Cyberlaw Central

I was referred to a nice article by Declan McCullagh outlining the implications of a new “Policy Document” released by the FCC late last Friday, Sept. 23rd.

The FCC has come up with the following four pronged set of principles that will govern any new Internet policy it develops:

Moreover, to ensure that broadband networks are widely deployed, open, affordable, and accessible to all consumers, the Commission adopts the following principles:
• To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to access the lawful Internet content of their choice.
• To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to run applications and use services of their choice, subject to the needs of law enforcement.
• To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to connect their choice of legal devices that do not harm the network.
• To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to competition among network providers, application and service providers, and content providers.

Pay close attention to the end of #2 – Consumers can use whatever software and Internet services they want, provided that law enforcement has a back door into that software that it can use as needed. Wow.

At the same time, the FCC announced its rule implementing a longstanding request (from law enforcement) to extend the Federal wiretapping rules from telephones to the Internet. When Congress last touched the issue, it had expressly *NOT* extended the rule to broadband providers. Now, the FCC is trying to do it without Congress’ help.

Declan’s not the only one to notice this obscure little pronouncement from the FCC. The Electronic Frontier Foundation (EFF) has announced its plans to sue when the final rules are officially published.

“A tech mandate requiring backdoors in the Internet endangers the privacy of innocent people, stifles innovation, and risks the Internet as a forum for free and open expression,” said Kurt Opsahl, EFF staff attorney.

I couldn’t have said it better myself.

The recent filing of a lawsuit over Google’s new planned Google Print program has raised the bar from an academic discussion of whether the program violates copyright into a full-fledged dispute.

There has been some interesting and well-reasoned discussion about it. Fred Von Lohmann of the EFF analyzed it from a fair-use point of view. Eric Goldman also has a good post on it. I fully agree with his comments about the weakness of relying on fair use in your business model. It’s not a fully fleshed-out doctrine, so your business plan may come into conflict with a new legal development faster than you can react by changing your business model.

I also can’t miss citing William Patry’s excellent discussion of the issues involved with the mere scanning and creation of the database Google will be working from. I wish I had the time to write as deeply and thoroughly about issues as he does on a regular basis.

The questions I have now are as follows:
1) Is Google’s entire business plan faulty, even for the search engine side of its business?
2) Do publishing companies have the proper rights to agree to the full-text indexing of its author’s books? Even if it is opt-in for works still protected under copyright, Google will need to make sure that the right people are providing the consent.
3) Will this case settle?

Stay tuned!

An interesting decision from the 8th Circuit, Davidson involves an appeal from the grant of summary judgment to the plaintiffs.

Davidson does business as Blizzard Entertainment, Inc., creator of popular online cooperative games like Warcraft II. In order to play a game like Warcraft II online, Blizzard’s game connects to its Battle.net servers with a secret handshake. Among other purposes, this handshake makes sure that the computer is running a legitimate copy of the game. In order to use the game, users must agree to both an End User License Agreement (“EULA”) and Terms of Use (“TOU”). Relevant to this case are the parts of both the EULA and TOU where the user agrees not to reverse engineer the software.

Defendants (two computer programmers, a systems administrator and an ISP) wanted to create their own servers where people could play Blizzard’s games. To do this, they reverse engineered the secret handshake between the game and the Battle.net server. Their version, which they released as open source software, did not authenticate the end user’s copy of the game. As a result, unauthorized copies of Blizzard’s games were allowed to play on Defendants’ servers.

At the district court level, many of the issues were resolved by a consent decree. The remaining issues were whether the reverse engineering violated the DMCA as well as several contract claims. The district court found that by conducting this reverse engineering, the defendants had violated EULA and TOU agreed to when the software was loaded. Plaintiffs were granted summary judgment on the DMCA and the contract claims, and then Defendants appealed to the 8th Circuit.

The DMCA claims involve two sections of the Copyright Act of 1976. 1201(a)(1) prohibits circumvention of a technological measure designed that “effectively controls access” to a work protected under copyright. 1201(a)(2) and 1201(b)(1) prohibits trafficking in or otherwise distributing a technological measure that “effectively controls access” to a work protected by copyright, or trafficking in technology that circumvents a technological measure “that effectively protects a right of a copyright owner.”

Defendants argued that they did not circumvent because the secret handshake is a strictly functional process that lacked creative expression, and therefore not protected by copyright. They relied on the recent Lexmark decision, in which the 6th Circuit held that there was no infringement of the code contained inside printer toner cartridges to assure they were authentic Lexmark replacement cartridges. The court disagreed with this approach. Unlike Lexmark, the secret handshake code was not freely available, in fact it had to be reverse engineered. Since the Defendants had agreed to the terms of the EULA and TOU that prohibited reverse engineering, the summary judgment on the breach of contract claims were proper.

Cyberlaw Central Comment:

This decision has been derided by several commentators, including the EFF. I’ve also read the amicus brief filed by a group of intellectual property law professors in support of the Defendants. The major grief seems to be that it harms innovation in the “add-on” software field by enforcing EULA’s that prohibit the user from using rights that would otherwise be available. My take is that this is the wrong case to argue that it is stifling innovation. The right to control where copyrighted works are publicly performed is one of the rights specifically reserved to the copyright holder under 17 U.S.C.A. §106. Davidson had every right to stop the Defendants from creating an alternate forum for playing the game. I also disagree with the criticism of EULA’s. So many software programs come with EULA’s these days that you have to agree to in order to use the software. Prohibiting reverse engineering of a commercial gaming software program isn’t one of the seven deadly sins in my book. I think it’s the right outcome, we’ll see if the reasoning used here survives scrutiny in other cases. I doubt this one is worthy of Supreme Court review.