In this session of our module on DMCA and software and related issues, we're going to give you some examples of DMCA and let you see how it might apply or not apply. The first example we're going to talk about is a question I often get in class, which is, can I crack a trial version of software and modify it or distribute it? Now this is an interesting question because first sale rights it says I can modify software. I can modify software to make it easier to use or I can do a backup. And it also says that I can resell it to one other person. Now I can't make lots of copies and distribute it broadly, because that's a violation of reproduction rights. But I could modify my version of a software program and resell that version which I legally own, I bought a copy, to someone else. Just like I can resell a book or a magazine, I can also resell software. But the problem comes in with the crack. Can I crack a trial version? Meaning find a way, enter a code, do something to get around the restrictions of the software. That you cannot do under DMCA, because you're getting around the restrictions under a digital rights management system, DRM or getting around some form of an encryption, which is designed to stop you from doing that very thing you want to do. Turn a trial version into a more full-fledged version. It's DMCA that stops you. It's not copyright law per say. Not the traditional copyright law that stops you. It's DMCA which says you can't get around digital rights management. You can't get around encryption. Because that is just against the law. Even if you say, well maybe it's fair use. Maybe I'm using it for academic purposes. Maybe I'm just using it for a research, doesn't matter. DMCA doesn't have the same kinds of exceptions in general, or at least not as strong exceptions as traditional copyright law. And so you would be found guilty of violating DMCA for the cracking of the trial version of the software, even if you just sold that one copy. So the answer is no, you can't crack it. You might be able to modify and distribute it as long as you don't have to go around any kind of copy protection or digital rights management system. The second question is a company developed an emulator for Playstation games on the Mac. This emulator will allow you to run applications developed for the Playstation on your Macintosh computer. It's kind of a little bit of a waste to use an expensive computer to play games you could have played on a Playstation, but maybe you want to play it on the go, or in places or environments or contexts where you don't have a Playstation available and you enjoy this application, so you say great. Nice app, I'll buy it and use Playstation games on the Macintosh. Well, the problem here comes in with the Playstation or Sony saying no, you can't do that because in order to emulate the Playstation, you had to crack or circumvent certain kinds of protections or encryption to figure out how to emulate it, to even figure out how it worked. And therefore, you violated DMCA. Now this was an interesting one because the Playstation Emulator lost in court. And so the courts said no, you can't do this. And they appealed to a higher judge. And eventually after several years, the higher judge, the higher court said this looks like an example of a fair use that should be reasonable. Now the lower court said fair use did not apply to DMCA. The higher court said in this case maybe it does. That's a little unusual, because fair use is not clearly part of DMCA. But it was extended in this case to a DMCA context. Since DMCA is extension of US copyright or augmentation of US copyright. It's not part of global copyright, but it is in the US something ostensibly augmented copyright. So the judge said it's okay. But during the several years it took for this case to go to trial, the Playstation emulator could not sell it. They were barred from selling it while the trial was going on. because they had lost in the first court, so the judge said that you can't sell it, period. I think you're illegal. They appealed, we say we disagree with the judge, went to a higher court but it took time to get there. By the time the case was ruled in favor of the company making the emulator. The Playstation was now obsolete, so they won but they lost. They lost the market, they lost the time. They were barred from selling for several years. During that time, Playstation new generation came out, new software and the company went basically bankrupt. The legal fees and the inability to sell over several years of time had drained the company of all of its reserves and all there they won in court, they lost in terms of being bankrupt and unable to continue in business. So even if you win, you might still lose. If it drains so much money out of your company and so much ability to sell. This is not the only example of a company who has won. But the cost of the trial, the cost of the court and the length it has caused them to go out of business. How are DMCA and software related? It might be an issue you're thinking in your mind, because in this week we're talking about both. Well both are digital or related to digital goods and digital issues under copyright, which makes them in some ways related and both are relatively newer laws. Software being something that originally was not covered by copyright and then we needed new treaties and new laws to allow software to be copyrighted, DMCA an extension of law coming even after software. So both relatively new, and both are complicated. Software has it's own unique complications in DMCA, although only US law clearly quite complicated. DMCA can protect software and so they are related and sometimes their applications are commercial issues. As well as DMCA also protects music, movies, and other types of copyright content. How are they different? Well DMCA is US law only. Software law is part of global copyright law. Paris Accords, Uruguay Treaties have all reached agreements between many, many nations that say we should protect software under copyright. So software is very broad in its global application and protections. DMCA is not. Nobody else agrees with DMCA. This is the US only. A few countries have passed something a little bit like DMCA starting to move in that direction, but it's mostly US standing alone on this issue and certainly no one has adopted the full aspects of DMCA in any other country. They may have taken a part of that or some ideas from it, but DMCA is not part of treaties, not part of international agreements. Software is. DMCA also creates criminal liability, software violations are usually civil. I say usually because some countries may have criminal liability for software violations. For example Hong Kong has criminal law violations for using software that is not legal, licensed, or authorized in any business. They say you can use it in your home just fine, you can be sued for a civil offense. But it's not criminal to use a downloaded software program in your home. It is criminal to use it in business. And so that's a way of saying we're tough on intellectual property theft, particularly by those most likely to be sued, which are those people with money who are people in business doing business. The claims of violations are also different between DMCA and software. The arguments you use in court, the claims for monetary damages are not the same under the two laws. And so there are a number of differences between DMCA and software law. But there are clearly, as I've mentioned ,some similarities. That's it. Thank you very much. We'll see you in our next session. [MUSIC]
