TCS Daily

Promoting Progress

By James V. DeLong - March 6, 2003 12:00 AM

The Supreme Court's Eldred decision, which upheld the validity of the Sonny Bono Copyright Term Extension Act (CTEA), has caused little stir. The case involved the old issue of the proper length of copyright, not some new problem triggered by the Internet Age, and most people regard the question whether copyright terms should average 95 years instead of 75 as a yawner.

Actually, the stakes were higher than this immediate issue, and the outcome more important. C/Net reporter Declan McCullagh observed: "[P]rofessor Larry Lessig and his allies were hoping when they launched the challenge not merely to overturn this law but to build momentum for an all-out legal assault on other recent copyright expansions." This is dead right. The challenge to the time extension was built on premises that were skeptical - indeed, hostile - to IP as an institution. The Supreme Court made clear that it does not share these hostile premises, an action with important implications for intellectual property in the future.

The U.S. Constitution gives Congress the power "To promote the Progress of Science and useful Arts by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." In conventional legal analysis, this makes the clause utilitarian in nature. Creators are protected as instruments of "Progress," not because they have any natural right to the fruits of their effort.

This one-dimensional utilitarianism is dubious because the moral claims of creators were more prominent in the minds of the Founding generation than the conventional view would have it. The copyright clause is best seen as a blend of utilitarianism, recognition of creators' rights, practical economic assessment of what is necessary to foster creativity, and political compromise.

However, plaintiffs in Eldred pushed to the limit, and beyond, the view that intellectual property belongs to "the public." The "promote Progress" language was to be applied to each legislative enactment, not to the body of copyright law as a whole. The tenet that a copyright holder has a "monopoly" was asserted at least a dozen times, even though few copyright holders have any meaningful market power. Creators were to be rewarded only to the minimum necessary to keep them industrious, with any extra value becoming public property. The number of works in the public domain was to be maximized, and the relationship of creators and the public was seen as a zero-sum game; gains by creators represent losses to the public. Complicated issues of long-term maintenance and dissemination of intellectual property were ignored, and plaintiffs contended that Congress could do nothing for creators unless the public received an immediate tangible advantage in the form of increased ex ante incentives to create. The idea that the relationship between creators and users of intellectual products should involve reciprocity was totally absent; creators are to give, and users to get.

Free speech rights were invoked by Eldred. Allowing the claims of copyright to limit the use of materials could be justified only by a compelling government interest, a standard not met by any benefits from the CTEA.

The Supreme Court did not buy any of these premises. The "promote Progress" constitutional language applies to the body of copyright law as whole; it is not a test for measuring each statutory provision. Furthermore, the mechanism chosen to promote progress is to reward creators, whose interests are congruent with those of the public rather than conflicting. The Court quoted with approval lower court language that "Copyright law celebrates the profit motive, recognizing that the incentive to profit . . . will redound to the public benefit." Free speech interests are protected by copyright doctrine itself, including the principle that one can copyright only particular expressions, not underlying ideas, that fair use is allowed, and that facts cannot be protected. The First Amendment protects ones right to speak, but not one's right to appropriate the speech of others. The same doctrines limit the monopoly power of the copyright holder.

On the actual issue at hand - the term extension - the Court drew from its premises the conclusion that "its up to Congress." As a policy issue, one can agree with the CTEA or not, but either way one should be relieved at the decision. Going the other way would have opened the courts to a grinding guerilla war over IP and the precise meaning of "promote Progress." The judicial battles over the antitrust laws and the meaning of "competition" provide an unfortunate model of what could happen.

With this possibility forestalled, effort can be spent in more productive ways. The briefs in Eldred did raise significant issues, though not the ones that were the focus of the case. These are primarily problems of transaction costs - finding copyright holders, negotiating rights, and putting together deals is difficult and expensive. Mechanisms are needed to reduce these costs, such as copyright registries, auction markets, and industry standards. There is a strong parallel between the transaction-cost complaints of Eldred and his allies and the comments of record company execs who are trying to put together packages of online music for pay, and are facing roughly the same set of problems.

So Eldred was important because it rejected the effort to persuade the Court to adopt an orientation toward copyright that would have been destructive. As victories go, this may not seem dramatic. But those who believe that people's right to the products of their creativity is one of the mainsprings of both human liberty and progress, and that supporting this right is the ultimate utilitarianism, should accept it gratefully.

The author is Senior Fellow & Director, Center for the Study of Digital Property, The Progress & Freedom Foundation. The opinions expressed are solely his own.

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