IP: WIPO Database Proposal - PTO To Accept Email Comments (fwd)

[Dave Farber <farber () cis upenn edu>]

Date: Thu, 31 Oct 1996 20:24:41 -0500 (EST)
From: James Love <love () tap org>


INFORMATION POLICY NOTES
October 29, 1996


              A Primer On The Proposed WIPO Treaty On 
                    Database Extraction Rights 
             That Will Be Considered In December 1996*


                        October 29, 1996


                            James Love
                  Consumer Project on Technology
                  http://www.essential.org/cpt
                         email: love () tap org


   *HTML version at http://www.essential.org/cpt/ip/cpt-dbcom.html
    Ascii version formatted with 11 pt courier with 1 inch margins.
    This is my first take on the treaty, and I would appreciate
    comments and corrections.  This is a very important matter that 
    hasn't received much attention. jl 




        INTRODUCTION


The World Intellectual Property Organization (WIPO) will 
consider in December 1996 a new treaty that would require most 
countries (including the United States) to severely curtail the 
public's rights to use pubic domain materials stored in "databases."  
Some experts say it is the "least balanced and most potentially anti-
competitive intellectual property rights ever created."  The U.S. 
Patent and Trademark Office (PTO) is accepting public comments on 
this treaty, and a digital copyright treaty that is also troubling.  
Comments are due by November 22, 1996, and can be submitted by 
electronic mail to: diploconf () uspto gov.  Copies of the treaty, 
commentary, and the PTO federal register notice is available from 
http://www.public-domain.org.  This memorandum provides background 
information on the treaty and the problems it presents.




BACKGROUND


The database treaty is being pushed by large publishing 
companies, in response to the 1991 U.S. Supreme Court decision in 
Feist Publications, Inc. v. Rural Telephone Service, 
[http://www.law.cornell.edu/supct/classics/499_340v.htm].  In Feist, 
the Court rejected a claim of copyright for data from a telephone 
directory's white pages, saying that facts cannot be copyrighted, and 
that obvious items such as listing names, addresses, and telephone 
numbers in alphabetical order, are not sufficiently creative to 
qualify for copyright protection.  The decision rejected the "sweat 
of the brow" theory of copyright.


Compilations of data or documents, including materials from the 
public domain, can receive protection under copyright if the creator 
of the compilation can show originality in the selection and 
arrangement of the data.  Comprehensive databases, which can be 
expensive to create,  confront problems under copyright laws because 
(almost by definition) they are not original in terms of the 
selection of the materials.  


Electronic database publishers have sought to protect their data 
through contracts with their customers.  These contracts often place 
restrictive conditions on the reuse or redissemination of the data.  
See Pam Samuelson, "Legally Speaking: Legal Protection For Database 
Contents," 39 Communications of the ACM (Nov. 1996), 
http://ksgwww.harvard.edu/iip/datacon.html, for a discussion about 
this approach.  In other cases, database vendors permit online 
searching, but do not distribute the complete database itself.


Publishers are looking for stronger protection, and are lobbying 
hard to obtain a new "sui generis" (this is Latin for "one of a 
kind," and is a term used to describe statutory protections which are 
not defined under patent, copyright or trademark laws) property right 
to protect the contents of databases.  The publishers' first success 
was the adoption of a controversial proposal for database extraction 
rights in the European Union (EU), and by gaining the support of the 
Clinton Administration and the EU to propose a very similar measure 
as an amendment to the Berne Copyright Convention.  The Clinton 
Administration also supported domestic legislation to implement this 
form of data use regulation in the 104th Congress [HR 3531], but 
there were no hearings on the measure.  


Despite the controversial and far reaching nature of the 
database protection proposal and the lack of discussion on its impact 
in the United States, the Clinton Administration is asking for quick 
approval of the database treaty at a December 1996 meeting in Geneva 
hosted by the World Intellectual Property Organization (WIPO).  The 
main Administration advocate in support of the publishers' position 
is Bruce Lehman, Chair of the Patent and Trademark Office (PTO), a 
person widely considered an intellectual property rights zealot.


THE COMPLEXITIES (AND DANGERS) IN CREATING A NEW PROPERTY RIGHT 
FOR DATA


While many persons are sympathetic to the general idea of a sui 
generis form of protection for databases, there is enormous concern 
about the complexities of creating a new property right that has the 
potential to create private monopolies on data and documents that 
have traditionally been in the public domain. It is often said that 
"the devil is in the details," and this is certainly true for the 
database protection proposal.  A handful of database vendors have 
quietly crafted a proposed treaty and law that creates a nightmare 
for researchers and value added publishers.  In discussing the 
development of the EU database proposal,  J. H. Reichman and Pamela 
Samuelson say that "lobbying pressures converted the final version 
into one of the least balanced and most potentially anti-competitive 
intellectual property rights ever created."  [Intellectual Property 
Rights In Data: An Assault On The Worldwide Public Interest In 
Research And Development, forthcoming in Vanderbilt Law Review, 50, 
on the Web at http://ksgwww.harvard.edu/iip/reisamda.html].  


