[Federal Register Volume 75, Number 143 (Tuesday, July 27, 2010)]
[Rules and Regulations]
[Pages 43825-43839]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-18339]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 201
[Docket No. RM 2008-8]
Exemption to Prohibition on Circumvention of Copyright Protection
Systems for Access Control Technologies
AGENCY: Copyright Office, Library of Congress.
ACTION: Final rule.
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SUMMARY: The Librarian of Congress announces that the prohibition
against
[[Page 43826]]
circumvention of technological measures that effectively control access
to copyrighted works shall not apply to persons who engage in
noninfringing uses of six classes of copyrighted works.
EFFECTIVE DATE: July 27, 2010.
FOR FURTHER INFORMATION CONTACT: Robert Kasunic, Assistant General
Counsel, and David O. Carson, General Counsel, Copyright GC/I&R, P.O.
Box 70400, Washington, D.C. 20024. Telephone: (202) 707-8380. Telefax:
(202) 707-8366.
SUPPLEMENTARY INFORMATION: In this notice, the Librarian of Congress,
upon the recommendation of the Register of Copyrights, announces that
the prohibition against circumvention of technological measures that
effectively control access to copyrighted works shall not apply to
persons who engage in noninfringing uses of six classes of works. This
announcement is the culmination of a rulemaking proceeding commenced by
the Register on October 6, 2008. A more comprehensive statement of the
background and legal requirements of the rulemaking, a discussion of
the record and the Register's analysis may be found in the Register's
memorandum to the Librarian of Congress dated June 11, 2010, which
contains the full explanation of the Register's recommendation. A copy
of the Register's memorandum may be found at www.copyright.gov/1201. This notice summarizes the Register's recommendation, announces
the Librarian's determination, and publishes the regulatory text
codifying the six exempted classes of works.
I. Background
A. Legislative Requirements for Rulemaking Proceeding
The Digital Millennium Copyright Act (``DMCA'') was enacted to
implement certain provisions of the WIPO Copyright Treaty and WIPO
Performances and Phonograms Treaty. It established a wide range of
rules that govern not only copyright owners in the marketplace for
electronic commerce, but also consumers, manufacturers, distributors,
libraries, educators, and on-line service providers. It defined whether
consumers and businesses may engage in certain conduct, or use certain
devices, in the course of transacting electronic commerce.
Chapter 12 of title 17 of the United States Code prohibits
circumvention of certain technological measures employed by or on
behalf of copyright owners to protect their works (i.e., ``access
controls''). Specifically, Section 1201(a)(1)(A) provides, in part,
that no person shall circumvent a technological measure that
effectively controls access to a work protected under this title. In
order to ensure that the public will have continued ability to engage
in noninfringing uses of copyrighted works, such as fair use,
subparagraph (B) limits this prohibition. It provides that the
prohibition against circumvention shall not apply to persons who are
users of a copyrighted work which is in a particular class of works, if
such persons are, or are likely to be in the succeeding three-year
period, adversely affected by virtue of such prohibition in their
ability to make noninfringing uses of that particular class of works
under this title as determined in a rulemaking. The proceeding is
conducted by the Register of Copyrights, who is to provide notice of
the rulemaking, seek comments from the public, consult with the
Assistant Secretary for Communications and Information of the
Department of Commerce, and recommend final regulations to the
Librarian of Congress. The regulations, to be issued by the Librarian
of Congress, announce ``any class of copyrighted works for which the
Librarian has determined, pursuant to the rulemaking conducted under
subparagraph (c), that noninfringing uses by persons who are users of a
copyrighted work are, or are likely to be, adversely affected, and the
prohibition contained in subparagraph (A) shall not apply to such users
with respect to such class of works for the ensuing 3-year period.''
This is the fourth Section 1201 rulemaking.
B. Responsibilities of Register of Copyrights and Librarian of Congress
The primary responsibility of the Register and the Librarian in
this rulemaking proceeding was to assess whether the implementation of
access control measures is diminishing the ability of individuals to
use copyrighted works in ways that are not infringing and to designate
any classes of works with respect to which users have been adversely
affected in their ability to make noninfringing uses. Congress intended
that the Register solicit input that would enable consideration of a
broad range of current or likely future adverse impacts. The statute
directs that in conducting the rulemaking, the Register and the
Librarian shall examine:
(1) The availability for use of copyrighted works;
(2) The availability for use of works for nonprofit archival,
preservation, and educational purposes;
(3) The impact that the prohibition on the circumvention of
technological measures applied to copyrighted works has on criticism,
comment, news reporting, teaching, scholarship, or research;
(4) The effect of circumvention of technological measures on the
market for or value of copyrighted works; and
(5) Such other factors as the Librarian considers appropriate.
