Former RIAA Lawyer At DOJ Will Only Avoid RIAA Issues For A Year

from the ethics? dept

Plenty of folks have noted that the Justice Department has been the landing place for a number of RIAA lawyers. Some have suggested not to get too worked up about this, given that the Obama administration's ethics rules supposedly forbade those lawyers from being involved in issues related to their former work. However, it looks like the limit on these guys is actually quite narrow and for a very short period of time. We'd already noted that the highest ranking former RIAA lawyer, Thomas Perrelli, in his Senate confirmation hearings, said he hoped to use his position to increase intellectual property enforcement from within the Justice Department.

Now, Pro Publica, an online investigative reporting operation, has published the ethics agreements signed by Obama administration appointees, including Tom Perrelli's agreement, which appears to only preclude him from working on issues that impact his former clients for one year. Also, it seems pretty narrowly focused on the specific clients he worked for, but not other aspects of the same industry. In other words, in less than a year, he can certainly start helping the RIAA from within the Justice Department -- and his Senate testimony suggests he's interested in doing so. That's not quite the ethical separation we were led to believe would exist in the administration.

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Will The RIAA's New Friends In Justice Get Involved Over Constitutionality Of RIAA Damage Awards?

from the we're-about-to-find-out dept

In one of the many cases out there challenging the constitutionality of statutory fines for copyright infringement, there's some indication that the Justice Department is considering intervening on the side of the record labels to defend fines that range from $750 to $150,000 for sharing a single song that can be purchased for $1. There are numerous arguments (both legal and common sense) for why the punishment here goes way beyond the crime. But, with the Justice Department hiring a bunch of the entertainment industry's favorite lawyers into high level positions, this seems like a pretty clear conflict of interest. Many people are now suggesting contacting the administration and requesting that it not intervene in the case given the conflicts of interest.

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Justice Department Increasingly Looking Like The RIAA/MPAA's Legal Team

from the change-the-riaa-can-believe-in dept

It seems that the Obama administration is basically hiring the entire RIAA/MPAA/BSA legal team these days. It started off with the RIAA's favorite lawyer, then it hired the BSA's antipiracy enforcer, and now it's brought on two more of the entertainment industry's favorite lawyers, including Don Verrilli, who was one of the main guys arguing the entertainment industry's side in the infamous (and terribly decided) Grokster case. He also was the guy who argued the RIAA's case that the Jammie Thomas verdict shouldn't be thrown out (on that one, he lost, thankfully). Of course, if you're thinking things would have been any better had McCain won, just note that one of his legal advisors is gleefully cheering on these appointments. Still, as Ray Beckerman notes, Obama's own rules should preclude these guys working on issues related to those they used to represent. We'll see if that actually happens, though.

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DOJ Gets Another Copyright Cop

from the not-looking-good dept

Among the tech community, there was some belief that the Obama administration understood some of the key issues, such as the damage done by draconian copyright laws -- and they had shown that with the way they went about running their campaign. However, there's an increasing realization that the techies on the campaign are entirely separate from the policy people now involved in the administration. First there was the appointment of one of the RIAA's top lawyers as associate attorney general, and now comes news that Neil MacBride, the BSA's antipiracy enforcer, has also been appointed to a high level role in the Justice Department.

You may recall MacBride, because last year, right before the BSA released its usual entirely bogus stats on the impact of piracy, he was kind enough to call me and walk through why he stood by those numbers. In that post, you can see some of how MacBride approached these issues -- insisting that piracy represents a real loss, not a business model issue, and even suggesting that it's all a generational thing. This is somewhat worrisome, as I believe it's the wrong approach to understanding what an impact copyright issues have on business, society and culture. That two such individuals are now in high level positions in the Justice Department does not bode well at all for the idea that we may have more reasonable copyright policy and enforcement coming out of the Justice Department any time soon.

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DOJ Was Three Hours From Suing Google For Antitrust Violations

from the pick-your-fights dept

It was pretty clear back in September, when the Justice Department hired well-known antitrust litigator Sandy Litvack, that it had decided that it was going to file an antitrust lawsuit against Google, even if there were serious questions about what harm its ad deal with Yahoo would actually cause. Despite plenty of negotiation and totally rewriting the deal, the Justice Department was set on opposing it, leading Google to give up.

