Filing 116

TRANSCRIPT OF 9/12/16 MOTIONS HEARING, before Judge Tanya S. Chutkan, held on September 12, 2016. Page Numbers: 1-142. Date of Issuance: 10/13/16. Court Reporter: Bryan A. Wayne. Transcripts may be ordered by submitting the #Transcript Order FormFor the first 90 days after this filing date, the transcript may be viewed at the courthouse at a public terminal or purchased from the court reporter referenced above. After 90 days, t he transcript may be accessed via PACER. Other transcript formats, (multi-page, condensed, CD or ASCII) may be purchased from the court reporter.NOTICE RE REDACTION OF TRANSCRIPTS: The parties have twenty-one days to file with the court and the court reporter any request to redact personal identifiers from this transcript. If no such requests are filed, the transcript will be made available to the public via PACER without redaction after 90 days. The policy, which includes the five personal identifiers specifically covered, is located on our website at Redaction Request due 11/3/2016. Redacted Transcript Deadline set for 11/13/2016. Release of Transcript Restriction set for 1/11/2017.(Wayne, Bryan)

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1 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA AMERICAN SOCIETY FOR TESTING AND MATERIALS, et al., . . . . Plaintiffs, . . v. . . PUBLIC.RESOURCE.ORG, INC., . . Defendant. . . . . . . . . . . . . . . . .. . AMERICAN EDUCATIONAL . RESEARCH ASSOCIATION, INC., . et al., . . Plaintiffs, . . v. . . PUBLIC.RESOURCE.ORG, INC., . . Defendant. . . . . . . . . . . . . . . . .. CA No. 13-1215 (TSC) CA No. 14-0857 (TSC) Washington, D.C. Monday, September 12, 2016 9:12 a.m. TRANSCRIPT OF MOTIONS HEARING BEFORE THE HONORABLE TANYA S. CHUTKAN UNITED STATES DISTRICT JUDGE APPEARANCES: For Plaintiff ASTM: J. KEVIN FEE, ESQ. JORDANA S. RUBEL, ESQ. Morgan, Lewis & Bockius, LLP 1111 Pennsylvania Avenue, NW Washington, D.C. 20004 (202) 739-3000 For Plaintiff NFPA: KELLY KLAUS, ESQ. ROSE L. EHLER, ESQ. Munger, Tolles & Olson, LLP 560 Mission Street, 27th Floor San Francisco, California 94105 (415) 512-4000 2 For Plaintiff ASHRAE: JOSEPH R. WETZEL, ESQ. J. BLAKE CUNNINGHAM, ESQ. King & Spalding, LLP 101 2nd Street, Suite 2300 San Francisco, California 94105 (415) 318-1200 For Plaintiffs AERA, APA, NCME: JONATHAN HUDIS, ESQ. NIKIA L. GRAY, ESQ. Quarles & Brady, LLP 1701 Pennsylvania Avenue, NW Suite 700 Washington, D.C. 20006 (202) 372-9600 For Defendant CORYNNE MCSHERRY, ESQ. MITCHELL L. STOLTZ, ESQ. Electronic Frontier Foundation 815 Eddy Street San Francisco, California 94109 (415) 436-9333 ANDREW P. BRIDGES, ESQ. MATTHEW B. BECKER, ESQ. Fenwick & West, LLP 555 California Street San Francisco, California 94104 (415) 875-2300 DAVID E. HALPERIN, ESQ. 1530 P Street, NW 1st Floor Washington, D.C. 20005 (202) 905-3434 Court Reporter: BRYAN A. WAYNE, RPR, CRR U.S. Courthouse, Room 4704-A 333 Constitution Avenue, NW Washington, DC 20001 (202) 354-3186 Proceedings reported by stenotype shorthand. Transcript produced by computer-aided transcription. 3 1 2 P R O C E E D I N G S THE DEPUTY CLERK: Your Honor, this is civil case 3 13-1215, American Society for Testing and Materials, et al., 4 versus, Incorporated; and civil case 14-857, 5 American Educational Research Association, Inc., et al., versus 6, Incorporated. 7 8 9 Counsel, please come forward and state your appearance for the record. MR. FEE: Good morning, Your Honor. Kevin Fee on 10 behalf of ASTM International. I'm joined at counsel table by 11 Jordana Rubel, and we also have general counsel of ASTM in the 12 back, Mr. Tom O'Brien. 13 THE COURT: Good morning. 14 MR. KLAUS: Good morning, Your Honor. I'm Kelly Klaus 15 from Munger, Tolles & Olson representing the National Fire 16 Protection Association. 17 colleague, Rose Ehler. 18 also in the audience this morning. 19 THE COURT: 20 MR. WETZEL: I'm joined at counsel table by my Our general counsel, Sally Everett, is Good morning. Good morning, Your Honor. Joe Wetzel 21 from King & Spalding on behalf of ASHRAE, and I'm joined by 22 Blake Cunningham from my firm at counsel table. 23 THE COURT: Good morning. And, counsel, I'm going to 24 ask you, when you come up to argue, for you to restate your 25 name, just because there's so many of you, for my court 4 1 2 reporter. MR. HUDIS: Good morning, Your Honor. Jonathan Hudis 3 for the plaintiffs in the 14-857 case. 4 and sitting in the audience is immediate past general counsel, 5 Nathalie Gilfoyle, and current general counsel, Deanna Ottaviano. 6 THE COURT: 7 MS. MCSHERRY: With me is Nikia Gray, Good morning. Good morning, Your Honor. 8 Corynne McSherry for, and with me at the 9 counsel table is Andrew Bridges, my co-counsel who will also be 10 arguing part of the case, the bulk of the issues, to be honest. 11 He took that all on. 12 Becker of Fenwick & West; Mitch Stoltz, with me from the 13 Electronic Frontier Foundation; and David Halperin. 14 THE COURT: Also with me at counsel table is Matt Good morning, everyone. I know that the 15 parties had wanted more time; and I've given them less time than 16 they wanted, but I'm confident, having been through the 17 materials, that we can accomplish everything we need to 18 accomplish today. 19 I'm just going to ask that you be mindful of probably one 20 of the more important people in this room, which is my court 21 reporter, Mr. Wayne, who has to get all this down. 22 to ask you, again, announce yourselves when you come up to the 23 podium and to speak clearly and not too quickly, something I 24 have to remind myself of as well. 25 MR. HUDIS: So I'm going Your Honor, in light of the reduced time, 5 1 we gave your clerk our proposal for scheduled arguments. 2 3 THE COURT: All right. I saw that. That's fine. So let's get right on it. I have some 4 questions, obviously, but I will raise them when it seems 5 appropriate as you're in your argument. 6 going to deal with copyright issues. 7 So it looks like we're ASTM is going first. Is that you, Mr. Klaus. 8 MR. KLAUS: Yes. Kelly Klaus representing NFPA 9 and speaking on behalf of all the plaintiffs in the ASTM case 10 on the copyright issues other than ownership, Your Honor, and 11 being mindful of time, I'll keep my own clock out and try to 12 watch. 13 THE COURT: All right. 14 MR. KLAUS: I told Mr. Hudis that I would try to 15 roughly hew to his schedule. I also told him that if I happen 16 to go over by a few minutes, we're happy to take time off of 17 other things on the back end. 18 THE COURT: All right. 19 MR. KLAUS: But we'll try to keep it there. 20 Your Honor, as you noted, you have a mountain of paper 21 that's been presented to you, and we appreciate the Court's 22 patience in reviewing all of it notwithstanding the numerous 23 materials that are here. 24 25 This is, we think, a very straightforward case of copyright infringement. There are numerous works that have certificates 6 1 of registration that come with the presumption of ownership and 2 validity, and we have a defendant who is engaged in wholesale, 3 100 percent, verbatim exercise of multiple of the exclusive 4 rights of copyright. 5 he voluntarily stopped, pending resolution of these issues 6 before Your Honor, unrestricted distribution of these works. 7 It has engaged in unrestricted, and until I'd like to cover -- there are numerous copyright issues 8 other than ownership in the case, and numerous cases. 9 to cover three broad areas, and I'm happy, Your Honor, to 10 I'd like address, of course, all the questions that you have on these. 11 But the three areas, first, are that we think this is a 12 clear case where Congress -- this is a case of congressional 13 intent, ultimately, and this is a case where we think Congress 14 has spoken and that the Copyright Act makes clear that the works 15 in question are copyrighted and do not lose their copyright 16 protection simply because they are incorporated by reference. 17 The second is, I'd like to address the split in the case 18 law which is at the center of the dispute, really, between the 19 Veeck case from the Fifth Circuit -- 20 THE COURT: And I'm sorry. Just for Mr. Wayne's 21 purposes, Veeck is spelled V-e-e-c-k, and there's one other 22 phrase that's going to probably come up that I had to consult my 23 French-speaking husband for, which is scènes à faire, which is 24 s-c-e-n-e-s a f-a-i-r-e. 25 Okay. So those are just for the transcript. 7 1 MR. KLAUS: Thank you, Your Honor. And the split 2 between the Veeck case on the one hand and the Ninth and Second 3 Circuit cases, that subsumes within it a number of issues 4 including merger and the idea-expression dichotomy. 5 The third issue that I'd like to cover briefly is the fair- 6 use defense that's been raised and why we think that that can be 7 resolved as a matter of law now. 8 Your Honor, we think that ultimately, turning to the first 9 point, this is really a question of what did Congress intend in 10 the Copyright Act. 11 the other side that have a lot of rhetoric behind them in terms 12 of there being an impingement of due process rights, an 13 impingement of the right of people to speak or to think about 14 the law. 15 There are numerous arguments that we have on I would note a point that I will come back to several 16 times. 17 with discovery into numerous issues, there is absolutely no 18 evidence to back up any of the claims that anyone has ever been 19 deprived access to the standards in issue. 20 There is -- notwithstanding multiple years of litigation There's no evidence that anyone has been deprived of 21 their First Amendment right to speak, much less that those 22 constitutional claims could be asserted against the property 23 rights of the plaintiffs in this case who have their own 24 constitutional issues lurking in the background in the form of a 25 potential taking by state action that would appropriate their 8 1 2 property and their copyright. So you have constitutional avoidance questions that, at 3 best for the other side, cut in both directions, and really I 4 think ultimately counsel the Court back to the plain words and 5 the plain intent of the copyright statute. 6 Now, under § 102(a), it's plain that when the 7 underlying works are created, they meet all the standards for 8 copyrightability. 9 requirements that were laid out by the Supreme Court in the They are original. 10 Feist case. 11 They meet the original of creativity to them. 12 They certainly have much more than a minimal degree THE COURT: Mr. Klaus, does it matter if the standards 13 were created with anticipation or with the expectation that they 14 would be incorporated into law? 15 MR. KLAUS: No. 16 THE COURT: And why not? 17 MR. KLAUS: Because, first of all, what the evidence 18 actually shows is that that is -- and it's undisputed on behalf 19 of all the plaintiffs that the standards are used for multiple 20 purposes other than simply being created -- simply being enacted 21 into law. 22 used by people outside of simply a matter of legal compliance, 23 and those points are set forth in Mr. Thomas's declaration, 24 Mr. Pauley's declaration, and Mr. O'Brien's declaration. 25 And they in fact have numerous uses that they are So these are not standards that are solely, or as in the 9 1 hypothetical case that the defendant has raised, for example, a 2 K Street lobbyist who takes something to his or her favorite 3 legislator for no purpose other than to have that item enacted 4 into law. 5 such materials as there is copyright protection for these 6 materials. 7 completely different. 8 There's not a tradition of copyright protection for And the policy considerations, we'd say, are So we think the standards here were original in that they 9 have the minimum amount of creativity, they were not copied from 10 anywhere else, and there's nothing in the statute that says they 11 are not copyrightable when they are created. 12 To the extent that the statute speaks at all about 13 copyright protection for works that overlap with law, it's in 14 § 105 which says that works of the United States government, 15 meaning a work that's created or prepared by an officer or 16 employee of the United States in the course or scope of that 17 person's duties, are not subject to copyright protection. 18 Otherwise, nothing in the statute says that incorporation by 19 reference divests the standards of protection. 20 And we know from other legislation, Your Honor, specifically 21 the National Technology Transfer Advancement Act, NTTAA for short, 22 of 1995, specifically in 15 U.S.C. § 272(b)(3), specifically 23 expresses a preference for standards for federal agencies to 24 incorporate by reference. 25 There are a variety of policy reasons that underlie that, 10 1 but there is a recognition in that statute and in the continued 2 decisions of federal agencies, including the Office of the 3 Federal Register, including the Office of Management and Budget, 4 in our request for Judicial Notice No. 1, which is the Circular 5 A-119, that express a clear preference for federal agencies to 6 rely on voluntary consensus standards, numerous policy reasons 7 underlying that, numerous policy reasons that we think frankly 8 undercut a number of the parade of horribles of the lack of 9 transparency or accountability in government decision-making. 10 For example, the fact that voluntary consensus standards are 11 open to the public. 12 voluntary consensus standards. There's not a danger of industry capture of 13 And repeatedly, Public.Resource has made the same arguments 14 that it's making to this Court about the fact that incorporation 15 by reference necessarily divests the copyright to OMB, to the 16 Office of the Federal Register, and those arguments have been 17 repeatedly rejected. 18 19 Now, I'd like to turn, if I could, to the heart of the case law dispute. 20 THE COURT: Mr. Klaus, let me ask you or your clients, 21 are they currently for sale, the standards at issue in this 22 case? You currently sell the standards? 23 24 25 MR. KLAUS. Correct. The standards as we publish them? We do. THE COURT: Is there any objection to sell the 11 1 standards since they're incorporated by reference? 2 words, do you have to sell them? 3 MR. KLAUS: In other That's an interesting question as to 4 whether they would have to be sold. If this were a case where 5 some governmental body incorporated the standard by reference, 6 and if the standard-setting organization said we're not going to 7 sell them, that would be a -- not only would it be a very 8 different case; you would probably come closer, at least at a 9 minimum, on the fair-use case to something like, for example, 10 the Swatch case that the defendants cite, and that's the case 11 where the company didn't want -- they claimed copyright 12 protection over the transcript of its earnings recording. 13 it did that for the purpose of -- But 14 THE COURT: It's a close call. 15 MR. KLAUS: -- keeping it out of the public record. 16 And so what the interest of the copyright owner in that case was 17 trying to preserve had nothing to do with what the purposes of 18 copyright are. 19 THE COURT: But if you stopped selling the standards, 20 is it still reasonably available under the OFR's regulation, 21 especially if the regulation incorporating the standard by 22 reference says that it's available from the authorizing 23 organization? 24 25 MR. KLAUS: I think it would be a very hard case for me or for anyone else to make if the standards weren't 12 1 available. 2 3 THE COURT: Okay. I have another question, but I'm going to wait till you get to that. 4 MR. KLAUS: Sure. Let's talk briefly about the 5 distinction between the Veeck case and Practice Management and 6 the CCC case from the Second Circuit. 7 main argument that Public.Resource advances here, which is that 8 this Court should follow the majority opinion of the en banc 9 Fifth Circuit in the Veeck case. 10 Ultimately, that is the And I think it's important to emphasize at the outset of 11 this, Your Honor, there really are two lines of cases here. 12 There are two lines of cases that deal with the same issue. 13 There is a split of authority, and ultimately the Court has 14 to decide which one is the more persuasive of the two. 15 It's our position that the better reasoned cases, the cases 16 that are more sensitive to the precedent and to the policy 17 considerations here are Practice Management and CCC. 18 respect to Practice Management, that's the Ninth Circuit case 19 that involved the HCFA regulations that incorporated by 20 reference the AMA's CPT. 21 here. 22 With My apologies for all the acronyms In the Practice Management case, Your Honor -- first of 23 all, let's be very clear. Practice Management is not, as we 24 see some reference to it in the defendant's briefing and as 25 there were some references to it in the Veeck case trying to 13 1 distinguish it, a case about simply referring to some numbers 2 that the ABA published. 3 coding system that the AMA had, and the coding system -- There was a system that -- an entire 4 THE COURT: The AMA. 5 MR. KLAUS: AMA. 6 THE COURT: Okay. 7 MR. KLAUS: My apologies if I did. 8 9 10 11 12 I thought you said ABA. There are a lot of letters to keep up with. THE COURT: The ABA is not organized. (Laughter) MR. KLAUS: We may get a lot of stipulation for that, Your Honor. 13 THE COURT: All right. 14 MR. KLAUS: The AMA's standards were incorporated. 15 The Ninth Circuit said so explicitly in the opinion. 16 federal regulations that incorporated those by reference. 17 Someone who wanted to be reimbursed for expenditures that were 18 reimbursable under Medicare, Medicaid, had to use that system. 19 There is no difference between that and the types of standards 20 that are at issue here. 21 There were And as the Ninth Circuit said in that case, ultimately the 22 question, they said, boiled down to whether or not the Banks 23 case from the 1800s established some divestiture of copyright. 24 This is a major point of difference between the Ninth Circuit 25 and the Fifth Circuit. What the Ninth Circuit recognized about 14 1 Banks, we think correctly, is that Banks is a case that says, 2 for purposes of the copyright statute, judges aren't authors. 3 Judges, in the course and scope of the opinions that they 4 write -- we certainly know judges can and do create things 5 outside of what they do and get copyright, but in the course and 6 scope of writing opinions, it's not subject to copyright 7 protection. 8 9 THE COURT: No matter how celestial the prose. But let me ask you, didn't the Ninth Circuit, when they 10 looked at Banks, it focused on Banks' premise that there's a due 11 process premise in fair access to law. 12 in the Ninth Circuit considered the due process interest and 13 rejected it because of the fact that there was no evidence that 14 anyone wishing to use the copyrighted codes had any difficulty 15 obtaining access to it. It seemed that the Court 16 MR. KLAUS: Correct. 17 THE COURT: Is that what you're arguing here? 18 MR. KLAUS: That's the second ground that they 19 discussed, and that's also -- that's a point of departure with 20 the Veeck case. 21 at evidence of availability or accessibility. 22 front of us; we don't care. 23 continuous tradition which we would submit, respectfully, there 24 is no continuous tradition of standards incorporated by 25 reference not being protectable. The Veeck majority said, we don't want to look Don't put that in We read Banks as establishing a 15 1 But Practice Management does indeed say that accessibility, 2 that there is a due process consideration, and there's a 3 question that if somebody has to comply with a legal requirement, 4 can they have access to it. 5 Your Honor. 6 discovery and litigation, there is no evidence that anyone 7 who has needed to comply with any of the standards that the 8 plaintiffs in this case publish or that are at issue here, 9 there's no evidence here that anyone has ever had any problem 10 11 And this is very critical here, There is no evidence -- again, after years of gaining accessibility to any one of those standards. In fact, the standards are all made freely available online 12 in online reading rooms. 13 the particular requirement, they can go to the Internet and all 14 the standards are completely available. 15 evidence on the other side that there has been any problem of 16 accessibility. 17 18 19 THE COURT: So, if anyone wanted to know what is Again, not a shred of How do the standards here differ from the model codes that were at issue in Veeck? MR. KLAUS: Well, the standards that are at issue 20 here were not -- and this goes to a question. So, first of all, 21 with respect to Veeck, the language that's in the majority 22 opinion -- and it's important to focus this. 23 293 F.3d at page 805. 24 standards -- in the case of a model code, reading in the first 25 column, model code which the majority says is not protected by This is on page What the majority said here is that the 16 1 copyright, loses its copyright protection when it's incorporated. 2 The text of the model serves no other purpose than to become 3 law. 4 decided the case was to say that SBCCI, the acronym for the 5 plaintiff there, operates with the sole motive and purpose of 6 creating codes that will become obligatory law. 7 The characterization that the Court put on in the way it And in fact, at the end, what the Court says -- and the 8 Court says the result in this case would be different but 9 recognizes we're potentially creating a circuit split and this 10 is the way out, is to say that we will characterize these codes 11 as having no purpose other than having been enacted to become 12 positive law. 13 And here, Your Honor, the undisputed evidence is that 14 that's not the sole purpose that the plaintiffs enact the codes 15 for. 16 industry for purposes other than simply law, and there's not the 17 sole expectation that they will simply become law and simply be 18 incorporated and wholesale adopted. 19 The evidence is that they are in fact used by business and In fact, what the evidence actually shows -- and this is 20 discussed at length in the ICC, International Code Council 21 amicus brief, is that actually numerous of the standards, 22 including the standards at issue here, when they are 23 incorporated by reference, federal agencies, state agencies may 24 adopt a portion of them. 25 For example, in the Practice Management case itself, you'll 17 1 see there's a reference to my client's standard, the National 2 Electrical Code, and there's a citation to a particular federal 3 regulation that doesn't incorporate the entire thing by reference 4 but incorporates particular portions of it. 5 There are other jurisdictions that may incorporate and make 6 various changes and amendments to them, but it's not the 7 paradigm that you have referenced in the Veeck case, which is 8 something that is simply put forward solely for no other purpose 9 than to become law. 10 The other point of distinction between Practice Management 11 and CCC and the Veeck case that we think is important is Veeck 12 starts out by saying, here's a Supreme Court opinion in Banks. 13 We're not going to look at it just as a matter of statutory 14 construction. 15 and for all in the 1800s, that anything that's incorporated by 16 reference automatically becomes the uncopyrightable law, free to 17 all to use. 18 We're going to say this settled the matter once But there was a backup argument that the majority put in 19 which was, even if it doesn't, there's a merger. At the moment 20 that a standard is incorporated by reference, the fact merges 21 with whatever is capable of being the copyrightable expression. 22 And we see the merger argument raised by the defendant in this 23 case, and the merger argument, we think, was quite properly 24 rejected in Practice Management. 25 of merger is that, at the moment of creation, what was the As the court said, the point 18 1 constraint on the author? 2 THE COURT: Your argument is that the merger -- for 3 the merger doctrine to apply, the merger doctrine analysis takes 4 place at the instant of the work's creation. 5 MR. KLAUS: That's correct. And that's -- the most 6 recent exposition of this was in the federal circuit's decision 7 in the Oracle v. Google case which deals with computer software 8 which has its own, in some ways, sui generis copyright analysis. 9 But the important point there is the merger discussion isn't 10 limited there, and it's also -- you see it in the Practice 11 Management case. 12 The question of merger is, we don't want the very first 13 person who writes "roses are red, violets are blue" to have 14 a copyright on the saying that roses are red. 15 taking that idea out there and removing it from circulation 16 because there are a minimal number of ways that any author could 17 have expressed that expression. 18 THE COURT: 19 That is simply So there has to be no other ways of articulating a particular idea when the work is first published. 