When a page of history is worth a volume of logic–in the history of the UK’s Digital Economy Act, Google’s lobbyists did the same thing to the Brits that they tried to do to Americans (several times) in the form of a section to the Digital Economy Act (Section 43) that would have opened the doors to the rampant abuses that only Google could have afforded to litigate. Visual artsts are the ones who are most affected by these laws, and they founded a campaign in the UK called “Stop43“, a reference to the bizarre section of the Digital Economy Act that would have handed Google all the free content they could steal. Stop43 has a short recap of their history online that is well worth reading. Then be sure to read the anti-copyright organizational handbook Winning the Web (funded by the Open Society Institute), and tell me if you still don’t believe that there is an orchestrated campaign in major economies to undermine artist rights.
Stop43 has an excellent series of posts demonstrating that the UK government is not able to introduce laws that undermine the human rights of artists:
“The Human Rights Act 1998 restrains the Government from introducing legislation that is not compliant with human rights legislation, and indeed reading Section 6 it may be unlawful for civil servants even to draw up such legislation. When asked at a pre-consultation meeting on 23rd August 2011 attended by Stop43, among others, Matt Cope of the Intellectual Property Office confirmed that new UK legislation must be compliant with the Human Rights Act 1998.
It follows that any proposed legislation to enable the commercial use of orphan works or the extended collective licensing of copyright works, which is intended to result in a copyright holder in practice being ‘deprived of his possessions’ without his knowledge or consent (which Mr. Justice Arnold has judged to be the consequence for rightsholders of piracy of their copyright work) would breach Article 1 of the First Protocol of the Human Rights Act 1998.”
Notwithstanding the controversial report of the consultant to the UN Human Rights Council, Stop43 make an important point, and a point that American visual artists would do well to take note of in anticipation of the coming battle over orphan works–these laws violate the human rights of artists.
In the aftermath of the Google Books debacle, we are starting to hear noises that Google will back a new orphan works bill in this Congress. There are some commentators—truly misguided in my view—who are calling for Congress to bring back the failed legislation from 2008 known as the “Shawn Bentley Orphan Works Act”. (The late Shawn Bentley was a tech industry lobbyist and former Senate Judiciary staff counsel.) Let’s review that legislation in light of what we now know.
The net effect of the legislation is to allow anyone—anyone—to use a work—for any reason–for which the user could not locate the owner after a reasonably diligent search, and essentially stripped away any right of the copyright owner to stop the use. All answers for any problems that arose with administration seemed to be that the copyright owner could sue. Ask yourself if the copyright owner could not be located in a bona fide diligent search, how likely are they to sue?
The U.S. legislation was entirely out of step with successful orphan works practice in other countries, most significantly in Canada which has a very good orphan works regime that avoids the moral hazard of the U.S. system. We will discuss the very effective Canadian solution in another post.
The point is that the way the Shawn Bentley Orphan Works Act was drafted, it was designed to make it very easy for works to be used without compensating owners or even giving them a chance of finding the infringing use except by happenstance. This, of course, encourages parasitic innovation. Of course, if you described it that way to the sponsors, they would not agree, but there were thousands of artists who saw it exactly that way.
As you will see, Google was a prime advocate of the bill and planned on making “millions” of uses—so presumably, they also planned to make millions of dollars. In fact, orphanworks.com was registered on January 28, 2005 to Joseph Gratz. There is a Joseph Gratz who is counsel to Google in the Google Books case. These appear to be the same person. Google announced a deal with certain libraries on December 14, 2004 and were sued by the Authors Guild on September 20, 2005. It is a common practice for counsel to a client to “park” a domain of economic value to the client for a short period of time by registering the domain using their own name or the name of their law firm to avoid detection of their client’s interest in the domain. I don’t know if that practice violates the rules of the domain registrar, but it probably would be hard to prove that a domain was registered under false pretences.
orphanworks.net was registered to Joe Keeley, formerly counsel to the Copyright Office and the House IP subcommittee, on February 12, 2008 (weeks before the bills were introduced, but apparently after he left the people’s service). Keeley has a narrative regarding his role in the legislation on orphanworks.net which makes interesting reading.
Economic Effects on Small Business and Legal Effects of Treaty Partners
The Shawn Bentley Orphan Works Act (S 2913) was introduced in the Senate on April 24, 2008 and passed the Senate on September 26, 2008. Yes, that’s five months soup to nuts. The House bill (HR 5889, the Orphan Works Act of 2008) was introduced on April 24 and was referred to committee on May 7, 2008 where it died at the end of the 110th Congress. Therefore, the Senate bill also died.