These factors to be considered in the rulemaking process require
the Register and the Librarian to carefully balance the availability of
works for use, the effect of the prohibition on particular uses, and
the effect of circumvention on copyrighted works.
C. The Purpose and Focus of the Rulemaking
1. Purpose of the Rulemaking
The task of this rulemaking is to determine whether the
availability and use of access control measures has already diminished
or is about to diminish the ability of the users of any particular
classes of copyrighted works to engage in noninfringing uses of those
works similar or analogous to those that the public had traditionally
been able to make prior to the enactment of the DMCA. In examining the
factors set forth in Section 1201(a)(1)(C), the focus is on whether the
implementation of technological protection measures has had an adverse
impact on the ability of users to make lawful uses.
2. The Necessary Showing
Proponents of a class of works have the burden of proof. In order
to make a prima facie case for designation of a class of works,
proponents must show by a preponderance of the evidence that there has
been or is likely to be a substantial adverse effect on noninfringing
uses by users of copyrighted works. De minimis problems, isolated harm
or mere inconveniences are insufficient to provide the necessary
showing. Similarly, for proof of ``likely'' adverse effects on
noninfringing uses, a proponent must prove by a preponderance of the
evidence that the harm alleged is more likely than not; a proponent may
not rely on speculation alone to sustain a prima facie case of likely
adverse effects on noninfringing uses. It is also necessary to show a
causal nexus between the prohibition on circumvention and the alleged
harm.
Proposed classes are reviewed de novo. The existence of a
previously designated class creates no presumption for consideration of
a new class, but rather the proponent of such a class of works must
make a prima facie case in each three-year period.
[[Page 43827]]
3. Determination of ``Class of Works''
The starting point for any definition of a ``particular class'' of
works in this rulemaking must be one of the categories of works set
forth in section 102 of the Copyright Act. However, those categories
are only a starting point and a ``class'' will generally constitute
some subset of a section 102 category. The determnation of the
appropriate scope of a ''class of works''; recommended for exemption
will also take into account the likely adverse effects on noninfringing
uses and the adverse effects that designation of the class may have on
the market for or value of copyrighted works.
While starting with a section 102 category of works, or a
subcategory thereof, the description of a ``particular class''of works
ordinarily should be further refined by reference to other factors that
assist in ensuring that the scope of the class addresses the scope of
the harm to noninfringing uses. For example, the class might be defined
in part by reference to the medium on which the works are distributed,
or even to the access control measures applied to them. The description
of a class of works may also be refined, in appropriate cases, by
reference to the type of user who may take advantage of the designation
of the class of works or by reference to the type of use of the work
that may be made pursuant to the designation. The ``class'' must be
properly tailored not only to address the harm demonstrated, but also
to limit the adverse consequences that may result from the creation of
an exempted class. In every case, the contours of a ``class'' will
depend on the unique factual circumstances established in the
rulemaking record on a case-by-case basis.
D. Consultation with the Assistant Secretary for Communications and
Information
Section 1201(a)(1)(C) requires the Register of Copyrights to
consult with the Assistant Secretary for Communications and Information
of the Department of Commerce (who is also the Administrator of the
National Telecommunications and Information Administration) and report
and comment on the views of the Assistant Secretary (``NTIA'') when she
makes her recommendation to the Librarian of Congress.
In addition to informal consultations throughout the course of the
rulemaking proceeding, NTIA formally communicated its views in letters
to the Register on November 4, 2009, and April 16, 2010. NTIA's views
were considered by the Register in forming her recommendation. A
discussion of NTIA's substantive analysis of particular proposals is
presented in the relevant sections of the Register's recommendation.
II. Solicitation of Public Comments and Hearings
On October 6, 2008, the Register initiated this rulemaking
proceeding pursuant to Section 1201(a)(1)(C) with publication of a
Notice of Inquiry. The NOI requested written comments from all
interested parties, including representatives of copyright owners,
educational institutions, libraries and archives, scholars,
researchers, and members of the public.
During the initial comment period that ended on December 2, 2008,
the Copyright Office received nineteen written comments proposing
twenty-five classes of works, all of which were posted on the Office's
website. Because some of the initial comments contained similar or
overlapping proposals, the Copyright Office arranged related classes
into groups, and set forth and summarized all proposed classes in a
Notice of Proposed Rulemaking (``NPRM'') published on December 29,
2008. This NPRM did not present the initial classes in the form of
proposed rule, but merely as ``a starting point for further
consideration.''
The NPRM asked interested parties to submit comments providing
support, opposition, clarification, or correction regarding the
proposals, and to provide factual and/or legal arguments in support of
their positions. The Copyright Office received a total of fifty-six
responsive comments before the comment period closed on February 2,
2009, all of which were posted on the Copyright Office website.