20 MR. KLAUS: That's correct. And we know in this 21 case -- the record is clear in our case that, in fact, there are 22 other organizations who create standards on the same topics 23 here. 24 38 and 133 by way of example on that. 25 there is no constraint on any of the organizations here in terms I'd refer Your Honor to our statement of undisputed facts There's no dispute that 19 1 of their authorship, in terms of the types of creative, 2 expressive choices that they would have to make at the moment 3 of creation. 4 Practice Management, at 121 F.3d at page 520 in footnote 8, 5 specifically says this is the reason why we are not going to 6 apply the merger doctrine here. 7 Second Circuit in the CCC case is to the same effect, 44 F.3d at 8 72. 9 and we will decide how and when to apply it depending on what Judge Leval's opinion for the What he says is merger is a judicially created doctrine, 10 are the needs to leave the breathing room for creativity and 11 expression. 12 Just in the last few minutes that I'm going to try to take 13 for my time, Your Honor, let me talk about fair use, and the 14 main points I'd like to make on fair use are that the use here, 15 however it's described, is -- and whatever the purposes that are 16 claimed, is plainly substitutional. 17 engaged in the business of making wholesale copies, distributing 18 those -- 19 20 21 THE COURT: This is a defendant who is What aspects of the defendant's actions are commercial as opposed to political? MR. KLAUS: Well, the question that the Supreme Court 22 tells us in Harper & Row is that the distinction between 23 commercial/noncommercial is not whether somebody says I'm out 24 to make a huge profit. 25 whether I'm the NRDC. It's not whether I'm General Motors or The distinction is whether you are 20 1 exercising a right that customarily one would have to pay for in 2 that context. 3 noncommercial, the question really on the first fair-use factor, 4 Your Honor, on the transformativeness test -- 5 6 But regardless of whether he's commercial or THE COURT: I have a question. What would be a transformative use of your standards? 7 MR. KLAUS: Well, I could -- I could certainly imagine 8 somebody writing, for example, an article about critiquing the 9 standards. I could certainly imagine somebody writing an 10 academic piece that would say I've got a -- I've got a problem 11 with this or here's how the standards have developed in this 12 area. 13 I could certainly imagine numerous fair uses. And that's one of the important points, Your Honor, is on 14 fair use, the answer to the parade of horribles that we have 15 from the other side about people being thrown in jail for 16 speaking the law, about people being subject to massive statutory 17 damages awards for daring to write. 18 The idea that copyright is somehow this omnipresent force, 19 that once it's conferred there exists this pressure that will 20 inevitably lead to people stopping talking about whatever the 21 standards are that have been adopted by jurisdictions, that's 22 just not true, and there would be plenty of cases of fair use 23 that would be perfectly fine. 24 25 There are plenty of uses that people can make of the works in question. The issue is that the defendant's work here, what 21 1 the defendant is doing is entirely substitutional. 2 made the entire works available for copying for distribution 3 without limitation. 4 They have With all due respect to my friends on the other side, there 5 is no case in the history of fair use that has come close to 6 saying that a defendant who creates -- who engages in that sort 7 of verbatim copying and makes the entire work available in a 8 manner for copying for downloading, for distribution, that that 9 is in any sense for fair use. 10 And the two cases I would direct you to, Your Honor, the 11 most recent cases on this are -- calling them the Authors Guild 12 case does not help, because they're both Authors Guild cases 13 from the Third Circuit. 14 the Google Books case. 15 But one is the HathiTrust, and one is In the HathiTrust case, one of the claims of transformation 16 was that the HathiTrust had made searching easier for works. 17 It had a transformative purpose or function because the copying 18 made the works more easily searchable. 19 arguments, by the way, that the defendant has raised. 20 well, I, by converting these to HTML -- That's one of the He said, 21 THE COURT: They're visually more searchable. 22 MR. KLAUS: Right, which I should also add 23 parenthetically, the evidence in the record is that a number 24 of the standards here are also made available in HTML and XML. 25 That is part of a license that one has to look to. I would 22 1 refer Your Honor to Mr. Thomas's declaration at paragraph 44 in 2 that regard. 3 The important point in the HathiTrust case, though, is the 4 court went out of its way to say no copy of the work is made 5 available as a result of the searching. 6 that was done to enable searching allowed the computer, behind 7 the scenes, to find something and to refer the user to the 8 particular work, but it didn't make an exact copy available. 9 The Google Books case, also an Authors Guild case, also So the transformation 10 from the Second Circuit, there's a wrinkle in the Google Books 11 case, which is that Google not only made searching easier by its 12 copying, but it also provided snippet view, which is -- 13 THE COURT: And that was what was found to have 14 transformative -- was found to add value to the transformative 15 search function. 16 MR. KLAUS: It was found to add value to the 17 transformative search function, but Judge Leval went out of his 18 way to say that the snippet view did not operate as a substitute 19 for the work. 20 had put in place that it would -- for example, when a word 21 search was done, it would return only the same portion of the 22 work. 23 snippets and get the work. 24 excluded from the snippet view so that somebody couldn't game 25 the system that way. There were a number of precautions that Google One couldn't game the system by putting together multiple Works that were very short were Authors who wanted their works out could 23 1 2 opt out of the system. And Judge Leval's quite clear that it was putting this 3 mechanism in that made the difference, and he in fact 4 specifically said that at 804 F.3d 217, that if the function -- 5 not the purpose. 6 well, we're making all of your works available, but we're doing 7 it for a different purpose because we just want the law out 8 there, and therefore we win on the first factor. 9 Because the purpose, Public.Resource says, And what the Second Circuit said is, no, when you're 10 engaged in verbatim copying, the question as to whether or not 11 you win on that first factor is not what your purpose is, not 12 what your intent is; it's whether the function of what you're 13 doing is exactly the same as what the copyright owner does. 14 We'd say you have exactly the same thing here. 15 That conclusion, we think, drives the third factor, 100 16 percent copying, 100 percent of the work made available; and 17 also the fourth factor on market substitution, on the fact that 18 if this is fair use, if what the defendant here is doing is fair 19 use, there is no limitation to anyone doing the same thing. 20 One brief other point on fair use, Your Honor. There was a 21 claim that was made post hoc that this system was set up to make 22 these works available for the visually impaired. 23 hoc justifications, when you actually look at the facts and the 24 reality, that wasn't the purpose. 25 again points the way here on, there's no question that making Like most post What the HathiTrust case 24 1 works available to the print disabled is an important function. 2 The defendant's work doesn't just make the works available 3 to the print disabled; it makes it available to the entire 4 world. 5 the one print-disabled person who told one of the plaintiffs -- 6 my client, in fact -- that they had difficulty reading online, 7 they were given an entire copy. And, again, what the undisputed evidence shows is that 8 The other plaintiffs have said, if somebody said that they 9 had a problem, we would give them a copy, or they could even go 10 to what claims to be the Chafee Amendment compliant site that's 11 operated by Mr. Fruchterman, who was the defendants' expert, and 12 obtain a copy. 13 defense is completely without merit. 14 15 16 So we think, for that reason, the fair-use I believe I've gone over. I'm happy to answer any questions. THE COURT: we go along. No. I've been peppering you with them as Thank you. 17 MR. KLAUS: Thank you very much. 18 THE COURT: Mr. Hudis. 19 MR. HUDIS: Good morning, Your Honor. Jonathan Hudis 20 for plaintiffs in the 14-857 case, American Educational Research 21 Association, AERA; American Psychological Association, APA; and 22 National Council on Measurement in Education, NCME. 23 Your Honor, in our briefs we refer to AREA, APA, and NCME 24 as the sponsoring organizations of the 1999 Standards for 25 Educational and Psychological Testing, the work that was 25 1 2 infringed in this case. This is an even simpler case than the ASTM case, Your Honor. 3 Public.Resource, operated essentially by one person, Carl 4 Malamud, admits he digitally copied plaintiffs' standards and 5 published to the Internet for others to download, print, and 6 copy for free. 7 Public.Resource asks this Court to excuse its acts of 8 copyright infringement and contributory infringement as fair 9 use, stretching the limits of this defense well beyond its 10 breaking point, all while trampling on the copyrights of three 11 nonprofit organizations guaranteed to them by the Constitution 12 and the Copyright Act, and those are the rights to reproduce the 13 work, to prepare derivative works from it, to distribute copies, 14 and to display the work publicly. 15 It should be noted that, in addition to the copies of the 16 standards which can be purchased from the plaintiffs, their 17 standards are available at the U.S. Department of Education, the 18 Office of the Federal Register, and thousands of libraries 19 throughout the country. 20 THE COURT: Mr. Hudis, how much does it matter if you 21 can get the standards for free already, either through the OFR 22 or through libraries or read-only rooms, as you all have? 23 MR. HUDIS: Well, Your Honor, I was anticipating your 24 accessibility questions as to the ATSM plaintiffs, so we just 25 want to put that to rest. 26 1 THE COURT: Okay. 2 MR. HUDIS: So, as a legal matter, the answer is 3 nothing if defendant's theory of the case is correct, 4 Your Honor, that privately created standards lose their 5 copyright upon being incorporated by reference into the 6 regulations of an agency. 7 As plaintiffs' counsel said in the ASTM case, this Court 8 would be sanctioning a widespread taking of copyrighted property 9 without just compensation, in violation of the Fifth Amendment. 10 The standards development organizations do not have continuing 11 financial incentives to promulgate and update their valuable 12 works. 13 available to the public. 14 Important stores of knowledge will no longer be How to resolve the competing interest raised in this 15 litigation should be a decision for Congress to make, not the 16 court legislating from the bench. 17 should uphold the sponsoring organization's copyright and enjoin 18 Public.Resource from further acts of infringement. 19 20 THE COURT: In the meantime, this Court Mr. Hudis, I see that the 1999 standards weren't sold for a period of time. 21 MR. HUDIS: Yes, Your Honor. 22 THE COURT: Is there any obligation to sell them since 23 24 25 they're incorporate by reference into law? MR. HUDIS: Your Honor, that does not have a bearing on the case, to answer your question. The fact is they are on 27 1 sale for a period of time so that the 2014 standards could get 2 into circulation. 3 are now sold again on AERA's website. 4 The 1999 standards were taken off sale. THE COURT: They Even during the period in which they were 5 not for sale, were they available through OFR or through some 6 other means? 7 MR. HUDIS: They were available in three places: the 8 U.S. Department of Education, through the Office of Federal 9 Register, and thousands of libraries throughout the country. 10 THE COURT: Okay. 11 MR. HUDIS: So the answer's yes. 12 Now, Your Honor, plaintiff's work, the '99 standards 13 infringed in this case, were a set of best practices of 14 guidelines in the creation, administration, scoring and use of 15 standardized tests, covering issues such as test validity, 16 reliability, comparability, fairness, and other items. 17 sponsoring organizations don't keep the profits from these 18 sales, and they use the profits to fund further -- 19 THE COURT: Does that matter? 20 MR. HUDIS: No, it does not, Your Honor. The 21 But we are entitled to the fruits of our copyrighted work. 22 THE COURT: Right. 23 MR. HUDIS: Now as to authorship. The '99 standards 24 were born from an extensive revision of the 1985 standards by a 25 sixteen-member expert volunteer committee. Their work resulted 28 1 2 in over 50 percent of new content in the '99 version. Although -- now, and this is important because it was 3 raised in Public.Resource's briefing. 4 the '99 standards were published for comment, and many comments 5 to these drafts were received by joint committee, the ultimate 6 content of the 1999 standards came from the authorship of the 7 joint committee members. 8 9 Although the drafts of Public.Resource has not submitted any admissible evidence to the contrary, and in fact concedes in its summary judgment 10 brief at page 27 that the joint committee controls the final 11 product through the text. 12 13 14 THE COURT: So it's not creation by crowd sourcing or anything like that. MR. HUDIS: No, it is not. We have unrebutted 15 evidence in our record that says that the joint committee was 16 the ones who promulgated the final text. 17 comments, but there is no evidence in the record that those 18 comments were incorporated word for word into our standards. 19 The final selection of that language was chosen by the joint 20 committee members. 21 They did receive many Now, Your Honor, I'll skip over ownership because we 22 have that in another segment. Public.Resource confirmed its 23 infringing activities in its interrogatories and Mr. Malamud's 24 deposition testimony without permission. 25 of the 1999 standards, which I have here. He bought a used copy 29 1 He cut apart its bindings, scanned the entire book to an 2 Acrobat Reader PDF file with a self-made certificate, which we 3 handed up to Your Honor, and appended the certificate to the 4 front, published the PDF file to its own website, and also 5 published that file to the Internet Archive site. 6 Your Honor, and which came up in the other argument, neither 7 side precluded users from freely downloading or printing the PDF 8 file. 9 Importantly, These facts are uncontested. As to contributory copyright infringement, the self-made 10 certificates that you have before Your Honor are appended to 11 the front of the unauthorized PDF copy of the standards, 12 unmistakably states that the work was incorporated by reference 13 into regulations. 14 15 In Public.Resource and Mr. Malamud's view -- THE COURT: You said this is a self-created certificate? 16 MR. HUDIS: Yes. Mr. Malamud created it. 17 THE COURT: So this approved seal -- 18 MR. HUDIS: That's all Mr. Malamud's creation. 19 THE COURT: Okay. 20 MR. HUDIS: In Mr. Malamud's and Public.Resource's 21 view, once incorporated by reference, the standards lose their 22 copyrighted protection and thereafter can be freely copied by 23 anybody. 24 the public a false sense of approval or permission to download, 25 print, or copy the standards without authorization. Therefore, the purpose of the certificate was to give 30 1 Additionally, and if you would look -- 2 THE COURT: Well, isn't that one reading of it? One 3 interpretation of the self-created certificate is to create an 4 imprimtur of officialdom. 5 official incorporator. 6 Register. 7 confer an imprimtur that it's an approved, official document? 8 9 I mean, it has a seal. It has an It has a lot of citations to the Federal Isn't one interpretation of a certificate is just to MR. HUDIS: Until we took the deposition of Mr. Malamud, one would agree with you, Your Honor. But the 10 purpose of putting up that up certificate was, in his view, 11 to tell the public that, upon incorporation by reference, the 12 standards were now losing their copyright and freely available 13 for everybody. 14 And he went even further, Your Honor. When he published 15 the standards to the Internet Archive site -- I've put several 16 of these in front of you, Your Honor. 17 bottom right, before the red at the very bottom, it says 18 "Creative Commons License." 19 deposition, and he said, "This language included the creative 20 commons license, indicating that no rights were being asserted 21 over the item." 22 You can see at the very So we asked him about that at his So, according to Public.Resource's interrogatory answers 23 and discovery taken of the Internet Archive, during the nearly 24 two-year period that the PDF file was published to the two 25 websites, the standards were accessed several thousand times. 31 1 We do not know who accessed the unauthorized, online copies 2 because Public.Resource refused to provide its web server logs, 3 and our discovery motion seeking their production was denied. 4 During the same two-year period that the unauthorized PDF 5 file was published online, the sponsoring organizations 6 experienced a precipitous drop in the sales of their standards, 7 which is inconsistent with a work of this longevity where we 8 typically would have seen a gradual year-over-year sales decline, 9 according to our expert, Dr. Geisinger. While ongoing work on a 10 new edition of the standards, ultimately published in 2014, was 11 announced during this period, this does not explain away the 12 considerable sales drop. 13 While members of the sponsoring organizations might have 14 wanted to wait for new editions of the standards, psychometrics 15 and educational testing students could not wait because the 1999 16 standards were still being assigned as cross-reading material. 17 We had become aware that students were obtaining free copies 18 online with Public.Resource as their source. 19 Now as to harm. Public.Resource still has the 20 unauthorized PDF file of the '99 standards in its possession. 21 If Public.Resource is successful in this suit, defendant can 22 easily republish the file to the Internet. 23 Further, Public.Resource's every intention, if allowed by 24 this Court to do so, is publishing the sponsoring organizations' 25 2014 standards to the Internet once incorporated by reference 32 1 2 3 4 into government regulations. THE COURT: That's where your irreparable injury and continuing harm argument comes in. MR. HUDIS: Yes, Your Honor. And future harm to the 5 sponsoring organizations includes loss of future income to fund 6 further revised editions of the standards and public confusion 7 that the '99 standards are the current version of the standards 8 published by the sponsoring organizations, when they're not. 9 High-stakes tests, Your Honor, the gateways to educational 10 matriculation and attaining employment, must be properly 11 designed, administered, scored, and relied upon. 12 a high-societal value for the continuing update of the standards, 13 an important body work, produced for the general public. 14 There is thus Now, what could have Public.Resource done differently? 15 Public.Resource makes a red herring argument, as it did in the 16 ASTM case, that the purpose of its infringing activity was to 17 make the sponsoring organization's standards available to the 18 blind or people with less severe print disabilities. 19 If that was truly the case, Your Honor, Public.Resource 20 could have narrowly tailored access to plaintiffs' standards 21 to individuals with certified blindness or print disabilities 22 as provided under the Chafee Amendment such as Braille, 23 audiotape/CD availability, large font, video, screen, or closed- 24 circuit TV magnification, color contrast choices, human readers, 25 or limited search term availability as we discussed in the 33 1 2 HathiTrust and the Google cases. Public.Resource could have imposed limitations on 3 the availability by methods as access -- methods of access by 4 credentials such as a user name, password, digital rights 5 management, fingerprint tracing of unauthorized downloads, and 6 access terms and conditions, all which was testified to by 7 defendant's expert, Mr. Fruchterman, that he and his company 8 practice on the Bookshare-Benetech website. 9 Your Honor, so we have met our elements of the cause of 10 action. 11 copyrights of the entire work. 12 formalities of registration. 13 factual matter, and copying of the copyrighted material was so 14 expensive that it rendered the offending and copyrighted works 15 identical. 16 17 18 19 We have a valid copyright, which is conceded, THE COURT: We complied with the statutory We also here have copying as a Mr. Hudis, what evidence do you have of direct third-party copyright infringement? MR. HUDIS: Your Honor, a good question. Now direct copyright by third parties. Thousands of 20 Internet users access the standards on Public.Resource's 21 Internet Archive's website. 22 testimony and the interrogatory answers of Public.Resource, and 23 we have the deposition testimony of Internet Archive. 24 25 THE COURT: website; right? We have that from the deposition But that's based on like hits to the What's your direct evidence that people 34 1 actually downloaded this material? 2 MR. HUDIS: Okay. So, Your Honor, the one piece of 3 evidence that we were looking for for that were the web server 4 logs. We never got them. 5 6 THE COURT: Right. You submitted, I think, an affidavit -- or not an affidavit but an e-mail. 7 MR. HUDIS: Yes. 8 THE COURT: From, I think, a professor saying that the 9 Two sets of e-mails. students got it off the -- 10 MR. HUDIS: Yes. 11 THE COURT: But notwithstanding admissibility 12 questions, because -- 13 MR. HUDIS: That's hearsay, Your Honor. 14 THE COURT: Well, you're right. 15 MR. HUDIS: No. No. Is that it? So the users who pulled up 16 the standards on their web browsers displayed the copyrighted 17 material, at which time the copies were made in the random 18 access memory of their computers to permit viewing of the 19 materials. 20 even temporary ones, those users directly infringed the 21 copyright. 22 we experienced the precipitous drop in our sales. 23 By displaying the work and making those copies, Your Honor, during that same period of time is when So, Your Honor, we took as much circumstantial evidence 24 as we could give to you to muster. We have the period of time 25 from mid-2012 to mid-2014 when the standards were up on the two 35 1 websites. 2 that the sales went down. 3 because we never got the web server logs. 4 counsel for the defendant will tell us that we're all wet on 5 that, but that is our circumstantial evidence. 6 We have the proof of access, and we have the proof That's our circumstantial case And I am sure learned Your Honor, Public.Resource contends that a copy for 7 purposes of copyright is limited to physical objects and thus 8 did not make a copy of the standards in the legal sense. 9 is absolutely false. That The infringing version stored on 10 Public.Resource and Internet Archive's web servers are copies 11 for the purposes of the Copyright Act. 12 work stays on computer. 13 copies under § 101 of the Copyright Act. 14 Electronic copies of the Computers, with their RAM memories, are I've gone through the evidence of reproducing, of creating 15 derivative works, of distribution. Your Honor, I would like to 16 now turn to Public.Resource's defenses, unless you have any 17 questions. 18 THE COURT: That's fine. 19 MR. HUDIS: All right. Your Honor, Public.Resource 20 does not need to access the standards, free or paid for, in 21 order to comply with any of the government regulations or laws. 22 Public.Resource claims it has the right to post copies -- 23 THE COURT: You have to slow down again, Mr. Hudis. 24 MR. HUDIS: Slow down? 25 THE COURT: A little bit. 36 1 MR. HUDIS: All right -- of our standards online so 2 that others can copy, print, distribute, or otherwise use them 3 for free. 4 distinguishable. 5 Banks v. Manchester, Ohio Supreme Court decision; Howell v. 6 Miller, Michigan state statutes; and let's talk about the Veeck 7 case which you brought up with my learned co-counsel. 8 9 All of the cases relied upon by Public.Resource are Wheaton v. Peters, Supreme Court decisions. Veeck involved a word-for-word reproduction of model building code into legislation which does not apply to the 10 incorporation by reference of extrinsic standards, making Veeck 11 inapplicable in reasoning and result. 12 that the law, whether articulated in judicial opinions or 13 legislative acts or ordinances, is in the public domain. 14 The holding of Veeck is Importantly, Your Honor, at pages 803 and 804, Veeck says 15 clearly, "The limits of this holding must be explained. 