Using Clean Hands to Justify Unclean Hands: How the Emergency Exception Provision of the SCA Misapplies an Already Controversial Doctrine
By Brendan J. Coffman* A pdf version of this article may be downloaded here. INTRODUCTION A man sits in his apartment in a major United States city checking his email. He may or may not be a U.S. citizen, and may or may not be associated with a significant international organization. The government’s intelligence agencies are not aware of the man, and local police officials have no overt reason to suspect anything abnormal or threatening. His email is transmitted and stored by a major electronic communications service provider, and his private messages on the server contain information vital to his plot—to attack a major U.S. city. In the adjacent apartment, a man sends an email to a friend discussing his desire—mostly imaginary, but frighteningly realistic—of assaulting his female neighbor. The friend’s wife intercepts the email. The wife does not believe the man would follow through on his desires, and goads him on in response. Much like the case above, the police have no reason to suspect any dangerous intention from this man. In a third apartment lives a naturalized man originally of Arab citizenry. He is a stand-up citizen, but a local police officer distrusts the man, and suspects the man of plotting an attack. The police officer has no information to justify this premonition, and cannot effectuate a warrant. But he believes that if he had access to the man’s email and other electronic communications, he could prove his suspicions. Each man’s email is stored with an internet service provider (“ISP”). In which of these circumstances could the ISP choose to voluntarily violate the privacy of one of the men and provide the government with the information contained within his email communications? In which of these circumstances should the ISP choose to disclose the information? Furthermore, when must the ISP disclose this information? Lastly, what does this mean in terms of Fourth Amendment privacy rights and the authority of law enforcement professionals? The government’s encouragement—and even reliance—on third-party monitoring of citizens is not a new phenomenon. As technologies have continued to advance, and telecommunications companies have expanded their sphere of influence over the day-to-day operations of citizens’ lives, a natural partnership has arisen between the government and the telecommunications industry. [FN1] But 9/11 and the subsequent War on Terror [FN2] have introduced a new level of urgency to the government’s need for information, [FN3] thus straining the relationship between the government and telecommunications companies. [FN4] While telecommunications companies often seek to help the government for both patriotic and commercial reasons, the fear of lawsuits [FN5] and customer outrage requires them to pursue a more tempered approach to disclosure of customer information. Congress passed the Stored Communications Act (“SCA”) [FN6] in 1986 to limit electronic communications service providers’ ability to disclose private information, and regulate the government’s ability to compel these disclosures[FN7] The SCA requires the government to follow specified legal procedures to access private communications. [FN8] These procedures become increasingly more burdensome for the government as the information it seeks is more private and protected. [FN9] The SCA also contains a recently amended provision governing the voluntary disclosure of private information by Providers in the case of an emergency. [FN10] The emergency exception allows the Provider to disclose the contents of a customer’s communication “to a governmental entity, if the provider, in good faith, believes that an emergency involving danger of death or serious physical injury to any person requires disclosure without delay of communications relating to the emergency.” [FN11] The “clean hands” exception allows the government to introduce evidence into trial that was illegally obtained by a third party when the government did not play any role in obtaining that information. [FN12] The clean hands exception stands in contrast to the exclusionary rule in that it values the state’s interest in prosecuting the defendant more than the defendant’s right to privacy. [FN13] It is vital to remember that the clean hands exception only applies in incidents in which the government played no part in the obtaining of the information.[FN14] While the very existence of the “clean hands” exception has split federal circuits, [FN15] Congress never clarified its legislative intent. However, the rationale underlying the clean hands exception is present in Congressional amendments to the SCA. This Comment argues that although amendments to the voluntary disclosure provisions of the SCA are ostensibly an update and ratification of previously existing standards for the controversial ‘clean hands’ exception, the SCA’s emergency exception extends the rationale far beyond the boundaries of the clean hands exception. This difference is markedly different from the “lucky break” fortuitous logic implicated within the clean hands exception. [FN16] This Comment begins with a primer on the laws regulating third party surveillance and its intersection with government access to information obtained by a third party. Part I provides an overview of the Fourth Amendment, its application to electronic surveillance, and a discussion of the exclusionary rule governing the admissibility of evidence obtained in violation of the Fourth Amendment. Part I then assesses the Sixth Circuit’s clean hands exception, including an explanation of the rationale underlying the exception and a discussion of the primary cases invoking the doctrine. Part I next addresses the inadequacies of the Fourth Amendment right to privacy and exclusionary rule pertaining to its application to electronic information as a result of the business records cases. Part I concludes with an overview of Congressional response to these inadequacies through the enactment of several privacy-driven statutes, most notably the Stored Communications Act,[FN17] with particular focus on the compulsory, voluntary, and emergency disclosure provisions aimed at the telecommunications industry in 18 U.S.C. §§ 2702 and 2703. Part II examines connections between the clean hands exception and the amended portions of the SCA. Secondly, Part II conducts an analysis of the deterring factors facing ISPs in each instance, and concludes that the modified voluntary disclosure provisions in Section 2702(b)(8) are less constrained than its clean hands counterpart because of the lack of a legitimate scheme to deter abuses. Part II concludes with a forecast of some of the difficulties that may arise in applying the SCA as a result of these similarities, and argues that the potential for encouraged abuses of the voluntary disclosure provisions may overextend the SCA’s application. Finally, Part III demonstrates this vulnerability through an application of SCA and clean hands exception logic to the hypothetical scenarios presented at the onset of this Comment. I. BACKGROUND A. Stored Communications and Internet Service Providers The growth and pervasion of the internet in the day-to-day lives of Americans cannot be overstated. [FN18] In the 10 years between 1997 and 2007, the percentage of American households containing computers with internet access has grown from 18% to 61.7%. [FN19] The ability to communicate across the internet, particularly though e-mail, has been a major factor in the growth of the internet. [FN20] The structure of the internet, and the fact that we communicate through its unique structure, has a significant effect on both the Fourth Amendment privacy protections of these communications as well as the subsequent regulation of the internet communication industry. [FN21] Individuals using the internet do not communicate directly with another person. Instead, they transmit data across a network and through an ISP, who then routes the data to the desired endpoint. [FN22] This voluntarily disclosure of information to a third party invokes a body of controversial Fourth Amendment law. [FN23] Internet communication is further complicated by another unique aspect of electronic communications. ISP’s generally store records of all communications passing through their servers. [FN24] This further distinguishes e-mail from telephonic conversations, in which the communications company merely transmits the information over their line. ISPs often utilize the communications in the emails passing through their servers to accumulate information about the tendencies and profiles of their customers, as well as to protect their network from any harm that might be caused by customers. [FN25] B. The Fourth Amendment and Protection of Personal Privacy The Fourth Amendment demands that all searches and seizures be reasonable. The Fourth Amendment provides:
The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized. [FN26]The Fourth Amendment represents the Founders’ belief that personal privacy was fundamental to the success of the American polity. [FN27]Some commentators have posited that the Fourth Amendment’s protection of privacy rights is America’s “most prized possession” [FN28]and the element of the Constitution that most directly affects and influences the lives of Americans. [FN29] The Fourth Amendment’s Warrant Clause, including the requirement that a judge authorize a police officer’s determination of probable cause, provides a substantial check on the Executive’s ability to interfere with the personal privacy rights of the citizens during the course of criminal investigation. [FN30]However, the application of the Fourth Amendment to surveillance, and particularly electronic surveillance, is not as clear. [FN31] 1. The Exclusionary Rule, Evidence Suppression, and the Good Faith Exception Concerns over individual privacy complications in electronic surveillance have their roots in the Fourth Amendment exclusionary rule, which has been used to deter police officers from engaging in unconstitutional searches. [FN32] The exclusionary rule excludes or suppresses evidence obtained in violation of an accused person’s constitutional rights. [FN33] For example, under the exclusionary rule, if police conduct a search without a warrant or probable cause, or obtain a warrant through misinformation, and evidence obtained by the search is suppressed. [FN34] The exclusionary rule applies in both state and federal courts. [FN35] While some argue that this rule is a disservice to the criminal justice system, it is one of the most fundamental deterrents to illegal search and seizure in the American criminal justice system. [FN36] The Supreme Court introduced an important exception to the exclusionary rule in United States v. Leon: the “good faith” exception. [FN37] In Leon, the Court held that when police officers discovered evidence while acting on a defectively administered warrant the evidence from trial because the officers’ reliance on the correct administration of the warrant had been made in objectively reasonable good faith. [FN38] The Court reasoned that that the exclusionary rule is designed to deter police officers, as opposed to a magistrate who issues a warrant. [FN39] The Court then concluded that excluding the evidence in this case would not serve the purpose behind the exclusionary rule. [FN40] As a result, a balancing test has evolved to determine the application of the exclusionary rule in the instance of a good faith police error in which the court considers the nature and intent of the Fourth Amendment violation against the applicability and necessity of tangible evidence. [FN41] The Leon court enumerated four instances in which the good faith exception will not apply to avoid suppression of evidence through the exclusionary rule. First, the good faith exception does not apply if police officers provide misleading or untrue information to a magistrate. [FN42] Secondly, the good faith exception does not apply if law enforcement officials have reason to know that a magistrate has “wholly abandoned his judicial role.” [FN43] Thirdly, the good faith exception does not apply if a warrant is completely unsatisfying of the probable cause standard to the extent that a reasonable police officer should know it is invalid. [FN44] Lastly, the good faith exception will not apply if the warrant is facially defective. [FN45] This rule and series of exceptions reinforces the notion that the Fourth Amendment prohibition of unreasonable search and seizure is at its heart a balancing test. [FN46] 2. The Fourth Amendment and Electronic Communications Historically, the Executive Branch asserted its right to conduct warrantless searches of electronic communications in both the domestic and national arenas as part of its task to protect national security. [FN47] Some have argued that the Founders simply did not contemplate the possibility of electronic communications, and as such, Fourth Amendment privacy concerns should be limited to criminal investigations and not applied to civil litigation. [FN48]Initially, the Executive faced very little resistance in its broad application of Executive authority in electronic surveillance due to the 1928 Supreme Court decision Olmstead v. United States. [FN49] In Olmstead, police wiretapped defendant’s phone without a warrant because they suspected he was violating the National Prohibition Act. [FN50] The Olmstead court interpreted the Fourth Amendment’s privacy protection very narrowly and very literally, holding that its protections extended only to physical searches and seizures. [FN51] Since the police did not detain the defendant, enter his home in any manner, or seize any of his material objects, the court held that the police did not violate the Fourth Amendment. [FN52] The limited scope of constitutional privacy protections set forth in Olmsteadsuffered gradual erosions between 1928 and 1967, albeit outside the arena of electronic surveillance. [FN53] However, it was not until 1967 when the Supreme Court, in two landmark decisions, set the standard for individual privacy protection in the face of government electronic surveillance. First, in the June 1967 decision Berger v. New York, [FN54] the Court declared unconstitutional a New York statute that permitted law enforcement to engage in wiretapping based merely on the reasonable ground that the wiretap may obtain evidence of an unspecified crime. [FN55] The Court held that the New York statute lacked the “requirement for particularity in the warrant as to what specific crime has been or is being committed” and reversed defendant’s conviction. [FN56] The Berger Court included a dissent from Justice White that foreshadowed the uncomfortable intersection between electronic surveillance for the purposes of law enforcement and surveillance in the name of national security. [FN57]Justice White attached an appendix to his opinion entitled “Excerpt from ‘The Challenge of Crime in a Free Society,’ A Report by the President’s Commission on Law Enforcement and Administration of Justice, at 200-203 (1967).” [FN58] The excerpt highlights the numerous difficulties experienced by the executive in administering surveillances, and calls upon Congress to “enact legislation dealing specifically with wiretapping and bugging.” [FN59]Notably, the Commission Report suggested “All private use of electronic surveillance should be placed under rigid control, or it should be outlawed” and limited the Report by explaining “matters affecting the national security not involving criminal prosecution are outside the Commission’s mandate, and nothing in this discussion is intended to affect the existing powers to protect that interest.” [FN60] Just six months later in 1967, the Supreme Court further expanded the constitutional right to privacy in Katz v. United States. [FN61] In Katz, a man inside a public phone booth engaged in illegal wagering over the telephone.[FN62] Agents of the Federal Bureau of Investigation (“F.B.I.”) had placed recording devices just outside of the phone booth that it used to listen to the man’s conversations, and introduced the recordings into evidence. [FN63] The District Court for the Southern District of California convicted defendant on eight counts of transmitting wagering information, and the Ninth Circuit Court of Appeals affirmed the conviction and rejected the argument that the F.B.I. obtained the evidence in violation of the Fourth Amendment. [FN64] The Supreme Court reversed, holding that Fourth Amendment’s privacy protections extended to electronic surveillance and phone conversations specifically.[FN65] Additionally, through Justice Harlan’s concurring opinion, Katzestablished a two-part test for whether an individual has an expectation of privacy that, when violated, can result in the exclusion of evidence. The test finds an expectation of privacy if: (1) the individual had a subjective expectation of privacy, and (2) society recognizes this subjective expectation of privacy as reasonable. [FN66] The importance of this case is twofold: first, it reinforced the Court’s understanding of an implied right to individual privacy in the Constitution, and, secondly, it demonstrated the Court’s willingness to engage in a balancing test when comparing this individual right to privacy against the government’s interest in surveillance. [FN67] The Court’s narrowing of Katz is also important. Much as the Court did just six months earlier, [FN68] the Katz decision included two caveats, both pertaining to national security concerns. [FN69] First, Justice Stewart’s majority opinion included a footnote explaining that the question of national security is not an issue presented to the court. [FN70] Secondly, in a brief concurrence, Justice White reiterated his interpretation that the warrant requirement should not extend to national security matters in which the President and/or the Attorney General have “authorized electronic surveillance as reasonable.” [FN71]Although not explicitly, Justice White appeared to be calling upon Congress to act with regard to the distinction between electronic surveillance for law enforcement purposes and for national security purposes. [FN72] C. Congress Responds to the Inadequacies of Katz 1. Enactment of Title III Congress promptly acquiesced to Justice White’s subtle suggestion from Katz, and passed Title III of the Omnibus Crime Control and Safe Streets Act of 1968, [FN73] widely referred to as Title III. [FN74] Title III embraced the holdings of Katz and Berger by codifying the rights to privacy in oral communications [FN75] and wire communications. [FN76] Title III requires that if the government wishes to begin oral or wire surveillance, it must obtain a warrant before beginning surveillance. [FN77] Additionally, Title III establishes a uniform standard under which the government may pursue a warrant. [FN78]Specifically, to obtain a warrant, the government must demonstrate that it (1) has probable cause against the target of the surveillance; [FN79] (2) has a special need to conduct electronic surveillance; [FN80] and (3) will minimize the interception of innocent communications. [FN81] Furthermore, a target of electronic surveillance under Title III has the right to learn about the surveillance and challenge the probable cause against him, and may demand the exclusion of any evidence obtained against him if the government has violated Title III in obtaining the evidence. [FN82] Title III extends to third party intrusion on individual privacy through a broad application of the exclusionary rule as the remedy available. The evidentiary prohibition portion of Title III stipulates the following: [FN83]
Whenever any wire or oral communication has been intercepted, no part of the contents of such communication and no evidence derived therefrom may be received in evidence in any trial, hearing, or other proceeding in or before any court, grand jury, department, officer, agency, regulatory body, legislative committee, or other authority of the United States, a State, or a political subdivision thereof if the disclosure of that information would be in violation of this chapter.In applying an exclusionary remedy to a victim of illegal interception, Congress maintained Title III’s connection to the Fourth Amendment common law remedy. [FN84] For a short time after its enactment, individual privacy with respect to electronic communications fell largely under the purview of Title III. [FN85] Although not explicit in the statute’s language, Title III embraced Justice Harlan’s “reasonable expectation of privacy” test from Katz. [FN86] While Title III extended to the suppression of oral or wire communications that were intercepted by third parties, Title III did not account for the fact that individuals voluntarily share information with third party telecommunications companies during the course of normal interaction. [FN87] It soon became clear that the Fourth Amendment did not protect this information either, when the Supreme Court narrowed the scope of the Fourth Amendment’s privacy protections with regard to this voluntarily shared information in two landscape-altering cases. 2. Miller, Smith, and the Court’s Narrowing of Fourth Amendment Privacy Protections In 1976 and 1979, the Supreme Court decided United States v. Miller [FN88]and Smith v. Maryland, [FN89] commonly referred to as the “business record” cases. [FN90] The holdings of Miller and Smith significantly marginalized Katz.[FN91] Specifically, these cases jointly established that the temporary-yet-voluntary possession of an individual’s information by a third party precluded a legitimate expectation of privacy in that information, thus precluding application of the exclusionary rule to that information. [FN92] In Miller, agents from the Bureau of Alcohol, Tobacco, and Firearms subpoenaed defendant’s bank account to demonstrate that he was engaged in several illegal acts, including prohibition-related offenses and tax fraud.[FN93] The government used the defendant’s bank account information to convince the district court to convict him after denying his motion to suppress the bank account information from evidence on Fourth Amendment grounds.[FN94] The Court of Appeals for the Fifth Circuit reversed the conviction, citing Boyd v. United States [FN95] and determining that the government’s subpoena of the defendant’s bank account information was a Fourth Amendment violation. [FN96] The Supreme Court reversed, holding that the defendant did not have a reasonable expectation of privacy with regard to his bank records because he voluntarily disclosed the records to the bank. [FN97] The Court stressed that the Fourth Amendment “does not prohibit the obtaining of information revealed to a third party and conveyed by him to Government authorities.” [FN98] Just three years later, the Court fortified its holding in Miller by holding that an individual does not have a legitimate expectation of privacy with regard to the phone numbers he dials from his house. [FN99] In Smith v. Maryland, the police requested and the phone company agreed to install a pen register[FN100] at the telephone company’s offices that recorded the numbers the defendant dialed from home. [FN101] The Smith Court applied both prongs of Justice Harlan’s Katz test to determine whether the Fourth Amendment applied to the phone numbers that the defendant dialed. First, the Court concluded that a telephone user should not have a subjective expectation of privacy in telephone numbers dialed because “[a]ll telephone users realize that they must ‘convey’ phone numbers to the telephone company.” [FN102] Secondly, the Court reasoned that even if the defendant had a subjective expectation of privacy, such expectation is not one that the society recognizes as reasonable.[FN103] The Court held that the telephone user “assumed the risk” that the government would obtain these telephone numbers, and reiterated its stance in Miller that a person does not hold a legitimate expectation of privacy in information he turns over to a third party. [FN104] As it turns out, Smith was just the beginning of widespread confusion when applying Fourth Amendment principles to developing technologies. D. The Clean Hands Exception: An Avenue for Introducing Illegally Obtained Evidence into the Courtroom Early legislative efforts in response to the business records cases granted a broad range of individual privacy protections. [FN105] However, one important instance of discord centered around whether the government should be allowed to introduce into evidence information obtained illegally by a third party but which the government did not play a part in obtaining. [FN106]Commonly referred to as the “clean hands” exception, the question is one that continues to split federal circuits. [FN107] The most modern seminal “clean hands” case is United States v. Murdock, [FN108] in which the Sixth Circuit held that the government was allowed to introduce evidence of a man’s criminal conduct that was recorded illegally by the man’s wife. [FN109] 1. Factual and Procedural Background In Murdock, a wife became suspicious of her husband’s dealings, both personally and professionally. [FN110] As a result, she began recording conversations from the family business telephone line on an extension of the business’ telephone line connected to the family’s home. [FN111] After seeing a story in the local paper about the negotiations between the school board and a local dairy, the wife became convinced that her husband, who was president of the school board, was acting improperly. [FN112] She went back and listened to her recordings, and found evidence of her husband accepting a bribe from the local dairy. [FN113] The wife forwarded the information to a competing dairy, who in turn forwarded the information to the local newspaper.[FN114] An investigation ensued, and the government eventually used this information to charge the husband for income tax evasion because he failed to report the bribe as income. [FN115] The husband then moved to suppress the evidence under Section 2515 of Title III, [FN116] which provides for the exclusion of evidence obtained through illegal surveillance. [FN117] The district court denied the defendant’s motions to suppress on two grounds. First, the court held that the statutory prohibitions of Title III did not apply in this case because of the business line extension in the family’s home. [FN118] The Court explained that Sections 2510(4) and 2510 (5) provide an exception to the statutory prohibition of electronic surveillance that occur in the place of business and during the ordinary course of business. [FN119] The Sixth Circuit reversed this holding, yet conceded that the wife’s monitoring of her husband was in fact a violation of Section 2515 of Title III. [FN120] Second, the district court held alternatively that the exclusionary remedy for a Title III violation did not apply to the government “where it played no part in the interception of the conversation.” [FN121] The Sixth Circuit agreed with this conclusion, and affirmed the lower court’s decision that the government was entitled to a “clean hands” exception to the Title III exclusionary rule. [FN122] 2. The Court’s Rationale The Sixth Circuit’s holding in Murdock rested on the fact that the government did not play a part in the illegal electronic recording activity. [FN123] This led the court to reason that the public policy interest in allowing the evidence into court outweighed an interpretation of the applicable law in favor of the defendant. [FN124] In reaching this conclusion, the Sixth Circuit analyzed competing theories of Title III and Fourth Amendment jurisprudence. First, the court reanalyzed the legislative history of Section 2515, and determined that the statute only aimed to protect victims of unlawful interception from the perpetrator’s use of the information against the victim.[FN125] In so holding, the Murdock court distanced itself from United States v. Vest, [FN126] the initial case to invoke the clean hands exception. [FN127] In Vest, the government prosecuted a man for acting as a conduit in the bribery of a Massachusetts police officer. [FN128] A criminal defendant made an illegal recording of his payment to a Boston police officer as part of a bribe to ensure a lenient sentence. [FN129] When the police officer claimed that he had not received the payment, the defendant turned over the recording to the authorities. [FN130] The government attempted to introduce the recording as evidence against the police officer. [FN131] However, the First Circuit rejected the government’s argument. [FN132] The court relied on the 1972 Supreme Court case Gelbard v. United States [FN133] to demonstrate Title III’s broad implications regarding fundamental privacy rights, and reiterated the finding that “the protection of privacy was an overriding congressional concern . . . and that secton 2515′s importance as a protection for the victim of an unlawful invasion of privacy could not be more clear.” [FN134] The Gelbard court relied on a 1968 Senate Report supplementing the passage of Title III, which read in pertinent part: [FN135]