Four days of public hearings were conducted by the Register in May
2009 at Stanford University and the Library of Congress. Thirty-seven
witnesses, representing proponents and opponents of proposed classes of
works, testified on twenty-one proposed classes. Following the
hearings, the Copyright Office sent follow-up questions to some of the
hearing witnesses, and responses were received during the summer. The
entire record in this and the previous section 1201(a)(1)(C)
rulemakings are available on the Office's website, www.copyright.gov/1201/index.html.
On October 27, 2009, the Librarian of Congress published in the
Federal Register a Notice of an interim rule, extending the existing
classes of works exempted from the prohibition until the conclusion of
the current rulemaking proceeding and the designation of any classes of
works to be exempt from the prohibition for the ensuing three-year
period by the Librarian of Congress.
III. The Designated Classes
A. Motion pictures on DVDs that are lawfully made and acquired and that
are protected by the Content Scrambling System when circumvention is
accomplished solely in order to accomplish the incorporation of short
portions of motion pictures into new works for the purpose of criticism
or comment, and where the person engaging in circumvention believes and
has reasonable grounds for believing that circumvention is necessary to
fulfill the purpose of the use in the following instances:
Educational uses by college and university
professors and by college and university film and media studies
students;
Documentary filmmaking;
Noncommercial videos.
DVDs protected by the Content Scrambling System (CSS) have been an
issue in this rulemaking proceeding since its inception in 2000. In the
2006 rulemaking proceeding, the Librarian designated a class of
``[a]udiovisual works included in the educational library of a college
or university's film or media studies department, when circumvention is
accomplished for the purpose of making compilations of portions of
those works for educational use in the classroom by media studies or
film professors.''
In the current rulemaking, educators sought to renew and, in a
number of ways, to expand the existing class of works designated in the
last proceeding. The proposed expansions of the class involved
extending the class to include all of the motion pictures on CSS-
protected DVDs contained in a college or university library (rather
than just a film or media studies department) and to encompass
classroom use by all college and university professors and students as
well as elementary and secondary school teachers and students.
Apart from educators, others sought designation of similar classes
of works to address what they contended are adverse impacts on their
ability to engage in noninfringing uses of copyrighted works.
Documentary filmmakers argued that the prohibition on circumvention
adversely affects their ability to use portions of motion pictures in
documentary films, many of which would qualify as noninfringing uses
for the purposes of criticism or comment. Creators of noncommercial
videos that incorporate portions of
[[Page 43828]]
motion pictures contained on CSS-protected DVDs also alleged that the
prohibition on circumvention adversely affected their ability to engage
in noninfringing criticism or comment.
Based on the record in this proceeding, the Register determines
that CSS is a technological measure that protects access to copyrighted
motion pictures. She also determined that a substantial number of uses
in the record with respect to education, documentary filmmaking, and
noncommercial videos qualify as noninfringing uses.
NTIA supports expansion of the existing class of audiovisual works
to include all college and university level instructors and students
but does not believe the record justifies an expansion that would
include elementary and secondary school teachers and students. NTIA
also recommended limiting the class to address the use of DVDs included
in the educational library or departments of the academic institutions.
It also supported the proposal to designate a class of works for the
benefit of documentary filmmakers. Finally, it expressed general
support for the request to designate a class that would permit
extraction of film clips for use in noncommercial videos, but suggested
a requirement that the clips from the audiovisual work must be for
remix videos that are used for social comment or criticism, or that are
used in transformative-type works according to established fair use
principles.
Given that all of these proposed classes at issue involved motion
pictures on CSS-protected DVDs, the Register recommends that the
Librarian designate a single class addressing all of these adversely
affected uses of DVDs. However, the Register concludes that the record
does not support all of the proposed expansions of the existing class
of audiovisual works and that in at least one respect, the record
supported a contraction of that class.
What the record does demonstrate is that college and university
educators, college and university film and media studies students,
documentary filmmakers, and creators of noncommercial videos frequently
make and use short film clips from motion pictures to engage in
criticism or commentary about those motion pictures, and that in many
cases it is necessary to be able to make and incorporate high-quality
film clips in order effectively to engage in such criticism or
commentary. In such cases, it will be difficult or impossible to engage
in the noninfringing use without circumventing CSS in order to make
high-quality copies of short portions of the motion pictures. Because
not all uses by educators, documentary filmmakers or makers of
noncommerical videos will be noninfringing or will require such high-
quality copies, the class of works recommended by the Register is not
as extensive as what was requested by some proponents, and the class
contains some limitations. First, proponents for educators failed to
demonstrate that high-quality resolution film clips are necessary for
K-12 teachers and students, or for college and university students
other than film and media studies students. Because other means, such
as the use of screen capture software, exist that permit the making of
lower-quality film clips without circumventing access controls, the
Register finds no justification in the record for expanding the class
of works to include such persons as express beneficiaries of the
designation of this class of works.