16 national standards-writing organizations fear that copyrights 17 may be vitiated simply by the common practice of governmental 18 entities' incorporating their standards in laws and regulations. 19 This case does not involve references to extrinsic standards. 20 Instead, it concerns the wholesale adoption of a model code 21 promulgated by its author precisely for use as legislation. 22 Case law that derives from official incorporation of extrinsic 23 standards is distinguishable in reasoning and result." 24 25 Several A statute that refers to the law requires citizens to consult or use a copyrighted work in the process of fulfilling 37 1 their obligations. 2 do not become law merely because the statute refers to them. 3 Discussing referenced works or standards created by private 4 groups other than incorporation by laws we have here, the Veeck 5 court explains that to the extent incentives are relevant to 6 existence of copyright protection, the authors in these cases 7 deserve incentives. 8 9 Your Honor, importantly, copyrighted works Now, my learned colleague brought up § 105 of the Copyright Act. I'd like to give you the reverse or other side of the coin 10 to that, which is Copyright Act § 201(e): "No action by any 11 governmental body purporting to seize, expropriate, transfer, or 12 exercise rights of ownership with respect to the copyright, or 13 any of the exclusive rights under a copyright, shall be given 14 effect." 15 So the mere incorporation by reference, as learned counsel 16 said in Circular A-119, you have to be careful of the copyright. 17 Also, we've already discussed the CCC and Practice Management 18 cases, much closer on the facts to this case. 19 over them again. 20 I will not go Your Honor, fair use. THE COURT: Again, I'm going to ask you the same 21 question I asked Mr. Klaus, which would be, what would be a 22 transformative use of your standards? 23 MR. HUDIS: Mr. Klaus gave very good examples, and 24 I will use them here; that is discussing, commenting on, 25 critiquing our standards for one reason or another, and as a 38 1 matter of fact, that is done with our standards all the time. 2 But it is not the wholesale copying, and it is not the wholesale 3 copying and making available to the public for free of our 4 standards which Public.Resource did here. 5 THE COURT: And again, the same question. If you 6 stopped selling the standards, are they still reasonably 7 available under the OFR's regulation? 8 MR. HUDIS: Three places, Your Honor. 9 THE COURT: Libraries. 10 MR. HUDIS: Thousands of libraries, the Department of 11 Education, and the Federal Register office. 12 the country. So all of the amici -- you say, we need copies, we 13 need copies? They've got them. 14 whether they are characterized as being core-expressive content, 15 which they are, or assemblage of facts, which they're not, is 16 usually not an important factor. 17 So, yes, throughout So the nature of our standards, The third factor, Public.Resource misappropriated our 18 entire work, and Public.Resource's actions, as I've already 19 explained to the Court, will drastically affect the market and 20 value for plaintiffs' standards. 21 case. 22 which our clients promulgated these standards, making them 23 valueless, at least in a copyright sense. 24 25 It's just like in the ASTM This is a wholesale substitution for the purpose for Your Honor, some defenses also, in addition to fair use that Public.Resource raised for the first time, at least in our 39 1 case, in their briefs should not be countenanced by the Court, 2 and that is the Copyright Act 102(b) systems process and 3 procedure bar, the idea-expression merger doctrine, and the 4 sense of fair doctrine, all of which, in any case, are 5 inapplicable, as we briefed. 6 Your Honor, there are two types of incorporation by 7 reference defenses that we have here, one which was in their 8 answer, the other one which was not, one which says, immediately 9 upon being incorporation by reference, it becomes a fact. 10 was raised in their answer. 11 That We don't agree with that, and that's what the Court's going to decide. 12 They're also saying that, by its very nature, these are all 13 saying the same thing, these three defenses raised for the first 14 time in their briefing, that it either is a system or process or 15 procedure, it's an idea or expression, or it is scènes à faire. 16 Your Honor, in each defense, there is no proof by expert 17 testimony what is the idea, what is the expression, what is the 18 system, and as a matter of fact, Your Honor, in our very 19 standards, it says at the beginning, "evaluating the 20 acceptability of a test or test application does not rest on the 21 literal satisfaction of every standard in this document." 22 23 24 25 THE COURT: You have to slow down again. We all speed up when we read. MR. HUDIS: You're right. Okay. "The acceptability cannot be determined by using a 40 1 checklist." 2 standards, which is in evidence. 3 This is at page 4 of our introduction of the "When testing an issue in legal proceedings and other 4 venues, witness testimony, it is essential that professional 5 judgment be based on the accepted corpus of knowledge in 6 determining the relevance of particular standards in a given 7 situation. 8 such judgments." 9 The intent of the standards is to offer guidance for THE COURT: But even without that preamble, Congress 10 was aware of the potential issue that materials incorporated by 11 reference posed when it crafted § 105. 12 it had given federal agencies the authority to incorporate 13 private works, and it expressly stated that they would not lose 14 copyright protection. 15 any further than that. Ten years before then, So I'm not even sure that we need to go 16 MR. HUDIS: We would agree with you, Your Honor. 17 THE COURT: I guess that question is more appropriately 18 posed to defendants. 19 MR. HUDIS: Yes. So, Your Honor, there's also other 20 defenses that were raised. And by the way, none of these were 21 briefed whatsoever. 22 -- just looking for it. 23 waiver and estoppel. 24 judgment on that. 25 All right. They should just be dismissed out of hand Unclean hands, copyright misuse, and We all -- the plaintiffs move for summary Nothing was briefed by Public.Resource. So, Your Honor, I think I am just about out of 41 1 time. Unless Your Honor has any further questions, I will save 2 my remarks for the rest of the segments. 3 THE COURT: Thank you, Mr. Hudis. 4 MR. HUDIS: Thank you, Your Honor. 5 THE COURT: All right. 6 you have 45 minutes, obviously. 7 one person is going to do the duration? 8 MS. MCSHERRY: 9 THE COURT: 10 11 Are you going to break it up or We're going to break it up, Your Honor. All right. MS. MCSHERRY: I think we have 50 minutes, I hope. Perhaps we won't need it. 12 13 Whose going to -- defendants, THE COURT: If says 45, but if you need to go to 50, I think we're okay. 14 MS. MCSHERRY: 15 THE COURT: 16 MS. MCSHERRY: Okay. Yes. I'll try to keep my remarks as brief as 17 possible. 18 paper you've had to read. 19 surprising, which is that, for once, I agree with my colleague, 20 opposing counsel, Kelly Klaus. 21 I, like everyone else, is very conscious of how much So I'm going to start with something This is a straightforward case. We think it's straightforward in a slightly different way, 22 however. There are a lot of claims and defenses in this case, 23 but I think it does boil down to one core issue, which is that 24 the documents at issue here have been incorporated into law. 25 That's why we're here, in essence. 42 1 THE COURT: Well, let's start with the last question 2 I asked Mr. Hudis about. 3 issue? 4 standards such as the one at issue here, isn't that something 5 for Congress to decide to do and not this court? 6 to be a matter of what the legislature wants. 7 for me to -- you know, I can't legislate copyright. 8 9 Hasn't Congress already ruled on this And if copyright protection is going to be stripped from MS. MCSHERRY: Sure. It does seem Copyright is not And I wouldn't ask you to. Let me take you back, if you would indulge me. I think we need 10 to take this back to first principles a little bit before we 11 decide what Congress is even allowed to do. 12 Congress legislated against was a background of 200 years of 13 unbroken law that says that the law is not copyrighted. 14 much I think is not controversial. 15 We know what That We have cases talking about opinions, cases talking about 16 statutes, cases talking about regulations. 17 every court that's looked at his has said that the law is 18 outside of copyright, and there's a reason for that: because the 19 public has a fundamental due process and First Amendment right 20 to access the law and to talk about the law, and those rights 21 are sort of fundamental to self-government. 22 THE COURT: In case after case, But by what standard are you asking that 23 I judge that the standards have enough creative expression to 24 warrant copyright protection? 25 deciding that? What standard should I apply if 43 1 MS. MCSHERRY: Well, I would suggest that you look to 2 the BOCA case and you look to the Veeck case and look to the 3 reasoning in both of those cases, and they looked at this issue 4 in two different ways. 5 First they looked at the tradition of case law that they 6 had before them and came to the conclusion that, due to due 7 process considerations in particular, the law was in the public 8 domain. 9 cases. 10 So that was the first part of the decisions in those And to be clear, the BOCA case, what the BOCA case was 11 doing was rejecting a preliminary injunction. 12 of that -- and then it remanded. 13 rejection, it explained its reasons why it thought that the 14 district court had got it wrong in holding that there was a 15 possibility of success on the merits with respect to the 16 copyrightability of codes. 17 But in the course But in the course of its So it's a really -- and I urge you to look to that case, 18 because it's a very detailed explication of the tradition of 19 case law that you also get in the Veeck case. 20 earlier, and it's really one of the first cases to look at the 21 problem of building codes and how we're going to look at them. 22 I think it's also important to understand that all of the But BOCA is 23 cases that have looked at this have looked at this one core 24 problem, which is that we have a conflict between the exclusive 25 rights that are granted to a copyright holder and our 44 1 2 constitutional rights to share the law and access the law. So the only place it got strange is, you know, we have this 3 particular conundrum where we have this one area of law that 4 operates a little bit differently because -- and it's really an 5 artifact of history. 6 getting cumbersome. 7 THE COURT: The Code of Federal Regulations was Yes. I just want to clarify something on the 8 BOCA case that your mentioned, because you said that the district 9 court granted the request for preliminary injunction. But when 10 the First Circuit reversed that decision, it didn't do so based 11 on the merits. 12 13 MS. MCSHERRY: discussion. 14 THE COURT: 15 MS. MCSHERRY: 16 17 What it did is it remanded for further Right. But it also spent quite a bit of time explaining why it thought the district court had got it wrong. So it seems to me that when we talk about a circuit split, 18 we actually have a more substantial circuit split. 19 just Veeck versus Practice Management. 20 It's not We have Veeck and BOCA, and then, of course, we have the 21 long tradition of cases that precede that. But these are the 22 cases that most directly address our issue here, which is what 23 happens when you've got standards that are incorporated into 24 binding regulations and whether they're an exception to what is 25 otherwise very clearly the rule. 45 1 THE COURT: But isn't your case made more difficult 2 by the fact that you're not really asking -- this is more of a 3 case of a matter of ease of access. 4 at issue here are accessible without -- you can look at them. 5 You can read them. 6 public library if you need to if you don't have $22 to buy them. 7 The codes and the standards You can go make a copy of them at your What you're asking for is to make them simply more easily 8 accessible; right? 9 that they're not available as easily as you'd like them to be 10 It's not that they're not available; it's available; right? 11 MS. MCSHERRY: Well, my client would certainly like to 12 make them more accessible, but that's actually sort of a second 13 point. 14 we should make them more accessible as technology makes that 15 possible. 16 the public domain. 17 The prior point is that if they are law, then of course That's a wonderful thing. THE COURT: But either way, they're in Well, Congress considered this when it 18 declared that simply by being incorporated, works didn't lose 19 copyright protection, and one of the reasons is because of the 20 public policy behind the creation of such standards, which is 21 they want organizations to continue to promulgate such standards 22 because they're for the public good. 23 If they rob them of copyright protection, then there is no 24 incentive to continue to promulgate these standards, and that 25 was a factor that Congress took into consideration when it 46 1 declared that simply being incorporated by a reference didn't 2 strip a work of its copyright protection. 3 jump is as easy as you make it. 4 So I don't think the You know, simply because it's been incorporated by a 5 reference doesn't make it the law. 6 certain laws, maybe, but the leap isn't quite that easy. 7 guess that's where my concern is. 8 standards that you think make them the law? 9 MS. MCSHERRY: It's been incorporated into And I What is it about these Well, there's a couple things that I 10 think make them the law. 11 example, and you look to the National Archives website, which 12 we've submitted to you, and in many, many other places there's 13 an agreement that these standards, once incorporated by 14 reference, have the force and effect of law. 15 THE COURT: If you look at the IBR Handbook, for And? In other words, one key focus of the 16 Ninth Circuit was whether there was evidence that individuals 17 had been denied accesses to incorporated works. 18 forth any evidence that anybody has been denied access, or are 19 you saying that's irrelevant? 20 MS. MCSHERRY: Have you put I actually don't think it's 21 irrelevant. I think it's an important thing that distinguishes 22 this case from Practice Management, because you're quite right. 23 Practice Management says there's no realistic threat here of 24 access to law, and if there were, that would raise due process 25 and fair use issues. 47 1 THE COURT: And in BOCA, similarly, the government, 2 the local government, anybody who wanted to see the building 3 codes had to go buy a $22, or whatever it was, copy of the 4 codes. 5 -- you don't just have to have money to get access to these 6 standards, and that's another key distinction between this case 7 and BOCA. 8 9 That's not the case here. MS. MCSHERRY: There is not just one place So I think that the core question is what does copyright grant in terms of how you can condition 10 access. 11 plaintiffs, the AERA plaintiffs, took the 1999 standards off the 12 market altogether, until it came up in a deposition and they 13 made them available again. 14 So what we know is that, for example, one of the The reading rooms that exist, you can only access them 15 subject to after you sign a contract and give over your 16 information, so it's subject to a lot of restrictions. 17 that's what happens when you allow folks to have a copyright 18 in the law. 19 right to control and limit and restrict access, and that's the 20 fundamental contradiction that -- 21 And What a copyright gives you, in any document, is a THE COURT: But in the case of these standards, it's 22 not just that -- there's only a certain amount of control that 23 plaintiffs have. 24 standards have to be available for viewing through the Office of 25 the Federal Register; right? Once they're in the Office of Federal -- the Plaintiffs can't just say, you 48 1 have to give us money to see these or you don't get them. 2 are other ways to get them. 3 MS. MCSHERRY: There So what the plaintiffs -- what they're 4 obligated to do currently is to simply deposit a couple of 5 copies. 6 D.C., and make a copy of the standards -- So if you don't have the means to travel to Washington, 7 THE COURT: 8 MS. MCSHERRY: 9 Or go to a library? Or if it happens to be in your local library, maybe it doesn't. And also, if you are print disabled, 10 you're going to have a harder time getting access to these 11 standards. 12 It's that statutory monopoly that lets you do that, and all of 13 those restrictions are improper because they conflict with our 14 constitutional due process and First Amendment rights. 15 And again, that's exactly what copyright confers. THE COURT: When Congress passed a National Technology 16 Transfer and Advancement Act, it surely knew that the standards 17 directed agencies to incorporate reference were copyrighted. 18 Since the copyright protections are also statutory, wouldn't 19 Congress have explicitly indicated that it was expanding the 20 type of government works that cannot be copyrighted if it wanted 21 to do that? 22 MS. MCSHERRY: Well, I think that Congress didn't 23 need to do that, for two different reasons. 24 already had -- well, two things. 25 never trump a constitutional right. One is because we One is statutory right can So we'll take that as a 49 1 given. But secondly, the Copyright Act actually contains 2 carve-outs -- 3 THE COURT: Right. 4 MS. MCSHERRY: -- for the law, the merger doctrine 5 and 102(b), which both reflect this idea of the idea-expression 6 dichotomy. 7 but if you look to the case of Golan v. Holder, that's a Supreme 8 Court case, and one of the things that that case says is when 9 you have a tension between copyright and the First Amendment, And I would point you to a case that came later, 10 we have certain doctrines that help resolve that tension. 11 of those is the idea-expression dichotomy. 12 use. 13 One Veeck court was up to. The other is fair And I would suggest to you that that's exactly what the 14 It recognized it had a constitutional tension, and it 15 looked to merger, it looked to 102(b), to resolve that tension. 16 The plaintiffs in this case talk a lot about constitutional 17 avoidance, but I would submit to you that the Veeck approach 18 and the BOCA approach are actually what gets you out of the 19 Constitutional conundrum that you might otherwise have. 20 THE COURT: You're asking this Court to balance the 21 policy goal of unrestricted access to privately authored 22 materials with a policy goal of providing continued incentives 23 to private organizations to continue developing standards. 24 25 Isn't that kind of balancing -- didn't Congress already do that when it passed the Copyright Act and didn't list 50 1 incorporated by reference works among those that cannot have 2 copyright protection under § 105? 3 MS. MCSHERRY: Well, again, I would suggest to Your 4 Honor that Congress didn't think it had to because it already 5 had these carve-outs for the law, and it was legislating against 6 200 years of case law, saying that the law was out of copyright. 7 So they didn't need to reach this. 8 9 The other thing that I would suggest is I do think this issue of incentives is quite important, and the plaintiffs talk 10 a lot about this wonderful public-private partnership. 11 don't disagree that there is a powerful partnership that happens 12 here, but I think that it's false to suggest that no incentives 13 will exist if the plaintiffs can't claim a copyright in works 14 that have been incorporated into law. 15 they have tremendous incentives already. 16 And I I think, to the contrary, The fact that their documents are incorporated into law is 17 very beneficial to them. They use it as a marketing tool 18 because there's a -- do I have... excuse me just a moment. 19 I'll share with you just one example, if I may. This is 20 an e-mail that NFPA sent out. 21 strike, and it says, "Be confident that your electrical work 22 complies with California law." 23 National Electrical Code, has been incorporated into law, and 24 they use this as a marketing tool. 25 It's an exhibit to our motion to So they know that the NEC, the This is reflected also in the fact that when they write, 51 1 the NEC Style Manual specifically advises the folks who are 2 working with it on how to write code-compliant regulations. 3 They know their works are going to be incorporated into law. 4 They benefit from their works being incorporated into law 5 because it's a basis of other marketing. 6 They also benefit because, as they said, and there's a lot 7 of testimony about this, they want their works incorporated into 8 law because that makes them mandatory, and they think that makes 9 the world more safe. 10 THE COURT: They may very well be right. The Fifth Circuit in Veeck said that, 11 unlike model codes that are wholly adopted into law and impose 12 legal obligations, these incorporated standards -- and I guess 13 that's where the plaintiffs assert that they differ from Veeck 14 -- these incorporated standards are only required to be 15 consulted or used in the course of fulfilling existing legal 16 obligations. 17 They're not binding law. So isn't that what the cases here -- I mean, Veeck drew 18 that distinction, and don't plaintiffs fall on the other side of 19 that distinction? 20 have been incorporated, but they themselves don't -- in other 21 words, plaintiffs can't send out e-mails saying if you don't 22 follow our codes or our standards, you're falling afoul of the 23 law. 24 not like building codes or model penal codes or commercial 25 codes; right? In other words, the standards at issue here They can only say to the extent they're being -- they're 52 1 MS. MCSHERRY: I would disagree with you, Your Honor. 2 If I build a building and it doesn't comply with the National 3 Electrical Code, I'm going to face penalties. 4 with a national fire safety code -- the various ones, there are 5 many -- I'm going to face penalties. 6 and I want to know if the school that my child goes to is 7 complying with fire safety regulations, I want to know what 8 those fire safety regulations are because it's supposed to be 9 built to that code. 10 means. If I don't comply But also, if I'm a parent That's what incorporation by reference It means it has the force and effect of the law. 11 THE COURT: Once it's incorporated. 12 MS. MCSHERRY: Once it's incorporated. That's 13 correct. 14 Veeck and intent. 15 that the Veeck holding was based on two separate grounds. 16 One other thing I'd like to speak to is this issue of So, first of all, I'd like to just clarify The first part of the Veeck holding, the Veeck court looks 17 at the Banks cases and concludes that the due process 18 considerations there apply with respect to model codes as well. 19 But the issue of intent. So the Veeck court's merger 20 analysis does not depend on intent. 21 analysis depends on its conclusion that, once incorporated by 22 reference into law, the expression and the idea merge. 23 is no other way to describe what you have to comply with. 24 like the Constitution, just like the tax code, the Code of 25 Federal Regulations works the same way. The Veeck court's merger There Just 53 1 THE COURT: The standards here that are incorporated 2 by reference provide guidelines and procedures in some of them 3 that individuals or entities have to use or reference in 4 fulfillment of their legal obligations under federal 5 regulations. 6 difference, there's no evidence that anyone here has been denied 7 access to the standards. 8 should have better access to the standards. 9 case in Veeck, was it? 10 But again, and I think this is a significant MS. MCSHERRY: What you're arguing is that people That wasn't the So what I'm arguing is that the law is 11 not copyrightable, and, therefore, as technology develops, we 12 can make access better and better and better. 13 second. Access comes Access is important, but it is not the only thing. 14 THE COURT: Some of the standards that have been 15 presented to me, for example, ASTM, the 86-07, which is at page 16 107 and 6, include what a law review article refers to as 17 secondary references where to fully comply with the standard you 18 also have to comply with a list of other standards. 19 your position on whether these secondarily referenced 20 standards -- have those also lost copyright protection? 21 MS. MCSHERRY: 22 THE COURT: So what's So I think what -- Even if they're incorporated into the 23 incorporated standard or they're included in the incorporated 24 standard? 25 MS. MCSHERRY: Where does it end? 54 1 THE COURT: Yeah. 2 MS. MCSHERRY: So I think where it ends is I would go 3 back to the CFR, to the Code of Federal Regulations, and ask 4 what has explicitly incorporated there, which is what we're 5 presented with here. 6 Now, if there's further references on top of that that 7 aren't explicitly incorporated, I think we might understand that 8 differently, and in any event, my client doesn't publish those. 