Draconian DMCA

IN SPITE OF the many controversies surrounding the DMCA (Digital Millennium Copyright Act), its defenders continue to insist it works the way Congress intended. But let's take a look at the effect it's actually having day-to-day in the real world.

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One thing Congress clearly intended the DMCA to do was to offer some protection for Internet service providers from being held responsible for any infringements made by their users. In a story similar to many heard on The Gripe Line, a small ISP recently got a painful lesson in how the DMCA really works. "One of our Web-hosted customers, a Web site that indulges in parodies of other Web sites, parodied another Web site that took exception," the owner of the ISP wrote. "The other Web site, rather than first contact our customer or, as a fallback contact us concerning the issue, instead invoked the DMCA against both my customer, our company, and the upstream provider of our bandwidth."

Under the DMCA's "no liability for taking down" rules, ISPs aren't responsible for policing their customers' content for infringing behavior, but they are required to respond quickly when a copyright holder claims its rights are being violated. Unfortunately, when his upstream ISP called, the small ISP's owner and his staff were all out on service calls. To protect itself under DMCA rules, the upstream provider had no choice but to take down the whole server, meaning that some 30 other totally innocent customers also lost their service. During the next 24 hours, both the ISP and the parody Web site had to wrestle with the DMCA's complex protest mechanism before finally getting all their service restored.

What I found remarkable about this case was that the copyright holder was not one of the game console or media giants that issue DMCA takedown orders on a daily basis, but a small soft-core porn Web site. That such an entity could -- without legal resources and on the basis of a very dubious claim of copyright infringement -- pull the plug on his customers taught the ISP owner a sad lesson.

"I was flabbergasted," the ISP owner wrote. "What happened to probable cause? A warrant? A court injunction? It was like living in the old Soviet Union or Nazi Germany. They basically busted my door down, shot everyone on site, left, and then left a note, 'Hey sorry if this was the wrong house but the law is the law' ... Now that I have been the recipient of a DMCA takedown I have all the procedures ready and my upstream ISP has my personal cell phone number just for reaching me. According to them, they have [had] to do this all the time the last few years. Under the DMCA they must act precipitously and with no care for First Amendment rights or whether the charge is right or wrong."

Another area where the DMCA requires precipitous action is in online auctions. eBay and other online auction sites have long had procedures in place for quickly removing any auction where a copyright holder suspects illegal copies of its works are being sold. Recently, however, I've seen several cases where software publishers have ordered auctions closed without any suggestion that the software was actually pirated.

A reader reports he recently found an unused copy of a 10-year-old version of Novell NetWare and decided to put it up for auction on eBay. "It would only bring at best $50, but if someone needed it, I'd be doing them a favor since Novell doesn't sell it anymore. After I listed it, Novell ended my auction because they don't allow their licenses to be transferred, which is incredibly customer-unfriendly from a company such as Novell."

By way of explanation, Novell sent the reader a Web page with an extended FAQ about its restrictions against license transfers. "Novell's software licenses may not be transferred or assigned without the prior written approval of Novell," Novell's page on eBay states. "If eBay has removed your auction, Novell will not consider giving the written permission necessary to transfer the license."

As straightforward as that policy appears on the Web, Novell anti-piracy officials nonetheless seemed very reluctant to confirm to me that they request auction terminations on that basis. All auctions are evaluated case by case, they said, so other factors might be involved besides the license restriction against transfers.

I can't say I'm surprised by Novell's response, though, because it's pretty much the same thing I've heard from other software publishers in similar circumstances. They'll tell the person auctioning their software that their license agreement forbids resale, but they won't confirm the policy to me. Why is that?

I suspect it's because of a principle in copyright law called the "First Sale" doctrine, which says basically that you have the right to sell, loan, or give away a legally acquired copy of a copyrighted work. It's a pretty important concept too -- libraries and used bookstores owe their existence to it. Software publishers like to pretend First Sale doesn't apply to them because their products "are licensed, not sold" but there's many legal precedents against that view. There's even one rather well-known case where the First Sale doctrine was applied to Novell specifically.

So what we do have here? Software companies are using this new copyright law primarily to circumvent a fundamental principle of established copyright law. Is that how Congress intended the DMCA to be used? And did it intend that small ISPs should have to hire lawyers or become lawyers themselves in order to protect themselves and their customers from arbitrary takedowns? I hope not, but that's the way the DMCA works in the real world.