Now, that litigator, Sandy Litvack has admitted that the Justice Department was three hours away from filing its antitrust suit, which he was "looking forward to" and he's apparently disappointed he didn't get to go to court over it. That seems troublesome. If the purpose of antitrust activity is to protect consumers, then its litigators should be pretty happy that it avoided a (taxpayer-funded) legal battle.

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Justice Department May Have Just Killed Yahoo; Google Drops Partnership

from the you-wanted-less-competition,-you-got-it dept

Well, apparently even the greatly scaled back version of their ad partnership wasn't enough to appease a Justice Department intent on suing Google for antitrust no matter what the real issues are. Google had previously threatened to kill the deal if the Justice Department didn't ease up on its position, so it really shouldn't come as a surprise to anyone that Google has now dropped out of the deal entirely.

The government is still insisting that it would have represented a monopoly, as around 90% of the "relevant market" would have been managed by one company. First of all, they were only looking at the search ad market, which is hardly the relevant market. Advertising budgets pay for much more than search ads, and if search ads really became more expensive, it would only open up opportunities for alternative means of advertising. Besides, there was still little to no indication that any such deal would increase advertising fees. Given Google's auction based system, and the fact that this would increase inventory, there's plenty of reason to believe it would actually decrease advertising costs.

In the end, killing off this deal may represent a pretty big blow to Yahoo's chances of moving forward as an independent concern. The company was very much relying on the Google deal to stabilize its financial condition. Without that, Yahoo is in trouble -- meaning there's probably a good chance that Microsoft takes another look at acquiring the company for much, much less than before. That means, Yahoo as we know it, disappears. Considering the Justice Department wanted more competition rather than less, it's unfortunate that it's misguided decision is effectively killing off one of the competitors.

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Justice Department Says It Doesn't Want To Be Hollywood's Police Force; Senate Removes That Provision

from the good-for-them dept

This doesn't come as a total surprise, because the Bush Administration had said something similar last year about the House's ProIP bill, but the Justice Department has come out very strongly against Senator Leahy's proposed bill that would let the Justice Department take on civil copyright lawsuits, effectively becoming Hollywood's private enforcement agency. What's impressive is how much of the argument seems to mimic the EFF's concerns:

We strongly oppose Title I of the bill, which not only authorizes the Attorney General to pursue civil remedies for copyright infringement, but to secure "restitution" damages and remit them to the private owners of infringed copyrights. First, civil copyright enforcement has always been the responsibility and prerogative of private copyright holders, and U.S. law already provides them with effective legal tools to protect their rights....

Second, Title 1's departure from the settled framework above could result in Department of Justice prosecutors serving as pro bono lawyers for private copyright holders regardless of their resources. In effect, taxpayer-supported Department lawyers would pursue lawsuits for copyright holders, with monetary recovery going to industry.

Third, the Department of Justice has limited resources to dedicate to particular issues, and civil enforcement actions would occur at the expense of criminal actions, which only the Department of Justice may bring. In an era of fiscal responsibility, the resources of the Department of Justice should be used for the public benefit, not on behalf of particular industries that can avail themselves of the existing civil enforcement provisions.

The "good" news is that this statement has apparently convinced the Senate to remove that part of the bill. Senator Ron Wyden introduced an amendment that took out the part where the White House gets to handle civil cases, but the rest of the bill still moves forward (and don't be surprised to see future efforts push to get the Justice Department back in on private enforcement).

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Will The DOJ's Interpretation Of Email Privacy Make It Difficult To Prosecute Palin Email Hacker?

from the we-said-what-now? dept

While plenty of folks are talking about the cracking of Sarah Palin's personal email account, the EFF is noting that the Justice Department's own interpretation of email privacy laws may actually make it difficult to prosecute the hacker under the most obvious statute, the Stored Communications Act. You see, since the DOJ would prefer that your email not be considered private, it has interpreted emails that you've opened, but not deleted, as not being subject to the SCA. That's thanks to a somewhat contorted reading of the law that suggests that an opened email is no longer considered either in temporary or intermediate storage -- nor is it considered saved for backup purposes. Those happen to be the two requirements under the law. Thus, if the hacker accessed emails that Palin had already read, the DOJ may have trouble using the SCA, since its own statements (though, thankfully, not the courts) seem to believe that hacking in and reading already read emails is not covered by the law.