The database vendors have sought to vastly expand the ability of 
database owners to regulate and restrict the public's rights to use 
data, without the types of safeguards which exist in copyright law 
today.  In this respect, it is important to understand that as a "sui 
generis" property right, the database extraction rights are not part 
of the of the copyright regime, and the entire doctrine of fair use 
of data will not apply to data protected under the proposed database 
extraction rights treaty and legislation.  Moreover, under the WIPO 
proposal these new  data rights would be retroactive, affecting 
countless databases already in existence.  


        DIGRESSION ON WEST PUBLISHING AND THE DEFINITION OF A DATABASE


The Feist decision was particularly troubling for West 
Publishing, a company that wants to maintain its monopoly on the 
citations and corrected text for many court decisions.  
[http://essential.org/cpt/legalinfo/legalinfo.html]  West is the only 
comprehensive publisher of federal circuit and district court 
opinions and state court opinions from all 50 states.  The page 
numbers of the West court reporters are the basis for authoritative 
citations used by scholars and lawyers.  As a reporter of decisions, 
West also makes corrections to the text of court opinions, typically 
after working with the judge who wrote the opinion.  West wants to 
prevent others from using their page numbers or the corrected text of 
court opinions, and it is often in court trying to prevent its would 
be competitors from doing so.


West is now involved in at least two law suits over its 
assertions of copyright of the page numbers, and one law suit over 
the issue of the copyright to the text of the corrected court 
opinions.  [See http://www.hyperlaw.com for background on this].  
Most copyright experts think that West will lose its court case on 
the issue of its page numbers, and West will also be hard pressed to 
claim it can copyright the corrections to the text of court opinions 
-- particularly for the US federal courts, since U.S. copyright laws 
exclude the works of federal employees.  


Most people think that the corrected text of court opinions, and 
the citations to those opinions, should be in the public domain, and 
that the West monopoly has delayed the development of new information 
products and services for legal researchers.  No one seriously argues 
that the court opinions would not be published without a West 
monopoly.  West is among the private sector publishers who have 
successfully lobbied the EU and the Clinton Administration to extend 
the database protection proposals to print products by defining a 
database so broadly that it will include any collection of facts, 
data, or documents regardless of the media. If the database 
protection proposals are enacted, West will have a firm monopoly on 
decades of judicial citations and corrections to judicial opinions.


        THE DATABASE EXTRACTION RIGHTS PROPOSAL 


The August 30, 1996 version of the WIPO treaty is available on 
the Web at http://www.loc.gov/copyright/wipo6.html, and it is worth 
reading since it represents the most radical change in intellectual 
property rights in data, ever.


        WHAT IS A DATABASE?  WHAT ISN'T A DATABASE?


The treaty would protect "any database that represents a 
substantial investment in the collection, assembly, verification, 
organization or presentation of the contents of the database."  This 
term should be understood "to include collections of literary, 
musical or audiovisual works or any other kind of works, or 
collections of other materials such as texts, sounds, images, 
numbers, facts, or data representing any other matter or substance" 
and "may contain collections of expressions of folklore."   The 
"protection shall be granted to databases irrespective of the form or 
medium in which they are embodied. Protection extends to databases in 
both electronic and non-electronic form" and "embraces all forms or 
media now known or later developed. . . Protection shall be granted 
to databases regardless of whether they are made available to the 
public.  This means that databases that are made generally available 
to the public, commercially or otherwise, as well as databases that 
remain within the exclusive possession and control of their 
developers enjoy protection on the same footing."


In other words, a lot of water will go under this bridge.  


        WHAT ARE EXTRACTION AND UTILIZATION RIGHTS?


"The maker of a database eligible for protection under this 
Treaty shall have the right to authorize or prohibit the extraction 
or utilization of its contents."  What is "extraction"?  Extraction 
is defined as, "the permanent or temporary transfer of all or a 
substantial part of the contents of a database to another medium by 
any means or in any form."  "Extraction . . . is a synonym for 
`copying' or `reproduction' . . . by  `any means' or `any form' that 
is now known or later developed."


