Supreme Court Deathmatch: Aereo vs. The Entire Broadcast Network Industry

For the last six months, a friend of mine has relentlessly tried to get me to ditch my Xfinity hookup and replace it with Aereo, an online TV subscription service. To hear him tell it, it’s the greatest thing ever invented - immediate and live access to broadcast news, sports, and TV shows from the big 10 networks such as NBC, CBS, ABC, FOX, PBS (no cable channels though), all for a measly $8 a month. I think I’ll wait though. I’m happy with my yesteryear technology and I derive a certain amount of comfort from mindlessly flipping through hundreds of channels I’ll never watch. More importantly, Aereo may not even exist in six months. That’s because tomorrow the Supreme Court will hear oral arguments in the case of American Broadcasting Companies, Inc. v. Aereo, Inc. And if Aereo loses, according to its own CEO, the company is kaput.

For those who don’t know, Aereo is a startup that takes television broadcasts from networks and retransmits them to you live via the internet. You can also store these broadcasts in a cloud-based DVR, all for the cost of two cups of coffee. As it turns out, even though you’re paying Aereo, Aereo is not paying the networks; it's just ripping these broadcast signals out of the air and streaming them to you. That didn’t make the networks too happy, so they banded together and sued Aereo for copyright infringement.

This isn’t an easy case and I don’t envy the justices the amount of work they'll have to even understand the technology at play (read this article if you want to know how behind-the-times the SCOTUS really is). Ultimately, this case turns on whether Aereo’s retransmission of broadcast television constitutes a “public or private performance” of copyrighted works. Private performance is perfectly legal, like when you buy a DVD and show it in your home. Even if you invite 100 friends over to watch, you’re safe. But let’s say you rent a theater and charge for admission - that would make the performance public, and that becomes copyright infringement.

In this case, the networks argue that Aereo’s actions constitute public performance because:

1. Aereo streams “live TV” to a wide variety of subscribers;
2. Aereo charges fees for its services;
3. Unlike other retransmitters, Aereo doesn’t pay licensing fees to the networks for permission to broadcast their content.

In opposition, Aereo argues that it does not transmit “to the public.” It transmits only to its paying user base. Furthermore, the choice about what gets retransmitted at any given time is made by the subscriber, not Aereo. Some lower courts have already sided with Aereo, but if I’m being totally honest, I empathize with the networks, even though siding with a corporate copyright holder gives me the willies. Creating and broadcasting content is back-breakingly hard and terrifically expensive. Even some of those low-budget reality shows for third-rate cable channels that look like they were shot on iPhones… oftentimes they have budgets in the tens of thousands of dollars per  episode. And there are lots of working-class content creators behind those shows. Remember, most people in the entertainment industry aren’t millionaires; they’re regular people working paycheck to paycheck, relying on a steady stream of work from networks and studios to pay their bills. It’s easy to think of the producers and directors and say “who cares?” But the people who get hurt first and hardest are the below-the-line talent: the grips, boom operators, location managers, scouts, production assistants, etc. What will happen to those jobs if the networks believe that pouring money into original content is no longer a profitable business model? And if you’re one of the networks, do you want to continue operating in an industry where it’s permissible for competitors to poach your signal and rebroadcast your content without owing you a fee for your trouble?

I don't know what's going to happen, but in a corporate-friendly court like this one, I can see the Supreme Court buying an argument that Aereo’s continued existence will irreparably harm the bottom lines of not just the networks, but the big telecoms like Comcast and Time Warner (soon to be a single world-killing behemoth). I don’t want to see Aereo go down because the use of technology to better peoples' lives is an intrinsic part of the American ethos. But I also don’t want to see a wholesale dismantling of the entire entertainment industry (alarmist I know, but still possible).

I’ll update this post with some thoughts after Tuesday’s oral arguments. In the meantime, I’m going to stick with my cable hook up, and I’ll tell my friend to  start budgeting for cable again if Aereo goes down the poop chute.

What My Wife's Pregnancy And Derivative Works Have In Common

Three weeks ago, Steph and I decided to publicly announce that we're expecting our first child (September 1st, dear readers! Mark your calendars). It was crucial to us that the announcement be memorable and fun, and almost immediately, Steph hit upon the idea that the announcement take the form of a movie poster. I'm a film buff after all, so I think she knew I couldn't say no. My initial concept was to do a horror-themed one sheet in the vein of Saw, but Steph didn't like the idea of equating our bundle of joy with murderous psychopathy, so we quickly settled on another well-worn trope: the bright, colorful, goofy posters for terrible Matthew McConaughey romantic comedies like Failure to Launch, or How to Lose a Guy in 10 Days. The poster would feature us against a white backdrop, Steph as the beautiful, glowing mother-to-be, while I acted the part of the hapless but gold-hearted man-child.

