>>The Tenth Circuit Discovers Copyright’s Lost Ark: Section 106(3) Encompasses a ‘Making Available’ Right

The Tenth Circuit Discovers Copyright’s Lost Ark: Section 106(3) Encompasses a ‘Making Available’ Right

Prof. Peter S. Menell, Koret Professor of Law and Director,
Berkeley Center for Law & Technology,
University of California at Berkeley School of Law (Boalt Hall)
January 13, 2014

As I explored in a 2010 commentary1 and 2011 article,2 copyright enforcement actions against file-sharers brought the scope of the Copyright Act’s Section106(3) “distribution right” to center stage.  Advocates for alleged file-sharers urged courts to impose upon copyright owners a requirement to prove that a third person downloaded the digital file in order for the uploader to be liable for copyright infringement.  The trial judge in Capitol Records, Inc. v. Thomas ordered a retrial of the first major file-sharing verdict on the grounds that his original jury instructions failed to explain that actual dissemination of copyrighted sound recordings, rather than merely making them available for dissemination through an online peer-to-peer file sharing application, was required to establish “distribution” within meaning of the Copyright Act.3  Given the architecture of the Internet and privacy concerns, such proof could substantially raise the cost of pursuing such enforcement actions.

Prior to the emergence of file-sharing technology, the distribution right was rarely enforced.  Most copyright infringement actions were premised on violations of the reproduction right.  The two appellate cases invoking the distribution right involved arcane scenarios – an Eighth Circuit case involving whether the Copyright Act preempts a state law breach-of-contract claim in which the distribution right was implicated only tangentially and ambiguously,4 and a Fourth Circuit case involving a copy available through a public library.5  The former case concluded without much analysis that “infringement of the distribution right requires an actual dissemination of either copies or phonorecords.”  The latter case reached the opposite result, reasoning that

[w]hen a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public.  At that point, members of the public can visit the library and use the work.  Were this not to be considered distribution within the meaning of § 106(3) [and were further evidence required that a patron actually checked out the subject work], a copyright holder would be prejudiced by a library that does not keep records of public use, and the library would unjustly profit by its own omission.6

Neither court examined the legislative history of the Copyright Act.

From the passage of the first federal copyright law in 1790 through the 1909 Act that governed until 1978, copyright law recognized the “twofold right to make and to publish copies” as the “historic basis of copyright.”7  Had the 1976 Act retained the “right to publish” terminology, it is unlikely that the “making available” question would ever have arisen because the act of publication entails no requirement of receipt of a copyrighted work by a third person.  Merely making a copyrighted work available to the public without authorization would violate the right to publish.

As my research into this question would reveal, the shift in wording from a “right to publish” to a “right to distribute” in the 1976 Act was the result of an arcane, but entirely understandable, jurisprudential twist that unfortunately was submerged in the 1976 Act’s turgid history.  The change in terminology was motivated not by an intention to narrow the historic publication right but rather out of concern for the confusing jurisprudence surrounding investive and divestive publication.8  The specific legislative history confirmed that the drafters intended to broaden the right beyond the historic publication right “to avoid any questions as to whether ‘publish’ or ‘vend’ is used in such a narrow sense that there might be forms of distribution not covered.”9  There is no indication that Congress intended to impose an actual receipt requirement.  To the contrary, the general legislative history reveals that Congress drafted the Copyright Act’s exclusive rights in broad terms so that authors’ rights would not lose their value because of “unforeseen technical advances” “10, 20 or 50 years” into the future.10

Other developments – such as the Sound Recording Amendments Act’s definition of “distribution to the public” to mean “any act by which duplicates of a phonogram are offered, directly or indirectly, to the general public or any section thereof” as well as the Geneva Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms11 – confirm this intention.

Judicial clarification of the scope of the distribution right appeared likely as the two major file-sharing trials – Capitol Records, Inc. v. Thomas and Sony BMG Music Entertainment v. Tenenbaum – wended their way to the appellate courts.  Yet the appellate decisions did not ultimately reach this question.  Nonetheless, the scope of the distribution right remains salient.

Just last month, the Tenth Circuit was the first to confront the scope of the distribution right since this legislative history research has come to light.12  Paralleling the Fourth Circuit’s public library scenario in Hotaling v. Church of Latter-Day Saints, Andrew Diversey sued the University of New Mexico for reproducing copies of his dissertation and making two copies available through its library without his consent.  The circumstances were unusual in that Diversey appears to have been motivated primarily by a desire to protest the Linguistics Department’s failure to provide adequate mentoring or to review the final draft of his dissertation.  Following unsatisfactory responses from university administrators, Diversey filed a copyright action alleging violations of the reproduction right and the distribution right.  The district court dismissed the claims on the ground that Diversey failed to file his complaint within the Copyright Act’s three-year statute of limitations.