Virtually all concede that the use of wiretapping or electronic surveillance techniques by private unauthorized hands has little justification where communications are intercepted without the consent of one of the participants. No one quarrels with the proposition that the unauthorized use of these techniques by law enforcement agents should be prohibited. . . . Only by striking at all aspects of the problem can privacy be adequately protected. The prohibition, too, must be enforced with all appropriate sanctions. Criminal penalties have their part to play. But other remedies must be afforded the victim of an unlawful invasion of privacy. Provision must be made for civil recourse for damages. The perpetrator must be denied the fruits of his unlawful actions in civil and criminal proceedings. Each of these objectives is sought by the proposed legislation.The Vest court also based its conclusion on the grounds that the government should not receive a clean hands exception when prosecuting a case in which the government would not have been able to receive a wiretap warrant.[FN136] A Title III warrant for electronic surveillance is only available when an appropriate magistrate determines that such surveillance will lead to evidence of an enumerated crime. [FN137] Perjury is not one of the enumerated crimes, and the police therefore would not have been able to obtain a wiretap to demonstrate the police officer’s perjury. [FN138] The Vest court’s rationale for rejecting a clean hands exception has most been embraced more recently by the Third Circuit in In re Grand Jury. [FN139] The Third Circuit, in relying on Vest and explicitly rejecting Murdock, concluded that refusing to suppress the evidence might have been plausible had the court interpreted a conflict between the plain statutory reading of Section 2515 and available legislative history. [FN140] However, the court found no conflict, and emphasized a lack of legislative history suggesting a suspension of the suppression remedy. [FN141] The Murdock court disagreed with the Vest court’s analysis of the legislative history, and instead interpreted the legislative statements to read that Section 2515 did nothing to alter the traditional Fourth Amendment analysis that accompanies a search. [FN142] Thus, the court reasoned that like traditional Fourth Amendment procedure that does not require suppression of evidence that police obtain [in good faith / due to luck / etc], the Fourth Amendment and Title III in no way require courts to suppress oral and wire surveillance evidence when the police obtain that evidence merely through a lucky break.[FN143] In support, the court cited the Sixth Circuit case United States v. Underhill [FN144] in demonstrating the principle that evidence suppression under Section 2515 does not occur in all circumstances. [FN145] Nonetheless, the Murdock court held that Section 2515 did not intend to create a loophole through which a defendant could escape liability. [FN146] The Murdock court also considered it vital that a suspension of the suppression remedy in such circumstances would in no way adversely encourage police officers from violating Title III. [FN147] The Murdock court also relied heavily on United States v. Baranek, [FN148]which held that the government could introduce evidence obtained when a defendant failed to properly hang up a phone after a legally wiretapped conversation. [FN149] The court in Baranek explained that the government caught a “lucky break,” and that allowing the introduction of this evidence into court would be consistent with 18 U.S.C. Section 2515. [FN150] The Murdock court came to a similar conclusion, finding the wife’s illegal recording and subsequent disclosure of the telephone conversation to the police analogous to the lucky break in Baranek. [FN151] The court found especially compelling the argument that allowing the evidence into trial “would not create the problem of government agents encouraging violations of Title III.” [FN152] 3. The Present Status of the Clean Hands Exception The Sixth Circuit stands alone in its analysis of the clean hands exception, however, as several other circuits have reasoned that a plain language reading of the statutory exclusionary rule leaves no room for the creation of a clean hands exception. [FN153] These courts hold that the deterrent effect of the exclusionary rule maintains its applicability even when the government has clean hands. These courts emphasize that the Fourth Amendment exclusionary rule, on which the Title III rule is based, is a judicial construct whereas the rule set forth in Title III is a congressionally-created mechanism.[FN154] The fact that the rule has a statutory foundation provides less leeway for the courts in determining when and how to implement the rule. [FN155] In 2009, the Fourth Circuit became the most recent Court of Appeals to hear the matter, and sided with the plurality of federal courts of appeal. [FN156] The court shared much of the reasoning of prior courts, and added that Congress’ silence regarding the ambiguous statute reinforces the plurality’s interpretation, as Congress has had ample time to clarify the statute’s meaning. Nestled within the debate of whether a clean hands exception exists under Title III is whether a plain language reading of the Title III leads one to a natural conclusion that Title III contains a clean hands exception. The Murdock court certainly believed the plain language reading was ambiguous, and looked to legislative intent in deciding the case, declaring “[t]here is nothing in the legislative history which requires that the government be precluded from using evidence that literally falls into its hands.” [FN157] The First Circuit, on the other hand, saw no ambiguity in the statute as written, and refused to extend a “clean hands” exception, explaining “the government’s use of unlawfully intercepted communications where the government was not the procurer would eviscerate the statutory protection of privacy from intrusion by illegal private interception.” [FN158] Congress has declined any opportunity to clarify its meaning, instead leaving the federal courts to battle out the existence and utility of a plain meaning reading of the statute. The clean hands exception functions as the “alter ego” of the good faith exception highlighted by the Court in Leon. [FN159] The Court has applied the good faith exception narrowly, limiting it only to police officers in the field and not applying it to situations in which a Title III exclusionary rule question arises with respect to the third party surveillance. [FN160] In essence, a good faith argument against suppression of evidence may be replaced by one of clean hands in situations of third party monitoring. [FN161] One key distinction, however, is that in many situations of good faith, the officers in question may not be acting illegally, whereas an individual monitoring the communications of another is engaging in a violation of Title III. [FN162] E. The Stored Communications Act The combination of the business record cases and the rapid development of new technologies forced Congress to again address the nexus between Fourth Amendment individual privacy concerns and communications. [FN163]Specifically, due to the business records cases, any info transmitted voluntarily to a third party has no legitimate expectation of privacy, and thus is unprotected by the Fourth Amendment. Since more and more people are using email, which necessarily passes through a third party ISP, this suggests that a key way that people communicate is unprotected by the Fourth Amendment. In 1986, understandably concerned about the privacy of electronic communications, Congress passed the ECPA. [FN164] [FN165]Congress’ purpose behind the ECPA was to extend Fourth Amendment privacy principles to electronic communications and to regulate “the relationship between government investigators and electronic service providers in possession of users’ private information.” [FN166] The ECPA contains three primary sections: The Wiretap Act, the Pen Register Act (“PRA”), and the SCA. [FN167] The SCA alone regulates past and stored information, [FN168] whereas the PRA and the Wiretap Act both govern “communications in transit,” limiting application of these statutes to transmission of information occurring in the moment. [FN169] These statutes can also be distinguished on practical grounds. Whereas telecommunications companies providing services governed by the PRA and the Wiretap Act only have fleeting access to the content of their customers’ communication, ISPs (as well as mobile phone companies storing either voicemail or text messages) maintain access to this information for as long as a customer chooses to leave the information on the server without deleting it. [FN170] A 1985 Congressional study into the privacy implications for technologies to be governed by the ECPA concluded the following with respect to ISP practices:
All electronic mail companies retain a copy of the message both for billing purposes and as a convenience in case the customer loses the message. Based on the reasoning in United States v. Miller, 425 U.S. 435 (1976), where the Court ruled that records of financial transactions, including copies of personal checks, were the property of the bank and that an individual had no legal rights with respect to such records, it is possible that an individual would not have a legal basis from which to challenge an electronic mail company’s disclosure of the contents of messages or records of messages sent. [FN171]Stored communications can include both content and non-content information,[FN172] but the protections enacted in the SCA seek to fortify an individual’s privacy with respect to the content of his electronic communication. [FN173] 1. The Statute’s Protection Against Compulsory Disclosure On its face, the SCA extends a broad range of protection to customers and consumers of electronic communications service providers (“Providers”), such as ISPs. Section 2701 provides both criminal and civil penalties for either accessing without authorization “a facility through which an electronic communication service is provided” or exceeding one’s authorization in accessing such facility. [FN174] However, Section 2701(c) nullifies these punishments in instances in which either an electronic communication service provider or the user of that service authorizes the access. [FN175] Some commentators have pointed out another limitation to the statute. The provision applies only to electronic communications services (“ECS”) [FN176] and, through omission, does not apply to facilities in which a remote computing service (“RCS”) [FN177] is provided. [FN178] This distinction is drawn out in later sections of the SCA, but an understanding of the differences between the two services is necessary to comprehend the SCA. Professor Orin Kerr best explains the distinction between ECS and RCS by breaking down the life of an e-mail into its two core parts: (1) transmission of communication; and (2) storage of that communication in its electronic form.[FN179] When an e-mail is sent to another person through a Provider, the Provider is acting as an ECS with respect to that message—it is providing the user with the ability to transmit the communication, as well as temporary storage. [FN180] However, if that e-mail stays on the Provider’s server beyond a temporary status, statutorily defined as 180 days, [FN181] the very same Provider becomes an RCS in that it is providing computer storage or processing to the public. [FN182] This is true regardless of whether the recipient has read the message. The distinction is further complicated by the fact that most modern ISPs provide both ECS and RCS through their normal procedures. [FN183] In certain circumstances, the SCA requires that a Provider disclose information to the government when the government follows certain specified procedures to request it. Compulsory disclosure under the SCA is governed by Section 2703 and trumps the disclosure limitations set out in Section 2701(c), meaning that neither the government nor the Provider suffers any criminal or civil penalties for disclosure. [FN184] Section 2703 considers three types of electronic communications: (1) those held by an ECS for 180 days or less; (2) those held by an ECS for more than 180 days; and (3) those held by an RCS.[FN185] The 180 day cut-off period becomes extremely important when the government is seeking a compulsory disclosure. Communications in the first group may only be compelled if the government obtains a warrant through normal Fourth Amendment probable cause standards. [FN186] But, communications in either the second or third group allow the police to compel the information by either obtaining a warrant, or obtaining a grand jury or administrative subpoena. [FN187] The government may also obtain the information through a court order provided that the government informs the customer of the subpoena or court order after the fact. [FN188] This tangled compulsory disclosure languages creates a difficult situation for the government seeking evidence in a criminal or national security investigation.[FN189] 2. The Statute’s Allowance of Voluntary Disclosure One pivotal distinction between the SCA and its counterparts enacted under the ECPA is the existence of a voluntary disclosure option. [FN190] While all three parts of the ECPA contain language governing compulsory disclosure by a Provider, the SCA alone contains a provision that allows Providers to independently and voluntarily supply certain information to the government in specific circumstances. [FN191] Sections 2702(b) and 2702(c) govern the voluntary disclosure of customer communicative information by Providers.[FN192] The disclosure of customer non-content, customer records falls under 2702(c), and overrides the limits set forth in Section2702(a). [FN193] Section 2702(b) provides the voluntary disclosure rules pertaining to content information. [FN194] In the case of stored communications, the content information consists of the actual communication within the body of an email.[FN195] The envelope information consists of the sending and receiving email addresses, IP addresses, and email subject lines. [FN196] For the purposes of assessing the connection between the clean hands exception and the SCA, the provisions controlling content information in Section 2702(b) are much important. Section 2702(b) reads as follows:
(b) Exceptions for disclosure of communications. A provider described in subsection (a) may divulge the contents of a communication– (1) to an addressee or intended recipient of such communication or an agent of such addressee or intended recipient; (2) as otherwise authorized in section 2517, 2511(2)(a), or 2703 of this title [18 U.S.C. § 2517, 2511(2)(a), or 2703]; (3) with the lawful consent of the originator or an addressee or intended recipient of such communication, or the subscriber in the case of remote computing service; (4) to a person employed or authorized or whose facilities are used to forward such communication to its destination; (5) as may be necessarily incident to the rendition of the service or to the protection of the rights or property of the provider of that service; (6) to the National Center for Missing and Exploited Children, in connection with a report submitted thereto under section 2258A [18 U.S.C. § 2258A]; (7) to a law enforcement agency–(A) if the contents–(i) were inadvertently obtained by the service provider; and (ii) appear to pertain to the commission of a crime; or (8) to a governmental entity, if the provider, in good faith, believes that an emergency involving danger of death or serious physical injury to any person requires disclosure without delay of communications relating to the emergency.The first seven enumerated circumstances all pertain to either an individual’s right to control his own information, or a particular government purpose. The eighth provision is unlike the previous seven in that it (1) allows for a great deal of discretion, and (2) allows Providers to make the determination regarding both the severity of the emergency and the exigency with which the government will require the information. [FN197] Significantly, Section 2702(b)(8) did not always exist, so Providers were not always allowed to disclose purely because there was an “emergency” situation. [FN198] Prior to its enactment, the SCA allowed for voluntary disclosure only when two stipulations were satisfied: First, the information had to be inadvertently obtained by the service provider. [FN199] Second, the information had to relate to a crime. [FN200] In response to critical national security concerns in the wake of 9/11, and to give law enforcement personnel an enhanced ability to detect and prevent crimes, Congress significantly amended Section 2702(b)(8), otherwise known as the “emergency disclosure provision.” [FN201] The following subpart discusses the evolution of this provision. 3. Significant Amendments to 2702(b)(8) in the Wake of 9/11 Over the course of fourteen months immediately after 9/11, Congress made four critical changes to the voluntary disclosure provisions of Section 2702(b) which greatly increased the scope of provision and ISPs’ discretion. [FN202]Pursuant to Section 212 of the USA PATRIOT Act, on October 26, 2001 the government first expanded the scope of the voluntary disclosure by allowing an ISP to divulge content information to law enforcement if it believed “an emergency involving immediate danger of death or serious physical injury to any person” was imminent. [FN203] Just one year after the PATRIOT Act modifications, in November of 2002, Congress passed the Homeland Security Act which again expanded the scope of voluntary emergency disclosure. [FN204] This modification provided three significant changes to the statute. First, Congress allowed for disclosure in the instance of “serious physical injury,” thereby eliminating the previous “danger of death” requirement. [FN205] Secondly, the Homeland Security Act removed the “reasonable belief” requirement, leaving only a “good faith belief” standard. [FN206] Thirdly, Congress included a requirement that the communication disclosed through Section 2702(b)(8) “relate to the emergency” but also expanded ISPs’ options by allowing them to disclose to any federal, state, or local government entity instead of strictly a law enforcement official. [FN207] Aside from a small alteration in the USA PATRIOT Improvement and Reauthorization Act of 2005, in which Congress clarified that content and noncontent information should be treated identically, Section 2702(b)(8) remains unchanged and, perhaps surprisingly, widely unlitigated. [FN208] The amendments to the voluntary disclosure provisions were immediately controversial. The amendments met faced criticism during Congressional debates. [FN209] The debate featured those who insisted that the amendments were necessary to enable law enforcement and homeland security professionals access to vital information in a timely manner. On the other hand, many privacy advocates argued that the amendments overstepped Fourth Amendment boundaries. Alan Davidson of the Center for Democracy and Technology explained “the emergency disclosure provision of section 102 as drafted currently is overly broad, and we fear would eviscerate some important privacy protections that exist in the law right now…our fear is that these voluntary disclosures are turning into a major loophole in current law, because small providers are not in a position to evaluate these requests when they come, and of course, just turn around and provide this information.”[FN210] Congress also included a check against voluntary disclosure abuses via Section 2702 by requiring the Attorney General to submit an annual report containing the number of voluntary disclosures received by the Department of Justice to the Committee on the Judiciary of the House of Representatives and Committee on the Judiciary of the Senate. [FN211] This report must also contain the basis for disclosure for all instances in which the Department of Justice closed an investigation without filing charges against the ISP user in question. [FN212] It is noteworthy that Congress continues to introduce legislation in efforts to limit the broad scope of the emergency exception. [FN213] In late 2009, Senators Feingold and Leahy, joined by Representatives Conyers and Nadler in the House, proposed legislation to re-amend the language of the emergency disclosure provision. [FN214] The legislation proposed to insert an immediacy requirement for the disclosure. [FN215] This would limit the number of circumstances in which the Providers could disclose information, and provide an added level of privacy protection for customers. [FN216] 4. Remedies Under the SCA The SCA provides for a different set of remedies against a Provider than it does for an action against an individual in violation of the statute. Section 2701(b) provides for both fines and jail time for violations of the SCA by someone other than a Provider, a user with respect to the communication in question, or the government. [FN217] Violations made for the purpose of commercial advantage, malicious destruction or damage, for private commercial gain, or in furtherance of an act against the Constitution may receive a fine and/or jail time up to five years for a first offense and 10 years for any subsequent offenses. [FN218] Violations made in other circumstances may be punished by up to one year imprisonment and a fine. [FN219] The only remedy available against a Provider through the SCA is a civil action.[FN220] The exclusion of evidence is not an available remedy. [FN221]Moreover, Congress set the bar high, requiring the plaintiff to show the Provider acted “with a knowing or intentional state of mind.” [FN222] However, courts have been generous in awarding damages in successful suits, and may not necessarily require the plaintiff to show actual damages. [FN223] 5. SCA Voluntary Disclosure Litigation in the Wake of September 11, 2001 Litigation over Section 2702(b) remains scant. The leading case on this provision is Freedman v. Am. Online, Inc., [FN224] which was decided on Section 2703 grounds after the court explicitly rejected the government’s voluntary disclosure argument under Section 2702(b)(8). [FN225] In Freedman, two police officers in Connecticut faxed an unsigned warrant to America Online (“AOL”), an ISP. Believing the warrant to be effectuated properly, AOL complied with the warrant’s request and disclosed to the police officers the plaintiff’s “name, address, phone numbers, account status, membership information, software information, billing and account information, and his other AOL screen names.” [FN226] The police officers contended that they did not actually require AOL to disclose the information, but rather merely requested it, and that AOL subsequently provided the information in something akin to a voluntary disclosure under Section 2702(b)(8). [FN227] The court rejected the officer’s argument, holding that the officers failed to follow the stipulations set forth in 18 U.S.C. Section 2703(c), and noted that the SCA existed to balance the desire to protect personal privacy with legitimate law enforcement needs. [FN228] The Freedman court explicitly and purposefully distanced its opinion from how it might rule in an emergency circumstance. The court explained that it “decline[d] to speculate whether it would ever be appropriate, under exigent circumstances when it would not be feasible to get a signed warrant or comply with other legal process, for the government to notify the ISP of an emergency and receive subscriber information without conforming with the ECPA.”[FN229] AOL explained that they believed the warrant was issued correctly, and did not intend to voluntarily disclose any information to the police officers.[FN230] The net result is a single instance in which the court refused to find a legitimate voluntary disclosure because there was no evidence of volition by the service provider. However, this holding contains a significant caveat that the court might find otherwise if the circumstances were either (1) more similar to an emergency from the law enforcement’s perspective; or (2) more founded upon a subjective good faith voluntary disclosure by the ISP. Freedman differs from Jayne v. Sprint PCS, [FN231] a 2009 case in which the Court for the Eastern District of California determined that the telecommunication provider acted correctly in providing authorities with an individual’s cell phone records and GPS location. [FN232] Authorities had reason to believe the defendant had kidnapped a child, and contacted the service provider requesting that Sprint voluntarily disclose the information.[FN233] Two key factors distinguish Freedman from Jayne. First, the issue at hand in Jayne was a cell phone and not an email. [FN234] The fact that it was a cell phone and that GPS could be used to locate the defendant increases the likelihood of utility and the urgency. Secondly, the authorities only requested the defendant’s cell phone records, as it would have been impossible to obtain the content of his communications. [FN235] These differences tip in the government’s favor, and the court approved of the disclosure. The court did not add any caveats, and appeared to completely approve of the voluntary disclosure, but the question remains unanswered as to how a similar case would unfold with an electronic communication. [FN236] II. CONNECTING THE CLEAN HANDS DOCTRINE TO THE SCA The modifications made to Section 2702 of the SCA, particularly the emergency exception, have improved the government’s ability to obtain content information from stored communications. [FN237] This enhanced ability assists in the prevention or detection of a crime, and certainly provides the government with another tool in war on terror. [FN238] Instead of engaging in the guesswork oftentimes associated with national security prevention, the government may now rely on Providers such as ISPs to monitor communications traveling through their network and alert the government to any potentially catastrophic events. In 2004, the Department of Justice explained the rationale behind the modifications to Section 2702 that have made this possible: [FN239]
