Thursday, 19 July 2018

Artificial cosmoi and the law

Artificial cosmoi and the law (2nd edition)


A conference organised by
UCL Centre for Law, Economics & Society


Monday 30 July 2018 

9am - 5pm
at History Museum of Athens, 5 Tholou Street, Plaka, 10556 Athens, Greece


Book Now

About this event

Transformative general-purpose technologies have resulted in the “fourth industrial revolution”: Blockchain, Big Data and Data Science, gene editing through CRISPR, Artificial Intelligence and machine learning. Robots are leading to rapid changes in the way services are offered, products are manufactured, and commerce is made, leading to the emergence of new industries/spheres of economic activity.  Data collection is very extensive. There are legitimate concerns on privacy violations, and a need to a regulatory solution to guard privacy without killing the benefits of digital platforms. A new key area of business activity, platforms, bring together disparate sets of users, such as cardholder and merchants in a credit card platform or drivers and customers in Uber. Currently, the five most valuable firms in the world (Amazon, Apple, Facebook, Google, and Microsoft) are platforms. The development of blockchain and decentralised ledger technology may challenge the dominance of digital platforms and lead to a more decentralised economic system. “Winner-take-most” competition with the emergence of “superstar firms” may raise competition concerns but has also arguably led to a decline in labour’s share. Automation may relieve humans from certain tasks, so that they can spend time on more valuable work, or it can lead to the splitting up of activity previously exercised by humans in various activities, some of which may be automated. It can eventually replace an entire job once performed by a human, thus having important implications on employment in certain economic sectors and/or social inclusion.
Legal systems have been conspicuously slow in adapting to the needs of society and to the development of new technologies. When, even with delay, law reacts to societal changes, it usually has just a restricting function: it prohibits rather than enables certain types of activities. Thus, the law is a rather poor instrument in dealing with the cataclysmic changes brought by the very rapid developments in technology. These touch upon all aspects of social life, ranging from issues of employment and intellectual creation, or more generally the creation of resources, to new modes of data and AI-driven governance, affecting multiple environments, reaching from the streets and hospitals to the financial system and the battlefield. For the law to remain relevant, it will have to rapidly adapt to these challenges, so it can remain at the epicenter rather than the periphery of social and business activity. It is also important that technology entrepreneurs be cognizant of the crucial importance of the legal system and of the necessity of adaptive changes to it when designing their business models, since ignoring the role of the law may jeopardize their innovative efforts and disruptive innovations. The second edition of the "Artificial cosmoi and the Law" conference aims to explore the interactions between law and new general purpose technologies, such as blockchain, Artificial Intelligence and gene-editing, but also more broadly to reflect on the legal construction of digital capitalism.


  • Emilios Avgouleas, Chair in International Banking Law and Finance, University of Endiburgh
  • George Dimitropoulos, Assistant Professor, HBKU
  • Nick Economides, Professor at NYU Stern Business School
  • Hamid Ekbia, Professor of informatics, Indiana University Bloomington
  • George Flouris, Foundation for Research and Technology - Hellas (FO.R.T.H.)- Institute of Computer Science (I.C.S.)
  • Sotiris Georganas, Reader in Behavioural Economics City University London
  • Carsten Gerner Beurle, Professor of Commercial Law, UCL
  • Yiannis Golias, Rector, National Technical University of Athens
  • David Grewal, Professor of Law, Yale Law School
  • Christos Hadjiemmanuil, Professor of International and European Monetary and Financial Institutions at the University of Piraeus & Visiting Professor, Department of Law, LSE
  • Alexey Ivanov, Director, HSE Skolkovo Institute for Law & Development
  • Michael Jacobides, Professor of Strategy and Entrepreneurship; Sir Donald Gordon Associate Professor of Entrepreneurship and Innovation, London Business School
  • Aggelos Kiayias, Chair in Cyber Security and Privacy and director of the Blockchain Technology Laboratory at the University of Edinburgh
  • Mihalis Kritikos, Policy Analyst, European Parliament
  • Ioannis Lianos, Chair in global competition law and public policy, Director of the Centre for Law, Economics and Society, UCL
  • Bjorn Lundqvist, Associate professor of Law, University of Stockholm
  • Manos Mastromanolis, Assistant Professor of Commercial Law at the Faculty of Law of the University of Athens
  • Alexandra Mikroulea, Associate Professor in the Faculty of Law at the Athens University
  • Greg Pelecanos, Partner, Ballas, Pelecanos LLP
  • Alexandros Seretakis, Assistant Professor, Trinity College Dublin
  • Kostantinos Stylianou, Lecturer in Competition Law and Regulation, University of Leeds
  • Dimitris Tzouganatos, Professor of Competition Law at the University of Athens, Faculty of Law
  • Nikos Vettas, General Director of the Foundation for Economic and Industrial Research IOBE & Professor of Economics, Athens University of Economics & Business
  • Alexandros Varveris, Special Laboratory Educational Staff and Deputy Director of the Lab of Law and Informatics, Law School, UoA,
  • Angela Walch, Associate Professor at St. Mary’s University School of Law
  • Georgios Yannopoulos, Assistant Professor for IT Law and Legal Informatics, Director of the Lab of Law and Informatics, Law School, UoA


£60 standard ticket

Tuesday, 17 July 2018

The COPYKAT: "Faceswap" for the Statue of Liberty, trade wars, and embezzlement

It's been an exciting few weeks for copyright around the world. This CopyKat takes a look at three "David vs Goliath" disputes, in which parties (respectively) include the US Government, Fifa and an 8 year-old boy, and one of Africa's largest telecoms companies. Also in the news: YouTube rolls out its anticipated Copyright Match tool, copyright collecting societies in Kenya continue to struggle with accountability, and China launches an IPR awareness campaign.