On appeal, the Tenth Circuit affirmed the dismissal of the reproduction-right claim but reversed with respect to the distribution-right claim because those acts allegedly occurred within the three-year limitation period.  Regarding the scope of the distribution right, the court explained that

§ 106(3) explicitly protects the copyright owner’s exclusive right to distribute copies by lending.  See Hotaling, 118 F.3d at 203 (“When a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public.”); 2 Melville Nimmer & David Nimmer, Nimmer on Copyright § 8.11[B][4][d] at 8–154.10 (2013) (“No consummated act of actual distribution need be demonstrated … to implicate the copyright owner’s distribution right.”)….  The essence of distribution in the library lending context is the work’s availability “to the borrowing or browsing public.”  See Hotaling, 118 F.3d at 203.13

Analogizing to the file-sharing cases, the University of New Mexico argued that

merely listing the work in the libraries’ catalog information system does not violate Diversey’s distribution right.  They say Diversey must (but has failed to) allege the libraries actually distributed an unauthorized copy to a member of the public.  They cite Atlantic Recording Corp. v. Howell, 554 F. Supp. 2d 976 (D. Ariz. 2008) to suggest “‘§ 106(3) is not violated unless the defendant has actually distributed an unauthorized copy of the work to a member of the public.’”  (Appellee’s Br. 14 (quoting Howell, 554 F. Supp. 2d at 983).)

Howell does reflect some dissensus, particularly among district courts, about the applicability of Hotaling’s holding to cases of Internet file-sharing.  We need not delve into the file-sharing issue today.  Hotaling, like this case, involves a public library making “the work available to the borrowing or browsing public.”  Hotaling, 118 F.3d at 203.  A patron could “visit the library and use the work.”  See id.  This is the essence of a violation of the copyright owner’s exclusive right to distribute his work via lending.  See 17 U.S.C. §106(3); Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 539, 552, 105 S. Ct. 2218, 85 L.Ed.2d 588 (1985) (noting §106(3) gives the copyright owner “the right to control the first public distribution … of his work” (quotation omitted)); Peter S. Menell, In Search of Copyright’s Lost Ark: Interpreting the Right to Distribute in the Internet Age, 59 J. Copyright Soc’y U.S.A. 1, 52–66 (2011) (analyzing the legislative history regarding the distribution right and concluding the requirement of actual distribution of an unauthorized copy is unwarranted).14

Thus, the Diversey case squarely holds that making a copyrighted work available to the public without authorization violates Section 106(3) of the Copyright Act.  Hence, no proof of actual receipt by the public is required.  Although the Diversey case did not involve Internet file-sharing, its invocation of the legislative history underlying the distribution right would apply equally to file-sharing cases.  Furthermore, the court’s conception of “lending” a copy also supports a broad understanding of the distribution right.  Time will tell whether other courts follow this path, but the Tenth Circuit has clearly brought the rich legislative history contained in Copyright’s lost ark into jurisprudence.

The “making available” issue will soon get attention in another important institution.  The House Judiciary Committee will hold hearings on the “Scope of Copyright Protection” on Jan. 14, 2014.15  David Nimmer, with whom I collaborated on the sections in Nimmer on Copyright pertaining to the distribution right,16 will be one of the panelists.  David’s testimony emphasizes the policy arguments in favor of confirming the making available right.17  In my view, Congress should go beyond merely confirming the “making available” interpretation and update copyright’s enforcement regime in light of the dramatic changes brought about by the Internet age.  The statutory damages regime is woefully out of date and kilter,18 which may explain courts’ reluctance to follow Congress’s lead.19  Relatedly, Congress should consider developing a small-claims process for dealing with small-scale file-sharing enforcement.  It would be a mistake, however, for Congress to impose artificial requirements (such as evidence that files placed in publicly accessible networks are actually downloaded) to vindicate copyright owners’ core protections.

By |2018-07-04T13:35:09+00:00January 13th, 2014|Intellectual Property Issues|Comments Off on The Tenth Circuit Discovers Copyright’s Lost Ark: Section 106(3) Encompasses a ‘Making Available’ Right