Ownership in the digital world

Friday, Oct 9, 2009 1:07 pm
William Barnes

My latest IP Osgoode post is up. In it I discuss the difference between what consumers expect when they buy digital content or a network connected device and reality. This post expands and clarifies that article.

Most people, I believe, think of all their physical possessions similarly. There is no difference between a couch and a novel as far as ownership goes. The incidents of ownership are the same: you possess the object; nobody can take it from you without permission; you can dispose of it as you please. There is, however, one significant difference between the two: the novel is a copy of a work in which the author retains rights. But physics isolates the consumer from this fact. They have a single copy and will probably never have more than a single copy. If they sell that copy, then they lose it at the very instant another person gains it. As long as the consumer treats the book as an ordinary possession, they will never have to think about IP rights. For most practical purposes, therefore, all physical possessions can be treated the same.

With digital content, however, all this changes. Rather than being given a physical object, consumers are granted a license to use the work in certain ways. This license will, at the very least, allow the consumer to possess and access copies of the work for personal enjoyment. Note that I said copies in plural. With a physical object, the owner has a single copy. The fact that they own a copy of Cryptonomicon (great book) does not give them the right to possess just any copy; it has to be that specific one. With digital content, however, you can have as many copies of the work as you want. In fact, if you buy a song from iTunes you will be told that it is your responsibility to make copies. And it shouldn’t matter where your copy comes from. If Alice and Bob both buy a song from iTunes and Bob’s hard drive crashes, then Bob should be able to just obtain a copy from Alice (at least in theory). In a real life example, if a user deletes a book from an Amazon Kindle (or lose the device), Amazon will let them download a new copy for free. This doesn’t happen with hardcover books; Bob can’t photocopy Alice’s copy of Cryptonomicon and Chapters won’t give him a new copy for less than the cover price.

In this fashion, licensing sounds pretty good. But it can give rise to strange circumstances that dealing in the physical world would not lead one to expect. Last month, Amazon remotely deleted two books from Kindle e-book readers when they learned that they did not have the right to sell the book. It sounds weird but consumers who purchased the book from Amazon didn’t purchase anything and Amazon did not take anything from them when they deleted the book; Amazon can’t give what they don’t have. Nobody would expect an employee from Chapters to come to their house and take back a hardcover book if it turned out to be counterfeit. There’s the practical difficulties, of course, but there’s also a physical item which the consumer owns. The consumer would be well within their rights to refuse to hand it over. In the case of an e-book, however, there is no interest in anything other than the license. The consumer may have other causes to complain, but they cannot claim that they had any right to keep their copy of the e-book.

The Amazon issue leads us away from ownership of digital content and into a related (and even more problematic) issue: ownership of network-connected devices. Unlike an MP3 or an e-book, the Kindle is an actual physical thing. Traditionally, consumers don’t expect manufacturers to interfere with their physical possessions after sale. Connected devices, however, routinely phone home for updates and content. This is very valuable behaviour but it isn’t always used to enhance the device. It can be used, for example, to remove the ability to skip commercials from a PVR; to block websites on a smartphone; or delete books from a Kindle. What this means is that, for better or for worse, the device someone buys is not in their own control. Why would a company want to downgrade a device? I think the best reason is to avoid liability. They have sold a device (or, in Amazon’s case, content) that has a defect of some kind and don’t want to be sued. The problem with this is that it shifts the burden of the company’s mistakes onto its customers. Amazon could have refused to delete the books but they would have been sued. Instead, they saved themselves by depriving others—although they did refund the purchase price.

That said, I don’t think that forbidding such practices is the way to go. It could very easily end up banning a lot that is useful about network-connected devices. I also think that over time an etiquette will develop over when such action is permissible and what compensation is required. Partially this will be regulatory, but the market will help define what people are willing to put up with. And I actually think that in Amazon’s case, it is defensible. If Alice sells Bob a stolen car, Bob can’t reasonably expect to keep it. Likewise with the example I used in my article of a defective reclining chair. It’s better to lose a function than a leg. Maybe companies should have to offer to buy back devices that they downgrade or offer a reasonable monetary payment.

I don’t think that we should try to force new forms of property into awkward physical molds (the music industry tried that with DRM and look where it got them). A balance has to be struck between the surety of the old ways and the flexibility of the new.

Annoying Domain Dispute

Sunday, Aug 2, 2009 4:10 pm
William Barnes

I really don’t like the outcome of this (old) case: Freddy Adu v. Frank Fushille. The complainant is some kind of soccer player or something. The respondent is a fan. The respondent registered a domain with the intent of starting a fan site. At some point, he contacted the soccer player’s manager and said he was making a fan site and was wondering if it could be the official site (presumably, the soccer player didn’t have an official site at that time). The manager sent back an offer to buy the domain. The guy didn’t want to just sell the domain though, he wanted to run the site. So they got into a discussion over that. Apparently, the respondent got carried away during negotiations and they fell through. The manager then files to have the domain transferred, using the negotiations as evidence of bad faith registration.

