Editors' note: Declan responds to critiques of this post in a subsequent piece he wrote in his Taking Liberties blog at CBSNews.com: "Cap And Trade Redux: $1,761 Annually Per Family? Or Not?"
The Obama administration has privately concluded that a cap and trade law would cost American taxpayers up to $200 billion a year, the equivalent of hiking personal income taxes by about 15 percent.
A previously unreleased analysis prepared by the U.S. Department of Treasury says the total in new taxes would be between $100 billion to $200 billion a year. At the upper end of the administration's estimate, the cost per American household would be an extra $1,761 a year.
A second memorandum, which was prepared for Obama's transition team after the November election, says this about climate change policies: "Economic costs will likely be on the order of 1 percent of GDP, making them equal in scale to all existing environmental regulation."
The documents (PDF) were obtained under the Freedom of Information Act by the free-market Competitive Enterprise Institute and released on Tuesday.
These disclosures will probably not aid the political prospects of the Democrats' cap and trade bill. The House of Representatives approved it by a remarkably narrow margin in June--the bill would have failed if only six House members had switched their votes to "no"--and it faces significant opposition in the Senate.
Cap and trade--or emissions trading--is an approach to reducing pollutants by offering companies financial incentives to clean up their acts. The current bill focuses specifically on reducing greenhouse gases linked to climate change.
One reason the bill faces an uncertain future is concern about its cost. House Republican Leader John Boehner has estimated the additional tax bill would be at $366 billion a year, or $3,100 a year per family. Democrats have pointed to estimates from MIT's John Reilly, who put the cost (PDF) at $800 a year per family and noted that tax credits to low income households could offset part of the bite. The Heritage Foundation says that, by 2035, "the typical family of four will see its direct energy costs rise by over $1,500 per year."
One difference is that while Heritage's numbers are talking about 26 years in the future, the Treasury Department's figures don't have a time limit.
"Heritage is saying publicly what the administration is saying to itself privately," says Christopher Horner, a senior fellow at the Competitive Enterprise Institute who filed the FOIA request. "It's nice to see they're not spinning each other behind closed doors."
"They're not telling you the cost--they're not telling you the benefit," says Horner, who wrote the Politically Incorrect Guide to Global Warming. "If they don't tell you the cost, and they don't tell you the benefit, what are they telling you? They're just talking about global salvation."
The FOIA'd document written by Judson Jaffe, who joined the Treasury Department's Office of Environment and Energy in January 2009, says: "Given the administration's proposal to auction all emission allowances, a cap-and-trade program could generate federal receipts on the order of $100 (billion) to $200 billion annually." (Obviously, any final cap-and-trade system may be different from what Obama had proposed, and could yield higher or lower taxes.)
Because personal income tax revenues bring in around $1.37 trillion a year, a $200 billion additional tax would be the equivalent of a 15 percent increase a year. A $100 billion additional tax would represent a 7 percent or 8 percent increase a year.
One odd point: The document written by Jaffee includes this line: "It will raise energy prices and impose annual costs on the order of XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX." The Treasury Department redacted the rest of the sentence with a thick black line.
The Freedom of Information Act, of course, contains no this-might-embarrass-the-president exemption (nor, for that matter, should federal agencies be in the business of possibly suppressing dissenting climate change voices). You'd hope the presidential administration that boasts of being the "most open and transparent in history" would be more forthcoming than this.
Update 9/16/2009: The Environmental Defense Fund has responded to the documents' release with a statement saying, in part:
Even if a 100 percent auction was a live legislative proposal, which it's not, that math ignores the redistribution of revenue back to consumers. It only looks at one side of the balance sheet. It would only be true if you think the Administration was going to pile all the cash on the White House lawn and set it on fire. The bill passed by the House sends the value of pollution permits to consumers, and it contains robust cost-containment provisions. Every credible and independent economic analysis of the American Clean Energy and Security Act (such as those done by the non-partisan Congressional Budget Office, the Energy Information Administration, and the Environmental Protection Agency) says the costs will be small and affordable -- and that the U.S. economy will grow with a cap on carbon.
iStockphoto, a Getty Images subsidiary that licenses photos and other content for relatively low cost, is hoping to benefit by reassuring customers concerned about violating others' intellectual property rights.
iStockphoto's Kelly Thompson
(Credit: Stephen Shankland/CNET)Adding photographs can improve advertisements, brochures, and other content, but getting sued for inappropriately using another company's trademark or violating an individual's privacy is buzzkill. As a result, iStockphoto has now begun promoting a legal guarantee under which the company will cover up to $10,000 in legal expenses in cases involving trademark, copyright or other intellectual property rights, and privacy rights.
