The fourth book in the Harry Potter series is the subject of another lawsuit!

Representatives for the late British author Adrian Jacobs have extended their plagiarism lawsuit and filed a copyright infringement suit against publishing house Scholastic Inc. in federal court in New York.  Jacobs’ estate alleges that the best-selling “Harry Potter and the Goblet of Fire” is “substantially similar” to a book written by Jacobs in 1987.

As Bloomberg reports, the estate claims that Harry Potter author, J.K. Rowling, and Jacobs were represented by the same literary agent.  According to the estate, the agent, Christopher Little, had copies of Jacobs’ book titled “The Adventures of Willy the Wizard” years before “Goblet” was published.  “The central theme of each work – a yearlong wizard contest – unfolds as similar characters enact parallel plot points,” the complaint alleges.  Jacobs’ book was published in the U.K. in 1987 and has not come out in the U.S.  “Goblet” was published in 2000.  The suit calls for Scholastic to recall all copies of the “Goblet” books and pay Jacobs’ estate all profits derived from its sale.

The Scholastic suit extends from a lawsuit currently pending in England.  As reported online, last year the estate sued Bloomsbury Publishing, the British publisher of “Goblet” for copyright infringement.  The suit added Rowling individually earlier this year.  Applications for summary judgment filed by Bloomsbury and Rowling are pending before the High Court. Rowling has previously described the initial lawsuit as “absurd.”

On July 1, 2010, the US Patent & Trademark Office and the National Telecommunications and Information Administration hosted a conference, “Copyright Policy, Creativity, and Innovation in the Information Economy,” that sought to ameliorate the ongoing struggle between fighting copyright piracy and encouraging creativity in today’s e-commerce ecosystem. The vast range of participants included law professors, economic policy analysts, the U.S. Secretary of Commerce, the U.S. Intellectual Property Enforcement Coordinator, and members of the Recording Industry Association of America, AT&T, Verizon Communications, the Motion Picture Association of America, Sony Music Entertainment, Microsoft, NBC Universal, Macmillan Publishers U.S.A., the American Society of Media Photographers, and the Entertainment Software Association spoke at the conference.

Amidst recent lawsuits like Viacom Int’l, Inc., et al. v. YouTube, Inc., et al., 07 Civ. 2103 (LLS), where the court’s decision turned on compliance with the 1998 Digital Millennium Copyright Act (DMCA), some at the conference voiced concern over the effectiveness of the DMCA’s safe harbor provisions and questioned how beneficial the twelve year old DMCA is in today’s marketplace.  In the legislative history of the DMCA, Congress recognized that “by limiting the liability of service providers, the DMCA ensures that the efficiency of the Internet will continue to improve and that the variety and quality of services on the Internet will continue to expand.”  Thus, in the interest of fostering the growth of the Internet and the creative free expression thereof, the DMCA’s safe harbor provision shields the provider from liability as long as a service provider takes down infringing material when notified.  When the ISP is not notified, online copyright infringement inevitably persists.

Focusing on the sheer amount of money lost to infringement and the chilling effect that is created when a lack of competition exists due to consumers finding products for free, many at the conference believe that in order for the DMCA to work today there needs to be more participation from content providers, platform providers, and consumers – the key player being internet service providers.  Whether you are an ISP seeking the limited liability of the DMCA or the producer of online copyrighted material seeking to prevent infringement, it seems clear that finding the best balance between the two not only requires cooperation, but a clear division of responsibility thereof.

On Monday, August 9, 2010 Verizon Communications and Google proposed an open Internet framework as an outline for draft federal legislation – a framework that the two companies believe will safeguard a Net neutral Internet without excluding prospective service options for network operators if adopted.  Citing to consumer protection and the promotion of the continued investment in broadband access, the proposal posits that the framework should include, among other things: full FCC enforcement of openness principles that ensure consumer access to all legal content on the Internet and freedom to use any legal applications, services, and devices; a prohibition against discriminatory practices, such as a prioritization of Internet traffic; transparency rules requiring disclosure in plain language; and opportunity for an ISP complying with the openness principles to offer other additional or differentiated services.