That’s just wrong.

Everybody has a price. If I were running an unofficial fansite for a celebrity and the celebrity offered me a million dollars for the domain I would probably take it. The celebrity should not be able to then turn around and say: ‘Aha! Bad faith!’. Negotiations initiated by the complainant shouldn’t be evidence of registration for the purpose of sale.

The Commons

Friday, Jul 17, 2009 7:51 am
William Barnes

I just wanted to add something to my recent post on copyright on 200 year old paintings. The reasoning behind copyright is that giving a time-limited monopoly encourages people to create new things. And why do we care that people create things? Because after the time limit is up those creations enter the commons and become the property of everybody (and I ignore the contentiousness of that phrase). People understand the monopoly bit, but rarely the commons bit.

What bothers me is that museums are given works of art for safekeeping. They control access to the physical items and (in the interests of preventing damage perhaps) restrict the ability of people to take copies (flash photographs, for example). Eventually, these items are supposed to pass into the commons. But what good is a work in the commons if nobody can get a copy of it?

It’s really difficult to work out what’s right and wrong here in any general way. I don’t think we want to impose a duty to provide the public with copies of work in the commons. And I’m not sure we want to take away economic incentives to reproduce such works. It can be very expensive to restore and reproduce art. Maybe laws need to be made that address the reproduction of privately held commons works. Then again, the practical difficulties of providing copyright protection to copies of commons materials could be prohibitive. Eventually, those digital copies will themselves enter the commons. Does the first person to copy them at that point receive a copyright interest? And how do we manage the fact that dozens of people may own copyright in what is essentially the same thing?

In the case of museums it’s simpler than with private owners. Museums exist for the purpose of protecting and sharing cultural knowledge. They receive public funding, tax benefits, and physical possession of the works based on this. They should not be removing works from the commons. I’m not saying the museums are evil. They are, of course, constrained by financial considerations. They are underfunded and need to take advantage of everything they have. I’m just saying that something is wrong and needs to be fixed.

Domain Name Dispute Resolution

Wednesday, Jul 8, 2009 12:00 pm
William Barnes

My latest IPilogue article What Jay Leno taught me about domain disputes should be up by now. It presented an interesting problem. Topics at IPilogue are assigned by email a few days in advance. We generally just get a link to a news article. But while the article I got on Jay Leno made it sound like a big deal, the case was actually the equivalent of a zoning dispute. There was nothing in it that hadn’t been said a thousand times before (the case was actually copy-and-pasted from an earlier case by the same panelist). Like I said, this presented me with a problem. I didn’t have time to get in touch with the editors and I didn’t have anything compelling to write about.

I solved (I think) this problem by noticing that everything had been said a thousand times before and yet I had never heard it before. There are five types of articles on domain dispute resolution: (1) celebrity gains control of HisOrHerName.com, (2) evil corporation steals Pokey.org from 12 year old kid, (3) case demonstrates that dispute resolution doesn’t work, (4) technological or social change means end to dispute resolution, (5) jokers keep control of obviously infringing website with wacky donkey argument. I did a lot of research for this article and this list is exhaustive. So I figured I could sneak in a little article on the criteria governing the process and though it might not be compelling, it might be useful.

I left out of the article a scenario that seems plausible to me but I cannot find any evidence of having occurred. What if a person registered a famous trademark and used it for a personal website? Let’s say, for a more concrete example, I registered CocaCola.com and put my blog up there. I’m not competing with Coke, but I’m getting some traffic that is meant for them. I am not sure what way that would go. There is an exception for valid commercial uses and where the domain is a nickname. But what if I just wanted to steal Coke’s traffic for my non-commercial site and had no other reason to use that domain?

Also, while writing this I got to think about an idea I had a while back (I think I posted it on IPilogue someplace). Someone should start a username registry:

  1. Trademark owners and celebrities register their desired usernames
  2. New social networks and websites reserve those names
  3. One in a thousand social networks becomes worth joining
  4. Trademark owners pay to the network a price based on size or some other metric for the reserved name

That way, when the next Twitter comes along, CNN can be sure that newtwitter.com/CNN is available. They’ll have to pay for the privilege, but they won’t be penalized for not being early adopters. It also means a little free money for the social network.

