Answers Prepared by Marybeth Peters
The Register of Copyrights
submitted to the
Subcommittee on Courts and Intellectual Property
Committee on the Judiciary
United States House of Representatives
104th Congress, 2nd Session
February 15, 1996
National Information Infrastructure Copyright Protection Act (H.R. 2441, and
February 15, 1996
The Honorable Carlos J. Moorhead
Chairman, Subcommittee on Courts
and Intellectual Property
B351A Rayburn House Office Building
Washington, DC 20515-0527
Dear Mr. Chairman:
I am pleased to provide the following answers to your written
questions concerning your bill, H.R. 2441, and S. 1284, the
National Information Infrastructure Copyright Protection Act. In my
November 15th testimony, I indicated an intent to submit to the
Subcommittee an additional statement covering issues not
specifically addressed in the proposed legislation. Since your
questions cover the issues we intended to address in that
submission, we submit these answers in lieu of a second statement.
Broadcasters have contacted me requesting an exemption in these bills
so that their broadcasts are not confused with the digital transmissions covered
in the bill. What is your recommendation?
Answer: The Copyright Office does not believe that such an
exemption is necessary at this time. The bills would amend the distribution
right to clarify that the distribution of copies of a work to the public may
be accomplished by means of transmission. Based on current technology, this
would not cover broadcasts any more than present law does, since a broadcast
does not result in copies being distributed to the public. If the technology
were to change so that this is no longer the case, the appropriateness of an
exemption for broadcasts might have to be examined,depending on the nature of
the uses of works being made by the broadcasting industry at that time.
Could a "browser" be held statutorily liable without downloading a
copyrighted work under these bills? What about a third party who does not decode
copyright protection devices to access a work but accesses a work without knowledge
that it has been decoded by another party?
Answer: These bills do not affect the liability of browsers.
Under current copyright law,depending on the scope of his or her activities,
a "browser" could in theory be held liable even if he or she did not download
a copyrighted work. Courts have held that the copying of a work into a computer's
random access memory ("RAM"), which occurs automatically when the work is transmitted
from another computer, can in itself infringe the copyright owner's reproduction
right. Accordingly, if the "browsing" involves the browser receiving a transmission
of all or a substantial portion of a work in order to view it on his or her
computer screen, without the consent of the copyright owner, the conduct is
likely to constitute a prima facie case of infringement. The term "browsing,"
however, is an ambiguous term, and could involve various types of conduct. Depending
on the circumstances, some types of "browsing" may qualify as fair use.
Some argue that the act of "browsing" should never constitute
infringement. The issue of what types of browsing should lead to
liability is a policy question that may deserve further attention.
At present, however, there has been no indication of problems
having arisen, and the bills do not contain any provisions that
would alter current law. We note that the market place may
satisfactorily resolve many of the issues involved without the need
for government intervention; already services exist that make clips
of copyrighted works available to consumers at no cost.
As to a third party who accesses a work without knowledge that
it has been decoded by someone else, he or she may be liable for
copyright infringement under current law if the work is protected
by copyright and access is gained without permission. He or she
would not be liable, however, for violation of section 1201 of the
bills (the so-called "black box" provision). Only a person who
engages in an act of importing, manufacturing or distributing one
of the devices outlawed by that section, or who offers or performs
a service outlawed by that section,could be held liable for its
Some issues left unaddressed by this legislation may be equally important
as the ones that are addressed. Which issues do you believe are ripe for consideration
at this point in time and which do you feel should wait until a more in-depth
study of the copyright system as a whole is conducted?
Answer: The bills in their current form address the most
pressing issues raised by existing digital technology. They clarify the law
so as to provide greater certainty, and they provide important safeguards for
the technology and licensing information that copyright owners will need to
rely on in making their works available on the NII.
At this point in time, the issue of on-line service provider
liability may also be ripe for consideration. The Copyright
Office's views on this issue are set forth in our answer to
Question (8) below.