It's included with any file purchased from the company. For those who want more, iStockphoto will increase the coverage to $250,000 at a cost of 100 of the credits ordinarily used to purchase photos, videos, audio clips, and graphics. Presently, credits cost between 95 cents and $1.50, with lower per-credit prices when purchased in bulk.
The company essentially is trying to capitalize on the risks involved when using content that's freely downloaded from the Web or produced on one's own, eagerly pointing out that even stitching patterns on jeans can be trademarked.
"There are certainly millions of images available on the Web, but most are not cleared for commercial usage. Creative Commons images can be perfect for some projects, but there are little to no formal inspections on those files, so iStock offers a much safer and suitable alternative when using multimedia," iStockphoto Chief Operating Officer Kelly Thompson said in a statement.
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The state of Virginia has backed away from its attempts to force Facebook to divulge the complete contents of a user's account to settle a dispute over workers' compensation, narrowly avoiding what promised to be a high-profile privacy battle in federal court.
On Monday, the Virginia's Workers Compensation Commission said it was no longer going to levy a $200-a-day fine on the social-networking site for refusing to comply with a subpoena from an airline that previously employed a flight attendant named Shana Hensley.
Facebook had objected to the June 4 subpoena from Colgan Air--the Manassas, Va.-based company that operates under the names United Express, US Airways Express, and Continental Connection--on privacy grounds. It said federal law prohibits divulging user data in response to a subpoena, and promised to "further litigate this issue by seeking, among other things, an injunction from the federal courts."
In principle, this isn't a novel concept: employers and insurance companies have long used private investigators to ferret out fraud and show that someone who claims to be a virtual cripple actually participates in waterskiing competitions.
Because social-networking sites offer such information-rich glimpses into a person's private life, insurers and employers have begun eyeing them. A personal injury lawyer in Elmira, N.Y., noted in July that an accident victim claiming to be severely injured was, thanks to Facebook, revealed to be playing in soccer games. An article last week in Business Insurance said that social-networking sites revealed exaggerated claims of injuries from a judo instructor, a bowler, and a rodeo bronco rider.
In the Colgan Air case, Facebook says it's happy that privacy rights prevailed. "We're pleased with the outcome and that our users' information will be protected," said Facebook spokesman Barry Schnitt.
Colgan Air, which is owned by the publicly traded Pinnacle Airlines, initially paid Hensley's disability benefits that were related to a back injury while on the job (she was diagnosed with a herniated disc that did not want surgery). After about 18 months, however, Colgan Air claimed that Hensley was not cooperating with its efforts to find her a desk job and appears to have concluded that Hensley's holiday vacation photos posted on her Facebook account would demonstrate that any back problems were not severe.
The airline's June 4 subpoena from Virginia attorney Charles Midkiff (PDF) demands "all documents, electronic or otherwise, related directly or indirectly, to all activities, writings, photos, comments, e-mails, and/or postings" on Hensley's Facebook account.
Six days later, Facebook responded, saying that the request must come from a California court, and that it was "overly broad" because the federal Electronic Communications Privacy Act (ECPA) protects the privacy of user accounts. Midkiff, the airline's lawyer, replied by requesting a "contempt citation against Facebook" from the Virginia's Workers Compensation Commission.
Randolph Tabb, a deputy worker's compensation commissioner, granted it. On August 28, Tabb held Facebook in contempt for "a failure to comply" and ordered a $200-a-day fine "until such time as compliance is satisfied by the production of said documentation."
Facebook's response to Tabb sent last week says that "users such as Ms. Hensley rely on Facebook to protect their data and vigorously enforce the privacy decisions they make on Facebook." It adds: "Courts have interpreted the ECPA to prohibit services such as Facebook from producing a non-consenting subscriber's communications even when those communications are sought pursuant to a court order or subpoena."
Put another way: unless you change your mind, we'll see you in federal court.
It worked. Tabb backed down, reversing his previous ruling and fine, and claimed that Facebook should have made the full scope of its objections clear earlier.
