A CANADIAN POLICY FRAMEWORK FOR TECHNOLOGICAL PROTECTION MEASURES

Charles MorganMarch 23, 2007

Musical Myopia, Digital Dystopia: New Media and Copyright Reform

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Outline

1. Context• Massive shift in technology has fundamentally altered the

underpinnings of copyright law2. What should we do?

• Meet our WIPO commitments• Respect the Canadian copyright policy framework• Implement the Canadian policy framework for e-commerce• Act in a manner that is consistent with/respectful of

concerns of our key trading partners by adopting analogous TPM rules

3. What should we not do? • Adopt Bill C-60 (as it was): weakest protection in the world• Ignore either rightsholder's or user's concerns by forgetting

the "public interest" • Undercut a TPM protection regime by implementing overly

broad, untargetted exemptions

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Context

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1. Context• Individuals are both consumers and

global publishers of digital content• Pirates hack through encryption,

pick digital locks to release digital content

• An “arms race” between those who implement TPM and those who overcome them

• Massive technological change creates an imbalance in traditional copyright system (worldwide)

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Context

• In 2005, BitTorrent accounted for 35 percent ofall the traffic on the Internet -- morethan all other peer-to-peer programscombined -- and dwarfs mainstreamtraffic (e.g. web pages)

• Over six months of surveying,CacheLogic found that BitTorrentaccounted for 53% of all peer-to-peernetwork traffic.

• Digital content is “free”

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What should we do?

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a. Meet our WIPO commitments

• Article 11 of the WCT and Article 18 of the WPPT require:

• Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention and that restrict acts, in respect of their works [sound recordings], which are not authorized by the authors concerned or permitted how by law.

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Meet our WIPO Commitments

• There is a discretion as to how the Treaties can be implemented. Stevens v Sony [2005] HCA 58 (6 October 2005). But this is not unfettered.

• The preamble to the WIPO Treaties makes it clear that the protection is to be provided “in a manner as effective and uniform as possible” emphasizing “the outstanding significance of copyright protection as an incentive for literary and artistic creation”.

• Limitations (1) must meet minimum standards set out in Treaties e.g. provide adequate protection and effective legal remedies, and (2) must be effective to create incentives for authors.

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b. Respect the Canadian copyright policy framework

• The objective of copyright is not a zero sum game between the rights of rights holders and users

• Copyright is concerned with balancing the public interest in the encouragement and dissemination of the works and “to prevent someone other than the creator from appropriating whatever benefits may be generated.” Théberge v. Galerie d’Art du Petit Champlain Inc., [2002] 2 S.C.R. 336

• The means of achieving the proper balance is one that has changed, and continually needs to be re-evaluated from time to time, in response to technological change and to reflect international developments.

• Parliament has the right to establish the appropriate balance.

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The Canadian Copyright Framework• Is free good?

• What really benefits consumers, authors and rights holders?

• There is a direct link between protecting intellectual property rights and innovation. See, EC, Proposal for a Directive of the European Parliament and of the Council on measures and procedures to ensure the enforcement of intellectual property rights, 30 January 2003, COM (2003) 46 final

• “The Copyright Act (the Act) is an important marketplace framework law and cultural policy instrument that supports creativity and innovation. Many sectors of the economy, for example, those dealing with arts and culture, communications and broadcasting, education and research, either rely on or are affected by copyright.” Statement, Government Statement on Proposals for Copyright Reform (March 2005)

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Canadian Copyright Policy Framework• Protecting rights holders from having others

unfairly appropriate their works is in the public interest.

• Thou shalt not steal!• The “capacity of the Internet to disseminate

‘works of the arts and intellect’ is one of the great innovations of the information age.” “Its use should be facilitated rather than discouraged, but this should not be done unfairly at the expense of those who created the works of arts and intellect in the first place.” SOCAN v. Canadian Assn. of Internet Providers 2004 SCC 13

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Implement the Canadian Copyright Policy Framework• “Intellectual property laws originated in order to

protect the promulgation of ideas. Copyright law provides incentives for innovators -artists, musicians, inventors, writers, performers and marketers - to create. It is designed to ensure that ideas are expressed and developed instead of remaining dormant. Individuals need to be encouraged to develop their own talents and personal expression of artistic ideas, including music. If they are robbed of the fruits of their efforts, their incentive to express their ideas in tangible form is diminished.” BMG Canada Inc.v John Doe 2005 FCA 193

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c. Implement our policy framework for e-commerce

• Implement our policy framework for e-commerce (i.e. removing barriers to e-commerce) as applicable to digital copyright• PIPEDA (addresses privacy concerns related

to data flow)• Internet Sales Template (addressed

consumer protection concerns)• e-commerce laws (establishes legal certainty

and removes red tape)• now: implement missing link: TPM

protections (i.e. promotion of commerce in digital works requires that we ensure that rightholders are compensated)

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Acknowledge Privacy Concerns• DRM systems give users choices and enable

copyright holders to be paid for uses of works.• PIPEDA was passed to promote e-commerce

knowing that personal information was going to be collected, used and disclosed.

• Are there differences between collection of information for use in DRM systems and other areas, e.g., libraries, rewards programs, hotels, book and record clubs, retailers, credit cards, smart cards, GIS systems etc?

• Where do the criticisms come from and are they addressed by PIPEDA?

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Avoid “Digital Lock-up”

•“§ 1201. . . involves genuine tradeoffs: Congress made a judgment that technological protection would foster innovation in new content delivery mechanisms in order to provide consumers with a range of new options for experiencing copyrighted works, recognizing that technological controls might diminish the convenience of non-infringing uses. So far, the balance that Congress struck appears justified. Section 1201 has provided substantial benefits to consumers by encouraging the development of innovative new business models for delivering sound recordings, motion pictures, books and other copyrighted works to consumers.”

