INTELLECTUAL PROPERTY

A central issue facing DL developers everywhere is what use can be made ofcopyrighted content. Can it be indexed, cataloged, summarized, displayed,distributed, translated, spoken, modified, colorized, morphed, compressed,archived, and mirrored? The general answer is that some of these actions arepermissible without permission of the owner and others are not2. It is a separate question what technologicalmechanisms can be employed to allow that which permissible and render theremainder impossible.

If permission of the copyright owner is required to make particular use of awork, the question reduces to finding the owner, obtaining the permission andrendering any required payment. This process, when performed manually, isextraordinarily slow and is completely inconsistent with the notion of anonline DL. Furthermore, the requested permission may be refused, or may beselectively granted to those who are friendly or sympathetic to the owner. Ifthe ultimate goal is to facilitate the widespread online use of information,with due compensation to owners of content, a system in which certainpermission may be refused is a stumbling block. The Japanese copyright systemprovides the basis for a solution to this problem.

Copyright in the United States primarily protects economic rights, that is,the right to derive income from one's works. The European system leans moreheavily toward the protection of moral rights, those for which violation doesnot necessarily cause monetary damage but results in harm to the creator'sreputation, the integrity of his work, or his right to be acknowledged as anauthor. The systems differ in their treatment of published works. Once anauthor has chosen to make his work available to the public, how much controlmay he retain over its use? In a system focused on economic rights, the controlis designed to ensure that others do not profit unfairly from the work. He whocreates and publishes gives up a measure of other types of control. There is animplied compact with society that in return for one's intellectual production,a limited monopoly is granted to exploit the work for profit. After a certaintime, the rights of any author and owner dissolve, and the work enters thepublic domain, from which it may be freely used by all. The question incomparing economic and moral rights systems is what public uses are permittedfrom the time of publication until entry into the public domain. A moral rightssystem views the compact as more favorable to the author. He has greatercontrol of the work as necessary to protect his reputation and that of thework.

In the DL context, if authors in an economic copyright system can be inducedto grant licenses in return for monetary compensation only, an economic schememust be devised to measure usage and direct the appropriate payment properly.However, the whole arrangement is legally feasible if technology can bedeveloped to support it. A moral rights system imposes potentially insuperablebarriers to DL since authors may simply refuse permission for non-economicreasons and the system will uphold their judgment. In such a case, unless asolution is found, a DL will have to be satisfied with only public-domainmaterial and that for which express permission has been obtained.

Compulsory Licensing

Even in an economic rights system, the owner is able to set an unreasonableprice for usage of his work. While this may mean that he derives no incomebecause he finds no takers, the effect is that the public is deprived of theability to use the work, which is the equivalent of a moral rights system. Asolution is afforded by the notion of "compulsory licensing." This idea,already partially implemented in many countries, is that the author and ownercannot refuse permission for certain types of usage, but the user must pay anestablished fee that is not set by either the owner or user, but by anindependent authority.

Compulsory licensing exists in the United States, but is extremely limited.It is confined to the making of phonorecords of nondramatic musicalworks.3 In simple terms, if one wantsto record a song the copyright owner cannot stop him, even if the performercan't sing a note. All one has to do is serve a notice on the copyright ownerof an intention to invoke a compulsory license in his song. One then pays afixed fee (based on the length of the recording) for every copy made. The feeis set by statute and does not vary based on the nature or popularity of thework recorded. Popularity enters into the picture indirectly; if the recordingbecome a best seller, both the performer and the copyright owner willbenefit.

Compulsory licensing is beneficial to DL because: (1) material can be madeavailable to all at a fixed price known in advance; and (2) technologicalsolutions exist to record licensees and secure payment. In the United States,the provision will have to be expanded to include various uses of allcopyrighted works, not just phonorecords of musical works.

Unless a compulsory license in available, in the United States the copyrightowner has an absolute right to prevent use of his property (subject to "fairuse" exceptions, which ordinarily do not include commercial uses). The rightdoes not have to be exercised reasonably or fairly-it is a property rightentitled to slavish protection. The situation, as we shall see, is verydifferent in Japan because of extensive compulsory licensing.

Performing Rights Societies

Suppose a radio station wants to play music all day long. (Playing music isnot subject to compulsory license; that's restricted to making recordings.) Itwould be impossible for the station to negotiate with the copyright owner ofevery piece it might want to play. To solve this problem, the United Statesrecognizes certain performing rights societies (such as BMI and ASCAP) thatsecure the performance rights to large collections of music and license them intoto to numerous licensees, such as radio stations, restaurants, nightclubs andthe like. The royalties are pooled, and distributed to the copyright ownersbased on statistical estimates of usage.

Performing rights societies are beneficial to DL because (1) material iseasily available through large catalogs that can be maintained online; and (2)precise measurement of usage is possible to permit accurate distribution ofroyalties.