James Szablewicz, Virginia's chief deputy worker's compensation commissioner, said in an interview on Monday that he didn't know of any other case involving Facebook that his colleagues have faced. "I think it's a pretty good chance that this is a case of first impression for us," he said.
Privacy advocates applauded Monday's decision, likening it to Google's mostly successful effort to fend off a subpoena from the Justice Department three years ago. Jim Dempsey, a vice president of the Center for Democracy and Technology, said: "Too often, lawyers in civil cases are turning to service providers like Facebook, AOL, and Google with fishing requests. The law is clear--service providers cannot turn over content in civil cases."
Kevin Bankston, a senior staff attorney at the Electronic Frontier Foundation, said the principles are similar to the one involving Apple Computer's efforts to unmask product leakers (the case is O'Grady v. Superior Court). "We were very glad to see that the rule of law we helped to establish in the O'Grady case is being used to ensure that Facebook content is not disclosed in violation of federal privacy statutes."
There's an ironic ending to this story. Julie Heiden, a Virginia personal injury lawyer representing the former flight attendant, Shana Hensley, said in an interview on Monday that the subpoena won't be necessary after all.
"We agreed to sign a release," Heiden said, meaning a document that authorizes Facebook to disclose the contents of Hensley's account to her former employer. "Shana has executed the release...She has nothing to hide."
Update 9/15/2009: Colgan Air spokesman Joe Williams says: "As you might expect, we do not comment on pending litigation."
Oracle is touting its alliance with Sun.
(Credit: Screenshot by Stephen Shankland/CNET)Oracle isn't letting a pesky EU investigation stand in the way of its planned acquisition of Sun Microsystems.
Larry Ellison, the software giant's chief executive, is joining Sun's server chief, John Fowler, to show off some new Sun hardware running Oracle's software on Tuesday. The companies are touting their "partnership" with a jointly branded "Exadata" system shown in a Webcast invitation sent to press and published by both Oracle and Sun.
"You are invited to attend an exclusive webcast event where Oracle CEO Larry Ellison will unveil an innovative new product, the world's first OLTP (online transaction processing) database machine with Sun's brand new FlashFire technology," the invitation said. "Don't miss this opportunity to learn firsthand how the partnership between Oracle and Sun can benefit your business now and in the future."
Sun has been working on systems that take advantage of solid-state drives (SSDs), which use flash memory to store data rather than traditional hard drives with rotating platters that can store data in tiny magnetic patches. One advantage of such systems is that it's easier to retrieve data scattered in different locations over a drive, which can make reading and writing data faster. However, flash drives cost much more per gigabyte to store data than traditional hard drives.
Notable here is that Oracle is helping preserve the value of the asset it hopes to acquire. As Illuminata analyst Jonathan Eunice observes, Oracle is trying to counteract IBM and Hewlett-Packard programs to steal away Sun customers who might be hesitating over Sun's current limbo and its inevitable future changes.
Oracle is of course a software company, and one of its biggest challenges in acquiring Sun will be embracing hardware as well, even if it's in some subordinate role that mostly serves as a delivery vehicle for the software. Hardware still takes immense resources to design, qualify, test, manufacturer, and support to compete on the level of IBM and HP.
Tuesday's event telegraphs that Oracle does indeed care about Sun's hardware. So do marketing missives proclaiming that Oracle plans to spend more money developing both servers with Sparc processors and Sun's Solaris operating system than Sun does today.
Oracle doubtless is frustrated by the EU's intransigence, which centers on the open-source MySQL database software that competes with Oracle's own core database product. But it's doing the best it can to keep Sun's hardware business alive.
A federal appeals court on Friday affirmed a lower court ruling that Microsoft infringed on a patent owned by Alcatel-Lucent, but said the jury award of $358 million in damages was excessive.
The U.S. Court of Appeals for the Federal Circuit in Washington, D.C., upheld a ruling that the patent at issue was valid and had been infringed on, but said there was not sufficient evidence to support the calculation of damages. The question of damages was sent back to the district court.
The patent, whose application was originally filed by engineers at AT&T, covers a method of entering information into fields on a computer screen without using a keyboard. Lucent initially sued computer maker Gateway for the patent infringement in 2002 and Microsoft subsequently intervened. Dell is listed as a third defendant in the case.