Lady Liberty "faceswap" will cost the United States Postal Service $3.5M

Between 2011 and 2014, the United States Postal Service (USPS) used an image of the Statue of Liberty for its Forever Stamp series (a type of First Class postage stamp). Unfortunately for the USPS, the image they chose was not actually of the famous statue that towers over New York Harbor designed by French sculptor Frédéric Auguste Bartholdi in 1886. Instead, the image they chose was actually Robert S. Davidson's replica Statue of Liberty which looks over the New York-New York Hotel & Casino in Las Vegas. Davidson sued for – and won – nearly $3.5 (£2.6) million in royalties, plus interest.

As reported by Artsy, an eagle eyed stamp collector identified the mix-up in 2011. The USPS was made aware of the goof in 2013, but went on to print another 1.13 billion stamps with the replica’s image. For context, the judgement cited that the USPS made some $70 million in revenue resulting from sales of this Lady Liberty stamp alone.

The statues in NYC (left) and Las Vegas (right).

The Post Office purchased the photo used on the stamp from the image service Getty for $1,500 (£1,140). However, the license only covered the rights to Getty's photograph of the statue — and not the statue itself. The USPS neglected to seek permission from Davidson, likely because they simply assumed what it was using was in the public domain.

In its defense, the USPS asserted that the statue is a replica and accordingly, contains no truly original work. If true, this would render Davidson’s copyright claim invalid, and the government would owe nothing for its use of the replica statue’s image.

Davidson was therefore tasked with proving that his copyright in the statue was valid, which under US law requires only a showing of “some minimal degree of creativity” and that it was his own “independent creation” of those original elements.

By way of reminder, the focus is on the expression of an original idea and not the idea itself (Oracle Am., Inc. v. Google Inc., 2014). As such, Davidson’s statue did not need to be wholly original, but rather a “new and original expression” of some previous work or idea – namely, the famous Bartholdi statue.

Davidson argued in his lawsuit that he wasn't trying to create a replica of the original, but rather to craft a fresher, more feminine version. As was later quoted in the ruling, he “envisioned his mother-in-law as inspiration ... and viewed her picture every night during the construction of the face of the statue."

The Court examined photographs and was satisfied that Davidson “succeeded in making the statue his own creation, particularly the face.  A comparison of the two faces unmistakably shows that they are different.” Ultimately, the Court agreed that Davidson’s statue “evokes a softer and more feminine appeal.  The eyes are different, the jaw line is less massive and the whole face is more rounded. “

The USPS’s defense that the stamp fell under the fair use exemption was rejected by the Court. As the USPS printed “billions of copies and selling them to the public as part of a business enterprise … so overwhelmingly favors a finding of infringement that no fair use can be found.”

In case you’re wondering how the USPS – which is a US government agency – can be successfully sued for copyright infringement, 28 U.S.C. § 1498(b) waives sovereign immunity for claims of copyright infringement against the federal government “for the recovery of his reasonable and entire compensation as damages for such infringement.”

YouTube's "Copyright Match" offers enhanced screening technology (for a selected few)

As the CopyKat mentioned last month, YouTube has been beta testing a feature called Copyright Match, designed to find re-uploads of content on other channels. The tool will point content uploaders (creators) to instances where their work has been stolen, and allow them to request that YouTube delete the guilty party’s video on the grounds of copyright infringement. Last week, YouTube channels with more than 100,000 subscribers received access to the new tool.

When a creator uploads a video to the Copyright Match tool for review, other video uploads on different channels will then be scanned to detect similar content has been uploaded. Fabio Magagna, the product manager for the Copyright Match Tool, explained on the YouTube Creators blog that “when there is a match, it will appear in the ‘matches’ tab in the tool and you can decide what to do next”.

Although YouTube already offers an automated copyright-flagging system called Content ID, Copyright Match is different because it’s designed especially for YouTube creators who have problems with unauthorized re-uploads.

By YouTube’s own admission, the Copyright Match is “a powerful feature,” which will be monitored closely in its early stages. Magagna noted that the software will continue to expand over the coming months, “with the long-term goal of making it available to every creator in the YouTube Partner program.” The company insists that takedown requests will be reviewed to make sure they comply with YouTube’s copyright policies.

The introduction of Copyright Match comes at a time of intense debate surrounding user-uploaded content on social media platforms such as YouTube. In particular, The European Parliament recently voted to reject a new copyright directive.  At the heart of controversy for many was Article 13, a section of the proposed directive that focuses on the use of copyrighted material uploaded by users.

And yes, in case you’re wondering: new YouTube video reviews of Copyright Match are already available to watch.

Fifa takes down celebratory World Cup dance video: is this a step too far?

The World Cup is the largest single sporting event on Earth, with nearly half the world’s population tuning in. With England’s (somewhat surprisingly!) good run up to the Semi-Finals, fans of the Three Lions were especially eager to show their support.

When England’s captain Harry Kane scored a goal against Tunisia, a mother filmed her 7-year old boy celebrating the moment. She subsequently posted the short 5-second clip of him dancing in the living room on Twitter. However, FIFA - Football's ruling body - ordered the clip removed from Twitter. FIFA claimed the clip infringed their copyright, as viewers could see blurred football action from the family's TV in the background.

Speaking to the Mirror, Kathryn Conn explained that her son “is a massive Spurs fan and he absolutely worships Harry Kane so he started dancing around in the living room. All you can see on the TV in the background is a really blurry replay of the goal. It's hardly visible."
England captain Harry Kane won the Golden Boot for most goals scored in the tournament.

According to Conn’s tweet on the subject, the copyright notice from Twitter was brought under the US Digital Millennium Copyright Act. Several sources including iNews report that Fifa issued a letter stating: “On behalf of Fifa, we hereby assert that your making available and/or promoting of the protected content on your platform is not authorised by Fifa, its agent nor the law and that your activities in this regard serve as a serious infringement of Fifa’s exclusive rights.”

