IPRs in Court – Recent
Development in Finland and
Abroad
Ville Oksanen
Helsinki Institute for Information
Who’s talking..
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•
•
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L.LM. (OTK)
At HIIT since May 2001
At Berkeley October 2001-December 2002
Current research:
– Trusted computing, Microsoft Palladium and EUCD
– The (online) grassroot movements against copyright and
DRM and their economical and political influence.
• Ph.D student at University of Joensuu
(Economics)
• Founder, Electronic Frontier Finland
Ville Oksanen
Helsinki Institute for Information
Finnish Cases
Ville Oksanen
Helsinki Institute for Information
Market Court MAO:156/03 I
• Facts:
– An arbitration decision 1993 -> The license
payment was bind to the revenue from
advertisements
– Gramex (a copyright society for performing
artists and producers) had demanded different
license payments from different commercial
radios.
– For example (only) Radio Nova had to pay 5M
mk minimum payment
Ville Oksanen
Helsinki Institute for Information
Market Court MAO:156/03 II
• The question: Did Gramex have any
justifiable grounds for different licensing
schemes or was it misusing its dominant
market decision
• A company,which is in dominant market
position, is not allowed to threat differently
its customers without a justifiable reason.
Ville Oksanen
Helsinki Institute for Information
Market Court MAO:156/03 III
• Gramex:
– A justifiable reason existed, because certain
radio stations were using “Top40” music so
much that the listeners didn’t want to buy
those CDs anymore
– A second reason was that only certain radio
stations were broadcasting on national level
(more that 1,4M listeners) and these stations
were causing more harm than their more
geographically limited counterparts
Ville Oksanen
Helsinki Institute for Information
+
Effect to CD-sales
Radio performances
Ville Oksanen
Helsinki Institute for Information
The demand for music in case of the blanket license
Dbighit
License costs
Dnormal
Pblanket
Dnewartist
Number of radio performances
Ville Oksanen
Helsinki Institute for Information
Market court’s opinion
• Gramex has failed to show evidence that too
much exposure from radio is causing harm to
record sales
• On the contrary, the evidence submitted to
the court indicates that exposure has a
positive effect on record sales
• The license agreements should have been
transparent anyway, which was not the case
Ville Oksanen
Helsinki Institute for Information
The verdict
• Gramex was misusing its dominant
market position by using discriminatory
license schemes
• The sanction: 250000€ fee + 50000€
for lawyers fees
• 150000€ optional penalty, if Gramex
continues to use discriminatory license
schemes
Ville Oksanen
Helsinki Institute for Information
KKO 2002:101
• The question:
– If a taxi-driver is listening a CDs or radio while
he has customers in the car, does that fall
under the copyright holder’s rights (public
performance)?
Ville Oksanen
Helsinki Institute for Information
The outcome (7/4)
• The majority: ”The performance in question is
related to commercial activity...... The
audience is not limited beforehand…the main
point is the whole customer base, not the
customers who are using the service at the
same time.”
• The minority: ”The main service for the
customer is the ride itself… Car brand, car
accessories, the music… secondary issues.
Many times the needs of the passengers
would be best fulfilled by turning of the radio”
Ville Oksanen
Helsinki Institute for Information
What will follow?
• The majority argues that the benefits to the
business are not important, and the rights of
the copyright holder has to be interpreted
strictly (or literally)
– It does not matter that someone already pays for the
music (radio station)
• The majority argues that the audience does
not have be at the same time at the place of
the performance -> the scope of public
performance…
• Who and how to decide the right license fee
(22 EUR / year / taxi)
Ville Oksanen
Helsinki Institute for Information
KKO:2003:88
• The question:
– Is it legal to resell software, which is meant to
be used only for upgrades or marketing
purposes
• The facts:
– A company had repackaged and sold software
packages, which were meant to be used for
marketing purposes or upgrades.
Ville Oksanen
Helsinki Institute for Information
KKO:2003:88 – The outcome
• The first sale doctrine applies to also
computer software
• Thus it is not possible to limit the resale
of software by using copyright
• The decision applies only to “boxed
software” (physical copies), the first sale
does not apply if the works exists only in
digital form
Ville Oksanen
Helsinki Institute for Information
What will follow?
• It’s impossible to price discriminate the
customers if the software is sold in physical
boxes
• Stricter contracts (even if the sale is not a
copyright violation, it may be a contract
violation)
• How wide is the decision (is it legal to use a
single-user version is a server etc?)