The trial court found that the "date-picker" calendar tool in Microsoft Outlook, and similar features in Microsoft Money and Windows Mobile, infringe on what the court refers to as the "Day patent." However, for damages purposes, the court said there was no evidence of widespread use of the infringing tool by customers and questioned the calculation of damages.
Alcatel-Lucent argued that it was owed damages representing 8 percent of the revenue of Microsoft's sales. The jury apparently arrived at its sum based on that percentage of Microsoft's sales or the entire market value of the software products that contain the feature, the opinion said. Microsoft, meanwhile, had suggested a sum of $6.5 million. The appeals court did not suggest a method for calculating the damages, but said the amount chosen by the jury was out of proportion to the potential for infringing use.
The infringing feature is a tiny piece of a large software program, and thus "the portion of the profit that can be credited to the infringing use of the date-picker tool is exceedingly small," the ruling said.
"In short, Outlook is an enormously complex software program comprising hundreds, if not thousands or even more, features. We find it inconceivable to conclude, based on the present record, that the use of one small feature, the date-picker, constitutes a substantial portion of the value of Outlook," the court said.
Representatives from both Microsoft and Alcatel-Lucent said they were pleased with the ruling.
"We are pleased that the court vacated the damages award, and we look forward to taking the next step in the judicial process," Microsoft spokesman Kevin Kutz said in a statement.
"We are very pleased with this decision by the U.S. Court of Appeals for the Federal Circuit affirming the jury's decision that Microsoft infringed the Alcatel-Lucent Day patent and that the Day patent is a valid patent," Alcatel-Lucent spokeswoman Mary Ward said in a statement.
"While we are disappointed that the court did not affirm the jury's decision on damages, we look forward to an upcoming proceeding to determine the compensation to which Alcatel-Lucent is entitled based on the court's finding that Microsoft did use our patented invention, which Microsoft included in each of the infringing products, presumably because they recognized that it added real value for their customers," she said.
The case is just one of a number of patent infringement cases the two companies have filed against each other over the years including cases involving the MP3 format, as well as communications technology, and digital speech compression.
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The U.S. Department of Justice has furthered its investigation into the proposed search engine deal between Microsoft and Yahoo by asking both companies to provide more information.
The two companies received an additional request for information earlier this week as expected, Microsoft spokesman Jack Evans told CNET News. He said he couldn't reveal the specifics of the request, citing it as a confidential inquiry from the Justice Department. But he said Microsoft is in the process of providing the requested information.
Yahoo spokesman Adam Grossberg also confirmed to CNET News the Justice Department's request. He couldn't comment on the specifics either but added that Yahoo is cooperating fully.
"We confidently believe the information we'll provide will confirm that the deal is not only good for Yahoo and Microsoft, but also good for advertisers, publishers, and, ultimately, consumers," said Grossberg.
The request for additional information doesn't come as a surprise to either Microsoft or Yahoo.
Under the Hart-Scott-Rodino Act, mergers or other business deals that meet certain requirements must be reviewed by the government before they can close. Companies have to file the necessary paperwork with the government and then wait 30 days before given clearance to move forward. In some cases, the government requests additional information before making a decision.
Both Microsoft and Yahoo were anticipating a close review of the deal given its scope, said Evans. At a press conference when the deal was announced, the companies said the review would be a matter of months, not weeks, taking it through the fall.
Despite the Justice Department's request for more details, both Microsoft and Yahoo are hopeful the deal will close as expected in early 2010.
Still, the Justice Department is only one battle. The agreement may also require regulatory clearance by the European Commission, which has been tough in its current probe of Oracle-Sun and in past probes of both Intel and Microsoft. Microsoft is currently trying to determine what formal notification, if any, needs to occur in Europe.
But a Microsoft-Yahoo search combination may be seen as less of a competitive threat in Europe where Google enjoys a 90 percent share of the search engine market versus its U.S. share, which ranges anywhere from 63 percent to 72 percent based on recent estimates.
Yahoo and Microsoft announced the deal in July, under which Bing's search engine technology would power Yahoo Search, and Yahoo would sell ad space next to search results, with the two companies splitting the sales.
Google offered an olive branch to rivals of its digital book efforts at a congressional hearing Thursday, but Amazon was having none of it.
David Drummond, Google's chief legal officer, testifies before Congress.
