27 June 2000. Thanks to Mike Godwin.
This report first appeared in the June 22, 2000, issue of E-Commerce Law Weekly. Mike Godwin is senior legal editor for E-Commerce Law Weekly, and a columnist for American Lawyer.
Copyrights--DVDs
Release of depositions of Valenti and Jacobsen show a lot of "I don't know"s.
--By Mike Godwin
Published deposition testimony from top officials at the Motion Picture Association of America in a federal lawsuit strongly suggests that neither they nor others in the movie-industry trade association are aware of any piracy of DVD movies resulting from the publication to the Web late last year of the DeCSS decryption utility.
The DeCSS utility--a piece of software that unscrambles DVD-movie content that has been scrambled by the movie industry's Content Scramble System--potentially allows users to copy content from a legitimate commercial DVD movie to a computer hard-drive, from which it can, at least in theory, be transmitted through the Internet.
MPAA President Jack Valenti and the MPAA vice president in charge of the organization's global antipiracy efforts, Kenneth Jacobsen, were deposed in June as witnesses in what has become the most-watched case of the DVD/DeCSS litigation--Universal City Studios Inc. v. Reimerdes (S.D.N.Y., CA No. 00 Civ. 277 (LAK)). The published deposition transcripts for the case, in which several passages labeled "confidential" are redacted pursuant to a court-approved confidentiality stipulation (2 ECLW 649, 6/8/00), appear to raise questions about the MPAA's claims in current lawsuits that the DeCSS utility is essentially a tool to facilitate copyright infringement.
The transcripts also raise questions as to whether the MPAA was justified in January when it sought in federal court preliminary injunctions against Web publishers who distributed or linked to the DeCSS software utility, or to its source code (2 ECLW 87, 1/25/00).
Irreparable Harm?
In general, movants for a preliminary injunction must show, inter alia, a strong likelihood of irreparable harm if the injunction is not granted. Caselaw in the Second Circuit holds that a preliminary injunction is an "extraordinary" rather than a "routine" remedy and that the movant must show that the injury is likely and imminent rather than remote and speculative. But the depositions suggest that, at the time the organization filed its lawsuits in January, MPAA leadership did not know of a single instance of DeCSS's having been used to pirate a DVD movie.
Moreover, in the months since the filing of the lawsuits, the MPAA's leaders still cannot document a single instance in which DeCSS has been used to make an unauthorized copy of a DVD movie. In addition to Valenti's and Jacobsen's testifying in their respective depositions that they were not aware of, or could not recall, any documented instances of such copying, MPAA Deputy General Counsel Gregory Goeckner acknowledged in a public forum at Yale University in April that he knew of no DeCSS-related piracy (2 ECLW 461, 4/27/00).
The plaintiffs also predicted that the widespread infringement that would follow if the publication of DeCSS were not enjoined might hurt consumers directly--by forcing the movie industry to abandon the DVD format altogether, thus harming movie lovers who have already invested in DVD-playing equipment. But the depositions indicate that top officials of the MPAA never actually researched whether those predicted harms were likely or not.
The deposition of Jacobsen in particular indicates that the MPAA's antipiracy division never investigated whether the infringement threat supposedly posed by DeCSS was real. Instead, the plaintiffs relied almost entirely on the often-incendiary postings of self-styled DVD hackers to prove to the satisfaction of Judge Lewis A. Kaplan that irreparable damage was likely to occur if the injunction were not granted. Whether the postings should have been taken seriously as indicators of current or imminent infringement was not explored at the preliminary injunction hearing, except in passing.
But the MPAA's noninvestigation of any claims that DeCSS facilitates DVD piracy--a fact that surfaces more than once in the Jacobsen deposition--calls into question whether the trade association itself took seriously the supposed threat of DeCSS. Some legal experts speculate that the movie industry was more interested in creating test cases with unsympathetic defendants than it was in tracking down whatever DeCSS-related DVD piracy might be occurring.
What would a possible motive be for such test cases? In the New York federal case for which Valenti and Jacobsen were deposed, the goal may be to ensure that the Digital Millennium Copyright Act's anticircumvention provisions are interpreted by courts as barring the use or dissemination of tools like DeCSS, regardless of whether the ultimate goal is copyright infringement. On their face the anticircumvention provisions seem to do just that, and Judge Kaplan interpreted the provisions that way in the January hearing.