Cooperation of Third Parties The cooperation of third parties in criminal or terrorist investigations is often crucial to a positive outcome. Third parties, such as telecommunications companies, often can assist law enforcement by providing information in emergency situations. Previous federal law, however, did not expressly allow telecommunications companies to disclose customer records or communications in emergencies. Even if a provider believed that it faced an emergency situation in which lives were at risk, if the provider turned over customer information to the government, it risked, in some circumstances, being sued for money damages. Congress remedied this problem in section 212 of the USA PATRIOT Act by allowing electronic communications service providers to disclose records to the government in situations involving an immediate danger of death or serious physical injury to any person. Section 212 has already amply proved its utility.By enacting Section 2702(b)(8), Congress adapted and codified the policy underpinnings of the “clean hands” exception for surveillance by a third party conducted in violation of Title III. In the name of national security, particularly with respect to the asymmetric nature of the war on terror, Congress has created a provision that not only allows, but encourages ISPs to supply the government with a “lucky break.” [FN240] This Part first examines some of the similarities between the clean hands exception and the provisions of Section 2702(b)(8). This subsection also briefly touches upon the “grey zone” complication in which ISPs and other telecommunications companies are not sure if a particular set of facts falls within the compulsory disclosure language of Section 2703 or the voluntary disclosure language of Section 2702(b)(8), and the perverse effects this has on government’s involvement with potentially dangerous situations. This Part then discusses the deterrent factors influencing each regime, and highlights the failure of Congress to include a reasonable check on ISPs and law enforcement in emergency situations. A. Assessing Amendments to the Voluntary Disclosure Provisions as Ratifications of the Clean Hands Doctrine At its core, the clean hands doctrine allows the government to obtain and employ evidence that it either would not be able to obtain on its own, or would not know to obtain on its own. [FN241] This differs from the good faith doctrine, which essentially allows the government to obtain and employ evidence it knew to and attempted to obtain, but committed a procedural error during the course of investigation. [FN242] The clean hands exception comes at a non-trivial price, as the privacy of an individual—admittedly an individual engaging in illegal behavior—is compromised for the sake of furthering an investigation. While one monitoring the communications of another would likely still face Title III consequences, the doctrine implicitly condones the analysis and subsequent dissemination of this information to government officials. The similarities between the clean hands exception, which allows the government access to information obtained in violation of Title III, and the emergency provision codified in Section 2702(b)(8), which allows the government access to information voluntarily disclosed by an ISP independent of government compulsion, are numerous. Section 2702(b)(8), much like the clean hands exception—and its predecessor, the good faith exception—avoid the judicially-sanctioned exclusionary rule. However, there is a key distinction between the two regimes. Those monitoring the activities of others in clean hands cases are still face prosecution for illegally intercepting the electronic communications of another. This provides a deterrent against abuses. This deterrent is not applicable to voluntary disclosures falling under the emergency exception. Voluntary disclosure under the SCA faces three deterrents, though none of them provide enough teeth to satisfactorily deter abuses. First, while there is a civil action remedy available, litigation has been non-existent in cases invoking 2702(b)(8). Secondly, the reporting requirement outlined in Section 2702(d) fails to adequately apply any consequences to abusive monitoring and disclosure. This leaves market forces as the only true impediment to abuses of the voluntary disclosure provisions. Section 2702(b)(8) provides the government with a similar opportunity to collect and employ evidence that it either was not aware to collect, or potentially was unable to collect through other legal means. [FN243] For instance, Section 2703 requires the government to obtain a warrant to compel any electronic communication held within 180 days by an ECS. [FN244] Yet the emergency disclosure provision allows for voluntary disclosure “to a Federal, State, or local governmental entity, if the provider, in good faith, believes that an emergency involving danger of death or serious physical injury to any person requires disclosure without delay of communications relating to the emergency.” [FN245] The government may be suspicious of an individual, or have reason to suspect harm that falls short of probable cause. In such an instance, the government would not be able to obtain the individual’s communications through traditional SCA means. The emergency provision allows the government access to this information completely at the discretion of the Provider. While this may be beneficial in true emergencies, it also opens the door to significant privacy abuses by Providers and the government that are virtually insusceptible to review because of the highly deferential language of the SCA. There are two essential parts to this subsection of the statute, each of which bears comparison with the policy supporting the “clean hands” exception. These are discussed below in turn. 1. The Good Faith Burden and the Exigency of the Situation In 2006 Congress chose to relax the burden of proof on Providers invoking the emergency disclosure exception. [FN246] Congress’ decision to relax the burden of proof on Providers from a good faith belief for disclosure in emergency situations evidences the government’s desire to cast a wide net.[FN247] This change accomplishes two important goals in encourage proactive compliance by Providers. First, the relaxed standard greatly reduces the likelihood of successful litigation against the Provider. [FN248]Theoretically a Provider would not have a difficult time demonstrating a good faith fear in an emergency situation in the aftermath of a publicized disclosure. The inclusion of “good faith” avoids complications arising from the inclusion of an immanency requirement, and defers to the Providers’ discretion regarding the potential for a situation to develop into an emergency. Secondly, by making the standard so attainable, the government makes the Providers virtually immune from legal liability. As a result, telecommunications companies will be more willing to make disclosures proactively, thereby allowing the government access to maximum information. Providers face a winless scenario with regard to voluntary disclosure. If they hold on to information that afterward proves to have been capable of preventing a devastating event, public reaction will be negative. Similarly, if telecommunications companies disclose information less judiciously, and the public determines such dissemination to be a violation of privacy, the reaction will again be negative. Such oversight essentially ensures that telecommunications companies will be controlled by public reaction to current levels of concern regarding terrorism. This encourages a sliding standard of determining imminence with regard to electronic communications. [FN249] This winless scenario is similar to the situation the wife in Murdock faced for a Title III violation. If she held on to the information, or obeyed the law and never obtained the information, then her husband would have continued to break the law with impunity. Similarly, by revealing the evidence, the defendant’s wife opened herself to Title III charges for illegally intercepting private communications. In both cases, the government prefers the interception and divulgence of the information. The executive externalizes the cost of invading individual privacy onto a third party. Under either the clean hands exception or the emergency provision, the government faces less procedural burden by not obtaining a warrant, and does not risk losing the evidence in court over a technicality. If the clean hands exception is applied the technicality of illegally obtained evidence is eliminated per se. Under the emergency exception, the Provider’s only burden is that he subjectively believed that harm would occur. Such a standard is almost impossible to dispel. Furthermore, this does not affect the government’s case: the remedy for a emergency voluntary disclosure is a civil action, and not exclusion of the evidence. This incentive broadens when one considers that Providers, as telecommunications companies, will likely be working in tandem with the government in determining the gravity of an imminent threat, as well as identifying the potential targets. Seth Rosenbloom explains:
Providers are not capable of evaluating the dangerousness of most “emergency” situations without government input. In many cases, the provider’s understanding of the “emergency” will rely entirely on the assertions of the same officials who seek disclosure . . . [n]onetheless, the “good faith” standard and absence of an imminence requirement effectively immunize providers. The combination of a lack of reliable information and poor incentives undermines any possibility that providers will adequately check the government’s access to information.[FN250] Congress’ adoption of the “clean hands” policy in its amendments to the SCA is a qualified adoption: voluntary disclosure may only occur in instances threatening danger of death or serious physical injury. This is a natural restriction, given the impetus for amending the statute. The USA PATRIOT Act aims to “deter and punish terrorist acts in the United States and around the world, to enhance law enforcement investigatory tools, and for other purposes.” [FN251]Congress did not intend to generally broaden the investigative and enforcement powers for less severe circumstances. The effects cited by the Department of Justice have been less terrorist oriented and more akin to “other purposes”. The Department’s 2004 Report from the Field concerning the efficacy of the USA PATRIOT Act details one instance in which the emergency language came into play: [FN252]
Section 212 was used in the investigation of a bomb threat against a school. An anonymous person, claiming to be a student at a high school, posted on the Internet a disturbing death threat singling out a faculty member and several students to die by bomb and gun. The operator of the Internet site initially resisted disclosing to law enforcement any information about the suspect for fear that he could be sued if he volunteered that information. Once a prosecutor explained that the USA PATRIOT Act created a new provision allowing for the voluntary release of information in emergencies, the owner turned over evidence that led to the timely identification of the individual responsible for the bomb threat. Faced with this evidence, the suspect confessed to making the threats. The operator of the Internet site later revealed that he had been worried for the safety of the students and teachers for several days, and expressed his relief that the USA PATRIOT Act permitted him to help.This example demonstrates the wide latitude Providers have in determining the exigency of an emergency. While certainly this situation and others profiled in the report merited police intervention, one may question whether they embody the spirit of the USA PATRIOT Act’s protection of the United States in the “war on terror.” The undermining of personal privacy is a momentous sacrifice, and flies in the face of the fundamental underpinnings of the Fourth Amendment. [FN253] As a society we have chosen privacy over the guaranteed prosecution of every crime, preferring individual liberty instead of a “big brother” totalitarian regime. [FN254] 2. To Whom the ISP May Disclose Information The Murdock court mentioned what it envisions as one effect, or lack thereof, stemming from the admission of a “clean hands” exception: that the government would not feel encouraged to violate privacy protection laws.[FN255] Inherent in this claim is the idea that if the government had played any part in the illegal surveillance and recording—including merely encouraging a third party to engage in the activity on the government’s behalf—the court would invoke the exclusionary doctrine and suppress the evidence. [FN256]However, such a regime may have unexpected consequences: this could result in widespread private citizen monitoring of one another. Professor Orin Kerr acknowledged such outcome might occur if the “clean hands” doctrine permeated more widely than the Sixth Circuit. He explained that “[i]f the suppression remedy applies only to government misconduct, a private party can make an illegal surreptitious interception of another person’s phone call, send it in to the police anonymously, and allow the government to use the evidence against the party whose communication was illegally intercepted.”[FN257] This could even result in police reliance on third party surveillance. If one envisions the scenario above, in which individuals feel at liberty to monitor the behavior of others, law enforcement officials might become dependent upon the individual surveillance mechanisms, especially given the difficulties and complexities of ascertaining a surveillance warrant. [FN258] Police burden for obtaining a warrant is high, rife with procedure, and susceptible to judicial whim. [FN259] As law enforcement become more aware of the clean hands alternative, they may begin to suggest more persuasively that the individuals comply with police insinuations. It is not hard to imagine a scenario in which individuals become conduits for investigations lacking in warrants or probably cause, ultimately eroding the protections of the Fourth Amendment. A similar result is apparent with the modified emergency provision. There is what Professor Orin Kerr calls a “grey zone” in which telecommunications companies will struggle to discern between compelled and voluntary disclosure. In such situations, “government officials have some pre-disclosure contact with providers, but do not ‘require’ disclosure using the procedures set forth in § 2703.” [FN260] This confusion could lead to an abuse by both law enforcement as well as Providers. Freedman v. Am. Online, Inc. evidences the potential for abuse this situation, as the police officers manipulated the ISP to provide information otherwise unattainable. [FN261] B. Limitations of Deterrents Under the Emergency Disclosure Provision of the SCA While the policy underlying the clean hands exception and the emergency disclosure provision of the SCA are very similar in nature, as both allow the government access to information it might otherwise not be aware to investigate or may not be able to investigate, the systemic prevention of abuses in both is very different. Title III still applies to one providing the government information which may eventually escape suppression through the clean hands doctrine. The SCA, however, lacks a substantive and effective means of deterring Providers from overstepping their bounds and interpreting Section 2702(b)(8) broadly. There are three potential factors influencing Providers to exercise discretion in voluntary disclosing personal content information to the government: civil law suits under Section 2707, congressional impugnation after the Department of Justice provides its report pursuant to Section 2702(d), and customer retaliation through market forces. Section 2707 allows for civil suits against Providers when they violate the SCA with a “knowing or intentional mind.” [FN262] When discussing voluntary emergency disclosure, this language must be paired with the language of Section 2702(b)(8), which allows for a “good faith” belief that an emergency “involving danger of death or serious physical injury” may occur. [FN263] This combines to mean that a plaintiff must demonstrate that a Provider (1) knowingly or intentionally reported information (2) without a good faith belief that (3) such an emergency might occur. This is an almost impossible burden for a plaintiff to carry, and “effectively immunize(s) providers.” [FN264] This is likely the reason that there has been no litigation holding a Provider liable under Section 2702(b)(8). [FN265] In other words, practitioners understand that the likelihood of success in litigation is virtually zero. [FN266] The reporting provision of Section 2702(d) has not been an issue of any litigation to date. While the provision appears to be a check on the Executive Branch through congressional oversight, there are notable limitations on this provision. The most significant limitation is that the provision does not provide for incidents in which information has been disclosed to the government but the investigation has not been closed. There are two possible explanations for this omission. First, this allows the Department of Justice and other national security agencies to continue to monitor potential situations. Secondly, and more cynically, this allows the government to protect an ISP who assisted the government by adhering to the broad disclosure regime in an instance in which disclosure was not reasonable. In either case, this provision is susceptible to manipulation, and does not provide Congress with any ability to remedy abuses. Even if Congress found a Provider to have violated the emergency disclosure provision, the only available remedy lies in civil litigation. Congress would need to convince a judge that the Provider did not subjectively believe that the information was necessary to prevent harm. This is an almost impossible standard for Congress, and leaves the Providers completely insulated. This leaves customer outrage and market forces as the sole legitimate deterrent to Provider abuses of the emergency disclosure provision. If customers feel that their Provider is abusing their right to privacy, they always have the right to choose another provider. Providers, such as ISPs, have recognized this potential fallout, and many advisors are recommending that they disengage from assisting the government without a search warrant or subpoena. For instance, the U.S. Internet Service Provider Association recognizes the confusion in emergency provision litigation, and recommends taking a safe approach: [FN267]
Law enforcement agencies sometimes invoke the “emergency” provision in an effort to avoid the necessity of a subpoena or other process. ISPs often must be firm in pointing out that this provision gives the ISP, not law enforcement, authority to decide whether or not to provide information. There is never an “emergency” obligation on an ISP to disclose under 2702(b)(7) . . . . Because of the intense interest of agencies in this exception, it is prudent for an ISP to adopt clear procedures for its use, and to require all government agencies to adhere to the procedures.The threat of public embarrassment may be enough to deter abuse of the voluntary disclosure provision, but the jury is still out on this issue. There is of course the threat that failure to disclose information in a true emergency would lead to an equally vociferous backlash if customers believed that the ISP was the only actor capable of prevention. [FN268] This is potentially the most problematic aspect of the voluntary disclosure deterrence scheme—the reliance on market forces to compel ISP behavior may actually provide excessive deterrence, and marginalize the government’s ability to obtain the information it truly needs when it needs it. The potential for this outcome was the heart of a letter from Verizon to Congress in 2007, as the general counsel for Verizon explained “placing the onus on the provider to determine whether the government is acting within the scope of its authority would inevitably slow lawful efforts to protect the public” and “would delay the government’s receipt of assistance it might need to save lives.” [FN269] III. APPLYING THE SCA AND CLEAN HANDS TO THE HYPOTHETICALS The hypotheticals presented at the beginning of this Comment help elucidate the interplay between the clean hands exception and the voluntary emergency disclosure provision of the SCA. The first situation, in which a man has stored on his computer and with an ISP an email containing information vital to his plan to attack a major U.S. city, presents the quintessential case embracing the ISPs’ freedom from liability under the SCA. The government does not know about this man, and without the assistance of the ISP, he likely would be able to further his plot with impunity. This constitutes the emergency that we all fear, and the ISP’s disclosure of the man’s private communications is certainly justified under Section 2702(b)(8). An individual in possession of such information would, almost assuredly, provide the information to the government notwithstanding the threat of punishment under Title III. In such a situation, the modifications to the emergency disclosure provisions of the SCA play their intended role. The second scenario, in which a man plots an attack on an individual, is more complicated. There is still an emergency, but it is individual in scope and not within the purview of national security. Furthermore, there is reason to question to reasonable likelihood that the attack will actually occur. The wife in possession of the communication would have to weigh the likelihood of an attack against the potential of her being charged with a Title III offense. The ISP in possession of the same message would likely not face the same consequences—even if the man’s plan turned out to be fantasy, it certainly would prevail on the good faith standard. Some might feel that the ISP must or should disclose this information, while others may believe that this does not warrant the invasion of privacy inherent in such disclosure. Such a situation invokes the classic debate over the tradeoff between personal privacy and enhanced police protection—a debate that has consistently fallen on the side of personal privacy before the amendments to the SCA. [FN270] The third scenario demonstrates the gravest threat of the emergency provision amendments. The potential for collusive abuse between law enforcement and a third party in possession of information threatens to undermine the entire foundation of personal privacy in communications. The clean hands exception is distinct from the emergency exception in this instance. If a police officer approached an individual for help obtaining the suspect’s information, it is almost certain that individual would not comply. The stakes are too high, and there is no demonstrated reason to believe the man is engaged in illegal activity. The threat of collusion is not so overbearing so as to jeopardize the utility of the exception. A Provider, however, will be more willing to comply. There is no criminal liability associated with an inappropriate disclosure. Further, the deference given to Providers is so great that there is no true threat of civil liability for inappropriate disclosure. Furthermore, the government does not risk losing access to the evidence. This all adds to a situation in which there is no significant legal deterrent to an abuse of the emergency exception. With the only true threat of recourse stemming from customer outrage, the Provider will be willing to work with the police officer provided it was able to satisfy the low burden of good faith in the aftermath. A likely result of this will be a gradual erosion of privacy in communications. CONCLUSION The voluntary emergency disclosure provisions of the SCA grant a broad degree of discretion to Providers, and allow the government to obtain information it might otherwise be unable to obtain. Like the clean hands exception, this arguably benefits society by allowing law enforcement officials to respond to potential threats in a timely manner. However, the drawbacks of the clean hands exception that similarly exist within the SCA are magnified with the SCA’s voluntary disclosure provisions, as these provisions give Providers virtually no incentive, short of customer outrage, to push back against the government’s potential abuses. It is likely that in the future, the privacy demands of customers will force Providers to demand the government provide a more robust voluntary disclosure regime so that they feel neither overly nor insignificantly threatened by the ramifications of compliance. *** *Brendan Coffman is a student at the George Mason University School of Law, class of 2011, and alumnus of Georgetown University’s Walsh School of Foreign Service. He is an Articles Editor of the George Mason Law Review. [FN1] Jamie S. Gorelick et al., Navigating Communications Regulation in the Wake of 9/11, 57 Fed. Comm. L.J. 351, 353 (2005). [FN2] President George H. Bush, Address to Congress (September 21, 2001). [FN3] Access to information is the government’s foremost necessity with respect to prevention of terrorist attacks. There is an inherent tradeoff of personal liberties when the government augments its need and collection of information. As a result, government involvement with information collection, particularly electronic surveillance, breeds a great deal of resentment, distrust, and skepticism from the public. See, e.g., Wayne McCormack, Understanding the Law of Terrorism 203-212 (2008) (explaining the government’s dilemma with respect to gathering intelligence in hopes of preventing an attack and cultivating distrust among the public); Allison M. Buxton, In re Sealed Case: Security and the Culture of Distrust, 29 Okla. City U. L. Rev. 917, 929-31 (2004) (explaining the American public’s cultural distrust of law enforcement and surveillance activities generally). [FN4] Gorelick, supra note 1, at 353. [FN5] Under the amended language, communications provider who discloses records or other information pursuant to authorization contained in 18 U.S.C. § 2702(c)(4) in emergency circumstances has same protection from lawsuits as provider who discloses records pursuant to court order. See In re Application of U.S. For a Nunc Pro Tunc Order For Disclosure of Telecomms. Records, 