9 He's trying to publish and create a sort of grand, unified CFR, 10 because what we have right now is a very disjointed Code of 11 Federal Regulations where we have sort of one code of 12 regulations that's online that you can see. 13 out to hundreds of other standards that you then have to 14 separately consult if you want to understand what the law is. 15 That's the core of our problem. 16 But then it refers I'd like to talk a few minutes about -- well, I think I 17 want to answer a question that I think you were asking earlier 18 about Veeck's focus, also on intent, and that building codes, 19 the model codes in that case, were intended to be created into 20 law. 21 this again. 22 standards organizations know very well and very much want their 23 standards to be incorporated into law. 24 25 I think I've already referred to this, but I would say There's ample evidence in the record that the THE COURT: And? I mean, of course. If you promulgate standards and you sell them, isn't it better for you 55 1 if your standards are promulgated into law because more people 2 will want to buy them? 3 protection, the fact that they hope that some governing bodies 4 or some local governments or federal governments will incorporate 5 their standards? 6 Does that rob them of copyright Doesn't that mean they've been successful? MS. MCSHERRY: Well, I think what it just speaks to is 7 this question that I think the plaintiffs have tried to suggest, 8 that Veeck turns on the intent of the creator, and I'm just 9 simply trying to answer that question -- 10 THE COURT: And their intent is? 11 MS. MCSHERRY: Their intent is to have them made into 12 law, and that's fine. 13 think having stuff being incorporated into law is a tremendous 14 marketing tool. 15 quarrel with that either. 16 Again, I have no quarrel with that, and I But it also helps make us all safer. We don't What we quarrel with is the proposition that once one has 17 accomplished that goal of incorporation into the law, somehow 18 you still get to control and restrict access forever. 19 plaintiff, again, who took one of the standards off the market 20 altogether. 21 They may or may not exist tomorrow. 22 We have a And the reading rooms that exist, they exist now. THE COURT: But isn't the solution to that issue the 23 responsibility of Congress? I mean, if Congress wanted to strip 24 materials incorporated by reference of all copyright protection, 25 they could do so very easily and very clearly. And your argument, 56 1 well, they didn't need to do that in this case is -- you know, 2 nobody wants to try to figure out what's in the mind of Congress 3 when they do something, but when they have the power to enact or 4 to declare what's covered by a copyright or not, they do so. 5 The fact that they explicitly left works incorporated by 6 reference with copyright protection means that you want me to 7 now say, well, Congress, I know you said that they have 8 copyright protection, but, actually, under these circumstances, 9 they don't. 10 11 And isn't that action one that's really meant for the legislature? MS. MCSHERRY: I don't think so, Your Honor. For one 12 thing, I don't think that Congress can make an unconstitutional 13 bargain, and so if there are, as we believe, the fundamental due 14 process and free speech considerations in play here, Congress 15 can't write a statute -- 16 17 THE COURT: Constitution as well. Copyright protection comes from the I mean -- 18 MS. MCSHERRY: 19 THE COURT: Copyright protection is -- sorry. It is of constitutional dimension, and 20 therefore -- if we're talking about what the framers wanted 21 in district court, we're in trouble. 22 copyright, having derived from the Constitution, that Congress 23 is well aware of what it can do and not within the Constitution 24 even in the face of the Due Process Clause. 25 MS. MCSHERRY: One could argue that I completely agree with you. 57 1 THE COURT: Is there a case you can cite to me where 2 a court has done what you're asking me to do where the standards 3 were available? 4 but where someone without funds could access the standards. 5 Not where the standards had to be purchased, MS. MCSHERRY: So, actually, I think in the Veeck 6 case, if you wanted to go get hold of them and you wanted to go 7 to this little town, the person who posted the standards online 8 was able to acquire them. 9 But again, I want to reemphasize that this case does not turn 10 11 simply on accessibility. THE COURT: So you can get hold of the standards. That's just a benefit of it. Right. Because you're saying that the 12 standards were already basically not capable of being copyrighted 13 once they were incorporated by reference. 14 MS. MCSHERRY: That's correct. And, Your Honor, I 15 would say to your earlier question, of course copyright derives 16 from the Constitution as well. 17 that copyright is a statutory right, and statutory rights don't 18 trump constitutional rights. 19 THE COURT: But nonetheless, it's very clear Can you cite me a case where a court has 20 said that regardless of their accessibility, once a standard has 21 been incorporated by reference into a law, it loses copyright 22 protection? 23 MS. MCSHERRY: I think that's exactly what the Veeck 24 case is saying. I think that's what that case is saying, and I 25 think it's what the BOCA case is saying. And they're saying it 58 1 2 against a background of hundreds of years of case law. I'm mindful of my time, and I want to make sure I leave 3 time for the remaining issues, so I just want to touch on a 4 couple of other issues. 5 One is with Practice Management. Again, Practice Management 6 said there was no realistic threat of access. 7 have that here. 8 does acknowledge that if there were such a threat, they would be 9 more concerned about due process. 10 11 I think we do I don't think the case turns on that, but it But that evidence is simply not before the Court. The other thing that Practice Management was worried about 12 and CCC was worried about is depriving the SDOs of incentives, 13 and as I think we've discussed, there are plenty of incentives 14 that would still exist. 15 The final thing I want to speak to is the issue of takings, 16 because there's been sort of a lot of hand-waving around about 17 maybe creating a takings problem. 18 THE COURT: Well, I want to ask you, what about -- in 19 its Notice of Proposed Rulemaking, OFR relied on your argument 20 -- well, it addressed your argument, and it ultimately rejected 21 a proposal to require free online access to standards in its 22 "reasonably available" determination. 23 It said, "If we required that all materials IBR'd into CFR 24 be available for free, that requirement would compromise the 25 ability of regulators to rely on voluntary consensus standards, 59 1 possibly requiring them to create their own standards which is 2 contrary to the NTTAA and the OMB Circular A-119." 3 Doesn't that indicate a congressional intent to continue 4 to give copyright protection for standards incorporated by 5 reference? 6 MS. MCSHERRY: I think the OFR came to that conclusion 7 because the SDOs came and said the exact same thing they're 8 saying here, which is we'll take our toys and go home if we're 9 not allowed to have copyright protection. 10 THE COURT: But isn't that factor perfectly reasonable 11 for Congress to consider? 12 look, if we strip these standards of copyright protection, 13 there's not going to be any more of this voluntary consensus 14 standard development, and we're going to have to -- it's going 15 to be a problem for the government. 16 we're going to allow them to continue to keep their copyright 17 protection. 18 do? 19 20 21 In other words, the Congress can say, So, in return for that, Isn't that something that Congress is allowed to MS. MCSHERRY: Congress could do that, but I don't think that's actually what Congress did. Now, what the CFR said, it went through a lot of the 22 arguments, and it said we think it's beyond our authority to 23 do what the petitioners, including my client but not just my 24 client, want us to do. 25 interpret reasonable availability in the way you want to. We think it's beyond our authority to 60 1 We think that it will cause problems for the agencies in 2 terms of monitoring compliance. 3 but those concerns don't apply here, because what we have here 4 is my client who's willing to make these standards available 5 right now, very easily, and it doesn't depend on any agency 6 action whatsoever. 7 Just two final points. So they had various concerns, Again, with respect to the takings 8 question, what I would like to say about that is, in addition to 9 the fact that I don't think it's a credible concern given the 10 tremendous benefits of incorporation by reference, aside from 11 the ability to sell the standards -- which, by the way, most of 12 the standards aren't much used anymore anyway except for as law. 13 But the other thing that I think we can say with respect to 14 takings is that essentially that's a different process. 15 Veeck case, in the wake of the Veeck case, we didn't see a 16 takings claim, and if the standards development organizations 17 want to try to bring a takings claim, which I think, again, is 18 unlikely, if they were to bring it, that's a whole separate set 19 of facts to present to the court. 20 21 THE COURT: In the Let me ask you a question regarding the merger analysis. 22 MS. MCSHERRY: 23 THE COURT: Sure. Could I find that the standards lost 24 copyright protection under the merger doctrine but not find that 25 they've lost protection by becoming law? Could I do both those 61 1 things? 2 3 MS. MCSHERRY: I think that -- so the -- you mean once they've been incorporated by reference? 4 THE COURT: Right. In other words, could I find that 5 they retain their protection by becoming the law, but they lose 6 protection under the merger doctrine? 7 MS. MCSHERRY: I think that you have to say that they 8 lose protection under the merger doctrine because they become 9 ideas, and the idea and the expression merge. 10 Essentially, they become facts. 11 THE COURT: Okay. Is your merger approach a separate 12 theory or just a subpart of your public domain theory? 13 it wasn't clear to me. 14 MS. MCSHERRY: Okay. Because I tend to think they go 15 together. 16 really I think the way the Veeck court tried to conceive of it, 17 which is first we have our due process concerns. 18 that case law, we have to say that anything that's been 19 incorporated into law, made regulation, is out of copyright; and 20 so Veeck could make a copy of the law -- and the court stresses 21 that at 800 -- could make a copy of the law under Banks and 22 related cases. 23 The way that I conceive of them is that the first is And following But then the second portion of the analysis is to then look 24 to the Copyright Act and see if there's a way to reconcile that 25 fact with what already exists in the Copyright Act. So the 62 1 Veeck court turns to the merger doctrine and says, in addition, 2 even if -- the quote is, even if Banks fails, I can still look 3 to merger to find that these model codes have been incorporated 4 by reference into law, and therefore the idea and expression 5 have merged. 6 Constitution. 7 If you don't have further questions -- sorry. 8 9 They're facts like the tax code, like the THE COURT: You do. Well, the scènes à faire doctrine, I have to confess I'm not quite sure how it's applicable here. Are you 10 arguing that if somebody tried to write their own standards on 11 the exact topic as one of the standards here, they would still 12 have to be identical down to the word choice and the punctuation? 13 Is that my understanding? 14 argument on this. 15 MS. MCSHERRY: I was a little confused by your So that argument in particular goes to 16 the copyrightability of the standards as such, and our argument 17 is that if you look at how they're created, they're very much 18 shaped by external factors that are external to the sort of 19 creativity of anyone involved in drafting them. 20 THE COURT: 21 MS. MCSHERRY: 22 THE COURT: 23 Oh, I'm sorry. Okay. All right. Okay. Thank you, Your Honor. Thank you. My court reporter needs a break. 24 going for -- and we're running behind. 25 along. He's been We just keep plowing 63 1 (Recess from 10:44 a.m. to 10:54 a.m.) 2 MR. BRIDGES: 3 THE COURT: 4 MR. BRIDGES: 5 Good morning, Your Honor. Good morning. I'm Andrew Bridges, also representing Public.Resource. 6 THE COURT: Good morning. 7 MR. BRIDGES: And I will address fair-use issues, 8 which are vitally important to the case. 9 statements that I'd like to make -- 10 THE COURT: Before I get to my Oh, and I have pushed my meeting to 1:00, 11 which means we're only five minutes behind instead of half an 12 hour or something. 13 14 MR. BRIDGES: Thank you, Your Honor. Before I get to my own point, I wanted to address something 15 that Mr. Klaus said on the other side: 16 of fair use has endorsed an entire work being made available 17 widely for download or distribution. 18 No case in the history Well, I'd like to call the Court's attention to a number 19 of cases that did exactly that. 20 various United States Courts of Appeal. 21 Important cases. Cases from I refer to the Court to Nuñez v. Caribbean International, 22 First Circuit. Full copies of original pictures of a model 23 were widely disseminated by a newspaper when it became 24 newsworthy that this model, who had some racy photos, had become 25 Miss Universe Puerto Rico. The First Circuit found fair use 64 1 2 from that widespread publication of the full photos. The Second Circuit, in Swatch Group v. Bloomberg, found 3 fair use the widespread online dissemination of materials from 4 investor conferences that Swatch Group claimed a copyright in. 5 THE COURT: But the Swatch case in particular, that 6 was the case where the conference call was closed, and without 7 the dissemination of the materials, the materials would not have 8 otherwise have been accessible, the information. 9 MR. BRIDGES: That's a different point, Your Honor. 10 What Mr. Klaus said is there is no point in the history of fair 11 use where an entire work was disseminated broadly to the public. 12 His point was an entire work plus public dissemination. 13 wasn't about the nature of the original work or the circumstances 14 of the original work. 15 It But to address your issue, the Ninth Circuit in 16 Hustler v. Moral Majority, where Larry Flint had basically sent 17 up Jerry Falwell in Hustler magazine, and Moral Majority, only 18 bleeping out some obscene or offensive words, disseminated 19 widely for fundraising purposes the entire item featuring 20 Mr. Falwell. 21 Righthaven v. Jama. Now, I've given you appellate cases, 22 but there's also an important case out of the District of 23 Nevada, 2011. 24 widespread public dissemination of an entire article from the 25 Las Vegas newspaper. Righthaven v. Jama found fair use in the 65 1 So the notion that fair use doesn't allow widespread 2 dissemination of an entire work is simply wrong, and Mr. Klaus 3 referred to the HathiTrust decision in the Second Circuit 4 because that case does talk about certain security features that 5 HathiTrust imposed. 6 incidental to that one decision, and it's wrong to ignore all of 7 these decisions that do allow entire works broadly disseminated. 8 9 But that's not necessary. THE COURT: That was And that may be, but how is that germane to this discussion here? In this case, there's no evidence that 10 has been proffered that the standards at issue weren't otherwise 11 available. 12 for a situation in which, absent the fair use of the material, 13 the information would not otherwise be accessible. 14 I can definitely see a fair-use argument being made MR. BRIDGES: Your Honor, whether they are otherwise 15 available actually doesn't make a defense to fair use at all. 16 It really doesn't. 17 wanted to address the cases -- 18 THE COURT: And I'll go through the standards. I just So is it your position that -- where's the 19 line drawn? 20 the latest Harry Potter book is coming out and it's copyrighted, 21 can you download the entire book and make it available to the 22 public? 23 I can -- you know, if there's a book coming out, No. MR. BRIDGES: 24 our argument. 25 factors. Likely, no. And that's nothing close to I think it might be helpful if I go through the I just wanted to rebut the point that Mr. Klaus had 66 1 made that there had been no case in the history of fair use 2 about entire works being disseminated. 3 THE COURT: That's less important to me. 4 MR. BRIDGES: So let me just explain. All right. First of all, 5 I think the parties agree that fair use is amenable to summary 6 judgment, and we have summary judgment in Nuñez and Authors 7 Guild v. Google. 8 outside the statutory monopoly of copyright. 9 It's important to understand that fair use is Section 106 gives the rights of the copyright author, and 10 the section starts with the wording, "Subject to § 107." 11 fair use. 12 That's Section 107 states fair use. It says, "Notwithstanding the provisions of § 106, fair use 13 is not an infringement of copyright." 14 between the rights of the author and fair use. 15 therefore, takes nothing away from a copyright holder because 16 the rights of a copyright holder don't extend into fair use 17 anyway. 18 THE COURT: There's a boundary zone Fair use, How is downloading a set of copyrighted 19 standards in their entirety and placing them on the Internet for 20 free fair use under the definition of fair use as I have it? 21 MR. BRIDGES: Well, Your Honor, to begin with, 22 let's talk about the structure of fair use in the statute. 23 The statute says there are four factors to be taken into 24 account; and it specifies the factors, and I will go through 25 them. Campbell v. Acuff-Rose also explains that the task of a 67 1 court is to analyze all four of those factors in light of the 2 constitutional purpose of copyright, which is to promote the 3 progress of science in the useful arts. 4 So let's go through those factors, and I will say this. 5 You've heard about some constitutional issues. 6 Court has said, fair use as a doctrine brings First Amendment 7 considerations into the Copyright Act. 8 Amendment accommodations. 9 As the Supreme It has built-in First So the first nonexclusive statutory factor -- let me back 10 up. 11 examples of paradigmatic fair use in the introduction to the 12 section. 13 examples, "is not an infringement." 14 factors. 15 Section 107 gives the four factors. It also gives several It says, "Fair use, including" and it has several And then it gives the The first factor is the purpose and character of the use. 16 This is the defendant's purpose and character of the use, and 17 the purpose and character of Public.Resource's use is for a 18 very, very important public benefit. 19 It says what the law is. 20 Public.Resource distributes, that is underscoring -- it's making 21 a political point. 22 It is to report the law. When you saw that certificate that It says, This is law. THE COURT: But the point of the matter is, this law 23 as you call it, these standards, are available in libraries. 24 They're available in the Office of the Federal Register. 25 They're available in reading-room online sites. What you're 68 1 doing is making the standards available for downloading by 2 someone who, for example, could download the standards and sell 3 them; right? 4 MR. BRIDGES: 5 THE COURT: That is not the purpose. Right. You have purpose, and then you 6 have reality. 7 we're back to the framers -- decided that copyright existed to 8 give the benefits of ownership to people who created material so 9 that people would continue to create material. 10 And Congress decided that, and the framers -- and Congress decided not to strip copyright protection for all 11 material that was referenced by law, for that same reason, 12 because, otherwise, people would stop promulgating these 13 standards or people would stop promulgating whatever it was that 14 was being incorporated by reference. 15 But what you're saying is, because our purpose is noble and 16 good, then it's fair use. 17 noble and good, but despite that, you are stripping the 18 creators, the owners of the copyrighted material, of commercial 19 use of their product. 20 MR. BRIDGES: The problem is, your purpose may be Your Honor, the Supreme Court did 21 exactly that. It incorporated the full lyrics of "Pretty Woman" 22 in the opinion of Campbell v. Acuff-Rose, and if my purpose is 23 to distribute copies of that opinion and some people use it to 24 get access to the lyrics of that song, well, that wasn't my 25 purpose. It's not chargeable to me. But the Supreme Court put 69 1 the full lyrics in its opinion, and I'm allowed to have my 2 purpose. 3 THE COURT: But the Supreme Court, somewhere in there 4 there was an opinion. 5 opinion, but the purpose of that publication of the lyrics was 6 because they were involved in a Supreme Court opinion. 7 not doing anything but lifting these standards wholesale and 8 putting them on a website. 9 The lyrics of the song were part of the MR. BRIDGES: You're Your Honor, that comes to the third 10 factor of fair use, and I will go there. 11 third factor, as I think Campbell says and as HathiTrust says, 12 the third factor on amount and substantiality of use depends on 13 the first factor, what the purpose is. 14 Well, actually, the The third factor, the amount, depends on the purpose. 15 what's the purpose here? 16 all the focus has been. 17 make the law amenable to research and scholarship. 18 It's to report the law. And That's where The purpose of the defendant is also to One can do textual analysis, data analysis on these that is 19 not available in any other way. 20 reformatted into HTML. 21 in a way that the reading rooms can't be done. 22 Your Honor, they've got a document that basically talks about 23 how they're making the reading rooms inconvenient. 24 purpose, is to make it inconvenient so that they can sell it. 25 That's why these were They are word searchable by the public The reading rooms, That's their Public.Resource's purpose is to make the law available to 70 1 the public, and there is no other way to make the law available 2 to the public than by presenting the law itself. 3 factor. 4 It is a It goes to the merger point Your Honor made earlier. When something becomes the law, that text is now a fact. 5 It is the law. 6 that they are text searchable and so that they are accessible to 7 the blind. 8 something that the plaintiffs haven't done because of what the 9 defendant has done. 10 11 12 So Public.Resource is getting these re-keyed so It wasn't the sole purpose by any means, but it's THE COURT: Public.Resource started doing that after this lawsuit was filed, didn't it? MR. BRIDGES: No. I believe it was done beforehand, 13 Your Honor, and it's been part of the process. 14 is to facilitate research and scholarship. 15 foster inclusive access for persons to this. 16 Now, the purpose is also noncommercial. So the purpose The purpose is to Public.Resource 17 is not trying to go into competition with the plaintiffs. 18 Remember that the only standards that Public.Resource has acted 19 on are standards that have become law. 20 competing with the thousands of standards that they do. 21 about 250 standards, roughly. 22 This is not about This is Commerciality does enter into the first factor of purpose 23 and character here, and Campbell v. Acuff-Rose, that was 24 commercial. 25 Bloomberg was highly commercial. The Supreme Court endorsed it. Swatch Group v. The Second Circuit endorsed 71 1 it. Nuñez v. Caribbean International, highly commercial. 2 The First Circuit endorsed it. 3 I'd like to go to another important aspect of the purpose 4 and character of the use, and that's the transformative use. 5 What's important here is that transformative use means a new and 6 different use or purpose. 7 be different. 8 there was no change in the work itself, but the original work 9 was used for a new and different purpose. 10 It does not mean that the work has to In all the cases I've been discussing up to now, For example, there's a Fourth Circuit case, Bond v. Blum, 11 where one party in a child custody case took an entire 12 autobiographical manuscript of one of the parties and put it 13 before the Court. 14 fact. 15 It was a different purpose because that was a Now, here's an interesting question, Your Honor. 16 I think the other side has skirted the issue. 17 purpose, Public.Resource's purpose, to the plaintiffs' purpose 18 in creating their standards. 19 write law? 20 similarity of purpose, and if their purpose was to write law, 21 then they're falling into deeper and deeper Veeck and BOCA 22 problems. 23 Let's match our Was the plaintiffs' purpose to If their purpose was to write law, then we have a But if, as they say, oh, but we had all these purposes 24 that had nothing to do with the law, we had best-practices 25 purposes, we had contractor purposes, then the law purposes of 72 1 Public.Resource are very different, and that's an important 2 point here. 3 very different. 