Although the proposal holds no actual authority, it is nonetheless controversial and has been criticized by many.  For example, under the proposal “the FCC could impose a forfeiture of up to $2,000,000 for knowing violations of the consumer-protection or non-discrimination provisions,” a fine much too low for some critics.  The proposal is also said to not go far enough in that it exempts mobile Internet traffic, save the transparency requirement.  Others claim that the proposal allows network operators to implement “reasonable network management” techniques even if the management would otherwise violate Net neutrality, such as prioritizing some classes of Internet activity like video “to reduce or mitigate the effects of congestion on its network.”

The proposal highlights the ongoing struggle between network neutrality proponents and opponents and the need to move the process forward.  In the words of the authors of the proposal, Eric Schmidt, CEO of Google, and Ivan Seidenberg, CEO of Verizon: “There are hundreds of millions of Internet users in the United States, and no two companies should be so presumptuous as to think they can solve this challenge alone.  It is up to policymakers to establish broadband policy for the country.”  Only time will tell how the policymakers react to the proposal.  We shall see.

Despite the National Institutes of Health (NIH) denial of three previous requests, three persons petition the Department of Health and Human Services to exercise its “march-in rights” under the Bayh-Dole Act. The petitioners, Joseph M. Carik, Anita Hochendoner, and Anita Bova, are representatives of the entire class of patients with Fabry disease. Fabry is a rare, genetic disease that affects the body’s ability to break down fats causing kidney and heart problems that can lead to death. The petitioners claim that they are suffering from a return of symptoms of Fabry disease due to Genzyme’s rationing plan, which cut their allowance to less than a third of the recommended dose. Genzyme issued its rationing plan following manufacturing problems in its Allston plant.

The Bayh-Dole Act granted universities the ability to control the rights of their inventions that resulted from federal funding, but also retained the ability to abrogate those rights under certain circumstances (“march-in”). Under 35 U.S.C. §203, a Federal agency, here the NIH, has the right to require the exclusive licensee of an invention, created under its funding agreement, grant a license to a “responsible applicant,” so long as the action “is necessary to alleviate health or safety needs which are not reasonably satisfied by the . . . licensee[.]”

Petitioners contend that NIH funding awarded to Dr. Robert J. Desnick of Mount Sinai School of Medicine lead to the discovery that enzyme replacement therapy with agalsidase beta (Fabrazyme®) can effectively treat Fabry patients. Under the Act, Mount Sinai exclusively licensed its subsequent patents, Nos. 5,356,804 “Cloning and expression of biologically active human alpha-galactosidase A,” and 5,580,757 “Cloning and expression of biologically active alpha-galactosidase A as a fusion protein,” to Genzyme. Petioners argue that Genzyme’s current inability to manufacture the requisite amount has adversely affected the health and safety of those patients with Fabry disease. Accordingly, the petition seeks an open license from NIH in order to allow responsible entities to manufacture, import, export, or sell Fabrazyme®.

Two years ago, the entertainment industry drafted colleges and universities into its ongoing war on piracy. Now it’s time for them to go to battle. As the AP reports, a provision of the Higher Education Opportunity Act of 2008 (PDF) will go into effect this month that will force institutes of higher education to police their Internet networks for piracy. If a college or university fails to implement “at least one ‘technology based deterrent,’” such as blocking file transfers, traffic shaping, or preventing access to peer-to-peer file transfer sites, then it risks losing its access to federal student financial aid.

Both the Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA) vigorously lobbied for this provision.  In most circumstances, it will not lead to increased enforcement, as most colleges and universities already employ these anti-piracy methods as well as respond quickly to “takedown notices” sent by copyright holders. The content industry hopes that this new requirement, along with other rules and regulations, will gradually change the way people think about piracy and lead to more people downloading files legally.

On July 9, 2010, the Honorable Nancy Gertner, U.S.D.C. granted defendant Joel Tenenbaum’s Motion for a New Trial or Remittitur in statutory damages, insofar as it seeks a reduction in the jury’s award  of $675,000.00.  The award was reduced by a factor of ten, $67,500.00, on the grounds that it is so grossly excessive as to violate the Constitution.  Defendant Joel Tenebaum used file-sharing software to illegally download and distribute thirty works of music, including Beck’s Loser and Nirvana’s Come As You Are, while a student at Boston University.