352 F. Supp. 2d 45 (D. Mass. 2005). [FN6] 18 U.S.C. §§ 2701-2712 (1986) (last amended 2008). [FN7] Seth Rosenbloom, Crying Wolf in the Digital Age: Voluntary Disclosure Under the Stored Communications Act, 39 Colum. Hum. Rts. L. Rev. 529, 531-32 (2008). [FN8] Id. [FN9] Id. [FN10] 18 U.S.C. § 2702(b)(8) (2006). [FN11] Id.; § 2702(c)(4) (2001). [FN12] See infra Part II.A. [FN13] Shaun T. Olsen, Reading between the Lines: Why a Qualified “Clean Hands” Exception Should Preclude Suppression of Wiretap Evidence under Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 36 Val. U. L. Rev. 719, 745-46 (2002). [FN14] Id. [FN15] The Sixth Circuit stands alone in its application of the clean hands exception to Title III third party surveillance and has been rebuked by several other Circuits. Compare United States v. Murdock, 63 F.3d 1391 (6th Cir. 1995) with United States v. Crabtree, 565 F.3d 887 (4th Cir. 2009). [FN16] See infra Part D.2. [FN17] 18 U.S.C. §§ 2701-2712 (1986). [FN18] See Pew Internet & American Life Project, Daily Internet Activities, 2000-2009, available at http://www.pewinternet.org/Static-Pages/Trend-Data/Daily-Internet-Activities-20002009.aspx (showing that over 50% of American adults use the internet every day, and that almost 50% send or receive email every day). [FN19] United States Census Bureau, Current Population Survey Reports, October 2007, http://www.census.gov/population/www/socdemo/computer.html (last visited April 15, 2010). [FN20] K. G. Coffman & A. M. Odlyzko, Growth of the Internet, AT&T Labs Research, July 6, 2001, available at http://www.dtc.umn.edu/~odlyzko/doc/oft.internet.growth.pdf (last visited April 15, 2010). [FN21] Orin S. Kerr, A User’s Guide to the Stored Communications Act, and a Legislator’s Guide to Amending It, 72 Geo. Wash. L. Rev. 1208, 1209-10 (2004). [FN22] Id. [FN23] See infra Part I.B. [FN24] Alexander Scolnik, Protections for Electronic Communications: The Stored Communications Act and the Fourth Amendment, 78 Fordham L. Rev. 349, 359 (2009) (explaining ISPs’ protocol for storing transactional communication information on their servers). [FN25] Id. [FN26] U.S. Const. amend. IV. [FN27] William B. Cuddihy & B. Carmon Hardy, A Man’s House Was Not His Castle: Origins of the Fourth Amendment to the United States Constitution, 37 Wm. & Mary Q. 372, 400 (1980). Cuddihy and Hardy argue that the Fourth Amendment “represented an American extension of the English tradition that a man’ house was his castle…[t]he requirement that all search warrants be specific, the heart of the Fourth Amendment, accordingly enlarged the tradition’s scope, for it controlled searches by the government to a degree never previously attempted.” Id. [FN28] Marjorie G. Fribourg, The Bill of Rights: Its Impact on the American People 10 (1967) (explaining that the protection of personal rights is the most fundamental distinguishing factor in America’s Constitution). [FN29] William C. Banks & M.E. Bowman, Executive Authority for National Security Surveillance, 50 Am. U. L. Rev. 1, 2-4 (2001). [FN30] Daniel J. Solove, Digital Dossiers and the Dissipation of Fourth Amendment Privacy, 75 S. Cal. L. Rev. 1083, 1126 (2002) (explaining James Madison’s belief that the structure of the Constitution and the insertion of the judicial branch in the middle of the executive branch’s investigative process would lead to the best solution). [FN31] Banks & Bowman, supra note 29, at 3-4; David Hardin, The Fuss over Two Small Words: The Unconstitutionality of the USA PATRIOT Act Amendments to FISA Under the Fourth Amendment, 71 Geo. Wash. L. Rev. 291, 295-97(2003) (explaining that finding space for electronic surveillance in the Fourth Amendment doctrine has been difficult); James X. Dempsey;Communications Privacy in the Digital Age: Revitalizing the Federal Wiretap Laws to Enhance Privacy, 8 Alb. L.J. Sci. & Tech. 65, 69-71 (1997) (explaining that the indiscriminate nature of electronic surveillance has posed greater threats to privacy than physical search and seizure). [FN32] Rosenbloom, supra note 7, at 537. [FN33] Black’s Law Dictionary 1464 (8th ed. 2004). Many commentators debate the merits of the exclusionary rule, arguing that it creates an unfair position for the government in having to both combat crime and uphold civil liberties. For a discussion focusing on the dilemmas in applying the exclusionary rule. See, Randy E. Barnett, Resolving the Dilemma of the Exclusionary Rule: An Application of Restitutive Principles of Justice, 32 Emory L.J. 937 (1983). [FN34] See, e.g., Wong Sun v. United States, 371 U.S. 471 (1973). [FN35] Weeks v. United States, 232 U.S. 383 (1914). Weeks remains the landmark case in the creation of the exclusionary rule in federal courts, whereas Mapp v. Ohio extended the rule to state courts. 367 U.S. 643 (1961). [FN36] See, e.g., Mapp, 367 U.S. at 648; Lawrence Crocker, Can the Exclusionary Rule Be Saved?, 84 J. Crim. L. & Criminology 310, 310-14 (1993). Many substitutions for the exclusionary rule have been suggested, most notably a solution in which violating police officers are liable in damages to individuals whom they arrest with the aid of illegally obtained information. See Pierre Schlag, Assaults on the Exclusionary Rule: Good Faith Limitations and Damage Remedies, 73 J. Crim. L. & Criminology 875 (1982). [FN37] United States v. Leon, 468 U.S. 897 (1984). [FN38] Id. at 918. [FN39] Id. [FN40] Id. [FN41] Id. at 908-913. [FN42] Id. at 922-23 (citing Franks v. Delaware, 438 U.S. 154 (1978)). [FN43] Id. at 23 (citing Lo-Ji Sales, Inc. v. New York, 442 U.S. 319 (1979) (warrant at issue “left it entirely to discretion of officials conducting search to decide items which were likely obscene and to accomplish seizure”). [FN44] Leon, 468 U.S. at 922 (quoting Brown v. Illinois, 422 U.S. 590 (1975)(Powell, J., concurring)). [FN45] Id.; 1 Wayne R. LaFave, Search and Seizure: A Treatise on the Fourth Amendment § 1.3 (4th ed. 2004). [FN46] See, e.g., Donald Dripps, The Case for the Contingent Exclusionary Rule, 38 Am. Crim. L. Rev. 1, 2 (2001) (arguing that the Supreme Court has appeared to “have adopted both positions” in the debate over the exclusionary rule). [FN47] David Hardin, The Fuss over Two Small Words: The Unconstitutionality of the USA PATRIOT Act Amendments to FISA Under the Fourth Amendment, 71 Geo. Wash. L. Rev. 291, 296-97 (2003). [FN48] Banks & Bowman, supra note 29, at 3-4. Banks and Bowman explain “Moreover, the Fourth Amendment was designed to protect against overreaching in investigations of criminal enterprises. Investigations of politically motivated threats to our national security, such as terrorism or espionage, were simply not contemplated.” Id. Prior to the enactment of the 14th Amendment, the Supreme Court suggested that warrants issued pursuant to federal civil litigation may not be protected by the Fourth Amendment. See Murray’s Lessee v. Hoboken Land & Improvement Co., 59 U.S. 272, 285 (1855). However, after the enactment of the 14th Amendment, the Supreme Court clarified its previous holding and narrowed its decision strictly to due process. See Walker v. Sauvinet, 92 U.S. 90, 92-93 (1875); Pac. Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 30-32 (1991) (explaining the interplay between Murray’s Lessee and Walker). [FN49] Olmstead v. United States, 277 U.S. 438 (1928). [FN50] Id. at 455-57. [FN51] Id. at 457. [FN52] Id. at 466. Justice Brandeis’ dissent foreshadowed the short lifespan of the Olmstead decision. Brandeis proclaimed “[The Founders] conferred, as against the Government, the right to be left alone – the most comprehensive of rights and the right most valued by civilized men. To protect, that right, every unjustifiable intrusion by the Government upon the privacy of the individual, whatever the means employed, must be deemed a violation of the Fourth Amendment.” Id. at 478. [FN53] Several Supreme Court cases advanced the scope of the Fourth Amendment’s privacy protections. The Court’s first recognition of a Constitutional right to privacy concerned the freedom to associate. See NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 466 (1958) (holding that a private association could not be forced to disclose the names of its members). The Court also found constitutionally protected right to political privacy in Watkins v. United States, 354 U.S. 178 (1957) and Sweezy v. New Hampshire,354 U.S. 234 (1957). The most important case to advance the privacy rights of individuals during this time period was Griswold v. Connecticut, 381 U.S. 479 (1965) (holding that a Connecticut law criminalizing the use of contraceptives violated a constitutional right to marital privacy and was therefore unconstitutional). This summary was adapted from Banks & Bowman, supranote 29, at 44-47. [FN54] 388 U.S. 41. [FN55] Id. at 63-64. The Berger court was extremely divided and contained three vociferous dissents from Justice Black, Justice Harlan, and Justice White.Id. at 70, 89, 107. Justice White appeared most dissatisfied with the ruling, particularly because he felt that the New York legislature jumped through the requisite hoops to enact the statute. Id. at 109-111. Justice White’s wrath is most directly aimed at Congress for failing to clarify wiretapping and surveillance rules despite substantial indication that it was going to be a matter of great concern between the executive and the judiciary. Id. at 112-19. [FN56] Id. at 55-56. [FN57] Id. at 119. [FN58] Id. [FN59] Berger v. New York, 388 U.S. at 128. [FN60] Id. at 129. [FN61] 389 U.S. 347. [FN62] Id. at 348-49. [FN63] Id. [FN64] Id. at 348. [FN65] Id. at 359. [FN66] Katz v. United States, 389 U.S. at 360-61 (Harlan, J., concurring); Terry v. Ohio, 392 U.S. 1, 9 (1968) (adopting Justice Harlan’s concurring analysis). [FN67] Banks & Bowman, supra note 29, at 47 (2001). See also Christopher Woo & Miranda So, The Case for Magic Lantern: September 11 Highlights the Need for Increased Surveillance, 15 Harv. J. L. & Tech. 521, 523 (2002) (explaining that Justice Harlan’s concurring opinion has become the “the governing standard for defining when a Fourth Amendment search occurs and has been used by courts to determine whether a new technology comes within the scope of the Fourth Amendment”). [FN68] See Berger, 388 U.S. at 129 (noting that the holding does not pertain to national security concerns). [FN69] See Katz, 389 U.S. 347 (1967). [FN70] Id. at 358 n.23 (1967) (explaining “[w]hether safeguards other than prior authorization by a magistrate would satisfy the Fourth Amendment in a situation involving the national security is a question not presented by this case”). [FN71] Id. at 363-64 (1967) (White, J. concurring). [FN72] Id. at 363. [FN73] Omnibus Crime Control and Safe Streets Act of 1968, Pub. L. No. 90-351, 82 Stat. 197, 211-25 (codified as amended at 18 U.S.C. 2510-2522 (2000)). [FN74] Ric Simmons, From Katz To Kyllo: A Blueprint for Adapting the Fourth Amendment to Twenty-first Century Technologies, 53 Hastings L.J. 1303, 1339 (2002). [FN75] 18 U.S.C. § 2510(2) (1994); Orin S. Kerr, Are We Overprotecting Code? Thoughts on First-Generation Internet Law, 57 Wash & Lee L. Rev. 1287, 1299 (2000). Professor Kerr notes that that the protection of wire communications “did not include the requirement that the communications support a reasonable expectation of privacy” because in 1968 all wire communications were between two humans, and such a requirement would have seemed “superfluous.” [FN76] 18 U.S.C. § 2510(1) (1994). [FN77] 18 U.S.C. § 2518 (1968). [FN78] Id.; Paul M. Schwartz, Reviving Telecommunications Surveillance Law, 75 U. Chi. L. Rev. 287, 290 (2008). [FN79] 18 U.S.C. § 2518(3) (2000). [FN80] 18 U.S.C. § 2518(3)(c) (2000). [FN81] 18 U.S.C. § 2518(5) (2000). [FN82] Nathan C. Henderson, The Patriot Act’s Impact on the Government’s Ability to Conduct Electronic Surveillance of Ongoing Domestic Communications, 52 Duke L. J. 179, 183 (2002). [FN83] 18 U.S.C. § 2515 [FN84] Id. at 182-83. [FN85] Kerr, surpa note 75, at 1299; Simmons, supra note 74, at 1339-41. [FN86] Simmons, supra note 74, at 1340 (explaining § 2510 of Title III and connecting it to Justice Harlan’s concurring opinion in Katz). [FN87] Patricia L. Bellia, Surveillance Law through Cyberlaw’s Lens, 72 Geo. Wash. L. Rev. 1375, 1396 (2004). [FN88] U.S. v. Miller, 425 U.S. 435 (1976). [FN89] Smith v. Maryland, 442 U.S. 735 (1979). [FN90] Marc J. Zwillinger & Christian S. Genetski, Criminal Discovery of Internet Communications Under the Stored Communications Act: It’s Not a Level Playing Field, 97 J. Crim. L. & Criminology 569, 574 (2007). [FN91] Id. [FN92] Orin S. Kerr, A User’s Guide to the Stored Communications Act, and a Legislator’s Guide to Amending It, supra note 21, at 1209-10. [FN93] Miller, 425 U.S. at 437. [FN94] Id. at 438-39. [FN95] 116 U.S. 616 (1886). [FN96] Miller, 425 U.S. at 439. [FN97] Id. at 440. [FN98] U. S. v. Miller, 425 U.S. 435, 443 (1976). [FN99] Smith, 442 U.S. at 735. [FN100] At the time of the case, a pen register was understood to mean “a device that records the numbers dialed on a telephone by monitoring electrical impulses caused when the dial is released.” Bellia, supra note 87, at 1427-28. [FN101] Smith, 442 U.S. at 737. [FN102] Id. at 742. [FN103] Id. at 743. [FN104] Id. at 744. [FN105] See infra Part I.C. [FN106] Francis M. Hamilton, III, Should “Clean Hands” Protect the Government Against § 2515 Suppression Under Title III of the Omnibus Crime Control and Safe Streets Act of 1968?, 53 Wash & Lee L. Rev. 1473, 1480 (1996). [FN107] Olsen, supra note 13, at 749. [FN108] 63 F.3d 1391 (6th Cir. 1995). [FN109] Id. [FN110] Id. at 1392-93. [FN111] Id. [FN112] Id. [FN113] Id. [FN114] Id. [FN115] Id. at 1393-94. The “business extension exemption” is a limit on the applicability of Title III, and exempts the monitoring of communications carried out in the normal course of business. The court of appeals determined that despite the fact that the family’s business had a phone line in the house, the nature of the monitoring was not consistent with normal business practices. For more information regarding the business extension exemption, see Thomas R. Greenberg, E-mail and Voice Mail: Employee Privacy And The Federal Wiretap Statute, 44 Am. U. L. Rev. 219, 239 (1994). [FN116] Murdock, 63 F.3d at 1393. [FN117] 18 U.S.C. § 2515 (1968). [FN118] Murdock, 63 F.3d at 1393. [FN119] Id. (citing Williams v. Poulos, 11 F.3d 271, 279 (1st Cir.1993)). [FN120] Id. [FN121] Id. [FN122] Id. at 1404. [FN123] Id. at 1402-04. The applicable law in the matter was 18 U.S.C. § 2515. [FN124] Murdock, 63 F.3d at 1402-04. The applicable law in the matter was 18 U.S.C. § 2515. [FN125] Id. at 1403. [FN126] United States v. Vest, 813 F.2d 477 (1st Cir. 1987). [FN127] Id. [FN128] Id. at 481. [FN129] Id. at 479. [FN130] Id. [FN131] Id. [FN132] Id. at 481. [FN133] 408 U.S. 41 (1972). [FN134] Vest, 813 F.2d at 481 (internal quotations omitted) (citing Gelbard v. United States, 408 U.S. 41, 47-52 (1972)). [FN135] S. Rep. No. 1097, 90th Cong., 2d Sess., 66 (1968) (quoted in Gelbard v. United States, 408 U.S. 41, 47-52 (1972)). [FN136] Vest, 813 F.2d at 481. [FN137] 18 U.S.C. 2516(1)(b) (1986). [FN138] Id. [FN139] In re Grand Jury, 111 F.3d 1066, 1068 (3rd Cir. 1997). [FN140] Id. at 1077. [FN141] Id. [FN142] Murdock, 63 F.3d at 1402-03. [FN143] Id. at 1403. [FN144] 813 F.2d 105 (6th Cir. 1987). [FN145] Murdock, 63 F.3d at 1402 (citing United States v. Underhill, 813 F.2d 105, 111-112 (6th Cir. 1987)). [FN146] Id. at 1403. [FN147] Id. at 1402. [FN148] 903 F.2d 1068 (6th Cir. 1990). [FN149] Id. [FN150] Id. at 1072. [FN151] Murdock, 63 F.3d at 1402-03. [FN152] Id. at 1402. [FN153] See United States v. Crabtree, 565 F.3d 887, 889 (4th Cir. 2009); Chandler v. U.S. Army, 125 F.3d 1296, 1302 (9th Cir. 1997); In re Grand Jury,111 F.3d 1066, 1079 (3d Cir. 1997); United States v. Vest, 813 F.2d 477, 481 (1st Cir. 1987) (all holding that a plain reading of § 2515 does not allow for a clean hands exception to be granted to the government in an illegal surveillance case). [FN154] See, e.g., United States v. Vest, 813 F.2d 477, 481 (1st Cir. 1987). [FN155] Matthew A. Josephson, To Exclude Or Not To Exclude: The Future of the Exclusionary Rule After Herring v. United States, 43 Creighton L. Rev. 175, 180 (2009). [FN156] Crabtree, 565 F.3d at 890. [FN157] Murdock, 63 F.3d at 1403. [FN158] Vest, 813 F.2d at 481 (internal quotations omitted). For an article discussing the accuracy of the First Circuit’s logic, see Hamilton, supra note 106, at 1506. [FN158] See Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 814-15 (1945) (holding that “clean hands” is essentially a vehicle for the implementation of the “good faith” doctrine); see also Castle v. Cohen, 840 F.2d 173, 178 (3d Cir. 1988) (holding that “clean hands” is simply another expression of “good faith”); Olsen, supra note 13, at 722. [FN160] Olsen, supra note 13, at 722. [FN161] Id. [FN162] 18 U.S.C. § 2511(1)(a). The court has noted some exceptions, most notably the business extension exemption. See supra note 94. [FN163] Bellia, supra note 87, at 1396; Michael S. Leib, E-Mail and the Wiretap Laws: Why Congress Should Add Electronic Communication to Title III’s Statutory Exclusionary Rule and Expressly Reject a “Good Faith” Exception, 34 Harv. J. on Legis. 393, 396 (1997). [FN164] Pub. L. No. 99-508, § 101(c), 100 Stat. 1848, 1851-52 (1986) (changes various portions of Title III, 18 U.S.C.). [FN165] Leib, supra note 163, at 402-04. [FN166] Kerr, supra note 21, at 1212. [FN167] Rosenbloom, supra note 7, at 538 n.151. [FN168] 18 U.S.C. §§ 2701-2712 (1986). [FN169] 18 U.S.C. §§ 2511-2522 (1986). [FN170] Federal Government Office of Technology Assessment: Electronic Surveillance and Civil Liberties 45 (1985); See also, Leib, supra note 163, at 404-05 (explaining ISPs practice of retaining copies of customers’ emails for administrative purposes). [FN171] Federal Government Office of Technology Assessment: Electronic Surveillance and Civil Liberties 45 (1985). [FN172] The content/non-content distinction is often referred to as the “Content/Envelope Distinction.” The analogy is clear: there is a difference between the actual content and information transmitted between two parties, and the information required to direct a third party transmitter (such as a telephone company or ISP) to the correct recipient. For more information regarding the distinction, see, Achal Oza, Amend the ECPA: Fourth Amendment Protection Erodes as E-mails Get Dusty, 88 B.U. L. Rev. 1043, 1049 (2008). [FN173] While not completely resolved, court and commentators largely agree that non-content information is not protected by the Fourth Amendment. See, e.g., Warshak v. United States, 532 F.3d 521, 525-27 (6th Cir. 2008) (holding that an individual has a reasonable expectation of privacy to the content of his email, but not to the transactional information). See also United States v. Forrester, 512 F.3d 500, 510 (9th Cir. 2007) (holding that ISP transactional information was “constitutionally indistinguishable from the use of a pen register that the Court approved in Smith”). Congress eventually recognized that transactional envelop information pertaining to e-mail revealed considerably more about a person than the numbers he dials on a telephone. As a result Congress stopped allowing law enforcement to obtain this information through subpoena in 2000 through the Communications Assistance for Law Enforcement Act (CALEA), and instead limited access to such information to a court order. Communications Assistance for Law Enforcement Act, Pub. L. No. 103-414, 108 Stat. 4279 (1994). For more information about CALEA, see Henderson, supra note 82, at 183. [FN174] 18 U.S.C. § 2701 (a)-(b) (1986). [FN175] 18 U.S.C. § 2701 (c) (1986). [FN176] The statute defines electronic communications services as “any service which provides to users thereof the ability to send or receive wire or electronic communications.” 18 U.S.C. § 2510 (15) (1986). [FN177] The statute defines remote computing service as “the provision to the public of computer storage or processing services by means of an electronic communications system.” 18 U.S.C. § 2711(2) (1986). [FN178] Bellia, supra note 87, at 1415. [FN179] Kerr, A User’s Guide to the Stored Communications Act, supra note 21, at 1216-18. [FN180] Id. at 1215-16. [FN181] The 180 day threshold is provided by the compelled disclosure provision of the SCA, found at 18 U.S.C. 2703 (1986). See infra Part 2. [FN182] Kerr, A User’s Guide to the Stored Communications Act, supra note 21, at 1215-16. [FN183] LaFave, Criminal Procedure, supra note 45, at § 4.8(d); U.S. Internet Service Provider Association, Electronic Evidence Compliance–A Guide for Internet Service Providers, 18 Berkeley Tech. L.J. 945, 949 (2003). [FN184] Bellia, supra note 87, at 1416. [FN185] 18 U.S.C. § 2703 (1986). [FN186] 18 U.S.C. § 2703(a) (1986). [FN187] Id. [FN188] 18 U.S.C. § 2703(b)-(c) (1986). [FN189] The Department of Justice Computer Crimes and Intellectual Property Section officially interprets Section 2703(d) to mean that the government can access, through subpoena, any copies of electronic communication at any time after the recipient of the communication has accessed it. For more information, see, Office of Legal Education, Searching and Seizing Computers and Obtaining Electronic Evidence in Criminal Investigations (Richard Downing et al. eds., 3rd ed. 2009), available athttp://www.cybercrime.gov/ssmanual/ (last visited April 19, 2010). [FN190] Rosenbloom, supra note 7, at 538-39. [FN191] Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56, 115 Stat. 272, 284-85; Rosenbloom, supra note 7, at 538. [FN192] 18 U.S.C. §§ 2702(b)-(c) (1986). [FN193] 18 U.S.C. § 2702(a) (1986). [FN194] 18 U.S.C. §§ 2702(b)-(c) (1986). [FN195] Rosenbloom, supra note 7, at 543-44. [FN196] Id. [FN197] Gorelick, supra note 1, at 361 n.53. [FN198] 18 U.S.C. § 2702(b)(6)(A) (2000). [FN199] Id. [FN200] 18 U.S.C. § 2702(b)(6)(A) (2000). [FN201] Rosenbloom, supra note 7, at 559-60. [FN202] Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56, 115 Stat. 272, 284-85; Id. at 559-60. [FN203] Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56, 115 Stat. 272, 284-85. [FN204] Homeland Security Act of 2002, Pub. L. 107-296, 116 Stat. 2135, 2157. [FN205] Rosenbloom, supra note 7, at 559-60. [FN206] Id. [FN207] Id. [FN208] Rosenbloom also notes a fourth change in the 2006 USA PATRIOT Act Improvement and Reauthorization Act in which Congress officially removed any barriers separating the rules for content disclosure and noncontent disclosure by inserting the broadly defined phrase “communications relating to the emergency”. Id.; USA PATRIOT Improvement and Reauthorization Act of 2005, Pub. L. 109-177, 120 Stat. 192, 202-03 (2006). [FN209] See, e.g., Cyber Security Enhancement Act of 2001 Hearing Before the H. Subcomm. on Crime, 107th Cong. 58 (2005), available at http://commdocs.house.gov/committees/judiciary/hju77697.000/hju77697_0f.htm (last visited April 19, 2010). [FN210] Id. [FN211] 18 U.S.C. 2702(d) (2006). [FN212] Id. [FN213] S. 1686, 111th Cong. § 105 (1st Sess. 2009); H.R. 1800, §7. S. 1686, §105 (1st Sess. 2009). [FN214] Id. [FN215] Id. [FN216] Charles Doyle, Congressional Research Service, National Security Letters: Proposed Amendments in the 111th Congress, at 20, (Oct. 2009),available at http://www.fas.org/sgp/crs/intel/R40887.pdf. [FN217] 18 U.S.C. 2701(b) (1986). [FN218] Id. [FN219] Id. [FN220] 18 U.S.C. 2707 (1986). [FN221] United States v. Mercado-Nava, 486 F. Supp. 2d 1271, 1279 (D. Kan. 2007) (explaining that “exclusion of the evidence is not an available remedy for a Title II violation of the ECPA, see 18 U.S.C. §§ 2515, 2708. The remedy for such a violation, set forth in 18 U.S.C. § 2707, lies in a civil action against the person or entity who violated the statute”). [FN222] 18 U.S.C. 2707 (1986). [FN223] See, e.g., Konop v. Hawaiian Airlines, Inc. (In re Hawaiian Airlines, Inc.), 355 B.R. 225, 230 (D. Haw. 2006). [FN224] 303 F. Supp. 2d 121 (D. Conn. 2004). [FN225] Id. at 124. [FN226] Id. at 123. [FN227] Id. at 126-27. [FN228] Id. at 127. [FN229] Id. at 128. [FN230] AOL successfully dismissed all claims against it relating to this matter on a forum selection clause in the contract, and therefore did not have to litigate the matter. Freedman, 303 F. Supp. 2d at 123. [FN231] 2009 WL 426117 (E.D. Cal. Feb. 20, 2009). [FN232] Id. at *2. [FN233] Id. [FN234] Id. at *2 [FN235] Id. [FN236] Id. at *7. [FN237] See, Wayne McCormack, Understanding The Law of Terrorism 135 (2007). [FN238] Id. [FN239] U.S. Dep’t of Justice, Report from the Field: The USA PATRIOT Act at Work 26 (2004), available at http://www.justice.gov/olp/pdf/patriot_report_from_the_field0704.pdf. [FN240] See, Jim Garamone, Rumsfeld Says Country Faces Two Options in War on Terror, American Forces Press Service, August 25, 2003, available at http://www.globalsecurity.org/military/library/news/2003/08/mil-030825-afps02.htm (last visited Jan. 17, 2010). [FN241] Olsen, supra note 13, at 755. [FN242] See Part I, supra note xx [FN243] Rosenbloom, supra note 7, at 562-63. [FN244] 18 U.S.C. 2703(a) (2006). [FN245] 18 U.S.C.S. § 2702(b)(8) (2006). [FN246] Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56, 115 Stat. 272, 284-85. [FN247] Homeland Security Act of 2002, Pub. L. 107-296, 116 Stat. 2135, 2157. [FN248] Rosenbloom, supra note 7, at 564-65. [FN249] Id. at 566. [FN250] Rosenbloom, supra note 7, at 565. [FN251] Preamble to the USA PATRIOT Act, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001) (codified as amended in scattered sections of 18 U.S.C. and 50 U.S.C. (2000 & Supp. 2003)). [FN252] U.S. Dep’t of Justice, Report from the Field: The USA PATRIOT Act at Work 26 (2004), available at http://www.justice.gov/olp/pdf/patriot_report_from_the_field0704.pdf. The report contains a total of five instances in which Section 212 of the USA PATRIOT Act, amending Sections 2702 and 2703 of the SCA, have led law enforcement officials to successful prevention of serious injury. Only the example given could reasonably be categorized as a national security concern. [FN253] See Solove, supra note 30, at 1117-28. [FN254] Id. at 1101. [FN255] Murdock, 63 F.3d at 1402. [FN256] See, e.g., Olsen supra note 13, at 756-59. [FN257] Orin Kerr, Lifting the “Fog” of Internet Surveillance: How a Suppression Remedy Would Change Computer Crime Law, 54 Hastings L.J. 805, 837 n. 154 (2003). [FN258] See Solove, supra note 30, at 1119. [FN259] Id. at 175-76. [FN260] Rosenbloom, supra note 7, at 565. [FN261] Freedman, 303 F. Supp. 2d at 128. [FN262] 18 U.S.C. § 2707(a) (1986). [FN263] 18 U.S.C. § 2702(b)(8) (2006). [FN264] Rosenbloom, supra note 7, at 565. [FN265] Kerr, The Future of Internet Surveillance Law, supra note 21, at 1209-10. [FN266] Id. [FN267] U.S. Internet Service Provider Association, supra note 183, at 962. [FN268] Rosenbloom, supra note 7, at 564-65. [FN269] Letter from Randal S. Milch, Senior Vice President, Legal & External Affairs & General Counsel, Verizon Business. to John D. Dingell, Chairman, U.S. H.R. Comm. on Energy & Commerce, to Edward J. Markey, Chairman, U.S. H.R. Subcomm. on Telecomm. & Internet, and to Bart Stupak, Chairman, U.S. H.R. Subcomm. on Oversight & Investigations 3-4 (Oct. 12, 2007), available at http://markey.house.gov/docs/telecomm/Verizon_wiretaping_response_101207.pdf (last visited April 19, 2010). [FN270] Solove, supra note 30, at 1117-28.