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Is The Justice Dep't Really Thinking About Going After All Of Google's Business On Antitrust?

from the political-extortion dept

We've been somewhat confused by the talk of an antitrust action against Google for its ad deal with Yahoo (which doesn't seem likely to raise prices despite what critics say). However, it's become increasingly clear that the gov't is very likely going to move ahead with this. As we already noted, the Justice Dep't has already hired a well-known outside attorney to lead the charge. It seems unlikely that they would do that if they weren't planning to make a big splash. Plus, news is spreading that the Justice Department is already sharing info on its case with California's Attorney General and potentially other state Attorneys General as well.

Now comes the news that the Justice Department isn't just thinking about stopping the ad deal between Yahoo and Google, but in going after Google in general as a monopolist. This is positively ridiculous, and is clearly politically motivated and funded by companies who simply don't like Google. Yet, nowhere has there been any evidence that Google's size has been used to abuse pricing power or to make things more expensive for consumers. Rather, almost everything it's done has been to make things easier or cheaper for consumers.

Unfortunately, it appears that in this politically motivated world, where Google didn't "play the game," a bunch of politicians and Justice Department officials want to charge Google with the crime of "being too successful." Honestly, that's about all they seem likely to have on the company, because it's hard to see how it's abused its monopoly power in a way that actually harms consumers or prevents competition from entering the market.

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Groups Urge Senate Not To Turn The Justice Department Into Hollywood's Private Police Force

from the bad,-bad,-bad-ideas dept

As we noted earlier this summer, Senator Patrick Leahy had introduced a companion bill to the House's dreadful Pro-IP bill, except that Leahy's bill went further. Beyond just adding a "Copyright Czar" position to the White House, it would authorize the Justice Department to start prosecuting civil copyright infringement lawsuits. In other words, it would have the government act as the private police for of the entertainment industry. This is scary stuff. Beyond already handing out unnecessary gov't granted monopolies, the gov't would now be using taxpayer money to settle business disputes from an industry that was only in trouble because it stubbornly refused to update its business model.

It's difficult to see why taxpayers should be paying FBI agents to protect one industry's obsolete business model.

A bunch of special interest groups made that argument to Senators this week, noting that it was a pure gift to Hollywood -- pointing out that all of the companies and groups in the industry already have their own enforcement arms, and it made little sense to have the FBI take part in private business disputes. Hopefully, there are still enough Senators who haven't been convinced by the propaganda provided by the entertainment industry on this issue to recognize what's actually at stake here.

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Will A Google/Yahoo Ad Deal Really Impact Ad Prices?

from the not-so-clear dept

The Association of National Advertisers (ANA) has sent a letter to the Justice Department opposing Yahoo's plan to hand much of its search advertising over to Google. We've already explained some reasons why this combination shouldn't set off antitrust alarms, but the reasons given by the ANA don't make much sense. It claims that the deal would basically mean that one company would control 90% of the market, which would lead to increased prices for advertisers. However, that doesn't necessarily seem true to follow -- because Google doesn't set prices for ads. Google's ad system is, famously, an auction system where the prices are set by the market. So it's difficult to see why the inclusion of Yahoo's ad inventory would significantly raise the prices -- unless the argument is that the market is artificially depressed right now, and this would just raise it to the proper levels. However, apparently, that might not matter much, as reports are coming out that the Justice Department has already hired a big time antitrust lawyer to use against Google. This is increasingly looking like a political attack on a company that is "big" rather than looking to see if its success actually harms or helps consumers.