Concept in hand, we hired a friend and professional photographer, Alex Jones, to shoot the poster. I wanted this thing to be perfect and my camera gear - an iPhone 5 - wasn't exactly going to cut it. I also knew Alex could deliver what I was looking for with minimal direction; he did my headshots last year and those were universally praised. As expected, Alex's poster shots went above and beyond. And after two days of experimenting with layouts, fonts, and colors, here's what we came up with:

The announcement was a big hit with friends and family and it was also a creatively satisfying experience. So why am I telling you this? First, I'm proud of the way the poster came out and I just want to brag a little. Second, I thought the poster was a good example of the weird world of "derivative works."

A derivative work is an adaptation, translation, or modification of an existing copyrighted work. You see them all the time without even realizing it. A film based on a book, a photograph of a sculpture, a cover of a song, an English translation of a Russian novel, a collage of cat meme pictures... all of these are derivative works. And with the internet providing unlimited free access to all sorts of visual content, it's become pretty easy to build a career as a derivative work artist. As a result, I frequently get questions from collage artists and photographers asking where the line is when it comes to using the works of others in their own work.

Unfortunately for them, that line is pretty clear; the only person allowed to make a derivative work of the original is the owner of the original! It's codified in our copyright law as an exclusive right, which means that if you author a derivative work without permission of the copyright owner, you could actually be liable for copyright infringement (exception: photographing or painting exterior structures like buildings and sculptures for commercial gain are generally not copyright infringement if the structures are easily visible from a public place). Without that permission, your only recourse is the fair use doctrine, which I've been pretty vocal about being a lousy way to get out from under a copyright infringement claim.

To complicate matters further, if you author a derivative work, you will own the copyright in the parts of the work that are unique to you, even if the derivative was unauthorized. The original copyright, of course, will still remain with the owner. This weird overlap can lead to some sticky situations with both parties claiming some copyright interest in the work and neither being able to profit off the other's creation.

So looking at our faux-movie poster, how does this dynamic play out?

1. The copyright to the original photograph rests with the artist. Contractually, Alex maintains the rights to all his photos unless he conveys them away. The only right I possess is the right of non-commercial display (meaning I can show people the photo but I can't resell it).
2. The modifications I made to turn the photo into a poster do not constitute copyright infringement in this case because I had permission from Alex - I hired him specifically to carry out a preexisting vision - and because I'm not making any money from it. If Alex had not given me permission (either explicitly or implicitly), I would have been liable to him for copyright infringement.
3. While Alex owns the copyright to the photo, I own a copyright interest in the overlay changes I made to transform his photo into a movie poster. Yes I can actually claim a copyright in the layout, the wording choices, the color choices, and the overall aesthetic effect of the piece.

You'll notice that a big reason I'm safe is because I'm not making money off the poster. That, obviously, is no consolation to a working artist who needs to make money to survive. So my blanket piece of advice for artists who rely on the works of others to create their own: do your best to get permission, use older work that's in the public domain, or avoid using preexisting work altogether. And if you're not interested in that, please talk to a lawyer to see if your intended use is protected by fair use.

Ultimately, I think your time is better spent creating new work rather than defending yourself on an infringement claim because you used old work.

[Author's Note: I don't actually know Judd Apatow and A.O. Scott.]

The Maker of Candy Crush Saga Is Trying To Crush Your Ability To Use The Word Candy: A Trademark Misadventure

Can you trademark a single everyday word? Even if you know nothing about trademarks, the answer seems obvious: NO. After all, if you can trademark a single word, what’s to stop you from trademarking “foot” or “bike” or “candy” and then suing someone every time they used that word in a business setting? Such a reality would be absurd. Sadly, such a reality may be upon us because King, the maker of the hit game Candy Crush Saga, has just received approval from the United States Patent and Trademark Office (USPTO) to do just that.