Although Tenebaum’s liability for infringement was not seriously in question, and Plaintiffs’ chosen statutory damages fell within the broad range of damages set by Congress, Tenenbaum argued the award exceeded any plausible estimate of the harm suffered by the plaintiffs and the benefits he reaped.  In her Opinion, Judge Gertner stated:

This award is far greater than necessary to serve the government’s legitimate interests in compensating copyright owners and deterring infringement. In fact, it bears no meaningful relationship to these objectives. To borrow Chief Judge Michael J. Davis’ characterization of a smaller statutory damages award in an analogous file-sharing case, the award here is simply “unprecedented and oppressive.” Capitol Records Inc. v. Thomas, 579 F. Supp. 2d 1210, 1228 (D. Minn. 2008). It cannot withstand scrutiny under the Due Process Clause.

While the plaintiffs, a group of the country’s biggest recording companies (Sony BMG Music Entertainment, Warner Bros. Records Inc., Atlantic Recording Corp., Arista Records LLC, and UMG Recordings, Inc.), may not be satisfied with the outcome, they should not feel like all is lost.  After all, their lawsuit against Tenenbaum is only one of thousands that they have brought against file sharers throughout the country.

Swedish intellectual property anarchists and abolitionists, the Pirate Party (Piratpartiet), are threatening to up the ante when it comes to bit torrent file sharing. The party, which rose from the ashes of the infamous “Pirate Bay” torrent tracking site, announced plans to host the controversial website from within Swedish Parliament. The party is relying on a provision in the Swedish Constitution that grants parliamentary immunity to members of the “Riksdag” governing body carrying out their mandate. Chapter 4, Section 8 of the Constitution reads:

No person may take legal action against a person who holds a mandate as a member of the Riksdag, or who has held such a mandate, deprive him of liberty, or restrict his movements within the Realm on account of an act or statement made in the exercise of his mandate

The immunity is limited to crimes punishable by less than 2 years imprisonment:

If, in any other case, a member of the Riksdag is suspected of having committed a criminal act, the relevant rules of law concerning arrest, detention or remand are applied only if he admits guilt or was caught in the act, or the minimum penalty for the offence is imprisonment for two years.

The Pirate Party is a limited-issue party, with its agenda focusing on non-commercial exploitation of copyright-protected material, abolishing the patent system, and protecting the privacy of citizens in an open society. Currently, no member of the party hold a seat in the Riksdag, and they need to capture roughly 4% of the vote to earn one. If they can pull off a victory similar to the 2009 European Parliament elections, where they earned 7.1% of the vote, running a non-commercial torrent index would be part of their elected mandate, thus allowing for their proposed immunity.

Furthermore, unless they admit to breaking the law, it does not appear that their immunity would be waived by the 2-year limitation since that is the maximum penalty under Swedish law.  The Swedish Copyright Act provides in Chapter 7, Article 53:

Anyone who, in relation to a literary or artistic work, commits an act which infringes the  copyright enjoyed in the work . . . shall, where the act is committed wilfully or with gross negligence, be punished by fines or imprisonment for not more than two years.

How the rest of the Riksdag would react to these maneuvers remains to be seen. Swedish elections are held every 4 years, and the last election was in 2006 (the same year the Pirate Party was established). Sweden heads to the polls again on September 19th, and although a Pirate victory would not cause the collapse of WIPO or world-wide IP anarchy, it would at the very least be a very strange twist in the fight to enforce digital rights.

On June 30, 2010, the U.S. District Court for the Southern District of New York authorized the U.S. Department of Justice (DOJ) and the U.S. Immigration and Customs Enforcement agency (ICE) to seize the domain names of web sites accused of criminal copyright infringement for showing films and television shows without permission (United States v. TVShack.net, S.D.N.Y., No. 10 MAG 1421, warrants unsealed 6/30/10).  The seizures are part of “Operation In Our Sites,” a new initiative that targets illegal films, music, counterfeit pharmaceuticals, software, electronics, games and other products distributed via the Internet that threaten public safety and health.  To that end, the U.S. Attorney for the S.D.N.Y. drew attention to the mass scale infringement over the Internet, which results in billions of dollars in losses to the U.S. economy and real hardships for millions of ordinary working people who are employed by the U.S. motion picture and television industry.