(Credit: Screenshot by Stephen Shankland/CNET)The move involves a major point of contention in Google's project to bring books to the Internet and in a proposed settlement of class-action suits that author and publisher groups brought against the project. Specifically, Google announced a reseller program that would let competitors get some measure of the rights--and revenue--that Google itself could get through the settlement.
"Any bookseller--Amazon, Barnes & Noble, Microsoft--would be able to sell the books covered by the settlement," said David C. Drummond, Google's chief legal officer. Under the proposed settlement, Google would get 37 percent of revenue from e-books sold through its service, and through the reseller program, the reseller would get "the significant majority" of that 37 percent, Drummond said.
He announced the offer during a House Judiciary Committee hearing on digital books issues raised by Google Books project. If the settlement is approved, Google would get the right to sell not just books for which it had explicit agreements with rights holders, but also for out-of-print books that still are in copyright for which Google doesn't have explicit permission.
That blanket permission has worried some, notably Amazon, which has scanned 3 million books with permission and opposes the settlement. Drummond explicitly said Amazon would be allowed to participate the revenue-sharing program.
Amazon: No thanks
But Amazon indicated it's not interested after Judiciary Committee Chairman John Conyers, a Democrat from Michigan, asked the company's reaction to this "thrilling new piece of information" from Google.
Paul Misener, Amazon's vice president of global policy
(Credit: Screenshot by Stephen Shankland/CNET)"The Internet has never been about intermediation," said Paul Misener, Amazon's vice president of global policy. "We're happy to work with rights holders without anybody else's help."
The hearing revealed some representatives, including the chairman, to be allies of Google. Also generally speaking in favor of Google's work were Zoe Lofgren and Brad Sherman, both Democrats from California.
"It is a good thing to provide millions of Americans access to published works that otherwise wouldn't be available to them," Conyers said. "A library available to every household with an Internet connection--this could be the greatest innovation in book publishing since the Gutenberg press."
But a high-profile opponent emerged in Marybeth Peters, the register of copyrights at the U.S. Copyright Office.
"By permitting Google to engage in an array of new uses, the settlement would alter the landscape of copyright law," in effect subjecting authors to "compulsory licenses" for their works, Peters said.
"Compulsory licenses are the domain of Congress, not the courts," she said, adding that the settlement could cause diplomatic stress for the United States because foreign authors' books are in U.S. library collections that Google is scanning.
Opting in or out
Google wants to be able to sell electronic books online and has scanned 10 million books since 2004 as part of the program. About 2 million are out of copyright, meaning Google and anyone else may do as they like with them; about 2 million are in copyright and in print, with Google establishing permission from rights holders; and about 6 million are in copyright and out of print. It's this last category that's so contentious--particularly in the case of "orphaned" books, whose rights holders can't be located.
Misener specifically objected to the way in which the class-action suit would give Google the right to sell access to the in-copyright, out-of-print books without obtaining permission first.
Google is the only entity in the world that could approach copyright as an opt-out mechanism," Misener said, meaning that authors and publishers are included in the Google project by default. "Everybody else faces the current legal regime, which is opt-in."
Marybeth Peters, the register of copyrights at the U.S. Copyright Office
(Credit: Screenshot by Stephen Shankland/CNET)Sharing Misener's concerns was Rep. Hank Johnson, a Democrat from Georgia. "I'm troubled by the exclusive access Google will have to orphaned works. Why should Google be the only entity permitted to sell orphaned works?" he asked. And he believes the case in the courts could edge in on the job of his own branch of government.
Orphaned works rights-holders aren't completely ignored in the proposed settlement, though. It would create a nonprofit organization called the Books Rights Registry that would collect sales revenue--minus Google's cut--and use that money to locate missing rights holders of and compensate them and other rights holders.
Google argues its program will let millions of out-of-print books generate revenue once again, including orphaned works. Reinforcing Google's point, Sherman criticized Amazon for focusing on digitizing bestsellers but not bothering to bring other books to the electronic realm.
Misener stood by Amazon's position, though. "We are not scanning books for which rights holders cannot be found in advance. That's the way the law requires," he said.
Sherman countered by likening the orphan-works situation to that of unclaimed property. "We want unused property and unclaimed property to be made use of, and we want the ultimate owner to be compensated when found," he said. "To say all that knowledge should be locked up and unavailable to humankind doesn't seem to be in the interest of knowledge."
Congress or the courts?
Conyers indicated he doesn't see the orphaned-works issue as an issue that can't be resolved.