Cybercrime

Wednesday, May 13, 2009 9:18 am
William Barnes

The word is starting to grow on me. I used to really dislike it. It sounded like something out of a Saturday morning cartoon. Mostly it (along with “cyberspace”) just encourages people to talk about the Internet as if it were a place. The Internet isn’t a place, it’s a bunch of computers and wires that talk to each other. The whole “cyberspace” metaphor is useful for quickly explaining something, but it doesn’t really represent what is going on in your computer.

My first IPilogue article was just published: What is Cybercrime? It’s mainly a comment on another article on the same subject which basically defines cybercrimes as crimes taking place in cyberspace and then concludes that none exist: all cybercrimes are just regular crimes adapted to work in cyberspace. The author does, in a later article, express a little embarrassment at the term but she does not acknowledge its unsuitability. I say rather that cybercrimes are just unique computer crimes. They’re crimes that weren’t possible without computers but they don’t require us to invent some kind of allegory to make them fit into our existing system of criminal laws.

The Ordinary Crowd

Saturday, Mar 14, 2009 2:08 pm
William Barnes

As I’m sure you’re aware, in Mustapha v. Culligan of Canada the plaintiff had a mental breakdown after seeing a fly in bottle of water he had purchased from the defendant. The Supreme Court of Canada overturned a $341,000 judgement in favour of the plaintiff because the damage suffered by Mr. Mustapha was too remote. [Law students, particularly 1Ls, may want to just skip to the next paragraph] Liability for negligence requires that three things be proved: (1) the defendant breached the standard of care, (2) the defendant owed a duty to the particular plaintiff, (3) the injuries of the plaintiff were caused by the defendant’s negligent act. The SCC dealt with the first two issues quickly and moved onto causation. Remoteness provides a limit on causation in law; the defendant is only liable if the type of damage suffered was reasonably foreseeable. Even though the fly in the bottle did cause Mr. Mustapha’s breakdown, it was not “reasonably foreseeable that a person of ordinary fortitude would have suffered personal injury” and the defendant was not held liable for it in law.

The issue I have in mind is the use of the “ordinary person” in this case. The use of the ordinary person makes sense in one-on-one interaction. If I interact with a single person out of 800,000 in this city, the odds of that person being ordinary are quite high. If, however, you are in business and dealing with thousands of the 800,000 people in the city, the odds of running into more eccentric people go up—and if you’re in the bottled water business, the odds are probably even higher (cf. Mr. Monk Goes to Mexico). It would be almost an absolute certainty that one of Culligan’s customers would be a germaphobe likely to suffer extreme mental distress if they got a bottle of water with a fly (or other foreign object).

The ordinary crowd contains a certain percentage of germaphobes, people with nut allergies, vegetarians, and people keeping Kosher or Halal. Yet, the ordinary person is likely none of these. The bigger the group you interact with, the less valid the assumption of the ordinary person becomes. The ordinary person does not have a peanut allergy, but a company that negligently let peanuts get into a normally peanut-free chocolate bar would likely be held liable if it were eaten by someone who did. Perhaps the court might have determined that the extreme germaphobe is so rare that he simply is not foreseeable, but if the extreme germaphobe is merely uncommon then they ought to have foreseen the possibility of harm to someone.

Unilateral & Bilateral Contracts

Thursday, Jan 29, 2009 11:05 pm
William Barnes

I think people enjoy naming things. That’s why we create distinctions even when they don’t seem to serve a practical purpose; it gives us more things to name. Unilateral and bilateral contracts, for example.

But first, an extremely short bit on offer and acceptance. Pretty straightforward: someone makes an offer—that is they signal somehow that they would agree to some set of terms–and then somebody else accepts the offer–by signalling that they also agree to those same terms.

A bilateral contract is one in which these terms set out obligations for both parties. The parties agree and then each carries out his own side. In a unilateral contract, only one party has obligations. Now, we know—or, at least, as far as I know—you can’t make a one-sided contract. Both parties are supposed to get something. So such a contract is formed where the act of acceptance and the fulfilment of one party’s notional duties under the contract are the same act. The example Professor Benson seems to enjoy is this: A says to B “I will give you $10 if you mow my lawn.” B, in this case, would accept by mowing the lawn. At that point, A would be contractually obligated to pay B even though B was never contractually obligated to anything.

It seems to me that any offer that could give rise to a unilateral contract could quite easily be accepted and a bilateral contract created. Imagine that B had replied: “OK, I will mow your lawn for $10.” Would that not create a contract such that A could expect the mowing and B the $10? The important thing to take from this is that the phrases unilateral and bilateral contract have no meaning until the contract exists. The most you can say is that some contracts allow a method of acceptance that simultaneously fulfils the second party’s obligations. But what, from the post-contract perspective, is the difference between a unilateral contract and a bilateral contract in which one party fulfils their side first?

