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Copyright © 1998 Richard A. Epstein. I have concluded that the importance of these views to the ongoing public policy debate and the noncommercial nature of this web site justify the reprinting of this editorial as a fair use under copyright law. Please do not copy for any purpose other than a fair or otherwise noninfringing use without the permission of Professor Epstein and/or the Wall Street Journal.
In this holiday season, we are reminded that it is better to give than to receive. But it is even better to give what you own -- not what belongs to other people.
Yet that's precisely what Congress and the president did
when it presented Disney shareholders with an early Christmas present this
year by passing the Copyright Term Extension Act. This measure, which the
president signed in October, extends the period of copyright protection
on existing copyrightable material by 20 years. For a grateful Disney,
which led the lobbying for the legislation, this was no Mickey Mouse extension
but a gift of billions of dollars in future revenues. Thanks to Congress's
giveaway, its happy gang of cartoon characters -- Mickey, Donald, Goofy
and Snow White -- won't soon slip into the public domain.
Our legal system recognizes no natural, perpetual
right to copyright. Copyright's constitutional pedigree allows Congress
to make take-it-or-leave it deals with authors. To promote their literary
and scientific efforts, authors get the exclusive use of their work
for a limited period of time.
In return, everyone gains the right to use the copyrighted
material once its protected period is over. The limited period knocks out
the monopoly restrictions on the dissemination of the work by allowing
its free use to everyone else, including other authors. It also has the
added virtue of keeping the government forever out of the business of controlling
literary works forever.
This copyright bargain, however, only makes sense
going forward. The works covered under the new law were produced with the
incentives available under then existing law. The public gets no new quid
pro quo from extending copyright protection for works already created.
Removing these works from the public domain works a huge uncompensated
wealth transfer from ordinary citizens to Disney, Time Warner and other
holders, corporate and individual, of preexisting copyrighted material.
It also produces a net social loss by restricting overall level of use
of this material.
In other words, Congress's political conniving will
cost the public billions. It may be unconstitutional to boot. Here's why.
When Congress takes property from a private individual
for public use, it must compensate the holder of that property for the
loss. One function of that protection is to prevent government from singling
out an individual or group to bear exclusive burdens for benefits obtained
by the public at large. A second function is to improve the odds that Congress
only takes property with greater value in public than private hands, which
won't often happen if it can snap up property for nothing, or even for
less than it is worth.
The Constitution does a worse job with government
givings than with government takings. But the applicable principles
are the mirror image of those that govern moving assets from private to
public hands.
Suppose the Disney board transferred Mickey's copyright
to Michael Eisner's family without charge. Disney shareholders could recover
the copyright from the Eisners just like they could recover transferred
cash, land or Goofy's portrait. Similarly, Congress cannot transfer literary
works in the public domain unless it receives a quid pro quo, conspicuously
absent here, for the benefit of all in exchange.
More than 100 years ago, under what's known as the
public trust doctrine, the Supreme Court set aside an Illinois grant of
land to the Illinois Railroad as an improper disposition of public assets
for private benefit. Similarly, the public trust doctrine ought to apply
to the new grant of intangibles under the Copyright Extension Act. If anything,
the mechanics for setting aside a transfer of intangible property are easy
to work out, for no reconveyance of specific land has to be made to the
government. Ordinary citizens can simply resist copyright infringement
suits brought by holders of expired copyrights.
Defenders of the act have urged that the extension
was necessary to allow U.S. firms to take advantage in the European Union
of the 20 additional years of copyright protection available there. The
applicable legal rule protects U.S. copyrights in the EU, and vice versa,
only for the shorter period in either place.
Before the Copyright Term Extension Act, the shorter
U.S. standard applied both here and abroad for cross-national copyrights.
The act therefore benefits U.S. firms by allowing them to continue to charge
for copyright use overseas. By the same token, it protects EU copyrights
in the U.S. for another 20 years, and thus harms American consumers twice,
once for domestic and once for European works.
Some readers might find it odd that I take so dim
a view of the copyright holders' new claim in light of my nonstop condemnation
of the paltry protection offered private property under the Constitution's
takings clause. But the real-estate cases that sparked my criticism are
very different; the individual owner has perpetual title in his own property
while here the copyright holder's term had run out.
My position, moreover, does protect some copyright
holders against a second provision of the new law -- the Sensenbrenner
Amendment, which flatly exempts small restaurants, bars and shops from
paying license fees for the right to broadcast copyrighted music. Congress's
ad hoc pruning of existing property rights works no better for copyrights
than for land: It is as unconstitutional as a hypothetical statute that
allows only stamp clubs to use an owner's land free of charge while preserving
to the owner the right to exclude all others.
Two wrongs don't make a right, in copyright law
or anywhere else. Congress has the power to tinker with the length and
scope of copyright protection for new works. But once rights have been
created under an existing system, both sides of the bargain, public and
private, should be respected.
The stability of property rights in the face of
government intrigue is as important for literary work as it is for land
or water. It is as necessary for rights in the public domain as for those
in private hands. The Supreme Court shouldn't tolerate the copyright shenanigans
of Congress on this or any other Christmas.
---
Mr. Epstein is professor of law at the University
of Chicago, and author, most recently, of "Principles for a Free Society:
Reconciling Individual Liberty With the Common Good" (Perseus, 1998).
(See related letter: "Letters to the Editor: Why Should We Seize An Author's
Property?" -- WSJ Jan. 8, 1999)