4 They are not competing. THE COURT: These purposes are very, What's the line between transformative and 5 not transformative here? 6 copy standards to a searchable PDF but had only posted on your 7 website that it was available for free upon request, would that 8 have been transformative? 9 MR. BRIDGES: I mean, if you had converted the hard- Your Honor, it's transformative 10 because it is for a different purpose and a different use. 11 The conditions of that use don't affect the issue. 12 different purpose, a different use. 13 THE COURT: It was a If the PDF versions that plaintiffs sold 14 were also searchable -- in other words, if plaintiffs sold a 15 searchable PDF version, is the only transformative aspect of 16 your posted PDF standards the cost, that it's free? 17 MR. BRIDGES: No, Your Honor. I have to say very 18 clearly: different use, different purpose to make the law 19 available. 20 THE COURT: I understand that. I understand that. 21 I'm asking with regard to the transformative-use issue. Putting 22 aside the purpose, if you said you can get this if you ask for 23 it, or if plaintiff also offered what you're offering but it 24 cost money, isn't the law being reported? 25 reporting the law that you want to do. It's not just You want to do reporting 73 1 the law for free; right? 2 MR. BRIDGES: 3 THE COURT: 4 MR. BRIDGES: Because the law is free. Yes. Absolutely. Right. Because we believe that no private 5 party should be exercising a private monopoly over the law, and 6 it is not just about seeing the law; it is about speaking the 7 law. 8 9 It is about analyzing the law. It is about critiquing. They said critiques can be transformative. Great. Critiques can be transformative only if you have access to be 10 able to critique them. They're saying you have to pay them to 11 critique them, or you have to maybe go to one or two places in 12 the United States. 13 gave you about library access -- And by the way, the statistics that AERA 14 THE COURT: Right. 15 MR. BRIDGES: We're running behind. All right, if I can get back. The point 16 is, part of the purpose here is to facilitate public discourse 17 about the law without people having to pay a toll in order to 18 know what the law is or without having to go to Washington, 19 D.C., to get access or to have to pay them $49 to know what the 20 law is in order to critique it. 21 There's a very, very important political point here, that 22 there should not be -- in this public-private partnership that 23 they have discussed, there should not be private dominion over 24 public law. 25 THE COURT: And there's a very big, white marble 74 1 building about two blocks away where you make those political 2 points, not in the district courts. 3 MR. BRIDGES: 4 THE COURT: 5 I know, Your Honor. Aren't you just in the wrong forum for that point? 6 MR. BRIDGES: Absolutely not. This is exactly the 7 right point. 8 because Congress set factors precisely for courts to use. 9 a flexible doctrine for courts to analyze on a case-by-case 10 basis. 11 This is the right place for the fair-use argument, It's That is what § 107 is. It says, "Here you go, courts. Here's the standard. Have 12 at it." 13 fair-use law that is understood to be the proper dominion of the 14 courts. 15 a different point about the determination of copyrightability. 16 But when it comes to fair use, courts are the very, very center 17 of that focus. 18 And there is a rich, rich jurisprudence of judge-made, That's why we're talking about fair use. Your point is I need to talk, though, because you are concerned about 19 some of the substitution effect. 20 I want to get to the second factor, and that is the nature of 21 the copyrighted work. 22 Actually, before I get there, Now, the nature of the copyrighted work, when it is adopted 23 for dissemination by Public.Resource, at this point it is the 24 law. 25 best practice. This is not merely -- this is not merely some building The nature of the work, when it enters into 75 1 Public.Resource's world, it is the law. It is the fact of law. 2 So Public.Resource is reporting facts, and these are things that 3 had been publicly disseminated to the public. 4 actually weighs in favor of fair use, not against fair use. 5 Harper & Row, there was no fair use because a private, Okay? That 6 nonpublic manuscript was purloined. 7 wedding pictures that were purloined. 8 publicly available weighs in favor of fair use because there's 9 no preemption of the first publication availability. 10 11 The Mange case was private The fact that they were That weighed on the court in Harper & Row. I must say this, Your Honor: The works that are on PRO's 12 website, Public.Resource's website, almost all of them -- it may 13 be one or three or four out of maybe 250 -- have been superseded 14 for their purposes. 15 are still the law. 16 They are still the law, but they are not their current standards. 17 They are not the current standards. They That's why it matters to Public.Resource. So Public.Resource isn't interested in their standards as 18 standards. 19 is a huge point that the second factor, the nature of the 20 copyrighted work, is in this case -- they are obsolete or 21 obsolescent standards, by their standards, but the nature of the 22 copyrighted work insofar as Public.Resource is interested in it 23 is because it's still the law. 24 THE COURT: 25 Public.Resource is interested in the law. So this But once the 2014 standards become incorporated by reference, you're going to want to put those up 76 1 as well; right? 2 MR. BRIDGES: Yes. All the same reasons, and for 3 salutary reasons. 4 to discuss -- the third factor is the amount and substantiality 5 of the work compared to the original, yet it does turn on what 6 the purpose is. 7 It's entirely appropriate. I would also like Again, at the beginning of my time I gave the Court five or 8 six cases, most of them from circuit courts, where the entire 9 work was used. 10 11 That doesn't weigh against fair use when the purpose is to present the law as law. There is no way of saying, well, we'll give you a summary 12 of the law. 13 executive -- I've forgotten the company. 14 went to prison for violating a standard that was incorporated by 15 reference. 16 what the law is, you have to give the whole thing. 17 People don't have to obey a summary. Went to prison. There was one One prominent executive If you're trying to make public Finally, I do want to talk about the fourth factor, which 18 is the effect of the use on the potential market for or value of 19 the copyrighted work, and this is where I think they are saying, 20 oh, look, we're going to lose business. 21 they're going to lose business. 22 You're concerned that First of all, this factor focuses on loss to the copyright 23 value, not losses to other values. The factor must focus on the 24 standards at issue in this case. 25 they use some experts to try to talk about substitutive effect, What's interesting is when 77 1 for reasons we can just talk about in motions to strike, the 2 experts shot air balls with extraordinary mistakes. 3 For example, Mr. Geisinger for AERA attributes the decline 4 of sale of standards to Public.Resource, missing the fact that 5 the catastrophic decline that he's looking at began a year, year 6 and a half before Public.Resource ever posted anything. 7 As a matter of fact, the sale of the standards appeared 8 to go back up towards the end of the time that Public.Resource 9 had it up there. There is no real evidence of the loss. And 10 when they talk about the harm, they talk about loss of control. 11 They don't have real numbers about any substitution effect. 12 They don't. 13 THE COURT: Well, are you really arguing that it's not 14 rational to conclude that if their standards are available for 15 free for anyone to download off the Internet that people aren't 16 going to buy them? 17 That's a logical conclusion, isn't it? MR. BRIDGES: No, Your Honor. It's a speculative 18 conclusion, exactly the sort of speculative conclusion that the 19 Supreme Court rejected in the Sony Betamax case. 20 that, oh, people are going to stop watching live TV and they're 21 going to stop watching movies because of the Betamax, and the 22 Supreme Court expressly rejected that as speculative. The argument 23 And we have ASTM's president, Mr. Thomas, stating that we 24 have seen no measurable effect from Public.Resource's actions. 25 We have seen no measurable effect, and they have substituted 78 1 2 hypothesis, conjecture. The point is, what is expanding is access. Yes, there are 3 accesses to these. 4 more people are seeing, reading, speaking, analyzing the law. 5 More access is a good thing. 6 evidence of actual losses, and we have ASTM's president 7 admitting no measurable effect. 8 9 10 11 That's very good, because that means that They have not shown any competent Your Honor, I think I'd like to say one -THE COURT: You need to make it brief. MR. BRIDGES: -- more thing. That's right. I would like to come back, however -- we've got the four 12 factors in fair use, and it is the Court's province, emphatically 13 the Court's province on fair use. 14 fair-use cases. 15 that Congress could have adjusted copyright law, but Congress 16 has expressly given the courts authority over fair use because 17 it's an equitable case-by-case doctrine. 18 That's why we have all these People could have argued in all of those cases But as Campbell v. Acuff-Rose made clear in the Supreme 19 Court, it's the job of the courts to analyze the four factors in 20 light of the constitutional purpose of copyright, which is to 21 promote the progress of science in the useful arts. 22 To promote the progress of science in the useful arts means, 23 in the case of law, the study of law, the critique of law, and 24 the education about the law, giving full public access to the 25 law and ruling that whatever statutory monopoly they have over 79 1 their building standards, they do not have a private monopoly 2 over the law. 3 statutory boundary between the rights of the copyright holder 4 and fair use. 5 We have this important carve-out. It's a So we ask Your Honor to look at these factors and to 6 understand that this purpose is a laudable and appropriate 7 purpose. 8 It is the law. 9 fact. The nature of the work is as factual as it could be. Your Honor could rule that it is merged; it is You could rule that there's no copyright at all. But 10 fair use allows a pressure valve here. 11 uncomfortable ruling that it's not copyrighted, fair use is 12 exactly how to accommodate the concerns on both sides. 13 Thank you, Your Honor. 14 15 If the Court is MR. HUDIS: rebuttal. Your Honor, we did reserve some time for I will take less than five minutes. 16 THE COURT: All right. 17 MR. HUDIS: Your Honor, I'll just take the issues that 18 are of most concern from the presentations from Public.Resource. 19 First, with reference to the BOCA case at page 736, in remanding 20 the case for further argument after reversing the preliminary 21 injunction, the case says, "The rule denying copyright 22 protection to judicial opinions and statutes grew out of a much 23 different set of circumstances than to these technical 24 regulatory codes." 25 All right. As to our standards being off sale for a time, 80 1 as we discussed, Your Honor, they were still available in 2 thousands of libraries, and if one could not get it from one 3 library, there's an inter-lending program between libraries. 4 Your Honor, Public.Resource is asking this Court to 5 substitute its judgment for the will of Congress. 6 spoke about one of the exceptions to copyright. 7 number of exceptions to copyrighting, sections 107 through 121 8 of the Act, and Congress, through all of this, has not seen fit 9 for a special exception to copyright that Public.Resource now 10 11 Mr. Bridges There are a would like to introduce. As to the external factors in creativity, in their 12 briefs and in responses to our statement of material facts, 13 Public.Resource has already conceded that we have copyrightable 14 content in our book. 15 of that case was to guard against entire dissemination essential 16 to the court's decision. 17 The HathiTrust case, the central holding Mr. Bridges brings up the fact that HTML and OCR coding 18 were done of the standards. 19 as a standard graphic PDF. 20 Not in our case. It just went up Now, you asked about the dividing line between what is and 21 what is not transformative. Your Honor, if you could look to 22 the Leval article where all of this transformative language 23 originated, cited by the court in Campbell v. Acuff-Rose, it 24 says the mere repackaging and republishing of the original does 25 not pass that test. 81 1 And finally, as to the alleged obsolescence of our 2 standards, Your Honor, those standards are still valuable today 3 for any test that was promulgated between 1999 and 2014, and 4 those standards are still applicable today. 5 sale today, and what Public.Resource is doing would endanger our 6 income to further promulgate standards in the future. 7 They are still on Thank you, Your Honor. 8 THE COURT: Thank you, Mr. Hudis. 9 MR. KLAUS: Thank you, Your Honor. 10 All right. Mr. Bridges misheard me on fair use, because I did not say 11 there's never been a case in the history of fair use that has 12 not said that the copying of a work -- a work -- would not be 13 fair use. 14 What I did say was that there's never been a case in the 15 history of fair use that has said setting up an entire business 16 of the repeated copying and distribution of entire works would 17 be fair use. 18 Authors Guild v. HathiTrust case made it clear that would not be 19 acceptable. 20 And, in fact, the Authors Guild v. Google and Mr. Bridges also said there's no evidence of actual 21 substitution, actual market harm. I would simply give cites 22 to Your Honor to places in the record. 23 paragraphs 11 through 12, which talk about people disseminating 24 entire PDF copies of the works. 25 Public.Resource alone makes the works available in HTML or text- Mr. Berry's declaration, Mr. Bridges also said that 82 1 2 searchable format. In fact, if you look at Mr. Thomas's declaration at 3 paragraph 44, what he says is that they actually make their 4 standards available in text-searchable format. 5 is -- as does my client, NFPA. 6 somebody wants that, that's a different format that they pay the 7 right for. 8 9 The difference The difference is that if Finally, I'd like to go back to Ms. McSherry's point on the Veeck case. Two things to note about it. One is an entire 10 section of that that talks about the difference between model 11 codes and extrinsic standards. 12 "sole purpose" language, which is the qualifier which the Veeck 13 court, which the defendant is relying on, put on to that 14 distinction. 15 I've discussed why I think the I would also point out that that was in response -- that 16 entire discussion in Veeck was in response to amici filings, 17 not just by anyone, but by my client, by ASHRAE. 18 qualification that the Court put on. 19 That was the Happy to answer any other questions. 20 THE COURT: Thank you. 21 MR. KLAUS: Otherwise, I'll just move on, Your Honor. 22 THE COURT: Thank you, Mr. Klaus. 23 All right. And, again, we are still very much behind, so 24 I'm going to ask, let's be as concise as we can. 25 argue on behalf of ASTM on ownership? Who's going to 83 1 MR. FEE: Your Honor, I'm Kevin Fee from Morgan Lewis 2 on behalf of ASTM and on behalf of all of the plaintiffs in the 3 ASTM case. 4 THE COURT: 5 MR. FEE: All right. Good morning. Your Honor, Ms. McSherry started off the 6 defendant's presentation by saying the core of this case has 7 always been about whether or not incorporation by reference 8 destroys the copyrights on standards written by private 9 organizations, and we agree. 10 Having said that, plaintiffs understand they have the 11 burden of proving that they own the copyrights in this case, but 12 the defendants have spent over three years trying to concoct 13 arguments about why there are some holes in the ownership here. 14 THE COURT: Well, let me ask you. Does the 15 registration certificate for the 1999 Annual Book of Standards 16 create the same rebuttable presumption of ownership for D39698 17 and D1217-93(98) as the registration certificates for those 18 specific standards? 19 different from the others. 20 Is that in the record somewhere? 21 22 MR. FEE: And I single those two out because they're No, Your Honor. They're part of a compilation registration for the Book of Standards. 23 THE COURT: 24 MR. FEE: 25 Are those copyrighted individually? Okay. And, first of all, I want to note that the reason you're probably asking this question is we didn't have an 84 1 opportunity to address this in our briefing. 2 the final brief by Public.Resource. 3 might have that question, I have the answer here for you. 4 It was raised in But anticipating that you The Book of Standards' collective registration covers all 5 the individual works contained in that collection under a series 6 of cases that have found that where an owner of a collective 7 work also owns the copyright and the constituent parts of that 8 collective work, that the registration for that collective work 9 covers both the collective work and the constituent parts. 10 11 Just a couple of citations for that. There's the Xoom v. Imageline case. 12 from the Fourth Circuit. 13 Concepts case, 259 F.3d 65. 14 That's 323 F.3d 279 site, Second Circuit, 2001. 15 THE COURT: 16 MR. FEE: There's also the Morris v. Business That's at page 68 for a pinpoint All right. So, because the Book of Standards were 17 timely registered within five years of the first publication, 18 then we are entitled to a presumption of ownership and validity 19 with respect to those works as a result of that collective 20 registration. 21 THE COURT: 22 MR. FEE: All right. So getting back to where I was a moment ago, 23 we've gone through three years of litigation in this case now, 24 and Public.Resource still has not been able to come forward with 25 any evidence to rebut the presumption of ownership that we're 85 1 2 entitled to from those registrations. The simple fact is they have no evidence that anybody other 3 than the plaintiffs in this case owns these works, and that's 4 particularly important, I think, Your Honor, because there have 5 been literally thousands of participants who have been involved 6 in the creation of these works. 7 the subject of a lot of publicity in the standards-development 8 community. 9 And this litigation has been And despite, I'm sure, the efforts by the defendants, 10 everybody's awareness of these issues, not a single person in 11 the thousands and thousands of participants who have ever been 12 involved in the development of standards for these plaintiffs 13 has been identified by the defendant as saying, you know what, 14 I am the owner and exclusive owner of the copyrights of any of 15 those works. 16 And I think it's also important to note that it isn't good 17 enough for them to poke a hole and then say, oh, you didn't get 18 a perfect assignment from this one person out of the 10 people 19 on this committee. 20 They can't defend their infringement by saying the 21 plaintiffs in this case only owned 80 percent of the copyright 22 interest of the works in issue. 23 plaintiffs owned literally no copyright interest in the 24 standards at issue in order for them to have a defense based on 25 ownership. They have to prove that 86 1 THE COURT: If I didn't find that you were entitled 2 to the presumption on all the standards, have you sufficiently 3 demonstrated a specific author of each of the six standards has 4 assigned their ownership stake to you? 5 MR. FEE: Well, Your Honor, there's a couple ways we 6 have ownership other than the presumption that arises from this 7 registration. 8 plaintiffs in this case that their employees made contributions 9 to these works. 10 First of all, we submitted evidence from all the There's no dispute that if they made contributions in the 11 course of their employment, then the plaintiffs in this case 12 would own at least that copyright interest as a result of the 13 work for hire doctrine, and as I pointed out before, as long 14 as we own some ownership interest in the copyrights, that's 15 sufficient for us to prevail in this claim. 16 In addition, we have also provided evidence related to 17 assignments as well. 18 the 2014 National Electrical Code. 19 defendants don't contest the validity of the ownership of the 20 NFPA with respect to that code, because there's clear 21 documentation that they agreed to be works for hire and that 22 anything that wasn't a works for hire was assigned. 23 Maybe the most clear instance of that is I believe even the But even with respect to the other works, I know, for 24 example, with respect to ASTM, we identified specific language 25 that were authored by employees of ASHRAE works for hire. And, 87 1 in addition, we do have assignments from some of the persons who 2 were involved in the development of those works. 3 In particular, I have the declarations of a couple of 4 individuals, Mr. Jennings and Mr. Cummings, I believe his name 5 is, who have identified their role in developing certain of 6 these standards. 7 They've clarified that they understood from the start that 8 those standards were going to be owned exclusively by ASTM, and 9 to the extent there was any complaint about documentation with 10 respect to the assignments, we've confirmed and provided 11 evidence that they did do the click-through assignments that are 12 part of the ASTM renewal of memberships every year which 13 provides that everybody understands that they have assigned all 14 of their copyright interest in any of the works that they were 15 involved in to ASTM. 16 So, because Public.Resource cannot meet its burden of 17 overcoming the presumption of ownership arising from the 18 registrations, they do spend a fair amount of time trying to 19 argue that they're not entitled to a presumption in the first 20 place. 21 in the completion of the copyright registration forms that 22 somehow the presumption goes away. 23 They argue that because there was a mistake, supposedly, But as we pointed out in our briefs, the overwhelming 24 amount of case law stands for a proposition that even if there 25 are mistakes in a registration, that does not affect the 88 1 plaintiffs' ability to bring the lawsuit or the presumption of 2 validity and ownership that accompany that registration unless 3 two factors are met. 4 First, the mistake has to be material, and secondly, the 5 mistake has to be made with the intent to defraud the copyright 6 office. 7 requirements. The defendants in this case cannot be either of those 8 First of all, identifying the works as works made for hire 9 was not a material mistake because it's undeniable that even if 10 we had identified those works as joint works with us being one 11 of the authors, that the copyright registration would have 12 issued. 13 where a court found that a work made for hire form from the 14 registration was not materially impacted by the fact that it was 15 really not a work made for hire, but the plaintiff still had an 16 ownership interest in that work. 17 So we cited a brief in our case on that point exactly And certainly there's no proof of an intent to defraud the 18 copyright office. In fact, the only evidence with respect to 19 intent on how these forms were filled out was the evidence that 20 ASTM had contacted the copyright office to describe the 21 circumstance and ask the copyright office for guidance as to how 22 to complete these forms. 23 that the proper mechanism under these circumstances was to claim 24 a work for hire, so there's neither a material mistake nor an 25 intent to defraud the copyright office. And the copyright office told ASTM 89 1 There is one case, I believe from the Third Circuit, that 2 Public.Resource cites for a proposition that fraudulent intent 3 is not required, but even that case does not stand for that 4 proposition. 5 The court sort of left open the question of whether intent 6 in the Third Circuit alone is required to eliminate the 7 presumption of validity and ownership, but it did not decide the 8 issue, because it doesn't have to. 9 have been cited, Your Honor, stand for the proposition that they All the other cases that 10 both have to be material mistakes and made with the intent to 11 defraud. 12 So I think the easiest way to sort of support a factual 13 finding of ownership here, as I mentioned, in addition to the 14 presumption that arises from the registration, is the joint 15 authorship point. 16 copyright statute as a work that is prepared by two or more 17 authors with an intention that their contributions be merged 18 into inseparable or interdependent parts of a unitary whole. 19 In this case, there can be no dispute that all the 20 participants in the standards development organizations 21 understood that these works would be combined into a single 22 standard at the end of the day, and Public.Resource does not 23 argue otherwise. 