Many artists will tell you it was a close call.
The principle difference between the two bills was the so-called “Dark Archive”, a registry of orphan works searches to be maintained by the Register of Copyright so that owners of the infringed work would be able to find the infringer. The Copyright Office objected to maintaining this archive and it was removed from the Senate bill (although other jurisdictions have a comparable arrangement that is, if anything, more robust than the House proposal).
Concerns of the Small Business Administration
During the course of the legislation, the Small Business Administration sponsored a roundtable in New York that was attended by dozens of representatives from entrepreneurs in the creative community: independent artists, songwriters, small music publishing companies, small independent record companies, photographers, illustrators, visual artists and many others.
While the roundtable attendees overwhelmingly rejected the Shawn Bentley Orphan Works Act, no one in the federal government conducted an economic impact study on this major overhaul to the Copyright Act, and the many businesses that are interdependent on them from bars and restaurants to CD duplicators, independent music stores, musical instrument manufacturers and hotels. As a threshold matter, there was short shrift given to the effects on U.S. treaty obligations to the point that treaty partners were ignored.
The closest thing to an economic impact study was the Congressional Budget Office report which stated:
“The bill would impose an intergovernmental and private-sector mandate by limiting the awards that certain copyright owners could receive in civil actions against infringers. The cost of the mandate would be the forgone value of awards and settlements of infringement claims. According to Copyright officials, there have been very few lawsuits against copyright infringers in recent years and the value of the awards in those suits have not been large.”
So that’s complete hogwash, unless they were referring to copyright litigation on the moons of Jupiter, and even then it seems improbable.
Why Perform an Economic Impact Study?
The rationale for performing a significant economic impact study is that the Shawn Bentley Orphan Works Act (and any other orphan works law) creates substantial harms for all copyright owners, but particularly small and independent copyright owners, including recording artists, songwriters, independent labels and others in the music economy. It should be pretty obvious that no one who was jamming the orphan works bill through the Congress wanted to know the answers or wanted anyone else to ask the questions.
“Orphan works” is clearly a land grab by big online companies like Google that went far beyond the debacle for small business wrought by the Digital Millennium Copyright Act. The DMCA made it nearly impossible for small business to enforce their rights online—orphan works legislation actually invades their rights and gives these rights to another unless the small business can afford to sue, probably against Google in many cases.
Cities such as Austin, Texas owe a substantial portion of their local economies to independent artists based on economic impact studies. Nashville, Tennessee is also dependent on songwriters and small publishers for its city identity and economy. No consideration whatsoever was given by the Congress to the economic impact of the Shawn Bentley Orphan Works Act on these cities, just to name two. Others that come to mind are New Orleans, Seattle, Chicago, Atlanta and San Francisco. What kind of artists are most likely to be overlooked in a search? The kind who lost everything in Katrina. The kind who never had a lawyer. The kind who perhaps naively rely on the law to protect their copyrights.
For reasons that escape me, the Congress was intent on establishing a legal regime by which big companies can take advantage of a small business’s failure to register works in a certain manner, allow those works to be exploited without restriction or manipulated beyond recognition, and then require the independent artist and small business to sue the infringing user (likely a Big Tech company such as Google) in order to gain recovery while at the same time denying the independent artist and small business the traditional award of legal fees.
When added to the debacle that the so-called “notice and takedown” provisions of the Digital Millennium Copyright Act have created for independent artists, the Shawn Bentley Orphan Works Act may well have been the coup de grace in creating two classes of copyright owners—those who can afford to protect their rights in court and those who cannot, the haves and the have nots, the Googles and the Ellen Seidlers.
The August edition of Music Tech Policy Monthly is out featuring the MTP interview with indie film makers Jason Stall and Topper McDaniel about indie film making in the age of piracy, a continuation of 20 Questions for New Artists, featured artist Slowtrain from Austin and the other regular features.
In more amazing hubris from Google, a company spokesperson announced that despite being tagged with one of the biggest, if not the biggest, civil fines in history for advertising the illegal sale of drugs online, the company will not be discussing the matter further given the extensive coverage of Google’s settlement with the Department of Justice to avoid jail time. I’m sure the Congress will be so pleased to be told by a defendant that they are not going to speak about the matter when Eric Schmidt finally shows up on September 21 to testify before Congress on Google’s wrongdoings.
What am I talking about you say? Well, don’t you know? Given the extensive coverage the case has received, why would you need to ask?
