except Doe 2."
-Hon. W. Earl Britt, District Judge, Eastern District of North Carolina, February 27, 2008, LaFace v. Does 1-38, 2008 WL 544992
"[L]arge awards of statutory damages can raise due process concerns. Extending the reasoning of Gore and its progeny, a number of courts have recognized that an award of statutory damages may violate due process if the amount of the award is "out of all reasonable proportion" to the actual harm caused by a defendant's conduct.[T]hese cases are doubtlessly correct to note that a punitive and grossly excessive statutory damages award violates the Due Process Clause....."Hon. Marilyn Hall Patel, Dist. Judge, N.D. California, June 1, 2005, In re Napster, 2005 US DIST Lexis 11498, 2005 WL 1287611
"[P]laintiffs can cite to no case foreclosing the applicability of the due process clause to the aggregation of minimum statutory damages proscribed under the Copyright Act. On the other hand, Lindor cites to case law and to law review articles suggesting that, in a proper case, a court may extend its current due process jurisprudence prohibiting grossly excessive punitive jury awards to prohibit the award of statutory damages mandated under the Copyright Act if they are grossly in excess of the actual damages suffered....."-Hon. David G. Trager, Senior District Judge, Eastern Dist. New York, November 9, 2006, UMG v. Lindor, 2006 U.S. Dist. LEXIS 83486, 2006 WL 3335048
"'[S]tatutory damages should bear some relation to actual damages suffered'....(citations omitted) and 'cannot be divorced entirely from economic reality'". -Hon. Shira A. Scheindlin, Dist. Judge, Southern Dist. New York, August 19, 2008, Yurman v. Castaneda
"The Court would be remiss if it did not take this opportunity to implore Congress to amend the Copyright Act to address liability and damages in peer to peer network cases.... The defendant is an individual, a consumer. She is not a business. She sought no profit from her acts..... [T]he damages awarded in this case are wholly disproportionate to the damages suffered by Plaintiffs." -Hon. Michael J. Davis, District Judge, Dist. Minnesota, September 24, 2008, Capitol v. Thomas
"If there is an asymmetry in copyright, it is one that actually favors defendants. The successful assertion of a copyright confirms the plaintiff's possession of an exclusive, and sometimes very valuable, right, and thus gives it an incentive to spend heavily on litigation. In contrast, a successful defense against a copyright claim, when it throws the copyrighted work into the public domain, benefits all users of the public domain, not just the defendant; he obtains no exclusive right and so his incentive to spend on defense is reduced and he may be forced into an unfavorable settlement." US Court of Appeals, 7th Cir., July 9, 2008, Eagle Services Corp. v. H20 Industrial Services, Inc., 532 F.3d 620
"Customers who download music and movies for free would not necessarily spend money to acquire the same product.....RIAA’s request problematically assumes that every illegal download resulted in a lost sale."
-Hon. James P. Jones, Dist. Judge, Western Dist. Virginia, November 7, 2008, USA v. Dove