Second, the circumvention of access controls must be accomplished
solely in order to enable incorporation of short portions of motion
pictures into new works for purposes of criticism of comment. The
justification offered by proponents for designating a class of
audiovisual works, and a key element of the Register's conclusion that
the intended uses will frequently be noninfringing fair uses, was that
the uses that justify designation of the class were for purposes of
criticism and commentary, which are classic ``fair use'' purposes.
Moreover, all of the evidence in the rulemaking demonstrating
noninfringing uses involved the use of short portions of motion
pictures. While the Register is persuaded that it would be difficult
and imprudent to quantify the precise contours of what constitutes a
``short portion,'' there was no evidence in the record to support the
conclusion that anything more than incorporating relatively short
portions of motion pictures into a new work for purposes of criticism
or commentary would be a fair use. Similarly, in order to meet the
requirements of the designated class of works, a new work must be
created, whether that work is a compilation of clips for use in the
classroom, or a documentary or video incorporating a clip or clips from
a copyrighted motion picture.
The final requirement of the recommended class is that the person
engaging in the circumvention must reasonably believe that the
circumvention is necessary in order to fulfill the purpose of the use -
i.e., the noninfringing criticism or commentary. Because alternatives
to circumvention such as video capture may suffice in many, and perhaps
the vast majority of situations, users must make a reasonable
determination that heightened quality is necessary to achieve the
desired goal. The justification for designating this class of works is
that some criticism and/or commentary requires the use of high-quality
portions of motion pictures in order to adequately present the speech-
related purpose of the use. Where alternatives to circumvention can be
used to achieve the noninfringing purpose, such non-circumventing
alternatives should be used. Thus, this limitation seeks to avoid an
overly broad class of works given the limited number of uses that may
require circumvention to achieve the intended noninfringing end.
The class has also been limited to include only motion pictures
rather than all audiovisual works. Because there was no evidence
presented that addressed any audiovisual works other than motion
pictures, there was no basis for including the somewhat broader class
of audiovisual works (which includes not only motion pictures, but also
works such as video games and slide presentations).
B. Computer programs that enable wireless telephone handsets to execute
software applications, where circumvention is accomplished for the sole
purpose of enabling interoperability of such applications, when they
have been lawfully obtained, with computer programs on the telephone
handset.
The Electronic Frontier Foundation (EFF) proposed a class that
would allow circumvention of the technological measures contained on
certain wireless phone handsets (known as ``smartphones'') that prevent
third-party software applications from being installed and run on such
phones. This circumvention activity is colloquially referred to as
``jailbreaking'' a phone.
The factual record with respect to this proposed class focused
primarily on Apple's iPhone, although there are allegations in the
record involving other mobile phone manufacturers as well. EFF
asserted, and Apple's testimony confirmed, that any software or
application to be used on the iPhone must be validated with the
firmware that controls the iPhone's operation. This validation process
is intended to make it impossible for an owner of an iPhone to install
and use third-party applications on the iPhone that have not been
approved for distribution through Apple's iTunes App Store.
EFF argued that jailbreaking is a noninfringing activity for three
reasons. First, it alleged that at least in some cases, jailbreaking
can be done within
[[Page 43829]]
the scope of what is authorized under the license Apple grants to every
iPhone user. It stated that ``[t]o the extent a jailbreaking technique
does not modify any of the individual software programs that comprise
the iPhone firmware collection, but instead simply adds additional
software components to the collection, the practice may not exceed the
scope of the license to `use the iPhone software' or constitute a
`modification' of any Apple software components, any more than the
addition of a new printer driver to a computer constitutes a
`modification' of the operating system already installed on the
computer.''
Second, EFF asserted that ``to the extent a jailbreak technique
requires the reproduction or adaptation of existing firmware beyond the
scope of any license or other authorization by the copyright owner, it
would fall within the ambit of 17 U.S.C. Sec. 1l7(a).'' EFF contended
that the iPhone owner is also the owner of the copy of the firmware on
the iPhone and that jailbreaking falls within the owner's privilege
``to adapt those copies to add new capabilities, so long as the changes
do not ``harm the interests of the copyright proprietor.''
Finally, EFF contended that in any event, jailbreaking constitutes
fair use of the firmware because jailbreaking is a purely
noncommercial, private use of computer software, a largely functional
work that operates the phone, and that the phone owner must reuse the
vast majority of the original firmware in order for the phone to
operate. Because the phone owner is simply modifying the firmware for
her own use on the phone, there is no harm to the market for the
firmware.