"Utilization" is defined as "making available to the public all 
or a substantial part of the contents of a database by any means, 
including by the distribution of copies, by renting, or by on-line or 
other forms of transmission," including the right to control the use 
of the data "at a time individually chosen by each member of the 
public."




      WHAT IS A "SUBSTANTIAL PART" OF THE DATABASE?


The treaty sets out tests for determining if an extraction is 
"substantial,"  and these tests are both highly anticompetitive, and 
extremely broad in scope. 


The  "substantiality" of a portion of the database is assessed 
against the "value of the database,"  and considers "qualitative and 
quantitative aspects," noting that "neither aspect is more important 
than the other. . . This assessment may also take into account the 
diminution in market value that may result from the use of the 
portion, including the added risk that the investment in the database 
will not be recoverable. It may even include an assessment of whether 
a new product using the portion could serve as a commercial 
substitute for the original, diminishing the market for the 
original."


Then the treaty adds that a "substantial part" means any portion 
of the database, "including an accumulation of small portions . . . 
In practice, repeated or systematic use of small portions of the 
contents of a database may have the same effect as extraction or 
utilization of a large, or substantial, part of the contents of the 
database."


In the US implementing legislation, the only types of data use 
that would not be regulated would be "insubstantial" parts, "whose 
extraction, use or reuse does not diminish the value of the database, 
conflict with a normal exploitation of the database or adversely 
affect the actual or potential market for the database."  Under this 
language, a database owner could say that it might in the future want 
to charge for each transmission of a fact or an element of a database 
as part of its "normal exploitation" of the database.  With the 
Internet and digital cash this claim is likely to be made.  The 
public would not have "fair use" rights, since fair use is only 
defined in matters involving copyright.


        FOR HOW LONG?  15 YEARS, 25 YEARS, OR FOREVER?


The Treaty would require a minimum term of protection (15 years 
in the EU proposal, and 25 in the United States proposal) for the 
database.  But this is extended each time the database is revised or 
enhanced.  According to the draft treaty, "any substantial change to 
the database, evaluated qualitatively or quantitatively, including 
any substantial change resulting from the accumulation of successive 
additions, deletions, verifications, modifications in organization or 
presentation, or other alterations, which constitute a new 
substantial investment, shall qualify the database resulting from 
such investment for its own term of protection."


The provision on revisions raises the specter that protection 
for many databases will be perpetual.  This could indeed be the case 
if the original versions of the database are only "licensed" by the 
vendor for a limited period of time, so that the only available 
versions would be the new ones, which would have a new term of 
protection.  [Database vendors write these restricted use licenses 
now].


        WHO WILL "OWN"  FACTS?


The supporters of the Treaty note that persons can independently 
collect data for a rival database, and the US legislation says 
"nothing in this Act shall in any way restrict any person from 
independently collecting, assembling or compiling works, data or 
materials from sources other than a database subject to this Act."  
Unfortunately, this will only be helpful in those cases where there 
will be a separate non-protected source for the data or documents.


If the entity which creates the initial data or documents 
qualifies for the database extraction right, the data itself will be 
monopolized.  The example given above regarding the West Publishing 
reporters of court decisions is one example, where the citations 
(which are based upon the West page numbers) and the corrections to 
opinions (which are only reported by West) cannot be obtained from 
any third parties. But the problem is much broader than court 
opinions.  All sorts of data will be protected at the source under 
the database treaty, and may never enter the public domain.


There are also the practical problems relating to the costs of 
independent data collection.  The telephone companies obtain 
directory information when you become a subscriber, and it is 
practically impossible to independently collect this data.  Databases 
of IP addressees collected by Network Solutions will be covered, 
giving Network Solutions broad new rights in how that data is 
utilized by ISPs.  


        WHAT ABOUT GOVERNMENT INFORMATION?


Much of the lobbying for the sui generis database proposal is 
designed to enable database vendors to protect collections of 
government documents.  The treaty would permit countries to have 
special rules for "databases made by governmental entities or their 
agents or employees."  However, this exemption will not include cases 
such as the West Publishing reporting of court decisions, where West 
is acting as an unofficial agent for the courts.


In the US enabling legislation, protection is not given to a 
database made by a governmental entity, but protection could not be 
excluded from companies if a database's "contents have been obtained 
from a governmental entity."  There is no provision to exempt 
databases created by private parties; like West, LEXIS, and literally 
thousands of other firms; when they act as contractors to government 
agencies.  For example, West is a contractor for some courts in 
receiving electronic filing of briefs.  Under the U.S. legislation, 
the database of briefs collected by West for the Courts would be 
protected.  Likewise, the SEC EDGAR public disclosure filings which 
are managed by LEXIS would be covered.


