US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 1 1 2 3 4 5 6 7 U.S. COPYRIGHT OFFICE 8 SOFTWARE-ENABLED CONSUMER PRODUCTS STUDY 9 10 TUESDAY, MAY 24, 2016 11 9:01 a.m. 12 13 UC Hastings College of the Law, 14 Alumni Reception Center, 15 200 McAllister Street, 16 San Francisco, California 94102 17 18 19 Reported by: Capital Reporting Company 20 21 22 23 24 25 www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 2 1 A P P E A R A N C E S 2 ASHLEY AILSWORTH, Specialty Equipment Market 3 Association 4 ERIK BERTIN, United States Copyright Office 5 EVAN COX, BSA | The Software Alliance 6 SY DAMLE, United States Copyright Office 7 CATHY GELLIS, Digital Age Defense 8 STEPHEN LIU, Juelsgaard IP & Innovation Clinic / 9 Engine Advocacy 10 SAM MCCLURE, Juelsgaard IP & Innovation Clinic / 11 Engine Advocacy 12 JOHN R. RILEY, United States Copyright Office 13 CATHERINE ROWLAND, United States Copyright Office 14 BEN SHEFFNER, Motion Picture Association of 15 America, Inc. 16 ANDREW SHORE, Owners' Rights Initiative 17 ERICA SOLLAZZO, Juelsgaard IP & Innovation Clinic/ 18 Engine Advocacy 19 KIT WALSH, EFF 20 KYLE WIENS, iFixit 21 22 23 24 25 www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 3 1 C O N T E N T S 2 AGENDA PAGE 3 Session 1: 4 The Proper Role of Copyright in Protecting 5 Software-Enabled Consumer Products 6 6 7 Session 2: 8 Ownership and Contractual Issues 66 9 10 Session 3: 11 Fair Use 146 12 13 Session 4: 14 The First-Sale Doctrine, Section 15 and Other Limitations and Exceptions 182 16 17 Observer Comments 212 18 19 20 21 22 23 24 25 www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 4 1 P R O C E E D I N G S 2 MR. DAMLE: Okay. Good morning, everyone, 3 and welcome to the second roundtable hearing on 4 the topic of copyright law as it relates to 5 software-enabled consumer products. 6 I'm Sy Damle. I'm Deputy General Counsel 7 at the U.S. Copyright Office, and I'll let my 8 colleagues introduce themselves. 9 MR. RILEY: My name is John Riley. I'm an 10 Attorney-Advisor. 11 MS. ROWLAND: I'm Catie Rowland, Senior 12 Advisor to the Register. 13 MR. BERTIN: I'm Erik Bertin. I'm the 14 Deputy Director of the Registration Program. 15 MR. DAMLE: Great. So first of all, I'd 16 like to thank the UC Hastings College of the Law 17 for hosting us. I don't know if there are any 18 representatives from -- no? Well anyways, for the 19 record, I will note that David Faigman, Professor 20 Depoorter, Lan Tran, Tom McCarthy and the Media 21 Services Group and the ITS group have been very 22 helpful in getting this set up for us. And so, we 23 appreciate their hospitality. 24 So we're conducting this study at the 25 request of the Senate Judiciary Committee, as you www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 5 1 all know. The Committee's letter observed that the 2 revolutionary nature of digital technologies has 3 led to software being essential to the operation 4 of refrigerators, cars, farm equipment and 5 wireless phones. 6 While acknowledging the role of 7 intellectual property laws in that development, 8 the Committee noted that there are questions being 9 asked about how consumers can lawfully use 10 products that rely on software to function. And 11 so, the topic today is to sort of explore those 12 questions and see whether Congress or the Office 13 needs to act in some way to solve any problems. 14 So, just a couple of housekeeping matters 15 before we begin, some of you are veterans of our 16 roundtables. So you know this. But for the others, 17 if you want to jump in on the conversation, just 18 take your table tent that's in front of you and 19 just tip it sideways so that way we know to call 20 on you if you want to jump in. 21 And just a disclaimer that your remarks 22 are being recorded and will be transcribed and 23 made part of the public record. And the panel is 24 being live-streamed, I believe. So there's that as 25 well. www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 6 1 We've got four panels lined up for today. 2 There are three before lunch and one after lunch. 3 And there will be an opportunity for any observer 4 comments at the end. We had a very productive 5 conversation in Washington, D.C., and so, I hope 6 we have a similarly productive conversation today. 