Apple responded that jailbreaking by purchasers of the iPhone is a
violation of the prohibition against circumvention of access controls.
It stated that its validation system is necessary to protect consumers
and Apple from harm. Apple further contended that modifying Apple's
operating system constituted the creation of an infringing derivative
work. Specifically, Apple argued that because purchasers of an iPhone
are licensees, not owners, of the computer programs contained on the
iPhone, Section 117 of the Copyright Act is inapplicable as an
exemption to the adaptation right. Apple further argued that the fair
use defense codified in Sec. 107 would not apply to jailbreaking
activity under the statutory factors.
Based on the record, the Register has determined that the
encryption and authentication processes on the iPhone's computer
programs are technological measures that control access to the
copyrighted work (the firmware) for purposes of Sec. 1201(a)(1).
Moreover, the Register finds that the evidence supports the contention
that a technological protection measure is adversely affecting adding
applications to the iPhone. The critical question is whether
jailbreaking an iPhone in order to add applications to the phone
constitutes a noninfringing use.
The Register does not find that the contract between Apple and
purchasers of the iPhone authorize modification of the iPhone.
Moreover, the Register cannot clearly determine whether the various
versions of the iPhone contracts with consumers constituted a sale or
license of a copy of the computer programs contained on the iPhone. The
contractual language is unclear with respect to particular copies of
the computer programs. Although Apple retains ownership of the computer
programs, the contracts also expressly grant users ownership of the
device. Since the ``copy'' of the computer program is fixed in hardware
of the device, it is unclear what ownership status is to be given to
the particular copy of the computer program contained in the device.
Apple unquestionably has retained ownership of the intangible works,
but the ownership of the particular copies of those works is unclear.
Moreover, the state of the law with respect to the determination of
ownership is in a state of flux in the courts. Both proponents and
opponents cited case law in support of their respective positions, but
the Register finds it impossible to determine how a court would resolve
the issue of ownership on the facts presented here. While both parties
agreed that the Second Circuit's decision in Krause v. Titleserv, 402
F.3d 119 (2d Cir. 2005) is ``good law,'' that case dealt with a
situation that is distinguishable in many respects from the present
situation. The Register finds that the Krause case does not provide
clear guidance as to how resolve the current issue.
However, the Register does find that the proponent's fair use
argument is compelling and consistent with the congressional interest
in interoperability. The four fair use factors tend to weigh in favor
of a finding of fair use.
Under the first factor in Section 107, it appears fair to say that
the purpose and character of the modification of the operating system
is to engage in a private, noncommercial use intended to add
functionality to a device owned by the person making the modification,
albeit beyond what Apple has determined to be acceptable. The user is
not engaging in any commercial exploitation of the firmware, at least
not when the jailbreaking is done for the user's own private use of the
device.
The fact that the person engaging in jailbreaking is doing so in
order to use Apple's firmware on the device that it was designed to
operate, which the jailbreaking user owns, and to use it for precisely
the purpose for which it was designed (but for the fact that it has
been modified to run applications not approved by Apple) favors a
finding that the purpose and character of the use is innocuous at worst
and beneficial at best. Apple's objections to the installation and use
of ``unapproved'' applications appears to have nothing to do with its
interests as the owner of copyrights in the computer programs embodied
in the iPhone, and running the unapproved applications has no adverse
effect on those interests. Rather, Apple's objections relate to its
interests as a manufacturer and distributor of a device, the iPhone.
Moreover, Congress has determined that reverse engineering for the
purpose of making computer programs interoperable is desirable when
certain conditions are met, and has crafted a specific exemption from
Section 1201(a)'s prohibition on circumvention in such cases. While an
iPhone owner who ``jailbreaks'' does not fall within the four corners
of the statutory exemption in Section 1201(f), the fact that he or she
is engaging in jailbreaking in order to make the iPhone's firmware
interoperable with an application specially created for the iPhone
suggests that the purpose and character of the use are favored.
Turning to the second fair use factor, it is customary for
operating systems - functional works - to enable third party programs
to interoperate with them. It does not and should not infringe any of
the exclusive rights of the copyright owner to run an application
program on a computer over the objections of the owner of the copyright
in the computer's operating system. Thus, if Apple sought to restrict
the computer programs that could be run on its computers, there would
be no basis for copyright law to assist Apple in protecting its
restrictive business model. The second factor decisively favors a
finding of fair use.
