@wsj: A Copyright Coup in Washington: The new Librarian of Congress ousts a federal copyright defender [Congress should investigate]

[Editor Charlie sez: This opinion post is from the Wall Street Journal editorial board calling out the Librarian of Congress for a “botched personnel dispute” that is tainted by Hayden’s longstanding relationship with entities funded by Google.]

PHOTO: ASSOCIATED PRESS

Most Americans think of Google as a search engine doing unalloyed social good, but the company also wants to make money and wield political influence along the way. So you don’t have to be a conspiracy theorist to notice that an abrupt change of leadership at the U.S. Copyright Office is good news for Google, which aims to pay less for profiting from the property of others.

Maria Pallante served for more than five years as the U.S. register of copyrights, a division of the Library of Congress. Two weeks ago Ms. Pallante was reshuffled to an advisory post for “digital strategy” she never sought, a job that included expanding the library gift shop. Three days later she resigned in a letter to the Librarian of Congress, Carla Hayden, who had been sworn in mere weeks earlier. What happened?

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Ms. Hayden’s allies say she simply wants to install her own loyalists, and maybe so. Ms. Pallante favored reorganizing the copyright office as an independent agency, which might have felt threatening to Ms. Hayden. But we can find no similar removal of a copyright register, and the details are unusual.

 The Library’s public announcement said nothing more about Ms. Pallante’s tenure than that it “laid the groundwork for important modernization.” But in a memo to Ms. Pallante that leaked to the press, Ms. Hayden stipulated that her new job did not include “any communications” with Congress, which was reviewing copyright laws with Ms. Pallante. The House Judiciary Committee put out a bipartisan statement calling Ms. Pallante’s departure a “tremendous loss.”

There is some circumstantial evidence that Google’s lobbying influence was brought to bear in removing Ms. Pallante, though both Google and Ms. Pallante declined to talk to us. Google’s business model is essentially making money off other people’s content, and the company’s strategy has been to infringe on copyrighted material like books and fight it out later in court. The copyright office administers laws that protect owners.

For example, Ms. Pallante’s office opposed a Justice Department interpretation of licensing that would have undercut collaborations. As it happens, that change was reportedly pushed by a former outside counsel for Google who had moved over to Justice. Ms. Pallante’s view won in court.

Earlier this year the Federal Communications Commission proposed something known as the set-top box rule. The thrust was to force cable companies to build a universal adapter so Google and others could broadcast content without paying licensing fees or abiding by carriage agreements. Google supported the new rule. Less pleased were creators, who wouldn’t be paid for their work.

Read the full post on the Wall Street Journal 

 

Reply to Gary Shapiro

Gary Shapiro, the long-time head of the Consumer Electronics Association (now called the Consumer Technology Association), posted a comment to an Artist Rights Watch post about Maria Pallante’s sacking at the Copyright Office.  [UPDATE from Charlie: By popular demand, we have posted Mr. Shapiro’s comment as its own post.]  The consensus of the editors here is that we’re both flattered and concerned that Mr. Shapiro is posting comments on ARW on a Sunday night. That effort deserves to be taken seriously and replied to.

First of all–it should be noted that Mr. Shapiro’s post falls into that category of public statements that I’d call a “non-denial denial”.

It’s also important to note that Mr. Shapiro’s comment is all about Washington, lobbyists, who did what to whom, settling old scores among the coastal elites, who owns who, who paid off who to do what, and so on.  The funniest line in his post was that Google isn’t a bully.  Now that is hysterical for those who have dealt with YouTube or tried to get anything from a jihadi recruitment video to “Banging Up for Dummies” taken down from any Google property.  Almost as funny as blaming the Sony hack on North Korea.

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that’s Miss-iss-ippi…

I fear that it is necessary to point out to Mr. Shapiro that this blog is Artist Rights Watch, not Lobbyist Rights Watch, or Let’s Watch the Lobbyists.  This may come as a shock to someone like Mr. Shapiro who’s been at this for so long, but it is very, very likely that anyone who reads this blog neither has any idea who he is nor cares very much.

If our readers know of the Consumer Electronics Association, it’s likely that they know the organization from its membership in the MIC Coalition.

 

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The MIC Coalition is, of course, the multi-trillion dollar lobbyists who are trying to screw what’s left of the songwriting community and stop artists from being paid fairly for radio airplay.

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Or they might know the Consumer Electronics Association from its funding of the group Fight for the Future, which conducted a rather shadowy campaign against the Copyright Office, including making statements at odds with the facts in fundraising emails.

FFTF Email

That statement in the box?  It never happened.