The Clinton Administration has gone to court in at least two 
cases avoid releasing documents under the Freedom of Information Act 
(FOIA) when West Publishing has asserted intellectual property rights 
claims to elements of the data.  In the FLITE case, the Clinton 
administration successfully argued that it did not have to release 
U.S. Court opinions collected by the Air Force at public expense that 
contained West "corrections" and enhancements.  (See: 
http://www.essential.org/listproc/info-policy-notes/0185.html, and 
the Tax Analysts page on this topic, at http://www.tax.org/pal). It 
appears as though government entities will be permitted to avoid FOIA 
completely if they use private contractors, and write contracts which 
permit agency access to data (extraction), but do not permit 
disclosure to the public.  [For a discussion of an earlier 
legislative initiative by West Publishing to achieve a similar 
result, that was defeated after citizen protests, see: 
http://www.essential.org/listproc/info-policy-notes/0137.html, and 
http://www.essential.org/listproc/info-policy-notes/0139.html]


      WHAT ABOUT FAIR USE RIGHTS?


As noted several times, the public has rights, often taken for 
granted, under the copyright "fair use" doctrine.  This includes 
commercial and non-commercial fair use.  The fair use rules involve 
public interest balancing tests.  The sui generis database proposal 
doesn't include or incorporate public fair use rights.  It is 
difficult to know how this will play out in practice.  


Under the treaty language, governments "may, in their national 
legislation, provide exceptions to or limitations of the rights 
provided in this Treaty in certain special cases that do not conflict 
with the normal exploitation of the database and do not unreasonably  
prejudice the legitimate interests of the rightholder."  The key 
terms here are "normal exploitation of the database," and "legitimate 
interests" of the rightholder.


In the U.S. legislation, "a lawful user of a database made 
available to the public or placed in commercial use is not prohibited 
from extracting, using or reusing insubstantial parts of its 
contents, qualitatively or quantitatively, for any purposes 
whatsoever."  But as noted earlier, the term "insubstantial" is 
constrained by the scope of the business opportunities that are 
perceived by the database vendor.  Not only is "insubstantial" 
limited to those uses which do not diminish the value of the 
database, but insubstantial must also not "conflict with a normal 
exploitation" of the database, or adversely impact the "actual or 
potential" market of the database.  Moreover, the "normal 
exploitation" of the database seems to be defined in such a way that 
the vendor can assert that a transmission of a database element on 
the Internet would be an infringement if the company has a mechanism 
or even aspirations to charge for the information, and the cumulative 
impact of many small transactions would diminish the value of that 
service.


        RETROACTIVE PROTECTION


The treaty would require countries to provide protection 
prospectively for databases already on the market.  Countries could 
exempt older databases from protection for up to two years.


        PROHIBITIONS ON TECHNOLOGIES TO DEFEAT PROTECTION


As in the proposed Internet copyright treaty and legislation, 
the database proposal is accompanied by very strict prohibitions 
against the "importation, manufacture or distribution of protection-
defeating devices."  This is defined as "any device, product or 
component incorporated into a device or product, the primary purpose 
or primary effect of which is to circumvent any process, treatment, 
mechanism or system that prevents or inhibits any of the acts covered 
by the rights under this Treaty."  The US legislation contains 
similar provisions, plus a whole section which would make it a 
federal crime to interfere with "database management information."  
Persons would face up to 5 years in jail and a $500,000 file for 
doing such things as providing or disseminating false database 
management information, or removing or altering any such information.   
It would seem that simply tearing the cover off a telephone book (a 
protected database under the treaty) be a violation of this 
provision.


        WHAT CAN YOU DO?


If you think this proposal needs more debate before it is forced 
upon us and the rest of the world, contact your member of Congress 
and submit comments to the PTO asking that the database treaty be 
taken off the WIPO agenda for this December.  You should point out 
that there have been zero public hearings before the Congress on this 
far-reaching proposal.  You also might read the attached October 9, 
1996 letter in opposition to the treaty by the Presidents of the 
National Academy of Sciences, the National Academy of Engineering, 
and the Institute of Medicine. You will also find good background 
materials at Brian Kahin's web page for the State Department Advisory 
Committee on International Communications and Information Policy at: 
http://ksgwww.harvard.edu/iip/intellec.html.


As noted above, you can send comments by electronic mail to: 
diploconf () uspto gov.  They must be in by November 22, 1996.  Copies 
of the treaty, commentary, and the PTO federal register notice is 
available from http://www.public-domain.org.  Public-Domain is an 
independent citizen's organization being formed to fight this treaty, 
and more generally to protect the public domain in matters concerning 
intellectual property.  