““This investigation is about the patently unsafe, unlawful, importation of prescription drugs by Canadian on-line pharmacies, with Google’s knowledge and assistance, into the United States, directly to U.S. consumers,” said U.S. Attorney Neronha. “It is about taking a significant step forward in limiting the ability of rogue on-line pharmacies from reaching U.S. consumers, by compelling Google to change its behavior. It is about holding Google responsible for its conduct by imposing a $500 million forfeiture, the kind of forfeiture that will not only get Google’s attention, but the attention of all those who contribute to America’s pill problem.””
“Search giant Google Inc. has agreed to pay $500 million to settle a Justice Department investigation into allegations that it improperly accepted ads from online Canadian pharmacies that import prescription drugs into the United States. [Read a copy of the plea agreement.]
Google agreed to forfeit $500 million it earned in ad revenue from the Canadian pharmacies, one of the largest ever forfeitures in the United States, the Justice Department announced in a statement.
The DOJ said that it is almost always illegal to import prescription drugs into the U.S., because the FDA cannot ensure the safety and effectiveness of the foreign drugs.
Google was aware as early as 2003, the DOJ said in the statement, that generally it was illegal for pharmacies to ship controlled and non-controlled prescription drugs into the U.S. ‘The Department of Justice will continue to hold accountable companies who in their bid for profits violate federal law and put at risk the health and safety of American consumers,’Deputy Attorney General James Cole said.”
Greed is Google
To paraphrase Gordon Gekko: “Greed is Google.” The upshot of this whole thing is that Google decided that they would rather risk the harm to consumers–all consumers, including kids–and make a fast buck from advertisements for counterfeit drugs and illegally prescribed drugs. The enormity of their violation and the vileness of the behavior is rather hard to comprehend. What does it cost to keep Eric Schmidt out of jail? $500 million of the shareholders money.
Is he worth it? Does anyone know if “users” died while benefiting from Google’s ”pill problem”?
Missing from the Settlement: Wrongful Death
Here’s the problem in a nutshell (from the Washington Post in 2003): “In July 2001, regulators at the Nevada State Board of Pharmacy noticed something unusual among the reams of data that flow into the busy agency each day. Buried along with the other numbers was a report from a small Internet pharmacy that had filled 1,105 prescriptions for painkillers and other dangerous drugs that month.
The same tiny pharmacy had dispensed just 17 prescriptions in the prior six months.
Virtually overnight, prescriptiononline.com had become one of the largest distributors of controlled substances in Nevada. Over the next year, the online pharmacy shipped nearly 5 million doses of highly addictive drugs to customers scattered across the country. By the time regulators shut the Las Vegas firm in January, prescriptiononline.com accounted for 10 percent of all hydrocodone sold in Nevada, regulators said.”
This is exactly the kind of human misery that Google profited from and for which it is being punished.
Google Employees Caught in Sting Operation Creating Ad Campaign for Illegal Drugs
According to the Associated Press, “A separate U.S. Food and Drug Administration investigation into drugs that claimed to be manufactured in Canada found that 85 percent of the drugs examined came from 27 different countries, including some that were found to be counterfeit, said Kathleen Martin-Weis, acting director of the FDA’s Office of Criminal Investigations.
Investigators noted that Google did not allow online pharmacies from any other country aside from Canada to advertise to American consumers. [A sophisticated level of filtering by ad type, country of origin and country of destination--but they can't stop infringments.]
The probe did not touch the overseas online pharmacies, Neronha said, because American officials did not have the authority to bring charges. .
Investigators snared Google’s ad system by creating seven undercover websites offering prescription drugs to be sold without a prescription or the completion of an online medical questionnaire, Martin-Weis said. An undercover investigator informed Google employees creating the advertising for the products that they were manufactured overseas and did not require that customers have a valid prescription, she said.
“In each instance, despite this knowledge, Google employees created a full advertising campaign for each of the undercover websites,” Martin-Weis said.”
It will also sound familiar to Senator Diane Feinstein who authored the Ryan Haight Bill which became the Internet Pharmacy Consumer Protection Act–that would be Senator Diane Feinstein of the Senate Judiciary Committee that unanimously passed both COICA and the Protect IP Act.
Google clearly profited from exactly the kind of behavior that the Ryan Haight Bill was designed to prevent. But the unanswered question is what role Google played in the addiction and death of other kids like Ryan Haight? The company says they are shutting up about their role in promoting these tragedies–for good reason.
The wrongful death suits or state law manslaughter charges against Google and its employees may well be next.
It’s amazing what you can find out with a wire tap.