Software Developers, On Guard!: Offering Software for Sale Can Trigger a Bar to Patentability Even If the Software Is Untested and Incomplete
By Paul A. Ragusa and Jack Chen* A pdf version of this article may be downloaded here. In Pfaff v. Wells Elecs., Inc., [FN1] the Supreme Court formulated the now well known test for determining when an invention cannot be patented due to a sale or offer for sale more than one year prior to the filing of a patent application. Specifically, the Court held that an invention need not be “reduced to practice” at the time of the sale or offer to create a statutory bar against patent protection. [FN2] Instead, a sale or offer of an invention “ready for patenting,” is sufficient to raise a statutory bar. [FN3] The purpose of the on-sale bar is to encourage early disclosure of inventions to the public as well as to prevent a de facto patent term extension by those who would commercially exploit an invention for an extended period of time prior to filing a patent. During the past twelve years, the courts have applied the Pfaff test to various technologies, some with more clarity than others. One thorny area involves the application of the Pfaff test in the context of software related inventions. Although the Pfaff Court rejected precedent that an invention needed to be “substantially complete” to provide a statutory bar, [FN4] it did not address how a software related invention can be ready for patenting where the code is incomplete, and untested. As a practical matter, how is a court to determine whether an unfinished software-related invention is ready for patenting and therefore can operate to trigger an on-sale bar? A recent district court decision addresses this issue head-on and is discussed below. I. Background An applicant may be barred from patenting a software method after offering it for sale even if the computer code implementing the method is incomplete at the time of the offer. The patent statute states, “[a] person shall be entitled to a patent unless…the invention was…on sale in this country, more than one year prior to the date of the application for patent in the United States.” [FN5] The purpose of the on-sale bar is to encourage early disclosure and to prevent inventors from removing existing knowledge from public use. [FN6] The on-sale bar applies when two conditions are met: (i) the invention is the subject of a commercial offer for sale and (ii) the invention is ready for patenting prior to the statutory one-year period. [FN7] An invention is “ready for patenting” where either (i) the invention has been reduced to practice or (ii) the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention. [FN8] II. Robotic Vision Systems The Court of Appeals for the Federal Circuit addressed the Pfaff test in the context of an invention involving software or computer programming in Robotic Vision Sys., Inc. v. View Eng’g, Inc. [FN9] There, the court addressed a software method for scanning leads on integrated circuit devices. The application for Robotic’s patent was filed on June 24, 1992, establishing a one-year date of June 24, 1991. [FN10] In March of 1991, Robotic sold one of its scanning devices to Intel Corporation and agreed to deliver the patented device to Intel by June 3, 1991, thereby establishing a commercial offer for sale in March 1991, prior to the critical date of June 24, 1991. [FN11] The Federal Circuit determined whether the claimed invention was ready for patenting prior to the critical date. Some time between March and April of 1991, a co-inventor of the patented scanning method, William Yonescu, disclosed the claimed method to Daniel Briceno of Robotic and asked him to write the software to implement the method. [FN12] It was undisputed that Briceno ultimately completed the software program according to Yonescu’s description in March-April 1991, thereby establishing that Yonescu’s description was sufficiently specific to allow Briceno to practice the invention and that the claimed invention was ready for patenting prior to the critical date of June 24, 1991. [FN13] According to the court, the second Pfaff requirement may be satisfied even though there is no “actual completion of such software…, provided that there is a disclosure that is sufficiently specific to enable a person skilled in the art to write the necessary source code to implement the claimed method.” [FN14]Under the Pfaff test, Robotic’s invention was therefore invalid due to an on-sale bar. [FN15] III. Netscape Commc’ns Corp. Netscape Commc’ns Corp. v. ValueClick, Inc. [FN16] involved the cookies feature of the popular Netscape browser in which a piece of data, called a “cookie” and stored on the user’s local computer, could be sent to the remote web server to enable the remote server to remember previous interactions with the user. For example, a remote server could identify a particular user by his or her cookie and present the user with his or her stored shopping cart of merchandise. ValueClick argued that the cookie feature was the subject of an offer for sale as early as July or August of 1994, more than one year prior to the filing of the corresponding patent application on October 6, 1995. [FN17] Netscape countered that no software product could have included the cookie feature prior to the one-year date (October 6, 1994) because the public release of the Netscape browser did not occur until after that date (October 13, 1994). Thus, Netscape argued that the cookie feature was not reduced to practice prior to the on-sale bar date. [FN18] According to the District Court, “this statement misunderstands the law governing the ‘ready for patenting’ Pfaff prong because it assumes that an invention is only reduced to practice, and thus the on-sale bar can only be applied, after the source code has been perfected.” [FN19] Testimony by Netscape’s expert revealed that a draft version of source code pertaining to the cookie feature was entered into Netscape’s software repository on October 4, 1994. [FN20] Netscape also testified that part of the method was completed by October 6, 1994, and that an early version of the code was entered into the software repository on October 3, 1994. [FN21] Thus, the District Court concluded that the existence of the draft source code prior to October 6, 1994, although perhaps incomplete, demonstrated that the method was ready for patenting prior to the critical date. The court went further. “Moreover, with respect to inventions involving computer code, Pfaff simply requires complete conception of the invention, not the source code’s actual completion, provided that there is an enabling disclosure that would allow one skilled in the art to complete the invention.”[FN22] In a declaration to the Patent and Trademark Office, Netscape’s Chief Technology Officer, John Giannandrea, stated that Netscape’s software developer, Lou Montulli, disclosed the cookie invention, which corresponded to claim 1 of the patent-in-suit, during design review meetings in July and August of 1994. [FN23] According to Giannandrea, the meetings involved Giannandrea and Montulli drawing the software architecture for the cookie invention on a white board. [FN24] The District Court found that Giannandrea, a software developer with more years of experience than Montulli, was a person of ordinary skill in the art for purposes of the Robotic test. [FN25] The July/August disclosure to Giannandrea and Montulli’s completion of the source code in October of 1994, coupled with Giannandrea’s years of software programming experience, constituted an enabling disclosure that would have enabled Giannandrea to write the source code. Accordingly, the District Court held that the evidence showed that the cookies invention was “ready for patenting” under the second prong of the Pfaff test. IV. Conclusion The Netscape case highlights the risk of offering for sale software products that are under development. A simple investigation concerning whether software code was complete is insufficient to establish the critical date for the purposes of § 102(b). Instead, an investigation should determine when the invention was disclosed in sufficient detail to enable one of ordinary skill in the art to write software, regardless of the state of software development. *** *Paul A. Ragusa is a partner and Jack Chen an associate in the New York office of Baker Botts LLP, where they practice intellectual property law with an emphasis on patent litigation, patent portfolio management, counseling, and licensing. [FN1] 525 U.S. 55 (1998). [FN2] Id. at 67. [FN3] Id. at 68. [FN4] Id. at 66. [FN5] 35 U.S.C. § 102(b). [FN6] Pfaff, 525 U.S. at 64. [FN7] Id. at 67-68. [FN8] Id. at 68. [FN9] 249 F.3d 1307, 1312 n.2 (Fed. Cir. 2001). [FN10] Id. at 1309. [FN11] Id. at 1311. [FN12] Id. [FN13] Id. at 1311-12. [FN14] Id. at 1312 n.2. [FN15] Id. at 1312-13. [FN16] No. 1:09cv225, 2010 U.S. Dist. Lexis 8733 (E.D. Va 2010). [FN17] Id. at 8779-80. [FN18] Id. at 8779. [FN19] Id. at 8780. [FN20] Id. at 8779. [FN21] Id. [FN22] Id. at 8780 (citing Robotic Vision Sys., 249 F.3d at 1311-13). [FN23] Id. at 8745-8746 n.8, 8782-83. [FN24] Id. at 8782-83. [FN25] Id. at 8782.
Foreign Formats – Licensing Optional?: Why ABC’s “Bombshell” Memo regarding Foreign Formats Isn’t Scandalous at All
by Alexandra Schwartz* A pdf version of this article may be downloaded here. I. Introduction On June 24, 2008, ABC Executive Vice President Howard Davine wrote a memo to ABC’s executive producers and show-runners which raised eyebrows in the industry when it was leaked. The memo suggested that there may be no need to license a foreign television show (“foreign format”) when all that is being taken from the show is the “underlying premise.” [FN1] He strenuously urged the executive producers and show-runners to first go to ABC’s Creative Affairs group when they had seen or were about to see a show that they were potentially interested in licensing so that ABC could decide, both creatively and legally, whether licensing was truly necessary. Mr. Davine made four main points regarding business reasons that licensing these formats are to the disadvantage of ABC and should be avoided. First, he noted that the foreign format copyright holders will want recognition and seek Executive Producer credit as well as a degree of creative control, typically to be rendered from a foreign location — adding an “unnecessary layer” to the creative process. [FN2] Second, he argued against licensing because there would likely be a decrease in profits from format rights fees and Executive Producer fees as well as the reality that a large portion of the backend [FN3]would have to be shared with the format’s right holder. [FN4] Third, the studio may be limited in its ability to exploit derivative works from the show depending on the stature of the rights holder. Fourth, if a show is licensed, the deal may be dependent upon the studio’s ability to sell the U.S. series internationally without restriction and the interest of the foreign rights holder to sell episodes of their underlying series in the U.S. market — motivations that are often not compatible or economically equivalent. [FN5] The entertainment community’s reaction to this memo has been quite mixed, with some saying that Mr. Davine was merely protecting ABC and doing his job, and others viewing the memo as an example of the studios cheating writers. [FN6] Of course, foreign producers have been particularly critical of the memo since their shows are at the heart of the matter and are perhaps less likely to be licensed after this memo. [FN7] Also, certain intellectual property watchdog organizations have raised alarm about the potential implications of the memo. [FN8] This paper addresses what appears to be a contentious and unsettled issue — at what point does copyright law force studios to compensate foreign format producers for the adoption of their shows, if ever? The paper concludes that, in fact, there is no difference in the decision between whether a U.S. company needs to license a U.S. format versus whether it needs to license a foreign format. While Mr. Davine’s memo may be provocative, it nonetheless reaches a sensible legal solution. Simply put, show-runners and executive producers need not contract and pay for every concept they produce as a result of seeing or hearing about a foreign TV show, movie, or book. II. Copyright Law U.S. law protects works copyrighted in foreign jurisdictions from infringement within the United States. [FN9] [FN10] Under U.S. law, to state a claim for copyright infringement, a plaintiff must prove “(1) ownership of a valid copyright and (2) copying [by the defendant] of constituent elements of the [copyrighted] work that are original.” [FN11] A. Ownership of Valid Copyright To determine ownership of a valid copyright, a plaintiff must prove that (1) he owns the copyright, and (2) the copyright is valid. [FN12] 1. Determining Ownership of a Copyright. In determining who owns a copyright issued in a foreign country — as is likely the case with foreign formats — U.S. courts will look to either international treaties or the jurisdiction in which the work was copyrighted. The Berne Convention, to which the United States is a party, applies to all parties to it and expressly provides that “[o]wnership of copyright in a cinematographic work shall be a matter for legislation in the country where protection is claimed.”[FN13] Thus, if the creators of a show reside in Brazil, and the show is initially broadcast there, Brazilian law will determine who is entitled to copyright ownership. [FN14] Regarding protection of that copyright, according to the “national treatment” principle of the Berne Convention and the Universal Copyright Convention (“U.C.C.”), to which the United States is also a party, “an author who is a national of one of the member states of either Berne or the U.C.C., or one who first publishes his work in any such member state, is entitled to the same copyright protection in each other member state as such other state accords to its own nationals.” [FN15] If the law of the country of infringement, here it would be the U.S., applies to the scope of substantive copyright protection, the court will apply that law uniformly to foreign and domestic authors. [FN16] Thus, while the law of the country of origin will determine initial ownership, once it has been assigned, the owners may sue in U.S. courts under domestic law for infringement and compensation. [FN17] However, it is worth noting that if the plaintiff is capable of bringing suit in his home country against a defendant who also has operations there (in addition to the United States), he may lose the ability to bring suit in the United States under forum non conveniens.[FN18] B. Valid Copyright Under U.S. Law As the Davine memo does not discuss a specific instance of a foreign format television show being used — and thus does not have a reference country for the law of ownership — this paper uses U.S. law as a baseline for discussing what constitutes a valid copyright. Normally, however, the law of the country in which the copyright originated would govern. In order to be within the subject matter of copyright law, a work must be an (1) original work of authorship and (2) fixed in a tangible medium of expression.[FN19] An original work of authorship is one that possesses an “independent origin and a minimal amount of creativity.” [FN20] Thus, if a show is the result of a creator’s individual thoughts, experiences, or creative urges and is not merely identical to something that he has previously seen, it meets the standard for an original work of authorship. Secondly, a work is considered “fixed” in a tangible medium of expression when “it is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.” [FN21] In order to be fixed in a tangible form, a work only need be recorded in some manner “capable of identification and having a more or less permanent endurance.” [FN22] Thus, a show that has already been recorded, or even the expression of ideas in treatment, index cards, tapes or the like embody a stable enough form to be considered fixed in a tangible medium. Under these criteria, it appears that virtually any idea for a show that came to an executive as a result of viewing, reading, or listening to a foreign television program would likely fall within the subject matter of copyright law. C. Copyright Infringement Once a plaintiff has shown that he is the owner of a valid copyright, he must next show that the defendant undertook “copying of constituent elements of the [copyrighted] work that are original.” [FN23] This copying must have amounted to “an improper or unlawful appropriation.” [FN24] An unlawful appropriation is established by showing that the work at issue bears a “substantial similarity” to the original copyrighted expression of the earlier work. [FN25] Where a plaintiff cannot show a reasonable opportunity for the defendant to have accessed the work, proof that the protected and accused works are “strikingly similar” suffices to give rise to an inference of copying. [FN26] To show a “striking similarity” between works, a plaintiff must produce evidence that the accused work could not have been the result of independent creation.[FN27] i. Originality In order to establish a claim for copyright infringement, the owner of a valid copyright must prove not only copying and substantial similarity, but also ”copying of constituent elements of the [copyrighted] work that are original.”[FN28] Thus, a plaintiff cannot make out a claim of infringement if the allegedly infringing work copied a non-original part of the copyrighted work. “The sine qua non of copyright is originality…[which] means only that the work was independently created by the author…and that it possesses at least some minimal degree of creativity.” [FN29] “[T]he requisite level of creativity [needed to establish originality] is extremely low,” and “[t]he vast majority of works make the grade quite easily, as they possess some creative spark, no matter how crude, humble or obvious it might be.” [FN30] However, where the “quantum of originality is slight and the resulting copyright is ‘thin,’ infringement will be established only by very close copying because the majority of the work is unprotectable.” [FN31] Thus, the degree of originality and the closeness of copying form a matrix that, depending on the balance from each side, determine whether a copyright has in fact been infringed. ii. Substantial Similarity To prove a claim for copyright infringement, a plaintiff must first prove access and substantial similarity between the two works. [FN32] The specific test used in order to evaluate substantial similarities varies by court. The Second Circuit has held that a court may ask if the copying is qualitatively and quantitatively sufficient to be considered “substantially similar.” [FN33] If one of these two factors is particularly strong, it can help to balance out the relative weakness of the other – “even if a copied portion be relatively small in proportion to the entire work, if qualitatively important, the finder of fact may properly find substantial similarity.” [FN34] In contrast, the Ninth Circuit has employed the “Ordinary Observer” test, which asks whether an ordinary observer who has read, seen, or heard both the plaintiff’s and the defendant’s work would be able to recognize that defendant’s work was based on or used plaintiff’s work. [FN35] [FN36] More recently, the Ninth Circuit appears to be employing a modified version of the Ordinary Observer test, requiring a plaintiff pass both an extrinsic and intrinsic test. The extrinsic test evaluates whether there are objective similarities of ideas and expression between the two works and, where the works are literary in nature, focuses on similarities between the plot, sequence of events, theme, characters, dialogue, mood, setting, and pace of each work.[FN37] The Ninth Circuit requires a court that is applying the extrinsic test to distinguish between the expressive elements of the two works that are protectable versus not protectable. [FN38] [FN39] Under the extrinsic component, a court should engage in “analytic dissection” and compare “the individual features of the works to find specific similarities between the plot, theme, dialogue, mood, setting, pace, characters, and sequence of events.”[FN40] The intrinsic test looks at “expression subjectively.” [FN41] iii. Expression The Copyright Act does not protect ideas, systems or discoveries; rather, it protects an author’s particular expression of an idea. [FN42] Unprotectable elements of a work include general plot ideas and “scenes a faire,” which are scenes that flow naturally from unprotectable basic plot premises and “remain forever the common property of artistic mankind.” [FN43] Nor does copyright protection extend to “‘stock’ themes commonly linked to a particular genre.”[FN44] Such customary themes, or “scenes a faire,” are not copyrightable as a matter of law. [FN45] [FN46] Expressions that are protectable, in comparison, include the specific details of an author’s rendering of ideas, or “the actual concrete elements that make up the total sequence of events and the relationships between the major characters.” [FN47] The primary objective of copyright is to promote the progress of science and art and to this end, “copyright assures authors the right to their original expression, but encourages others to build freely upon the ideas and information conveyed in the work.” [FN48] However, deciding when something is just an idea versus a protected expression is not always a straightforward endeavor, and requires a stringent analysis of what a work presents. [FN49] iv. Originality Threshold As discussed supra, to be copyrightable, a work must have a modicum of original expression. Moreover, the contribution of the second author must be made to the specific portion of the work that was copied, as merely adding wholly dissimilar scenes and not sufficiently modifying those copied is not sufficient to escape a charge of copyright infringement. [FN50] This means that, in theory, works which are derivative from other works may have a more difficult time establishing originality. However, to be considered original every feature of a work must not be new— if that were the case then it would be hard to obtain a copyright for any artistic work since plots, materials, ideas and circumstances are constantly repeated but in a different form or combination.[FN51] *** The case law suggests that copyright holders face significant hurdles in successfully pursuing a claim: not only must they first prove that they own a valid copyright, but they also must prove access and substantial similarity in order to prove copying (or if the former is lacking, then striking similarity), that what was copied was a protectable element of the work, and then finally contend with the fact that they still might not be able to recover if the purportedly infringing author has made some “non-trivial” contribution to what he copied. III. Case Examples The question of whether a work (or portion of it that is original) has been copied improperly is one of fact to be determined by the court. [FN52] While Mr. Davine’s memo did not refer to any specific examples, previous examples in the case law are instructive to whether his memo set forth proper legal advice concerning copying foreign formats. A. Domestic Television Shows i. Infringement Proven In Minniear v. Tors, the Court upheld a jury’s award of damages and found that copyright infringement had occurred when the defendant’s producer attended a showing of a pilot film for a series entitled “Sea Divers” and later produced the “Sea Hunt” series. The “Sea Divers” film was made and shown to prospective purchasers, sponsors, and TV stations for the purposes of developing the first underwater series on television. [FN53] Both of the series featured ex-Navy Frogmen doing deep-sea dives and featured stories about recovering jet pilots. [FN54] The Court decided there were enough similarities in the basic plot ideas, themes, sequences, and dramatic hooks to demonstrate that plaintiff’s ideas and precise format were the inspiration for the defendant’s series. In Universal Pictures Co. v. Harold Lloyd Corp., the Court found that substantial similarity existed between two films because fifty-seven consecutive scenes were “lifted almost bodily from [the original production]” and it was “not just the reproduction of an isolated single incident or event.”[FN55] In the plaintiff’s work, “Movie Crazy,” the star of the film attends a dinner dance and mistakenly dons the coat of a magician. He then proceeds to dance with the hostess during which time various comedic incidents occur, and persist even after he changes partners. These incidents include doves fluttering, white mice crawling, and eggs rolling down the sleeves. During the resulting uproar, the magician enters and reproaches the star for stealing the coat and the star is discovered to be present without credentials and is literally thrown out. In “So’s Your Uncle,” the main character goes to a night club and while there, through the aid of a waiter in the club seeks a change of clothing in order to appear to be both himself and his uncle. The waiter gives him a magician’s coat unknowingly. He then dances with one of his companions, and the comedy incidents occur, almost exactly as they do in “Movie Crazy” with practically the same results. The star leaves with his dancing partner and the waiter is blamed by the magician for the loss of his coat. [FN56] Due to the striking similarity displayed between the two films in these scenes, the Court found infringement – “the whole picture need not be copied to constitute infringement; the mere copying of a major sequence is sufficient.” [FN57] ii. Infringement Not Proven In Olson v. National Broadcasting Co., Inc., the Court employed the two-part extrinsic and intrinsic test and held the defendant’s television series “A-Team” did not infringe on plaintiff’s “Cargo” because the shows were not substantially similar even though some of the characters were similarly depicted and they were both shows about Vietnam veterans shown in a positive light. The Court found that while some episodes of “The A-Team” may have included some of the plot incidents presented in “Cargo,” such similarities were “insufficient to constitute the type of congruence of plot relevant to the substantial similarity inquiry” and more was needed. [FN58] Ultimately, the plots — the “Cargo” crew was coerced into breaking up a drug-smuggling ring while the A-Team was hired to find a reporter missing somewhere in Mexico — were simply too divergent to be considered substantially similar. [FN59] In Hendried v. Four Star Television, the Court held that copyright infringement had not occurred when both plaintiff’s proposed television series and defendant’s produced series featured heroes that traveled in chauffeur-driven Rolls-Royces because the shows were otherwise not substantially similar. The hero in one show was a millionaire playboy detective while the heroes in the other were a father and son duo of international troubleshooters. [FN60] As the Court noted, a “resemblance based solely on the use of a well publicized, even bromidic, symbol for wealth and luxury seems grossly inadequate to sustain a claim of substantial or material similarity.” [FN61] B. Foreign Format Television Shows Like claims based on copyright infringement of domestic television shows, those based on foreign shows are also determined based on the facts — meaning an evaluation of the substantial similarity and/or additional original expression of the two shows’ plots, characters, sequence of events, and other relevant components. i. Recent Foreign Format Infringement Suits In RDF Media Ltd. v. Fox Broadcasting Co., plaintiffs, the creators of “Wife Swap UK,” a British reality show about switching spouses from disparate families and watching the ensuing interactions, sued the creators of ‘Trading Spouses,” a U.S.