    James love
    love () tap org
    http://www.essential.org/cpt


---------------------------------------------------------------------
                            APPENDIX


Letters of Presidents of National Academy of Sciences, National 
Academy of Engineering, and Institute of Medicine in opposition to 
the database treaty.




October 9, 1996
The Honorable Michael Kantor 
Secretary of Commerce 
Department of Commerce
14th Street and Constitution Avenue
NW Washington, D.C. 20230


Dear Mr. Kantor:


We are writing to express our serious concern about pending changes 
to international and domestic intellectual property law that are 
being supported by the Department of Commerce. Although we understand 
that the wide availability and easy transmittal of digital databases 
can present difficulties for database vendors, we believe that the 
August 30, 1996 Draft Treaty on Intellectual Property in Respect to 
Databases, which was prepared under the World Intellectual Property 
Organization (WIPO), has the potential to undermine our nations 
progress in scientific and technical research and education if 
appropriate exceptions and limitations are not clearly articulated. 
As you may know, the proposed WIPO treaty contains major provisions, 
intended to do the following.


Prohibit unauthorized extraction, use, or reuse of any database, or 
any substantial portion of a database (as defined by the database 
vendor), and effectively establish the basis for a pay-per-use 
system; - Make perpetual protection the norm for databases, by making 
a 15-year initial term of protection renewable with every substantial 
change or addition to a database, actions that occur frequently with 
most electronic databases; - Apply to all privately generated data, 
or repackaged U.S. government data (outside the United States, 
government databases would be protected by this law as well); and - 
Include strong civil and criminal penalties, including provisions for 
third-party liability (e.g., liability incurred by the unwitting 
intermediary or disseminator).


While we certainly do not dispute the right of database compilers and 
vendors to obtain reasonable protection of their products, the 
proposed law fails to provide for any public-good exceptions, such as 
the fair use exemption traditionally enjoyed by the research and 
education communities for their limited use of copyrighted works. 
Database publishers would effectively obtain an absolute and 
perpetual monopoly in their data compilations, including preexisting 
data sets. The proposed changes would significantly inhibit 
researchers seeking to reuse and combine data for publication or for 
research (an especially acute problem for researchers using large, 
continuously updated observational data sets), as well as educators 
wishing to use portions of data sets for instructional purposes. The 
new law also would overturn a series of Supreme Court cases that 
limit intellectual property rights in the interest of free 
competition. 


We believe that these changes to the intellectual property law, if 
enacted in their present form, would seriously undermine the ability 
of researchers and educators to access and use scientific data, and 
would have a deleterious long-term impact on our nations research 
capabilities. Moreover, the proposed changes are broadly antithetical 
to the principle of full and open exchange of scientific data 
espoused by the U.S. government and academic science communities, and 
promoted internationally. We are aware that these and additional 
concerns regarding changes to the intellectual property law, have 
been communicated to the President and Vice President by the Digital 
Future Coalition, the American Society for Information Systems, the 
Association of Research Libraries, and the American Association of 
Universities.


What is especially disconcerting is that these radical legal changes 
have been proposed by the Department of Commerce for formal 
discussion and negotiation at the WIPO Diplomatic Conference this 
December, without any debate or analysis of the laws potentially 
harmful implications for our nations scientific and technological 
development. Indeed, although the unintended consequences appear very 
grave to those studying these issues, very few individuals at the 
science agencies or in the academic community appear even to be aware 
that such changes are about to take place, nor has there been any 
effort made to solicit their views.


If the current Draft Treaty on Intellectual Property in Respect of 
Databases is adopted by WIPO, these changes will move substantially 
toward becoming the new international norm in intellectual property 
law by the end of this year. Therefore, we request that no 
precipitous action be taken at the planned WIPO Diplomatic Conference 
before the range of consequences of the proposed changes is fully 
understood and appropriate modifications are made.


The underlying issues that have given rise to the potential changes 
in intellectual property law will also be described in a report to be 
published by the National Research Council later this fall. The study 
committee that prepared that report plans to hold a one-day symposium 
at the National Academy of Sciences to explore these issues in 
greater detail with key officials from the Administration and 
Congress. In the meantime, we hope that you will take the steps 
necessary to avert what could otherwise become an unnecessarily 
damaging and contentious development in intellectual property law.


Sincerely,


Bruce Alberts, National Academy of Sciences 
Wm. A. Wulf , National Academy of Engineering
Kenneth I. Shine, Institute of Medicine 




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