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WASHINGTON, D.C. - (Mealey's) Congress did not exceed its authority in enacting Section 514 of the Uruguay Round Agreements Act (URAA), which extended protection to foreign works that would otherwise fall into the public domain, a divided U.S. Supreme Court ruled Jan. 18 (Lawrence Golan, et al. v. Eric H. Holder Jr., et al., No. 10-545, U.S. Sup.).
(Decision. Document #16-120123-009Z.)
Justice Ruth Bader Ginsburg wrote for the majority that the high court's ruling in Eldred v. Ashcroft (537 U.S. 186 ) is "largely dispositive of petitioners' claim that the [copyright] Clause's confinement of a copyright's lifespan to a 'limited time' prevents the removal of works from the public domain."
"We find scant sense in this argument, for surely a 'limited time' of exclusivity must begin before it may end," Justice Ginsburg wrote.
In 1989, the United States joined the Berne Convention for the Protection of Literary and Artistic Works, requiring each signing country to provide the same copyright protections to authors in other member countries that it provides to its own authors. However, the implementing legislation in the United States did not extend copyrights to foreign works that were already in the public domain in the United States. So in 1994, the United States signed various trade agreements, including one requiring that its signatories comply with Article 18 of the Berne Convention and extend copyright protection to all works of foreign origin whose term of protection had not expired.
To comply with these international agreements, Congress enacted the URAA. Section 514 of the URAA implements Article 18 of the Berne Convention, restoring copyrights in foreign works that were formerly in the public domain in the United States. Section 514 also provides protections for "reliance parties" that had exploited foreign works before their restoration. In 2001, petitioner Lawrence Golan and various other musicians and publishers sued the U.S. attorney general (then John Ashcroft, now respondent Eric H. Holder Jr.) in the U.S. District Court for the District of Colorado, challenging the constitutionality of the Copyright Term Extension Act (CTEA) and Section 514 of the URAA and seeking declaratory and injunctive relief. Judge Lewis T. Babcock granted summary judgment to the government. On appeal, the 10th Circuit U.S. Court of Appeals ruled that the plaintiffs' CTEA claim failed but that their challenge to Section 514 of the URAA was valid. The appellate panel remanded the case for Judge Babcock to assess "whether [Section] 514 is content-based or content-neutral" and to apply the appropriate level of constitutional scrutiny. Judge Babcock granted the plaintiffs' motion for summary judgment, ruling that "to the extent Section 514 suppresses the right of reliance parties to use works they exploited while the works were in the public domain," Section 514 is unconstitutional. The 10th Circuit again reversed, finding that the government met its burden of demonstrating "a substantial interest in protecting American copyright holders' interests abroad" and that Section 514 "is narrowly tailored to advance that interest." Golan filed a petition for certiorari, which was granted in March 2011, leading 24 amici curiae to weigh in.
Oral arguments were held in October.
Siding with the respondent, the majority rejected Golan's claim that absent a reversal of the 10th Circuit, the government could institute perpetual copyright terms. "As in Eldred, the hypothetical legislative misbehavior petitioners posit is far afield from the case before us," Justice Ginsberg wrote, adding that "in aligning the United States with other nations bound by the Berne Convention, and thereby according equitable treatment to once disfavored foreign authors, Congress can hardly be charged with a design to move stealthily toward a regime of perpetual copyrights."
Next, Justice Ginsburg said that "historical practice corroborates" the majority's interpretation of the copyright clause as permissive of "full U.S. compliance with Berne." Congress has previously "seen fit to protect works once freely available" according to Justice Ginsburg, who noted that the Copyright Act of 1790 granted protection to works previously in the public domain, while several other private bills - including the Helmuth and Corson Acts - restored copyright protection. While the statutes were never challenged in court, "analogous patent statutes . . . were upheld in litigation," Justice Ginsburg pointed out.
"Given the authority we hold Congress has, we will not second-guess the political choice Congress made between leaving the public domain untouched and embracing Berne unstintingly," Justice Ginsburg wrote.
Turning to Golan's argument that Section 514 provides no incentive to create new works, in contravention of the Copyright Act's stated goal of promoting the progress of science and useful arts, the majority was similarly not persuaded. In Eldred, the Supreme Court "rejected an argument nearly identical to the one petitioners rehearse," Justice Ginsburg observed, ultimately holding that the copyright clause does not demand that each copyright provision - when "examined discretely" - must "operate to induce new works." Even without the ruling in Eldred, however, the majority deemed Golan's argument unavailing because "nothing in the text of the Copyright Clause confines the 'Progress of Science' exclusively to 'incentives for creation.'"
"Evidence from the founding, moreover, suggests that inducing dissemination - as opposed to creation - was viewed as an appropriate means to promote science. . . . Until 1976, in fact, Congress made 'federal copyright contingent on publication, [thereby] providing incentives not primarily for creation,' but for dissemination," Justice Ginsburg wrote, citing the statement of Professor Shira Perlmutter at URAA Joint Hearing 189.
"A well-functioning international copyright system would likely encourage the dissemination of existing and future works. Full compliance with Berne, Congress had reason to believe, would expand the foreign markets available to U.S. authors and invigorate protection against piracy of U.S. works abroad, thereby benefitting copyright intensive industries stateside and inducing greater investment in the creative process," Justice Ginsburg wrote.
With regard to Section 514 and the First Amendment, the majority found that the latter does not inhibit the restoration authorized by the former. As in Eldred, the Supreme Court found that there is no need for heightened review because "Congress adopted measures to ease the transition from a national scheme to an international copyright regime" by deferring the date from which enforcement runs, and cushioning the impact of restoration on reliance parties.
"Petitioners attempt to distinguish their challenge from the one turned away in Eldred. First Amendment interests of a higher order are at stake here, petitioners say, because they - unlike their counterparts in Eldred - enjoyed 'vested rights' in works that had already entered the public domain. The limited rights they retain under copyright law's 'built-in safeguards' are, in their view, no substitute for the unlimited use they enjoyed before §514's enactment. Nor, petitioners urge, does §514's 'unprecedented' foray into the public domain possess the historical pedigree that supported the term extension at issue in Eldred. However spun, these contentions depend on an argument we considered and rejected above, namely, that the Constitution renders the public domain largely untouchable by Congress," Justice Ginsburg wrote.
In a dissent, Justice Stephen Breyer, joined by Justice Samuel A. Alito Jr., aligned with Golan's position that Section 514 "does not encourage anyone to produce a single new work" and that, by definition, the statute "bestows monetary rewards" only on the owners of "old works."
"At the same time, the statute inhibits the dissemination of those works, foreign works published abroad after 1923, of which there are many millions, including films, works of art, innumerable photographs, and, of course, books - books that (in the absence of the statute) would assume their rightful places in computer-accessible databases, spreading knowledge throughout the world," Justice Breyer wrote.
Calling the "possibility of eliciting new production" an "essential precondition for American copyright protection," Justice Breyer found that Section 514 achieves the exact opposite. The statute "brings about higher prices and costs," Justice Breyer warned, "and in doing so seriously restricts dissemination, particularly to those who need it for scholarly, educational or cultural purposes-- all without providing any new incentive for the production of new material."
As such, "Congress . . . has exceeded what are, under any plausible reading of the Copyright Clause, its permissible limits," Justice Breyer added.
Justice Elena Kagan took no part in the decision.
The petitioners are represented by Anthony T. Falzone of the Stanford Law School Center for Internet & Society in Stanford, Calif. Solicitor General Donald B. Verilli Jr. of the U.S. Department of Justice in Washington represents the government.
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