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The Next Great Copyright Act? A View from Washington

Copyright Act

Chris Reed is a former senior policy advisor to the Register of Copyrights and author of Copyright Workflow for Photographers.

If you’re a regular reader of the Art Law Journal, you’re likely well aware that copyright law provides certain exclusive rights to authors of creative works for a certain period of time. You’re probably also aware that artists and other creators haven’t been doing so well under copyright law in recent years. A rapidly evolving technology landscape coupled with an outdated legal regime has led to almost a “wild west” sort of mentality on the Internet, with some people stealing content with impunity, and a string of unfortunate court cases that have systematically weakened some of the exclusive rights of copyright owners.

The fundamental issue is that our current copyright law is old. It was drafted in an era when the creation (and infringement) of copyrightable works required a significant capital investment — printing plants, recording studios and the like – and the average consumers’ interaction with content did not require exploiting any of copyright law’s exclusive rights. Today, anyone can be a copyright infringer at the push of a button. As any photographer whose work is online knows, a simple right-click-save-as is all that’s required to make a copy of a photograph, and it’s a relatively simple matter to re-upload that content almost anywhere: an email, a social media post, or even another web site. Put simply, technology has outpaced the law.

Although our current copyright law, the Copyright Act of 1976, went into effect on January 1, 1978 discussions and negotiations for that law actually began much earlier, in the 50s and 60s, which means that our “current” copyright law was largely conceived around half a century ago. Congress has tinkered with the law occasionally since then, most notably in 1998 when it passed the Digital Millennium Copyright Act which was intended to update the law for the digital age. But even those provisions are now more than fifteen years old, which in Internet years, is an eternity.

Recognizing the challenges facing the copyright system, the Register of Copyrights, the United States’ top copyright official, Maria A. Pallante, delivered an address in March 2013 entitled The Next Great Copyright Act, in which she called upon Congress to consider updating the law for the twenty-first century. Congress listened, inviting Pallante to testify before Congress to expand on some of the ideas presented during her speech. The next month, Bob Goodlatte, chairman of the House Judiciary Committee, the committee that oversees intellectual property law, announced on World Intellectual Property Day that the Committee would undertake a “comprehensive review” of the copyright law. He stopped short of calling for legislative change, but observed that “a wide review of our nation’s copyright laws and related enforcement mechanisms is timely.”

Since Goodlatte’s announcement, Congress has held more than a dozen hearings on copyright related matters, with witnesses from all parts of the copyright ecosystem, ranging from independent creators (including photographers), publishers, record companies, film and TV studios, Internet companies, software developers, and consumer-interest groups. In addition, the U.S. Copyright Office, which serves among other things, as the principal advisor to Congress on copyright-related issues, has issued a number of studies and reports on copyright issues, and will be releasing several more in the coming months.

But what does all this mean for creators? The political reality is that most stakeholders don’t want a whole new copyright act, but Congress and the Copyright Office have taken an interest in a handful of key areas that might end up becoming the subject of a legislative proposal. Here’s a quick summary of some of those issues that might most directly benefit independent creators, including visual artists:

“Small” Claims Issues

Perhaps one of the greatest challenges for independent copyright owners is the lack of adequate enforcement tools. According to a study cited by the Copyright Office, the average cost to bring a copyright infringement suit is $350,000, which, as the Office noted in its own recent study, is “not only completely disproportionate to what most individuals could invest in a lawsuit, but also to what a copyright claimant could ever hope to recover in a relatively modest infringement case.” In short, most individual copyright owners are priced out of court, and without an effective mechanism of enforcement, copyright’s exclusive rights are more or less meaningless.

To alleviate some of these concerns, the Copyright Office has proposed to establish a small claims tribunal, administered by special judges that work within the Office that would hear certain infringement cases of relatively low value. To comply with constitutional requirements, the procedure would have to be voluntary, and under the Office’s proposal liability would be capped at $30,000, but it would also be much cheaper than traditional litigation, since all of the proceedings would take place on paper or via telephone as opposed to in-person hearings.

Unfortunately the Copyright Office can’t act alone on this. The establishment of such a tribunal would require Congress to create the statutory framework and give the Office the authority it needs to adjudicate such cases. But, because this is a relatively noncontroversial proposal with support from a number of major stakeholder groups, there is a possibility that Congress may fold this in to whatever it tries to do legislatively.

Artist Resale Royalties

The longstanding copyright doctrine of “first sale” provides that there is a distinction between the physical embodiment of a copyrighted work, and the work itself. In short, copyright owners have no right to control the downstream use of the physical embodiment even though they control the underlying copyright interest. That’s why it’s legal to re-sell a book or a DVD containing copyrighted content even though it’s illegal to copy the literary work in the book, or the motion picture on the DVD. Unfortunately, it’s also the reason why an art collector can purchase a work from a relatively unknown artist for a few hundred dollars, and then later sell the piece for tens of thousands of dollars, without the artist seeing any of the proceeds. The artist has no right to the downstream use of the physical object.

In many foreign jurisdictions the first sale concept has been modified somewhat to allow visual artists who make their living off of selling original works of visual art. Under these so-called droit de suite regimes, artists have an ongoing right to obtain a percentage of the purchase price every time their work is sold (in the U.S. we call it a “resale royalty”). Although we don’t have a system like that here, the Copyright Office recently released a report in which it suggested that a resale royalty regime might be a good way to resolve the inequity between visual artists, who typically sell original copies, and other copyright owners, who typically license reproductions and are able to recoup their up-front creative investment through ongoing licensing revenues as opposed to one-off sales.