7 Our first panel is about a fairly general 8 topic, which is about the proper role of copyright 9 in protecting software-enabled consumer products. 10 The goal is to explore overarching issues like the 11 need for copyright protection for embedded 12 software, whether software in everyday products 13 can be distinguished from other types of software 14 and the need for interoperability. 15 Oh, and one thing about the microphones - 16 - the microphones are on all the time. So, during 17 the conversation, if we can try to limit sort of 18 cross-talk, for the Court Reporter's sake mostly, 19 that would be very helpful. 20 Before I start off, we'd appreciate it if 21 each of you could introduce yourselves and explain 22 your affiliation for the record. Why don't we 23 start over here with you? 24 MS. AILSWORTH: Hi. I'm Ashley Ailsworth, 25 from the Specialty Equipment Market Association, www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 7 1 SEMA, and we represent the manufacturers, 2 installers, retailers of specialty equipment 3 automotive parts, specifically aftermarket parts 4 that are unique and not necessarily replacement 5 parts or direct replacement parts. 6 MR. COX: Hi. I'm Evan Cox. I'm an 7 attorney at Covington & Burling here in San 8 Francisco, and I'm here on behalf of the Business 9 Software Alliance. The Business Software Alliance 10 is the leading advocate for global software 11 industry in the United States and around the world 12 and is very involved in public policy and I've 13 worked with them for about 20 years. 14 MR. DAMLE: Thanks. 15 MR. SHORE: Andrew Shore. I'm a partner 16 with Jochum Shore & Trossevin. I run a coalition 17 called the Owners' Rights Initiative. Groups like 18 eBay, Goodwill, the American Library Association, 19 who all rely on primarily the first-sale doctrine 20 to advance their businesses. 21 MS. GELLIS: I'm Cathy Gellis. I'm an 22 attorney in private practice. I participated in 23 the study, filing a written comment on behalf of 24 the R Street Institute. I'm not representing them 25 today, although I may happen to say very similar www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 8 1 things. 2 MR. MCCLURE: Hi. I'm Sam McClure. I'm 3 from the Stanford IP Clinic, representing Engine 4 Advocacy, which is a policy organization that 5 supports the growth of technology entrepreneurship 6 through economic research, policy analysis and 7 advocacy on local and national levels. 8 MR. WIENS: Hi. I'm Kyle Wiens. I 9 represent iFixit and Repair.org, and we represent 10 consumers that are trying to fix their things and 11 professional repair technicians that are repairing 12 everything from medical equipment to automotive 13 vehicles to cell phones and a broad spectrum of 14 electronic devices. 15 MS. WALSH: Kit Walsh, a staff attorney 16 with the Electronic Frontier Foundation. We're a 17 nonprofit digital civil liberties organization 18 with over 26,000 dues-paying members. We work to 19 promote civil liberties, freedom of speech and 20 innovation in the digital age. 21 MR. DAMLE: Great. Thank you all. So, to 22 start things off, the Committee asked us to 23 examine the specific issue of copyright related to 24 software in what they called “everyday products.” 25 And so, we understand the committee to have not www.CapitalReportingCompany.com (202) 857-3376 US Copyright Office Software-Enabled Consumer Products Study May 24, 2016 Page 9 1 asked us for a more comprehensive review of 2 copyright in software generally. 3 With that understanding, one of the 4 really key questions here is whether there are6 5 problems in the marketplace that are specific to 7 6 software-enabled consumer devices separate and 7 apart from software generally, and, if so, whether 8 those problems can be solved without affecting 9 copyright protection for software generally. 10 So if anyone wants to jump in and sort of 11 discuss that kind of general issue? 12 MR. SHORE: Sure. 13 MR. DAMLE: Mr. Shore? 14 MR. SHORE: Yeah. So I guess my first 15 comment would be to sort of reject the notion of 16 consumer versus business products because what 17 does “consumer” mean? Is it the product or is it 18 the setting in which it exists? You mentioned 19 refrigerators.