Ville Oksanen
Helsinki Institute for Information
US cases
Ville Oksanen
Helsinki Institute for Information
DVD-case
• Protected with Content Scramble System
(CSS)
• Also Regional Playback Control (RPC II)
• Macrovision
• Goals:
– Prevent digital copying
– Add control how material can be viewed
– Prevent consumers buying DVDs from another regions
• Licensed by DVD CCA
Ville Oksanen
Helsinki Institute for Information
DeCSS
• CSS was broken by a group of hackers (Jon
Johansson), which created a program called
DeCSS
• CSS was poorly designed (40 bit crypto etc),
which made the attack easy
• Full access to files
• Possibility to convert to other formats like
DivX
• Unlicensed software players (to Linux )
Ville Oksanen
Helsinki Institute for Information
Perl:
Shortest DeCSSimplementations
#!/usr/bin/perl -w # 531-byte qrpff-fast, Keith Winstein and Marc Horowitz <sipb-iapdvd@mit.edu> # MPEG 2 PS VOB file on stdin -> descrambled output on stdout #
arguments: title key bytes in least to most-significant order
$_='while(read+STDIN,$_,2048){$a=29;$b=73;$c=142;$t=255;@t=map{$_%16or$t^=$c^=(
$m=(11,10,116,100,11,122,20,100)[$_/16%8])&110;$t^=(72,@z=(64,72,$a^=12*($_%16 2?0:$m&17)),$b^=$_%64?12:0,@z)[$_%8]}(16..271);if((@a=unx"C*",$_)[20]&48){$h
=5;$_=unxb24,join"",@b=map{xB8,unxb8,chr($_^$a[--$h+84])}@ARGV;s/...$/1$&/;$
d=unxV,xb25,$_;$e=256|(ord$b[4])<<9|ord$b[3];$d=$d>>8^($f=$t&($d>>12^$d>>4^
$d^$d/8))<<17,$e=$e>>8^($t&($g=($q=$e>>14&7^$e)^$q*8^$q<<6))<<9,$_=$t[$_]^
(($h>>=8)+=$f+(~$g&$t))for@a[128..$#a]}print+x"C*",@a}';s/x/pack+/g;eval
C- implementation (Author: Charles M. Hannum):
#define m(i)(x[i]^s[i+84])<< unsigned char
x[5],y,s[2048];main(n){for(read(0,x,5);read(0,s,n=2048);write(1,s
,n))if(s[y=s[13]%8+20]/16%4==1){int i=m(1)17^256+m(0)8,k=m(2)0,j=m(4)17^m(3)9^k *2k%8^8,a=0,c=26;for(s[y]-=16;--c;j*=2)a=a*2^i&1,i=i/2^j&1<<24;for(j=127;++j<n
;c=c>y)c+=y=i^i/8^i>>4^i>>12,i=i>>8^y<<17,a^=a>>14,y=a^a*8^a<<6,a=a>>8^y<<9,k=s
[j],k="7Wo~'G_\216"[k&7]+2^"cr3sfw6v;*k+>/n."[k>>4]*2^k*257/8,s[j]=k^(k&k*2&34) *6^c+~y;}}
Ville Oksanen
Helsinki Institute for Information
Ville Oksanen
Helsinki Institute for Information
Qrpff Tie
Qrpff, a PERL based version of the
famous DECSS. Code written by Keith
Winstein and Marc Horowitz.
Price: $34.00
Ville Oksanen
Helsinki Institute for Information
As music songs
• Joe Wecker and Don’t Eat Pete
• Shane Killian:
Ville Oksanen
Helsinki Institute for Information
DVD-CCA v. Bunner
• Based on trade secret, not copyright
• California Superior Court
– Preliminary injunction granted
• California Appellate Court
– Preliminary injunction not granted
• California Supreme court:
– Still open
Ville Oksanen
Helsinki Institute for Information
DVD-CCA v. Pavlovich
• The question:
– Can a person, who has not connections to
California, be still judged there because he
knew that his publication could cause "general
effects" on the motion picture and technology
industries in California?
• California Supreme court: It can’t
Ville Oksanen
Helsinki Institute for Information
Universal v. Reimerdes
• The question:
– Is DeCSS a circumvention device defined in
the Digital Millenium Copyright Act and does
the publication of DeCSS still fall under the
scope of free speech?
