October 2023 Roundup of Copyright News

In October, Artificial Intelligence (AI) continues to dominate copyright law headlines as the U.S. Copyright Office received initial comments for its AI study, the White House issued an Executive Order that implicates copyright and AI, and a federal court finally took action in one of the dozen AI class-action lawsuits. Here is a quick snapshot of those and other copyright-related activities that occurred during the month of October as well as a few events to look forward to in November.

Copyright Alliance Submits Comments to USCO for AI and Copyright Study: The Copyright Alliance submitted comments to the U.S. Copyright Office for its AI and copyright study. The comments address a range of issues at the intersection of copyright and generative artificial intelligence, especially highlighting concerns surrounding infringement related to the unauthorized use of copyrighted works for training.

Copyright Alliance Submits Comments to USCO on Access to Electronic Deposits NPRM: On October 2, the Copyright Alliance and five others submitted comments to the Copyright Office in response to the proposed rule to expand the categories of the types of electronic deposits the Library of Congress can provide access to. The Copyright Alliance submitted comments pointing out that the rulemaking is premature and that further examinations of, critical updates to, and consultations on the registration and deposit systems and the Library’s security systems, programs, and practices are necessary before a rule can become effective. On October 30, the Office received nine reply comments for this rulemaking.

CCB Status Update: At the end of October 2023, 631 total cases had been filed with the Copyright Claims Board (CCB). Of these claims, 249 are “smaller claims.” In at least 188 of all cases, the claimant is using legal counsel. At least 570 of the cases involve infringement claims, 107 involve Section 512(f) misrepresentation claims, and 20 involve claims for declarations of noninfringement. The eCCB docket currently shows that the works at issue in these cases are as follows: Pictorial Graphic & Sculpture (284 cases); Literary Works (97); Motion Picture and Audiovisual Works (119); Sound Recordings (70); Musical Works (39); and some cases include claims for multiple works. Ninety foreign residents have filed claims. Of all the cases filed, 460 have been dismissed for the following reasons: Due to Respondent’s Opt Out (58); Due to Failure to Amend Noncompliant Claim (231); Registration Issues (11); Due to Failure to Provide Proof of Service of Process (87); Claimant Withdrawal and Dismissal of Claims (42); Bad Faith Claimant (6); and Settlement (25). There are 47 active proceedings and nine final determinations.

USCO Receives Over 10,000 Comments for AI and Copyright NOI: The U.S. Copyright Office received over 10,000 comments in response to its notice of inquiry soliciting public comments on AI and copyright issues for the Office’s AI study. Comments were still being posted as this blog post was published. Groups submitting comments included the American Society of Media Photographers and North American Nature Photography Association; Authors Guild; A2IM and RIAA; Department for Professional Employees, AFL-CIO (including Directors Guild of America, International Alliance of Theatrical Stage Employees, SAG-AFTRA, and Writers Guild of America, East; News/Media Alliance; and Motion Picture Association

USCO to Renew Most Existing 1201 Exemptions; Solicits Comments on Proposed New or Expanded Exemptions: On October 19, the Copyright Office published a notice of proposed rulemaking, proposing to renew all but one of the existing exemptions to the Digital Millennium Copyright Act’s (DMCA) prohibition against anti-circumvention of technological measures protecting copyrighted works. The Office noted that since no renewal petition was received for the current exemption permitting circumvention of video games in the form of computer programs for the purpose of allowing an individual with a physical disability to use alternative software or hardware input methods, the Office will not recommend this exemption to the Librarian of Congress for approval. Proposed new or expanded exemptions include expansion to the TDM of literary and audiovisual works in the scholarly/research contexts and a new proposed exemption for computer programs for generative AI research. The Office will hold three rounds of public comments on new or expanded exemptions in addition to virtual public hearings, which will be held in spring 2024.

HJC IP Subcommittee Holds Hearing on China IP Issues: On October 19, the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet held a hearing titled Intellectual Property and Strategic Competition with China: Part III – IP Theft, Cybersecurity, and AI. The hearing examined current capabilities and risks in the arms race between the U.S. and the People’s Republic of China in the development of artificial intelligence (AI). The hearing also focused on the cybersecurity implications of AI and its potential impacts on protecting US intellectual property and technical resources, including data. Witnesses addressed issues related to China’s use of AI, the protection of intellectual property rights, data collection and AI training, the potential risks of AI-generated content, and the balance between responsible regulation and innovation. The hearing highlighted the urgent need for comprehensive approaches to AI governance, cybersecurity measures, and the preservation of American values while addressing the growing challenges posed by China in a dynamic technological landscape.

