Inside the Lobbyists NAFTA Copyright Demands: The MPAA

We’ve been reading through some of the demands made by various corporate organizations. Today, we thought we’d look at another submission: the MPAA.

We’ve been covering some of the demands major corporate lobbyists have been making when it comes to the NAFTA (North American Free Trade Agreement) agreement. Previously, we covered the demands made by the Copyright Alliance who demanded an increase to copyright term lengths, the ratcheting up of anti-circumvention laws, ISP involvement on what flows through their networks, and a crackdown on copyright exceptions.

Later, we took a look at what the RIAA (Recording Industry Association of America) had to say. In their submission, they made similar demands, but took things a step further and wanted liability for anyone who even touches the Internet. This includes ISPs, payment services, advertising networks, and search engines. Essentially, it is the practical dismantling of the Internet. Another demand they lobbed against Canada is the dismantling of the successful, though problematic notice-and-notice system. Instead, they want it to be replaced with the American model known as the notice-and-takedown. After over a decade, the system has caused far more problems then it solved and by all measures, have proven to be an abject failure. Nevertheless, the RIAA is pushing to replace a somewhat broken system with a categorically broken one.

If you notice, there are similarities between the Copyright Alliance and the RIAA. One example is the ratcheting up of copyright laws and the crackdown on digital rights. If you are wondering why that is, the RIAA is a member of the Copyright Alliance. This allows the same people to make the same argument as two entities when, really, it is just one entity making the same arguments. The purpose, of course, is to increase the numbers and make it sound like there are more organizations interested in the same thing when it’s just the same executives calling for the same thing. Some might refer to this particular case as astroturfing based on how the Copyright Alliance presented itself.

So, we wanted to see what another similar organization has to say should be in the NAFTA agreement. This is the Motion Picture Association of America (MPAA). Keep in mind that the MPAA is also a member of the Copyright Alliance, so going into this, we are expecting similar demands to be made.

The MPAA Demands

The MPAA’s submission can be read here (PDF), so if there are any questions about the authenticity of my excerpts, you can easily refer back to the source yourself.

In this case, we see a bit of a preface to the MPAA’s demands. One point stood out for us which is seen with the following:

Perhaps the most notable development since NAFTA’s entry into force is the prominence of the digital marketplace. MPAA members have taken full advantage of the opportunities created by the growth and build-out of digital trade and this is reflected in our services trade surplus ($1.35 billion) with both countries. However, the potential of this critical marketplace has been restrained by the rampant theft of creative content online: almost one-quarter of global internet bandwidth is dedicated to copyright infringement. NAFTA, in its current form, is not equipped to effectively tackle the challenges of today’s online marketplace nor harness the opportunities.

If you have any experience being in an academic environment, one thing will likely jump out at you: the lack of citation. Usually, grand sweeping claims like this have some sort of annotation or something to explain why the claim of “almost one-quarter of global internet bandwidth is dedicated to copyright infringement”. If there is no annotation or reference, at the very least, I would have expected a phrase along the lines of “explained later in the submission”. Unfortunately, no such comment is found here, so as a result, this is ultimately an unsubstantiated claim from the get-go. We aren’t even getting into the logistics of how such a figure can come about here.

When talking about Mexico and Canada specifically, the MPAA did focus largely on removing cultural regulations. While we are less familiar with the cultural situation in Mexico, in Canada, there are regulations that stipulate that a certain percentage of content that airs be Canadian made. These regulations prevent foreign interests from pretty much mowing down any hint of Canadian culture by flooding the market with American made content. Already, this is a major problem in Canada and the MPAA wants to cut down on these regulations which will likely worsen the problem in Canada.

From there, the MPAA makes the following claim:

Copyright is the lifeblood of the U.S. motion picture and television industry.

This is probably news to a number of observers out there. What about the consumers who pay for the content? What about the people who make the content in the first place? Apparently, that isn’t the lifeblood of the industry. Instead, it’s copyright laws in their eyes. For some, this may seem like a bit of a disconnect to the situation that is currently playing out in the US.

Another big claim the MPAA makes is this:

The U.S. Department of Justice (DOJ) and U.S. courts have also assessed the impact of online piracy in particular cases on the U.S. motion picture and television industry. In July 2016, the DOJ arrested and charged the owner of Kickass Torrents, an illegal file-sharing website, for distributing over $1 billion of copyrighted materials. And, in January 2012, the DOJ charged the operators of with “running an international organized criminal enterprise allegedly responsible for massive worldwide online piracy of numerous types of copyrighted works, through and other related sites, generating more than $175 million in criminal proceeds and causing more than half a billion dollars in harm to copyright owners.”

