A year ago today, the Gowers Review was released to the public. The Government accepted all of the 54 recommendations it made, and experts welcomed the balanced approach it took to intellectual property law in the digital age, since it matched greater flexibility with tougher measures on enforcement (although at the time, we flagged its failure to distinguish between large-scale commercial counterfeiting, and small-scale non-commercial acts carried out by individuals, now a live issue with current IPRED 2 negotiations). But one year on, things don’t look quite so rosy.

I interviewed Andrew Gowers a few hours after the release of the Review. He said that enforcement and flexibility were “two sides of the same coin”. The Review states:

“Copyright in the UK presently suffers from a marked lack of public legitimacy. It is perceived to be overly restrictive, with little guilt or sanction associated with infringement.”

Gowers’s suite of recommendations attempted to redress this situation by re-instating the balance in copyright law. So how has Government performed in implementing Gowers’s recommendations?

In April this year, changes to the Copyright, Designs and Patents Act came into force that allowed Trading Standards to enter premises and seize goods and documents they believe to be involved in copyright infringement. These changes were backed by £5m in new funding for Trading Standards. There is little question that this contributed to the arrests of webmasters at TV-links and Oink later in the year.

In May, the UK Intellectual Property Office (UK IPO) quietly delayed its consultations on changes to the law that would allow a private copying exception, an exception for researchers, for libraries and educators, and for those creating works of parody or pastiche out of copyrighted works.

In November, at an event hosted by the Social Market Foundation, the recording industry revealed plans to cooperate with ISPs and launch a “3 steps and you’re terminated” regime that would cut off the internet connections associated with people believed to be sharing copyrighted works unlawfully. This industry cooperation is recommendation 39 of the Gowers Review, and it looks to be on schedule.

A call to the UK IPO yesterday confirmed that consultations on the exceptions to copyright law have been further delayed, and will now not be seen until the New Year. These are consultations, the first baby step in implementation, and it’s unlikely that any actual legal amendments will be seen until 2009 at the earliest.

What’s more, when the Open Rights Group met with culture minister Margaret Hodge and senior officers from DCMS and the UK IPO in October, it was revealed that actions to implement recommendation 11, that copyright should be amended at the European level to create an exception for transformative works, had not even been timetabled.

If enforcement and flexibility are two sides of the same coin, then one year on it looks like the toss has definitely gone to enforcement. This means that Government is in effect making the situation worse: concentrating on strengthening enforcement measures while failing to address the inherent inflexibility of copyright law that Gowers identified as a key factor in the general public’s disrespect for the law.

It’s up to all of us who submitted evidence to Gowers in 2006 to keep the pressure up on Government to make good on their promise to reform copyright for the digital age.

The resounding message of the Olswang’s and Greenberg Traurig’s Friday Open Source Summit (PDF) was that software patents are bad for business. Bruce Perens’s message against software patents and that the European Patent Litigation Agreement (EPLA) should not become a reality was echoed throughout the day by numerous speakers to be restated once again during Simon Phipps closing keynote. The main argument was that these patents hinder software development because of their high transaction costs, and that Europe can maintain advantages by not allowing these patents (available in the US and elsewhere) on its shores. Naturally enough, there wasn’t anyone calling for the abolition of patents, only as they relate to software.

But software patents weren’t the only theme of the day.

Bruce Perens - Opening keynote

Perens is one of a handful of early and influential ‘founders’ of free and open source software (FOSS) and he gave an entertaining and informative overview of the benefits of FOSS and how they fit in with a company’s business model. The key for any business is to look at what is the “differentiating software” — the model or software that makes the business different from others. For non-differentiating software open source is key as it can help control costs while delivering a robust architecture.

Beyond his call against software patents, he suggested that the UK and Europe could use a law requiring open source software to at least be considered for (presumably) public purchasing.

Heather Meeker, of Greenberg Traurig, gave an excellent overview of the legal side of FOSS licensing.