By way of background, Fifa reports on its finances page that around 95% of its revenues come from the sale of television broadcasting, marketing, and licensing rights related to the FIFA World Cup.
From the 2014 World Cup in Brazil, Fifa hauled in $4.8 billion in revenue, which turned a $2.6 billion profit for the association (which is then re-invested into development projects). Compared to ticket sales earned $527 million, Fifa’s broadcast revenue topped $2.43 billion, while sponsorship fees brought in $1.6 billion.

To date, Fifa’s intellectual property portfolio contains 14,000 trade mark registrations, about 300 registered designs, and 150 copyright registrations covering 157 jurisdictions overall. As is made clear in its 30-plus pages of official guidance on brand protection, Fifa has millions of reasons to be protective of its intellectual property.

Fifa engages in active surveillance and brand protection, which includes court proceedings to halt an infringing situation and seek financial compensation for any damages suffered. However, sharing official content belonging to FIFA by fans without any commercial benefit is expressly permitted, as per the branding guidance. Curious by nature, this CopyKat’s therefore wonders why an account with barely 200 followers was singled out in this instance.

Did Safaricom steal Songa app from former employee?

Web developer Evans Gikunda has sued Radio Africa and Safaricom, accusing them of infringing his copyright when they launched a mobile app, Songa by Safaricom several weeks ago. Safaricom is a leading mobile network operator in Kenya, and its Songa music app enables subscribers “to get their local and international songs in one place and keep them consistently entertained and updated.”
Gikunda claims that he created the music app between 2012 and 2016. In 2013, while working as a developer at Radio Africa, the Chief Executive at Radio Africa Patrick Quarcoo “persuaded Gikunda to partner with him to ensure that the product gets to market” (IPKenya). According to Gikunda, Quarcoo proposed that that once Radio Africa’s Board of Directors sanctioned its participation in his app, they would share out the ownership of the app. The ownership was proposed at Radio Africa – 40%; Gikunda- 30%; Quarcoo- 20%; and the remaining 10% to a strategic partner.
In 2016 Gikunda left Radio Africa (under less than favourable circumstances) and says that after his resignation, Quarcoo sold the app to Safaricom without consulting him. Gikunda had not been “involved in the process at any stage, and neither has he benefited from it; despite the claims he created the platform” (innova8tiv). As with most intellectual property disputes arising between (former) employees and their bosses, establishing the ownership of the copyright subsisting in the Songa app lies at the heart of this matter. Gikunda is asking the High Court to compel Safaricom and Radio Africa to reveal how much money they have made from ‘Songa by Safaricom’ and is seeking damages.

To be successful in his claim, Gikunda will need to establish that he created his app outside the scope of his employment with Radio Africa, and that the app currently used by Safaricom is a reproduction or adaptation of his original app. To complicate matters, Gikunda’s app has been known under a variety of other names, including ‘NakedGroove’, ‘The Platform’, ‘The Music Platform’ and ‘RAMP’ – the latter being an abbreviation of either ‘Radio Africa Music Player’. Additionally, neither Gikunda nor Radio Africa obtained copyright registration, which further confuses the evidence.
This calls into question whether or not Gikunda made the program as part of his employment with Radio Africa (see also the work-for-hire doctrine), as well as the enforceability of moral rights for digital works. To achieve an injunction against the companies, which Gikunda is also seeking, he will need to prove that damages alone are an insufficient remedy.

Copyright woes continue for Kenyan collecting societies

Kenya's High Court

Elsewhere in Kenya, the complicated saga of the copyright collecting societies continues. Most recently, the High Court (pictured) ordered the Music Copyright Society of Kenya (MCSK) to account for the money it has collected as royalties and licence fees since January 1st 2017. Justices RN Sitati, DS Majanja and TW Cherere have given the MSCK thirty days to comply with the order (The Star).
In 2015, it was noted that MCSK's disbursement of royalties to artists has been decreasing for several years. The Kenya Copyright Board (KECOBO), the government organisation tasked with enforcing copyright in Kenya, established a minimum standard of 70% of revenue to be given back to artists. However, MCSK’s disbursement rates to musicians has fallen to 58.9% of collected revenue. Although MCSK was once Kenya’s largest royalty-collecting body, KECOBO revoked its licence in February of 2017 when MCSK failed to provide audited financial statements. The move came amidst allegations from local artistes over embezzlement of their royalties by MSCK.

As the CopyKat discovered back in May, Kenya is not the only African country to be experiencing problems with copyright collecting societies: power struggles with the Copyright Society of Nigeria (COSON) and the Nigerian Copyright Commission continue. 

Copyright awareness comes to China 

China has launched a four-month campaign to protect the intellectual property rights: you can visit the campaign website here. First announced in September, the campaign is seen by many as an attempt to alleviate major concerns among foreign investors, including those in the United States. 

China’s lack of strong intellectual property rights protection measures “frequently draw complaints from foreign investors and have been a long-standing focus of attention at annual talks with the US and Europe” (South China Morning Post). The Trump administration has officially launched a probe into alleged Chinese intellectual property theft which, amongst other things, led the United States to impose punitive tariffs on Chinese products. 

The campaign, which will last for at least four months, has been jointly launched by the National Copyright Administration of China (NCAC), the Cyberspace Administration, the Ministry of Industry and Information Technology and the Ministry of Public Security.

It will target key areas including unauthorized republication of news and plagiarism on social media, unauthorized broadcasting of copyrighted content on short video sharing apps, and copyright violations by setting up overseas servers. The campaign will also push service providers to enhance their internal supervision systems (China Daily).
Chairman Mao Memorial Hall in Beijing
In 2012, an article on Forbes argued that “IP protection will always be an uphill struggle in China and for companies doing business there,” as individual rights – including intellectual property rights – may be in some instances at odds with traditional Chinese society. 