SJC IP Subcommittee Holds Hearing on SHOP SAFE Act: On October 3, the Senate Judiciary Committee’s Subcommittee on Intellectual Property held a hearing titled, Back to School with the SHOP SAFE Act: Protecting Our Families from Unsafe Online Counterfeits regarding the SHOP SAFE Act (S. 2934). Witnesses included Matthew Schruers, President, Computer & Communications Industry Association (CCIA); Stephen Lamar, President & CEO, American Apparel & Footwear Association (AAFA); Daniel Shapiro, Senior Vice President, Brand Relationship and Strategic Partnerships, Red Points; and Kari Kammel, Director and Senior Academic Specialist, Center for Anti-Counterfeiting and Product Protection. In his opening statement, Chairman Chris Coons (D-DE) highlighted the rapid expansion of online shopping and emphasized the critical importance of addressing the issue of counterfeit goods online while promoting responsible and innovative business practices and the concurrent increase in online counterfeiting. 

Court Grants Stability AI’s Motion to Dismiss Visual Artists’ Class-Action Lawsuit: On October 30, the district court for the Northern District of California largely granted the motions to dismiss the class-action lawsuit filed by a group of visual artists against Stability AI, DeviantArt, and Midjourney. Though the court largely dismissed the claims, plaintiffs were provided with leave to amend the claims. The court dismissed the claims made by McKernan and Ortiz, in light of the fact that their works were not timely registered with the U.S. Copyright Office. Though the headlines about this case may frame this decision as a loss for the creative community, that is not the case, because importantly, the court denied Stability’s motion to dismiss the plaintiffs’ direct copyright infringement claims with respect to their images scraped/ingested into the LAION training datasets used to train Stable Diffusion, and also held that plaintiffs’ assertions that their works had likely been used in the LAION datasets as per results from the “haveibeentrained” website adequately supported her infringement claims at this stage of the lawsuit.

Authors File Class Action AI-Related Lawsuit Against Meta and Bloomberg: On October 17, a group of authors including former Arkansas governor, Mike Huckabee, and best-selling Christian author, Lysa TerKeurst, filed a class-action lawsuit in the district court for the Southern District of New York against Meta, Microsoft, EleutherAI, and Bloomberg for direct and vicarious copyright infringement, removal of copyright management information, and various other state-law claims. The plaintiffs allege that the defendants infringed by using plaintiffs’ books to develop defendants’ large language AI models (LLMs) using the “Books 3” training dataset. The lawsuit also asserts that AI research company, EleutherAI, is liable for copyright infringement for hosting and distributing “The Pile” dataset, which includes Books3. 

Music Publishers Sue AI Company, Anthropic: On October 18, music publishers Universal Music Publishing Group, Concord Music Group, and ABKCO, filed a lawsuit in the district court for the Middle District of Tennessee against the AI company, Anthropic, alleging direct, contributory, and vicarious copyright infringement as well as copyright management information removal claims. The plaintiffs allege that Anthropic unlawfully copied and distributed plaintiffs’ musical works, including lyrics, to develop Anthropic’s generative AI chatbot, Claude. The plaintiffs state that when prompted, Claude generates output that copies the publishers’ lyrics. The plaintiffs’ complaint claims that 500 works have been infringed and requests statutory damages of $75 million for copyright infringement.

Biden Administration Activities

President Biden Issues AI Executive Order: On October 30, President Biden signed the long-awaited Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence (EO). The EO covers a number of topics. A Fact Sheet that describes the EO is available. Section 5.2 of the EO titled “Promoting Innovation”, paragraph (c)(iii) addresses copyright. It says: “within 270 days of the date of this order or 180 days after the United States Copyright Office of the Library of Congress publishes its forthcoming AI study that will address copyright issues raised by AI, whichever comes later, consult with the Director of the United States Copyright Office and issue recommendations to the President on potential executive actions relating to copyright and AI. The recommendations shall address any copyright and related issues discussed in the United States Copyright Office’s study, including the scope of protection for works produced using AI and the treatment of copyrighted works in AI training.”

