Happy Birthday and extended collective licensing

I had not intended to write about the case decided last month involving the claim by Warner/Chappell Music that they owned the copyright in the song “Happy Birthday To You.”  I figured that it would be so widely covered that I would have little to contribute.  Obviously I have changed my mind, and it is partly because of the nature of the coverage I have seen.

Consider this story from Reuters, which says that the judge in the case ruled that Warner/Chappell Music does not hold a valid copyright in the song, and that that ruling puts “Happy Birthday To You” in the public domain.  Unfortunately, this is only half right.  The decision is complicated and careful, making a number of important distinctions, as legal arguments must always do.  The court held, in fact, that the tune to “Happy Birthday,” originally written for a song called “Good Morning To You,” is in the public domain.  But about the lyrics to “Happy Birthday,” the court remained uncertain. Judge George King held that there is no evidence that Warner/Chappell Music ever received a valid transfer of rights in the lyric, so they are not the legitimate copyright holder, but he lacked sufficient evidence to determine the status of the lyrics with certainty.  The decision lists several possible scenarios, including that the lyric is itself in the public domain, but it also acknowledges the possibility that the song is owned by someone who is either unknown or not able to be found.

In short, the lyric to “Happy Birthday to You” was found to be an orphan work, although the court didn’t put it that way.  This is a scenario familiar to most folks in the library community, where we can gather some evidence about ownership of a work, but cannot arrive at a definitive conclusion about the existence of rights, or the ownership of them if they do exist.  There is a nice discussion here of the problems involved in proving that one owns an older copyright, as in this case, by Laura Quilter from U. Mass Amherst.  But what really interests me about the situation uncovered in this decision is how it reflects on the proposals being floated by the Copyright Office to address the orphan work problem through extended collective licensing.

The Copyright Office scheme would require users to pay a set licensing fee to a collective rights management organization (CRO) if they wanted to use a putative orphan work.  The CRO would then be responsible to make reasonably diligent efforts to find a rights holder.  If a rights holder was found, licensing revenue would be disbursed by the CRO.  If an owner could not be found, the money would eventually be dedicated to some fund for the benefit of creative artists and, of course, to the maintenance of the CRO’s own bureaucracy.

Two things we can be sure of about this proposal.  One is that it would create a bureaucracy which would inevitable take its own maintenance and support as a top priority.  It is well-documented that such agencies have high overhead and pay out relatively low amounts to artists, even in situations where those artists are known or easy to identify.  The second thing I think we can be sure of is that this scheme would reduce the role of fair use in mass digitization projects.  Even if the shame included a so-called savings clause for fair use, the existence of a licensing scheme, even when the purported licensor does not actually hold the rights, would chill efforts to apply fair use to many projects.

With that background in mind, what does the “Happy Birthday” decision add to our think about this ECL proposal?

First, let’s think about the situation that lead to the case, where Warner/Chappell music was collecting licensing fees without any valid claim of ownership in the “Happy Birthday” song.  I am not asserting that Warner/Chappell Music was necessarily acting in bad faith; they had some reasons to believe they were valid rights holders, but those were dismantled in the court’s opinion.  Nevertheless, for many years users paid fees that we now believe were unnecessary, and fair use was badly curtailed, especially in things like documentary films, by litigation threats.  This situation would be replicated under the Copyright Office’s ECL plan.  Users would be paying fees to a licensor that did not actually hold rights, so those fees would be a pure loss in the economic realm of copyright (although they would support the creation of an otherwise unnecessary bureaucracy).  In the same way as with “Happy Birthday,” the availability of a putative licensor would have a chilling effect on fair use, especially where the use would be publicly accessible, as with documentary films, in the case of “Happy Birthday,” or mass digitization projects, in the case of libraries.  The upshot of both situations is the same — economic loss without any real public benefit.

The second consideration we can glean from the “Happy Birthday” case is about just how hard it is to determine the rights holders for many orphan works.  With all the powers of discovery and subpoena that were available to the court, it was unable to determine if the “Happy Birthday” lyrics were in the public domain, or, if they are still owned by someone, who that owner might be.  In a ECL scheme this problem would exist both for users and for the CRO, and it is severe enough to render the whole plan inefficient and unworkable.  If users were required to make some determinations before applying for such a license, that would increase the cost of every project without producing much in the way of useful results; many situations, as with “Happy Birthday,” could require tremendous investment of resources without bearing any fruit.  On the other side, the CRO would be unlikely, in similar situations, to ever actually find a rights holder to pay.  Here too, lots of resources (provided by the users) could easily be wasted in fruitless quests for rights holders.  And, of course, any leftover money would equally be wasted by providing for the expenses of an organization that would be unneeded and unable to fulfill its purpose.

If we take a serious look at what happened in the “Happy Birthday” case, where a putative rights holder was found to be collecting fees for something they did not own, and the actual rights situation was found to be undeterminable even after all of the discovery at the power of the court was exhausted, we should see an object lesson in what a bad idea, economically, an extended collective licensing scheme for orphan works would be.  Fair use is a workable and economically much more efficient approach to digitization projects that involve orphan works.

One thought on “Happy Birthday and extended collective licensing”

  1. In the latest Second Circuit’s decision in the Google’s Book case, how do you view the role of extended collective licensing. Basically, this question stems from my struggle to comprehend as to how exactly can readers gain access to full scanned copies of the books digitized by Google. Two options come to my mind –
    (a) Either by entering into a license agreement with Google wherein royalty is provided to authors (how will the specifics of the license play out is something not very clear to my otherwise copyright sharpened eyes). OR
    (b) By entering into a license agreement with the participating libraries.

    Assuming, that none of the above two options is viable and readers have no access to the full scanned copies, does this not raise eye brows to the utilitarian value of Google’s Library Project.

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