Turning to the third factor, ``the amount and substantiality of the
portion used in relation to the copyrighted work as a whole,'' EFF
admitted that because the Apple firmware is necessary in order to
operate the iPhone, it is necessary for individuals who jailbreak their
phones to reuse the vast majority of the original firmware. However,
the amount of the copyrighted work
[[Page 43830]]
modified in a typical jailbreaking scenario is fewer than 50 bytes of
code out of more than 8 million bytes, or approximately 1/160,000 of
the copyrighted work as a whole. Where the alleged infringement
consists of the making of an unauthorized derivative work, and the only
modifications are so de minimis, the fact that iPhone users are using
almost the entire iPhone firmware for the purpose for which it was
provided to them by Apple undermines the significance of this factor.
While the third factor arguably disfavors a fair use finding, the
weight to be given to it under the circumstances is slight.
Addressing the fourth factor, ``the effect of the use upon the
potential market for or value of the copyrighted work,'' EFF asserted
that the firmware has no independent economic value, pointing out that
the iPhone firmware is not sold separately, but is simply included when
one purchases an iPhone. EFF also argued that the ability to lawfully
jailbreak a phone will increase, not decrease, overall sales of the
phones because users will know that by jailbreaking, they can ``take
advantage of a wider array of third party applications.
Apple responded that unauthorized uses diminish the value of the
copyrighted works to Apple. However, Apple is not concerned that the
practice of jailbreaking will displace sales of its firmware or of
iPhones; indeed, since one cannot engage in that practice unless one
has acquired an iPhone, it would be difficult to make that argument.
Rather, the harm that Apple fears is harm to its reputation. Apple is
concerned that jailbreaking will breach the integrity of the iPhone's
``ecosystem.'' The Register concludes that such alleged adverse effects
are not in the nature of the harm that the fourth fair use factor is
intended to address.
NTIA does not support designating the proposed class. While
acknowledging that permitting iPhone jailbreaking could facilitate
innovation, better serve customers, and encourage the market to utilize
open platforms, NTIA believes ``it might just as likely deter
innovation by not allowing the developer to recoup its development
costs and to be rewarded for its innovation.'' NTIA also believes that
the proponents' ``public policy'' arguments should properly be
considered by expert regulatory agencies, the Department of Justice,
and the Congress. It concludes that the ``Register ought only to
consider recommending the proposed class if she concludes that the
access control measure would be a bar to actions that the above bodies
might take in response to policy judgments made at those agencies.
The Register appreciates that many regulatory and policy issues
pertaining to jailbreaking and smartphones fall within the competence
of other agencies, and the Register has no desire to interfere with
those agencies' jurisdiction. However, the only question before the
Register and the Librarian is whether Section 1201(a)(1)'s prohibition
on circumvention is adversely affecting the ability of users of
smartphones from engaging in noninfringing uses of the firmware on
their devices. No other agency has the power to limit the application
of the prohibition on circumvention in this (or any other) context. Any
future action by a federal agency to permit jailbreaking will be futile
without an exemption from liability under Section 1201(a)(1), but if a
class is not designated in this rulemaking, all that it will mean is
that Section 1201 cannot be used to prevent jailbreaking, without
prejudice to any other legal or regulatory authority that might limit
or prohibit jailbreaking.
On balance, the Register concludes that when one jailbreaks a
smartphone in order to make the operating system on that phone
interoperable with an independently created application that has not
been approved by the maker of the smartphone or the maker of its
operating system, the modifications that are made purely for the
purpose of such interoperability are fair uses. Case law and
Congressional enactments reflect a judgment that interoperability is
favored. The Register also finds that designating a class of works that
would permit jailbreaking for purposes of interoperability will not
adversely affect the market for or value of the copyrighted works to
the copyright owner.
Accordingly, the Register recommends that the Librarian designate
the following class of works:
Computer programs that enable wireless communication handsets
to execute software applications, where circumvention is
accomplished for the sole purpose of enabling interoperability of
such applications, when they have been lawfully obtained, with
computer programs on the telephone handset.
C. Computer programs, in the form of firmware or software, that enable
used wireless telephone handsets to connect to a wireless
telecommunications network, when circumvention is initiated by the
owner of the copy of the computer program solely in order to connect to
a wireless telecommunications network and access to the network is
authorized by the operator of the network.
In 2006, the Librarian designated a class of ``Computer programs in
the form of firmware that enable wireless telephone handsets to connect
to a wireless telephone communication network, when circumvention is
accomplished for the sole purpose of lawfully connecting to a wireless
telephone communication network,'' in order to permit the circumvention
of access controls that prevent the owner of a cellphone from switching
service on that cellphone to another wireless communication network.
The access controls in question are embedded in the mobile phone's
firmware or software and prevent the mobile phone owner from gaining
access to the settings that connect the mobile phone to a network
(e.g., Verizon's) other than the original network (e.g., AT&T's).
Beneficiaries of that designation have now requested that the Librarian
again designate a similar class of works. Representatives of wireless
communication networks have opposed the request.