Jim Markwith of Microsoft concentrated on issues surrounding open source in a mergers and acquisition (M&A) context. Often one of the issues is finding inappropriate (copied w/o permission) code in FOSS projects. Many of the problems that he sees in the M&A role at Microsoft are a result of poor IP management and not open source per se. As regards software patents, he only stated that Microsoft takes a different position than the other speakers.

On the GPLv3, he did note that “GPLv2 has built up a legal understanding over the past fifteen years and now v3 means that they don’t have that understanding.”

Nigel Swycher, Olswang and chair of the event, and Kat McCabe, Black Duck, both further reviewed FOSS within the M&A context. Black Duck makes a product that reviews and audits software code to make sure that it does not contain illegally copied code.

In the afternoon Jan Wildeboer, Red Hat, and Pieter Hintjens, iMatix, both further made the case against software patents and open source business models. Hintjens had the notable quote that the GPL is “an ‘ultra capitalist tool’ because it allows dual licensing a commercial option plus the GPL version.”

Dietmar Tallroth, Nokia, discussed some of the practical aspects of managing open source software through his experiences as the legal director of open source and licensing at Nokia.

David Wood from Symbian gave an overview of open source and smartphones.

John Powell, Alfresco Software, got back to one of the main themes of the conference. From the conference site:

The software development and licensing landscape has changed, and the US are perceived to be leading the way. The Summit seeks to address this imbalance.

Powell blamed the close ties and use of the English language for waves and waves of US commercial interests following a proprietary licensing model for crushing both the UK’s indigenous software industry and free and open source software development. In short, because of the lack of a language barrier, UK companies and public sector organisations bought into the FUD against FOSS and thus never got off the ground. Now however is the time for the pendulum to swing the other way and for a UK FOSS community and use to dramatically take off.

Graham Taylor, Openforum Europe, discussed open standards and mentioned that in his opinion the UK government has been largely absent when compared to its EU counterparts at European meetings on open standards, open source.

Michael Robinson, Deloitte, covered how they saved large amounts of money and introduced greater stability by introducing open source into the Oyster card system for London’s transport.

Simon Phipps, Sun Microsystems, closed the day with a slight restatement of the day’s theme against software patents. He wasn’t against them per se, however he thought that their granting should be greatly tightened so that they were very hard to get. There was still some room for their use if limited in this way.

He did however note that trade marks are the next wave of legal problems for the FOSS community and that this would be the most troublesome area moving forward. In addition, he gave a load of practical advice on using FOSS within a company and how to relate to the greater open source community.

The day was well attended by a diverse set of lawyers, academics, developers and others. A definite tip of the hat to Olswang and their partners on the event Greenberg Traurig for the day.

It’s time to get in touch with your MEP again.

IPRED2 – the EU’s second intellectual property enforcement directive – is going to the vote at the EU Parliament next week. If it passes in its current form, “aiding, abetting, or inciting” copyright infringement on a “commercial scale” in the EU will become a crime. What’s more, it will be the first time the EU will force countries to impose minimal criminal sanctions – this is normally left up to the discretion of member states.

EFF Europe have set up a new website – copycrime.eu – to help stop the directive coming into law in its current form. According to them:

“IPRED2’s new crime of “aiding, abetting and inciting” infringement takes aim at innovators, including open source coders, media-sharing sites like YouTube, and ISPs that refuse to block P2P services.

With the new directive, music labels and Hollywood studios will push for the criminal prosecution of these innovators in Europe, saying their products “incite” piracy - with EU taxpayers covering the costs.

Under IPRED2, these same entertainment companies can work with transnational “joint investigation teams” to advise the authorities on how to investigate and prosecute their rivals!”