Those issues that can appropriately await a more in-depth
study of the copyright system as a whole include: (1) whether the
copyright owner's exclusive rights, and the exemptions available to
users, should be formulated in a way that is less format- and
technology-specific;(2) whether the existing categories of
copyrightable works should be maintained; and (3) how to define the
essential distinction between public and private uses.
What role do you envision the "fair use" doctrine playing as the NII
develops? Are there any changes Congress should consider in Section 107? How
can fair use be meaningfully implemented in the digital networked environment?
Answer: Today, the fair use doctrine plays a critical role
in calibrating an appropriate balance between the rights of copyright owners
and the interests of users of copyrighted works. It modifies the grant of private
ownership rights by allowing certain beneficial and reasonable uses of works
without the copyright owner's consent. Fair use should continue to play this
critical role in the digital environment, both today and as technology evolves
in the future.
The Copyright Office believes that Congress should not
consider making any changes in section 107 at this time. Section
107, which represents a statutory formulation of the judicially
developed doctrine of fair use, is the most flexible,
forward-looking and technology-neutral provision of the Copyright
Act. It articulates in statutory language broad and general
principles of reasonableness, public benefit and potential harm,
allowing them to be weighed in light of the circumstances of each
case. Its language and concepts apply equally well to all types of
uses of all types of works.
The questions posed for fair use in the digital environment
are therefore not a problem of statutory language, but relate
instead to judicial interpretation of the doctrine in the differing
environment of digital communications, and to the ability to take
advantage of the fair use privilege in an encrypted digital world.
If courts prove unable to adapt prior case law inappropriate ways,
or if as a practical matter fair use is substantially diminished in
its application because licensing practices do not develop in a
flexible enough direction, then Congress may need to respond in the
future. At present, however, we do not see the existence of any
problems that require a legislative solution.
Fair use may meaningfully be implemented in the digital
environment in a number of ways. First, consensual guidelines may
be adopted that will allow certain uses without payment. For the
past year and a half, ongoing discussions have been held among
interested parties to work toward this goal. Even without such
guidelines, copyright owners may voluntarily allow access to their
works on-line for fair use purposes. License or access fee
structures may be developed that will take into account the
proportion of total uses that qualify as fair use. Finally, as the
White Paper suggests, certain acts of decryption may be excused if
the ultimate purpose is to make fair use of the work.
Will the digital importation right be difficult to enforce
as a practical matter due to the fact the Customs Service can not stop a digital
transmission? Will the right have any value to the copyright owner? How will
it add anything meaningful to existing rights?
Answer: The digital importation right probably
will not be able to be enforced in the same way that the importation right is
enforced today in the context of tangible copies. As practical matter, Customs
cannot monitor digital transmissions as the electronic signals pass U.S. borders.
But this does not mean that the right will have no value. First, it has an important
theoretical justification, since the importation right is part of the distribution
right and should therefore parallel its scope, covering all methods by which
a work may be distributed to the public. In addition, there are circumstances
where the copyright owner may be able to rely on the importation right in proceeding
against an infringer. If, for example, someone engages in an ongoing business
involving the unauthorized transmission of copyrighted works from abroad,the
copyright owner could obtain an injunction against this continued conduct and/or
damages for the past infringements. This would be an option even if the person
engaging in the unauthorized importation was not violating the reproduction
right by making unauthorized copies of the works within the United States.
An op-ed in the November 13 Washington Times stated that
"the White Paper is an astoundingly radical measure which makes reading a document
on the screen of your Web browser a copyright violation, cuts those you cannot
afford to 'license' information off from the information highway and dramatically
restricts the 'fair use' of copyrighted material." How do you respond to these
Answer: It is important to distinguish between
the White Paper, produced by the Working Group on Intellectual Property Rights
of the Administration's National Information Infrastructure TaskForce, and the
bills that are pending before Congress. While the pending bills contain legislative
proposals suggested in the White Paper, and supported by its legal analysis,
the bills stand on their own and do not incorporate the White Paper's analysis
as such. As discussed in our answers to questions (2) and (4) above, the proposed
legislation does not affect in any way the legal status of "reading a document
on the screen of [one's] Web browser," the availability of access to the information
highway, or the scope of application of the fair use doctrine. These are important
issues, and will doubtless be the subject of continuing debate over the coming
months and years, but the bills are narrowly drafted to address only a few specific
concerns. The Copyright Office assumes that this will be confirmed by the legislative
history to the bills as eventually enacted.