A more recent Reuters article from April of this year explained that while Chinese IP protection laws are comparable to U.S. and European legal standards, the weakness lies in implementation, with high levels of bureaucracy. In particular, “court decisions applying on a provincial level rather than nationally, and judges often having different interpretations of the laws.”

In China, many consider that “even the education system works against an embrace of IP protection,” and until IP infringement is seen as an immediate threat to economic success, “few will really care.” Will a potential trade war be the impetus China needs to close the gap?

Tuesday, 10 July 2018

The CopyKat - Copyright in DSM Directive Vote and Copyright Infringement Actions

Proposal for Copyright in the DSM Directive – Where are we Heading Now?

Following the vote of EU Parliament’s Legal Affairs Committee (JURI) in favour of the Directive for Copyright in the Digital Single Market (known as Copyright Directive) last week the plenary session of the European Parliament has rejected the proposal that aimed at updating the rules for the digital age [reported here]. After a number of protests from the internet platforms, including Wikipedia blocking access to its websites, and opponents who believed that the Directive, if adopted in such shape, would limit internet freedom and creativity, MEPs have decided that the proposed changes require further debate. The rejected bill aimed to strengthen the enforcement of copyright rules online, wit the new provisions in Article 13 requiring internet intermediaries to monitor their platforms anc put filtering mechanisms in place which would detect copyright infringement and block the infringing content. Article 11, known as ‘link tax’ planned to require online platforms such as Google and Facebook to buy licences from media and news companies before providing links to their stories. This, opponents argued, could prohibit anyone from providing commercial service to use snippets from online articles without obtaining a licence from publishers. In the letter addressed to MEPs 70 internet leaders shared concern over the proposal saying that the proposed changes would take “an unprecedented step towards the transformation of the Internet from an open platform for sharing and innovation, into a tool for the automated surveillance and control of its users”. On the other hand, artists and music industry strongly supported enactment of new copyright rules. Sir Paul McCartney urged MEPs in a letter to “uphold the mandate on Copyright and Article 13” and wrote that the proposed Directive would address the value gap and ensure “a sustainable future for the music ecosystem and its creators, fans and digital music services alike”. Michael Dugher, UK Music CEO believed that the changes could “end an injustice that has seen Google’s YouTube and other big tech firms ripping off creators for far too long”. The body had previously accused Google of spending €31 million on lobbying operation that was aimed at issues related to the digital copyright reforms. It's not over yet - and the rejection mans that  proposals will now be further considered after a rarely invoked Parliament procedure was used, and now MEPs will have a month to propose their amendments with a new vote likely to take place in September. Until then the increasingly raucous debate, which already brought a lot of attention, is likely to get even more heated.

While most of the eyes were focused on the vote in the European Parliament, the Regional Court of Hamburg has ruled in favour of German Collecting Society GEMA regarding the liabilities of the UseNeXT platform. According to GEMA, UseNeXT together with its owner Aviteo should be liable for copyrights of its users who shared unlicensed music and movie content through the Usenet platform. In the view of the Court, under German law internet platforms such as UseNeXT may be liable for copyright infringement of its users, where the business model promotes in a certain way, the uploading and distribution of copyrighted material that is unlicensed. The Court also considered that Aviteo is liable for the infringement in this case on the basis that it provides tools that aim to seek out music and movie files. Dr Tobias Holzmüller from GEMA believes that this case is a great success for the songwriters and publishers that are gathered in the society and creates “an important precedent for claims for damages in the field of internet piracy,” where online platforms “cannot hide behind legal principles.” Although the ruling is favourable for GEMA it is not yet binding as Aviteo can bring an appeal.

The US District Court in Dallas has ruled that Facebook-owned Oculus which specialised in the development of VR devices is required to pay $250 million for using ZeniMax’s computer code in its virtual reality headset, which is popular among video gamers. After the acquisition of Oculus by Facebook in 2014, ZeniMax brought a lawsuit which alleged that when one of its employees had left the firm and stolen ZeniMax’s intellectual property. Judge Ed Kinkeade has affirmed the jury’s decision awarding ZeniMax $200 million for breach of contract and $50 million for copyright infringement. The judge, however, decided not to award an additional $250 million which was claimed against Oculus co-founders. Additionally, ZeniMax’s request to ban sales of Octopus headsets was rejected. According to ZeniMax, Oculus continuously infringes its copyright and therefore “a permanent injunction is the only way to stop it.” Oculus viewed the infringement of copying seven lines of the code as insignificant given that the software consisted of over 42 billion lines.

Ed Sheeran has been hit with another copyright infringement lawsuit. Having settled a conflict in relation to ‘Photograph’ [more details here], this time he has been accused by the heirs of Marvin Gaye of copying ‘Let’s Get It On’ song in his ‘Thinking Out Loud’ composition. The lawsuit was brought by Structured Asset Sales (SAS) and follows a failed attempt by SAS to join the previous Townsend (Gaye’s heir) action, which was turned down on 11 June 2018. Now SAS has filed the lawsuit itself and seeks $100 million in damages for the portion of Gaye’s song that they own. As argued by the owners in their action against Ed Sheeran and co-writer of the song, Amy Wadge, ‘Thinking Out Loud’ takes many elements from Gaye’s song, such as “the melody, rhythms, harmonies, drums, bass line, backing chorus, tempo, syncopation and looping.” 1709 readers will no doubt remember that in 2015 the owners of Gaye’s song catalogue filed and ten won a successful (if somewhat controversial) suit against Robin Thicke and Pharell Williams’ “Blurred Lines” hit and accused them of copying ‘Got to Give it Up’  song.