-based reality show of the same concept for copyright infringement. [FN62] The defendants tried to get the copyright infringement claims thrown out based on procedural grounds, but the Court would not dismiss them. [FN63] The failure of the defendants to make a motion to dismiss based on the merits of the case (i.e. that “Trading Spouses” did not infringe upon the format of “Wife Swap”) as well as settlement outside of court [FN64]suggests that the plaintiffs would likely have prevailed in their copyright infringement claims or at least had a strong case. Similarly, in Tokyo Broadcasting System, Inc. v. American Broadcasting Companies, Inc., the Court rejected the defendant’s motions to dismiss on grounds other than copyright infringement were rejected by the Court. [FN65]Tokyo Broadcasting Systems (“TBS”), a Tokyo-based company, brought suit under the allegations that several of its shows formats had been copied by the American show Wipeout. TBS specifically argued that Wipeout “incorporates not only the total concept and feel of the Shows but also the most significant, original and expressive elements of the Shows including the use of silly but difficult physical challenges on huge obstacle courses, the comical portrayal of contestants’ failed attempts, the methods of highlighting such failed attempts, the use of two commentators who make humorous comments, similar camera angles, instant replay and slow-motion devices, and the use of the same challenges and obstacle courses.” [FN66] ABC attempted to get the case throw out, but did not refute the copyright infringement charges. Once again, the lack of challenge on the merits of the copyright infringement claim suggests that the defendants, here notably ABC, the company that Mr. Davine represents, is tacitly admitting culpability for copying. IV. Conclusion Copyright infringement is not an automatic result when a television producer or show-runner creates a show based on what he has seen or read. It is not the inspiring idea itself, but rather its specific original expression that cannot be copied without modification. As the cases discussed above illustrate, whether a show infringes a validly held copyright on a different show requires a close analysis of the facts — exactly how similar were the plots, characters, and scenes? A studio may wish to protect itself against potential litigation by licensing foreign works when it would like to create a production that adheres very closely to that work. This is because if it is found to have infringed it may end up losing far more in damages or in settlement (not to mention legal fees) than it would have cost to pay for an initial license. However, acting as though a license is always needed without thorough scrutiny of the existing and proposed productions is just bad business. Mr. Davine’s proposal was a sensible one: defer to the experts in determining whether a contract is needed in order to avoid potentially unnecessary costs and production hurdles that come along with any licensing arrangement — domestic or foreign. This is likely an unwelcome conclusion for some creators of original content and it may indeed seem unfair. However, as Justice Brennan correctly observed it is not “some unforeseen byproduct of a statutory scheme.” [FN67]Strong policy reasons exist to allow for this apparent “looseness” in copyright law. Some protection is indeed essential – content creators need to be able to protect and profit from their work – lest they lose the motivation and ability to make a livelihood from this creation. However, there needs to be flexibility within the system to allow for the continuation of thought in order “[t]o promote the Progress of Science and useful Arts.” [FN68] If the outrage sparked by Mr. Davine’s memo is indicative of a strong underlying feeling that the balance is off, those individuals should not shoot the messenger, but rather speak to their lawmakers. *** * B.A. 2005, Cornell University; J.D. 2010, NYU School of Law. [FN1] Howard Davine, Davine Memo, June 24, 2008, http://www.deadline.com/hollywood/bombshell-abc-studios-memo-a-blueprint-to-rip-off-foreign-tv-series. [FN2] Id. [FN3] Meaning royalties or payments that are made after a television show is aired. [FN4] Id. [FN5] Id. [FN6] See Nikki Finke, Bombshell ABC Studios Memo Is Blatant Blueprint to Rip Off Foreign TV Series, July 10, 2008, http://www.deadline.com/hollywood/bombshell-abc-studios-memo-a-blueprint-to-rip-off-foreign-tv-series (anonymous comments on Ms. Finke’s blog range from “Would someone please tell me what’s so exceptional about this? doesn’t it simply explain the legal need to differentiate between an inspirational source and a direct influence?” to “This leaves the company wide open to possibly gazillions in litigation from any foreign network with a show that even remotely resembles an ABC production. All they have to do is wave around this memo because it’s practically a confession. And no doubt anyone with an unsold pilot with a passing resemblance to running ABC shows can probably also jump on the litigation bandwagon. This behaviour is not only unethical, but writing it down as a memo passed all over town is damn stupid”). [FN7] See Leigh Holmwood, TV Execs Slam ABC Man’s Memo About Foreign Formats, The Guardian, Aug. 11, 2008. [FN8] See FRAPA Response to ABC Leaked Memo, The Format Recognition and Protection Association, Aug. 12, 2008, http://www.frapa.org/press/press-releases/28-frapa-response-to-leaked-abc-memo-.html (“Mr. Davine’s skillfully written memo does not use words like steal, theft or rip-off, but it certainly could be seen as encouraging his Producers and Show-runners not to license formats honestly…If ABC and Disney refuse to repudiate the content of the Davine memo, then Producers in the US and around the world might note their silence and help themselves to the ‘underlying premise’ of Miley Cyrus and Hannah Montana…Producers might even be persuaded by Mr. Davine’s memo to be inspired by the ‘general underlying premise’ of a well known Disney cartoon character. In the spirit of the memo, the rip-off rodent might be called Tricky Mouse”). [FN9] See generally Itar-Tass Russian News Agency v. Russian Kurier, Inc., 153 F.3d 82 (2d Cir. 1998). [FN10] When a work is not copyrighted in the United States but rather in a foreign country, as is likely the case with many foreign format shows that are the issue of this paper, there is an additional jurisdictional hurdle and choice of law question. “If the issue is the relatively straightforward one of which of two contending parties owns a copyright, the issue is unquestionably an ownership issue, and the law of the country with the closest relationship to the work will apply to settle the ownership dispute. But in some cases…the issue is not simply who owns the copyright but also what is the nature of the ownership interest. Yet as a court considers the nature of an ownership interest, there is some risk that it will too readily shift the inquiry over to the issue of whether an alleged copy has infringed the asserted copyright. Whether a copy infringes depends in part on the scope of the interest of the copyright owner. Nevertheless, though the issues are related, the nature of a copyright interest is an issue distinct from the issue of whether the copyright has been infringed.” Itar-Tass Russian News Agency, 153 F.3d at 91. [FN11] Feist Pubs. Inc. v. Rural Tel. Serv. Co., Inc., 499 U.S. 340, 361 (1991). [FN12] Id. [FN13] Berne Convention, Art. 14 bis (2)(a); see also Restatement (Second) of Conflict of Laws, § 222, The General Principle (2009) (the interests of the parties in property are determined by the law of the state with “the most significant relationship” to the property and the parties). [FN14] There is, however, one procedural qualification. Under United States law, an owner (including one determined according to foreign law) may sue for infringement in a United States court only if it meets the standing test of 17 U.S.C. § 501(b), which accords standing only to the legal or beneficial owner of an “exclusive right.” Id. [FN15] Id. at 89 (citing Nimmer on Copyright § 17.05 (1998)); see also S.M. Stewart, International Copyright and Neighboring Rights § 3.17 (2d ed. 1989) (“Both the question of whether the right exists and the question of the scope of the right are to be answered in accordance with the law of the country where the protection is claimed”). [FN16] Id. [FN17] It is important to note that a foreign plaintiff cannot recover statutory damages under § 441(c) of the Copyright Act for “(1) any infringement of copyright in an unpublished work commenced before the effective date of its registration; or (2) any infringement of copyright commenced after first publication of the work and before the effective date of its registration, unless such registration is made within three months after the first publication of the work.” The Football Ass’n Premier League Ltd. v. YouTube, Inc., 633 F.Supp.2d 159, 162 (S.D.N.Y. 2009). This means that while “actual damages” are allowed, statutory damages will be prohibited unless the foreign format was registered in the U.S. within the above prescriptions. See also Itar-Tass Russian News Agency, 153 F.3d at 88. Although plaintiffs have argued this is in contravention to the Berne Convention, courts have insisted that “Section 412 [of the Copyright Act] has no exception excusing foreign works from its mandate it requires registration to obtain statutory damages for both domestic and foreign works.” The Football Ass’n Premier League Ltd., 633 F.Supp.2d at 162 (citations omitted). However, an exception exists for live broadcasts, such as of “sporting events, concerts, theatrical presentations and news and public affairs programs.” Id. at 165 (citing Works Consisting of Sounds, Images, or Both, 46 Fed.Reg. 28,846, at 28,849 (May 29, 1981)). [FN18] See Murray v. British Broadcasting Corp., 81 F.3d 287 (2d. Cir. 1996). [FN19] Uranita Foundation v. Maaherra, 114 F.3d 955, 958 (9th Cir. 1997); Melville B. Nimmer & David Nimmer, Nimmer on Copyright, § 2.02 2-18 (1999). [FN20] Baltimore Orioles v. Major League Baseball Palyers, 805 F.2d 663, 675 (7th Cir. 1986). [FN21] 17 U.S.C. § 101. [FN22] Nimmer § 1.08[C] 1-66.30. [FN23] Feist, 499 U.S. at 361. [FN24] Castle Rock Entertainment, Inc. v. Carol Pubs. Group, Inc., 150 F.3d 132, 137 (2d Cir. 1998). [FN25] Id. [FN26] Baxter v. MCA, Inc., 812 F.2d 421, 423 (9th Cir. 1987); Arnstein v. Porter, 154 F.2d 464 (2d Cir.1946), cert. denied, 330 U.S. 851 (1947). [FN27] See Walker v. Univ. Books, Inc., 602 F.2d 859, 864 (9th Cir. 1979). [FN28] Feist, 499 U.S. at 345. [FN29] Id. [FN30] Id. [FN31] Beaudin v. Ben and Jerry’s Homemade, Inc., 95 F.3d 1, 2 (2d Cir. 1996); see also I William F. Patry, Copyright Law and Practice 607, n. 639 (1994). [FN32] Palmer v. Braun, 287 F.3d 1325, 1330 (11th Cir. 2002); see alsoWarner Bros. Inc. v. American Broadcasting Cos., 654 F.2d 204, 207 (2d Cir. 1981) (“It is well settled that copying may be inferred where a plaintiff establishes that the defendant had access to the copyrighted work and that the two works are substantially similar”). [FN33] Castle Rock Entertainment, Inc., 150 F.3d at 138. [FN34] Baxter v. MCA Inc., 812 F.2d 421, 425 (9th Cir. 1987). [FN35] Harold Llyod Corp. v. Witwer, 65 F.2d 1 (9th Cir. 1933); Kustoff v. Chaplin, 120 F.2d 551 (9th Cir. 1941); Twentieth Century-Fox Film Corp. v. Stonesifer, 140 F.2d 579 (9th Cir. 1944) (holding that the test of infringement is the observations and impressions of “the average reasonable reader and spectator”). [FN36] This standard has endured some criticism. The court in Golding v. RKO Radio Pictures, 193 P.2d 153 (Cal. Ap. 1948) said the test of the reaction of the ordinary person is “deceptive and unrealistic,” as it is obvious that the ordinary observer cannot differentiate between original and unoriginal material and could not say whether a substantial similarity between two works was with respect to original material or to matters in the public domain. In defense of the test, however, it can be said that if it takes an expert to find similarities or infringement in a particular case, the infringement, if any, may be too trivial or too doubtful to be actionable. [FN37] Metcalf v. Bocho, 294 F.3d 1069, 1073 (9th Cir. 2002). [FN38] Meaning, original versus non-original. [FN39] Apple Computer, Inc. v. Microsoft Corp., 35 F.3d 1435, 1446 (9th Cir. 1994). [FN40] Narell v. Freedman, 872 F.2d 907, 912 (9th Cir. 1989). [FN41] Apple Computer, 35 F.3d at 1442. [FN42] See Feist, 499 U.S. at 355 (“In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery”) (citations omitted); see also Metcalf, 294 F.3d at 1074 (compilation of unprotectable facts may gain protection through selection and arrangement). [FN43] Id. [FN44] Walker v. Time Life Films, Inc., 784 F.2d 44, 50 (2d. Cir.), cert. denied, 476 U.S. 1159 (1986). [FN45] Hoehling v. Universal City Studios, Inc., 618 F.2d 972, 979 (2d Cir.),cert. denied, 449 U.S. 841 (1980). [FN46] Examples of scenes a faire include disgruntled police officers, superheros lifting cars to show strength and the setting of a POW camp in Hitler’s Germany. Walker, 784 F.2d at 50 (urban police milieu); Warner Bros. Inc. v. ABC, Inc., 654 F.2d 204, 210 (superheros and cars); Bevan v. CBS, Inc., 329 F.Supp. 601, 606 (S.D.N.Y.1971) (German POW camp). [FN47] Feist, 499 U.S. at 362. [FN48] Id. at 349-50. [FN49] See Nichols v. Universal Pictures Corp., 45 F.2d 119, 121 (2d Cir. 1930) (“[T]he line between mere ‘ideas’ and protected ‘expression’ is famously difficult to fix precisely”). [FN50] Malkin v. Dubinsky, 146 F. Supp. 111 (S.D.N.Y 1956). [FN51] Stanley v. Columbia Broadcasting System, 192 P.2d 495, 504 (Cal. App. 1948); Alfred Bell & Co. v. Catalda Fine Arts, Inc., 90 U.S. Pat. Q. 153 (N.Y. 1951) (“All that is needed to satisfy both the constitution and the statute is that the ‘author’ contributed something more than a ‘merely trivial’ variation, something recognizably ‘his own.’ Originality in this context ‘means little more than the prohibition of actually copying.’ No matter how poor artistically the author’s addition, it is enough to be his own.”); Ecclesiastes 1:9 (“[T]here is nothing new under the sun”). [FN52] Dezendorf v. Twentieth Century-Fox Film Corp., 99 F.2d 850 (CA2d 1938); Stanley v. Columbia Broadcasting System, 221 P.2d 73 (Cal. 1950); Yadkoe v. Fields, 151 P.2d 906 (Cal. 1944). [FN53] Minniear v. Tors, 266 Cal. App. 2d 495, 497 (2d Dist. 1968). [FN54] Id. at 504. [FN55] Universal Pictures Co. v. Harold Lloyd Corp., 162 F.2d 354, 361 (9th Cir. 1947). [FN56] Id. at 358. [FN57] Id. at 361. [FN58] Olson v. National Broadcasting Co., Inc., 855 F. 2d 1446, 1450 (9th Cir. 1988). [FN59] Id. at 1450-51. [FN60] Hendried v. Four Star Television, 266 Cal. App. 2d 435, 436-37 (2d. Dist. 1968). [FN61] Id. at 437. [FN62] See generally RDF Media Ltd. v. Fox Broadcasting Co., 372 F.Supp.2d 556 (C.D. Cal. 2005). [FN63] The court found the issue of copyright registration for the purposes of statutory recovery moot since, by the time it reviewed the dismissal motion, all of the episodes had been properly registered. Id. at 562. [FN64] Mindy Farabee, Can Reality Be Copyrighted?, June 24, 2009, http://www.linerlaw.com/data/1250106471.pdf. [FN65] See generally Tokyo Broadcasting System, Inc. v. American Broadcasting Companies, Inc., CV08-06550 SJO (C.D. Cal. 2008). [FN66] Id. [FN67] Feist, 499 U.S. at 349-50. [FN68] Id. (citing Art. I, § 8, cl. 8. Accord; Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156, 95 S.Ct. 2040, 2044, 45 L.Ed.2d 84 (1975)).
by Brian Pearl* A pdf version of this article may be downloaded here. I. INTRODUCTION Girl Talk is the self-imposed moniker of Pittsburgh, Pennsylvania-based artist Gregg Gillis. Since his first album, “Secret Diary,” [FN1] Gillis’s work has evolved from glitch-heavy electronic music interspersed with pre-existing samples to a collage of the most recognizable (and dance-able) moments from hit songs spanning decades as well as musical genres. [FN2] “Night Ripper,” the third Girl Talk album, pushed Girl Talk out of the underground and onto the pages of magazines including Rolling Stone, Blender, and SPIN. [FN3]Influential taste-maker Pitchfork Media fawned over “Night Ripper,” calling the album a “voracious music fan’s dream: a hulking hyper-mix designed to make you dance.” [FN4] “Night Ripper” also enabled Gillis to accomplish every musician’s goal – quitting his day job. [FN5] Gillis spent much of 2007 on tour, playing major festivals as well as a string of sold out headlining shows in larger and larger venues. [FN6] The constantly evolving Girl Talk live show became the basis for the fourth Girl Talk album, “Feed the Animals.” “Feed the Animals,” Gillis’s most ambitious work to date, was released online by Illegal Art on June 19, 2008, utilizing the “pay-what-you-want” model first implemented by Radiohead for their 2007 album “In Rainbows.” [FN7] Fans who chose to pay ten dollars or more received a compact disc along with an official list of all three hundred twenty-two samples used on “Feed The Animals.” [FN8] Like “Night Ripper,” “Feed the Animals” received an enthusiastic response from critics, earning a spot on many best-albums-of-2008 lists, including year-end lists from Blender Magazine and The Boston Globe. [FN9] Meanwhile, Girl Talk’s live audience has continued to grow, as evidenced by a three-night stint of sold-out shows at New York’s 3000-capacity venue, Terminal 5 in November, 2008. [FN10] In interviews, Gillis explains his method as simply another step down the path that was forged by the musicians, rappers, and producers whose music Girl Talk samples. [FN11] Just as a young guitarist hones his or her craft by “basically collaging together ideas…whether it’s from playing Nirvana songs or blues guitar,” Gillis collages samples together on his laptop computer in what he calls “a very physical extension of that art form.” [FN12] Gillis also sees his work as a sign of the post-Internet times. According to Gillis, consumers growing up in the age of iTunes and YouTube are accustomed to having “a dialogue with the media [they] consume,” often through editing downloaded pictures, making videos, or creating remixes of popular songs.[FN13] II. FAIR USE, OR A LAWSUIT WAITING TO HAPPEN? Along with the critical acclaim, festival appearances, and sold-out shows, Gillis’s success has raised a simple question: is Girl Talk legal? The New York Times referred to “Feed the Animals” as “a lawsuit waiting to happen.” [FN14]Pitchfork Media’s review of “Night Ripper” noted that Girl Talk is “practically begging for court drama.” [FN15] Additionally, both online retailers and physical distributors have expressed their doubts as to Girl Talk’s legal status. Indeed, iTunes and at least one CD distribution company decided to stop carrying “Night Ripper” as a result of growing fears of a Girl Talk-related lawsuit. [FN16] Gillis and his record label, Illegal Art, have chosen to tackle the legal issue head-on, proactively employing a fair use argument in order to defend Gillis’s work from potential litigation. The official bio for “Feed the Animals” distinguishes Girl Talk from “mashups” or DJ mixes, tracks that simply layer one track over another track. [FN17] Gillis claims that the meticulous sampling, pitch-shifting and editing that he employs give Girl Talk tracks “their own character” such that they “surpass the original elements” of the sampled tracks.[FN18] According to the bio, “such transformative work” entitles Gillis to protection under the fair use principle embodied in the U.S. Copyright Act.[FN19] Fair use is a limitation on the exclusive nature of copyright that enables “fair use” of a copyrighted work “for purposes such as criticism, comment, news reporting, teaching…scholarship, or research.” [FN20] Courts evaluate fair use arguments on a case-by-case basis, incorporating four factors into their analysis: (1) “purpose and character of the use,” (2) “the nature of the copyrighted work,” (3) the “amount and substantiality of the portion used,” and (4) the “effect of the use upon the potential market for or value of the copyrighted work.” [FN21] No one factor is dispositive in fair use analysis. As such, courts have broad discretion when evaluating a fair use argument. In Campbell v. Acuff-Rose Music, Inc., the seminal music industry fair use case, rapper Luther Campbell successfully invoked a fair use defense in a case involving 2 Live Crew’s parody of “Oh, Pretty Woman” by Roy Orbison.[FN22] The Supreme Court, reversing the Sixth Circuit Court of Appeals, determined that analysis of the “purpose and character” factor of fair use should be based on whether the new work “merely supersedes the objects” of the original work “or instead adds something new, with a further purpose or different character . . .in other words, whether and to what extent the new work is ‘transformative.’” [FN23] According to Acuff-Rose, “the goal of copyright, to promote science and the arts, is generally furthered by the creation of transformative works.” [FN24]Though not specifically enumerated in the Copyright Act, the court held that parody was such a transformative use. [FN25] However, while the Court held that Campbell’s lyrical parody of “Oh, Pretty Woman” was transformative, the Court remanded the question of whether or not the repeated use of a signature bass riff in the Orbison song was also protected under fair use. [FN26] Recently, the District Court for the Southern District of New York relied on Acuff-Rose’s “transformative use” doctrine in a case involving the unauthorized use of a fifteen-second clip of John Lennon’s “Imagine” in the documentary, “EXPELLED: No Intelligence Allowed.” [FN27] The Court denied the Lennons’ request for a preliminary injunction, holding that the filmmakers’ use of “Imagine” was transformative because the film responded directly, through images and voiceover, to the lyrical content of the chosen excerpt.[FN28] The Lennons eventually dropped their lawsuit. [FN29] Though none of the hundreds of artists sampled on Girl Talk’s albums has gone so far as to bring suit against Gillis, journalists and music bloggers have energetically debated the merits of Gillis’s fair use argument. Idolator music blogger Mike Barthel concluded (based on both “purpose and character” and “amount and substantiality”) that Girl Talk does not pass the fair use test.[FN30] Journalist Evan Davies took the opposite position, comparing Gillis to a young Beethoven, plying his trade “after studying Mozart,” in effect commenting on the work of his predecessors without committing wholesale piracy. [FN31] Additionally, there is no consensus among the attorneys who have chosen to weigh in publicly. Intellectual property attorney Barry Slotnick doesn’t give Gillis’s fair use argument much credence. [FN32] According to Slotnick, while “fair use is a means to allow people to comment on a pre-existing work,” fair use does not allow one to “substitute someone else’s creativity for [his/her] own.” [FN33] While Case Western Reserve University of Law professor Peter Friedman agrees in principle, he claims that Gillis’s re-combination of samples is sufficiently transformative as to qualify as an original work, thus discouraging litigation. [FN34] Because there is no fair use case directly on point with the legal questions raised by Girl Talk, it is necessary to look at how courts have historically handled copyright cases involving sampling in order to evaluate Gillis’s fair use argument. III. SAMPLING AND SPARSE CASE LAW Sampling, the use of a pre-existing clip of recorded music in a new musical work, has been common practice, particularly in hip-hop music, since the late 1980s. Gillis’s style of high-volume sampling hearkens back to some of hip-hop’s earliest innovators such as the Bomb Squad and Prince Paul. The Bomb Squad used dozens of unlicensed samples to create a densely layered sound on seminal hip-hop albums including Public Enemy’s “It Takes a Nation of Millions to Hold Us Back.” [FN35] Prince Paul pulled samples, without permission, from disparate sources including Johnny Cash, Steely Dan and the Turtles in the course of producing De La Soul’s masterpiece, “Three Feet High and Rising.” [FN36] Grand Upright Music Ltd. v. Warner Brothers Records, Inc., the so-called “Biz Markie case,” dealt a crippling blow to this sample-heavy style of production. [FN37] In Grand Upright, the court granted a preliminary injunction halting sales of Biz Markie’s album because of unauthorized use of a sample of a Gilbert O’Sullivan song. [FN38] Grand Upright owned both the composition and sound recording copyrights for the O’Sullivan tune. [FN39] The Biz Markie case had a dramatic impact on the emerging sound of hip hop, effectively ending an era where rappers and producers were able to take full advantage of new digital sampling techniques without fear of legal action. [FN40] As Public Enemy frontman Chuck D noted, his group completely changed its production style, reproducing sounds in the studio and dramatically limiting the number of pre-existing samples in order to avoid a wave of litigation. [FN41]Groups who chose to continue sampling pre-existing recordings did so sparingly, often choosing one “primary” sample per song in order to simplify the process of getting permission, “clearing” samples in order to avoid lawsuits. [FN42] Though courts have heard a number of cases involving sampling and copyright infringement, none of these cases have involved a fair use defense for a non-parodic use of a sound recording. Two recent cases, however, illuminate the continued problems courts have had in formulating a consistent approach to sampling and copyright. In Newton v. Diamond, jazz musician James Newton sued the Beastie Boys for infringing his copyrighted composition through use of a looped three-note sample. The Ninth Circuit applied the “substantial similarity” test for infringement, ultimately holding that the composer’s copyright was not infringed through use of the sample. [FN43] The relatively sensible “substantial similarity” test was immediately rejected by the Sixth Circuit in Bridgeport Music v. Dimension Films. [FN44] The Sixth Circuit’s much-criticized opinion set forth a bright line rule, establishing that sampling from a sound recording “necessarily infringes upon the rights of the owners of both the sound recording itself and the underlying composition.”[FN45] Though the Court’s holding did not explicitly preclude a successful fair use argument, as in Newton v. Diamond, no such argument was made by the defendant. IV. GILLIS’S FAIR USE ARGUMENT IN LIGHT OF INCONSISTENT JUDGMENTS REGARDING SAMPLING How would Gillis’s fair use argument fare in court? The general attitudes towards sampling expressed in Grand Upright [FN46] and in Bridgeport [FN47]suggest that at least some courts would be unreceptive to a fair use argument. Additionally, though Gillis relies on “transformative use” doctrine in making his fair use argument, there simply is no precedent case on point to suggest whether this argument would be successful. Given the sparse case law, Gillis’s argument would depend almost entirely on the opinion of a court as to how “transformative” ought to be defined in this context. Proponents of Gillis’s fair use argument point to Girl Talk’s originality, but much of “Feed the Animals” consists of the juxtaposition of one extremely recognizable sample over another. [FN48] Indeed, it is the many moments of recognition of familiar choruses, hooks, riffs, voices and words that give Girl Talk its appeal. For the most part, Gillis’s transformation takes the form of pitch-shifting, editing, and re-contextualizing his source material. Defining transformation so broadly in the context of fair use is potentially problematic as similar techniques have been common in hip-hop production for years. [FN49] If simply juxtaposing a Jay-Z verse over a pitch-shifted Radiohead sample is transformative, why should hip-hop producers pay for the rights to samples that will ultimately be “transformed” by a rapper’s verse? [FN50] Does Gillis really “comment” on his source material by displacing a chorus, a chord progression, or a beat without adding a significant amount of new material? Additionally, though “Feed the Animals” is made up largely of rapid-fire edits and extremely brief samples, there are numerous instances of samples of significant length, including a 63-second sample of BLACKstreet’s “No Diggity,” a 54-second sample of Missy Elliot’s “Work It,” and a 30-second sample of the Jackson 5’s “ABC.” [FN51] The use of samples incorporating an entire verse and chorus of a song would surely weigh against Gillis under the “amount and substantiality of the portion used” factor of fair use analysis. Again, as Barthel points out [FN52], Gillis’s claim that he only uses short samples in a transformative manner is at the very least doubtful, if not highly dubious. [FN53] However, as a practical matter it is hard to blame Gillis for making a fair use argument. Under current copyright law he is left with three unsatisfying choices: continue to produce Girl Talk albums while clinging to a fair use argument; admit that Girl Talk probably does infringe copyright but continue anyway; or admit that Girl Talk infringes copyright and discontinue the project since complying with current law would be a cost-prohibitive logistical nightmare. V. COMPULSORY LICENSING AND “HIGH-VOLUME” SAMPLING Assuming that Gillis’s fair use argument is likely to fail, the only way he could legally produce Girl Talk albums would be under an amended Copyright Act. One oft-proposed solution that would solve the logistical problems posed by Girl Talk is the so-called compulsory sample license, an idea that has been the subject of law review articles for over a decade. [FN54]Creation of a compulsory sample license would involve amending the Copyright Act in order to create a scheme “roughly analogous to the one currently used for licensing cover versions of copyrighted songs” under Section 115 of the Copyright Act.[FN55] Early compulsory sample license proposals were often criticized for creating an “administratively cumbersome” [FN56] system with regulations no less arbitrary than those already in place. [FN57] Indeed, some proposals included bizarrely arbitrary restrictions. [FN58] Proposals for a compulsory sample license have resurfaced in recent years as sampling, and sampling-related legal issues, have evolved. [FN59] Proposed compulsory sample license schemes have included provisions regarding everything from royalty payments and categorization of sample-based works, to potential limits on sample length and liability issues involving sound recording and compositional copyrights. [FN60] No one, however, has proposed a workable solution for an artist such as Gillis who engages in “high-volume” sampling. Even a “relatively small sum collected per album pressed” (or sold digitally online) would render an album featuring three hundred twenty-two samples financially infeasible. [FN61] One possible solution is to structure royalty rates based on a percentage of revenue generated, as opposed to a flat rate per sample used. Such a scheme would utilize a multi-tiered structure. The overall percentage of royalties paid per track would be determined by a sliding scale based on the number of samples used. [FN62] The division of that royalty revenue would be based on the length of the samples used in order to compensate copyright holders proportionally with the amount of the copyrighted work sampled. This structure would protect the interests of the copyright holder while enabling artists to create sample-based works without having to worry about prohibitive costs. Additionally, this structure is consistent with the constitutionally mandated policy goal of the Copyright Act: promoting “the progress of science and the useful arts.” [FN63] As noted above, Grand Upright abruptly halted the progress of one of the most fertile, creative movements in recent American music history. Amending the Copyright Act in order to allow for high-volume sampling would promote the creation of sample-based works while fairly compensating copyright holders. With the affordability of high-powered laptops and sampling software and the easy access to source material afforded by the Internet, such an amendment could help usher in a new Renaissance of sample-based music by giving sampling artists incentives to create and release new works without the fear of potential litigation or prohibitive preliminary licensing fees. Another, more practical argument is based in the harsh reality of the music industry in 2009. With the entire industry facing an uncertain future in the wake of steadily declining album sales, the music industry should be focused on alternative revenue streams and new monetization schemes. [FN64] Illegal Art released “Feed the Animals” under the Creative Commons Attribution Non-Commercial license, preventing anyone using Girl Talk tracks for derivative works from generating any revenue from that work. [FN65] Besides seeming blatantly hypocritical, this scenario limits the revenue that one of the most talked-about albums of 2008 will generate. Given the current climate of the music industry, such a lost opportunity is unfortunate to say the least. VI. CONCLUSION Though many logistical details would have to be worked out, a compulsory sample license coupled with a royalty scheme based on a percentage of the revenue generated by the sampling work is a workable solution to the problems raised by “Feed the Animals.” Sampling has continued to grow, cross-pollinating genres since its widespread integration into the American musical landscape over twenty years ago. As future generations of musicians grow up with powerful computers and constantly evolving music software, it is likely that many will follow Gillis’s lead. This logical development in music and technology should be accompanied by an analogous development in the laws that protect the rights of copyright holders while encouraging creative works. *** *Staff, UCLA Law Review, Volume 57. J.D. Candidate, UCLA School of Law, 2011; B.A., Manhattan School of Music, 1999. [FN1] Girl Talk, Feed the Animals (Illegal Art 2002). [FN2] Girl Talk, Night Ripper (Illegal Art, June 19, 2008); Girl Talk Bio, http://windishagency.com/artists/girl_talk/bio (last visited Oct. 10, 2009). [FN3] Id. [FN4] Sean Fennessey, Review of “Night Ripper”, Pitchfork Media, Jul. 17, 2006, http://www.pitchforkmedia.com/article/record_review/37357-night-ripper. [FN5] Rob Walker, Mash-Up Model, N.Y. Times, July 20, 2008, §MM (Magazine), at 15. [FN6] Girl Talk Bio, supra note 2.