The directive is poorly drafted, and doesn’t define “commercial scale” well enough to ensure that ordinary citizens exercising their rights under copyright and trademark law aren’t at risk of penalties and fines. EFF, FFII, BEUC and EBLIDA have jointly drafted a set of amendments, which have been tabled by the European Green Party. The amendments would:

• Limit the scope of IPRED2 to true criminal enterprises, involving copyright piracy and trademark violations done on a commercial scale, with malice and the intention of earning a profit from the enterprise
• Avoid creating an unprecedented scope of secondary liability for Internet intermediaries, ICTs, software vendors and a range of legitimate business activity, by removing the words “aiding or abetting and inciting” from Article 3
• Provide legal certainty by adopting precise and appropriate definitions of “on a commercial scale” and “intentional infringement” in Article 2 as commercial activity done with the intent to earn a profit directly attributable to the infringing activity

The coalition need you to get in touch with your MEP and ask him or her to support these tabled amendments before the vote on 24 April. All MEPs have been sent a copy of the proposed amendments, so they will know what you’re talking about when you ask them to “support the librarians’, consumers’ and innovators’ coalition amendments to IPRED2”.

For more details on the amendments, advice and suggestions on what to say to your MEP, and to sign EFF Europe’s petition against IPRED2, visit the Copycrime action page.

IPRED2, the European Union’s second intellectual property enforcement directive, is going to the vote at the end of this month. The European Parliament’s committee on legal affairs, JURI, will be voting on several amendments to this mammoth bill which threaten to turn IP infringement from a civil offence into a criminal one. Your MEP needs to know now why this is a bad idea.

The FFII are calling IPRED2 “The Prosecution Paradise Directive”:

“All over Europe piracy and counterfeiting of ‘intellectual property rights’ are already prosecutable (TRIPS art 61). The Criminal Measures IP Directive adds disproportionality. The European Commission proposal is not limited to piracy. All commercial scale infringements will be crimes, the proposal criminalises IPR disputes that are essentially of a civil nature and occur between legitimate commercial enterprises. Even untested rights, which may soon evaporate in a civil court cases, become grounds for prosecution. And the rights holders may assist the police.”

The Open Rights Group has written this letter to all the UK MEPs sitting on JURI to express its concern at the proposed directive.

But we need your help too. Please take some time to write to your European representatives and let them know your personal concerns. You can find out who your MEPs are at WriteToThem.

There’s a lot about IPRED2 to object to (and even a little bit to encourage) in the proposed directive. If you focus on one issue and explain how it affects you, your MEP is much more likely to sit up and listen. Keep your letters succinct and polite and if you can, back up what you’re saying with clear references – the FFII IPRED2 website has lists of external opinions and background information, as well as analysis of each of the proposed amendments, which should get you started.

Remember, MEPs, like MPs, are unlikely to appreciate or respond to copy-and-pasted form letters, so please take the time to put down your concerns in your own words. Ask your MEP to forward your concerns to Nicola Zingaretti, the JURI rapporteur, or to their closest JURI colleague.

IPRED2 will criminalise “infringements on a commercial scale”. But what does this actually mean? Amendment 43 says this means “any infringement of an intellectual property right committed to obtain direct or indirect economic or commercial advantage; but excludes acts carried out by private users for personal purposes not centred on profit”. This definition is too broad. Here are some approaches to this issue you might like to consider.

• The law could criminalise the 35 million Europeans who, according to a report by Forrester research published in February 2004, have downloaded music from filesharing services.
• It could criminalise professional investigative journalists who may sometimes have to infringe copyright in order to bring important information to the attention of the public.
• It could criminalise the owners of websites where users provide the content

Alternatively, you might like to write to your MEP in support of Amendments 72 and 74, which ask for a fair use provision to ensure that people who use copyrighted work for teaching, news reporting, research or criticism are not criminalised.

Whatever you choose to write, please let us know if your MEP responds.

The Gowers Review, commissioned by the government to look at intellectual property law in the United Kingdom, published its final report today. It was commissioned by the Chancellor of the Exchequer Gordon Brown MP so it is expected that the report will hold a lot of weight and that its recommendations will be followed. We are delighted to see an evidence-based approach to reviewing Intellectual Property, and welcome many of the recommendations he makes, some of which we actively lobbied for. The report is 142 pages long so if you don’t have time to read it all, here are some points of interest. (This expands on our earlier press release).