In a concurrent, related state-court case in California--DVD Copy Control Association v. McLaughlin (Super Ct. Calif., No. CV-786804, filed and argued 12/29/99) (2 ECLW 1, 1/4/00) the legal theory invoked to bar dissemination of DeCSS is based on state trade-secret law. One of the interesting sidelights that emerged in the deposition is that the movie industry companies and their allies apparently held a meeting in December to plan or coordinate the nearly simultaneous cases, even though the legal theories in the California state case are wholly different from those in the East Coast federal case. Although the two cases are nominally separate, there is also a hint in one deposition that the plaintiffs in the two cases--the DVD Copy Control Association in the California case, and the MPAA member organizations in the East Coast federal cases--shared lists of purported disseminators of, or linkers to, the DeCSS utility.
Preliminary Injunctions a Deterrent?
Supporters of the plaintiffs' case might suggest that the lack of documentable instances of DeCSS piracy signifies the deterrent effectiveness of the preliminary injunctions the MPAA successfully sought in January. However, Jacobsen testified in his deposition that only "roughly 60 percent" of the 600 to 1000 websites worldwide that offer or link to DeCSS have removed the program or the links. Kaplan said in his memorandum opinion in support of the preliminary injunction that the movie companies had shown that continued publication of DeCSS truly posed a threat of "immediate and irreparable injury." But the depositions reveal no instances of DeCSS-related piracy, even though 240 to 400 websites are still making the utility available, one way or another.
The named defendants in the DVD cases say the DeCSS program is designed not to promote infringement but to allow users to play--albeit on platforms not approved by the movie industry--the DVD movies they have legitimately purchased. Jacobsen and Valenti each classified any such use of DeCSS as piracy, however.
What Valenti Can't Recall
MPAA chief Valenti has been outspoken during the past two years on the issue of piracy of digital content--issuing press releases, testifying before Congress, and giving interviews, he has insisted that the Internet and digital copying pose a profound threat to copyright holders. In subcommittee testimony last October he told U.S. Representatives that digital piracy on the Internet is vastly more threatening than its analog counterpart--"The thousandth copy of a digitized movie is as pure as the original, whereas in analog each copy is degraded in quality," he said in that hearing.
But in deposition Valenti, when asked by the defendants' counsel whether he knew "anything about the quality of a film that has been de-encrypted [sic] through DeCSS," answered with a blunt "No." He gave the same answer when asked whether anyone had ever shown him a film that had been decrypted with DeCSS.
In his congressional testimony last fall, Valenti said that then-current or soon-to-open movies such as Stigmata and Toy Story 2 were downloadable or purchasable on the Internet. But in his deposition he said he did not know of any instances in which movies were available on the Internet before DVDs or videos of the film were legally commercially available to the public. Valenti also testified in his deposition that he did not know if any of the estimated annual losses attributable to copyright piracy were attributable to DeCSS.
In the same hearing last October, Valenti said that "with the increased availability of broadband Internet access you can bring down a full-length motion picture in less than 15 minutes versus the four to five hours for non-broadband." But when asked in deposition whether he knew of any MPAA research or independent reports that Internet movie piracy could be conducted so quickly, Valenti disclaimed any such knowledge.
Valenti was asked numerous questions that centered on whether he knew of any connection between DeCSS and movie piracy. Other questions concerned what Valenti's views as to the scope and application of the DMCA's anticircumvention provisions might be. In nearly 100 instances, Valenti responded with "I don't know," "I don't recall," or "I'm not aware."
Concern about the bad publicity that might arise if the MPAA chief's inability to answer these questions was publicized was one of the reasons the plaintiffs sought earlier this month to block press access to the deposition transcripts. Only hours after Valenti's deposition was completed in Washington, the parties' lawyers were back in court in New York to argue over plaintiffs' request for a blanket protective order barring pre-trial disclosure of the deposition testimony. The request for a blanket order was denied, but Kaplan did outline certain narrow classes of deposition material that were eligible for redaction under the parties' pre-existing confidentiality stipulation. These included personal identifying information about some witnesses and some MPAA employees, and trade-secret or security-related information (2 ECLW 649, 6/8/00).
