ACTA, short for the Anti-Counterfeiting Trade Agreement, is a multi-party trade agreement being negotiated in secret by the U.S., the states of the European Union and several other nations.  While its name suggests a laudable purpose, the prevention of international trade in counterfeit goods, the secrecy of the negotiations raise cause for concern.  As details leak out about the contents of the proposed treaty, as such details always do, it becomes clear that much more is happening here than one might suppose.  Indeed, these negotiations are being used to undermine the legal system of copyright in place internationally in favor of a one-way system that benefits special interests at the expense (literally) of consumers.  The more we learn, the clearer becomes the need for consumer groups and others interested in fair copyright to “ACTA up” in opposition to these negotiations.

Not everyone is happy with the secrecy of the ACTA negotiations.  This news report tells of a letter written by two US Senators to the US Trade Representative, asking that the text of the proposed treaty be made public.  They cite privacy concerns, issues involving individual civil rights (such as the right to be free from warrant-less searches and seizures) and fundamental changes to the balance struck by international copyright laws.  One major privacy concern is the possibility of border searches, where customs officials would be authorized to look for and seize allegedly infringing goods, even on laptops carried through airports or across borders.

So what else is in ACTA that has Senators Sanders and Brown so incensed?  There is a nice, short summary of the key provisions of the US proposal here on the blog of Canadian law professor Michael Geist.  But I want to focus on a slightly longer report written about ACTA for the Library Copyright Alliance by Janice Pilch of the University of Illinois.  This Issue Brief nicely explains the context and key provisions being discussed in the ACTA negotiations, and it focuses on the specific concerns of libraries.

Two things particularly struck me in Pilch’s analysis of ACTA.  The first is the harm it could do to technological innovation.  As is often the case, the US Trade Representative apparently sees himself as an agent for the major entertainment industries, and is willing to sacrifice other, developing business models to the protection of their interests.  This is clear in the concern that ACTA will unfairly impose liability for copyright infringement on Internet Service Providers whenever their networks are used to transmit infringing content.  ACTA seems to carry a “three strikes” provision that would require disconnection of Internet users whenever there have been three accusations (not proof) of infringement.  The result would, at least, be a loss of business for ISP and a real fear of developing new communication technologies because of the threat of liability for how those technologies are used.  Worse, some suggested provisions would encourage ISPs to monitor user content and report suspected infringement.  As Pilch notes, the Library Copyright Alliance is asking that ACTA focus on commercial counterfeiting and not penalize particular technologies for the way they are sometimes used.

To me an even bigger concern is that ACTA represents a forum shift in international copyright regulation.  When I was in law school, we spent a lot of time discussing how our procedural rules were intended to prevent “forum shopping” — seeking a sympathetic court even if the area in which that court sat had little connection to the issue involved.  Forum shopping is often costly and unfair, and US jurisdictional rules discourage it.  But in a similar way, the US Trade Representative and the legacy content companies have been forum shopping internationally for a while now.  Pilch recounts the way industrialized nations moved toward international forums like the World Intellectual Property Organization in order to force stronger IP rules on developing nations and are now moving to these multi-party agreements because of the perception that those nations have gained too much influence at  WIPO.  The goal seems to be to find a way to continue to treat developing nations as markets rather than partners, whose own need for technological innovation and infrastructure development are subordinated to the desire to protect the sales of traditional goods produced by the industrial nations.  Such forum shopping also undermines the democratic process, since it uses trade agreements, which do not require legislative approval, to enforce rules the legislature is unwilling to enact into law.

ACTA raises a lot of serious concerns for consumers, fair copyright advocates and those concerned about international development.  Like many other similar attempts to make law behind closed doors, this is an effort where sunlight and transparency is badly needed.

Some copyright cases just don’t grab one’s attention, and I have to admit that I saw reports of the decision in Omega v. Costco several times before the potential impact on academic libraries began to sink in.  The case involves chapter 6 of the Copyright Act, referred to as the manufacturing clauses.  Since the principle requirement of the chapter, that works be manufactured in the US in order to be eligible for copyright protection, expired in 1986, I pretty much ignored the case the first few times I read about it.  Now I think that was a mistake.

The case is fairly complicated, and there is a nice summary of it here, on the IP Law blog.  The basic ruling, however, from the Ninth Circuit Court of Appeals, was that the doctrine of first sale, the rule that says that one who purchases a lawfully made copy of a copyrighted work may lend, resell, or otherwise dispose of that particular copy, does not apply to works that are manufactured and sold outside the US.  Basically, the court held, on reasonably good authority, that such works do not qualify as “lawfully made under this title (i.e. the Copyright Act),” which is a condition on the application of first sale.

Once I paid attention, it became very clear why this is a cause for concern in libraries.  Academic libraries especially buy lots of foreign materials, often from overseas distributors.  If first sale does not apply to those materials, can libraries lend them at all?  A negative answer could devastate our services in support of all kinds of language programs and area studies.  This possibility is raised in passing in this amicus brief urging the Supreme Court to review the case, filed by the Electronic Frontier Foundation.  Interestingly, however, the major library associations have not taken a position on the petition asking the Supremes to hear the case.  I was given two different reasons for this decision not to act, one which seems sound to me and one which leaves me with some concern.

One reason for not encouraging the Supreme Court to “take cert” (that is, agree to review the lower court’s opinion) is that there is real danger that the Supreme Court would affirm the decision.  That would make a problematic case from the West coast into binding law throughout the country.  Better, perhaps, that this remain an anomalous precedent only impacting libraries in the nine western states that comprise the Ninth Circuit.  Several authorities (Patry on Copyright and a concurring opinion in an earlier Supreme Court case) seem to support the position taken by the appeals court, and asking for cert might be asking for trouble.