The EO also directs the Secretary of Homeland Security, acting through the head of the National Intellectual Property Rights Coordination Center, and in consultation with the Attorney General to develop a training, analysis, and evaluation program to mitigate AI-related IP risks. Such a program shall: (i) include appropriate personnel dedicated to collecting and analyzing reports of AI-related IP theft, investigating such incidents with implications for national security, and, where appropriate and consistent with applicable law, pursuing related enforcement actions; (ii) implement a policy of sharing information and coordinating on such work, as appropriate and consistent with applicable law, with the Federal Bureau of Investigation; Customs and Border Protection; other Federal agencies; State, and local agencies; and appropriate international organizations, including through work-sharing agreements; (iii) develop guidance and other appropriate resources to assist private-sector actors with mitigating the risks of AI-related IP theft; (iv) share information and best practices with AI developers and law enforcement personnel to identify incidents, inform stakeholders of current legal requirements, and evaluate AI systems for IP law violations, as well as develop mitigation strategies and resources; and (v) assist the Intellectual Property Enforcement Coordinator in updating the Intellectual Property Enforcement Coordinator Joint Strategic Plan on Intellectual Property Enforcement to address AI-related issues.”

OMB Release New Draft AI Guidance for Federal Government: On November 1, the Office of Management and Budget (OMB) released a memorandum providing guidance on federal government uses of AI. The memorandum acknowledges that AI could impact intellectual property and among other things, directs federal departments and agencies to designate Chief AI Officers and to ensure that procured AI complies with applicable laws, including those addressing privacy confidentiality, copyright, and civil rights and liberties. A summary is available on the White House’s website.

USPTO Holds Roundtable on ‘Future Strategies in Anti-Counterfeiting and Anti-Piracy’: On October 3, the U.S. Patent and Trademark Office (USPTO) held a roundtable on Future Strategies in Anti-counterfeiting and Anti-piracy. The event discussion highlighted the challenges of addressing copyright claims in countries with less stringent legislation and enforcement and the limitations of relying solely on technology to manage piracy and copyright issues. Kevin Madigan, VP of Legal Policy at the Copyright Alliance, participated in the roundtable. Panelists discussed the potential of the Office to bring parties together to explore cooperative possibilities and the importance of trust in the customer-brand relationship. The panelists also discussed the challenges of obtaining injunctive relief in online piracy cases and the outdated nature of the DMCA, which lacks clear definitions and recognized standards for identifying and protecting copyrighted works online. Further, participants emphasized the importance of ensuring that copyright does not become a mere tool in industrial policy and the need to maintain a balanced viewpoint that doesn’t allow copyright to be undermined by industrial policy. 

G7 Issues Final AI Principles/Codes Acknowledging Copyright Protections: On October 30, the G7 released the Hiroshima AI Guiding Principles and AI Code of Conduct which include references in Principle 11 addressing the need for implementation of protections for intellectual property and transparency of training datasets.

UK Parliament Warns of Piracy Threat from NFTs: On October 11, the UK Parliament’s Culture, Media, and Sport Committee issued a report and statement warning that “the emergence of non-fungible tokens (NFTs) in the world of art has led to the risk of widespread copyright infringement” and that “the promotion of crypto assets in professional sport is putting supporters at risk of financial harm and potentially damaging the reputations of clubs.” In its recommendations, the Committee urges the UK government to protect creators from NFT-related copyright infringement by working with NFT marketplaces to develop a code of conduct that would protect creators, consumers, and sellers from infringing and potentially fraudulent material sold on NFT platforms.

French Court Awards €489 Million in Damages for Rightsholders; Sentences Pirate Website Operators Up to Three Years of Prison: A French criminal court in Rennes sentenced two operators of notorious illicit torrent site, T411, to 18-month and three-year prison sentences and is holding the operators responsible for approximately €300,000 in total. The court also awarded rightsholders €489 million in damages for the over 190,000 torrents and 270 million downloads of movies and music that authorities were able to trace.