Here’s an excerpt from Schedule B of the 2014 tax return for Center for Rights in Action which is parent to Fight for the Future:

FFTF CEA

And then there was the classic line from David Lowery addressed to Michael Petricone (Mr. Shapiro’s right hand at CEA) when both were on a panel at the Future of Music Coalition Summit Poobahery in Washington regarding CEA’s support of the ill-fated Internet Radio Fairness Act:  “Stop making shit up, man!”

Those are probably the ways that the vast majority of people who read this blog would know of the Consumer Electronics Association.

It would be well for Mr. Shapiro to observe that 2016 has seen the future–more artists have stopped looking to lobbyists to solve their problems.  Those lawsuits against Spotify, Rhapsody, Sirius XM, Pandora and even the U.S. Department of Justice?  All brought by individual creators with some courageous lawyers who are willing to take a chance–because of the statutory damages and attorneys fees provisions of the Copyright Act without which those creators would have to take yet more bullying from Mr. Shapiro and his members, Google or otherwise.

So hopefully Mr. Shapiro will understand my reaction to this statement in his comment:

[T]hankfully we won many battles as new forms of technology created huge new opportunities for our members…and for content creators.

If the last 15 years of Mr. Shapiro’s travails are what constitutes his “help” in fighting “battles”, if what we have to show for his “winning” these “battles” is the absolute skewering of songwriters, artists, authors, record producers, film makers, and everyone who works in these endeavors–not to mention the biggest income transfer in commercial history from creators to new boss tech companies as well as the commoditization of art and artists–I have one reaction that I think will be shared by “content creators” who read this blog.

Please stop helping us.

Google Fires Head of U.S. Copyright Office

In a typically backstabbing lame duck kabuki dance, Google has fired Maria Pallante, the head of the U.S. Copyright Office (see Wall Street Journal “A Copyright Coup in Washington“).  This is a real tragedy because Register Pallante was even handed and concerned about treating everyone involved with copyright fairly–consumers as well as creators, not to mention cooperating with Google and Amazon in permitting the filing of millions of NOIs to the great detriment of songwriters.

According to Billboard:

Pallante was locked out of her computer this morning, according to two sources who spoke with Library employees. Earlier, [the nominal head of the Library of Congress]  had called several members of Congress to tell them about her decision. Later, she called the heads of several media business trade organizations to give them the news, according to one who received such a call.

It is hard to believe that the nominal head of the Library of Congress would fire Register Pallante without top cover from the White House–of course, that’s a little odd since the Copyright Office is in the Library of Congress.

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These lines get a bit blurry for Google who doesn’t really care much about who needs to be bought off.  The White House may very well have been instructed to fire Pallante by Google lobbyist Johanna Shelton or Google’s White House fixer Ginny Hunt.  Time will tell.

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And then there’s the close relationship between Public Knowledge and Google–Google was ordered to disclose its funding of Public Knowledge by a federal judge:

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Public Knowledge recently dropped a hit piece on Pallante, claiming that the Copyright Office was captured by creators.  Right, that’s why the Copyright Office allowed the mass filing of millions of NOIs to the great detriment of songwriters and to the great benefit of Google and Amazon.

In a bizarre example of Washington corruption, songwriters recently withstood an assault by the Google Department of Justice Antitrust Division on 100% licensing that supposedly emanated from Renata B. Hesse, who formerly represented Google in antitrust cases.  Of course, the current CEO of Public Knowledge was formerly the Chief Counsel of the Antitrust Division (read his Revolving Door profile on Open Secrets here).

Google White House Meetings

Make no mistake, this is Google flexing its considerable pay-to-play muscle.  The timing is predictable–Google fires Pallante days before a general election, in the waning days of the Obama Administration.  They don’t give a good goddamn about whether it’s the Library of Congress or the Vulcan Science Academy.  They control the players and they’ll do what they want especially when they think no one is looking.

We’re looking.

 

@devlinhartline: Professors Mislead FCC on Basic Copyright Law

[Editor Charlie sez:  The title of this post could have been “Usual Suspects Are At It Again”]

In a letter submitted to the FCC late last week defending the Commission’s deeply flawed set-top box proposal,[1] a group of professors make an incredible claim: Everyone is perfectly free to distribute copyrighted works online however they please. No license? No problem! According to these professors, many of whom teach copyright law, copyright owners have no distribution right in cyberspace. If you think this sounds wrong, you’re right! This claim sounds ridiculous because it is ridiculous, and it’s simply amazing—and troubling—that professors would mislead the FCC in this way.