YouTube’s Content ID system aims at ensuring that copyrighted content is not used without the author’s permission. The system has, however, some limitations and there are situations where it makes mistakes that result in the wrong content being taken down and demonetised [previously reported here]. This time, Paul Davids, who is a Dutch YouTuber known for his videos where he plays various famous guitar riff, last month has received a copyright infringement notice from the Content ID system for one of his videos. As he claims it turned out to be his own video that he had infringed upon. The author was particularly shocked when he found out that someone else took his original track, “added vocals and guitar to make their own track, and uploaded it to YouTube”. As a result of the notice, all the money which were earned from the video rather than to the original author were directed to the person who has copied his content. Following the appeal procedure, YouTube has resolved the matter in favour of the original author.

Last year, following a use of a piece of library music called ‘Eminem-esque’ in their 2014 election campaign advert, a Wellington High Court in New Zealand has found that the music used by the National Party had substantially copied the Eminem’s song ‘Lose Yourself’ [discussed here]. Accordingly, the Court has ordered the National Party to pay NZ$600,000 as the "hypothetical licence fee that would have been charged” had the publisher given permission to use the copyrighted work. Now, the political party has appealed to the Court of Appeal aiming to lower the amount that they have to pay in damages for their copyright infringement. In the opinion of the Nationals’ lawyer, the Court relied on the advice of an expert who had no relevant experience in New Zealand and the if fact the ad campaign only ran for 11 days. Therefore, no premium prices should be charged. As reported by NewsHub, the decision is reserved, meaning that the outcome a decision may be known in several weeks or months. Conversely, the rights owners believe the damages are insufficient!

Thursday, 5 July 2018

BREAKING NEWS - EU Copyright Reforms Stalled

European MEPs who voted on the Copyright Directive in Strasbourg today have failed (by a small majority) to move the legislative process forwards whereby the European Union Council, Commission and Parliament could have negotiated a final text for passage into law. The vote was close, with 278 in favour, 318 against and 31 abstentions. The outcome rejects the earlier Legal Committee decision to approve the draft law, which will now be sent back to parliament for further discussion.

The battle to update the EU’s copyright laws, the first since 2001, has sparked fierce lobbying from opponents to the  led by internet giants such as Google and free specch advocates (see our previous post), with the backing of celebrities such as Stephen Fry and Tim Berners-Lee, and those in favour of the plans such as film companies and record labels and artistes who included the former Beatle, sir Paul McCartney and James Blunt.

The cultural and creative sectors, and rights owners will be more than disappointed. Anders Lassen, president of the European Grouping of Societies of Authors and Composers who backed the rule changes, said the vote was a “missed opportunity”, and PRS for Music’s Chief Executive, Robert Ashcroft said this

 “It is perhaps unsurprising considering the unprecedented level of lobbying and the comprehensive campaign of misinformation which has accompanied this vote that MEPs want more time to consider the proposals. The vote showed that many MEPs across the various European political parties understand the importance of fixing the transfer of value and of a well-functioning market for copyright. We appreciate their support and hope that as we move forward to the Plenary debate in September, more MEPs will recognise the unique opportunity to secure the EU’s creative industries.

“From the outset our primary focus of this legislation has been concerned with whether or not the internet functions as a fair and efficient marketplace – and currently, for artists and authors, it doesn’t. They want their creative works to be heard, they embrace technology, but they want to be paid fairly. We will continue to fight for what we believe is their freedom and a fair use of their creative works.”

MEPs will now have to go back to the drawing board this summer before the proposals are voted on again in September.

Friday, 29 June 2018

What's all the fuss about? It's those EU copyright reforms

Following on from previous CopyKats, the noise around the proposed changes to EU copyright law has reached a crescendo - and it's not just the tech giants and content behemoths who are lobbying at all levels, the former against changes, the latter very much in favour of the main changes in the Directive for Copyright in the Digital Single Market (known as Copyright Directive) which was approved by the European Parliament's Committee on Legal Affairs on the 20th June 2018.

The most controversial provisions are in the current draft of Article 13, which requires internet platforms to perform automatic filtering of the content that their users have uploaded. As the CopyKat reported, a group of over 70 internet leaders including Vint Cerf and British physicist and computer scientist Tim Berners-Lee.addressed Members of the European Parliament (MEPs) by sharing their concerns regarding the proposed text of the Directive. In their June 12th letter they said “Article 13 takes an unprecedented step towards the transformation of the Internet from an open platform for sharing and innovation, into a tool for the automated surveillance and control of its users” making the argument that this requirement goes against the previously established balance in the E-Commerce Directive and the ‘Safe Harbour’ provision in Article 15 of the InfoSoc Directive, where users uploading content are solely responsible for its legality, whereas platforms may be required to take down illegal content once it is brought to its attention. 

Julia Reda, Member of the European Parliament, (for the Pirate Party) agreed with the internet gurus, criticising the high error rate expected from the algorithms and the resulting blocking of content. Reda describes on her website a phenomenon called "Startup killer". And Reda suggests that the filters will be so complex that they can only be developed by the big US tech giants. Small companies and start-ups will not be able to afford the programming and so every small platform that offers user-generated content will have to acquire their filter system from the big players. Reda then suggests that this creates a monopoly for the likes of Google. 

Article 11 is the other main focus of attention. This would require of a new level of engagement between platforms and news creators and providers. Reda writes, "The automatic link previews social networks generate when users share links (showing the article headline, a thumbnail picture and a short excerpt) would require a license, as well as anyone analysing news content on the web like news aggregators, media monitoring services and fact checking services." This is the so called 'Link Tax'. Reda also claims that that Article 11 could limit freedom of expression and access to information, boost fake news, discourage startups and small publishers saying "Making it legally risky or expensive to link (with snippets) to news risks disincentivising the sharing of reputable news content. Since “fake news” and propaganda outlets are unlikely to charge for snippets, their content could as a result become more visible on social networks."