• No extension of copyright term
• Exceptions to copyright
• A private copying exception
• Look into orphan works
• No expansion of software patents
• The possibility of a labelling convention for DRM
• Easier methods for complaints relating to DRM
• Stronger enforcement of IP law
• Fast track registration for trade marks, and Community Patent Review

No extension of copyright term

The music industry lobbied hard to extend the term of copyright for audio recordings. As regular readers will know, we lobbied hard against this happening, and we would like to thank every one who helped us on this as the report recommends that the term of copyright protection for sound recordings remain at 50 years. There is no doubt that this is the right decision - it is supported by all the evidence. But the Government must stand firm in the face of renewed industry attempts to marginalise the Gowers Review.

Matt Black, DJ and one half of Coldcut, said:

“The only people to benefit from term extension would be the giant traditional media groups - artists would actually benefit more from letting music enter the public domain. Extending copyright term for past works amounts to revising the deals made with artists without their consent. Who would sign a deal for a term of ‘50 years or however long we want to make it by lobbying to get the law changed’?

“The conclusion of the Gowers review that copyright term should not be extended is the correct one; we should not follow the lead of the US who have submitted to corporate demands by Big Media. Here we can recognise that music is a key part of our culture, (and, indeed, a key export), that recycling is a natural part of musical creativity and that not extending the existing copyright term will promote the creation of UK music.”

Exceptions to copyright

Calls for additional exemptions to copyright law for “creative, transformative* or derivative works” and for “caricature, parody or pastiche” will be important to both artists and the public alike. We are pleased to hear that libraries will be supported in their preservation work and will be allowed to copy and reformat copyrighted material, including film and sound recordings. This is essential to the health of our cultural heritage and we are delighted that the Chancellor has recognised its importance.

A private copying exception

A recommendation that private users be allowed to copy music from a CD to their MP3 player. When ever I mention this is a conversation I normally get a wonderfully confused look followed by the comment “What, I thought that was legal.” It still currently not legal in the UK, that is until this recommendation if followed and the law is amended.

Back in February when the Open Rights Group was presenting evidence to the All Party Internet Group, Ian Brown said

I am always astonished when I speak at events like this that it is only a small number of lawyers who know copyright law who even realise there is not a private copy exemption in British law. I am sure if you went home and talked to friends and family very few would realise they were breaking copyright law by making copies of their own CDs, for example.

Look into orphan works

The term ‘orphan work’ is used to describe a situation where the owner of a copyright work cannot be identified by someone else who wishes to use the work. Estimates suggest that only 2 per cent of all works that are protected by copyright are commercially available. In 1930, 10,027 books were published in the USA, but by 2001 all but 174 were out of print.77 The British Library estimates 40 per cent of all print works are orphan works.

Recommendation 13: Propose a provision for orphan works to the European Commission, amending Directive 2001/29/EC.

Gowers Report

No expansion of software patents

The Review supports the current position on pure software patents, business method patents and gene patents, highlighting the considerable costs and the negative effects that the USA has experienced where multiple owners each have a right to exclude others, and no-one in effect has the right to develop anything.

Recommendation 17: Maintain policy of not extending patent rights beyond their present limits within the areas of software, business methods and genes.

Gowers Report

The possibility of a labelling convention for DRM

This follows on from the All Party Internet Groups recommendations. The logic behind it is simple, let the market decide if it wants DRM or not, the market only works when the customers know what they are buying, so if there was a simple labelling system for DRM that informed the users that a product has DRM and what restrictions that DRM will enforce, customers can make informed decisions. This will be a very effective way of discouraging DRM. In the event that companies use DRM to create market power, damage users’ software or invade their privacy, the Review recommends that the Office of Fair Trading undertakes investigations.

Recommendation 16: DTI should investigate the possibility of providing consumer guidance on DRM systems through a labelling convention without imposing unnecessary regulatory burdens.