More reassuring, but more problematic, is the other reason given for not taking action on this case — the exception for libraries that is built into the manufacturing clauses.  Section 602(a)(3) excludes certain copies purchased by libraries for lending or archival purposes from the general statement in 602 that importation of copies of copyrighted works purchased overseas into the US is an infringement of the distribution right.  That seems to let libraries off the hook.  But it is not entirely clear that this exception, specific as it is to section 602, actually solves the first sale problem created by the Ninth Circuit.  Even if it does, however, I am left with two concerns.

First, the section 602(a)(3) exception explicitly excludes audiovisual works from its scope.  For those works, only a single copy for archival purposes is allowed, and no mention of lending is made.  This suggests that even if print collections of foreign materials purchased overseas are OK, collections of film are not.  That would be a crippling lacunae for academic libraries.

The other problem is that, if the Ninth Circuit ruling stands, it might encourage textbook publishers to move their manufacturing and distributing operations overseas in order to be able to shut down secondary markets and thereby increase their profits.  The exception for libraries would not apply to resale of used textbooks, on which so many students depend to reduce their educational costs.  Closing off those used book markets would not directly harm academic libraries, but it would certainly hurt higher education.  Also, it hardly seems sensible to add to the incentives that are luring American manufacturing overseas.

I am thus left on the horns of a dilemma.  I want to see this decision overturned, but I agree that the review that would be necessary to reverse it would also carry a significant risk of an affirmation, which would be far worse.  It is an uncomfortable place to be, and one in which a good outcome is difficult to imagine.

The World Economic Forum recently published its 2009 Global Competitiveness Report, and I was struck by one particular statistic, as well as the conclusion drawn from it by the US Chamber of Commerce.  One of the many statistical tables in the WEF report ranks the perceived strength of national protection for intellectual property.  The United States ranks 19th on this chart, out of 133 countries rated.  As this blog post from IP Watch reports, that ranking prompted The US Chamber of Commerce to call for stronger protection measures in the US.

As someone who believes that IP protection in the US is certainly strong enough and is often over-enforced, I was struck by several flaws in the reasoning of the Chamber of Commerce or, at least, differences about what I think the report could mean.

First, the Chamber of Commerce thinks that 19 out of 133 is a low ranking, a judgment that seems questionable at best.

Second, it is important to note that this chart reports “executive perceptions” about the strength of IP protection in a country.  While that may make sense for a report about international competitiveness, it is too subjective a measure to cause Congress to hasten to strengthen our copyright laws.

Finally, I wonder how strength of IP protection actually correlates to economic growth.  There is a pretty good correlation between perceived strength of protection and competitiveness in the WEF report, but of course, those books are cooked, since the results of the survey are part of the data on which conclusions are based.  I decided to try an experiment, which even as a non-economist I recognize to be crude, albeit interesting.  I started with this list of countries based on economic growth (the growth rate of the Gross Domestic Product) using data from the CIA World Fact Book.  The US is 67th in GDP growth rate, and I made a list of ten countries from the G-20 group of nations with higher growth rates than that of the US and compared that list of ten countries to the rankings of perceived strength of IP protection.  All ten of these countries, it turns out, are perceived to have weaker IP protection than the US.  To choose an obvious example, China has the fastest economic growth rate of any of the G-20 economies, but is ranked far below the US — at 61st — on the list of strong IP protectors.

It is easy to lie with statistics, of course, but this simple comparison suggests that weaker IP protections might actually correlate with economic growth, or that in any case there is a median position where IP protection is correctly calibrated to encourage economic growth, and the US has passed that point.  This search for the correct level of protection, I think, is something the World Intellectual Property Organization is struggling with as it considers its “development agenda” recommendations.  At the very least, nations need to preserve flexibility in their IP laws and recognize that the what is best for Big Content is not necessarily good for a nation.

Back in April, when I was writing about the experiences I had at the eIFL-IP conference in Istanbul, I referred several times to the “Draft Law on Copyright, Including Model Exceptions and Limitations for Libraries and Consumers.”  A copy of the Draft Law was distributed to the IP Conference participants “hot off the presses.”  When I mentioned it back in April, I promised to provide a link as soon as it became available on the eIFL website.  I am now delighted to be able to direct folks to the full text of the Draft Law, available as a PDF and soon to have an HTML version accompanying for easy browsing.

The goal of the Draft Law is to provide librarians and their legal advisers with practical ideas to help them  understand and influence the policy making process when national copyright laws are being revised.  It is directed toward developing countries, from which the majority of eIFL’s membership is drawn.  But there is much for all of us, in the US and the EU as in the developing world, to learn from this document.  Its clear set of definitions and the explanatory notes that accompany each exception and limitation make it ideal for gaining a synoptic view of the state of international copyright law.  Most important is the consistent focus on the public interest and the socially beneficial purpose that copyright law is intended to serve.

It has become a regular complaint about international copyright law that great strides have been made in harmonizing the levels of protection for intellectual property around the globe, but little effort has been made to harmonize limitations and exceptions.  Indeed industry lobbyists and even the U.S. Trade Representative often pressure developing countries to adopt draconian levels of IP protection while encouraging them to ignore or drastically limit the role of limitations and exceptions.  The result is often that copyright law becomes an obstacle to intellectual and creative development in many countries.  The World Intellectual Property Organization has seemed to awaken to this problem over the past two years, and has recently included copyright limitations and exceptions as part of its discussion, especially in the context of it’s so-called “development agenda.”   The eIFL Draft Law is an important contribution to this vital discussion, especially because it offers model limitations and exceptions that are designed to facilitate access to knowledge and the public interest.  It is a document that deserves study in both the developing and the developed world as we consider how IP law can serve its purpose of encouraging learning and creativity rather than stifling them.