King is trying to protect Candy Crush Saga, its big moneymaker, from a host of imitators who use the word “candy” in their titles. So it did what any reasonably copyright holder would do to protect its financial interest… it submitted an application to trademark the word “candy” in order to prevent other game developers from using it. I’m not being sarcastic here either; King’s response IS reasonable because these imitators have confused the general public into thinking that these other Candy games were just like Candy Crush Saga, maybe even made by King. And with the public assuming all these games came from the same manufacturer, they became less likely to download the real deal and more likely to download the imitation, siphoning profit from King. This kind of marketplace confusion is exactly the type of problem that trademarks were designed to prevent.

The problem here isn’t that King tried to trademark a single word. The problem is that the USPTO let it. This is troubling for two reasons. First, the USPTO approving such an application violates a basic tenet of trademark law: that a trademark must stand out, it must be distinct. According to the USPTO’s own guidelines:

Generic words... are never registrable or enforceable against third parties. Because generic words are the common, everyday name for goods and services and everyone has the right to use such terms to refer to their goods and services, they are not protectable. 

In this case, the word “candy” is too generic; it doesn’t immediately reference a game for most people. It refers instead to a sweet food substance that a man my age shouldn't enjoy as much as I do. If, on the other hand, King had tried to trademark a unique version of the word like “Kan-D” the mark might have been stronger and more worthy of protection.

The second reason King’s application is so troubling is that it’s bad policy. If anyone can trademark any word, they can then clog up the federal court system (where trademark disputes must be litigated) with needless lawsuit after needless lawsuit. King clearly has no intention of legally pursuing every business that uses the word “candy". They simply want to prevent other game developers from making games that reference Candy Crush Saga. But you can’t base policy on the intention of one party. You have to base policy on the potential actions of everyone affected. Frankly, other trademark owners may not be as nice as King when it comes to protecting their trademarks.

Luckily, the trademark process is a long and complication one. Here, the USPTO has not officially registered the mark (which is the final step that grants the trademark owner a wide swath of protective powers). They merely approved King’s application, which means now that anyone who could be hurt by the mark has 30 days to contest the mark and try to persuade the USPTO why trademarking a single generic word is a bad idea. And believe me, there will be a lot of pushback on this, from immediately affected parties and policy wonks.

So what possessed the USPTO to approve King’s application in the first place? Was it negligence? Does it signal a strange new shift in policy? Is it a long-term gambit designed to draw attention to single-word trademark applicants and whip the public into a frenzy, thereby dissuading future like-minded applicants? Who can say? In my estimation, King’s registration will probably fail because of the pushback its application is going to get. But if the mark survives the contest period and officially registers, you can bet this won’t be the end of the story. King may well have just saved Candy Crush Saga from imitators, but it also just painted a huge target on its back.

When Rowling Met Galbraith: How An English Lawyer Broke The One Unbreakable Rule All Lawyers Must Follow

This past April, a former military police officer named Robert Galbraith released his debut novel, The Cuckoo's Calling to stellar reviews but terrible sales, selling only 1500 copies. As sales floundered, a British lawyer named Chris Gossage confided to his friend Judith Callegari that Galbraith wasn't a real person, but was in fact the pseudonym for J.K. Rowling, the most famous author in the world. Callegari then did what most of us would do when handed such a world-shattering piece of gossip - she blabbed to anyone who would listen, including a reporter. With the cat out of the bag, sales of Cuckoo skyrocketed to #1 on Amazon.

It's not hard to see why Rowling would do this. As wealthy and successful as Harry Potter made her, the pressure to rebel against typecasting must have been overwhelming. Following the release of Deathly Hallows in 2007, she sought to distance herself from the world of magic by writing a novel for an adult audience. The result was The Casual Vacancy, a thriller which sold like gangbusters, but was panned by critics. I imagine she took a great deal of satisfaction knowing that while Cuckoo wasn't popular when everyone thought Galbraith had written it (it's not like she needed the money), it found love from the very people who felt she could never write a book that wasn't aimed at children. She admitted as much on her website, saying that it was nice to be able to publish "without hype or expectation." So while Rowling was displeased with her identity being leaked, she had still proven her point.

Not everything worked out so well for Gossage though, a partner at the firm that represented Rowling. She sued the firm because he breached the inherent confidence present in the attorney-client relationship (which usually applies to the whole firm even if Gossage himself wasn't representing Rowling).  Even worse, he was just slapped with a fine by the Solicitor's Regulation Authority (the organization that oversees attorney ethics in England) for violating a client's trust.