•June Besek, “Anti-Circumvention Laws and Copyright: A Report From the Kernochan Center for Law, Media and the Arts”, 27 Colum. J. L. & the Arts 389, 446-66 (2004) at P. 512-513.

•In 2003 the US Copyright Office examined whether technological measures interfered with fair use and other limitations to copyright. It strongly defended the use of these measures and found that on balance they expanded product availability and consumer choice.

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d. Act in a manner that is consistent with our key trading partners

• By adopting TPM rules that:

• cover circumvention of access control TPMs • cover trafficking in access control TPM

circumvention tools• cover trafficking in copy control TPM

circumvention tools • provide for criminal sanctions for

particularly egregious or damaging activity

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2. What should we not do?

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2.What should we not do?

• Adopt Bill C-60 (as it was): weakest protection in the world (amongst our major trading partners)

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Is Bill C-60 the Right Approach?

• No “adequate legal protection and effective legal remedies” against the circumvention of TPMs.

• Clearly out of step with – and fall far below – international trends and developments in the international community.

• No compliance with the WIPO Treaties.

• No remedies to address many of the well- known circumstances of circumvention, let alone those that can be imagined and will be dreamed up by “hackers” and “crackers” in the future.

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How Flawed was Bill C-60?

• If amendments were not made to the TPM provisions Canada would have provided one of the weakest - if not the weakest - TPM protection in the world to its creators and rights holders.

• No other G8, EC country or other industrialized country had such low levels of protection.

• Countries with higher levels of protection would include: United States, Australia, EU member states such as Belgium Cyprus, Czech Republic, Denmark, Finland France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Portugal, Slovak Republic, Slovenia, The Netherlands, United Kingdom.

• Other countries Belarus, Bulgaria, CAFTA members- Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic - and Ecuador, Indonesia, Paraguay, Peru, Moldova, and Ukraine.

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RealNetworks, Inc. v. Streambox, Inc., 2000 WL 127311 (W.D. Wash. 2000)• RealNetworks obtains injunction in

US under DMCA against Streambox that distributed VCR product that enables end-users to circumvent access control TPM (“Secret Handshake“) and copy control TPM ("Copy Switch”).

• Circumvention permitted users to access and download copies of RealMedia files that are streamed over the Internet.

• Without the security measures afforded by RealNetworks, electronic methods of distribution could not succeed. End-users could make and redistribute digital copies of any content available on the Internet, undermining the market for the copyright original.

• Bill C-60 does not contain anti-trafficking provisions. So there would be no remedy against Streambox.

• A consumer’s use of VCR to circumvent the “Secret Handshake” would not be caught, as it is an access control TPM.

• The circumvention of the “Copy Switch” copy control TPM would not be caught unless it could be proved that it was done for the purpose of infringement.

• Using Copy Switch to facilitate infringement by others would not be caught either.

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Universal City Studios, Inc. v. Corley, 273 F.3d 429, (2nd Cir.2001)

• Motion picture studios brought motion to enjoin website owners from posting or linking to “DeCSS” (a program that decrypts digitally encrypted movies (DVDs) protected with CSS (content scrambling system).

• The distribution of DeCSS enables the circumvention of CSS and the illegal copying and use of decrypted movies.

• Bill C-60 contains no provisions prohibiting trafficking in anti-circumvention tools.

• Bill C-60 does not protect against the circumvention of the access control technology of CSS.

• Claims against users under S.34.02(1) would fail unless it could be proved that the circumvention was for the purpose of infringement. The circumventing of the TPM by itself would not be a violation of S.34.02(1).

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Stevens v Kabushiki Kaisha Sony Computer Entertainment & ORS [2005] HCA 58

• Sony games contain an access code TPM on each CD Playstation game that is read by a chip in the Sony Console.

• This device prevents unauthorized (pirated) CDs from being made as they won’t play on Sony consoles.

• Stevens sold “mod chips” and installed them on Playstation consoles effectively overcoming Sony’s access control TPM.

• Bill C-60 does not cover the trafficking of circumvention tools such as “Mod Chips”.

• Individual consumers using “mod chip” game enhancers to circumvent the access control TPM in games would not violate S.34.02(1) even if done for the purpose of infringement or facilitating infringement as an access control TPM is not a “technological measure” as that term is defined in S.1(2).

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U.S. v. Elcom Ltd., 203 F.Supp.2d 1111 (N.D.Cal. 2002) • ElcomSoft was criminally

prosecuted under the anti-trafficking provisions of the DMCA for selling an anti-circumvention tool called the Advanced eBook Processor ("AEBPR").

• It allowed a user to remove the copy control TPM from electronic books distributed using Adobe Acrobat eBook Reader.

• This enabled the book to be easily reproduced and electronically distributed as a naked PDF file.

• Bill C-60 does not have any criminal provisions.

• Bill C-60 also has no prohibitions against trafficking in anti-circumvention tools.

• The use of AEBPR by a consumer would not infringe S.34.02(1) unless it could be proved that the user did so for the purpose of infringement.

• The circumvention of the copy control TPM by itself would not be infringing, nor would using the circumvented ebook for purposes not paid for by the consumer.

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b. What is Needed?

• Protection against “preparatory acts” of trafficking in access control and copy control circumvention tools and services.

• Protection against acts of circumvention including access control circumvention.

• Effective legal remedies including criminal sanctions in serious cases.

• Must protect Canadian authors and rights holders to enable development of new business models.

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c. What should we not do?

• Undercut a TPM protection regime by implementing overly broad, untargetted exemptions (look to Singapore agreement as example of reasonable language in this regard)

• E.g.: circumvention allowed if intended for “fair use”!

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