As to the White Paper discussion, while there may be room for
reasonable disagreement over particular characterizations or
conclusions, it is difficult to see how it can be called
"astoundingly radical." The report summarizes the current state of
the law, and concludes that few changes are necessary to adapt
copyright to current digital technology.
In particular, to address the points quoted from the
Washington Times op-ed piece: The White Paper notes, accurately,
that retrieving a copyrighted work over a digital network entails
the creation of a copy of the work under current technology, and
that the prevailing legal interpretation today holds that such a
copy implicates the copyright owner's exclusive right to reproduce
the work. (It does not suggest that the act of reading itself
constitutes infringement.) Just as with a traditional use of a
copyrighted work, the White Paper indicates that the copyright
owner's consent will generally be required when a copy of the work
is retrieved electronically,and may be conditioned upon payment of
a license fee. The assertion that access to copyrighted works may
require payment reflects fundamental principles of copyright law,
and is hardly a radical position. Finally, the White Paper
describes the existing parameters of the fair use doctrine as
established by Congress and the courts, and concludes, "It is
reasonable to expect that courts would approach claims of fair use
in the context of the NII just as they do in 'traditional
environments.'" White Paper at 80. It proposes no legislative
change, let alone a"dramatic restrict[ion]," but notes that the
Working Group had convened a conference of interested parties who
have met on a regular basis in an attempt to negotiate consensual
guidelines for fair use in the digital environment.
The Caucus on Intellectual Property of the Conference on
College Composition and Communication states that if these bills are passed
in their present form, it would destroy the gains teachers have made in using
the Internet and the World Wide Web as education resources because it would
discourage the common practice of "browsing" and would make universities liable
for students' copyright infringement. How do you respond?
Answer: Again, as discussed in our answer to Question (2),
the bills in their present form do not alter the current legal status of "browsing."
Browsing on the Internet today may entail the making of copies of works without
authorization. Accordingly, to the extent that such use of works by teachers
and students has not been challenged by copyright owners, perhaps because it
is not economically significant or because it may qualify as fair use, passage
of the legislation should not lead to more challenges. Nor do the bills contain
anything that would shift liability from students to universities. If the universities
are not liable under current law, they will not be liable under the proposed
Some groups have reacted negatively to these bills due to
a perceived chilling effect resulting from on-line service provider liability.
Currently, there are no such provisions for such liability in the bill, but
they are discussed in the White Paper. What is the current state of the law
regarding on-line service provider liability? How do you think Congress should
deal with the issue of on-line service provider liability?
Answer: Given the degree of concern that has been expressed about
the potential liability of on-line service providers, this is an issue that
should be considered seriously. At the same time, however, since the bills in
their current form do not implicate this issue in any way and therefore would
not prejudice its resolution, it would be possible to move ahead with the pending
legislation and deal with on-line service provider liability separately.
The Copyright Office believes that the White Paper fairly and
accurately sets forth the current state of the law in this area.
In addressing the responsibility of businesses engaged in bringing
infringing works to the public, the courts have developed doctrines
of contributory infringement and vicarious liability to supplement
the potential direct infringement that may occur through acts of
distribution and public performance or display. The White Paper
describes the evolution and essential elements of these doctrines.