Gowers Report

Easier methods for complaints relating to DRM

DRM often prevents legitimate uses users from doing perfectly legal things. This often means that DRM breaks UK law. For example, the Royal National Institute for the Blind note that Adobe eBooks usually have ‘accessibility’ settings disabled. This prevents the visually impaired exercising their rights to make copies in accordance with the exceptions introduced by the Copyright (Visually Impaired Persons) Act 2002.85 Such exceptions ought to be respected by technology.

In theory any user could make a complaint but as there is no easy way to do so. The Review recommends that the procedures in place for circumventing DRM to allow copying for uses deemed legitimate under copyright exceptions ought to be made easier.

Recommendation 15: Make it easier for users to file notice of complaints procedures relating to Digital Rights Management tools by providing an accessible web interface on the Patent Office website by 2008.

Gowers Report

Stronger enforcement of IP law

This review is the most important critique of intellectual property in the UK of recent years, and we are delighted to see that the majority of its recommendations are sensible and constructive. We welcome the Chancellor’s commitment to tackling counterfeiting and piracy. However, we are concerned that the report seems to make no distinction between large-scale commercial counterfeiting, and small-scale non-commercial acts carried out by individuals. Too often these vastly different acts are conflated by the music industry, and the drafters of any new intellectual property law must make the difference clear to both the courts and the rights holders.

We are concerned that without this clarification, this report will give a green light to the record industry to continue to pursue frivolous court cases. If the police become involved in infringement investigations, as recommended by the Gowers Review, there is a risk that their resources would be diverted from tackling serious crime by an over-enthusiastic music industry keen to prosecute grannies and children for file sharing.

We would urge the Chancellor and to commission an independent study into file sharing, as it is clear that much more research is needed in order to determine how file sharing should be treated legally. Impartial evidence must form the foundation for policy in this area, rather than biased and unreliable information provided by interested parties.

Fast track registration for trade marks

By allowing trademarks to be fast-tracked, Gowers is adopting a more web-like process of comment and review to take place. Taking this together with the recommendation for a Community Patent Review pilot, Gowers is moving some way towards a web-like model of knowledge creation.

Recommendation 25b: The Patent Office should conduct a pilot of Beth Noveck’s Community Patent Review in 2007 in the UK to determine whether this would have a positive impact on the quality of the patent stock.

Recommendation 25b: Introduce fast track registration for trade marks.

The Review proposes that a fast track system (in addition to the normal system) should be available to allow for trade marks to be examined and accepted within 10 days of the application being filed. Once the application is accepted it can be published and thereafter the 3-month opposition period would begin. This fast track system should be accompanied by a higher fee.

Gowers Report

The Court of Appeal has ruled on two cases involving software patents today. It rejected one and unfortunately granted the other. It was hoped that the ruling would confirm that software development which relates only to new business logic does not have to worry about patent threats. As more and more companies in the United States get tied up in business method patent litigation, this decision should be a worry for UK companies. The full ruling is here, for those of you that are really keen. If you want some more details or are a member of the press I recommend you check out the FFII’s comments on the Court of Appeal Judgement in Macrossan and Aerotel.

These two cases are of vital interest to anyone concerned with the ongoing debate over the patentability of software and business methods in the UK and Europe. Both of the cases at issue concern patents in the area of software and business methods and so the appeal presented a historic opportunity for the UK courts to reaffirm the clear exclusion of these areas from the scope of patentability as well as to send an important signal to legislators and patent officials at the European level. It has not done so.

Aerotel’s patent that was granted today claims the making of telephone calls using prepayments. The essential idea is to have a telephone exchange which keeps a record of clients’ credit. Clients can then dial into the exchange, and have their calls completed for as long as they have credit to pay for them.

Why are these cases so important? High Court decisions do not establish binding precedents on other High Court cases, but decisions by the Court of Appeal do bind lower courts. Today’s decision is the first time the Court of Appeal have ruled on software and business method patentability since 1997, and gives a definitive statement of the UK law in this area.