As she did three years ago, the Register recognizes that the
requests fall within the zone of interest subject to this rulemaking.
That is, circumventing a mobile phone lock, without the authority of
the copyright owner, to gain access to the protected work (i.e., the
firmware) is likely actionable under Section 1201(a)(1) of the Act.
Further, a wireless carrier who is harmed by the circumvention of the
software lock may bring an action for violation of Section 1201(a)(1)
against anyone who circumvents such a technological protection measure.
The proponents of this class have presented a prima facie case that
the prohibition on circumvention has had an adverse effect on
noninfringing uses of firmware on wireless telephone handsets.
Proponents have shown that mobile phone locks prevent consumers from
legally accessing alternative wireless networks with the phone of their
choice. This is the same type of activity that was at issue when the
existing class of works was being considered in 2006.
The wireless networks asserted that by using a cellphone on another
network, an act that is not authorized
[[Page 43831]]
under their contracts, the customers infringe the exclusive right to
reproduce copies of the computer software, because use of the mobile
phones necessarily involves the making of copies in the random access
memory of the mobile phone. Moreover, they asserted that the alteration
of the computer programs in order enable the mobile phones to connect
to another network constituted the unlawful making of derivative works,
in violation of the copyright owner's exclusive right to prepare
derivative works.
Proponents of the class asserted that the owners of mobile phones
are also the owners of the copies of the computer programs on those
phones and that as owners they are entitled to exercise their
privileges under Section 117 of the Copyright Act, which gives the
owner of a copy of a computer program the privilege to make or
authorize the making of another copy or adaptation of that computer
program under certain circumstances. The wireless networks responded
that their contracts with their customers restrict the uses of the
customers' mobile phones and retain ownership of the copies of the
computer programs that are loaded onto the mobile phones and enable the
phones to operate. They also asserted those contractual restrictions
make the networks - and not the customers - the owners of the copies of
the computer programs, and therefore the privilege under Section 117 to
make copies and adaptations of computer programs does not apply because
that privilege is enjoyed only by the owner of the copy of the computer
program. They also argued that the privilege does not extend to the
customers' conduct because the making of a new copy or adaptation in
order to use the mobile phone on a network other than the original
network is not, as the statute requires, ``an essential step in the
utilization of the computer program in conjunction with a machine.``
The Register has reviewed the appropriate case law with respect to
who is the ``owner'' of a copy of a computer program for purposes of
Section 117 when a license or agreement imposes restrictions on the use
of the computer program and has concluded that the state of the law is
unclear. The Register cannot determine whether most mobile phone owners
are also the owners of the copies of the computer programs on their
mobile phones. However, based on the record in this proceeding, the
Register finds that the proponents of the class have made a prima facie
case that mobile phone owners are the owners of those copies. While the
wireless networks have made a case that many mobile phone owners may
not own the computer program copies because the wireless network's
contract with the consumer retains ownership of the copies, they have
not presented evidence that this is always the case even if their
interpretation of the law governing ownership is correct. The record
therefore leads to the conclusion that a substantial portion of mobile
phone owners also own the copies of the software on their phones.
The Register also concludes that when the owner of a mobile makes
RAM copies of the software in order to operate the phone - even if she
is operating it on another network - she is making a noninfringing use
of the software under Section 117 because the making of that copy is an
essential step in the utilization of that software in conjunction with
a machine.
Similarly, the making of modifications in the computer program in
order to enable the mobile phone to operate on another network would be
a noninfringing act under Section 117. As a general rule, anyone who
wishes to switch her mobile phone from one network to another must
alter some information embedded in the device. However, in a
substantial number of cases those alterations do not appear to
implicate Section 117 because the elimination and insertion of codes or
digits, or completely reflashing a phone, cannot be considered an
infringement of the computer program controlling the device. When
specific codes or digits are altered to identify the new network to
which the phone will connect, those minor alterations of data also do
not implicate any of the exclusive rights of copyright owners. And
complete reflashing does not even constitute circumvention of an access
control because it actually deletes the copy of the entire work that
had been protected by the access control, thereby permanently denying
access to that work.
In those cases where more substantial changes must be made to the
computer program in order to enable use of the mobile phone on another
network, those changes might implicate the exclusive right to prepare
derivative works. However, those changes would be privileged under
Section 117, which permits the making of ``a new copy or adaptation''
that is created as an essential step in the utilization of the computer
program in conjunction with a machine.