Regardless of which side of the pond you live on, attorney client confidentiality is a pretty big deal. In most cases, by the time a client seeks the aid of a lawyer, a crisis has happened and the client is often in the midst of a deep personal anxiety. Not only are they emotionally fragile, they are dealing with issues that might require the divulging of sensitive information. Anything from sexual abuse, to financial indebtiture, to murder is on the table, and needs to be discussed frankly in an open and safe environment. If the client can't feel comfortable discussing these issues, then the lawyer can't give the best legal counsel he or she has sworn to provide.

That trust is so important that every country with a judicial system has a rule protecting attorney-client confidentiality. In Massachusetts, where I practice, Rule 1.6 of the Rules of Professional Conduct states that:

A lawyer shall not reveal confidential information relating to representation of a client unless the client consents after consultation.

Without the client's express consent, a lawyer can only reveal confidential information in certain limited circumstances:

1. If it would prevent someone from sustaining substantial bodily harm or death,
2. To obtain legal advice about ethics,
3. To defend himself against allegations of legal misconduct, or
4. To comply with another law or court order.

All 50 states have a rule like this. Depending on the severity of the violation, a lawyer can be punished with fines (as Gossage was), disbarment, or even jail time. Most lawyers take client confidentiality very seriously, not just out of fear of punishment by the local examining board, but because it's the right thing to do.

Every American law student knows the tale of Frank Armani and Francis Belge, two American lawyers who represented Robert Garrow, who was accused of murdering Philip Domblewski in 1973 while Domblewski was camping in the Adirondacks with friends. During a consultation with Armani and Belge, Garrow not only admitted to killing Domblewski, he admitted to murdering and raping several other people. Garrow told them where he dumped the bodies, and his story was confirmed when Armani and Belge personally went to those sites to investigate and photograph the remains.

But because Garrow was their client, Armani and Belge couldn't tell the family members of the deceased where the bodies were.  In fact, Armani and Belge kept silent for nearly a year, despite intense public pressure (they finally disclosed what Garrow had told them after Garrow admitted to the murders during trial). Because they had taken an oath to protect their clients' confidences (no matter how reprehensible), Armani and Belge were not able to discuss what Garrow told them without incurring potential legal repercussions.

In the grand scheme of things, the £1000 (about $1600) Gossage was fined amounts to little more than a slap on the wrist. Gossage claims that he himself is a victim of betrayed confidence, believing that Callegari would keep the secret. Regardless of his excuses, Gossage just learned a valuable lesson about talking out of school, especially when the client is as well-known as Rowling. He should count his lucky stars that she's a world-famous billionaire author, and not a psychotic rapist killer like Garrow.

Anyone Who Argues Against Net Neutrality Is A Greedy Scumbag Who Wants To Take Your Money

I've always wanted to write a salacious hit-bait headline like that. Hopefully it worked and you're reading this. So now that I've gotten your attention, here's what I really want to say... anyone who argues against net neutrality is a greedy scumbag who wants to take your money.

This week, the D.C. Circuit Court of Appeals struck down the Federal Communication Commission’s (FCC) rule protecting net neutrality. And that’s unfortunate because net neutrality is a wonderful thing. For those who don’t know, net neutrality is the principle that all internet traffic should receive free and equal service, regardless of source or content. For the past decade, this is how the internet has functioned. It didn't matter if you were reading an article on a news website, sharing your vacation pics on Picasa, or streaming Raging Bull on Netflix, you could access any content you wanted and it was all treated the same.

Net neutrality is what allowed Google, Facebook, Netflix, and Amazon to get a foothold in the marketplace and become the juggernauts they are today. Realizing the goldmine to be had by controlling access to the internet, the telecoms started implementing policies to do just that. So in 2010, the FCC passed an Open Internet Order allowing it to regulate internet companies the same way it regulates telecoms and cable companies. The goal was to keep access to the ENTIRE internet equal and open to all.

Why Should You Care?

Unfortunately, Verizon hated this, so it sued the FCC, claiming that its Open Internet Order was an overreach of federal power. The D.C. court agreed. That means it’s now legal for internet providers to:

• Block any website they want for any reason,
• Charge ISPs more money to host streaming content, meaning your Netflix subscription is about to increase by orders of magnitude,
• Cap and throttle internet usage with impunity, charging higher fees for better broadband access.