As far as MegaUpload is concerned, you may notice the fact that this claim is focused primarily on the opinion of the US DOJ and not the court opinion. Why is this? This is because the MegaUpload case is still ongoing to this day. So, in some respects, it is a bit of a misleading commentary of the situation.

From here, the MPAA also makes this commentary:

The one KORUS provision that the MPAA would oppose incorporating into a modernized NAFTA is a rote recitation of Section 512 of the U.S. Digital Millennium Copyright Act (DMCA). Section 512 reflects an intent to foster a system of shared responsibility between copyright owners and service providers to deal with the problem of widespread infringement occurring over the internet. In a number of important areas that delineate this shared responsibility, however, the courts have strayed from the intent of the language and the overall purposes underlying section 512, to the detriment of content holders. Moreover, we have in recent years seen other countries more effectively and nimbly respond to online piracy in their markets through site blocking, notice-and-stay-down, and injunctive relief. As such, we recommend a new approach to this important trade policy provision by moving to high-level language that establishes intermediary liability and appropriate limitations on liability. This would be fully consistent with U.S. law and avoid the same misinterpretations by policymakers and courts overseas. In so doing, a modernized NAFTA would be consistent with Trade Promotion Authority’s negotiating objective of “ensuring that standards of protection and enforcement keep pace with technological developments.”

In this paragraph, the MPAA is trying to suggest that censorship, notice-and-stay-down, and injunctive relief without actually explicitly stating that any one idea is the necessary way to go in their view. We’re not entirely sure what specifically is meant by the injunctive relief, but we can delve into the first two items.

Notice-and-stay-down is a concept that if a notice is made over a particular post, then any posts made with similar content will somehow magically automatically get taken down. This has proven to be one of those theories that sounds good on paper, but is an absolute disaster when put into practice. The Electronic Frontier Foundation (EFF) made a good post last year about why this is a bad practice:

A few powerful lobbyists want copyright law to require platforms that host third-party content to employ copyright bots, and require them to be stricter about what they take down. Big content companies call this nebulous proposal “notice-and-stay-down,” but it would really keep all users down, not just alleged infringers. In the process, it could give major content platforms like YouTube and Facebook an unfair advantage over competitors and startups (as if they needed any more advantages). “Notice-and-stay-down” is really “filter-everything.”

safe harbors are essential to the way the Internet works. If the law didn’t provide a way for web platforms to achieve safe harbor status, services like YouTube, Facebook, and Wikipedia could never have been created in the first place: the potential liability for copyright infringement would be too high. Section 512 provides a route to safe harbor status that most companies that use user-generated content can reasonably comply with.

A filter-everything approach would change that. The safe harbor provisions let Internet companies focus their efforts on creating great services rather than spend their time snooping their users’ uploads. Filter-everything would effectively shift the burden of policing copyright infringement to the platforms themselves, undermining the purpose of the safe harbor in the first place.

That approach would dramatically shrink the playing field for new companies in the user-generated content space. Remember that the criticisms of YouTube as a haven for infringement existed well before Google acquired it. The financial motivators for developing a copyright bot were certainly in place pre-Google too. Still, it took the programming power of the world’s largest technology company to create Content ID. What about the next YouTube, the next Facebook, or the next SoundCloud? Under filter-everything, there might not be a next.

In short, notice-and-stay-down, in practice, will hamper innovation and Internet development. Only the players that can afford developing very complex filtering mechanisms will be allowed to survive. If a new innovative platform is invented, it would likely never be created because of the burdens placed on them by corporate interests from the entertainment world.

Furthermore, the Internet censorship regimes proposed by the MPAA have proven to be a catastrophic failure everywhere it has been implemented. In the US, back in 2011 and onward, the Stop Online Piracy Act (SOPA) ran into major political hurdles that stopped it dead in its tracks. SOPA would allow for the censorship of websites as the corporate interests saw fit. Already, censorship schemes from other countries ran into major issues with blacklists leaking online and online services that allow users to evade the censors. We even posted about 8 ways to defeat online censorship back then as well. In short, online censorship harms democracy and is completely unworkable.

The MPAA goes even further:

MPAA believes that a modernized NAFTA should build upon what was achieved in KORUS by harvesting discreet provisions from other negotiations and incorporating new disciplines to tackle online content theft. For example, subsequent trade negotiations have included a provision requiring aiding and abetting liability for all criminal copyright offenses. NAFTA could be modernized by ensuring that rightsholders have fully effective injunctive relief, as provided by Rule 65 of the U.S. Code of Civil Procedures.

As we pointed out in our analysis of the RIAAs demands, applying copyright infringement on others that may have “assisted” in some way is very loose language. It allows for corporate control of innovation by preventing innovative software from coming into fruition because it could be used for infringing activities. The MPAA changed the wording to say “aiding and abetting” instead, but the meaning is largely the same.