Both patents do not contain anything novel except new administrative or business logic, with solely administrative and business consequences. At stake was not only the Court of Appeal’s decision, but how it decides it. We will be looking closely at these rulings and posting again to provide you more information.

Macrossan’s patent application was rejected by the UK Patent Office. In the High Court, Macrossan appealed against this rejection, but the appeal was dismissed by Judge Mann, finding that although not specifically a business method, it was a method of performing a mental act by a computer. It has been described by one software contractor as an absolutely conventional “fill-in-the-blanks website that picks the right docs based on guided answers, then fills them in appropriately and disgorges them wherever required”. The only new idea was to apply this to the documents needed to incorporate a company. Quite rightly this patent was rejected today on appeal.

The European Patent Litigation Agreement (blogged by us as Software Patents - back like a bad smell) remains on course to pass the European Parliament (EP) with a comfortable majority. Although the proposed legislation will not by itself bring Software Patents into our legal system, as it stands the legislation gives powers to the European Patent Court (EPC) which will lead to the enforcement of Software Patents in Britain and across the EU. Our best means to oppose this development is to write letters to our MEPs, informing them of the many reasons why we continue to reject Software Patents, and asking them to support a number of amendments to the EPLA.

For further information on these amendments, ffii have published What’s Happening and What You Can Do together with a detailed summary of current situation. Also, if you want further advice for your letter, there are usually at least two ffii activists working in the Parliament to support EPLA-critical efforts, who you can contact by writing to europarl-help at ffii org
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More than a year has passed since the European Parliament’s historic rejection of the Commission’s and Council’s software patent bill. Now this zombie legislation is shambling through parliament again: on October 11 or 12, the EP is set to vote in Brussels on two competing motions for a resolution on future European patent policy. Next week, internal market commissioner McCreevy will speak in the EP in Strasbourg and outline his patent policy plans, which have already come under fire.

The European Patent Litigation Agreement would impose an integrated judicial system and appeals process across Europe. It would do this by taking the power to rule on patents from national courts and putting it into the hands of a court made up of European Patent Office (EPO) members. This is really just a cunning way of making software patents enforceable across Europe. The law as it stands now states that software patents are illegal in Europe, but the EPO tends to ignore that and grant patents for software anyway. This has not been much of a problem as they are unenforceable — whenever someone tried to enforce these patents they had to do so in an particular national court. These courts would then say ‘you cannot patent software’ and rule against them.

Commissioner McCreevy proclaimed blissful ignorance about the consequences of the European Patent Litigation Agreement. In a series of six non-answers to Members of the European Parliament, the Commission failed to comment on cost, judicial independence, jurisprudence and treaty-related concerns. Meanwhile McCreevy keeps praising the virtues of said draft agreement.

A joint proposal of three groups — PES, Greens/EFA and GUE/NGL — calls for “balance between the interests of patent holders and the broader public interest in innovation and competitive markets”. The motion criticizes McCreevy’s preferred measure, the European Patent Litigation Agreement, for weakening EU democracy, compromising judicial independence, increasing litigation costs and “exposing SMEs [small and medium-sized enterprises] to greater risks”. The proposal also warns against the effect the European Patent Litigation Agreement would have on the scope of patentable subject-matter, and a decision of the European Patent Office to uphold a Microsoft software patent (on clipboard data formats) is mentioned as an example.

The European Commission has been consulting on the future of Europe’s patent regime and, as always, the FFII have been doing a good job of monitoring their progress. Fears that this was a third attempt to legalise software patents in Europe prompted a large number of SMEs, software developers and bigger IT firms to respond, but it seems that the Commission did not like the answers they got:

The Commission made an undercover move to get more “useful” answers following the 12 April closing date of its Patent Policy consultation. It sought out small firms across Europe who had used the patent system. It then provided these firms with new documentation and specialist assistance to help them write individual answers. None of the firms answering the online consultation got this help. But when the software firms in this new group came to the same conclusions as the FFII, the Commission concluded that these firms were “lacking knowledge about the patent system”.

Commission Cheats European SMEs in Patent Consultation - FFII