The Japanese Copyright System

The Japanese copyright system is approximately 100 years old, less than halfthat of its U.S. counterpart. It deliberately combines features of both theU.S. and European systems and is much more refined than either in the area ofmodern technologies, such as software, databases and digital transmission.Japan is a party to most major international copyright agreements, such as theBerne Convention, respecting the rights of foreign authors.

Under no circumstances should Japan be confused with certain other Asiancountries that have only limited regard for copyright. Japan is even morerespectful of copyright than the United States, and government DL policy isspecifically crafted to acknowledge such rights. The MITI report states, "Toprevent unlawful duplication, strict enforcement of the Copyright Law isnecessary, as well as raising the awareness of all users regarding this issue,and proper management of software by enterprises and others so as to preventillicit duplication by employees ..."

The Japanese culture esteems individual artistic creativity, a point that isreflected in its copyright laws. There is a prevailing Western misunderstandingthat creativity is discouraged in Japan because it conflicts with group harmonyand collective decision making. Some authors compound the error by using it to"explain" the gap in software development between the United States and Japan.If anything, the Japanese find art and creative expression in many directionsthat would be considered mundane in the United States. This is relevant to DLsbecause (1) DLs create new opportunities for individual expression andpublishing; and (2) DLs make heavy use of multimedia, combining work from manysources (such as calligraphy) that are protected in Japan. The Japanese systemis richer than the U.S. system in the following ways that impact DLs:

Japanese Copyright Administration

In the United States, copyright is administered by the Library of Congress(LC), part of the legislative branch of government. Its principal role is toensure that Congress has access to extensive holdings of research material forits deliberations and, to that extent, is archival in nature. Our statuteprovides for copyright registrants of published works to furnish the CopyrightOffice with two copies of the work, one of which will repose in the LC. Thecopyright system therefore provides a guaranteed flow of material into theLC.

The Japanese copyright system is administered by the Agency for CulturalAffairs (ACA) of the Ministry of Education, the same ministry that promotes DLsthroughout Japan. The Japanese view the copyright system as an adjunct toeducation rather than as an archival or primarily legal function. This permitsJapan to turn its copyright function and policies in the direction of DLs withmuch greater ease than in the United States, where an act of Congress isrequired to implement any significant policy change.

The ACA established a Special Office for Multimedia in 1992, and theNational Diet Library has enacted new rights specifically addressing copyrightin digitized and networked environments.

The Japanese Copyright Law

Japan greatly respects proprietary rights of all kinds, includingintellectual property. The crime rate is low, which indicates a nearlyuniversal regard for personal property. The author's own experience is that theJapanese are honest to a fault, and appropriation of the work of another isvirtually unthinkable. This tone is reflected in the copyright system, whichprovides many avenues for obtaining use licenses and ensures equitabledistribution of profits to creators.

Litigation is generally rare in Japan, and copyright cases more commonlyinvolve difficult issues of law, such as what is copyrightable, rather thaninstances of piracy, which are severely punished as crimes. While in the UnitedStates certain types of infringement may be prosecuted as crimes, in Japan anyinfringement of a copyright, moral right or neighboring right (discussed below)is subject to fine and imprisonment.

The Japanese copyright law is an expanded grafting of U.S. and European(moral rights) legislation, harmonized to a great extent with internationalconventions. It recognizes copyright and the moral rights of attribution andintegrity, which last for the life of the author plus 50 years, as in theUnited States. Copyright in the United States comprises a bundle of fiverights, which may be further subdivided or separately licensed by their owner:reproduction, preparation of derivative works, distribution, performance anddisplay. Japanese copyright (chosakuken, literally, "authorship right")recognizes at least 12 separate rights, some of which have no counterpart inthe United States. Furthermore, in Japan these rights are more finely divisiblethan they are here.

Japan provides for a statutory "right of publication" (shuppanken),which is separate from ownership of the work and imposes an obligation on theholder of the right to publish the work within three years from the date ofgrant, even in the absence of any agreement between the owner and thepublisher. Other rights having no direct U.S. counterpart are the right ofrecitation and the right of the original author in the exploitation of aderivative work.

Japanese moral rights (jinkakuken) are also more extensive, includingthe right to edit subsequent publications of a work, terminate a right ofpublication under certain conditions and prevent use of a work in conflict withthe author's beliefs.

Japan recognizes "neighboring rights," which possess only rough analogues inU.S. law. These are very modern and include the right of interactivetransmission, a critical protection for Web developers, and the right of"making transmittable," which means transforming a work so that it can bebroadcast or sent over networks. The category also includes the right ofrebroadcasting and various cable and sound recording rights.

Japanese copyright law protects "databases which possess creativity in theselection or systematic organization of ... information," a fact of greatsignificance to DLs. A database is defined as a computer-readable collection,which includes everything in a DL. The United States is now struggling withprotection for databases, and even the present bill before Congress (H.R. 2652)has been found by the Justice Department to be unconstitutional becausecopyright in the United States is limited to works of authorship rather thanproducts of industrious collection4.It is unclear whether extensive protection for databases or an absence thereofwould do more to promote digital libraries. However, uncertainty over thematter is not likely to help.