[FN7] Nicole Martin, Fans Choose to Pay for Radiohead’s ‘Free’ Album, Daily Telegraph (London), Oct. 11, 2007, at 3.
[FN8] Andy Baio, Girl Talk’s Feed the Animals: The Official Sample List, Nov. 10, 2008, http://waxy.org/2008/10/feed_the_animals_official_sample_list/.
[FN9] Metacritic: Best Albums of 2008, http://www.metacritic.com/music/bests/2008.shtml (last visited Oct. 10, 2009).
[FN10] Jon Pareles, Making Girls Dance: All in a Night’s Work, N.Y. Times, Nov. 20, 2008, at C1.
[FN11] Evan Davies, Hail to the Thief, NOW Magazine (Toronto), Nov. 5, 2008 at 1.
[FN14] Walker, supra note 5, at 15.
[FN15] Fennessey, supra note 4.
[FN17] Girl Talk Bio, supra note 2.
[FN19] 17 U.S.C. §107.
[FN22] 510 U.S. 569 (1994).
[FN23] Id. at 579.
[FN26] Id. at 589.
[FN27] Lennon v. Premise Media Corp., L.P., 08 Civ. 3813, Opinion & Order at 1 (S.D.N.Y. June 2, 2008), http://online.wsj.com/public/resources/documents/expelledsdny.pdf.
[FN28] Id. at 12.
[FN29] Dave Itzkoff, Ono, EMI Drop ‘Imagine’ Lawsuit, N.Y. Times, Oct. 9, 2008, at C2.
[FN30] Mike Barthel, Copyfight: Girl Talk is Not Fair Use, Idolator.com, Nov. 10, 2008, http://idolator.com/5081637/girl-talk-is-not-fair-use.
[FN31] Davies, supra note 11, at 1.
[FN32] Robert Levine, Steal This Hook, N.Y. Times, Aug. 7, 2008 at E1.
[FN34] Peter Friedman, Appropriation Can Be Original, What Is Fair Use?, Aug. 14, 2008, http://whatisfairuse.blogspot.com/2008/08/appropriation-can-be-original.html.
[FN35] Stephen Thomas Erlewine, Review of “It Takes a Nation of Millions to Hold Us Back”, AllMusic, http://www.allmusic.com/cg/amg.dll?p=amg&sql=10:0pfixqu5ldhe (last visited Oct. 10, 2009).
[FN36] John Bush, Review of “3 Feet High and Rising”, AllMusic, http://www.allmusic.com/cg/amg.dll?p=amg&sql=10:fpftxqy5ldde (last visited Oct. 10, 2009).
[FN37] 780 F.Supp. 182 (S.D.N.Y. 1991).
[FN39] Id. at 183.
[FN40] Peter Friedman, What, indeed, is fair use?, Ruling Imagination: Law and Creativity, Nov. 13, 2008, http://blogs.geniocity.com/friedman/2008/11/what-indeed-is-fair-use/.
[FN41] Kembrew McLeod, How Copyright Law Changed Hip Hop: An Interview with Public Enemy’s Chuck D and Hank Shocklee, Stay Free Magazine (Issue #20, Fall 2002), available at http://www.stayfreemagazine.org/archives/20/public_enemy.html.
[FN43] 349 F.3d 591 (9th Cir. 2003).
[FN44] 410 F.3d 792 (6th Cir. 2005).
[FN45] Kenneth M. Achenbach, Grey Area: How Recent Developments in Digital Music Production Have Necessitated the Reexamination of Compulsory Licensing for Sample-Based Works, 6 N.C. J.L. & Tech. 187, 199 (2004).
[FN46] Grand Upright, 780 F. Supp. at 183 (“Thou Shalt Not Steal”).
[FN47] Bridgeport Music, Inc., 410 F.3d at 801 (“Get a license or do not sample. We do not see this as stifling creativity in any way.”).
[FN48] Track 1 of “Feed the Animals,” “Play Your Part (Pt.1),” begins with a sample of UGK’s “International Player’s Anthem” over The Spencer Davis Group’s “Gimme Some Lovin.’” Track 3, “Still Here,” features BLACKstreet’s “No Diggity” over Kanye West’s “Flasing Lights.”
[FN49] Ken Micallef, Kanye West, Remix, Feb. 1, 2004 at 2 (Producer/rapper Kanye West discussing his techniques for manipulating the speed and/or pitch of his samples).
[FN50] Track 5 of “Feed the Animals,” “Set It Off,” contains a 40-second clip of Jay-Z’s “Roc Boys” juxtaposed over Radiohead’s “Paranoid Android.”
[FN51] Baio, supra note 8.
[FN52] Barthel, supra note 30.
[FN53] Levine, supra note 32.
[FN54] See, e.g., Michael L. Baroni, A Pirate’s Palette: The Dilemma of Digital Sound Sampling and a Proposed Compulsory License Solution, 11 U. Miami Ent. & Sports L. Rev. 65, 93 (1993).
[FN55] Robert M. Szymanski, Audio Pastiche: Digital Sampling, Intermediate Copying, Fair Use, 3 UCLA Ent. L. Rev. 271, 294 (1996).
[FN56] Id. at 294-295.
[FN57] Lucille M. Ponte, The Emperor Has No Clothes: How Digital Sampling Infringement Cases Are Exposing Weaknesses in Traditional Copyright Law and the Need for Statutory Reform, 43 Am. Bus. L.J. 515, 549 (2006).
[FN58] See, e.g., Baroni, supra note 54 , at 95 (Proposing an arbitrary rule stating that the “maximum allowable taking would be one sample per artist or group sampled from for each sampling artist’s album.”).
[FN59] Achenbach, supra note 45, at 212-221.
[FN61] Id. at 220.
[FN62] For example, a track using 1-5 samples would pay a 10% royalty, a track using 6-10 samples would pay a 15% royalty, and so on. This example is purely for illustrative purposes.
[FN63] U.S. Const . art. I,, § 8, cl. 8.
[FN64] Dawn C. Chmielewski, Digital Music Downloads Set a Record; More than 1 Billion Songs were Purchased Online in 2008. But CD Sales Fell 20%, L.A. Times, Dec. 31, 2008, at C3.
[FN65] TechDirt.com, Why Doesn’t Girl Talk Allow Commercial Use?, http://techdirt.com/articles/20080707/0016231597.shtml (last visited Oct. 10, 2009).
by Josh Kaplan* A pdf version of this article may be downloaded here. In recent years, the music industry has morphed at an alarming pace. The music label system has failed to evolve with equal speed, and the result is the demise of the music label and its surrounding infrastructure. The music label system has traditionally sold physical records at inflated prices while sharing a very small percentage of such sales with the musician. With the advent of digital music, the utilities that the labels possess have become available to any musician with a good internet connection. A band no longer needs a label to manufacture, promote and distribute its new LP. Today’s indie bands are resourceful, and tap into every free and inexpensive resource readily available. Bands utilize websites, social networking tools, street teams, e-stores and digital distribution companies to “break” into the business. Even still, the band needs one thing to take it to a national or international level: money. In the past, artists would access such capital by signing with a label in exchange for a loan, creatively coined an “advance.” The band, excited by the prospect of national exposure, would give the label the rights to its music and its name, with a contractual obligation to provide the label with six to ten more albums. The label would then control the manufacture, release and promotion of the band’s music. Any royalties that the band received from the sale of its music would be credited toward the “advance” that the band initially received from the label. The label would also reimburse itself for expenses incurred in producing and exploiting the record. Consequently, the band would remain in debt for the length of its contract with the label, and sometimes for years after. Physical record sales have been steadily declining for the past decade. Digital sales will soon eclipse physical sales. [FN1] In order to re-capture the bloated advances and investments that labels made in artists’ physical records, labels’ legal departments have constructed the “360 record deal.” In a 360 deal, the label lures a band to sign with the promise of an advance and label support. A percentage of all revenue generated by the band – from record and merchandise sales, touring, licensing, video and book sales, music rights, etc. – goes to the label. Regardless of the amount of money the label spends on the band or the band’s development in activities outside of music, the band (and usually the individual band members) will owe a percentage of its earnings for a set amount of time to the label. The advance that the label initially paid to entice the band to sign still functions as a loan that the band must repay to the label. The new generation of do-it-yourself musicians has an understandably tough time stomaching the terms of a 360 deal. How can a band “take the next step” without signing such a deal? In a recent trend that has emerged from the rubble of the label system, an independent investor looks to capitalize on the work that an independent musician has already accomplished. Recognizing buzz bands as valuable and legitimate start-ups, savvy individuals and companies increasingly try their hands in the music business. They bring with them corporate experience and non-industry lawyers, and have developed new models for signing, developing and exploiting independent bands. The investment model that has been used for decades by most other industries in the United States is thus finally making its way into the stubborn music industry. The best corporate vehicle to establish a partnership between an investor and a musician is the limited liability company (“LLC”). A band will have normally incorporated an LLC prior to soliciting an investment. In this scenario, we will refer to the band’s LLC as “Band LLC,” and assume it is owned jointly by the band members. The investor will also have established a corporate entity through which it will make its investment. We will refer to the investor’s company as “Investor LLC.” A third entity – typically another LLC – will be formed for purposes of the investment. We will call this third entity “Partners LLC.” Band LLC will be the initial owner (i.e. Member) of Partners LLC, and will assign and transfer all of its assets, copyrights, trade names and other intellectual property to the new entity. Band LLC, together with its legal and managerial team, will then determine the amount of ownership it is willing to cede in exchange for Investor LLC’s investment of money into Partners LLC. Let us assume that Band LLC decides to give Investor LLC 25% ownership in Partners LLC in exchange for an investment of $100,000. It is important to note that ownership percentages do not necessarily determine the way that a company’s profits are split. In a risky business investment such as ours, Investor LLC will expect to recoup its capital contribution ($100,000) in Partners LLC plus a preferred return (for example, ten percent of the initial $100,000) before Band LLC receives any distribution of profit. After recoupment, the profits may continue to slant in favor of Investor LLC, but should gradually move toward division based on ownership percentages of Partners LLC. During the time that Investor LLC is receiving all of Partners LLC’s profits, the musicians themselves make ends meet via salary. The members of Band LLC work for Partners LLC by performing, recording, making appearances, and developing new merchandise, and will thus draw a reasonable salary from Partners LLC until Band LLC starts to earn income from Partners LLC’s profit distributions. Depending on the needs of Band LLC, a sizeable percentage of Investor LLC’s capital contribution will cover the living expenses of the band members. Partners LLC will derive its income from the band’s activities. From royalties to touring to licensing to merchandise sales, all income will go into the Partners LLC pot. If Partners LLC is successful, the distribution of profits will enable Investor LLC to fully recoup its capital contribution plus make handsome profit. Investor LLC’s investment will allow Band LLC to purchase equipment, tour, work with a producer, secure a distribution arrangement, and get to the “next level” without falling into the deep debt that would result from a 360 deal. If we take this plan long term, there may be situations where Band LLC requires an additional investment (for example, to record and release a new album). Rather than giving up more and more ownership of Partners LLC, Band LLC can reinstate the same “waterfall” distribution scenario with a preferred return. This will allow an investor to feel more secure in its investment and allow Band LLC to keep the ownership percentage of Partner LLC at the status quo. If the relationship does not go well and Investor LLC does not recoup its investment in Partners LLC, the capital contribution will not function as a loan and Band LLC will not be responsible or liable for repayment. If Band LLC is concerned with partnering with Investor LLC for a long period of time, other distribution terms may be established. For example, once Investor LLC has received a 150% return on its investment, it may be removed as a Member of Partners LLC. Band LLC could also cap the profits of Investor LLC or limit the participation of Investor LLC through this structure. For today’s DIY bands that continue to work tirelessly on developing their music into a viable business, this type of structure may be ideal. It is a true partnership that allows for a lot of flexibility between the investor and the band. It provides a band with capital that is needed to hire a good public relationship firm, purchase advertisements, hire the right producers and properly exploit its music and merchandise, all without the constraints and the bureaucracy of the label system. If handled properly, such an investment structure may be the model for the “new” music industry. *** *Josh Kaplan often acts as a left-brain guide to right brain thinkers. Josh is a business lawyer at Stahl Cowen who focuses on music, entertainment and intellectual property law. Josh regularly works with musicians, producers, djs, artists, filmmakers, writers and designers to protect their work product through entity formation, contract negotiations, license agreements, and copyright and trademark registration. Josh has negotiated on behalf of his clients to place their music in movies, television shows, video games, commercials, webcasts and compilations with other artists. In addition, Josh has extensive experience assisting filmmakers and musicians in their quest for private funding for their film and music projects. Josh regularly negotiates and drafts private placement offerings and all corresponding documents including operating agreements and subscription agreements. Lawyer4musicians.com is Josh’s outlet for his views on the music and film industry. [FN1] Casey Johnston, US Digital Music Sales to Eclipse CDs by 2010, http://arstechnica.com/media/news/2009/08/global-digital-music-sales-to-overtake-physical-by-2016.ars.