24 under § 101 of the Copyright Act, that's all that's required for 25 a joint work. A joint work is described or defined in the So, under the plain meaning of the language 90 1 Public.Resource does try to argue that any copyright or 2 any contributions by the plaintiffs' employees in connection 3 with this matter were not copyrightable, but they provide no 4 evidence for that assertion. 5 There's no description in their brief, for example, as to 6 why the contributions that we've identified that were made by 7 employees with respect to D975 are not protectable or 8 copyrightable. 9 in their briefs, and they have an obligation to overcome the They don't mention any of these standards at all 10 presumption that those are not copyrightable. 11 even tried to do so. 12 They just haven't Now, Public.Resource also tries to get around the joint 13 authorship issue by relying on Aalmuhammed, a Ninth Circuit 14 case, for the proposition that joint authorship requires more 15 than just an intent of all the authors to combine their 16 contributions into a single unitary work, but it also requires 17 an intention at the time of the creation that the parties 18 understand that they will both jointly own the work. 19 is certainly not the law in this circuit, and it is not the law 20 according to the United States Supreme Court. 21 But that In the CCNV case, the D.C. Circuit addressed a very similar 22 issue where there is a dispute between two parties who were 23 involved in the creation of a sculpture. 24 point in time, filed applications to register, so they certainly 25 didn't have a joint understanding that this work was going to be Both parties, at some 91 1 jointly owned at the time. 2 The D.C. Circuit described those facts, if they remained to 3 be the same after a remand, to be a textbook example of jointly 4 authored works in which the joint authors co-owned the copyright, 5 because one party basically did the sculpture of the person; the 6 other party did the sculpture of a grate. 7 were going to be put together in a single unitary work, and that 8 was all that was required for there to be joint authorship. 9 Everybody knew they Now, that case, of course, did go up to the United States 10 Supreme Court as well, and the Supreme Court agreed with the 11 D.C. Circuit's assessment of the parties' rights under those 12 circumstances. 13 if they prepared the work, intending that their contributions 14 be merged into a separate or interdependent whole, and nothing 15 else. 16 It said that the parties would be joint owners There was no discussion about an intent requirement. Now, I know we're running very short on time, so I'm just 17 going to deal very briefly with assignments. 18 get up, they're going to tell you somebody didn't sign a form or 19 this language isn't appropriate for this particular form that 20 they're going to show you. 21 I'm sure when they The problem that they have, among many, with respect to 22 those arguments is they have the obligation, in light of their 23 presumption of ownership, to show that every single participant 24 who was involved in creating that work did not sign a form that 25 assigned those works to the plaintiffs in this case. I don't 92 1 know what forms they're going to show you, but in their briefing 2 they certainly have not linked any of the forms that they 3 complained about to any particular works at issue in this case. 4 For example, they haven't come forward and said, here are 5 the authors of D975; let me show you the assignment forms for 6 all those. 7 required to be signed in order to assign ownership. 8 9 None of those people signed the forms that were The bottom line is, with respect to the ownership, there are no magic words with respect to assignment. The intention of 10 all the parties is clear. 11 these works for over a century in some circumstances, always 12 claiming to be the owner of the copyrights. 13 come forward and said otherwise. 14 evidence of anybody ever claiming ownership, and as a result, 15 they just can't meet their burden with respect to any complaints 16 about assignment. 17 These plaintiffs have been publishing Nobody has ever Public.Resource has no But maybe even more importantly, they don't have the right 18 to raise this argument. 19 cannot defend your copyright infringement by saying, oh, I 20 infringed a copyright, sure, but it's not the plaintiff's 21 copyright; there's some defect in the assignment that entitles 22 me to copy their works without any consequences. 23 The courts have made it clear that you The courts have said that the point of the statute of 24 frauds, a provision essentially of the Copyright Act that 25 requires assigned writing, is to prevent disputes between 93 1 authors or claimed authors about who owns the rights in the 2 works. 3 claim to be an author in this case, and as a result doesn't have 4 standing to raise this issue. That is not what we have here. Public.Resource does not 5 Courts have -- we've submitted a bunch of cases to 6 Your Honor about this issue that have concluded as I've 7 suggested here, but I think it also makes sense just to think 8 for a second about what this would entail if we're going to do 9 this and allow them to challenge assignments with respect to 10 each of these works. 11 Bear in mind, we have over 200 works in this case. 12 Almost all, if not all, these works involve many, many authors. 13 They would have, I suppose, us have a trial where for each work 14 we say, okay, identify every one of the authors. 15 dozens. 16 sign? 17 authorized by their employer to sign it? 18 years doing trials, and -- 19 20 There may be For each of those authors, what documents did they For each of those documents that they signed, were they THE COURT: We will be here for No, we won't. (Laughter) 21 MR. FEE: 22 THE COURT: 23 MR. FEE: I think you got my point. I got your point. So, unless you have any other questions, 24 Your Honor, that's all I have. 25 THE COURT: Thank you. 94 1 MR. HUDIS: Your Honor, Jonathan Hudis for the AERA 2 plaintiffs. 3 ownership we have a very, very simple case. 4 Of the 16 joint committee members of the 1999 standards, 13 of 5 them signed nunc pro tunc work made for hire agreements with the 6 sponsoring organizations. 7 Hopefully, we'll make up some time here, because on We have one work. The heirs of two deceased committee members signed 8 posthumous copyright assignments. 9 Ms. Ernesto's declaration. Those are all attached to To Register of Copyrights issued a 10 copyright registration to these standards to AERA in 1999. 11 ownership of record was corrected by a supplementary copyright 12 registration in the standards to all of the three sponsoring 13 organizations in 2014. 14 An Public.Resource has not submitted any evidence to contest 15 these facts of ownership, and in defendant's summary judgment 16 brief, Public.Resource specifically elected not to move for 17 summary judgment on this issue. 18 So we have the registration certificates as prima facie 19 evidence of validity and ownership, we have the work made for 20 hire letters, the two assignments, all of which are of record; 21 and as my colleagues from the ASTM case said, the assignee is 22 not required to have been assigned a copyright by all of the 23 co-owners to have standing to sue. 24 15. 25 Just poof. We couldn't find one of the He just could not be found. THE COURT: Mr. Hudis, I think that -- I have zero 95 1 minutes under the approximate schedule for arguments on 2 Plaintiffs AERA, but if they're not contesting your ownership -- 3 MR. HUDIS: Well, let's hear from them. 4 THE COURT: Right. 5 6 What I want to do is I'll let you get back up if hear that they are contesting your ownership. MR. HUDIS: But like the ASTM plaintiffs said, they 7 don't have standing to assert any problems with our copyright, 8 even if they wanted to. 9 10 11 THE COURT: Thank you, Your Honor. All right. Why don't we start with the standing issue. MR. BRIDGES: Thank you, Your Honor. The Supreme 12 Court in Feist said the burden is on the plaintiff to prove 13 ownership of a valid copyright and infringement of the 14 constituent parts of a valid copyright. 15 THE COURT: But isn't that in a case where there are 16 disputed copyright holders? And what of plaintiffs' argument 17 that you don't have standing to challenge their ownership of the 18 copyrights in this case because you're not alleging that you own 19 a competing copyright? 20 MR. BRIDGES: Your Honor, the point is, Feist says 21 the plaintiff has the burden of showing ownership in an 22 infringement case. 23 Court said the plaintiff has the burden of proof of ownership. 24 25 That was an infringement case. The Supreme Now, they are relying upon a statement in the Copyright Act that says a registration within five years of first publication 96 1 is prima facie evidence. 2 have standing. 3 Doesn't say that a defendant doesn't It says it's simply prima facie evidence. And by the way, speaking about AERA, AERA is now relying on 4 a 2014 registration, because it acknowledges that the 2009 5 registration was wrong. 6 So it's not relying on the 1999 registration; it's relying on 7 a 2014 registration. 8 presumption on error. 9 So the 1999 registration was wrong. It's not within the five years. No But coming back to your point, the argument that they're 10 basically making is that there's no standing to challenge 11 standing. 12 to show that it owns something. 13 facie case from the statute, but the statute doesn't say 14 somebody accused of infringement can't challenge the first Feist 15 factor. Standing is an Article III plaintiff burden. It has And, yes, it can have a prima That's a red herring. 16 There have been some cases that have said that, where I 17 think they are cases where they're saying somebody's a dirty 18 infringer; I'm going to throw the book at them. 19 be the approach. 20 doctrine or something like that. 21 made it clear that plaintiff has the burden. 22 That seems to It's almost like the fugitive disqualification It doesn't play here. Feist And in every copyright case brought by a U.S. author, 23 there must be a registration. There must be a registration. 24 Otherwise, you don't get into court. 25 registration denies a defendant the ability to defend against So the argument that a 97 1 2 the first element of Feist makes no sense, Your Honor. Now I would like to go to the substance here because, 3 frankly, yes, the ownership issues here are a dog's breakfast, 4 Your Honor. 5 They are a complete chaos, and I think it's -- THE COURT: Why isn't it enough for the plaintiffs to 6 demonstrate that they have at least one individual who will sign 7 their authorship rights to the plaintiffs in each of the works 8 at issue? 9 MR. BRIDGES: That would be enough to give them 10 standing, and we're not saying they don't have standing. 11 would like to direct the Court's attention to a case involving 12 one of the plaintiffs here, National Fire Protection Association. 13 But I It had standing in its case when it was sued for copyright 14 infringement by another code company. 15 challenged ownership, and the district court, Northern District 16 of Illinois in 2006, when the shoe was on the other foot, 17 acknowledged that when NFPA was the defendant, it made some 18 valid points about problems with the ownership. 19 It had standing, it It said summary judgment would be inappropriate on 20 ownership. It's clear that they don't own everything. There 21 needs to be a trial to sort out what they do and don't own, 22 because what they do and don't own makes a difference to what 23 the alleged infringement is. 24 read International Code Council v. National Fire Protection 25 Association, 2006 Westlaw 850879, Northern District of Illinois, So I absolutely ask the Court to 98 1 2 2006. And what's interesting is that Public.Resource is just 3 making the arguments here that National Fire Protection 4 Association made there. 5 interesting is how many different ways the plaintiffs have 6 changed their tune. 7 on these being joint works. 8 they put all their force. 9 Now it's changed its tune. But what's If you read their briefs, they are all in They're joint works. That's where Except that none of their registrations call them joint 10 works. 11 Because if a work is a joint work, all authors are to be named 12 in the registration. 13 And so the whole joint-works argument that you see now is just 14 thrown up here. 15 here because they know they've got severe problems with the 16 assignments. 17 They didn't. And it's a material omission. All authors. Why? And they didn't do that. It wasn't in the registrations. It's thrown up And I've given a copy of this to opposing counsel. I would 18 like to hand this up. This, Your Honor, is a compilation of 19 documents regarding ownership, and we have put a summary -- I'm 20 not asking the first one to be into evidence, but there's a 21 summary on page 1 that you should consider part of our argument 22 that explains the various, different types of documents. 23 THE COURT: 24 MR. BRIDGES: 25 Is this in the record? Tabs 2 through the end are in the record, Your Honor, and they all have the filing stripes. 99 1 THE COURT: Tab 1 is the summary for -- 2 MR. BRIDGES: 3 THE COURT: 4 MR. BRIDGES: Tabs 2 through 27. All right. And, Your Honor, if you look at the 5 summary in tab 1, every one of ASHRAE's supposed assignments are 6 not assignments. 7 what is in tab 2, that's the document. 8 9 10 11 They just aren't assignments. If you look at It says, "I hereby grant ASHRAE the nonexclusive royalty rights, including nonexclusive rights in copyright." And down below, it says "nonexclusive royalty rights." A grant of nonexclusive rights does not convey an 12 assignment. 13 copyright holder. 14 with any assignment language. 15 the first problem. 16 An assignment must convey exclusive rights of the There are no assignment documents from ASHRAE It's all nonexclusive. The second problem is with ASTM. So that's Bear in mind that the 17 latest ASTM standard at issue is 2007, and it admits that it 18 didn't ask for assignments until 2005. 19 well, we sort of got assignments in our membership applications. 20 But before 2008, they have no completed membership forms and 21 therefore no assignments with the exception of one that really 22 doesn't matter. 23 And then it later said, It claims, well, we had an IP policy, but an IP policy is 24 not an assignment. 25 § 204. I mean, the copyright law is quite clear in It says, a transfer of ownership is not valid unless -- 100 1 I mean, it is not valid unless an instrument of conveyance or a 2 note or memorandum of the transfer is in writing and signed by 3 the owner of the rights conveyed or such owner's duly authorized 4 agent. 5 membership forms, oh, I agree that anything I do will belong to 6 you, that's not an assignment. 7 It's a severe problem. 8 9 And the cases are clear that when you say on these So that's the ASTM problem. Then we get to NFPA, and I will admit that the most recent NFPA standard is better. Okay? It is absolutely better. 10 That's why they amended the complaint to add it to the lawsuit, 11 because it may be the only document at issue in this case where 12 there looks like pretty good ownership. 13 a problem, Your Honor, and this gets a little technical. 14 But even there, there's Now that they claim that everything is joint works from 15 joint owners, what about the fact that some of these joint 16 owners are the U.S. government? 17 participate as joint authors? 18 That U.S. government employees No case has ever dealt with this, Your Honor, and I don't 19 know how to deal with it. 20 that U.S. government works are not subject to copyright, and 21 Mr. Klaus explained that those are, where they're prepared by an 22 employee acting in the scope of employment. 23 they've got joint works with a whole bunch of federal employees 24 as joint authors. 25 But § 105 of the Copyright Act says So this is just a mess. Now they're saying Your Honor, yes. It is a dog's 101 1 breakfast. 2 case to bring. 3 chose how vulnerable a set of standards they would choose. 4 That's their problem. 5 get summary judgment on ownership. 6 It's a mess. Mr. Fee said that. They chose what They chose how complicated to make it. They I think, Your Honor, there's no way they I'm not necessarily saying that we deserve summary judgment 7 on ownership, but the problem is this is a complete mess. 8 a mess of their own creation, and it's a mess caused in part 9 because they've changed their story as to what it is. 10 these things are nonexclusive licenses. 11 It's Some of say in the registration, works made for hire. 12 Some they claim -- they Well, there's a reason for that, Your Honor, because if 13 it's a works made for hire, then people can't terminate 14 assignments after 35 years the way they can if they're not works 15 made for hire. 16 copyright registrations. 17 There's a reason for that strategic point in They claim, oh, we didn't mean anything wrong, because we 18 were told by the copyright office. 19 what somebody said, something that happened years ago with no 20 discussion about, well, what facts did they give the copyright 21 office that caused the copyright office to say to do this? 22 Your Honor, somebody reported The problem is the whole thing is a mess. What we do know 23 is that NFPA has been entirely hypocritical. We know that 24 everybody has abandoned the very basis of ownership they claimed 25 in their registrations that they don't want us to challenge. 102 1 It's just -- it's got to be done thoroughly. 2 Unfortunately, ownership is on a work-by-work basis, and I 3 notice that they brought this motion on only -- I think it's 4 nine out of over 250 standards at issue. 5 that. 6 they've got a problem. 7 There's a reason for They've cherry-picked their best cases, and even then And then one thing about joint authorship, they say, well, 8 our staff were joint authors because we sort of helped add a 9 footnote or we helped perfect some language or whatever. It's 10 clear that in a law review -- I don't want to say law review, 11 because it's got its own structure, but if I submit an article 12 to a law review and I own the copyright and the article, the 13 editor at the law review who edits my law review article doesn't 14 become my joint author. 15 Having some editing function isn't an authorial function. 16 And in many of these, the staff were forbidden from being 17 members of the technical committees that actually did the 18 writing, technical committees that had academics, government 19 officials and the like. 20 Second Circuit makes it clear that an editor is not an author. And Childress v. Taylor out of the 21 I know we're running long, so I won't go any further. 22 I would just say, Your Honor, there is no way that they've 23 established ownership to the level that is necessary to get 24 summary judgment for them on this. 25 And I will say this. Now that they claim that it's joint 103 1 works, the Copyright Act -- and remember, they claim they've got 2 joint works, but they have not identified in any registration 3 all the authors. 4 the Copyright Act, it provides for the Court to consider 5 bringing in the other owners. 6 owners here know about this case, and if any one joint owner 7 decides they like Public.Resource, that joint owner has full 8 authority to grant Public.Resource a complete license. 9 It is important and it is material, because in I'm not sure the other joint So they're saying, oh, we're joint owners with thousands 10 of people. 11 24,000 people. 12 standards here. 13 to look to make sure the joint owners are protected, because if 14 they are joint owners, they have a fiduciary duty to account 15 their profits to the other joint owners, which is just another 16 reason why it's such a specious argument. 17 I think ASTM, across all its standards, says it has That's for thousands of standards, not just the But the point is, the Court has a responsibility And why are they making a specious argument? Because what 18 they said in the registration isn't right, and what they tried 19 to do with the assignments couldn't turn the corner. 20 was their third fallback, and it's intellectually dishonest, 21 Your Honor, and should not be countenanced. 22 THE COURT: 23 MR. FEE: 24 25 So that Thank you. Thank you. May I have one or two minutes, Your Honor? There was a lot in there. THE COURT: I'd prefer one, but I'll give you two. 104 1 MR. FEE: First of all, let's just cut to the chase 2 with respect to the notion that it was somehow a material 3 mistake not to list all the individual and joint authors. 4 We cited a case, the Original Appalachian Artworks case, for the 5 proposition that that's not a material mistake. 6 said nothing in their briefs. 7 today. 8 9 The other side We've heard nothing about it The other notion that I want to correct for Your Honor is this notion that we are only claiming joint authorship. 10 As we point out in the briefs, and as even the court in Veeck 11 identified, organizations like this who are creating standards 12 are the organizational authors of these works, but because they 13 have literally no evidence to rebut the evidence we put in about 14 what particular authors wrote while they were in our employment, 15 that's the simplest way for you to dispel of this non-ownership 16 issue. 17 we have joint ownership at a minimum, and we also have 18 assignments from the relevant persons. 19 But we believe that we were the organizational authors, Again, we didn't see any evidence about assignments that 20 were tied to any of the works in these issues. 21 this book -- you know, I looked at whatever he pointed you to. 22 You couldn't tell if that person ever made any contribution. 23 I don't think That's also, I think, important with respect to the 24 government point he's trying to inject here at the last minute. 25 He's sort of hypothesizing about what contributions, if ever, 105 1 were made by federal government employees in the course of their 2 employment. 3 that that somehow affects the copyright interest here. 4 no support for any of that in either the case law or in the 5 record. 6 Then he's hypothesizing about a potential argument There's I do want to turn just for one second to this ICC case, as 7 well, that he likes to make a big deal about. The ICC case, 8 first of all, there's two points that I think are important. 9 One is the assignment issues in the ICC case were a little 10 different than the ones that we have here in that there is also 11 a provision that was not raised in the ICC case that is raised 12 in this case as a basis for assignment. 13 And similar language is also available to ASHRAE. If you 14 look at the ASHRAE assignment that Mr. Bridges read to you -- 15 I think it was Exhibit 2. 16 document to you. 17 it, at sort of the end of that, it says, "I understand that I 18 acquire no rights in publication of this standard in which my 19 proposal in this or other similar analogous form is used." 20 So he read one portion of that But in the section that has the No. 2 next to So there's a clear disavowal of any ownership right in 21 these forms that was also present in the NFPA forms as well. 22 That, combined with the fact that the NFPA has been claiming 23 ownership for these works for over a century without any 24 objection I think is more than adequate to show that there's an 25 intent to assign, and this document suffices to meet the statute 106 1 of frauds requirement for the Copyright Act, assuming you even 2 believe that they could raise that issue. 3 Did Your Honor have anything else? 4 5 THE COURT: No. Thank you. And I'll just say now that, given where we are with time, 6 I'm not going to hear argument on the motion to strike the 7 experts. 8 there's something absolutely -- and I apologize if somebody 9 spent a lot of time preparing to argue that; but given where we I can rule on the papers on those unless you think 10 are, I feel like the briefs have covered that, and I can rule on 11 the papers on that one. 12 13 14 Mr. Hudis, did you have something that your learned co-counsel didn't cover? MR. HUDIS: Only what Mr. Bridges just brought up. 15 I'll take a minute. 16 absolutely relying on that. 17 from '99 to 2014 was to add the two other co-owners. 18 correction of ownership. 19 case out of the Seventh Circuit, and it says they have no 20 standing to challenge any of this. 21 of a mistake. 22 Mr. Bridges says otherwise is just not true. 23 The '99 registration, yes. We are The only thing that was changed A mere We have cited the Billy-Bob v. Novelty This was a mere correction It is not a material mistake, and anything that Merely providing comments, by the way, this is something 24 that Mr. Bridges just said that was very surprising to me. 25 Merely providing comments is not authorship. Well, then, we 107 1 have ownership and validity and authorship all wrapped up in a 2 very nice, neat bow. 3 from Mr. Bridges just now about the ownership of our copyright. 