While some argue that various lines of the case law are inapposite
due to factual distinctions between the role of on-line service
providers and other types of middlemen in the distribution chain,
we agree with the Working Group that the concepts of existing law
on their face apply to many of the activities of on-line
The White Paper concludes that a case has not yet been made
for varying these rules and treating on-line service providers
differently. Since the White Paper was issued, a number of
arguments have been put forward in an attempt to make that case.
In particular, it has been pointed out that the sheer volume and
speed of transmissions made through on-line services differentiate
those services from traditional publishing, and may make it
impossible to monitor the content of the transmissions in a
meaningful way (particularly where the transmissions have been
encrypted). Further examination of the evidence in this respect
may establish the need for some type of special legislative
We note, however, that any chilling effect that may result
from existing doctrines of contributory and vicarious liability so
far appears to be slight. On-line service providers entered the
business with these doctrines already established in the law, and
have been thriving under the current legal regime. There has not
been an explosion of litigation, and the few cases that have been
decided appear reasonable given their facts. In fact, the most
recent case on the subject, containing the most thoughtful judicial
analysis of the issues to date, is in many respects quite favorable
to the interests of on-line service providers. Religious
Technology Center v. Netcom On-Line Communications Services, Inc.,
907 F. Supp. 1361 (N.D. Cal. 1995). It therefore seems appropriate
to place the burden on the providers to establish their need for
special treatment, and to confine any such special treatment to
those activities for which it is necessary.
Any legislation shielding on-line service providers from
liability should not be absolute,but should be calibrated
carefully. The question is, what protection is reasonable, given
the range of activities being engaged in? At any given time, is
the service provider performing a function more analogous to a
traditional publisher, or more analogous to a common carrier?
Inappropriate circumstances, it might be advisable to establish a
safe harbor, allowing service providers to function efficiently
without fear of liability if they observe certain precautions and
follow prescribed procedures.
If Congress decides to adopt this approach, we suggest caution
in two respects when formulating the terms of the safe harbor.
First, it is critical that copyright owners not be required to take
particular steps to notify service providers of their claims as a
condition to being able to sue. Such requirements are likely to be
considered formalities imposed on the enforcement of rights, which
are prohibited under the Berne Convention for the Protection of
Literary and Artistic Works, to which the United States is a
signatory. Second, care should betaken not to create perverse
incentives, by rewarding the deliberate avoidance of knowledge of
In the event that on-line service providers are able to
establish a need for special treatment, the Copyright Office
believes that these concerns can be accommodated and a reasonable
solution found. We would be pleased to work with Congress and the
interested parties to assist in the process.
How will clarifying copyright protection in the digital networked
environment help small business and start-up companies? Do you think there is
a danger that these changes will mostly help big copyright industries? How will
they affect individual authors, artists and other creators?
Answer: Copyright owners as a group will
be helped across the board by the proposed legislation. This group includes
individual authors, artists and other creators, as well as small businesses
and start-up companies. Anyone who creates a work of any type or dimension,
or pays for its creation, or purchases a copyright, can be a copyright owner,
and therefore has a stake in ensuring that his or her rights can be adequately
protected and enforced on the NII. To the extent that big copyright industries
may be helped more than individual owners and small companies, the difference
will be entirely proportional, based on the fact that they may own a larger
number of works. As to each particular work, the benefit should be the same.
Every copyright owner will benefit from the increased certainty from a clarification
of rights in the digital environment, as well as from the provision of legal
protection for technological device she or she may use to guard against unauthorized
copying and for the integrity of the information he or she chooses to provide
about terms and conditions of access to the work.
Does this legislation create any new exclusive rights for
the benefit of copyright owners? Does it expand any of the exceptions to protection
or create new ones to benefit users?
Answer: The Copyright Office does not interpret
the legislation to create any new exclusive copyright rights for the benefit
of copyright owners (as opposed to creating new enforcement mechanisms). Rather,
in our view, it clarifies existing law in various respects in order to avoid
ambiguity about the scope of the distribution right. The bills simply make clear
that the copyright owner's right to control the distribution of copies of the
work to the public extends to distribution by any means, including digital transmission.