Section 1201(a)(1)(C) factors. As was the case in 2006, the
Register finds that the four factors enumerated in Section
1201(a)(1)(C)(i)-(iv) do not weigh either in favor of or against
designation of the proposed class of works. Moreover, because it
appears that the opposition to designating the proposed class is based
primarily on the desires of wireless carriers to preserve an existing
business model that has little if anything to do with protecting works
of authorship, it is appropriate to address the additional factor
(``such other factors as the Librarian considers appropriate'') set
forth in Section 1201(a)(1)(C)(v). It seems clear that the primary
purpose of the locks is to keep consumers bound to their existing
networks, rather than to protect the rights of copyright owners in
their capacity as copyright owners. This observation is not a criticism
of the mobile phone industry's business plans and practices, which may
well be justified for reasons having nothing to do with copyright law
and policy, but simply a recognition of existing circumstances. Because
there appear to be no copyright-based reasons why circumvention under
these circumstances should not be permitted, the Register recommends
that the Librarian designate a class of works similar to the class
designated in 2006.
The Register notes that the 2006 class, and the new one designated
herein, are both narrow, apply only to claims under Section 1201(a)(1),
and do not establish a general federal policy of ensuring that
customers have the freedom to switch wireless communications service
providers. The designated classes, both new and old, simply reflect a
conclusion that unlocking a mobile phone to be used on another wireless
network does not ordinarily constitute copyright infringement and that
Section 1201(a)(1), a statute intended to protect copyright interests,
should not be used to prevent mobile phone owners from engaging in such
noninfringing activity.
NTIA supported designation of a class similar to the class
designated in 2006, but proposed that while non-profit entities should
be permitted to take advantage of the exemption, commercial users
should not. The Register's recommendation, in contrast, would permit
some commercial activity, so long as it (1) involves only used
handsets, (2) is done by the owner of the copy of the computer program,
and (3) is done ``solely in order to access such a wireless
telecommunications network and access to the network is authorized by
the operator of the network.'' The Register believes that these
limitations ensure that the designation of this class will not benefit
those who engage in the type of commercial activity that is at the
heart of the objections of opponents of the proposed class: the ``bulk
resellers'' who purchase new mobile phone
[[Page 43832]]
handsets at subsidized prices and, without actually using them on the
networks of the carriers who market those handsets, resell them for
profit. The type of commercial activity that would be permitted would
be the resale of used handsets after the owners of the handsets have
used them and then given or sold them to somebody else, who then
resells them just as a used bookstore sells used books. The Register
acknowledges that NTIA's general view that the class should not extend
to any commercial activity is inconsistent with aspects of the
Register's recommendation, but believes that to the extent her
recommendation goes beyond what NTIA was willing to endorse, it does so
in a way that, in NTIA's words, ``prevents unlawful use by those that
would misuse the exemption for commercial purposes.''
However, the applicability of the proposed class to commercial
recyclers, such as the ones who had proposed the original class of
works, is limited. When the commercial recycler has made a derivative
work that is within Section 117's privilege for making ``adaptations,''
the recycler is subject to a significant limitation contained within
Section 117: such adaptations may be transferred only with the
authorization of the copyright owner. Thus, a recycler who prepares
such an adaptation may not transfer ownership of the copy of the
adapted computer program to anybody else without the authorization of
the copyright owner. On the other hand, a recycler who has not prepared
an adaptation is free to resell the mobile phone along with the copy of
the computer program contained within it.
The new class is also cabined by existing law in two important
respects. First, as with any regulation under Section 1201(a)(1)(C) and
(D), the designation of this class offers no safe harbor from liability
under Section 1201(a)(2) which strictly prohibits an entity from
offering a circumvention service. Second, a wireless carrier's ``Terms
of Purchase'' and ``Terms of Service'', which are binding contracts,
still impose use restrictions on consumers notwithstanding the
designation of this class. However, the wireless carrier must seek a
remedy by asserting a claim of breach of contract, and not a claim
under Section 1201(a)(1).
D. Video games accessible on personal computers and protected by
technological protection measures that control access to lawfully
obtained works, when circumvention is accomplished solely for the
purpose of good faith testing for, investigating, or correcting
security flaws or vulnerabilities, if:
The information derived from the security testing is used
primarily to promote the security of the owner or operator of a
computer, computer system, or computer network; and
The information derived from the security testing is used
or maintained in a manner that does not facilitate copyright
infringement or a violation of applicable law.
Professor J. Alex Halderman proposed two classes of works relating
to investigating and correcting security flaws or vulnerabilities
created or exploited by technological measures protecting certain kinds
of works. The Register concludes that Halderman has made the case for a
class pertaining to video games, but has not made the case for a
broader class pertaining to literary works, sound recordings and
audiovisual works.
In each case, Halderman qualified the scope of the proposed class
by restricting it to (1) lawfully obtained works protected by access
control measures that create or exploit security flaws or
vulnerabilities that compromise the security of personal computers, and
(2) cases where circumvention is accomplished solely for the purpose of
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