The professors argue that a copyright owner’s “right to distribute encompasses the distribution of physical copies of a work, not electronic transmissions.” In support, they cite no case law whatsoever. There’s a good reason for this: None exists. The reality is that every single court that has ever considered this argument on the merits has rejected it. Time and again, this argument has been summarily dismissed by the courts. As the Nimmer on Copyright treatise puts it: “No court has held to the contrary on this issue[.]” Yet, the professors present this to the FCC as an accurate description of the law, with no equivocation whatsoever.

Read the post on Center for the Protection of Intellectual Property

@telecomsense: Public Bully–Public Knowledge President Threatens FCC Commissioner

Last week, the word going around town–and in the “Twittersphere”–was that Gene Kimmelman, the president of advocacy group Public Knowledge, was threatening that if FCC Commissioner Rosenworcel didn’t “get in line” behind Chairman Wheeler’s set-top box proposal that he would oppose her re-nomination for another term as an FCC Commissioner.  This article in Fortune supports the rumor with a quote from Kimmelman that “[w]e’ll hold everyone accountable . . .  [for not supporting the Chairman’s set-top box plan].”  If you’re anything like me, you’re probably asking, “who does this?

Who Does This?

In communications circles, perhaps no group has been as successful at converting political capital into the old-fashioned kind as Public Knowledge.  After the group’s previous president, Gigi Sohn, became a senior adviser to FCC Chairman Tom Wheeler, Public Knowledge has carved out a lucrative niche for itself as a critical ally for commercial interests with regulatory goals, i.e., either seeking to escape scrutiny (e.g., Google), or to saddle their rivals with more regulation (e.g., Netflix and the CLECs).

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The group’s current president, Gene Kimmelman, before taking over at Public Knowledge, was himself a political appointee for the first half of the Obama administration–as a Deputy Assistant Attorney General in the Antitrust Division of the Department of Justice.  Kimmelman, as his Wikipedia page will tell you, “is a consumer protection advocate who specializes in competition law and United States antitrust law.”

If you’ve got the political power, I can kind of see–in a TV bad guy sort of way–why you might try to deliver a political threat to an FCC Commissioner; assuming you thought your victim believed you had the power to deliver on the threat, and the issue was so important to you that you didn’t mind looking like a cliché and a jerk at the same time.  But still, why tell the world?

It seems to me that, if you go public with your threat, you make it harder for your threat to work.  After all, the smaller the group of people that knows about your threat, the easier it is to give your target a “face-saving” way out.

Read the post on Jonathan Lee’s Telecom Sense blog

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Revolving Door Person Gigi B. Sohn, co-founder of Public Knowledge and policy advisor to FCC President Tom Wheeler

@tedstew: BREAKING: FCC Pulls Set-Top Box Plan From Meeting Agenda

The FCC has called off a planned Thursday vote on a proposal that would require that cable and satellite operators offer a free app so subscribers could forgo the rental of a set-top box.

“We are still working to resolve the remaining technical and legal issues and we are committed to unlocking the set-top box for consumers across this country,” FCC Chairman Tom Wheeler, Commission Mignon Clyburn and Commissioner Jessica Rosenworcel said in a statement released about a half an hour before the meeting.

Read the post on Variety

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The copyright-destroying proposal was backed by Google Shill Lister Public Knowledge, whose co-founder and revolving door person, Gigi B. Sohn, now works as consigliere for Obama bundler Tom Wheeler.

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Gigi B. Sohn

@IFPI_org: World’s Largest Stream Ripping Site Faces International Legal Action

[Editor Charlie sez: Thanks to YouTube, stream ripping is the latest tool of bootleggers and pirates.  Here’s how it works:  YouTube allows live shows to be posted as videos, stream rippers grab the audio files and then upload those files as bootlegs to be sold as mp3s or monetized as “lyric videos”.  Google then serves “address unknown” NOIs on those bootleg recordings with the Copyright Office to avoid paying mechanical royalties to songwriters OR being audited.  More racketeering from Google, that purposely launches products they can’t control that create harm Google can predict. Maybe the Department of Justice could spend more time prosecuting criminals than harassing songwriters with their rogue antitrust division.  Every time the recording industry has to bring these lawsuits instead of the government bringing criminal prosecutions, it just means that the government avoids having do do actual work.]

London and Washington, DC, 26th September 2016 – Organisations representing record companies in the US and UK took legal action today against Youtube-mp3.org, the world’s largest site dedicated to offering illegally “stream ripped” music.  Both the site and its operator have generated millions of dollars without paying any remuneration to artists and rights holders. The activities also breach YouTube’s Terms of Service [that YouTube does nothing to stop].