From there, the MPAA then singled out Mexico for not shutting down websites they don’t like and not applying criminal sanctions for the circumvention of a DRM. They further say:

Currently in Mexico criminal sanctions for commercial scale infringement are only available if the infringement is for profit. This has hampered enforcement against the above-discussed camcording problem but also against online infringement, such as peer-to-peer piracy, that may be on a scale that is immensely harmful to U.S. rightsholders but nonetheless occur without profit by the infringer. The modernized NAFTA like other U.S. bilateral free trade agreements must provide for criminal sanctions against commercial scale infringements without proof of profit motive.

In short, they want criminal sanctions placed on those who are accused of non-commercial infringement. This includes being in a filesharing environment. This, obviously, is a very extreme demand because it goes beyond the demands of applying statutory damages. Criminal liability insinuates jail time. Demanding jail time for a teenager downloading a Justin Bieber album is so incredibly over the top, that it won’t likely pass the laugh test for most people. As it stands with statutory damages, most reasonable people would find it outrageous that anyone can be fined tens of thousands of dollars for downloading a single track. These demands go even further into the absurd. It should be noted that the MPAA also calls for statutory damages as well:

A modernized NAFTA should include a provision requiring deterrent-level statutory damages – a staple of U.S. free trade agreements since NAFTA. Although the U.S. Copyright Act has always provided for statutory damages, this provision is lacking in Mexico. Statutory damages compensate copyright holders for infringement when actual damages are difficult or impossible to calculate. In many cases of infringement, especially online, the fact of harm – even massive harm – is certain, but the amount of harm is difficult to quantify. Statutory damages provide a deterrent remedy against infringers and ensure that running an infringement-based business does not pay. For these reasons, this remedy is critical to our free trade agreements.

Additionally, the MPAA blasted Mexico for having privacy laws in place. They demanded they get removed so that they could basically have unfettered access to citizens private information:

Civil enforcement in Mexico is hampered because of limitations in the Telecommunications Law that prohibit ISPs from disclosing customer’s personal information to rights holders seeking civil recourse against alleged infringers. MPAA and its member companies place the highest priority on securing both the legal and practical tools necessary to protect intellectual property rights in the digital age. As discussed above, a modernized NAFTA should include provisions that support legal frameworks which promote accountability and the rule of law and create incentives for intermediaries to cooperate with rights holders in combating this serious ongoing problem.

From there, the MPAA then focused their attention onto Canada and demanded copyright term extension:

In addition to the cross-cutting intellectual property issues highlighted above, it is imperative that Canada extend the term of protection for all works measured by the life of the author to life plus 70 years.

This is a much more direct demand than what the RIAA demanded (who simply referred to it as a “global consensus”). While the MPAA reasoned that extending copyright would preserve cultural heritage, the net opposite effect is arguably what happens.

When copyright expires on a particular work, it falls into what is known as the “public domain”. In this state, anyone can remix, re-use, and do whatever they please with that work. Copyright is a limited in that it would one day fall into the public domain, long after there is any kind of monetary gain to be had on the work. This fuels innovation and increases public access to that work.

Through substantial lobbying, copyright terms have continually been extended. The net effect is that this work is then kept under lock and key away from the general public. This means the pool of creative works remains stagnant for however many years copyright terms have been extended. If the term is retroactive, then works are then also pulled from the public domain, diminishing the pool size. Activists often refer to this action as a robbery of the public domain.

To this day, there have been no known research and evidence to suggest that extending copyright terms improves a local economy or local culture. Conversely, there has been ample evidence that suggests that extending copyright terms do little to help anyone outside of a few mega-acts and corporations who own the copyright to said works.

One interesting takeaway in all of this is that the running theme between all three submissions we’ve looked at so far is the fact that these organizations are telling other countries (Canada and Mexico) how to run their countries. In fact, very few points we’ve flagged have anything to do with trade. Instead, it revolves more around lawmaking.

The indirect proposition of censorship may be a bit surprising to some as movie studios often pride themselves in being defenders of free speech. Yet, one of the propositions suggested here is that censorship be a core principal in this multilateral agreement.

Moreover, it seems that the MPAA is pushing for a number of unworkable theories and idea’s. In practice, every theory we noted here has either been a complete failure in practice, an immoral practice, or a little of both. Whether it’s censorship, statutory damages and criminal sanctions against alleged filesharers, or copyright extension, non of these ideas are really all that helpful in any setting, let alone in the NAFTA renegotiation’s.

We will continue looking into these submissions and post about anything else we find.

Drew Wilson on Twitter: @icecube85 and Google+.

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