Valenti responded to seven separate questions as to his knowledge about the extent and types of movie piracy on the Internet with "I don't recall" or "I don't know." Nevertheless, only two weeks after giving his deposition, Valenti commented with apparent knowledgeability on the same subject in a June 21 New York Times Op-Ed piece. Valenti wrote in the Times article: "A number of new movies, the ones now in theaters, have already been put on the Internet by pilfering zealots eager to enfold films in the same embrace now choking the music world, even though few computer users yet have ways to download them."
Redactions and Objections
In all, about 35 pages of Valenti's 131-page deposition were redacted--more than 25 percent of his total testimony--pursuant to the confidentiality stipulation approved and later modified by Kaplan. While some of the redacted testimony, to judge from the questions leading up to or following it, had to do with such issues as piracy investigations, in other instances lawyers for plaintiffs seemed eager to block witnesses' testifying as to their beliefs about the meaning of the Digital Millennium Copyright Act and as to the details of "region coding" DVDs so that movies sold in one part of the world won't play in other markets. Critics of the DVD litigation have argued that it is concern about the "region coding" scheme, which is designed to maximize a movie's revenues by enabling movie companies to release them serially around the world, and not concern about piracy, that has led plaintiffs to go on the offensive against DeCSS distributors. DeCSS-enabled DVD software has the potential to allow users to ignore region coding, so that, for example, an American could buy a DVD movie region-coded for Europe (perhaps by ordering it online) and play it on his American-region-coded DVD player or computer. About 10 straight pages of Valenti's deposition testimony was redacted after the place where Martin Garbus, attorney for defendants, asked him about the relationship between region coding and DVD encryption.
Plaintiffs' counsel frequently objected during the depositions that defendants' counsel's questions about the scope and meaning of the Digital Millennium Copyright Act called for "legal conclusion(s)." Kaplan indicated during the protective-order hearing June 6 that he disapproved of such questions, if that is what their purpose was. But over the course of the two depositions the pattern of defendants' questions seemed to indicate a different intention--determining whether the leadership of the MPAA has resolved to honor "fair use" in principle, but in practice to classify it as "illegal" and "piracy." In response to questions about his view of fair use, Jacobsen said only that an unlicensed copying is "fair use" if a court has said it is, and would not specify what he thought might qualify as "fair use" from his perspective as an antipiracy strategist. But Jacobsen was willing to say on more than one occasion during the deposition that he categorically defined any unauthorized accessing of digital content as infringement or piracy. He also stated his view that even posting DeCSS by itself, or linking to it, was piracy.
Valenti was more willing to speak positively about "fair use," but only in the abstract. He insisted that "fair use" doctrine has not been altered by the DMCA, yet he also said he believes that "any time you circumvent encryption according to the DMCA you're violating the law."
The defense lawyers' questions also seemed designed to discover whether the MPAA has as a matter of policy set out to promote (through litigation as well as public statements) a particular interpretation of the DMCA's anticircumvention provisions, the passage of which Valenti lobbied for in 1998. Defendants' lawyers' questions seemed aimed at determining whether the MPAA leadership truly accept "fair use," under which some kinds of unlicensed copying of copyrighted works is legal.
"Fair use" is not a specified defense under the anticircumvention provisions of the Digital Millennium Copyright Act, although it remains an affirmative defense under the infringement provisions of the Copyright Act, to which the DMCA is an extended amendment. A central question of the New York DVD litigation is whether the anticircumvention provisions operate wholly independently of the longstanding fair-use provisions of the Copyright Act, or whether they are subject to "fair use" doctrine just as the infringement provisions are.
"The movie industry doesn't seek to eliminate the Fair Use Doctrine," Valenti has stated publicly, but critics of the litigation, and of the DMCA, say that anticircumvention provisions may have precisely that effect if they are interpreted the way Valenti and Jacobsen interpret them. In the preliminary-injunction hearing in January, Kaplan also interpreted the anticircumvention provisions as exempt from the "fair use" defenses laid out in the primary body of the Copyright Act.
