link to: 10:23 [GMT-6]

• From the land of truly nerd-like sausages, the Supreme Court has just granted certiorari (agreed to hear) Reed Elsevier, et al., v. Muchnick, et al., petition No. 08–103 (from this misguided opinion from the Second Circuit). Here's the question for review, written by the Court itself (not unheard of, by any means, but not the normal practice, either):

  Does 17 U.S.C. § 411(a) restrict the subject matter jurisdiction of the federal courts over copyright infringement actions?

  This is the class-action lawsuit regarding electronic databases of magazine articles. The Second Circuit threw out the settlement, continuing to assert that § 411(a) of the 1976 Act goes to subject-matter jurisdiction of the federal courts, and that the proposed settlement was defective because it was outside the jurisdiction of the federal courts. Section 411(a) is the one that requires issuance of a certificate of registration by the Registrar of Copyrights before a lawsuit alleging infringement may "be instituted."

  Under the 1909 Act — and caselaw under the 1909 Act that the Second Circuit, and the Seventh Circuit by implication, have relied upon in deeming § 411 jurisdictional — registration and copyright were identical: There was no copyright without registration. Thus, it is clearly correct to say that the equivalent section of the 1909 Act was jurisdictional, as without a copyright there was no federal question. The 1976 Act changed that; now a certificate is merely an administrative formality, not the copyright itself. Is that enough to be "jurisdictional," though, particularly in the face of the US accession to the Berne Convention (which denigrates "formalities" as a prerequisite to "enjoying the benefits" of a copyright)?

  I think not, as I've made clear over time; I'm in the minority, however. At last, though, this will be heard. IMNSHO, registration is an element of the claim, not a jurisdictional prerequisite. That may not sound like a big difference, but it really is, for three reasons that I'm just going to soundbite at you. The first — and the reason it matters in this case — is that one can settle a claim that isn't complete, but one can't settle a claim over which the court has no jurisdiction. The second is that a correct interpretation insulates authors from the failure of their agents (the legal term, not literary agents) to perform an administrative formality (whether this might lead to a cause of action for the forfeited attorney's fees against a publisher is an interesting side issue...). The third is that by demoting the matter to an element of a claim, it actually supports the position of persons who do not wish to have particular works enforced under copyright law, and offers the equivalent of a disclaimer of copyright that is not possible when it is treated as a question of jurisdiction... because a failure of jurisdiction ordinarily implies that some other court has jurisdiction, not that the claim fails.

  My prediction is that this is actually going to turn on a series of ERISA cases and how they have delineated what is necessary to be "subject matter jurisdiction" more than it will on copyright law. That is, it's a matter for civil procedure nerds more than Hollywood/Nashville grandstanding. I predict that Justices Stevens and Ginsburg will find it nonjurisdictional; that Justice Breyer will find it jurisdictional; that Justice Kennedy will find a non-civil-procedure way to vote; and that the rest of the votes are up for grabs. In short, there is no clear majority going in on this one.

  It's too late for this Term's argument calendar, so expect a decision by the end of June 2010.

• Today's sausage variety comes from Casimir Pulaski. Illinois has a long history of enshrining Casimir Pulaski Day as a state holiday, in preference to (for a while) MLK day... quite probably because Casimir Pulaski not only has a major street named after him in Chicago (running near Midway Airport), but he has living descendants in the second-largest Polish city in the world.
• Here's a really foul-smelling-and-tasting sausage: Rush Limbaugh as the Beloved Leader of the GOP. Or you can just listen to the music (embedded on the right... as is appropriate).
• What part of "monopsony"¹ do the FTC and DOJ not understand? I'd guess all of it... as Random House is apparently being allowed to gobble up another competitor. And not exactly a pathetic one, either; the publishing-industry version of asset-stripping won't be far behind.
• Meanwhile, another player in the publishing monopsony wants to reevaluate the nature — not to mention price — of e-books. On a "new, improved" Kindle, no doubt... and assuming that publishers necessarily control the e-book rights. What was that about "monopsony" again? And the rents from restricted competition in the industry?² Of course, that actually represents (even in the UK, the source of the report) mostly figures from sales in late 2007 and early 2008, thanks to the slovenly pace of financial reporting (and payment) in publishing.
• Any zombie could have told you why your brain is not anything like a computer: Chips, wiring, and circuit boards are too difficult to chew with decaying teeth. Once computers go all organic, though, will they become zombie-fare again? Might this be a potential solution to the starvation problems in East Zombor? Might I need a lot more caffeine to be coherent?
• There really is an honest financial consultant out there — one who actually admits (in print) that he probably doesn't know what he's talking about.

1. In technical terms, a "monopoly" largely concerns a concentrated seller with lots of central buyers, that therefore can control the price and nature of goods and services available to the public by restricting output, unfair pricing tactics, refusals to deal, and so on. A "monopsony" arises from the converse case: a concentrated buyer (or middleman) with lots of potential sellers, that therefore can control the price and nature of goods and services available to the public by restricting input, unfair pricing tactics, refusals to deal, and so on. See generally, e.g., Roger D. Blair & Jeffrey L. Harrison, Monopsony: Antitrust Law and Economics (1993). The regulatory authorities have a rather complex, formulaic system for determining whether a monopoly requires scrutiny under antitrust law, called the HHI. They simply assume that the HHI works equally for monopolies and monopsonies... but it's trivial to demonstrate that it doesn't, either mathematically or in practice. Cf. "New Yorker Fiction Editor Sees Recession Submission Boom" at GalleyCat from last Friday.
2. Remember, in economic terms a "rent" is not "the amount I pay the landlord on the first of the month for my apartment" — it is the excess profit earned through use (and ordinarily abuse) of a dominant market position. Sometimes it's merely "use," as technically any profit from a patent, copyright, or trademark — legally sanctioned monopolies — is a "rent."

   If you get the impression that I've been working on that article on the economic structure of IP exploitation again, you're right.

Labels: copyright, intellectual property, jurisprudence, mass media, miscellany, politics, publishing