Japanese copyright law is better suited to protection of interactive mediadisplays. For example, in the United States the shape of the letters in a typefont is not copyrightable5. In Japan,artistic calligraphy is copyrightable.

Japanese Compulsory Licensing

Compulsory licensing in Japan is extensive in ways that bode well fordigital collections. A major digitization problem in the United States, forexample, is raised by out-of-print works that are not so old as to bedefinitely out of copyright and whose copyright owner cannot be located. If oneof these works is digitized and added to an electronic library, the operatorrisks being sued at any time, assessed damages and ordered by injunction todelete the work. Moreover, any computer on which the work is resident may beseized without notice. On the other hand, it is likely in many cases thateither the copyright has expired or that the owner, even if he becomes aware ofthe use being made of the work, will interpose no objection. There is no safeprocedure in the United States to make use of out-of-print materials exceptpermission of the copyright owner.

The situation is different in Japan. If the copyright owner of a work cannotbe located after diligent effort, the potential user need only to apply to theACA for a compulsory license. A royalty rate will be set, and the user must paythe royalty to the ACA, where it will be held in the event the author surfaces.If so, the author may not prevent use of the work, but must be content with theestablished royalty. It is obvious that such a provision facilitates digitallibraries because such material can be used without risk (but at some cost). InJapan, compulsory licensing applies to the following areas:

Author's Rights Organizations

These are the Japanese counterpart of performing rights societies in theUnited States. They are non-governmental organizations (NGOs) representing asignificant component of the community of creators, usually divided by type ofwork, such as books, music, and the like. When no compulsory license isavailable under Japanese law, resort may be had to the author's rightsorganizations to secure bulk licenses. The set of such entities in Japan ismuch more populous than it is in the United States and includes thefollowing:

Rights Clearance

In the event that no compulsory license is available and licensing is notmanaged by an author's rights organization, an individual negotiation with thecopyright owner is required. In the United States, merely locating thecopyright owner can be a formidable chore and sometimes requires legal counselto conduct a search, which at best is unreliable.6 In Japan, resort may be had to J-CIS, the Japan CopyrightInformation Service, an organization that exists specifically to facilitate thelicensing of copyrighted works, and one that has no counterpart in the UnitedStates

Fair Use

"Fair use" in the United States is an activity that would literallyconstitute copyright infringement if not for a legally recognized exception. Inaddition to a wide menu of compulsory licenses, there is a wider recognition ofthe fair use principle in Japan than in the United States. For example,personal use in Japan is almost always fair. The United States instead looks atthe economic loss to the owner, and concludes that a use is usually not fair ifit affects the demand for the original, which is not the test in Japan. Fairuse, of course, promotes digital libraries to the extent they facilitate suchuses.

Japanese Copyright Proposals to Enhance Digital Libraries

Prof. Makoto Nagao, now President of Kyoto University and the leadingacademic proponent of digital libraries in Japan, has put forward a proposalfor modification of Japanese copyright law and policy to promote digitallibraries (Nagao n.d.). It begins with the premise that authors and publishersmust be paid for their works. Its salient points are:

Prof. Nagao then delves into the problem of how to charge for the use ofworks, a topic discussed in the next section.

Summary

No one seriously suggests eliminating copyright to promote the digitizationof information. The result would be a precipitous decline in professionalwriting. The U.S. stance on copyright is rather inflexible-any effort to expandthe use of works is seen as a threat to revenue and hence a detriment toeconomic interests. In Japan, on the other hand, copyright is seen as a tool toserve society, education in particular. While the Japanese assiduously protectprivate interests, they regard financial compensation as sufficient and do notinvest authors with the near-absolute power to control the source of thatrevenue. Japan therefore leads the United States significantly in the area ofcopyright policy and implementation as it applies to digital libraries.


2 In this chapter, theusual copyright distinction is made between the author of a work (its creator)and an owner of the copyright in a work (a party having the ability to enforcecertain rights). The author and owner may be the same or differententities.
3 17 U.S.C. 115. Retransmissionof cable broadcasts is also sometimes referred to as a compulsory license, butis more akin to a telephone company tariff in that no authorization is given toexploit the work in any way but to carry it intact.
4 "Memorandum for William P.Marshall, Associate White House Counsel, re: Constitutional Concerns Raised bythe Collections of Information Antipiracy Act, H.R. 2652," from William MichaelTreanor, Office of Legal Counsel, U.S. Department of Justice, dated July 28,1998.
5 Some digital type foundrieshave attempted to protect digital fonts as computer programs, but this wouldonly prevent copying the digitized form of the font. It would not protect theappearance of the characters.
6 For example, in the UnitedStates, works may be anonymous or pseudonymous and can be registered forcopyright under alternate titles not listed in the works themselves, all ofwhich complicates searching.

Published: February 1999; WTECHyper-Librarian