Stream ripping is the process of ‘ripping’ or creating a downloadable file from content that is available to stream online.  It is often done with music videos, to create copies of tracks that can be downloaded and listened to offline or on other devices.

IFPI Chief Executive Frances Moore said:

“This is a coordinated action to protect the rights of artists and labels from the blatant infringements of YouTube-mp3, the world’s single-largest ‘stream ripping’ site.

“Music companies and digital services today offer fans more options than ever before to listen to music legally, when and where they want to do so – over hundreds of services with scores of millions of tracks – all while compensating artists and labels. Stream ripping sites should not be allowed jeopardise this.”

Cary Sherman, the Chairman and CEO of the Recording Industry Association of America (RIAA) said:

“This site is raking in millions on the backs of artists, songwriters and labels.  We are doing our part, but everyone in the music ecosystem who says they believe that artists should be compensated for their work has a role to play.  It should not be so easy to engage in this activity in the first place, and no stream ripping site should appear at the top of any search result or app chart.”

Geoff Taylor, BPI Chief Executive, said:

“It’s time to stop illegal sites like this building huge fortunes by ripping off artists and labels.  Fans have access now to a fantastic range of legal music streaming services, but they can only exist if we take action to tackle the online black market.  We hope that responsible advertisers, search engines and hosting providers will also reflect on the ethics of supporting sites that enrich themselves by defrauding creators.”

Alison Wenham, CEO of WIN (Worldwide Independent Network) & AIM (Association for Independent Music) endorsed the action, adding:

“Stream ripping is not a victimless crime, it involves ripping off the artists and companies who invest their time and money into making music for the public to enjoy.  The more stream ripping takes place, the less investment into music will be made to the ultimate detriment of music fans.”

Richard Burgess, CEO of A2IM, representing US independent record labels said:

“Stream ripping is yet another illegal activity that deprives artists, songwriters, publishers, and labels of their rightful revenues and their ability to make a living. It must be stopped immediately.”

In the US, legal proceedings were filed in federal court in California against the site and its operator, Philip Matesanz, for flagrantly violating copyrights.  In the UK, the BPI, representing UK record labels, put the stream ripping site on formal notice of intended legal action if it does not cease infringing.

Stream ripping is the fastest growing form of music piracy globally and has now replaced other forms of downloading as the most prevalent form of online music piracy.  Research published earlier this month by IFPI and Ipsos finds that stream ripping sites are operating on a massive scale, with 49 per cent of all 16-24 year olds engaged in the activity, according to Ipsos.

YouTube-mp3.org is the largest stream-ripping site with more than 60 million unique users per month.  Based in Germany, the site has a global user base and provides a simple way of creating an audio file from a YouTube video.

Despite paying no money to the creators or owners of music, stream ripping sites are using the high levels of traffic they generate to make money from advertising.  The prominently placed adverts on YouTube-MP3, often from major brands, are estimated to generate hundreds of thousands of dollars per month for YouTube-mp3.

-Ends-

For further information please contact:

IFPI:  Adrian Strain Adrian.strain@ifpi.org, John Blewett john.blewett@ifpi.org +44 (0)20 7878 7939 / 7935

 BPI: Gennaro Castaldo, gennaro.castaldo@bpi.co.uk +44 (0)20 7803 1326 / +44 (0)7801 194 139

RIAA:  Jonathan Lamy, jlamy@riaa.com, Cara Duckworth, cduckworth@riaa.com +1 202 857 9627

Notes to editors:

About IFPI

IFPI is the organisation that promotes the interests of the international recording industry worldwide. Its membership comprises some 1,300 major and independent companies in 60 countries. It also has affiliated industry national groups in 57 countries.  IFPI’s mission is to promote the value of recorded music, campaign for the rights of record producers and expand the commercial uses of recorded music in all markets where its members operate.

About RIAA

The Recording Industry Association of America® (RIAA) is the trade organization that supports and promotes the creative and financial vitality of the major music companies. Its members comprise the most vibrant record industry in the world, investing in great artists to help them reach their potential and connect to their fans. Nearly 85% of all legitimate recorded music produced and sold in the United States is created, manufactured or distributed by RIAA members.

About the BPI (British Phonographic Industry) Promoting British Music

The BPI was formed in 1973 as a representative voice of the UK recorded music business.  As a trade association it promotes recorded music in the UK and worldwide, including through its overseas trade missions and the Music Export Growth Scheme, and also champions the rights and interests of a broad range of members through its content protection work.  Its membership is made up of over 370 independent music labels and the UK’s three major record companies, which in 2015 collectively accounted for over 80 per cent of the recorded music consumed in the UK – the world’s third largest music market – and whose artists claimed around one in every six albums sold around the world.