The sites targeted include Movies-Links.tv, TVShack.net, Now-Movies.com, PlanetMoviez.com, FilesPump.com, ZML.com., and ThePirateCity.org, all of which have obtained global popularity.  Instead of linking visitors to infringing first-run movies that are often available online within hours of their theatrical release, these sites now display a seizure notice.  Reportedly, the DOJ will request that the domain names be forfeited.

In its efforts to discourage those who seek to profit from the copyrighted, intellectual property of others, ICE manages the National Intellectual Property Rights Coordination Center, which has united the U.S. government agencies that combat intellectual property theft.  In addition to ICE, the partners include: U.S. Customs and Border Protection; the FBI; the Department of Commerce; the Food and Drug Administration; the Postal Inspection Service; the General Services Administration, Office of the Inspector General; the Naval Criminal Investigative Service; the Defense Criminal Investigative Service; the Army Criminal Investigative Division’s Major Procurement Fraud Unit; and the Government of Mexico’s Tax Administrative Service.

The White House moved to protect what they call an “Identity Ecosystem” through a new cybersecurity initiative. On June 25th, a post on the White House blog called The National Strategy for Trusted Identities in Cyberspace proposed a system developed jointly by the government and private enterprise to simplify the management of online identities. The goal would be to have users’ online reputations vetted by a participating vendor, “vouching” for them across the Internet. For example, if a user is verified through Google or Facebook, she could simply use her login to simplify an Amazon or eBay purchase.

The idea is hardly new. OpenID has been working towards a similar goal for some time, partnering with some of the biggest names on the Internet. Google, Yahoo, Verisign, and WordPress all have incorporated the OpenID interface into their systems, giving users the option to use it along side or in place of their local logins. The Open ID website even has a page welcoming the government, linking to the the draft memo for the government’s program. The primary goals of both systems are being easy to use, cost-efficient, voluntary, and secure. The potential applications for the system include digital transactions, social media conformity, and allowing “anonymous” blogging.

The plan is not without its critics. The Department of Homeland Security set up a website allowing for user-rated commenting on the proposal; the top 5 all present compelling arguments against the system. The DHS comments focus more on the natural risk of centralizing users’ personal information and better informing the public on how to protect their information. However, there has been somewhat less discussion on how a system a system designed to verify one’s identity would preserve anonymity. But, as a few tech blogs have pointed out, it doesn’t. It merely shortens the subpoena’s trip from complainant to records custodian while facially preserving anonymity to the casual reader. But given the public’s indifference towards sharing their identity by using their Facebook accounts to log-in to various sites across the Internet, is it likely to be a concern?

Although a group of businesses and artists who relied on foreign works in the public domain alleged violations of the First Amendment and Copyright Clause of the Constitution, on June 21, 2010, in Golan v. Holder, the 10th Circuit ruled that the Uruguay Round Agreements Act of 1994 (“URAA”) passes constitutional muster and, therefore, the restoration of copyright protection to foreign works that passed into the public domain or never enjoyed U.S. copyright protection is lawful Section 514 of the URAA – the restorative copyright protection clause – was a delayed response to the 1989 U.S. signing of the Berne Convention for the Protection of Literary and Artistic Works of 1886, which states that all signatory states recognize the copyrights granted in other signatory states, and such recognition be applied retroactively to pre-existing foreign works, even if they had been treated as public domain works prior to accession to the treaty.  Prior to Section 514 of the URAA, the U.S. enacted the Berne Convention Implementation Act of 1988, which did not implement the radioactivity principle.

Orchestra conductors, teachers, performers, publishers, archivists, and movie distributors who all relied on the foreign works in the public domain challenged the constitutional validity of the URAA.  In applying an intermediate scrutiny standard, Chief Judge Mary Beck Briscoe held that Section 514 advances important governmental interests and is narrowly tailored such that it restricts speech only to the extent that is necessary to serve those interests.  The governmental interest in restoring copyright protection to foreign works includes complying with an international treaty, securing legal protections for U.S. copyright holders abroad, and remedying past inequities of foreign authors.  To that end, Judge Briscoe referenced the legislative history and noted that Congress heard testimony that the U.S. could expect foreign countries to provide only as much protection to U.S. copyright holders as the U.S. would provide to foreign copyright holders.  It appears that Holder will upset a few in the U.S. who relied on the public domain, but will make many U.S. copyright holders abroad very happy.