Whatever the means used, the end result is the same: members of the public receive
copies of the work.
On the other side of the balance, the legislation expands one
of the existing exceptions and also creates a new one. It expands
the section 108 exception for libraries to allow the creation of
copies in digital form for preservation purposes, and to increase
the number of permissible copies from one to three. It creates a
new section 108A for the benefit of the"visually impaired,"
allowing non-profit organizations to reproduce and distribute
copies of literary works to them at cost, in a form that they can
In sum, the legislation maintains the fundamental balance
struck by existing law, while adding to the privileges available to
users for certain beneficial purposes.
Technology can be used to protect information and the same
technology can be used to destroy these protections. The legislation addresses
this by outlawing technologies which have as their primary purpose the picking
of these electronic locks that copyright owners might use to protect their property.
The Software Publishing Association put out a press release today stating that
they feel that the "primary purpose test" is too burdensome and that the sanctions
provided are not harsh enough. Others insist that the provisions are too harsh
and violate privacy rights. How do you react to these arguments?
Answer: At the November 15 hearing, the Copyright
Office supported the concept of outlawing devices or services that defeat copyright
protection systems. However, we voiced some concerns about the breadth of proposed
section 1201, in particular the "primary purpose or effect" test. As our testimony
reflects, we agree that this standard may be too burdensome in some respects,
but also believe it may be over broad in its coverage, potentially sweeping
legitimate business behavior within its prohibition. With respect to the sanctions,
we did note the inconsistency of omitting any criminal penalty, in light of
the criminal penalties provided for violation of the copyright management information
provision in section 1202.
Since our testimony was prepared, we have heard fears
expressed that encryption systems will violate rights of privacy
because they will require the development of a mechanism for the
tracking of every use of a particular work, together with a system
for charging individuals for each such use. There is concern that
a database will be developed that tracks the reading habits of
every American. These fears are legitimate, but misplaced.
Section 1201 does not mandate or affect the development of such
systems; their development will depend on the private marketplace.
Already today, works are being encrypted; with or without these
bills, copyright management systems will proliferate. The
long-term challenge, apart from copyright considerations, will be
to ensure that they do so in a way that is consistent with privacy
In conclusion, we believe that the language of the bill should
be narrowed in certain respects in order better to define the
prohibited conduct. Some of the concerns that have been expressed
may appropriately be addressed by legislative history.
Why are the provisions in these bills on copyright management
information so important? How do you envision these provisions working on the
Answer: The Copyright Office believes that
the easy availability of information about the authorship, ownership and licensing
terms of works will be critical to the success of the global information society.
On July 14, 1993, the Library of Congress held a conference on the topic of
"Delivering Electronic Information in a Knowledge-Based Democracy"; all who
participated agreed that effective and efficient systems for copyright clearances
and payments were necessary.
If obtaining accurate copyright management information is
difficult, unauthorized uses may abound. The Copyright Office is
therefore trying to assist in solving this problem by developing an
electronic registration and recordation system with a rights
management component that will allow such information to be
collected and disseminated electronically. The Copyright Office is
also sponsoring with the Interactive Multimedia Association an
intersector/interindustry forum to identify requirements for
technology-based intellectual property management in an advanced
information infrastructure. The all-day conference, which will
beheld on March 7th in Crystal City, Virginia, will look at the
principal approaches to developing open and distributed management
systems and services, and will survey practices and plans for
identifying, labeling and registering works.
A critical aspect of any such system is ensuring that the
system is accurate and secure. It is in everyone's interest, both
owners and users of copyrighted material, to be able to rely on the
information provided to facilitate identification and licensing.
Therefore, the provisions of section 1202 are extremely important.
If the scope of copyright holders' rights is clarified, should
we also clarify the scope of the exemptions from those rights to ensure that
the balance between owners and user is maintained?
Answer: Congress should act to clarify only
those aspects of the copyright law as to which there is a need for clarification.