“Do no evil” vs. “Don’t be evil”
Google’s fascination with its own moral superiority is worthy of an evangelical conducting baptisms by the riverside complete with snakes while speaking in tounges. Tounges that are decidedly forked–Google passed moral relevancy long ago, it’s now full throated moral obliviousness. This except from a Business Insider article is an excellent demonstration (an article from 8/22/11 that says nothing about Google’s “pill problem”, by the way):
“But as computer researcher and social activist Aaron Swartz points out, Google had a very specific definition of evil. [Aaron Swartz is a Lessig ethics student who was recently indicted for breaking into MIT and downloading all of the JSTOR articles although that fact is never mentioned in this article.]
[Google's definition of evil] had nothing to do with market tactics like stabbing former partners in the back or playing hardball with weaker competitors.
It was all about users.
Google gave…examples: it would only show relevant ads [very relevant drug ads for addicts], would never show pop-ups or other annoying “tricky” ads, and would never sell search results.
In other words, it would never make a product worse for users just to make a quick buck [that's right, Google just took its vig on the dope].
So look back at Google’s actions from the last year and they’re mostly in line with this credo… to make [Google] better for users.[Helping addicts find cheap dope and get around controlled substances laws passed by the people to protect addicts]
Sometimes the line gets blurry, particularly with acquisitions — buying travel information provider ITA looked a lot like Google was trying to own a supplier of critical data to a competitor, Microsoft’s Bing [or promoting the sale of illegal drugs]. (Did Google really need to OWN it to provide better travel search results?)
But if avoiding evil means pleasing customers, that’s just smart business.
And that’s why Google is winning.”
Well…if ”users” means drugs users and if “winning” for the stockholders means the management team buying their way out of prison for $500 million. And I think that the American Gangster drug dealer Frank Lucas would heartily agree–his Blue Magic heroin gave customers twice the high for half the price. The means justify the ends.
By Google’s standards, neither Eric Schmidt nor Frank Lucas did evil in selling drugs because “users” were better off. Both profited from human misery. Which leaves the same question that has been asked every time Google gets caught doing increasingly vile acts:
Where is the board?
PS
In a curious twist of fate, another major Creative Commons contributor also paid a whopping $300 million fine to the Department of Justice. Glad to see that the friends of Lessig are doing their part to retire the National Debt.
Don Henley’s opinion piece in USA Today (“Internet Theft is a Job Killer, Too”) lays out the problems that Google has with Protect IP–they make way too much money off of advertising for illegal drugs, products, music, games and film. Since for every action there’s a reaction, the income transfer to Google also results in a loss of jobs for American workers. Henley makes the case that Google’s profit from misery extends to selling advertising for illegal drugs, especially prescription drugs that are sold with illegal prescriptions to under age kids. As Lessig would say, they need to stop criminalizing our kids.
Update: According to the New York Times, Google has as of 8/24/11 agreed to pay a $500 million fine to the U.S. Government to avoid a criminal prosecution for the sale of advertising promoting the sale of illegal drugs and illegal prescriptions. (Read the plea agreement.) More to come on this, but it looks like Google could have stopped taking any advertising from rogue drug sites, but chose not to–because it didn’t scale. No word yet on how many deaths are attributed to Google’s advertisers.
Google’s drug business alone has attracted a $500 million fine and an investigation from the U.S. Department of Justice, well documented by Dr. Sanjay Gupta on CNN’s broadcast–all of which could have been avoided if Eric Schmidt had not simply ignored an entreaty from Joseph Califano to work together with him to stop the sale of illegal drugs that was killing American children.
How could Schmidt have possibly ignored a letter from a former cabinet secretary to two Presidents (of the United States)? We polled a couple of digital natives and got a plausible explanation: (a) it was a letter sent by snail mail and not email, (b) Califano is so old, and (c) why didn’t he send a text message if it was so important! Ah, yes, communicating with Google is all about the toys.
Read the inspiring Don Henley editorial and think about what you would say to your local paper.
Interesting reading–the objectors to the class action settlement in the freelance authors case have prevailed in the 2nd Circuit. The issues in “Freelance” were nearly identical to those in the Google Books settlement–not surprisingly involving the same lawyers for the authors so once the artifice in one is shot down it is shot down for both.
This may have been the nail in the coffin for Google Books. Not that it matters. Scanning, scanning, scanning continues. The whole litigation was a bright and shiny object if you ask me. Designed to deflect attention from the criminal levels of copyright infringement by Google. (In the books case, not to take anything away from the criminal levels of infringement in other cases.)
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