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Susan Crawford examines one of the interesting quirks in the recently-passed Family Entertainment Copyright Act. Section 106 of the Copyright Act grants copyright holders an exclusive right “to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending”. This has universally been understood as an exclusive right to the distribution of physical copies — a right that terminates when each copy is first sold to the general public, under section 109.

But the FECA includes new criminal penalties for infringement of the distribution right with regard to a prerelease work “by making it available on a computer network accessible to members of the public”. Are they referring to infringements of the 106(3) distribution right? That would be a bit odd, since “making available” on a computer network does not necessarily involve “sale or other transfer of ownership, or by rental, lease, or lending”. It involves no transfer of a possessory interest in any particular physical object at all.

Now, perhaps courts will place a gloss on the section 106 language, holding that the distribution right was really meant to control all acts constituting publication, even the making of a copy by means of a transmission. But that’s barely a plausible meaning of the words in the statute, and I think a court could just as easily find that the new law is a nullity if it controls only acts infringing 106(3) rights. It’s impossible, I would argue, to violate an exclusive right to “sale or other transfer of ownership, or by rental, lease, or lending” by offering a download over a computer network.

But “distribution” isn’t a term defined in the Copyright Act, and I suspect that the drafters of this legislation mean the term in its everyday sense, not in its 106(3) sense. The best argument for the other side would be that 106(3) defines an infringing subclass of all possible acts of distribution, and that FECA criminalizes any act of distribution of prerelease works over computer networks, even if the act infringes the exclusive right of reproduction or public performance and not the exclusive right of distribution.

It will be interesting to see whether this issue comes up when the first FECA case comes around.

UPDATE: Via John Palfrey comes a link to a blog entry on this issue by Cathy Kirkman of Wilson Sonsini, who writes the Silicon Valley Media Law Blog. She notes that FECA might affect the scope of the distribution right, and points to the ongoing litigation against Hummer Winblad, the original VC backers of Napster.

She points out that in litigating the question of whether “making available” on Napster constituted infringement, both sides refer to the Hotaling case. In that case, the Fourth Circuit held that placing an unauthorized copy of a work on a library’s shelves and in its card catalog constituted an infringing act of distribution. But Hotaling is clearly distinguishable from an online-downlading scenario for one critical reason: the library in Hotaling was offering to lend physical copies. “Lending” is within the scope of 106(3); “copying”, “transmitting”, and “uploading” are not. In the ongoing Napster litigation, as in the FECA context, the 106(3) exclusive right should be limited to physical distribution of preexisting physical copies.