The resale royalty issue has seen some legislative action as of late. Senator Tammy Baldwin and Congressman Jerry Nadler of New York recently introduced the American Royalties Too Act of 2014 which would establish a resale royalty regime in the United States. As the 113th Congress draws to a close, it’s unlikely we’ll see any action on these bills, but it’s quite likely that lawmakers will try again in the 114th, perhaps as part of a larger, more comprehensive bill on copyright issues.

Orphan works

A perennial thorn in the side of many visual artists is the ongoing debate about orphan works – works that are protected by copyright but for which the copyright owner cannot be identified or located. The so-called orphan works “problem” is that people who want to make productive uses of those works can’t because they don’t know who to contact. In 2006 the Senate passed a measure that called for a limitation on damage awards against such users provided that certain steps were taken before they made any use of the copyrighted work. Many photographers were understandably upset because of the various categories of copyrightable works, photographs are far more likely to become orphaned than other works because they generally don’t contain any copyright ownership information on the image itself (as opposed to books, movies, and music products, which usually contain copyright statements). The 2006 bill never made it through the House, and the orphan works problem remains unsolved.

The major proponents of orphan works legislation – mostly the library and Internet community – have largely quieted down owing to a series of court decisions that have greatly expanded the application of “fair use.” While many copyright lawyers disagree with the rulings, it has caused the proponents of orphan works legislation to back off, thinking they can get broader protection from the court than they will through legislation. They might be right. Still, the Copyright Office is currently putting the finishing touches on an orphan works proposal that will very likely call for legislation. Since the Copyright Office was so involved with the 2006 bill, it’s very likely that the new proposal will look similar. One wildcard is how the Office decided to handle a new development: the rise of mass digitization projects, such as Google Books, which didn’t really exist when the prior bill was introduced. The other wildcard, of course, is whether Congress takes up the Copyright Office on its proposal.

Improvements to the Copyright Registration System

In addition to all the other issues facing the copyright system, the Copyright Office has also been looking in the mirror a lot lately. Stakeholders – particularly photographers – have been complaining about the state of its online registration system almost since the day it was launched, and the Copyright Office is well aware of the concerns. In a recent request for public comment, the Office recognized that “[a]lthough the current system, and the periodic upgrades and enhancements, have allowed the Office to maintain a functional electronic platform for many types of works, there is room for substantial improvement.”

Whether that improvement will take place and what that improvement will ultimately look like remains to be seen, but many stakeholders have been clamoring for some sort of open framework with an API that would allow third-party developers to interface with the Copyright Office systems, and build their own tools to register new works or look up information about previous works. Relatedly, such a framework would allow operators of private databases, such as PLUS, to interface with Copyright Office records, creating more robust registries.

One of the biggest impediments to such a system is the Office’s structure and funding. The Copyright Office is part of the Library of Congress and as such, it’s subject to oversight and supervision by the Librarian of Congress. As a result, it doesn’t often get the money or staff support that it needs to effectively serve copyright owners, and more to the point, its information technology platform is intertwined with that of the greater Library of Congress, which often has vastly divergent goals and a very different underlying mission. There is, therefore some question of whether the current administrative structure of the Office and the Library is the right one on which to build a new registration system; some have been calling for an evaluation of whether it’s time to remove the Copyright Office from the Library. Congress began exploring these issues at a recent oversight hearing, and appears poised to continue to discuss Copyright Office modernization issues sometime during the next Congress set to begin in January 2015.

 _______________

There are literally dozens of copyright issues that Congress and the Copyright Office have been considering since the Register’s call for updates to U.S. copyright law in early 2013. What will ultimately develop in the legislative sphere remains unclear; what is clear is that Congress has been more interested in copyright issues during its current session than it has since it passed the current Copyright Act in 1976, and all signs are that will continue well into the new year, leaving us with plenty to watch in 2015.

About the author

Chris Reed

Chris Reed is a Los Angeles-based photographer and lawyer. He practices copyright law in the  media and entertainment industries and is the author of Copyright Workflow for Photographers: Protecting, Managing, and Sharing Digital Images from Peachpit Press.

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  • I hope those approaching solutions to these problems also consider all the copyright infringements that are now happening in China, South Korea, India, etc.
    13-plus states in the US now have laws requiring Certificates of Authenticity on the sale of certain type of art prints if the prints are signed or over a limited value.
    Some of these various laws may be good models for a national law regarding prints with a signature or limited editions. I doubt we will ever see International agreement on some of these issues, but in the US the onus for compliance could be placed upon the US importers and the US merchants
    involved in these transactions.

  • Chris Hi
    I am an Australian.
    My understanding is that Mr Nadlers proposed Art resale royalty Act did not get , in congress, the bipartisan support it would have needed to have any real chance of success . And that the US copyright office in its testimony to the committee was quite “lukewarm” re a legislated resale royalty scheme. And I gather that unless there is some sort of action before the end of the year the current bill will lapse.
    Do you think there is much real chance of anything really happening in the next term (or two) of congress?

    • Hi John,

      Thanks for reading the article and for your question. You are correct that the current bill will lapse if Congress doesn’t act on it by the end of the year, and it doesn’t look as though they’ll do that as there are just too many other pressing issues for Congress to take up between now and the end of the session. I should note that I wouldn’t say Mr. Nadler’s bill failed to garner bipartisan support, rather, out of deference to the Chairman, who is contemplating a bigger package of copyright legislation in the near future, there just isn’t much interest in doing piecemeal legislation on specific issues until Congress has had time to fully think through all of the major copyright issues.

      Does the resale royalty issue have a chance to make it in? Maybe. It’s too early to tell what will end up in a legislative proposal if there is one. Resale royalties has some strong support, but not as strong as other issues, such as music licensing, which appears to be one of the issues that Congress wants to spend some time on.

      So the quick answer to your question: there’s a good chance that something will happen on copyright in the next term or two; whether it includes resale royalties remains very unclear.

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