But Google, one of the leading lights in the battle against the proposed changes, has faced criticism. The Financial Times reports that Google has been accused of encouraging news publishers participating in its Digital News Initiative to lobby against proposed changes to EU copyright law at a time when the beleaguered sector is increasingly turning to the search giant for help. Google itself opposes the copyright directive, which it says would impede the free flow of information, and in a recent email to publishers suggested they contact members of the European Parliament to express their views. The search engine has developed close ties with publishers via its DNI programme, which provides support for digital journalism as well as innovation grants from a €150m fund. Angela Mills Wade, executive director of the European Publishers’ Council, said Google was trying to preserve the status quo. “It seems to be arguing for the news eco-system of today to continue,” she told the FT. “We feel that Google has largely created a news eco-system where it is apparently perfectly acceptable for companies to go around helping themselves to news media content for their own purposes.

EU-based media organisations have hailed the Copyright Directive in a joint statement calling it “a crucial stand for the future of a free, independent press.” “The internet is only as useful as the content that populates it.” The statement also applauded Article 11, known as the “neighbouring right,” for “encouraging further investment in professional, diverse, fact-checked content for the enrichment and enjoyment of everyone, everywhere.”

So - who else is having a say? Well first off, a group of open science advocates have made the point that the new proposals will conflict with Europe’s principles of open science and freedom of expression. Vanessa Proudman, European Director of the Scholarly Publishing and Academic Resources Coalition (SPARC), a science-advocacy group in Apeldoorn, the Netherlands said “Copyright law must not hamper open science. The EU has made significant headway towards open access of research funded by European citizens. The proposed new rules would clearly impede further progress, threatening the visibility of Europe’s research".  Maria Rehbinder from the Association of European Research Libraries said “We really don’t want further paywalls on top of any research materials libraries have paid for already”. 

One of the high profile stories circulating the internet is that Article 13 would impact the creation and sharing of memes - not least as memes often use copyrighted images from popular films and TV shows. Global News reports "Pepe the Frog, the “Distracted Boyfriend” meme and Arthur’s balled-up fist are all under threat. So are reactions GIFs such as the one of a confused Zach Galifianakis, or the clip of Steve Carrell shouting ‘No!’ in The Office. EU lawmakers may inadvertently destroy the internet’s robust meme culture with a proposed law designed to fight online piracy. One article in the legislation would force online platforms such as Google, Facebook, YouTube and Twitter to automatically censor copyrighted content uploaded by anyone who isn’t licensed to share it." So called mash-ups and re-mixes have been given the same attention with their presumed demise highlighted. Matt made the point in the last CopyKat that a filtering and blocking system could lead to some major mistakes. Whilst the Dancing Baby vs Prince case is now settled, at the heart of that was ine question of whether the mother in question, Stephanie Lenz, could use fair dealing as a defence - or at least whether the rights owners (Universal Music took a lead) issuing the take down should have considered the doctrine before removing the video of the toddler dancing to Prince's music. As Matt argued "many mistakes will occur ....  a lot of content may be removed or blocked because of the system being unable to recognise what falls under exception or limitation, such as parody or quotation, and how they differ across the various Member States. Additionally, the proposed text by Commission and compromise texts of the Parliament and the Council does not contain any provision which will bring either clarity or consistency in defining “which Internet platforms would be required to comply with the provision, and which may be exempt”. 

AbovetheLaw give the example of  a simple mistakes - In 2013, Fox sent a take down notice against a book by Cory Doctorow because the book and one of Fox’s hit television shows shared the same name: Homeland. They add:  "Remember the Super Bowl ad Chrysler released this year, using the words of Martin Luther King, Jr. to sell a Dodge Ram truck? One viewer cleverly replaced the original audio of the ad, which highlighted the importance of service, with audio from another portion of the same MLK speech that instead criticized consumer culture, including a line calling out Chrysler by name. This version of the ad was flagged by YouTube’s content ID and taken down, but was later restored because it is obviously a fair use. The very fact that it was removed at all, though, demonstrates the inability of automated systems to determine whether a use is criticism, parody or some other non-infringing use."

Professorf Lessig
Back in August 2013 Lawrence Lessig filed a federal complaint after YouTube forced the Harvard University law professor and Creative Commons co-founder to take down a video of a lecture that featured people dancing to a copyrighted sound recording. Supported by the Electronic Frontier Foundation (EFF), Lessig said: “The rise of extremist enforcement tactics makes it increasingly difficult for creators to use the freedoms copyright law gives them. I have the opportunity, with the help of EFF, to challenge this particular attack. I am hopeful the precedent this case will set will help others avoid such a need to fight. The company who issued the take down issued an apology. 

“It’s a blunt instrument and it’s going to lead to lots of over-censorship,” Jim Killock, head of the U.K.-based Open Rights Group, told Global News. And he is not alone - numerous civil rights groups have pointed out that the proposed changes could be used to restrict freedom on the internet and could be used to censor content and sharing.   Communia, which advocates policies that expand the public domain and increase access to and reuse of culture and knowledge, and seeks to limit the scope of "exclusive copyright to sensible proportions that do not place unnecessary restrictions on access and use", issued a key recommendation to delete Article 13 from the proposal "as it addresses a problem that lacks empirical evidence confirming its existence. Article 13, as drafted by the Commission, would limit the freedom of expression of online users and create legal uncertainty that has the potential to undermine the entire EU online economy. As such it is unworthy of being included in a Directive proposal that is intended to modernize the ageing EU copyright framework".

InfoJustice was scathing on the automatic filtering proposals saying: "The upload filtering proposal stems from a misunderstanding about the purpose of copyright. Copyright isn’t designed to compensate creators for each and every use of their works. It is meant to incentivize creators as part of an effort to promote the public interest in innovation and expression. But that public interest isn’t served unless there are limitations on copyright that allow new generations to build and comment on the previous contributions. Those limitations are both legal, like fair dealing, and practical, like the zone of tolerance for harmless uses. Automated upload filtering will undermine both. What began as a bad idea offered up to copyright lobbyists as a solution to an imaginary “value gap” has now become an outright crisis for future of the Internet as we know it. Indeed, if those who created and sustain the operation of the Internet recognise the scale of this threat, we should all be sitting up and taking notice." 