Since questions have been raised by some as to whether digital transmissions
of works fall within the scope of the copyright owner's exclusive distribution
right,we believe it is advisable to amend the portions of the Copyright Act
that relate to this issue: the distribution right itself in section 106; the
definitions of "publication" and "transmit" in section 101; and the importation
right in section 602. This is what is proposed by the pending bills.
In the view of the Copyright Office, it is not automatically
necessary to amend the exceptions every time an amendment is made
to the copyright owner's rights. In each case, the question is
whether the scope of the rights has been changed to such an extent
that a corresponding change is needed in order to preserve the
fundamental balance of interests reflected in the copyright law.
The proposed clarification of the coverage of the distribution
right will not in and of itself change that balance. Accordingly,
unless a specific related ambiguity is identified in one or more of
the exceptions contained in sections 107 through 120,no amendment
to those exceptions appears to be necessary at the present time.
Should the one-year waiting period be eliminated for the
exemption for the visually handicapped? Why or why not?
Answer: In our testimony on November 15,
the Copyright Office opposed the one-year waiting period proposed in the exemption
for the visually handicapped. We stated that the waiting period would significantly
reduce the value of the exemption, noting that the blind and other persons with
disabilities have a legitimate need for prompt and timely access as soon as
possible after works become available to the general reading public. For many
works, notably textbooks, access would be provided too late to be of real benefit
to eligible readers.
Since the November 15th hearing, the Copyright Office has
continued to work with the various interested parties. We are
pleased that they have achieved consensus; a substitute proposal
endorsed by all interested parties, which ensures that access is
immediate rather than delayed, has been submitted to Congress.
If, as a result of section 1201, it becomes impossible to
gain access to copyrighted works on the NII without the copyright owner's authorization,
have we seriously shifted the balance of rights? Can we separate enforcement
from the existence of rights in a digital environment?
Answer: In examining this question, it is
important to recognize that copyright law has never provided any guarantee of
access to protected works. In fact, one of the fundamental rights of a copyright
owner is the right of first publication--the right to determine when, whether,
and on what terms a work is to be made available to the public. See Harper
& Row Publishers, Inc. v. Nation Enterprises, 471 U.S. 539 (1985).
By outlawing the circumvention of copy protection devices,
section 1201 is the electronic equivalent of making it illegal to
break into a locked room to gain access to a copyrighted work. Like
laws aimed at breaking and entering, this section is an enforcement
tool, rather than a shift in the underlying balance of rights in
the work itself.
In addition, the intent behind the provision is to limit its
prohibition to situations where the ultimate acts made possible by
the circumvention are themselves unlawful. The language has been
drafted so as to apply only where the system being circumvented
prevents or inhibits the violation of copyright, and only where the
act of circumvention is done "without the authority of the
copyright owner or the law." In other words, the intent is to
allow someone to"break and enter" if the result is primarily to
make a fair use or an otherwise privileged use, or to gain access
to works in the public domain.
It is true that section 1201 is a particularly strong and
effective enforcement tool, which may prevent or inhibit the
development and sale of devices that may be used for both
legitimate and illegitimate means. The Copyright Office believes,
however, that the general concept of the section is an important
step toward ensuring that copyright rights remain meaningful
despite the speed, ease and accuracy of multiple copying in the
digital networked environment. Without such a provision, many
copyright owners will be reluctant to take the risk of making their
works available on the NII. The specific language of section 1201
as drafted is a reasonable first step in attempting to find a
balance between this critical goal and the desire to maintain
leeway for legitimate interests in access. As we indicated in our
written submission of November 15, we have some concerns about the
breadth of this language, and recommend that it be modified in
various respects. Nevertheless, there is no perfect solution, and
we believe that the general thrust of section 1201 represents an
appropriate compromise of the interests involved.
