New Papers in Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology, bepress)

Announcing new papers in Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology), part of the bepress Legal Repository found at http://law.bepress.com/repository .

PUBLISHER: The Berkeley Electronic Press

EDITORS:

Peter S. Menell - Professor of Law, UC Berkeley Boalt Hall School of Law and Director, BCLT Robert P. Merges - Wilson Sonsini Professor of Law, UC Berkeley Boalt Hall School of Law and Director, BCLT Pamela Samuelson - Professor of Information Management & Law, UC Berkeley SIMS & Boalt Hall School of Law and Director, BCLT Howard A. Shelanski - Professor of Law, UC Berkeley Boalt Hall School of Law and Director, BCLT

TABLE OF CONTENTS:

Robert P. Merges "A Transactional View of Property Rights".

Pam Samuelson, Deirdre K. Mulligan, and Jack Lerner "Brief of 60 Technology Law Professors and USACM".

Peter S. Menell "Indirect Copyright Liability: A Re-examination of Sony’s Staple Article of Commerce Doctrine".

Giuseppe Mazziotti "Did Apple’s refusal to license proprietary information enabling interoperability with its iPod music player constitute an abuse under Article 82 of the EC Treaty?".

Abstracts...

Robert P. Merges, "A Transactional View of Property Rights" (April 19, 2005). Berkeley Center for Law and Technology. Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology). Working Paper 8.

Abstract:

Property rights and contract law are two of our most basic legal categories Many legal scholars describe what makes them different; this Essay describes how they work together to promote economic exchange. Incorporating the insights of both "transaction cost" and "new property rights" economics, it identifies two crucial contributions that property rights make to real-world contracting: (1) precontractual liability, or protection for disclosure of sensitive information in the period leading up to contract formation; and (2) enforcement flexibility after a contract is executed, in the form of many subtle but important advantages that accrue to a contracting party who also holds a property right. This Essay argues that property's "transactional" role is growing in importance, as the "new economy" ushers in a more transaction-intensive industrial structure featuring greater numbers of smaller, more specialized firms.

Pam Samuelson, Deirdre K. Mulligan, and Jack Lerner, "Brief of 60 Technology Law Professors and USACM" (March 29, 2005). Berkeley Center for Law and Technology. Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology). Working Paper 7.

Abstract:

On March 1, 2005, the Samuelson Clinic filed a brief amicus curiae in the US. Supreme Court in MGM v. Grokster on behalf of 60 law professors and the U.S. Public Policy Committee of the Association for Computing Machinery. USACM is the world's oldest and largest international scientific and educational organization composed of 78,000 computing professionals dedicated to advancing the arts, sciences, and applications of information technology.

The brief argues that this case is fundamentally about technology policy, not about file sharing or copyright infringement. Each of the alternative secondary liability standards for which the petitioners and others argue would dramatically change the balance of power between the entertainment and the technology industries (despite the absence of a statutory basis in copyright law for this change), and would disrupt settled expectations in the information technology industry. For more than 20 years, both the technology and entertainment industries have experienced unprecedented technological innovation and economic prosperity under the fundamental framework created by the Sony rule that developers are not secondarily liable when the technologies they create are capable of substantial non-infringing uses. The alternative tests for secondary liability proposed by the petitioners and various amici would upset settled expectations and mire the courts in subjective reviews of new technologiesa recipe for instability and confusion that would severely impair innovation and technological development. The brief further argues that the Sony rule has prevented the very confusion and instability in copyright that, in the patent context, led to Congress's enactment of the staple article of commerce rule. Prior to the enactment of 35 U.S.C. § 271, secondary liability in patent law was decided on a case-by-case basis, and various courts imposed different liability standards, creating instability and uncertainty in patent law. Section 271 was added to the patent statute to clarify and stabilize secondary liability rules, and it has been largely successful in doing so - just as Sony has been in the copyright context. Finally, the brief argues that only Congress has the institutional competence to craft rules that address new technological developments such as the peer-to-peer file-sharing phenomenon.

Peter S. Menell, "Indirect Copyright Liability: A Re-examination of Sony’s Staple Article of Commerce Doctrine" (March 10, 2005). Berkeley Center for Law and Technology. Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology). Working Paper 6.

Abstract:

This article is based on an amicus brief filed in METRO-GOLDWYN-MAYER STUDIOS INC., et al., v. GROKSTER, LTD., a case before the U.S. Supreme Court addressing indirect copyright liability for distribution of software that facilitates file sharing on peer-to-peer (P2P) networks. This case turns on whether the Supreme Court's landmark decision in Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417 (1984), effectively immunizes the software distributors in this case from contributory or vicarious liability on the grounds that such software is capable of substantial non-infringing use. The article re-examines Sony's jurisprudential foundation. In that case, the Court transplanted an express categorical limitation on indirect liability from the Patent Act into the Copyright Act, notwithstanding that Congress had only recently reformed the Copyright Act without including any such limitation on liability among the many express exemptions, limitations, and immunities contained in the statute. Furthermore, Congress reaffirmed the continued applicability and evolution of infringement standards through case-by-case adjudication. The Sony decision failed to examine the important differences between patent and copyright protection. Whereas patent law seeks to promote technological innovation and evolved a staple article of commerce doctrine primarily out of concern for unduly expanding patent scope, copyright law seeks to promote cultural and social progress, manifesting a more cautious stance toward technological dissemination, particularly where a technology threatens widespread piracy of expressive works. Products that encourage patent infringement do not threaten harm beyond a single patent or cluster of patents, whereas the technology at issue in the Grokster case threatens systemic harm to the copyright system by promoting rampant unauthorized distribution of all manner of works of authorship. Therefore, the uncritical transplantation of Patent Act's immunity for dual-use technologies into the Copyright Act poses grave dangers that were beyond the Supreme Court's view when it decided the Sony case in 1984, before the digital revolution took hold. Furthermore, amendments to the Copyright Act since the Sony decision demonstrate that Congress does not believe that dual-use technology i.e., technology that is capable of both infringing and substantial non-infringing uses should be treated as inviolate under copyright law. Rather, Congress has shown that it sees a need to balance the efficacy of the copyright system for promoting creative expression against social interests in technological innovation and consumer autonomy.

Giuseppe Mazziotti, "Did Apple’s refusal to license proprietary information enabling interoperability with its iPod music player constitute an abuse under Article 82 of the EC Treaty?" (March 8, 2005). Berkeley Center for Law and Technology. Law and Technology Scholarship (Selected by the Berkeley Center for Law & Technology). Working Paper 5.

Abstract:

This article concerns the decision taken in November 2004 by the French Competition Authority on Apple's refusal to license its digital rights management (DRM) technology to a competitor in the downstream market for music downloads. The analysis herein finds that neither the indispensability test spelled out in the Magill/IMS doctrine nor the new, controversial test advocated by the EU Commission for compulsory licensing of interoperability information in the 2004 Microsoft decision was applicable to the leveraging by Apple of its proprietary DRM technology into the music downloads market. The article draws on this analysis of the case to show that property rights and trade secrets in respect of DRM technologies have the potential to establish a "bottleneck" between content providers and media player manufacturers in the near future. To avoid such a bottleneck, the conclusions of the article suggest that interoperability and competition may be structurally supported and pursued either by more permissive "reverse-engineering" exceptions in the field of DRM software protection or, more effectively, by the collective establishment of an open DRM standard. In the absence of these structural remedies, compulsory licensing of proprietary DRM technology should remain subject to the "exceptional circumstances" doctrine made famous in the Magill judgment. Forthcoming in: World Competition, Kluwer Law International, June 2005.