By David H. Faux* A pdf version of this article may be downloaded here. I. Introduction The current debate over increased protection for fashion design is largely focused on a dichotomy: whether additional protection is necessary or if it is actually counter-productive for the industry. This dichotomy is false. The proper contrast is between protection of authorship versus protection of reputation. In short, while elite design houses enjoy some tools for protecting their reputations, beginning designers need legislation that will enable them to enforce rights based on notions of authorship. Underlying this article is the assumption that fashion designs deserve copyright protection. Each design has a unique “character,” [FN1] and expresses a point of view. [FN2] Combine these original expressions with the fact that clothing is a tangible form, and it seems obvious that fashion designs are copyrightable material. II. The Current Debate The current debate over design protection revolves around two main writings: the Design Piracy Prohibition Act (the “DPPA” or the “Act”) and “The Piracy Paradox: Innovation and Intellectual Property in Fashion Design.” While the detailed pros and cons of each document are beyond the scope of this article, it is important to give a brief overview of their positions and terms, since they define so much of the current debate. A. The DPPA The DPPA is currently in committee. If passed, it will give copyright protection to designs for three years after first made public. [FN3] This is long enough to conceive, develop, produce, market, and sell a design, perhaps with time left over for brief subsidiary licensing. [FN4] The Act also allows for substantial damages. Recovery for finally adjudicated infringement would amount to “$250,000 or $5 per copy,” giving fashion designers a significant prospect for the lawyer who accepts cases on contingency. [FN5] While each part of the DPPA has its share of controversy, probably the most universal concern is over the definitions of “fashion design” and “apparel.” “Fashion design” is defined as “the appearance as a whole of an article of apparel, including its ornamentation.” [FN6] “Apparel” is defined as “(A) an article of men’s, women’s, or children’s clothing, including undergarments, outerwear, gloves, footwear, and headgear; (B) handbags, purses, and tote bags; (C) belts; and (D) eyeglass frames.” [FN7] B. The Piracy Paradox “The Piracy Paradox” is a 2006 article essentially arguing that “free appropriation” in fashion does not stifle innovation, but “may actually promote innovation and benefit originators.” [FN8] This is accomplished through “induced obsolescence” and “anchoring.” “Induced obsolescence” is where “free appropriation speeds diffusion and induces more rapid obsolescence of fashion designs,” causing a need for more frequent innovation. [FN9] “Anchoring” refers to a process whereby rampant copying within a season helps to define that season’s trends. Consumers follow the trends until another innovation occurs. At this point, rampant copying takes place and a new trend is born. [FN10] Like the DPPA, “The Piracy Paradox” has been quite controversial. In her article, “The Double-Edged Scissor: Legal Protection for Fashion Design,” Emily S. Day sets forth what have become the major critiques of the Piracy Paradox.[FN11] Namely, she states that Raustiala and Sprigman assume incorrectly that “all fashion designs are ‘status goods’ whose brand name is commonly recognized.” [FN12] Second, they also make the false assumption that “the designers themselves could not generate the same economic benefits through intellectual property protection and their own production of ‘copies’ through the use of lower-priced bridge lines.” [FN13] Third, they do not address the problems created when the counterfeits and knockoffs supposedly benefitting the economy are actually “counterfeits and knockoffs of clearly inferior quality.” [FN14] These critiques should be expanded to include another: proponents of the Piracy Paradox assume inferior quality knockoffs of elite-house designs to be qualitatively the same as the design theft by more established, “legitimate” corporations against beginning designers. The significance of this assumption is that if they are not qualitatively the same, then these different offenses likely require different responses. That is to say, elite design houses have established reputations and, thus, can fend for themselves under existing intellectual property law. They already have the resources (relative to what start-up houses have) to pursue those claims. Of course, established houses will not be precluded from the benefit of any legislation that bolsters protection for fashion design. In contrast, the beginning designers require more; they require protection not based exclusively on reputation. This implies a focus wherein fashion design protection should not rest on cheap knockoffs of established brands. Like in the DPPA, protection should address quality knockoffs of designs stolen from the anonymous hopefuls, the nascent designers. III. Different Infringements A. The Policy Against Reputation Infringement The policy against knockoffs is predominantly trademark-based. Trademarks “foster competition and the maintenance of quality by securing to the producer the benefits of good reputation.” [FN15] They help “assure a producer that it (and not an imitating competitor) will reap the financial reputation-related rewards associated with a desirable product.”[FN16] At its most basic level, the significance of a positive commercial reputation is that it makes a market more efficient.[FN17] To wit, consumers need not take too much time shopping for, e.g., tissue paper if they know they will purchase decent quality from Kleenex®. Similarly, when an elite fashion house discovers inferior quality knockoffs of its brands, its main concern is about damage to its good will with the consumers. This reputation-based protection does not address situations where the design is stolen from one prior to establishing her reputation as a nascent designer. Of course, established designers still have whatever copyright, patent, or other laws at their disposals. And because they are established, they not only have reputations, but cash flows superior to nascent designers. In other words, these elite houses are already better situated within existing law to address the infringements that concern them the most. Probably one the most famous court cases of fashion infringement is fifteen years old and took place in France. In Société Yves Saint Laurent Couture S.A. v. Société Louis Dreyfus Retail Mgmt. S.A., Yves Saint Laurent successfully sued Ralph Lauren for infringement of its tuxedo dress. [FN18] But even in the States, the larger names are able to choose their moments to engage civil actions. For instance, Diane von Furstenberg, LP and Ann Sui Corp. have both sued Forever 21, Inc. for various replications of their designs. [FN19] B. The Policy Against Authorship Infringement A nascent designer, by definition, has no reputation. Therefore, the policy behind such protection must arise from a different perspective. The most common foundations for protecting copyrightable work are the “incentive theory” and “natural rights” theories. The “incentive theory,” which, while “the immediate effect . . . is to secure a fair return for an author’s creative labor,” has the ultimate aim of “by this incentive, to stimulate artistic creativity for the general public good.” [FN20] More explicitly, the purpose of copyright law, then, is not to reward the individual artist for her contribution, “not to reward the labor of authors, but ‘to promote the Progress of Science and useful arts.’” [FN21] As such, one significant component of copyright protection is that it lends itself to public benefit rather than market efficiency. The “natural rights” theories have the ultimate aim of fairness towards an originating innovator, in this case the artist. This notion of connecting copyright to an individual’s innovation upon nature comes from John Locke’s Two Treatises of Government. [FN22] Specifically, it is rooted in the notion that when someone applies personal labor to a thing in nature, that thing becomes her property. [FN23] In this way, the Lockean component infuses copyright law with natural rights and fairness, rather than market efficiency. C. The Specific Problem of Authorship Infringement As stated above, the elite fashion houses have recourse against pirates by protecting their reputations through trademark litigation, making their situations remarkably different from the plight of nascent designers. Yet, this difference appears to have been lost on proponents of the Piracy Paradox: they only consider the elite designer’s perspective. Indeed, proponents describe the fashion industry as “a school of fish moving first this way and then that, [wherein] fashion designers follow the lead of other designers in a process that, while bewildering at times, results in the emergence of particular themes.” [FN24] Specifically, though, these proponents state that piracy drives the elite fashion houses towards evermore innovation.[FN25] Supposedly, a trend only “trickles down” from the elite houses to the “less expensive retailers.” [FN26] This belief is flushed out by these proponents’ examples. They quote Miucci Prada as stating, “We let others copy us. And when they do, we drop it.” [FN27] They point out that the Chanel label, though unable to stop other firms from copying its designs, is doing fine as a business. [FN28] Established houses, though, often find innovation among nascent designers. [FN29] It is these designers that need protection through additional legislation. Certainly such instances are well-documented. [FN30] For example, designer Narcisco Rodriguez designed a dress for Carolyn Kennedy that was famously copied before he could make copies of the original designs for himself. [FN31] Day also recounts the story of Ananas, a handbag label whose design by “a young wife and mother working from home, was knocked off. An identical design was offered at a lower price on the Internet. As a direct result, a buyer cancelled his wholesale order and an independent customer bought the cheaper counterfeit version online instead.” [FN32] Clearly, the elite houses and nascent designers have different concerns. IV. Different Reactions Without increased protection for nascent designers, protection will be available only to those who can prove they have purposefully built reputations: trademark holders with the resources available to support a civil suit. This means only established houses currently enjoy protection, at times to the exclusion of their younger competitors. By allowing the established houses the advantages of “free appropriation” while allowing them to defend claims based on reputation, the current law prioritizes an efficient economy over innovation and fairness. Not only does this stunt industry advancements, but it also leads to a facile monopoly. The general consensus states that monopolies, while efficient, [FN33] are outweighed by their imperfections. [FN34] For example, certain industries such as oil, steel, and the railroads, can be best run by monopoly due to the limited nature of the involved resources. Even President Theodore Roosevelt—the grand trust-buster himself—had distinguished between “bad trusts, which gouged consumers, and good trusts, which offered fair prices and good service.” [FN35] Nevertheless, the United States specifically chose a sense of fair competition over efficiency through the Sherman and Clayton Acts, even in the face of finite resources. [FN36] With an industry like fashion design, where the main resource—creativity—is unbounded, it makes even less sense to allow a monopoly, actual or facile. Efficiency aside, a worse economy results when established houses hoard innovation, allowing their influences to trickle down upon the anonymous designers from whom they may have stolen these copyrightable expressions in the first place. Others argue that increased protection via legislation like the DPPA will not have any positive effect on the fashion industry. For example, some say that where better protection exists, such as in the European Union, the fashion designers do not use it. [FN37] One scholar goes further to state that “there is no indication that such protections successfully hinder design piracy.” [FN38]However, any copyright lawyer can relay story after anecdote about clients learning the hard lesson that having rights and enforcing them are two entirely different animals. [FN39] [FN40] If frequency of use were a criterion for enacting a law, the entire Copyright Act would be jeopardized. V. Conclusion Ideally, there would be easier ways to protect fashion designs from piracy. For example, the Copyright Office could have a registry of fashion designs with imagery and a similar keyword/search structure to that used by the Trademark and Patent Office. Perhaps we could determine the exact statutory rewards that would perfectly balance against the risks and upfront costs of litigation. Maybe the correct minimum statutory damages awarded would maintain a low number of weak actions, while allowing the maximum number of bona fide disputes. Whatever the solution, it must involve better access to the courts for nascent designers. In that way, the DPPA is a step in the right direction. Placing increased protection for designs in the realm of copyright opens recourse to those with little to no assets in terms of reputation or finance. Adjusting the typical $150,000 of statutory damages per infringement to $250,000 or $5 per copy may balance the rewards and risks of litigation enough to bring forward bona fide disputes. Thus, both “inferior” and “elite” pirates will be on notice that there is more to success in a good economy than having and using an innovative piece of intellectual property—that property must also be owned by them through authorship or a proper license. *** *David H. Faux practices Intellectual Property, Entertainment, Art, and Business/Commercial Law. His past and present clients include individuals and organizations involved in the fashion, sports & fitness, fine arts, photography, and graphic design industries. In addition to his private practice, he serves as Director of Business Affairs at the Dramatists Guild of America, Inc. Prior to becoming an attorney, Dave spent several years as a music journalist and, then, a publicist in the Northwest. He holds both a Master of Science and Master of Arts degree. He also spent a year in South Korea as a Fulbright Scholar. He is the co-chair of the Fashion Law Committee for the New York State Bar Association’s Entertainment, Arts, and Sports Law Committee. [FN1] See Shelley C. Sacker, Art Is In the Eye of the Beholder: A Recommendation for Tailoring Design Piracy Legislation to Protect Fashion Design and the Public Domain, 35 AIPLA Q.J. 473, 474 (2007) (confirming that it is “well understood that the chief value of a ‘quality’ of dress lies not so much in the quality of the materials as in the smartness and originality of design”). [FN2] MARY GEHLHAR, THE FASHION DESIGNER SURVIVAL GUIDE, 60, Kaplan Publishing (2008), (instructing that a “designer needs a signature point of view to differentiate his line from others and make it special”). [FN3] H.R. 2196, 111th Cong. § 2(d) (2009). [FN4] GEHLHAR, at 36 (stating that a designer should, in October of 2008, “[b]egin designing and ordering fabrics for Fall 2009”); Labels for Less, N.Y. POST, Sept. 2, 2006, at 10 (suggesting designers require eighteen to twenty-four months to express their ideas in sketches and move them to final manufacture). [FN5] H.R. 2196, at § 2(g). [FN6] Id., at § 2(a). [FN7] Id. [FN8] Kal Raustiala & Christopher Sprigman, The Piracy Paradox: Innovation and Intellectual Property in Fashion Design, 92 Va. L. Rev. 1687, 1691 (2006). [FN9] Id., at 1722. [FN10] Id., at 1729. [FN11] Emily S. Day, Double-Edged Scissor: Legal Protection for Fashion Design, 86 N.C.L. Rev. 237 (2007). [FN12] Id., at 260. [FN13] Id. [FN14] Id. [FN15] Park ‘N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 198 (1985). [FN16] Qualitex Co. v. Jacobson Products Co., Inc., 514 U.S. 159, 164 (1995). [FN17] William M. Landes & Richard A. Posner, Trademark Law: An Economic Perspective, 30 J.L. ECON. 265, 275 (1987). [FN18] Société Yves Saint Laurent Couture S.A. v. Société Louis Dreyfus Retail Mgmt. S.A.,  E.C.C. 512, 514 (Trib. Comm.) (Paris). [FN19] Complaint of Plaintiff, Diane von Furstenberg v. Forever 21, No. 07-CV-2413 (SDNY Mar. 23, 2007); Anna Sui v. Forever 21, 2009 U.S. Dist. LEXIS 33044 (SDNY 2009). [FN20] Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156 (1975). [FN21] Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 349 (1991) (quoting U.S. Const. art. 1, § 8, cl. 8). [FN22] Nimmer, on Copyright, §2.02 The Subject Matter of Common Law Copyright. [FN23] JOHN LOCKE, TWO TREATISES OF GOVERNMENT (1690), Chapter V. (Of Property), §27, stating, “Whatsoever then he removes out of the state that nature hath provided and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property.” [FN24] Raustiala & Sprigman, at 1721. [FN25] Anya Jenkins Ferris, Real Art Calls for Real Legislation: An Argument Against Adoption of the Design Piracy Prohibition Act, 26 CARDOZO ARTS & ENT. L.J. 559, 579 (2008); Trademark Law: An Economic Perspective, 30 J.L. ECON. 265, 275 (1987) (asserting that “the fashion industry overall continues to profit and to produce new original lines of apparel”) (emphasis added). [FN26] Laura C. Marshall, Catwalk Copycats: Why Congress Should Adopt a Modified Version of the Design Piracy Prohibition Act, 14 J. INTELL. PROP. L. 305, 313 (2007). [FN27] Raustiala & Sprigman, at 1722 (quoting “The Look of Prada,” IN STYLE MAGAZINE, Sept 2003 at 213). [FN28] Raustiala & Sprigman, at 1723. [FN29] Susan Scafidi, Design Piracy Prohibition Act: Historical Regression, http://www.counterfeitchic.com/2008/03/design_piracy_prohibtion_act_h.php (affirming, “Some big companies have grown wealthy by copying small-scale creative designers, and they don’t particularly want to stop”). [FN30] See Marshall at 306 (stating that “designers at all levels of renown have seen their designs replicated by large companies before the originals even make it onto the retail market” (emphasis added). [FN31] Rosemary Feitelberg, “Schumer Tours Plan to Fight Design Theft,” WOMEN’S WEAR DAILY, Aug. 9 2007, at 12. [FN32] Day, at 2; Marshall, at 313. [FN33] See Mark Cooper, Ph.D., Perspectives on Antitrust Law: Anti trust as Consumer Protection in the New Economy: Lessons from the Microsoft Case, 52 Hastings L.J. 813, 822 (2001) (discussing the theory that monopoly “does not lead inevitably to a bad economic outcome for society. Sometimes an industry develops in such a way that monopoly is not only a likely outcome but a desirable one”); F.M. SCHERER & DAVID ROSS, INDUSTRIAL MARKET STRUCTURE AND ECONOMIC PERFORMANCE, 4, Chicago, Rand McNally (1990) (arguing that “firms need protection from competition before they will bear the risks and costs of invention and innovation, and a monopoly affords an ideal platform for shooting at the rapidly and jerkily moving targets of new technology”). [FN34] See Sidney A. Shapiro and Joseph Tomain, Realizing the Promise of Electricity Deregulation: Article: Rethinking Reform of Electricity Markets, 40 Wake Forest L.Rev. 497, 507-08 (2005) (discussing the problems of utility monopolies as requiring government intervention despite their benefits). [FN35] RON CHERNOW, TITAN: THE LIFE OF JOHN D. ROCKEFELLER, SR. 433 (Vintage Books 1999) (1998); see BRUCE BRINGHURST, ANTITRUST AND THE OIL MONOPOLY: THE STANDARD OIL CASES, 1890-1911 121 (Greenwood Press 1979). [FN36] SHERMAN ACT § 1 et seq. (1890); CLAYTON ACT § 1 ET SEQ. (1914). [FN37] Day at 12-13; Raustiala & Sprigman, at 1740. [FN38] Sacker, at 480. [FN39] E.g., Kimball Tyson, The Illegal Art Exhibit: Art of Exploitation? A Look at the Fair Use Doctrine in Relation to Corporate Degenerate Art, 9 Comp. L. Rev. & Tech. J. 425, 453 (2009) (describing how even corporate lawyers “agree that lawsuits against” potential infringers are rare); Emily Cunningham, Protecting Cuisine Under the Rubric of Intellectual Property Law: Should the Law Play a Bigger Role in the Kitchen?, 9 J. High Tech. L. 21, 41 (2009) (characterizing as rare suits among authors of cookbooks even “in instances in which professional cooks publish recipes that are blatant copies”). [FN40] Julie P. Tsai, Fashioning Protection: A Note on the Protection of Fashion Designs in the United States, 9 LEWIS & CLARK L. REV. 447, 449 (2005).
by Victoria Elman and Cindy Abramson* A pdf version of this article may be downloaded here. American author Elaine Scott has recently filed suit against Scribd, alleging that the social publishing website “shamelessly profits” by encouraging Internet users to illegally share copyrighted books online. [FN1] Scribd enables users to upload a variety of written works much like YouTube enables the uploading of video content. [FN2] The content uploaded to the Scribd website is then accessible and downloadable by anyone who becomes a free member of the site. Scribd claims that its Copyright Management System (“CMS”) goes “beyond the requirements set forth by U.S., UK, and EU law.”[FN3] While the implementation of a copyright filter is not mandated by the Digital Millennium Copyright Act (“DMCA”), [FN4] it has been encouraged by courts in recent litigation determining Internet Service Provider (“ISP”) liability.[FN5] Despite the fact that courts encourage the use of filters, Scott’s second claim alleges that Scribd’s use of the copyrighted work to filter infringing copies itself constitutes “ongoing and permanent” infringement without permission or compensation to the author. [FN6] On one hand, the suit attacks Scribd for allowing the uploading of infringing works; on the other, it claims that Scribd’s attempts to filter the website of these infringing works without explicit permission from the copyright holders is itself infringing. Fair Use? As many commentators have pointed out, the fair use doctrine is likely to hold up in a court of law with respect to this second counterintuitive claim that filtering itself is a copyright violation. [FN7] A key factor in determining fair use is the purpose and character of the alleged infringer’s use. The more transformative, or how different the purpose or function is from the original work, the more likely it is to constitute fair use. Two recent cases suggest that Scribd’s use of copyrighted works to filter is highly transformative. In Perfect 10 v. Amazon, the Ninth Circuit held that the use of thumbnail images for operating a comprehensive search engine was transformative because while the image may have been created to serve an entertaining or aesthetic function, the search engine “transforms the image into a pointer directing a user to a source of information.” [FN8] In A.V. v. iParadigms, the Fourth Circuit held that the use of archiving an essay to check whether other essays are plagiarized was transformative despite the argument that this new use did not add anything to the original work. [FN9] Because Scribd has a strong argument for transformativeness and there is currently no effect on the market for the copyrighted work—in that copyright owners do not sell or license their works for profit in exchange for inclusion in filtering databases—Scribd is likely to win on the grounds of fair use. However, in looking at the purpose of the DMCA and the courts’ encouragement of filtration to remain in compliance, it seems that a court could find instead that the use of a copyrighted work in a filtering database is really no infringement at all. Filtration Systems: The Status Quo Due to the concern in protecting themselves from third party liability under the DMCA, many ISPs have begun to either develop their own filters or to hire third parties to filter their sites for infringing works. Scribd’s CMS is managed in house. [FN10] This system is populated either when a copyright owner submits her work to be included in the database or when Scribd receives a DMCA takedown notice from the copyright holder. [FN11] Once the takedown notice is received by Scribd the company not only removes the infringing work but also creates a reference of that work that is included in the filtering database—the act that Scott alleges is a copyright violation. [FN12] This is a counterintuitive claim in a world where some copyright owners will actually pay for their works to be included in third-party filtering services which then charges additional fees for ISPs to use their service. [FN13] Why Use of a Copyrighted Work in a Filtering Database is Not Infringement In order for the fair use argument to arise, there must be an infringement in the first place. However, it seems that a court could avoid the fair use avenue of analysis altogether in tackling Scott’s counterintuitive claim. One purpose of the DMCA is to provide protection to copyright owners whose works are constantly being infringed on the ever-expanding social networks and sharing sites. Moreover, courts have time and time again looked to filtering systems as a way in which ISPs can avoid third-party liability. If filtering is the best means by which an ISP can protect itself then it should not be prevented from doing so. While not mandated, filtering is seen as a shield against liability. [FN14]Lastly, copyright owners are themselves sending takedown notices urging ISPs to prevent the infringing activity on their websites. One common sense solution to this issue is to view a copyright owner’s takedown notice as constructive authorization for an ISP to proactively prevent the infringing work from being re-posted by using the work (or a reference of the work) in a filtering system. This would not be the first time that a court had to step in to avoid a “confusing, self-contradictory catch-22 situation . . . particularly when there is a much simpler explanation.” [FN15] The Future of Building a Filtering Database There is a seemingly infinite number of copyrighted works that desire protection against infringement. Gaining access to (and thus the ability to filter for) 100% of these works is a challenge impossible to demand of any ISP. Currently, filtering databases are populated by free or paid submissions by copyright holders either directly to an ISP or to a third party filtering operator. In an attempt to expand its database to include works that it knew wanted protection, Scribd chose to expand its database by including in it works for which it had received DMCA takedown notices. As the need and desire for filtering increases so must the size of the database. To limit one’s ability to expand that database would to be to further complicate the growing demands that ISPs stop infringement before it starts. There should be as few hurdles as possible to an ISP’s access to these works, so long as the sole purpose is to filter out infringing content. *** *Victoria Elman received a B.A. from Columbia University and a J.D. from Benjamin N. Cardozo School of Law in 2009 where she was a Notes Editor of the Cardozo Law Review. She will be joining Goodwin Procter this January as an associate in the New York office. Cindy Abramson is an associate in the Litigation Department in the New York office of Morrison & Foerster LLP. She recieved her J.D. from the Benjamin N. Cardozo School of Law in 2009 where she completed concentrations in Intellectual Property and Litigation and was Senior Notes Editor of the Cardozo Arts & Entertainment Law Journal. The views expressed in this article are those of the authors and do not reflect the official policy or position of Morrison & Foerster, LLP. [FN1] Complaint at 4, Scott v. Scribd, No. 4:09-cv-03039 (S.D. Tex. filed Sept. 18, 2009). [FN2] YouTube has also been embroiled in copyright infringement litigation. In 2007, Viacom Inc. sued YouTube and its corporate parent Google Inc. for alleged copyright infringement and sought over $1 billion in damages. SeeFrank Ahrens, Viacom Sues YouTube Over Copyright, Wash. Post, Mar. 14, 2007, at D2, available at http://www.washingtonpost.com/wp-dyn/content/article/2007/03/13/AR2007031300595.html. [FN3] Scribd Copyright Management System, http://www.scribd.com/copyright. [FN4] The DMCA currently provides a safe harbor to ISPs who lack knowledge or apparent knowledge of infringing works and who expeditiously remove an infringing work once knowledge is obtained. 17 U.S.C. § 512(c) (2008). [FN5] See MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 939 (2005) (“This evidence of unlawful objective is given added significance by MGM’s showing that neither company attempted to develop filtering tools or other mechanisms to diminish the infringing activity using their software. While the Ninth Circuit treated the defendants’ failure to develop such tools as irrelevant because they lacked an independent duty to monitor their users’ activity, we think this evidence underscores Grokster’s and StreamCast’s intentional facilitation of their users’ infringement.”). [FN6] Complaint at 9, Scott v. Scribd, No. 4:09-cv-03039 (S.D. Tex. filed Sept. 18, 2009). “Without permission of the authors, Scribd maintains copies of authors’ works for use in a copyright protection system . . . [O]nce a copyrighted work is uploaded to Scribd without . . . permission, the infringement is ongoing and permanent. Even if the work becomes unavailable for download by users, Scribd illegally copies the work into its copyright protection system, without permission or compensation to the author.” [FN7] See Ashby Jones, A Copyright Head-Scratcher, Courtesy of Kiwi Camara, Wall St. J. Law Blog, Oct. 1, 2009, at http://blogs.wsj.com/law/2009/10/01/the-latest-copyright-head-scratcher-courtesy-of-kiwi-camara (last visited Oct. 25, 2009); David Kravets, Lawsuit: Copyright Filtering Technology Infringes, Wired, Sept. 21, 2009, http://www.wired.com/threatlevel/2009/09/infringingfiltering (last visited Oct. 25, 2009). [FN8] Perfect 10, Inc. v. Amazon.com, Inc., 487 F.3d 701, 721 (9th Cir. 2007). [FN9] A.V. v. iParadigms, 562 F.3d 630 (4th Cir. 2009). [FN10] Scribd Copyright Management System, http://www.scribd.com/copyright (last visited Oct. 25, 2009). [FN11] Id. [FN12] Id. [FN13] Audible Magic is one such service that filters copyrighted audio and video works. Audible Magic Protecting Creative Works, http://www.audiblemagic.com/products-services/registration. [FN14] See Grokster, 545 U.S. at 939. [FN15] UMG Recordings, Inc. v. Veoh Networks, Inc., No. CV 07-5744, 2009 U.S. Dist. LEXIS 86932, at *42-43 (C.D. Cal. Sept. 11, 2009) (citing Ellison v. Robertson, 189 F. Supp. 2d 1051, 1061 (C.D. Cal. 2001); Perfect 10, Inc. v. CCBill LLC, 488 F.3d at 1114).