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DOJ Finally Approves XM-Sirius Merger

from the took-'em-long-enough dept

It only took over a year of ridiculous protests from traditional radio stations, but the Justice Department has finally decided that XM and Sirius can merge without creating a monopoly. It will be interesting to see if the NAB's own lobbying efforts helped disprove its point. The NAB, representing terrestrial radio stations argued vehemently that if XM and Sirius merged, it would create a "monopoly." The only problem with that statement is that if that were the case, it would mean that terrestrial radio wasn't competing in the same market. And, if that were true, why would the NAB care? So, by arguing so vehemently against the merger, it effectively showed what we all knew: terrestrial radio and satellite radio compete in the same market. Of course, the merger isn't a done deal yet, as the FCC still needs to weigh in. But given the amount of time it has already taken for the DoJ to make its decision, you would hope that the FCC was at least close to being done with its review as well. Update: No surprise here, the NAB is "astonished" by the decision.

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Major Labels Under Antitrust Investigation

from the yet-again dept

Apparently the Justice Department is suddenly worried that the four major record labels are colluding in creating a new online music subscription service. The last time this happened was back when the record labels tried to (wait, this sounds familiar) create online music subscription services -- which were universally panned, rarely used and eventually shut down. So, even if the labels are colluding, given their strategic vision, it seems rather unlikely that they're going to leverage their position to dominate the market. They certainly could hold back other services -- but it seems like they've been doing that for years already, just with their own shortsightedness.

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Justice Department Comes Out Against PRO-IP, While Howard Berman Complains That It's Not Strong Enough

from the compare-and-contrast dept

We've made no secret of how ridiculous we think the new "Pro-IP" bill is. If anything, it's actually anti-IP. Surprisingly, it appears that the Justice Department actually agrees. In hearings on Thursday about the bill, the Justice Department slammed the bill as unnecessary and counterproductive. That's a bit of a shift from the DOJ's point of view under former Attorney General Alberto Gonzales, who started pitching ridiculous IP legislation to have something to talk about other than the controversy surrounding everything else he was doing. Of course, the real reason why the DOJ is against it appears to be that they don't want enforcing copyright laws to be taken away from the DOJ itself, which would happen if the bill becomes law and an "IP Czar" position is created within the Whitehouse.

Of course, not everyone feels that way. Howard Berman, affectionately known as the Representative from Disney, who really should not be in charge of the intellectual property subcommittee, spent some time at those same hearings to suggest that the PRO IP bill doesn't go far enough, and it's time to get rid of the DMCA's safe harbor provisions. Yes, he wants to take about the only reasonable part of the DMCA and get rid of it. Safe harbors for service providers make perfect sense. They make sure that third party tool and service providers aren't held liable for the actions of their users. It's about making sure that companies can't just blame whoever is biggest or easiest to serve with a lawsuit -- but those actually responsible for breaking the law. Berman wants to get rid of those safe harbors, of course, because the entertainment industry hates them. Safe harbors mean they can't get away with, say, suing YouTube for $1 billion, which is much easier than adapting to a changing market place. Berman has always insisted that he's not just pushing Hollywood's perspective, but it's hard to see how that's the case when he makes statements like this.

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Senators Ask Justice Department To Become Hollywood's Private Enforcement Agency

from the the-gov't-works-for-hollywood dept

In 2004, Senator Orrin Hatch introduced the Pirate Act, which would allow the Justice Department to go after people for file sharing in civil cases. Civil cases, of course, are between two private entities, rather than the gov't and a person. In other words, the government shouldn't be a part of it at all. Just because the legacy entertainment industry can't figure out a new business model, it doesn't mean they should be able to use the FBI and the rest of the Justice Department to enforce their old business model. Even folks in the Justice Department thought it was a bad idea, as they had no desire to be Hollywood's private enforcement arm. Luckily, that bill died off, and we thought it was all gone... until Senators Patrick Leahy and John Cornyn brought it back to life on Wednesday, introducing a very similar bill, also called the Pirate Act, which again would task the Justice Department with handling the entertainment industry's civil cases. It's difficult to see how anyone can justify having the Justice Department act to prop up the obsolete business models of a single industry, but that's exactly what's happening. Not surprisingly, the RIAA and the MPAA are thrilled to find out that your tax dollars may go towards artificially keeping their business model on life support.

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