Notes: Chapter 4

1. For the background to these documents see James Boyle, “Intellectual Property Policy Online: A Young Person’s Guide,”Harvard Journal of Law & Technology 10 (1996): 47–112; Jessica Litman, Digital Copyright: Protecting Intellectual Property on the Internet (Amherst, N.Y.: Prometheus Books, 2001).

2. Pub. L. No. 105-304, 112 Stat. 2860 (1998) (codified as amended in scattered sections of 5, 17, 28, and 35 U.S.C.).

3. Intellectual Property and the National Information Infrastructure: The Report of the Working Group on Intellectual Property Rights (Washington, D.C.: Information Infrastructure Task Force, 1995), 73 n. 227. Hereinafter White Paper.

4. White Paper, 84.

5. “Congress did not provide that one class in the community could combine to restrain interstate trade and another class could not. . . . It provided that ‘every’ contract, combination or conspiracy in restraint of trade was illegal.” Loewe v. Lawlor, 208 U.S. 274 (1908); “Indians inhabiting this country were fierce savages, whose occupation was war, and whose subsistence was drawn chiefly from the forest. To leave them in possession of their country, was to leave the country a wilderness. . . .”Johnson v. M’Intosh, 21 U.S. 543, 590 (1823).

6. “As the entertainment and information markets have gotten more complicated, the copyright law has gotten longer, more specific, and harder to understand. Neither book publishers nor libraries have any interest in making the library privilege broad enough so that it would be useful to users that aren’t libraries, and neither movie studios nor broadcast stations have any interest in making the broadcaster’s privilege broad enough to be of some use to say, cable television or satellite TV, so that doesn’t happen. Negotiated privileges tend to be very specific, and tend to pose substantial entry barriers to outsiders who can’t be at the negotiating table because their industries haven’t been invented yet. So negotiated copyright statutes have tended, throughout the century, to be kind to the entrenched status quo and hostile to upstart new industries.” Litman, Digital Copyright, 25.

7. Communications Decency Act of 1996 (47 U.S.C. §§ 230, 560, 561) (1996).

8. Reno v. ACLU, 521 U.S. 844 (1997).

9. James Boyle, “Overregulating the Internet,” Washington Times(November 14, 1995), A17.

10. See James Boyle, “The One Thing Government Officials Can’t Do Is Threaten Their Critics,” Washington Times (March 6, 1996), A16.

11. “The DFC was forged in 1995 in response to the release of the Clinton administration’s White Paper on Intellectual Property and the National Information Infrastructure. The White Paperrecommended significantly altering existing copyright law to increase the security of ownership rights for creators of motion pictures, publishers and others in the proprietary community. Members of the DFC recognized that if the policy proposals delineated in the White Paper were implemented, educators, businesses, libraries, consumers and others would be severely restricted in their efforts to take advantage of the benefits of digital networks.” See

12. See the classic account in Mancur Olson, The Logic of Collective Action: Public Goods and the Theory of Groups, 2nd ed. (Cambridge, Mass.: Harvard University Press, 1971).

13. See note 2 above.

14. Pub. L. No. 105-147, 111 Stat. 2678 (1997) (codified as amended in scattered sections of 17 and 18 U.S.C.).

15. Pub. L. No. 105-298, 112 Stat. 2827 (1998) (codified as amended in scattered sections of 17 U.S.C.).

16. S 2291, 105th Cong. (1998).

17. Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984).

18. See Tina Balio, Museum of Broadcast Communications, “Betamax Case,” Encyclopedia of TV (1997), available at betamaxcase.htm (“The Betamax case went all the way to the Supreme Court, which reversed the appeals court decision on 17 January 1984. By 1986, VCRs had been installed in fifty percent of American homes and annual videocassettes sales surpassed the theatrical box-office.”). The year 1986 was also the peak of the video rental market: “Video’s high mark, according to studies by A. C. Nielsen Media Research, was in late 1986, when an estimated 34.3 million households with VCR’s took home 111.9 million cassettes a month, or an average of 3.26 movies per household.” Peter M. Nichols, “Movie Rentals Fade, Forcing an Industry to Change its Focus,” New York Times (May 6, 1990), A1.

19. For background, see Wendy Gordon, “Fair Use as Market Failure: A Structural and Economic Analysis of the Betamax Case and Its Predecessors,” Columbia Law Review 82 (1982): 1600–1657. For accounts that imagine a reduction of fair use as transaction costs fall, see Edmund W. Kitch, “Can the Internet Shrink Fair Use?,” Nebraska Law Review 78 (1999): 880–890; Robert P. Merges, “The End of Friction? Property Rights and the Contract in the ‘Newtonian’ World of On-Line Commerce,”Berkeley Technology Law Journal 12 (1997): 115–136. This argument has hardly gone unanswered with articles pointing out that it neglects both the social values of fair use and the actual economics of its operation. See Jonathan Dowell, “Bytes and Pieces: Fragmented Copies, Licensing, and Fair Use in A Digital World,” California Law Review 86 (1998): 843–878; Ben Depoorter and Francesco Parisi, “Fair Use and Copyright Protection: A Price Theory Explanation,” International Review of Law and Economics 21 (2002): 453–473.

20. “I believe the answer to the question of justification turns primarily on whether, and to what extent, the challenged use istransformative. The use must be productive and must employ the quoted matter in a different manner or for a different purpose from the original.” Pierre N. Leval, “Toward a Fair Use Standard,”Harvard Law Review 103 (1990): 1111.

21. See Neil Weinstock Netanel, “Locating Copyright Within the First Amendment Skein,” Stanford Law Review 54 (2001): 1–86; Yochai Benkler, “Free As the Air to Common Use: First Amendment Constraints on Enclosure of the Public Domain,”New York University Law Review 74 (1999): 354–446; Larry Lessig, Melville B. Nimmer Memorial Lecture: “Copyright’s First Amendment” (March 1, 2001), in UCLA Law Review 48 (2001): 1057–1074; Melville B. Nimmer, “Does Copyright Abridge the First Amendment Guaranties of Free Speech and the Press?”UCLA Law Review 17 (1970): 1180–1204.

22. Sega Enterprises Ltd. v. Accolade, Inc., 977 F.2d 1510 (9th Cir. 1992); Atari Games Corp. v. Nintendo of America Inc., 975 F.2d 832 (Fed. Cir. 1992).

23. Sony 464 U.S. at 441 n. 21.

24. A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).

25. A&M Records v. Napster: C-SPAN Videotape 159534, Part 1 of 1 (October 2, 2000).

26. Felix Oberholzer-Gee and Koleman Strumpf, “The Effect of File Sharing on Record Sales: An Empirical Analysis,” Journal of Political Economy 115, no. 1 (2007): 1–42.

27. Stan J. Liebowitz, “How Reliable Is the Oberholzer-Gee and Strumpf Paper on File-Sharing?” available at

28. Rafael Rob and Joel Waldfogel, “Piracy on the High C’s: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students,” available at

29. M. Peitz and P. Waelbroeck, “The Effect of Internet Piracy on Music Sales: Cross-Section Evidence,” Review of Economic Research on Copyright Issues (December 2004): 71–79, available at For an excellent general discussion see Rufus Pollock’s summary of the empirical evidence at

30. MGM Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (2005).

31. J. H. Saltzer, D. P. Reed, and D. D. Clark, “End-to-End Arguments in System Design,” ACM Transactions on Computer Systems (November 1984): 277.

32. Technically, this discussion fuses components of the Internet—its transfer protocols, for example—with aspects of the World Wide Web, the set of linked hypertext documents assembled on top of it.