House Judiciary Committee Chairman John Conyers
(Credit: Screenshot by Stephen Shankland/CNET)"My primary concern is because Google reached this settlement, they now have exclusive access to orphaned works," Conyer said. "This can be remedied by legislation."
Such legislation hasn't been easy to come by, though. The House and Senate have worked on it in recent years but have yet to pass any new law. Google's proposed settlement raises the issue that for one company at least, the orphan-works issue could be settled in the judicial branch of government rather than the legislative branch.
"The best protection of the prerogatives of the legislative branch is for us to legislate. Since we have haven't done very effectively the legislation on the orphaned works, it's hard for me to condemn the courts to have a case before it that determines what can be done and can't be done with orphaned works," said Rep. Mel Watt, a Democrat from North Carolina.
Johnson disagreed. "The settlement is coming very close to whittling away the powers of the U.S. Congress. The treatment of orphaned rights holders is a matter that should be determined by Congress," he said.
Things get even more complicated, too: the executive branch, in the form of the Justice Department, is investigating the proposed Google Books settlement.
For its part, Google has no objection to legislation--even if it grants competitors rights to the same books the proposed settlement would give it access to. "We support Congress going in and legislating around that," Drummond said.
Updated at 11:15 a.m. PDT with further detail from the hearing.
Microsoft has at times alleged patent infringement in its attempts to stifle certain Linux-based applications. But one group is hoping to fight back by using Microsoft's own former patents.
The Open Invention Network (OIN), a group made up of Microsoft competitors and Linux advocates,said it's close an agreement to buy 22 patents that Microsoft sold to another organization earlier this year. According to Tuesday's Wall Street Journal, the patents may relate to Linux.
The OIN believes that getting these patents is critical to protecting Linux developers from costly lawsuits, according to the Journal. The concern is that otherwise the patents could be grabbed by patent trolls, which will then try to make money from patent-infringement lawsuits.
The group that currently owns the patents, Allied Security Trust, buys them to protect its members from lawsuits. Composed of such companies as Google, Hewlett-Packard, Verizon Communications, and Cisco Systems, Allied Security Trust bought the patents in a private auction held by Microsoft. The Journal reports that Microsoft presented the patents to potential bidders as relating to Linux.
Microsoft has said that it holds more than 50,000 patents, according to the Journal, and that it believes 200 of those are violated by Linux applications.
Over the past few years, Microsoft has signed deals with several open-source companies in which they pay Microsoft money to protect themselves from intellectual property claims.
The OIN's goal is to promote and protect Linux by using patents that allow for free and open collaboration. The group says its patents are available to any company or individual that agrees not to assert those patents against Linux. The idea is to help developers use Linux without having to worry about violating existing patents.
The OIN is trying to use such cases as the recent lawsuit between Microsoft and GPS-maker Tom Tom to prevent similar actions against Linux-based apps. Although Tom Tom settled with Microsoft, the OIN is concerned that the case may establish a precedent.
Started in 2005, the OIN counts among its members IBM, Sony, and Red Hat. Over the years, other powerhouses have joined, including Oracle, Google, and most recently Tom Tom.
Flickr has adopted a less severe way of handling copyright infringement claims after a small firestorm of controversy erupted about a photograph of President Barack Obama modified to look like The Dark Knight's rendition of the Joker comic-book villain.
Previously, certain copyright infringement complaints were met with the removal of an image, and if the complaint was overruled, the Flickr member who posted the image was allowed to repost it. After the Joker Obama case, Flickr decided to merely replace the image in question with a message, a move that means the discussion below the image is preserved and that eases republication if the removal is overturned.
The Obama Joker image still is widespread on Flickr.
(Credit: Screenshot by Stephen Shankland/CNET)The move illustrates the complexities that have arisen in the digital era where photos can be transferred and modified with ease. Copyright law is a much older concept than the Internet, though it's been renovated a bit relatively recently with the Digital Millennium Copyright Act.
Under the DMCA, a party holding copyright to a photo or other work can request that a Web site remove content posted by a third party that infringes that copyright; the Web site can avoid liability in the matter if it takes down the work in question when it receives the notice of infringement. The DMCA also includes a provision to let the third party that published the content challenge the claim.