So if Time Warner wanted, it could now block any website it's not affiliated with. Prefer to get your news from NBC, Fox, or NPR? Too bad. Time Warner owns CNN so that’s the only news outlet you might be able to get. Even if it decides not to block those websites outright, it can charge ISPs higher fees to carry those websites, or throttle the bandwidth given to those websites making them load much slower. HuffingtonPost has a pretty solid rundown about how the internet might look in the absence of net neutrality.

Ultimately, the death of net neutrality will mean that a few giant companies can discriminate against sites and content they don't like and funnel your internet experience in ways they deem appropriate (during oral arguments, Verizon’s attorney admitted they would be pursuing different economic schemes if not for the Open Internet Order). With the internet providers controlling content, fewer and fewer startups will be able to get a foothold in the market, significantly affecting innovation.

Net neutrality opponents have argued that so much traffic comes from "big video sites such as Netflix and YouTube, [that it] clogs up the system and imposes delays on everyone else. These companies should be paying their fair share." Which sounds eminently reasonable until you realize that Verizon made $2.23 billion in the third quarter of 2013 alone, so it's not exactly hurting for cash.

Pro-neutrality advocates have argued that there's plenty of bandwidth to go around and charging extra because of the nature of the content is "naked corporate greed." I agree, and so do Facebook, Google, Yahoo, Amazon, and Netflix, who favor net neutrality and stand to lose a lot of money if the telecoms get their wish.

How This Affects Artists

The loss of net neutrality is bad for everyone, but it’s especially bad for artists because art is frequently visual in nature, and unlike text, visual media requires a lot of bandwidth. If I’m a filmmaker and I put my latest film on YouTube, how likely are you to watch if it takes 10 minutes to load because you’re on a lower-tiered broadband plan which doesn’t include video streaming? If I write a song that contains explicit sexual content, how will I get anyone to listen if Comcast starts arbitrarily banning content it deems to be pornographic in nature?

The end of net neutrality becomes another way for large corporations to trample the rights of individual artists, something I’ve railed about on this site for a while now. Limiting the artist’s ability to display and promote his or her work not only affects the individual’s ability to make a living, but it affects society at large because it stifles creativity and limits innovation.

Why There’s Still Hope

The Atlantic's Kevin Werbach offers some credible arguments that, despite the ruling, there’s some hope for the future. First, even though the D.C. court’s ruling now eliminate the only rule preserving net neutrality, no rules even existed before 2010. And it’s not like we were plunged into an internet-restricted hellscape during that time. In fact, immediately following the court’s ruling, Verizon announced that there would be no changes to its services for customers.

Second, the court made it’s decision on a fairly limited technicality and gave the FCC a roadmap for fixing this whole mess. In a nutshell, if the FCC placed internet services into the same category as it did the telecom giants, it would be able to reinstate the Open Internet Order in some form. The fact that internet providers are not classified as "common carriers" like the telecoms is the main reason the rule was invalidated by the court. And throughout the opinion, the court repeatedly references the FCC’s “choice” or “decision” to classify internet providers differently than telecoms.

Given the Commission’s still-binding decision to classify broadband providers not as providers of “telecommunications services” but instead as providers of “information services,” see supra at 9–10, such treatment would run afoul of section 153(51): “A telecommunications carrier shall be treated as a common carrier under this [Act] only to the extent that it is engaged in providing telecommunications services.”

Granted, reclassifying broadband providers as common carriers would require some legal jiu-jitsu by the FCC, and it’s unclear to me that the law would easily permit FCC Chairman Tom Wheeler to make that choice. Even if he could, he might not want to since it would probably result in a  political battle with congressional Republicans, who, it should be noted, absolutely hate net neutrality. Right now, the FCC is more likely to appeal the court’s ruling than reclassify. But reading the decision it became clear to me that the court was telling the FCC how to regain the upper hand. The decision repeatedly slaps down Verizon's claims and states explicitly that it “think[s] it quite reasonable to believe that Congress contemplated that the Commission would regulate [broadband internet service providers].”

Probably the best way to resolve the matter is to get Congress to pass pro-net neutrality legislation, which is obviously easier said than done. Luckily, there’s a lot of money in this fight and for once, it’s not a case of the big guys (i.e. big corporations) lobbying against the little guys (i.e. you). Sure, Verizon, Comcast, and Time Warner have a lot of money to lobby Congress. But you know who else has a lot of money to lobby Congress? Facebook. Google. Amazon. Yahoo. And they fucking love net neutrality.