University of Miami law professor Michael Froomkin has said of Kaplan's interpretation that Kaplan's "literal reading of the statute may be correct, but it doesn't make a lot of sense" in terms of the purported policy goals of the DMCA. Several other law professors have openly criticized the DMCA's anticircumvention provisions because a literal interpretation of the provisions makes it possible for content industries to eliminate even the possibility of legal fair use by encapsulating their products in access-control or content-management technologies. Under this view of the DMCA--which also seems to be Valenti's and Jacobsen's view in their depositions--sidestepping access-control or content-management technologies is an offense even if the sidestepper has a colorable right to read or otherwise enjoy the content in question.
Jacobsen's Revelations
Valenti's deposition received a great deal of media focus, given the star power of the witness. But it was Jacobsen's deposition that said the most about how little research the MPAA had done about the possible impact of DeCSS on piracy before seeking a preliminary injunction in Kaplan's court, arguing that the injunction was necessary to prevent likely immediate, irreparable harm:
Garbus: Can you tell me whether or not the MPAA has determined the name of any one person who has copied a DVD using DeCSS?"Jacobsen: I think it would be fair to say that I would be--that I have no conclusive evidence that any one person has done that.
* * *
Garbus: Did you determine whether any of the people you had sent the cease and desist letters to had actually copied a DVD using DeCSS?
Jacobsen: I have no actual knowledge that anybody has actually copied a DVD using DeCSS. As I said, I have read at least one newspaper article where a reporter claimed to do so.
* * *
Garbus: At the MPAA, did you ask anybody or did the MPAA run any tests about the use of DeCSS?
Jacobsen: Not that I am aware of.
Garbus: Did the MPAA ever hire anybody to perform any tests to see the efficacy of DeCSS in descrambling DVDs?
Jacobsen: Not that I am aware of.
* * *
Garbus: To your knowledge, has a descrambled DVD ever been shown on the Internet? One that has been descrambled through DeCSS.
Jacobsen: I don't know of--I have no specific knowledge of that occurring.
* * *
Garbus: To your knowledge, has anyone ever tried to send a descrambled DVD, one that has been descrambled through DeCSS, on a T1 line [a high-bandwidth Internet connection]?
Jacobsen: I have no knowledge.
* * *
Garbus: With respect to seeing a DVD descrambled through DeCSS on the Internet, do you know whether anyone at the movie studios or the MPAA has tried to send such a DVD over the Internet?
Jacobsen: I do not.
* * *
Garbus: Can you just tell me approximately, in round numbers, the dollar value of the resources that the MPAA has used to determine whether or not DeCSS is an effective descrambling tool for DVDs?
Jacobsen: I'm not aware of any money we have spent to test whether or not it effectively descrambles.
Jacobsen also said he knew of no research, either by the MPAA or by movie companies or other parties, studying the likely economic impact of DeCSS on DVD movie piracy, or determining the quality of copies made through the use of DeCSS.
Jacobsen also denied that MPAA has adopted as a policy any particular view of whether the use of DeCSS in a noninfringing context should be interpreted as a violation of the DMCA. But the MPAA website suggests otherwise. In a page devoted to frequently asked questions about the DVD litigation, the MPAA publishes this question and answer:
Q. Have the defendants actually used DeCSS to make illegal copies?A. It is irrelevant whether or not the defendants were personally engaged in making illegal copies. They are clearly "providing the keys to the castle," which is in violation of the anti-circumvention provisions of the federal copyright law.
As a purely legal matter, much and perhaps most of the deposition testimony released to the public would be inadmissible in a trial. And even if, say, the MPAA's lack of documentation of DeCSS-related infringement is admissible, that may not help defendants legally, since the DMCA may make DeCSS distribution illegal regardless of what it is used for (or whether it is used at all).
But in the public-relations war the movie companies have been conducting against the defendants since the DeCSS utility was released to the world last fall--a war that has been escalating since the DVD cases were initiated early this year--defendants seem to have won their first two significant victories. The first victory, courtwatchers say, was in getting the depositions out into the open. But the second, and more important victory, may be in the defendants' showing the public how much of the movie companies' warnings, dire predictions, and accusations seem to be based more on fear than on fact.
[Editor's note: Mike Godwin argued pro se for media access to the depositions in the case discussed in this article. Godwin's motion was made on his own behalf, and his argument and motion do not necessarily represent the views of American Lawyer Media, the publisher of E-Commerce Law Weekly.]