The Joker Obama image was swept up in this DMCA process in August. The resulting discussion led the Yahoo photo-sharing site to change its policy Tuesday:
"Upon receipt of a complete NOI (notice of infringement), the U.S. Copyright Team will replace the image with a new static image that bears the following copy: 'This image has been removed due to a claim of copyright infringement,'" said Heather Champ, Flickr's director of community, in a comment.
The change was the suggestion of a Flickr user, The Searcher, and Flickr said it liked the idea.
The Obama Joker image was posted on the Flickr site of Firas Alkhateeb, who told the Los Angeles Times he created the Obama Joker image using Photoshop and a Time Magazine cover photograph. The Obama Joker image spread farther after somebody else created a poster with the image and the word "socialism."
Flickr, though, removed the image after it received a DMCA notice of infringement, Champ said in a forum posting.
Among those to criticize the move were Thomas Hawk, an outspoken critic of what he sees as Flickr censorship and the chief executive of Flickr rival Zooomr. He argued in a blog post that the image qualified as a parody under the fair-use provision of copyright law that permits some uses of copyright material.
"Whatever you may or may not think about this image and its appropriateness, the image would absolutely and unequivocally be considered parody and parody has always been one of the most effective defenses against any copyright complaint," Hawk wrote.
Added TechCrunch's Mike Arrington, "In the past Flickr has deleted accounts of users who are critical of President Obama, but as far as I know nothing like this was done to users who were critical of Bush. It's clear that the Flickr team wanted to take this image down."
However, image copying and modification permissions can vary according to context. While creating a parody from an image might be permitted under fair use, copying that parody might not be.
And there's evidence some original rights holders aren't involved. Photo District News reported that Time and DC Comics both said they hadn't send Yahoo the DMCA notice, and that the office of the original Obama photographer, Platon, wasn't even aware of the controversy.
Hawk also quoted the DMCA notice Flickr sent Alkhateeb letter that identified the infringement complainant to be Edward Przydzia.
Yahoo hasn't detailed its rationale for removing the image, saying its privacy policy forbids it from discussing particulars of the situation. However, it did indicate politics were not involved.
"There appears to be a whole lot of makey uppey going in the news and blogosphere about this event," Champ said in a forum post. "We very much value freedom of speech and creativity...I'm not sure how complying with the law has led to the idea that we (the Flickr team) have a particular political agenda."
Is posting a phony, sexually suggestive ad online about another person free speech, an inappropriate prank, or a felony? That's what the Missouri court system will decide.
A cyberbullying case in Saint Charles County, Missouri, will test a year-old state law on electronic harassment. The law makes it a felony for someone 21 years or older to communicate with someone 17 years or younger by phone or electronic means in order to recklessly frighten, intimidate, or cause emotional distress to that person.
Elizabeth Thrasher, 40, allegedly posted a photo and personal contact details of a teenage girl in the Casual Encounters section of Craigslist during the spring. The teen reportedly received phone calls, e-mails, and text messages from strange men, prompting her to call the police.
Thrasher was then charged with the crime of cyberbullying under the statute 565-090, passed in Missouri in August 2008. Unofficially known as Megan's law, the statute is named after 13-year-old Megan Meier who committed suicide in 2006 after being the victim of an Internet hoax set up by a schoolmate's mother.
In the new case, CNET News recently spoke by phone with defense attorney Michael Kielty and Saint Charles County prosecutor Jack Banas.
The defense speaks
Hired to defend Thrasher, Michael Kielty finds fault with the law itself, pegging it as too vague. "It's a terribly crafted statute," he told CNET News. "I think ultimately it's going to be found unconstitutionally overly broad and vague."
Kielty's problems with the law rest partly on free speech issues. He said the statute states that if you cause somebody under 17 emotional duress via electronic communication, then you're a felon. "Can you imagine the application of that in everyday life?" he asked. "With your children? With teachers and students? It is a slippery slope."
The attorney also believes the case targets Internet speech specifically and that it wouldn't be a felony had it not occurred in cyberspace. "She was arrested and had to post bond for words. No actions, no threats. For words. There's something wrong with that. If it was a newspaper ad, it would not have been criminal. It certainly wouldn't have been a felony. If it was on a street corner or a bathroom wall, it wouldn't have been a felony."
Kielty also discussed the complicated back-story between the defendant and alleged victim. One of the client's daughters was dating the alleged victim's younger brother, he said. That led to a meeting between the ex-husband of the defendant and the alleged victim's mother, who apparently hit it off and moved in together soon after.