Submissions to Notorious Markets List to USTR: The Entertainment Software Association (ESA), RIAA, Motion Picture Association (MPA), and the Association of American Publishers (AAP) each submitted a non-exhaustive list to the Office of U.S. Trade Representative (USTR) for inclusion in the USTR’s upcoming 2023 Notorious Market list.

Brazilian Authorities Shut Down Music Piracy Website: On October 25, the International Federation of the Phonographic Industry (IFPI) announced that in coordination with Brazilian authorities, they had shut down a prominent illegal file sharing website, FileWarez.tv. The website had more than 118,000 registered users with at least 24,000 monthly active users who mostly engaged in sharing illegal copies of music files.

Industry Activities

News/Media Alliance Publishes AI White Paper: On October 30, the News/Media Alliance (N/MA) published a white paper titled How the Pervasive Copying of Expressive Works to Train And Fuel Generative Artificial Intelligence Systems Is Copyright Infringement and Not a Fair Use, focusing on the impact and copyright law issues of generative AI on publishers’ works. The White Paper and Technical Analysis made several findings including how generative AI copying of protected works is not fair use, how developers have copied and used news media content to train large language models, and how vital news media content has been in the training and development of commercial AI products, including Google’s Bard. More information is available on N/MA’s website.

Look Forward to And Save the Date For…

2023 Christopher A. Meyer Memorial Lecture: On November 2 from 6:00 p.m. to 8 p.m. ET, The Law Office of Michael R. Klipper, the George Washington University Law School, and the Copyright Society will again sponsor the Christopher A. Meyer Memorial Lecture. Justin Hughes, who is the Honorable William Matthew Byrne Professor of Law at Loyola University Law School, and visiting Professor at Oxford University, will deliver a lecture titled Intellectual Property and the Creatures of Generative AI. 

Extended Deadline to Submit Comments to USCO on MMA Royalty Distribution Issues in New Supplemental NPRM: Comments are now due on November 8, and reply comments are due November 28, in response the U.S. Copyright Office’s supplemental notice of proposed rulemaking (SNPRM). The SNPRM includes additional analysis on the application of the derivative works exception to the statutory termination right (“Exception”) in the context of various royalties administered by the MLC. 

WALA, NAVA, and GMU Arts and Entertainment Advocacy Clinic Seminar on ‘AI and Copyright’: On November 14 from 2 p.m. to 3:30 p.m. ET, the National Association of Voice Actors (NAVA), Washington Area Lawyers for the Arts (WALA), and the George Mason University (GMU) Arts and Entertainment Advocacy Clinic will host a bi-annual seminar on trending legal issues, titled Artificial Intelligence and Copyright. In particular, the event hosts will discuss how AI is infringing on artists’ rights and the methods artists can use to protect themselves. Event speakers will also share examples from the voice artist field to illustrate how easily AI can mimic someone’s voice. If you have a specific question, please email it in advance to legalservices@waladc.org or use the questions section on the Eventbrite registration page.

Columbia University Symposium on Accountability and Liability in Generative AI: On November 17 from 10 a.m. to 5 p.m. ET, the Columbia University Science, Technology & Intellectual Property Law Program and Science and Technology Law Review are sponsoring a symposium titled Accountability and Liability in Generative AI: Challenges and Perspectives. The featured authors and commentators are Mark Lemley, Stanford University Law School; Paul Ohm, Georgetown University Law Center; Catherine Sharkey, New York University School of Law; Alicia Solow-Niederman, George Washington University Law School; Alice Xiang, Global Head of AI Ethics, Sony; Christopher Yoo, University of Pennsylvania Carey Law School; Shyamkrishna Balganesh, Talia Gillis, Thomas Merrill, and Eric Talley, Columbia University Law School; Matthew Sag, Emory University School of Law; and Tim Wu, Columbia University Law School. This event takes place at the Columbia Law School, located at 435 West 116th Street, New York, NY.

USCO Deadline for Submitting Reply Comments on AI Study: Written comments are due November 29 in response to the Copyright Office’s notice of inquiry of various questions related to artificial intelligence and copyright to inform the Office’s ongoing study of AI issues, including those involved in the use of copyrighted works to train AI models, the appropriate levels of transparency and disclosure with respect to the use of copyrighted works, and the legal status of AI-generated outputs. 

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