Of course neither side wants to give ground: The recorded music sector's main lobby group, the IFPI, said Article 13 restores fairness to the digital market. It’s about looking out for workers in the creative industries, helping to secure them a future that is financially viable where we continue to benefit from their services" and a cross section of rights owners from the music, film, sports and television sectors (amongst others in the cultural and creative industries) have now sent a letter to MEPs pointing to "a cynical campaign from tech companies flooding the inboxes of MEPs with scaremongering that the copyright directive would be the end of the internet"  adding  "Please note that this is the 20th anniversary of their first claim that copyright provisions would break the internet. And it has never happened."

And the actual creators of music from across Europe are calling on MEPs to protect Europe’s status as a global hub for culture saying that the tech giants must pay fairly for content hosted on their platforms. Robert Ashcroft, Chief Executive of PRS for Music, said: “After three years of debate, one of the most controversial pieces of legislation ever to come before the European Parliament is about to go to the vote. This is about copyright and specifically about the rights of creators versus those of the Internet giants; it is about the way the Internet functions as a fair and efficient marketplace. It is a debate we must win if we want to secure our creative community into the next decade.” Jimbo Barry, producer and songwriter, known for co-writing hits for The Script, said: “I do worry about the sustainability of the professional music industry, as a songwriter. If copyright becomes free for the music that I write, and I don’t get paid in any sense for the music being used either on the radio or the platforms online, then logically, I won’t be able to sustain myself as professional. I hope that the fight for copyright for songwriters improves and that songwriters are just able to sustain the work that they love.

It will be left to MEPs to address the balance that is surely needed: “Creators and news publishers must adapt to the world of the internet as it works today,” rapporteur Axel Vossn MEP), said in a European Parliament Committee on Legal Affairs news release. “The Committee position aims to ensure that widely recognised and observed copyright principles apply to the online world, too.”

The legislation will now be debated in ‘trilogue negotiations’ where EU legislators and member states debate proposed legislation. The next plenary vote on the copyright review is due to take place on July 5th, and the final vote of the full plenary of the European Parliament is expected to take place in December. However, the decision of the JURI Committee which approved the proposed text, certainly increases the likelihood of Articles 11 and 13 becoming law - but it's going to be a battle!

Disclosure: The author represents a number of rights owners. Any opinions expressed by the author in this article are personal.

Wednesday, 27 June 2018

The COPYKAT: from Fallout Shelters to your local library

These days, a cursory search for “copyright” online will likely result in one thing more than any other: headlines about the [insert scary adjective here] draft for the Directive on Copyright in the Digital Single Market. It’s certainly something to keep an eye on, and the CopyKat has covered the DSM Directive here and here. But in other copyright news…

Is Warner Bro's Westworld game a blatant rip-off?

Bethesda Softworks is suing Warner Bros. and Fallout Shelter co-developer Behaviour Interactive over the recently released Westworld. Bethesda Softworks alleges that not only is the mobile game based on HBO’s TV series a “blatant rip-off” of Fallout Shelter, but that it also uses the same code as Fallout Shelter. The lawsuit, filed on 21 June in Maryland District Court, is a civil action for breach of contract, copyright infringement, unfair competition, and misappropriation of trade secrets.

a scene from HBO's hit show, Westworld
The original Fallout Shelter was released in 2015 for mobile devices, and is now available for play on Nintendo Switch, Windows PCs, PlayStation 4, and Xbox One. Fallout Shelter is a free-to-play simulation game, which has in-app purchases, where players build and manage a post-apocalyptic bunker full of workers (Variety). The Westworld game, which is currently available only on Android and iOS mobile phones, allows players to manage a virtual replica of the  theme park from HBO's hit Westworld TV show. The mobile game also features an “underground facility” that is similar to the vault in Fallout Shelter.

Bethesda accuses Warner Bros. of copying “the subtle sway, bounces, and minute movements in idle characters that give them and the scene a constant sense of motion and a distinctive feel as a result of unlawfully copying Bethesda’s code.” With these common elements discussed above in mind, Bathesda asserts that “there is more than a substantial similarity between Fallout Shelter and the Westworld mobile game.” 

Of course, questions of inspiration can be argued either way. Importantly for Bethesda’s case, both Fallout Shelter and the Westworld game share the same developer: Behaviour Interactive. The company, which is Canada's largest independent video game development studio, is also a named defendant in the claim, which states: 

“Warner Bros., sharing a similar consumer demographic, and recognizing Bethesda’s significant success in bringing its Fallout Shelter game to a broad audience on mobile devices, engaged and collaborated with Behaviour to develop a mobile app for its own science-fiction property, Westworld. To bring the Westworld mobile game to market, Behaviour and Warner Bros. utilized Bethesda’s intellectual property without authorization to develop a mobile game with the same or substantially similar gameplay experience as that provided by the copyrighted Fallout Shelter mobile game.”

The evidence continues to stack in Bethesda’s favour, with the publisher pointing out that the Westworld game even included the very same bugs or defects that were present in the early development stages of Fallout ShelterBethesda, which also publishes the popular FalloutThe Elder Scrolls, and DOOM games, is seeking an unspecified amount in damages from Warner Bros., and to have the Westworld game removed from app stores.

Social network, media company, host provider, neutral intermediary... what's in a name for YouTube?