Conflict then started to surface between various family members, according to Kielty. The alleged victim's mother started making derogatory comments about the defendant's daughter, he said. Kielty claims there was harassment by the alleged victim and and her mother directed at the defendant.
"This didn't just happen in an isolated incident," he said. "There is context to the transaction. But my client never initiated contact with the victim. Your typical harassment statute would be a series of threatening or harassing statements, maybe some stalking, maybe threats of abuse or something of that nature. This is nothing of the sort."
This isn't Kielty's first encounter with Megan's law. In December, he defended a 21-year-old woman accused of sending harassing and threatening text messages to a 17-year-old girl in a dispute over a male.
The 21-year-old was charged under the same statute, but in this case it was a misdemeanor, not a felony. Kielty said she pleaded guilty to the misdemeanor and received probation. "But she was never arrested, and she never had to post bond," he said. "And I would argue that case was more egregious than (the Thrasher case) because as the facts came out at the plea, there were actual threats made."
Kielty acknowledges that Thrasher's action was improper and a mistake. "It wasn't thought out and it was not the appropriate thing to do. However, I don't think it raises to the level of a felony, much less a misdemeanor."
Kielty sees the law as a knee-jerk reaction on the part of local politicians to the Megan Meier case. All the media attention and public outcry over Meier's suicide led to the new statute, he believes. And now the prosecutor is in a position to enforce that statute.
An arraignment is set for Monday, in which Kielty will enter a plea of not guilty on behalf of his client. He expects the case will be set for either a disposition or preliminary hearing. The hearing would require the state to show probable cause that a crime was committed and that Thrasher was the person who committed it.
After that, the case would then travel to the circuit court, requiring another arraignment where Kielty would again enter a plea of not guilty. The case would then be set for trial, which the attorney believes could happen mid- to late spring of 2010.
If convicted, Thrasher might receive a penalty of up to four years in prison. "Up to four years in prison for a practical joke gone awry," said Kielty. "For words spoken through an Internet medium that would not be criminal if spoken on the corner of the street. I'm going to fight them every step of the way because I don't think it's a properly crafted statute. I believe that ultimately the statute will be overturned and should be."
The prosecution speaks
Saint Charles County prosecutor Jack Banas is charged with enforcing Megan's law. As opposed to Kielty, he said he believes the statute will stand up in court. "I think it's drawn narrowly enough to punish people only when they've done something intentional for the purpose of intimidating or frightening or causing someone emotional distress. I can only say that as it's written right now, we're enforcing it and will enforce it."
Banas doesn't believe the law singles out the Internet specifically other than that it's the vehicle used to commit the crime. He pointed out that Missouri harassment statutes are not just for electronic communications. "They're written for any type of communications done to frighten or intimidate or cause emotional distress," he explained, "whether the purpose is to harass somebody through the Internet, over the phone, or face to face."
This isn't a free speech issue according to Banas, but pure harassment. "Free speech does not involve speech directed at someone to intimidate, frighten, or otherwise harass them," he said. "That's not what free speech is about. This is directing something at a specific individual for the purpose of intimidating or frightening or causing emotional harm. It takes it out of the realm of some type of public speech."
Megan's law was passed to update Missouri's prior harassment statute, which Banas said was archaic because it only covered intimidation by writing or by phone. A large committee of prosecutors, defense attorneys, and a victim in another case worked with legislators to upgrade the statute for the modern world to cover electronic communications.
Banas explained that much time and effort have been spent educating people about the new law and the issue of harassment. Local newspapers and news stations have done stories on cybercrimes and the problems they've created.
Megan Meier's mother has also focused on public awareness. "Mrs. Meier had organized a nonprofit agency in which she went to schools to make parents and everyone else aware of this," said Banas. "There are bullying and cyberbullying classes. My wife is a teacher, and that's part of their curriculum."
"Whether or not the law was common knowledge, I think it was common knowledge that what she did was wrong," said Banas. "You're presumed to know what the crimes are in the state of Missouri."
The attorney explained that it's in an appeals process where the statute's constitutionality would be tested.
"If it goes to trial, and there's a verdict of guilty, then the defendant would have a right to appeal it. But I think this statute is very much within the constitutional boundaries. I think it should withstand the scrutiny of the appellate court."