Finally, we note that the NII is not likely to be the only
source of access to works,whether they are protected by copyright
or not; traditional sources such as retail stores, theaters and
libraries will continue to co-exist with digital databases. For
this reason too, the specter of an entirely encrypted world seems
Should section 1202, which protects the integrity of copyright
management information, be harmonized with existing section 506, which does
the same thing for copyright notices? If so, how would you propose to accomplish
Answer: As stated in our prior testimony,
the Copyright Office agrees that the proposed section 1202, which safeguards
the integrity of copyright management information, should be harmonized with
provisions in section 506 of the Copyright Act applying to statements made in
applications for copyright registration and to information provided in notices
We suggest deleting these provisions in section 506 and adding
their coverage to section 1202. Thus, the scope of the provisions
in section 1202 would be expanded to include information in
copyright notices and representations made in applications for
registration. This solution has the advantages of including in one
location in the statute all provisions dealing with the accuracy of
copyright-related information, and ensuring consistency in
definitions and penalties.
Applying the first sale doctrine in the NII and GII environment
may be problematic. Proposals to amend the first sale doctrine in the digital
context to allow the transmission of a reproduction so long as the transferor
destroys the original may not be appropriate. The first sale doctrine does not
allow a purchaser of a book to photocopy it, burn it and transfer the photocopy.
Is it possible transfer an original in the digital environment without simultaneously
making an infringing copy? If it is possible, do you believe that the first
sale doctrine should be limited in the digital context for the same reasons
that it was limited in 17 U.S.C Section 109(b)(1)(A)(Supp. 1995)?
Answer: The Copyright Office agrees that
the first sale doctrine does not transfer easily to the digital environment.
The doctrine is based on the premise that an existing copy is transferred from
one person to another, with no additional copy of the work created. When a work
is transmitted digitally from one computer to another, the original copy remains
in the memory of the transmitter's computer, with another copy made in the memory
of the recipient's. Thus, the first sale doctrine would not privilege the transmission.
We also agree that simply requiring the original to be
destroyed does not result in an entirely equivalent situation.
First, the destruction requires an affirmative act, which may not
always take place, and will be hard to prove or disprove. Second,
the potential to interfere with the copyright owner's market is
much greater. In a transfer involving a tangible copy, there has
been a single act of reproduction, for which the copyright owner
has received recompense. The transfer requires a physical
activity, entailing some inconvenience, similar to visiting the
bookstore. In addition, the physical copy is no longer new, making
it less valuable or appealing in certain respects. In the on-line
world, in contrast, the transmission can take place
instantaneously, there can be multiple transmissions from a single
transferor, the quality of the copy remains equivalent, and the
recipient need not leave home to obtain it.
The ultimate question is therefore not whether the first sale
doctrine applies to digital transmissions, but whether an
equivalent to the first sale doctrine should be crafted. The
Copyright Office believes that the answer must turn on a
determination that such a new exception is needed to further the
policies behind the first sale doctrine, and that it can be
implemented without substantial detriment to the copyright owner's
market. Of course, even if no new exception is crafted, the first
sale doctrine will continue to exist, applying to transfers of
tangible copies as this form of exploitation continues
simultaneously with the exploitation of works by digital
The first sale doctrine was developed to avoid restraints on the
alienation of physical property, and to prevent publishers from
controlling not only initial sales of physical copies of
works, but the after-market for resales. See M. Nimmer & D.
Nimmer, Nimmer on Copyright Section 8.12 [A] (1993). These
concerns do not apply to transmissions of works on the NII and GII.
Moreover, it is likely to be relatively simpler and less expensive
for the second user to obtain an authorized copy over the NII than
to purchase a new tangible copy.
In light of the facts that digital transmissions do not
implicate the core policies behind the first sale doctrine, that no
hardship to users has been demonstrated, and that it may not be
possible to craft an equivalent exception for transmissions without
significantly impairing the copyright owner's market for exploiting
the work through digital networks, the Copyright Office recommends
no change in the law at this time.
Register of Copyrights