We haven’t covered consideration but the hints we have received about it give me hope that I will be able to further explain my discomfort once we do.

Ultra Vires

Thursday, Nov 27, 2008 7:36 pm
William Barnes

There has recently been some controversy regarding the Faculty of Law student paper Ultra Vires. The University of Toronto Law Union has taken issue with Ultra Vires’ practice of granting honorariums to volunteers at the end of the year. Having read the paper’s account, received a mass-email from the Law Union, had an interesting discussion with some classmates, and, finally, having not written anything on here for months, I decided to put my thoughts into writing.

The Law Union

Who are they? The email identifies three “co-chairs” of the group. The co-chairs are third-year students at the law school. They use a Gmail address to send their mail. They are not listed on either the Faculty of Law or the Student Law Society websites. In fact, other than their mention in Ultra Vires two weeks ago, I cannot find any evidence that they actually exist.

My suspicion is that they formed for the specific purpose of complaining about this. My further suspicion is that they are simply a few students who learned how to write a demand letter at their summer jobs and are itching to try out their new weapons. My opinion is that they may be the reason people don’t like lawyers. I could be wrong about these three things. I am open to correction (luckily nobody reads this blog, so I will remain correct).

The Issue

At this point, I realized I should have been writing this entry in the style of a case brief. Just for fun.

So the issue is that rather than giving leftover money to the students (as Osgoode’s student paper does) or simply investing the money in next year’s paper, the Ultra Vires [UV] board has been giving the extra money as honorariums. These honorariums range (according to the newspaper) from $500–$1500. The Law Union [UTLU] objects to this practice. I have no such objection.

The Arguments

That’s our money!

No, it isn’t. UV is funded by advertising. It gets no funding from the law school or our student union.

But they get office-space!

True. If the Faculty of Law is like the rest of UofT, however, UV pays (a token amount) to rent that office. In that case, we would lose no money. In the case that the office is truly free to UV, I believe that we get our money’s worth out of the paper.

They’re volunteers. Volunteers shouldn’t expect to get paid.

Two problems here: (1) they don’t expect anything, and (2) they are not being paid. The money they get at the end is contingent on the paper bringing in more money than it spends. If they lose an advertiser or have unexpected costs, they get less or don’t get anything. Also, the money is not payment (i.e. not a salary), it is an honorarium. Non-profits often give honorariums to people who volunteer for them. Ever go to a presentation and see someone jump up at the end and give the speaker a mug or flowers or other gift of some sort? That’s an honorarium. When I chaired the student life committee (such as it was) for SAC-UTM, I received a certificate and a cheque for $400 at the end of the year as a thank you for all the work I put in. It is common practice for non-profit groups to reward volunteers. Further, even if it were a salary, non-profits are fully entitled to pay salaries. If you really have an issue, you should take on UTSU, who not only pay salaries and honorariums, but receive money directly by student levy.

But volunteers should do it solely out of the goodness of their hearts!

Maybe so. But there is no reason to think that the editors at UV do it for any other reason. The payout isn’t guaranteed. And if they are doing it for the money, then they are obviously idiots. If they took the time they spent on the paper and got a job at McDonald’s they would earn much more.

But volunteers at association X don’t get honorariums!

Well, then take it up with X. Obviously, if they receive funding from SLS or the Faculty, they won’t be able to pocket the money. That funding comes out of a pool set aside for club expenses. If the club is totally self-sufficient, then, barring any other regulations, it’s their prerogative to give or not. If the honorarium makes a difference to you, then volunteer for UV; I hear they’re looking.

This entry is too long!

Nobody reads my blog, so you don’t exist. Clearly, you have more pressing matters to address.

They get to use the Faculty of Law name and distribute in the school, we control them!

There might be something to that. Certainly, if the Faculty decided that they didn’t like the practice they could make access to the school and it’s name contingent on doing something else with the money. Talk to the Dean. If the Faculty has no problem, then UV has no problem.

Conclusion

I’m cutting the entry artificially short perhaps. I’m stopping not because I’m out of arguments and counter-arguments, but because I’m out of time.

UV is self-sufficient. They can do whatever they want to do with their money (as long as it’s legal). In the last issue, the editor compiled statistics from surveys submitted by 2L students after their On-Campus Interviews. These statistics are well-worth whatever honorarium she gets. The students at the Faculty of Law get more value out of the paper than they theoretically spend on it.

The students at UTLU ought to reflect a little bit more and consider doing something of value themselves before sending bullying letters filled with unsubstantiated claims to try and take things away from other people. It’s obvious that people aren’t going to like my generation of lawyers any more than the last.