4 Thank you, Your Honor. 5 6 7 THE COURT: There's no challenge on anything I heard Thank you, Mr. Hudis. So on the trademark issue from ASTM? MR. FEE: Kevin Fee again, Your Honor. Just one more 8 point, if you don't mind, on the copyright that Mr. Hudis just 9 reminded me of. The evidence with respect to copyright 10 ownership is not that there were just editorial changes made by 11 the parties. 12 we've identified entire paragraphs that were written by ASTM 13 employees in the course of their employment. 14 we were adding a footnote or changing a comma here and there is 15 just not consistent with the evidence. 16 We have declarations with respect to ASTM where Now moving on to the trademark issues. So the notion that Public.Resource, 17 like its ownership story, has done its best to try to complicate 18 this trademark case, which I think is really actually a 19 relatively straightforward trademark case. 20 Public.Resource has used exact copies of plaintiffs' marks 21 on what it claims to be exact replicas of plaintiffs' standards, 22 and it intends the public to believe that the materials that it 23 posted on its website are authentic versions of the standards 24 offered by the plaintiffs, when they simply are not. 25 The fact of the matter is that the plaintiffs in this case 108 1 have absolutely nothing to do with the electronic files that 2 Public.Resource posted on their website. 3 seen those files before they were posted on the Internet, and 4 plaintiffs exercised no quality control over the files that the 5 defendant posted on the Internet. 6 authorize Public.Resource to put those files -- sure. 7 Plaintiffs had never And it certainly did not The bottom line is, Public.Resource placed plaintiffs' 8 trademarks and logos on knockoff publications that are of an 9 inferior quality to the publications of the plaintiffs, and 10 that is a clear-cut trademark infringement case for which 11 summary judgment is warranted. 12 Now, there is no argument here about whether or not 13 plaintiffs own protectable trademarks. And when an identical 14 trademark is used in connection with identical or very similar 15 products, it is not necessary for Your Honor to even walk 16 through all the likelihood of confusion factors, and we cited 17 numerous cases for that proposition in our briefs. 18 And not surprisingly, Public.Resource doesn't cite a single 19 case where a plaintiff failed to meet its burden with respect to 20 trademark infringement when there is evidence of the exact same 21 mark being used in connection with very similar services when 22 there is an intent to have consumers believe that the source or 23 origin of the defendant's product was the plaintiff. 24 25 THE COURT: Let me ask you. You argue that the defendant's double-keying method is not as effective as the 109 1 triple-keying method for guarding against inaccuracies, but as 2 I understand the doctrine, I should be able to look at evidence 3 of your quality control standards to determine that defendant 4 hasn't met them. 5 6 Did you put in any evidence of your own quality control standards, and if so, where is it in the record? 7 MR. FEE: I believe that if you look in the ASTM one 8 I'm most familiar with, Mr. Tom O'Brien's declaration, there is 9 a description of those quality control methods. 10 THE COURT: 11 MR. FEE: All right. But I would point out that I think 12 the bottom line is that that doesn't really matter in this 13 circumstance except with respect to harm, which you may hear 14 about later. 15 THE COURT: 16 MR. FEE: Right. But whether or not -- you know, they could 17 have done a perfect job complying with our quality control 18 standards. 19 trademarks and put it on something we have nothing to do with. 20 They still don't have the right to steal our Because there's no real good argument for the assertion 21 that you could use the exact same mark on virtually identical 22 products without avoiding infringement, the primary argument 23 that we hear from Public.Resource is that you can't bring a 24 trademark case in this circumstance, and that argument is based 25 entirely on the Supreme Court's decision in Dastar. 110 1 But the very first sentence of the Dastar opinion starts 2 with Justice Scalia saying that the issue before it was "whether 3 § 43(a) of the Lanham Act prevents the unaccredited copying of a 4 work." 5 That is not the issue in this case. In fact, it's the 6 exact opposite. This is not an unaccredited copying of a work. 7 It is placing a party's trademark on a work that the plaintiff 8 had no involvement in the product that bears its trademark. 9 But the Supreme Court in that case decided that it must assess 10 whether or not § 43(a)(1)(A) of the Lanham Act's use of the term 11 "origin of goods" covered just the person who made the physical 12 good or whether it was the person who created the expression. 13 The Court in that case held that "origin of goods," as that 14 term is used in § 43(a), covers just the physical good at issue 15 and not the person who created the expression that might be 16 embodied in that good, and it reached that conclusion because 17 it wanted to avoid the possibility of there being a perpetual 18 copyright for the expression after the copyright had expired or 19 otherwise gone away. 20 So the Court noted that "The rights of a patentee or a 21 copyright holder are part of a carefully crafted bargain under 22 which, once the copyright monopoly has expired, the public may 23 use the invention or work at will but" -- and this is 24 important -- "without attribution." 25 here. That is not what happened 111 1 On the other hand, the Supreme Court noted, "A party could 2 face Lanham Act liability for crediting the creator if that 3 should be regarded as implying the creator's sponsorship or 4 approval of the copy." 5 6 7 And that's exactly what's happened here. So Dastar actually confirms that a trademark infringement case is possible in this circumstance, not the opposite. But you don't have to take my interpretation of Dastar. 8 We've cited many cases that confirm this is how Dastar's 9 properly interpreted. In the Bock case, the Court held that 10 Dastar stood for the proposition "that the origin of goods 11 provision in 43(a) of the Lanham Act does not contain a cause of 12 action for plagiarism." 13 about the unattributed copying of our text, then Dastar would 14 bar that claim, assuming we didn't have a copyright infringement 15 claim. That's true. If we were complaining 16 On the other hand, the Slep-Tone case that we cited 17 indicated that Dastar suggested that "there would have been a 18 Lanham Act violation where, for example, Dastar had simply 19 copied the television series and sold it as Crusade in Europe 20 without changing the title or packaging, including the original 21 credits to Fox. 22 So just like in our case where they don't change the 23 original crediting to the plaintiffs, the Slep-Tone case 24 concluded that a trademark case could be brought in conjunction 25 with a copyright infringement case in that circumstance. 112 1 Public.Resource really only cites one other case in support 2 of its argument; but that case also involved an attempt to 3 convert a plagiarism case into a trademark infringement claim, 4 and that was the Prunte v. Universal Music Group case. 5 Public.Resource also has tried to defend its conduct under 6 the first sale doctrine, but the first sale doctrine applies 7 only to goods that are being sold when those goods are the 8 genuine product of the plaintiff that are being resold to 9 consumers. The electronic files that are being sold by the 10 defendant in this case were posted, are not the authorized 11 documents that were created by the plaintiffs, and therefore 12 are not subject to the first sale doctrine. 13 Public.Resource had purchased hard-copy materials from 14 the plaintiffs, and if they had wanted to repackage those or 15 do something with the hard copy that they had, that would be 16 covered by the first sale doctrine. 17 done here. 18 But that's not what they've Instead, they've created new documents or electronic files 19 of what they purchased from the plaintiffs and tried to defend 20 that under the first sale doctrine, but the bottom line is that 21 those electronic files were never purchased from the plaintiffs 22 in this case. 23 lesser quality than the plaintiffs' works. 24 25 Making things worse, of course, they're of a Defendants also try to defend their use of the plaintiffs' trademarks by claiming nominative fair use, but there's three 113 1 requirements that prove nominative fair use. 2 use of the plaintiffs' mark is necessary to describe the 3 plaintiff's product. 4 need to refer to ASTM if what they're really trying to publish 5 is the law. 6 without reference to ASTM or the other plaintiffs, and that's 7 exactly what happened in the Veeck case. 8 Circuit noted that Veeck had just identified the building codes 9 as the law as to relevant towns and not as the model codes 10 One is that the But there's no reason that the plaintiffs They could just publish what they call "the law" In Veeck, the Fifth themselves, which is what is being done here. 11 The second requirement for non-fair use is that the 12 defendant only use as much of the plaintiffs' trademark as is 13 necessary. 14 use any of our marks, but it certainly is not necessary for them 15 to use the logos of our clients. 16 It's not necessary, as I just explained, for them to There's a long line of cases that we've identified in our 17 brief that stand for the proposition that it's very unusual, if 18 not almost never the case, that you have to actually use a logo 19 as part of a nominative fair use. 20 at all, they could just call it ASTM Standard D975. 21 need our circle and our symbol there. 22 otherwise. 23 If they had to use our name They don't There's no way to argue It's even pointed out and made more clear by the fact that 24 Public.Resource, after the fact now, has started to post some 25 standards not at issue in this case, but other standards of 114 1 plaintiffs where they don't put the logo on there. 2 obviously don't need to have the logo there. 3 So they The third requirement for nominative fair use is that the 4 defendant not do anything that suggests sponsorship or 5 endorsement by the plaintiffs of the works that are being 6 provided by the defendant. 7 is clear, did everything in its power to try to make the 8 standards that he was posting or that Public.Resource was posting 9 on the website to look exactly like our standards. But Public.Resource, the testimony So there's 10 no basis for the notion that they did anything to avoid a 11 likelihood of confusion in their supposed nominative fair use. 12 The last point I want to touch on real quickly is the 13 notion that some disclaimer is present and that somehow that 14 will eliminate the likelihood of confusion. 15 First of all, it bears noting that the defendant has the 16 burden of proof with respect to showing that a disclaimer will 17 eliminate the likelihood of confusion. 18 793 F.3d 571, from the Sixth Circuit so holds, as does Weight 19 Watchers v. Luigino's, 423 F.3d 137. 20 The CFE Racing case, Public.Resource presented literally no evidence that any 21 disclaimer would be effective in this case. 22 of the matter is, with respect to the standards at issue in this 23 case, there are no disclaimers at all. 24 25 In fact, the truth You saw the sort of cover sheet you were referring to earlier with the red, white, and blue stripes on there which I 115 1 think Public.Resource likes to suggest is a disclaimer of some 2 sort, but that disclaimer says nothing about not being affiliated 3 with the plaintiffs in this case or that Public.Resource has 4 authored these materials in any way. 5 Public.Resource submitted some evidence of a disclaimer, but it 6 has nothing to do with any of the works in connection with this 7 matter. 8 this case. 9 After the fact, In any event, a proper disclaimer is not sufficient in As the court in the International Kennel Club case in 10 the Seventh Circuit recognized, quote, "especially where 11 infringement in the case is verbatim copying of plaintiff's 12 name, we are convinced that plaintiff's representation and 13 goodwill should not be rendered forever dependent on the 14 effectiveness of fine-print disclaimers often ignored by 15 consumers." 16 The thing that's most prominent and that tells the 17 consumers in the first instance who is the source of these 18 materials are the logos of the plaintiffs in this case. 19 That's what parties are going to look at when they're trying to 20 figure out who was responsible for these files. If you have some 21 sort of disclaimer on it, it's going to be ignored. 22 courts frequently don't find disclaimers to be sufficient to 23 avoid confusion. 24 25 That's why Unless Your Honor has any other questions, that's all I have. 116 1 THE COURT: 2 MR. BRIDGES: 3 Thank you. Thank you, Your Honor. This is Andrew Bridges again for Public.Resource. 4 THE COURT: Mr. Bridges, if the defendant's sole 5 purpose is to disseminate the law, as you say, why do you need 6 to disseminate the plaintiffs' logos? 7 MR. BRIDGES: We don't have to, Your Honor, except 8 that what we've done is, in the spirit of what we understand the 9 incorporation is to be, which is incorporation of particular 10 documents, Public.Resource has replicated the entire document. 11 As is. Now, we need -- 12 THE COURT: Well, then you add this certificate; right? 13 MR. BRIDGES: That's right, which emphatically 14 makes the point that it is the law. 15 Public.Resource's. 16 Public.Resource is trying to confuse the public about source 17 sponsorship or affiliation of these standards is pretextual and 18 ironic. 19 what. 20 reverse passing-off, but because it maintained the logos, 21 they're suing for trademark infringement. 22 It doesn't say this is We need to be clear. The allegations that The fact is, they would sue Public.Resource no matter If Public.Resource dropped the logos, they would sue for Let me be clear. Public.Resource would take direction from 23 this Court. Logos: yes or no? It doesn't care. It simply 24 tried to replicate the law which consists of these documents 25 incorporated by reference. 117 1 Disclaimer. First of all, the Supreme Court in two cases 2 has approved disclaimers. 3 first of all, I'm not sure that the plaintiffs would want their 4 logos taken off because they use their monopoly position to try 5 to make money by associating these standards that have become 6 law with themselves. 7 get the logos off, Your Honor. 8 We're just trying to make clear that these are the laws that are 9 in the CFR or state law or whatever. 10 11 If Public.Resource needs to say -- But if they want the logos off, we will That's not a sticking point. If the Court wants a disclaimer -THE COURT: Well, with regard to disclaimer, if you 12 point to your disclaimers as sufficient to notify consumers that 13 the standards aren't originals, that they're reproductions, I 14 look at the language on the cover page, and it's hard to 15 understand how this -- is this Exhibit 16? -- how this resolves 16 any confusion. 17 MR. BRIDGES: Your Honor, it's not just about this. 18 It's about the entire experience that somebody has going to 19 Public.Resource's website. 20 don't think I'm going to the Library of Congress to get a law. 21 I know I'm going someplace where I can get the law. 22 confusion between the National Archives and Cornell, but I know 23 that I can go to Cornell to get the law. 24 of confusion that somebody thinks Public.Resource wrote these. 25 THE COURT: When I go to the Cornell website, I I've got no There is no likelihood Then why do you have a disclaimer? 118 1 MR. BRIDGES: We have this document that says this is 2 the law. We have -- and I'm not -- there are different 3 disclaimers at different times, so I'm not clear on exactly what 4 they've all been. 5 THE COURT: Why do you even need this? 6 MR. BRIDGES: We need this to make a political point 7 that this is the law, and we want people to understand that this 8 is no longer just somebody's private standard. 9 and that's exactly what it says here. 10 11 12 13 This is the law, It's giving the citation to the U.S. Code that makes it the law. THE COURT: If all you want to do is to make sure that consumers realize that it is the law, why do you need their logo? MR. BRIDGES: I'm saying, Your Honor, we would drop 14 the logo in a second if that's the Court's direction. The 15 reason we included the logo -- we don't have to have a fight 16 over them with this. 17 THE COURT: 18 MR. BRIDGES: Well, they brought a claim. That's right. They brought a claim, and 19 they would have brought a claim no matter what we did, because 20 it's really a copyright issue. 21 THE COURT: The Court is unconcerned with their 22 motivations for bringing a claim. 23 they have a valid claim. 24 25 MR. BRIDGES: My only concern is whether Your Honor, if the motivation is to enforce a copyright right, then it's squarely in the middle of 119 1 Dastar, and that's a problem. 2 relevant. 3 Copyright Act, then it's a Dastar problem. 4 That's why the motivation is If it is to get around a limitation imposed by the But let me make it clear. We're trying -- we don't -- what 5 we want is to continue to make the law available. 6 matter if it is with a logo or without a logo. 7 make the law available. 8 dropping the logo as well as for including the logo because they 9 don't want the standards out there. 10 11 issue. It doesn't We just want to But they would have sued us for And that's the copyright This is really a copyright case. So if the Court says drop the logos, they would be dropped. 12 If the Court says add a disclaimer that says you have scanned 13 and reformatted these, we would add that disclaimer. 14 want to say Public.Resource had no involvement in the creation 15 of these standards, that's fine. 16 to create any confusion. 17 If you Public.Resource has no desire As a matter of fact, Public.Resource tries to be very clear 18 about what these are. If anything, the plaintiffs want everybody 19 to think you have to buy the law from them, and that's the 20 problem in this case because they're saying they've got an 21 exclusive right to the law and they have the right to control 22 who accesses the law, who makes a derivative work of the law and 23 so forth. 24 So this trademark issue need not be an issue, because 25 Public.Resource isn't trying to make a point about itself other 120 1 than to be clear about what it's doing. 2 fight the trademark fight, but we don't need to fight a 3 trademark fight, Your Honor. 4 THE COURT: 5 MR. BRIDGES: 6 THE COURT: 7 All right. So there is -- we can Thank you, Mr. Bridges. Thank you. Any discussion of remedies? Good afternoon now. 8 MR. CUNNINGHAM: 9 Blake Cunningham of King & Spalding. 10 ASHRAE. 11 this topic. 12 Good afternoon, Your Honor. I represent Plaintiff very brief. 13 I'll be speaking on behalf of the ASTM plaintiffs on I'm mindful of the time, so I'll try to keep this Now, Your Honor, the Supreme Court counseled, in the 14 eBay v. MercExchange case, that there are four essential factors 15 that should be considered when a court is deciding whether to 16 exercise its discretion to issue a permanent injunction. 17 The first of these factors is whether or not irreparable 18 injury will occur in the absence of an injunction. Now, here 19 it's not disputed that plaintiffs' standards have been accessed 20 thousands of times on defendant's website. 21 disputed that defendant placed plaintiffs' standards on the 22 Internet Archive website and that they were downloaded thousands 23 of times from that site. It's also not 24 That these downloads and accesses would represent some 25 impact on the legitimate market for these works is, as Your 121 1 Honor noted earlier today, somewhat a matter of common sense. 2 But in this case, we've also backed it up with the expert 3 opinion of Mr. Jarosz, which of course went unrebutted. 4 THE COURT: Let me ask you -- and I don't mean to jump 5 around, but while I have you up here. 6 judgment as to six standards. 7 seeking a permanent injunction just as to those six? 8 9 MR. CUNNINGHAM: You've moved to summary At this time, are you still So we are seeking a permanent injunction -- I think it was nine standards, Your Honor, that we 10 moved on. 11 nine standards. 12 infringement. 13 courts have enjoined future infringement of separate works, and 14 here we think that's especially on topic because Public.Resource 15 -- I think even earlier today Mr. Bridges stated that they plan 16 to keep posting more and more works, and it would not be 17 efficient for any of us if we have to keep coming back and 18 reliving this same case. 19 So we're seeking a permanent injunction for those We're also asking that the Court enjoin future We've cited a number of cases in our briefs where THE COURT: You seek to cure the copyright 20 infringement broad enough to cure any trademark infringement, 21 as well as -- from what I hear, everybody's willing to be 22 reasonable on this, but -- 23 MR. CUNNINGHAM: Yeah. I think an injunction on the 24 copyright infringement would tend to also encompass the 25 trademark issues. 122 1 2 3 THE COURT: And what's your intention regarding your remaining contributory copyright infringement claim? MR. CUNNINGHAM: If we got an injunctive relief that 4 involves taking the standards off the website, I don't think we 5 would intend to keep pressing for any sort of damages or 6 anything on a contributory theory. 7 THE COURT: 8 MR. CUNNINGHAM: 9 All right. So, Your Honor, the kind of question becomes, when looking at the harm here, whether the harm is 10 itself irreparable. Now, courts have looked at this question of 11 what makes harm reparable or irreparable, and the Second Circuit 12 in the Salinger v. Colting case took up this question and said 13 the following: 14 "Harm might be irremediable or irreparable, for many 15 reasons, including that a loss is difficult to replace or 16 difficult to measure, or that it is a loss that one should not 17 be expected to suffer." 18 Now, in this case, I feel like there are at least three 19 reasons why the harm that's suffered would be very difficult to 20 measure and difficult to compensate with monetary damages. 21 The first is, as our expert Mr. Jarosz went into detail on, 22 one of the likely outcomes of this case is that plaintiffs would 23 have to change their business models. 24 from selling standards, we may have to switch, for instance, to 25 a business model where we charge people to participate in the If we lose the revenue 123 1 standards creation process. 2 Now, our clients feel like that would result in less 3 preferable standards that don't reflect the broad interest that 4 we currently try to reflect in our standards creation. 5 also be the result that we would produce less standards, fewer 6 standards. 7 one that's particularly hard to quantify. 8 9 They may Again, that's a negative outcome for us, but it's A second reason why damages might be hard to quantify here is that the works are shared without restriction online by the 10 defendant. 11 plaintiffs of their copyrights. 12 printed, and even redistributed by anyone. 13 notably does not have information on how the works are used 14 after they're downloaded, which means that we can't even know 15 the full extent of the infringement here. 16 This leads to an outright loss of control by The works can be downloaded, And Public.Resource Now, this is very much analogous to the 2007 Grokster 17 case which we discuss in the briefing. 18 defendant was being sued for marketing a peer-to-peer 19 file-sharing network that facilitated widespread sharing of 20 files, and the Court found irreparable harm because the nature 21 of the defendant's conduct and the redistributable nature of the 22 works rendered the works "particularly vulnerable to continuing 23 infringement on an enormous scale." 24 25 In that case, the The Court went on there to say, "When digital works are distributed via the Internet, every downloader who receives 124 1 one of the copyrighted works is, in turn, capable of also 2 transmitting perfect copies of the works. 3 process is potentially exponential rather than linear, 4 threatening virtually unstoppable infringement of the copyright." 5 Accordingly, the And we feel like we're in the same situation here. 6 Defendant has shared our works without restriction, we have no 7 view into how they're being used down the line, and there's 8 virtually unlimited infringement happening. 9 outright loss of control of our copyrighted works. So it represents an 10 The third thing I wanted to get into in terms of why harm 11 would be incredibly difficult to quantify here is that there's 12 reputational harm. 13 clients, the plaintiffs, have spent decades, if not over a 14 century, building their reputations by producing quality 15 standards. 16 errors, include substantive errors, then that could be 17 potentially damaging to the reputation of our clients. 