Austrian commercial TV broadcaster ProSiebenSat1Puls4 has achieved a key victory in its four-year legal battle with YouTube. According to the Handelsgericht Wien (the Vienna Commercial Court) in its judgement of 6 June 2018, YouTube is not a neutral intermediary, but is rather jointly responsible for copyright breaches that take place on its video platform.

Puls4, a private broadcaster affiliated with the major broadcasting group ProSiebenSat.1, accused YouTube of complicity in copyright infringement. In 2014, Puls4 sued YouTube, arguing that the media giant had allowed Puls4’s stolen content to appear on the YouTube platform. YouTube responded by asserting the Host Provider Privilege set out in Article 14 of the E-CommerceDirective, which in certain situations exempts host providers like YouTube from liability for infringing activities by their users.

Austria's former Chancellor Christian Kern appears on Puls4 TV.
It is important to remember that the Host Provider Privilege only applies if the entity in question indeed qualifies as a “host provider” within the meaning of the E-Commerce Directive. This means that YouTube would have to prove it (a) does not have actual knowledge of illegal activity or information and, as regards claims for damages, is not aware of facts or circumstances from which the illegal activity or information is apparent; or (b) upon obtaining such knowledge or awareness, acts expeditiously to remove or to disable access to the information.

Speaking to German newspaper Der Standard, Puls4’s CEO Markus Breitenecker explained that if YouTube “leaves its neutral intermediary position and assumes an active role, which could provide it with a knowledge of or control over certain data, it cannot rely on the liability privilege in this respect. And that is exactly what has happened in this case.”

Although (as of 25 June) the official judgement has not been published, the court cited the YouTube’s “links, mechanisms for sorting and filtering, in particular the generation of lists of particular categories, its analysis of users’ browsing habits and its tailor-made suggestions of content.” This led the court to determine that YouTube was prohibited from “playing the role of a neutral intermediary.”

In a statement to The Local Austria, YouTube said it was studying the ruling and “holding all our options open, including appealing” the decision. Both sides have four weeks to petition the court before it issues its binding ruling. In the meanwhile however, YouTube noted that it takes protecting copyrighted work very seriously.

If the preliminary decision is upheld, YouTube must perform a content check upon upload, instead of simply removing copyright infringing content upon notification. In respect of this, the Viennese court stated that “YouTube must in future — through advance controls — ensure that no content that infringes copyright is uploaded.” YouTube began beta testing a feature called Copyright Match last month, which shows rights holders who have had their work stolen and lets them ask YouTube to delete the guilty party’s video.
Although Austrian case law is not binding for other EU member states, the Commercial Court’s judgment sets a precedent for denying Host Provider Privilege to YouTube under EU law. This may encourage similar decisions in the future which are based on the same line of argument.

As Breitenecker put it, “the media companies who call themselves social networks will have to recognize that they, too, have to take on responsibility for the content with which they earn their millions.” 

For creatives in California, a recent employment law case may raise concerns over copyright

A California court ruling from April has raised concerns regarding its potential impact on copyright ownership. In Dynamex Operations West, Inc. v. Superior Court of Los Angelesthe matter before the court was a wage dispute, which required the court to consider the standard to apply in determining whether workers should be classified as employees, or as independent contractors. 

Nowhere in the 85-page judgement is “copyright” or even “intellectual property” mentioned. 
However, in a state with so many media and software companies, the new ruling could affect whether a creator or a company gets to claim ownership as the original author of a work. In deciding if a worker is eligible for statutory employment protections, Dynamex replaced a complex multi-factor consideration with a simple three-part “ABC” test. Now, Californian companies are burdened with the requirement to prove that all three parts weigh against an employment relationship. 

What does this mean for copyright law? 
The rise of the gig economy, which is characterised by short-term contracts and freelance work, poses new questions for intellectual property ownership. To determine if someone is an employee for purposes of copyright authorship, American Federal courts currently use a test in the US Treasury Department’s Internal Revenue Service code. 

If, however, the courts start looking to the Dynamex case for guidance, people’s expectations might change. Speaking to Bloomberg Law, music industry lawyer Michael S. Poster explained: “If, under California law, a lot more people are going to be treated as employees rather than as independent contractors, chances are that a lot of their work product that they would have retained a copyright interest in might belong to their employer.” 

Although the Copyright Act of 1976 provides authors with initial copyright interests, under the work-made-for-hire doctrine, it is the employer that is considered to be the author. (Section 201(b)). On the other hand, if the author is an independent contractor or freelancer – rather than an employee – ownership is retained by the individual creator, unless there is a contractual agreement to the contrary. 

For participants in the gig economy, the Dynamex ruling could simply prompt media and software companies to hire fewer independent contractors, and instead only hire people as employees. Although the copyright implications of Dynamex are unknown, the decision underscores the need for employers and workers alike to ensure that any contract for services includes a carefully drafted intellectual property rights clause – especially for those in creative industries.

And finally, for those of us still using our local library…

The Digital Economy Act 2017 (Commencement No 6) Regulations 2018 (SI 2018/690) have passed and will come into force this week in England, Wales and Scotland. The regulations give effect to section 31 (lending of e-books by public libraries) of the Digital Economy Act 2017. This impacts the Public Lending Right scheme, which in the United Kingdom is a programme administered by the British Library intended to compensate authors for the potential loss of sales from their works being available in public libraries.

The new section amends the definition of "lent out" in the Public Lending Right Act 1979 (PLRA 1979) thereby extending it to “communication by means of electronic transmission to a place other than library premises.” Being “lent out” now captures the remote lending of e-books and audio-books, resulting in the extension of the public lending right under the PLRA 1979 to remote lending. The provision also amends the Copyright, Designs and Patents Act 1988. 

Copyright in an e-book or e-audio-book within the public lending right scheme is not infringed when borrowed through a public library, provided that the e-book or e-audio-book in question has been lawfully acquired by the public library. Additionally, the lending must comply with any purchase or licensing terms to which the book may be subject.