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Australian Copyright Reform Considers Fair Use

Australia is currently undergoing a review of its copyright laws, in which introducing the fair use doctrine to Australian law is one of the “headline recommendations.”  After receiving a Terms of Reference in June 2012, the Australian Law Reform Commission (ALRC) released an issues paper in August 2012 on copyright and the digital economy with an invitation for further submissions or comments, which were uploaded on their site in November 2012.  In June 2013, the ALRC published a nearly-400-page discussion paper, again inviting responses, which are available here.  This week, opposition has been getting press, such as recent comments from entertainment industry lobbyists, who alleged that the “fair use proposal would boost litigation.”

The head of the Australian Home Entertainment Distributors Association (AHEDA) claimed that “a regime based on fair use would lead to an increase in piracy and require litigation to be defined,” which “would put pressure on copyright owners to litigate directly against consumers.”  He continued:  “We don’t want to be suing end users. It’s the very last thing we want to do and any policy proposal that says you need to litigate is flawed.”

There is so much wrong with AHEDA’s statement.  First, a regime based on fair use would decrease piracy, as fair uses are not copyright infringement.  Fair use is an unauthorized use of a copyrighted work, but it is a use that is privileged under the law, and many scholars describe it as an affirmative right, not just a defense.  Put simply, fair use is not piracy.  Second, fair use would not necessarily require litigation to be defined, as it can be defined statutorily.  In doing so, Australian lawmakers can look at language from the dozens of countries with fair use and fair dealing provisions in their law, which have been compiled in this handbook from Jonathan Band and Jonathan Gerafi.  When litigation over fair use arises, Australian courts can look to existing case law on fair use and fair dealing.  Thousands of fair use and fair dealing opinions have been published online, as this resource from Jonathan Band and Deborah Goldman demonstrates.  Third, copyright owners will not be pressured to sue their consumers; most US litigation over fair use is brought against businesses (generally rights-holders suing tech startups or Internet businesses with deep pockets).  Additionally, a new copyright regime with fair use should also contemplate Australia’s existing safe harbor provisions.  In the April 2012 Roadshow Films Pty Ltd v iiNet Ltd case, the High Court of Australia was fairly reluctant in its interpretation of existing copyright law, and instead suggested the avenue of legislative change, because “the Parliament is more responsive to pressures for change to accommodate new circumstances than in the past. Those pressures are best resolved by legislative processes rather than by any extreme exercise in statutory interpretation by judicial decisions.”

AHEDA is not the only group who has come out against fair use.  For example, News Corp Australia spends the majority of its submission to the discussion paper attempting (unsuccessfully) to make a case against fair use, despite News Corp subsidiary Fox News having relied on fair use itself in recent litigation.  And an Australian author’s inaccurate allegation that “fair use is ‘theft’” got some press, and was expertly debunked by Mike Masnick on Techdirt.  Fortunately, submissions have also been filed in favor of fair use, such as from the Australian Libraries Copyright Committee and the Australian Digital Alliance and iiNet, among others.  The Australian Digital Alliance has also put together a useful mythbusting site responding to common misconceptions about fair use.

Fair use has been and continues to be key for innovation in the US, a fundamental doctrine that has facilitated the introduction of countless new products and services to the market.  (I put together a primer on fair use, key precedents, and disruptive technologies it’s enabled in this post.)  As the Commerce Department’s recent green paper put it:  “The fair use doctrine, developed by the courts and codified in the 1976 Copyright Act, is a fundamental linchpin of the U.S. copyright system.”  Companies that rely on limitations and exceptions to copyright like fair use make a substantial contribution to the US economy:  In 2008 and 2009, fair use industries generated total revenue averaging $4.6 trillion, and fair use-related industry value averaged $2.4 trillion, approximately 17% of total US GDP.  Investors and venture capitalists are less likely to invest in companies if they face copyright liability due to ambiguous or outdated regulations:  80% of investors and VCs surveyed reporting being uncomfortable investing in business models in which the regulatory framework is ambiguous.  In 2010, UK Prime Minister David Cameron gave a speech calling for a review of UK IP laws, in which he explained that Google’s founders had told the UK government they could not have started their company in Britain due to its laws not being as amenable to innovation as the US:

The service they provide depends on taking a snapshot of all the content on the internet at any one time and they feel our copyright system is not as friendly to this sort of innovation as it is in the United States.

Over there, they have what are called ‘fair-use’ provisions, which some people believe gives companies more breathing space to create new products and services.

So I can announce today that we are reviewing our IP laws, to see if we can make them fit for the internet age. I want to encourage the sort of creative innovation that exists in America.

The Australian Digital Alliance put together a comprehensive site listing many specific examples of how Australian copyright law is “out of touch with the digital world.”  Australia adopting a robust fair use right with flexible limitations and exceptions, like the US has, would do a lot to fix those problems.

Intellectual Property

The Internet enables the free exchange of ideas and content that, in turn, promote creativity, commerce, and innovation. However, a balanced approach to copyright, trademarks, and patents is critical to this creative and entrepreneurial spirit the Internet has fostered. Consequently, it is our belief that the intellectual property system should encourage innovation, while not impeding new business models and open-source developments.