18 It's not disputed, I think, that our And if these are recreated in ways that include And as Mr. Fee explained in his argument, this is not 19 necessarily a purely theoretical argument. We do believe that 20 Public.Resource's quality control mechanisms have been quite lax 21 and have resulted in some substantive errors. 22 provide as an example, in Mr. Pauley's declaration, Mr. Pauley 23 from NFPA described how Public.Resource's OCR process had changed 24 the letter M, which stands for meters, into two letters, I and 25 N, which of course could be an abbreviation for inches. One that I'll 125 1 So it's not hard to see that these errors could lead to 2 real substantive changes in the works, and we feel like our 3 clients should not be forced to suffer the kind of reputational 4 damages that come along with these type of errors. 5 the law is pretty clear on this. 6 this circuit, the Breaking the Chain case and the Hanley-Wood 7 case that said that where there's a continued threat of 8 infringement that could harm the reputational interest, that 9 that in fact does justify an injunction. 10 And in fact, We cited two recent cases from Now, defendant, for its part, they can't come up here and 11 tell you that absolutely there is no harm that exists. Instead, 12 they're going to try to shift the dialogue here to say that 13 there's not very much harm or enough harm. 14 trying to import a fifth factor into the eBay test and say that 15 there must be a severe harm. 16 here, Your Honor. 17 irreparable, and the bar is much lower than defendants would 18 suggest. They're essentially But that's not really the standard The standard is whether the harm at issue is I'll refer again to the Grokster case. 19 In that case, the court stated, "Irreparable harm may not 20 be presumed, but in run-of-the-mill copyright litigation, such 21 proof should not be difficult to establish." 22 went on to explain that loss of market share and reputational 23 harm were prime examples of how that could be established. And then the court 24 Similarly, the Second Circuit in Salinger v. Colting 25 speculated that, even after eBay, as an empirical matter, most 126 1 copyright cases would likely involve some form of irreparable 2 harm. 3 tendency to issue preliminary injunctions readily in copyright 4 cases may reflect just that." 5 high as the defendant suggests when it comes to irreparable 6 harm. And then the court went on to say, "The historical Put simply, the burden is not so 7 The second one of the factors which I'd like to discuss 8 quickly is whether or not there are other remedies available 9 that would be sufficient here. As I've already explained, it 10 would be very hard to quantify what damages would be in this 11 situation, but even if you could do so, I think it's not 12 necessarily contested that defendant has no willingness or 13 ability to pay damages here. 14 In fact, if you look at the briefing, the defendants were 15 silent on this one of the four eBay factors. They essentially 16 conceded it, and there's a reason for that. We've got 257 works 17 at issue in just the ASTM case. 18 copyright scenario can be up to $150,000 per work for the kind 19 of willful infringement that we've got here. 20 at tens of millions of dollars in potential damages and a 21 defendant who has very, very limited resources and no ability to 22 pay that. 23 here, and that's why we've chosen to bring this case and ask for 24 an injunction. 25 Statutory damages in the So you're looking So there are no monetary damages really available Now, one other thing I'd like to say on that is, because 127 1 the monetary relief here is really inadequate, if the Court 2 finds for us on the merits, the only prudent thing to do would 3 be to issue an injunction. 4 it's kind of winner takes nothing, where we don't get an 5 injunction or damages, and the damages here aren't available. 6 We can't be in a situation where So if Your Honor did find for us on the merits but didn't 7 find that injunction was warranted, I guess our only option 8 would be to, next time Mr. Malamud posts a standard, actually to 9 sue him again and this time to ask for damages. I don't think 10 that that would be an efficient outcome for the defendants or 11 the plaintiffs or the court. 12 The third factor, Your Honor, to consider under eBay is a 13 balance of the hardships. This is a particularly easy factor 14 here because we have deposition testimony from Mr. Malamud where 15 he essentially admits that there would be no harm to 16 Public.Resource. Mr. Malamud was asked at his deposition: 17 "If Public.Resource was unable to continue to post the 18 standards incorporated by reference on its website, what impact, 19 if any, would that have on Public.Resource's financial ability 20 to survive long-term?" 21 He stated, "Probably none." 22 Mr. Malamud was also asked if he could identify any way in 23 which Public.Resource would be harmed. The only thing he could 24 think of was that there might be potential wasted effort in 25 posting these standards online. But, of course, this wasted 128 1 effort is legally irrelevant since an infringer cannot claim an 2 equitable interest in its infringing conduct. 3 the Court to the Fox television case for that proposition. 4 I would direct Now, the final of the four factors that I'd like to talk 5 about is the public interest. 6 some degree in the earlier arguments today, so I won't go into 7 the details other than to say that there is a public interest in 8 promoting the creation of creative works. 9 This has already been covered to In this instance, we feel that's especially important since 10 the works here serve the public good. 11 admitted that these are important works. 12 NFPA's works, quote, "save lives." 13 of Mr. Jarosz and in amicus briefs where we've seen that if an 14 injunction doesn't issue here, there's a real fear that the 15 quantity and quality of these works will be diminished. 16 Even Mr. Malamud has He's stated that And we've got the opinions Now, we have to balance that against the public interest 17 that Public.Resource claims that it serves, which is increased 18 access. 19 there is really no access issue here. 20 the lone complaining voice when it comes to access to these 21 standards. 22 use these standards has not been afforded access, and we already 23 provide access in our reading rooms. 24 25 But I think as we've heard a lot about earlier today, Mr. Malamud is kind of There's no evidence that anyone who really needed to So when you balance these two things, I think it's pretty clear that this factor, as well as the other three factors that 129 1 we've discussed, weighs in favor of granting an injunction. 2 Thank you, Your Honor. 3 THE COURT: Thank you. 4 MR. HUDIS: Good afternoon, Your Honor. 5 Hudis for the AERA plaintiffs. 6 Jonathan This is on the right to relief. As Mr. Cunningham cited the eBay four factors for 7 entitlement to a permanent injunction, I won't reiterate them 8 for the Court now but just to go through the factors as unique 9 to our plaintiffs in the 14-857 case. 10 As the sponsoring organizations have established the threat 11 of Public.Recource's continuing infringement, they're entitled 12 to an injunction. 13 DDC 2015. 14 publicly post standards incorporated by reference into federal 15 and state law. 16 copy of the sponsoring organization's standards on its server, 17 as does the Internet Archive. 18 That's the Green v. Brown case in this Court, Public.Resource's stated goal and mission is to Public.Resource still has an unauthorized It would be very simple for Public.Resource to repost the 19 1999 standards to Public.Resource's website and to the Internet 20 Archive with little effort. 21 will strongly consider posting the 2014 standards to the 22 Internet if they are incorporated by reference to law, and that 23 was repeated by Mr. Bridges here today. 24 25 Mr. Malamud further admits that he Thus, absent the issuance of a permanent injunction, Public.Resource will continue to disseminate plaintiffs' 130 1 standards without authorization. 2 To the factor of irreparable harm, the Court should 3 properly look to the future threat of injury to the sponsoring 4 organizations. 5 further viral infringement, and we cited, among many cases in 6 our briefing, the Walt Disney and Hanley-Wood cases in this 7 circuit. 8 9 Number one is plaintiff's inability to prevent The damage has already been done with respect to the '99 standards that were published for the two years online. The 10 2014 standards were announced in 2011, at which point there was 11 a 27 percent drop in the sales of the 1999 standards. 12 2012, the year that Public.Resources posted the infringing 13 copies of the 1999 standards to the Internet, there was a 14 further 34 percent drop in sales, and then the sales stayed 15 suppressed in 2013. 16 Then in The 1999 standards are used in many graduate courses. 17 The sales to students should have remained constant year after 18 year until the release of the 2014 standards in August of 2014, 19 and that was testified to by Professor Geisinger, both in his 20 declaration and in his deposition. 21 So again, same with the ASTM plaintiffs. The sponsoring 22 organization's inability to measure sales losses due to 23 Public.Resource's acts of infringement and contributory 24 infringement, the funds which otherwise would be used for saving 25 up to underwrite the cost of developing future updated standards 131 1 2 would be in jeopardy. There would also be two -- excuse me -- three adverse 3 effects on the quantity and quality of the effort the joint 4 committee selected by the sponsoring organizations put in to 5 creating and updating the standards. 6 freely distributed on the Internet immediately upon publication 7 and incorporation by reference -- If their work can be 8 THE COURT: Slow down a little bit, Mr. Hudis. 9 MR. HUDIS: Slowing down -- potential future joint 10 committee members and the sponsoring organizations themselves 11 will lose incentives to update this work. 12 Finally, as to irreparable harm, would be the inability to 13 inform the public that the 1999 standards are no longer the 14 latest version, and the public should purchase the 2014 version 15 instead. 16 the sponsoring organizations' collective reputations. 17 This harm to the public would be highly damaging to The balance of hardships. In contrast to the significant 18 harms to the sponsoring organizations if a permanent injunction 19 is not granted, Public.Resource has no cognizable interest in 20 continuing to infringe our standards and our copyright. 21 As an infringer, Public.Resource cannot complain about its 22 loss of copyright to offering an infringing substitute online, 23 and that's the WPIX case we cite in our briefs. 24 will suffer no recognizable harm if a permanent injunction is 25 entered. It therefore 132 1 Finally, the public interest, Your Honor. Here the public 2 interest favors entry of an injunction to stop further copyright 3 infringement. 4 store of knowledge available to the public. 5 accomplishes this by providing a financial incentive to 6 contribute to the store of knowledge. 7 The object of copyright law is to promote the The Copyright Act Allowing Public.Resource and others to freely copy the 8 sponsoring organization's standards will detract from the 9 important store of knowledge, recommended best practices for 10 testing, design, and administration available to the public. 11 If plaintiffs do not have continuing incentives to secure 12 copyright protection, those incentives to have updated standards 13 in the future will be lost. 14 Unless Your Honor has any questions, those are my remarks. 15 THE COURT: Thank you. 16 MR. HUDIS: Thank you, Your Honor. 17 MR. BRIDGES: Your Honor, while I think we agree that 18 eBay has stated the facts, one thing eBay also said was success 19 on the merits alone does not justify an injunction. 20 that much is clear. 21 three factors and focus a bit on the fourth factor. 22 So I think I want to move quickly through the first The question as to whether plaintiff has suffered 23 irreparable injury. So ASTM's president conceded, in an 24 internal document, "To date, all of Public.Resource's postings 25 have not had a measurable effect on our finances." 133 1 So they have relied upon two experts. I'll let the motions 2 to strike speak for themselves, but they are extremely weak, and 3 that's trying to be very charitable. 4 evidence. 5 them. 6 witnesses should have been saying on their own and 7 cross-examined on, and their methodologies were appalling. 8 that's what they needed to show actual harm. 9 They are not competent There are no qualifications that are appropriate for It's just serving as mouthpieces for things that And I want to go back to this point in Mr. Geisinger's report. 10 He completely whiffed on the -- 11 THE COURT: What would be an appropriate remedy? If I 12 found for the plaintiffs, what would be an appropriate remedy in 13 your case if there is no irreparable injury for an injunction? 14 I assume you're not going to say, oh, we are able to pay money 15 damages. 16 What would be the appropriate remedy? MR. BRIDGES: I am not able to say, Your Honor, 17 because we feel that the public interest here is huge, and I'll 18 have to address that. 19 inclined to grant an injunction, then I would suggest that we 20 have a separate round to address details. 21 appropriate here, for a variety of reasons. 22 If the Court decides the Court is But it's just not In HathiTrust, the court -- well, that's in hardships. 23 I'll get to that later. But the experts here were their 24 substitute for facts, and their experts did not provide valid 25 bases for claiming irreparable harm. 134 1 What's interesting is, they sort of concede that, because 2 they move their focus to, well, we've lost control. 3 control. 4 because that's what it means to have a copyright infringed. 5 So they're sort of falling back on what eBay says is not 6 important, not relevant, which is mere success. 7 We've lost Well, that's like saying our copyright's been infringed Then they said, oh, but we would suffer reputational harm 8 because people will mistake our product. Well, that is very 9 fixable, and that's not irreparable at all. I guess it could be 10 repaired with a very, very modest injunction which says, put in 11 a disclaimer and say the standards organizations are not 12 responsible for this transcription. 13 But they worry about that. And it's very curious that they mentioned, oh, the problem 14 of quality standards. 15 declaration, and it's really instructive, Your Honor, because 16 Mr. Pauley highlighted a dangerous error. 17 54, one passage left out the phrase "cables rated above 2,000 18 volts shall be shielded." 19 There's a reference to Mr. Pauley's He said in paragraph That was a major mistake, he said. It was NFPA's mistake. It was an error that NFPA corrected 20 with an erratum. 21 law of incorporation by reference is very clear. 22 by reference applies only to the specific document, and it does 23 not extend to any corrections or revisions. 24 25 Why did Public.Resource omit it? Because the Incorporation So, in fact, this was not an error on Public.Resource's part; it was an error on ASTM's part. But because 135 1 Public.Resource is putting out there the very document that is 2 incorporated by reference, it was accurate. 3 became the law. 4 about, and if so, that's something that Public.Resource shows 5 people: This is what got incorporated, and if it's a mistake 6 that NFPA had to correct, well, then as an incorporated law, 7 it's missing something important. 8 and this is actually a reason why Public.Resource's work is good 9 and important, because it's telling people what the law is even 10 11 NFPA's inaccuracy And maybe that's important for people to know So this is very, very key, when NFPA wants to recast what the law really is. The question of remedies at law are inadequate to 12 compensate for the injury? 13 has to be a showing of actual injury, and there just hasn't been. 14 There's a nullity to consider whether remedies are inadequate to 15 compensate for the injury when they haven't shown injury, and 16 they like to retreat behind the thing, oh, the damages are 17 unquantifiable. 18 Well, the presumption is first there Well, that's what expert -- competent experts would usually 19 do, and they didn't have competent experts here. 20 again the admission from ASTM's president, no measurable effect. 21 The plaintiffs' experts didn't analyze what happened in Veeck. 22 And we have They're saying here that there would be terrible harm if 23 they suffer what actually happened in Veeck, and nobody showed 24 that the standards development organizations had to go out of 25 business or couldn't afford to do standards anymore because 136 1 Veeck said they had no right to monopolize them. 2 a case study that their experts chose not to consider. 3 methodology just makes my mind explode. 4 evidence on this. 5 There was The So they just don't have Let's go to the balance of hardships, because this is 6 important. 7 said, when it was discussing hardship for a different purpose -- 8 it was a standing question. 9 "The mere possibility of a future injury, unless it is the cause 10 Again, it assumes actual injury. The Second Circuit But the Second Circuit said, of some present detriment, does not constitute hardship." 11 So what is the hardship, they say? Well, the hardship is, 12 Your Honor, we've had a business model for a hundred years, and 13 it would be hard for us to change it. 14 virtue, and antiquity doesn't deserve for its own sake -- the 15 fact that this business model has been here a hundred years 16 doesn't mean that that's what the business model should always 17 be. 18 Well, antiquity is not a And their documents -- and this is Exhibit 53 where they 19 talk about the next year at NFPA. 20 president, was talking about the need to change the business 21 model anyway because of technological advances. 22 Court to defend this business model is not an appropriate factor 23 to take into consideration when their business model has to 24 change anyway, and evolution of business models is natural. 25 This was NFPA's previous So asking the You know, there had to be an evolution of business models 137 1 for the Southern Building Codes Conference after Veeck. 2 changed West's business model. 3 Lexis's business model. 4 the business model of the courthouse filing and retrieval 5 systems. 6 Lexis Google Scholar is changing Everybody adapts. PACER has threatened Business models evolve, and there's no hardship to say, oh, 7 well, our business model may have to evolve. 8 plaintiffs to exert a monopoly power over the law is not itself 9 a hardship that the Court should take into account. 10 The failure of I want to go back again to one of the experts for AERA, 11 Mr. Geisinger. 12 because he got the years wrong. 13 Public.Resource didn't start posting standards till two years 14 into the catastrophic decline. 15 mistake on the key fact for which he keeps getting cited, it is 16 just not evidence. 17 Complete whiff on the ascription of losses He got the years wrong. When an expert has such a bad So the hardship is not there. Let's talk about the hardship to Public.Resource. 18 No, there would be no financial effect on Public.Resource, but 19 Public.Resource has a mission, and that mission is to make the 20 law accessible to every American: poor Americans as well as rich 21 Americans, disabled Americans as well as abled Americans. 22 one of the things it does is make it possible for all sorts of 23 Americans to do things with the law that bring power to persons 24 to analyze the law, to critique it, to run their data analysis 25 tools on it because of the way they are implemented. And 138 1 There is no other way for Public.Resource to make these 2 public tools available other than by doing what it's doing. 3 So there would be a hardship. 4 would be a hardship to the very beneficial mission of 5 Public.Resource. 6 Not a financial hardship, but it So that takes us to the public interest, and there is a 7 very broad public interest here. Now, I think that the 8 plaintiffs tend to think of their communities as people engaged 9 in building or designing or law enforcement or law making. If 10 you look at all the stakeholders who come together, these are 11 people who are sort of their community. 12 on all the public. 13 They're not so focused I mean, certainly they care about public safety; we grant 14 that. 15 people to try to sort of stick their nose in and find out, well, 16 what's going on with the law making here? 17 the regulations that apply to my child's school or to my child's 18 safety seat? 19 But they're not sort of -- they're not available to What's going on with They require -- for access, by the way, they require -- and 20 I went to the NFPA site. I wanted to see -- I couldn't do it. 21 Because for me to go get that public access, I had to agree to 22 consent to jurisdiction of the states where they're located. 23 I had to enter into a contract, and I had to acknowledge their 24 copyright as a matter of contract in order to have access to 25 their public reading rooms. 139 1 So the fact that I have to enter into a contract, I have to 2 submit to jurisdiction of a distant court? 3 public access. 4 control, our control over the law itself, and that is a problem. 5 That's not real That's exactly what they want. We have a problem, Your Honor. It's our I'm not sure I want to say 6 it's a problem. 7 privatization of public functions. 8 of federal prisons and immigration facilities -- 9 10 11 It's a controversy right now over the THE COURT: We've got private operators Keep your argument, though, to the issue of remedies, because we are really running out of time. MR. BRIDGES: But I think the question is, is a remedy 12 at all important? 13 disserved by an injunction that more allocates to the plaintiffs 14 a private right over controlling access to the law. 15 said it's loss of control. 16 And my point is the public interest would be They have said they have a power to exclude. They have That's fine 17 when it's just an ordinary copyrighted work. 18 they are claiming -- and the phrase is in their briefs: loss of 19 control, power to exclude. 20 exclude anybody from the law, for any reason, that is not in the 21 public interest. 22 It's not fine when When they are claiming a power to The public interest is in having no private gatekeepers to 23 the law, because what everyone thinks about emergency managers 24 in Michigan or privatization of parking meters in Chicago, 25 privatizing the law and giving any private party exclusive 140 1 control and the power to exclude what anybody chooses to do with 2 the law and, oh, maybe it's only $49. 3 right to do what you want to do with the law? 4 it's all yours. That's still saying, your Pay us $49, and This is unconscionable, Your Honor. 5 THE COURT: Or go to the library and make a photocopy. 6 MR. BRIDGES: Your honor, I'm not sure that works for 7 someone in Helena, Montana, or Anaconda, Montana. His statement 8 about accessibility in libraries, it doesn't pan out. 9 one specific version that is incorporated into law, and that's There is 10 not -- his statistics were not right about the specific version. 11 And these are not available widely in public libraries. 12 aren't. 13 They One of the interesting things, a Polish graduate student 14 about Polish law asked them and said, I want to quote this 15 standard in my thesis. 16 thesis, and my thesis will only go to the three people on my 17 thesis committee. 18 just have to cite to it. 19 I want to quote this standard in my And they said, Sorry. This is control. You can't. You'll And when it becomes the law, ordinary 20 control of a copyright holder over a copyrighted work, I get 21 that, but not when it becomes the law, Your Honor. 22 THE COURT: 23 MR. BRIDGES: 24 THE COURT: 25 three minutes. Thank you, Mr. Bridges. Thank you. I have to walk out of this courtroom in All right? 141 1 MR. HUDIS: Real fast. 2 THE COURT: The chief judge is waiting for me, and 3 that's somebody I'm not going to keep waiting. 4 MR. HUDIS: I want to make sure we get this in the 5 record, Your Honor. 6 right on our present harm. 7 paragraphs 24 through 27 of his declaration. He got it right. 8 And Mr. Bridges can pontificate all he wants. We have shown 9 harm. 10 Dr. Geisinger did not whiff. He got it It's submitted into the record, We've shown not only past harm but also likelihood of irreparable future harm. 11 THE COURT: Thank you, Your Honor. All right. Thank you very much. 12 Thank you all for your very hard work and your real effort in 13 presentation and your arguments, which were very well prepared. 14 Thank you. 15 16 17 18 19 20 21 22 23 24 25 (Proceedings adjourned at 12:57 p.m.) 142 * * * * * * CERTIFICATE I, BRYAN A. WAYNE, Official Court Reporter, certify that the foregoing pages are a correct transcript from the record of proceedings in the above-entitled matter. __________________ BRYAN A. WAYNE

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