Ville Oksanen
Helsinki Institute for Information
Universal v. Reimerdes II
• EFF tried to handle
the defense (with
bad results)
• Judge Kaplan:
DeCSS is a
circumvention
device
• Appeal to Second
Circuit – the
answers were:
Ville Oksanen
Helsinki Institute for Information
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Battle lines
ACLU, for American Civil
•
Liberties Union, Digital Future
Coalition (DFC), American
Library Association (ALA),
American Research Libraries
(ARL), Music Library
Association (MLA)
Computer Scientists:
Law Professors:
Cryptographers:
Journalists and Publishers,
Online News Association,
Reporters' Committee for
Freedom of the Press,
Newspaper Association of
America, Student Press Law
Center, Wired, Pew Center on
the States, Silha Center for
Media Ethics and Law, College
of Communications - CSU,
Fullerton
Fair Use Interests: Dr. Siva
Vaidhyanathan, Mary Wallace
Davidson, Ernest Miller,
Christina Olson Spiesel
Ville Oksanen
ACM Law Committee
Helsinki Institute for Information
Industry organizations:Recording
Industry Association of America (RIAA);
American Federation of Musicians of the
United States and Canada (AFM);
American Federation of Television and
Radio Artists (AFTRA); American Film
Marketing Association (AFMA);
American Society of Composers, Authors
and Publishers (ASCAP); Broadcast
Music, Inc. (BMI); American Society of
Media Photographers (ASMP);
Association of American Publishers
(AAP); Business Software Alliance (BSA);
Directors Guild of America, Inc. (DGA);
Graphic Artists Guild; Interactive Digital
Software Association (IDSA); National
Association of theater Owners (NATO);
National Cable Television Association,
Inc. (NCTA); National Collegiate Athletic
Association (NCAA); National Football
League and National Football League
Properties, Inc. (NFL); National Hockey
League (NHL); National Music
Publishers' Association (NMPA); office of
the Commissioner of Baseball; Producers
Guild of America (PGA); Professional
Photographers of America (PPA); Reed
Elsevier, Inc.; Satellite Broadcasting and
Communications Association (SBCA);
Screen Actors Guild, Inc. (SAG); Software
& Information Industry Association
(SIAA); and Writers Guild of America,
West, Inc. (WGA)
Answer: yes/no
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United States vs. ElcomSoft
• Russian Dmitry Sklyarov wrote a
circumvention software for Adobe Ebooks
while he was working for Elcomsoft in
Moscow
• He was arrested by FBI after he participated
to DefCon in 2001
– 50 000 USD bail
– The charge was dropped after he promised to witness
against Elcomsoft
• 17.12.2002 a verdict: Elcomsoft didn’t
knowingly violate DMCA and is thus
acquitted from criminal charges
Ville Oksanen
Helsinki Institute for Information
Eldred v. Ashcroft
• The questions: Is Sonny Bono copyright
act against the US constitution
– The law extended the copyright to 70 years
after the author’s death and applied also to
existing works
– The constitution: only limited times
Ville Oksanen
Helsinki Institute for Information
Economic justification..
• A statement to
support Eldred by
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George A. Akerlof
Kenneth J. Arrow
Timothy F. Bresnahan
James M. Buchanan,
Ronald H. Coase
Linda R. Cohen
Milton Friedman
Jerry R. Green
Robert W. Hahn
– Thomas W. Hazlett C.
Scott Hemphill,
– Robert E. Litan,
– Roger G. Noll,
– Richard Schmalensee
– Steven Shavell
– Hal R. Varian
– Richard J. Zeckhauser
Ville Oksanen
Helsinki Institute for Information
..does not exist?
• Comparing the main economic benefits and
costs of the CTEA, it is difficult to understand
term extension for both existing and new works
as an efficiency-enhancing measure. Term
extension in existing works provides no
additional incentive to create new works and
imposes several kinds of additional costs. Term
extension for new works induces new costs and
benefits that are too small in present-value terms
to have much economic effect. As a policy to
promote consumer welfare, the CTEA fares even
worse, given the large transfer of resources from
consumers to copyright holders.
Ville Oksanen
Helsinki Institute for Information
The US Supreme Court
…Beneath the facade of their inventive
constitutional interpretation, petitioners
forcefully urge that Congress pursued very
bad policy in prescribing the CTEA’s long
terms. The wisdom of Congress’ action,
however, is not within our province to second
guess. Satisfied that the legislation before us
remains inside the domain the Constitution
assigns to the First Branch, we affirm the
judgment of the Court of Appeals.
Ville Oksanen
Helsinki Institute for Information
MGM v. Grokster
• The question: Can the company behind
a P2P-software be held liable for the
copyright violations committed by the
users?
• The court: No. (under appeal)
Ville Oksanen
Helsinki Institute for Information
Comments – Questions?
Ville Oksanen
Ville.Oksanen@hiit.fi
http://www.hiit.fi/de/oksanen.ht
ml
Ville Oksanen
Helsinki Institute for Information