Gavin R. Putland,  BE PhD

Monday, March 25, 2013 (Comment)

Is Australia's plus-70-year copyrort term unconstitutional?

A copyright is a bargain whereby We the People, in return for the creation of a literary or artistic work which We the People may freely use after a certain date, give the creator the exclusive right to profit from the work until that date. On the next day, the copyright is due to expire and the work is due to enter the public domain.

But when the expiry dates loom, the copyright owners — who by this time are seldom, if ever, the original creators — don't want to keep their side of the bargain: they repeatedly demand, and get, extensions of copyright on existing works. Every such extension deprives Us the People of another slice of the benefit that was due to us under the agreement by which we granted the copyright. In other words, every such extension is a massive theft of intellectual property from Us the People, for the benefit of Them the copyright owners; indeed, the biggest thefts of intellectual property in history have been extensions of copyright on existing works.

Meanwhile the copyright owners complain incessantly about alleged thefts of their rights, but never about their thefts of our rights: we must not steal, but they may lobby Parliament or Congress to steal from us for their benefit.

There is no element of theft if the copyright extension applies only to future works, because property rights in those works do not yet exist and will not be created until the works themselves are created. Only when the copyright extension applies to existing works does it deprive Us the People of existing rights.

But nobody bothers campaigning for a copyright extension applying only to future works. If the current term is (say) 70 years, and if that term is increased to (say) 90 years for a work that you will produce next year, you won't see any benefit until 70 years later, by which time you will be dead. Even if you're acting for a corporation with a theoretically infinite life, cash-flows so remote in the future, if they can be quantified at all, are so heavily discounted in your present-value calculations that they hardly matter. Therefore an extension from 70 years to 90 years on future works will not measurably increase your incentive to create new works. Therefore it is not in the interest of future generations to make them wait any longer for the works to enter the public domain. But if the extension applies only to future works, it cannot, as far as I can see, be characterized as theft, whatever its other faults may be.

In contrast, if you own an existing 69-year-old copyright that is due to expire next year, it is very much in your interest — albeit against everyone else's interest! — to have its term extended. Therefore the perpetual global campaign for extensions of copyright is motivated solely by the hope that any such extensions will apply to existing works. In other words, it is motivated solely by the hope of legalized theft.

But can the theft really be legalized?

In the USA, yes it can — not because of what the Constitution literally says, but because of how the Supreme Court has chosen to interpret it.

Clause 1.8.8 of the U.S. Constitution empowers Congress “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries”. Because Congress has only such powers as the Constitution gives it (other powers being either reserved for the States or disclaimed altogether), one might hope that extensions of existing copyrights are unconstitutional because they fail to “promote the Progress of Science and useful Arts”. One might also notice that if an existing copyright can be extended once, it can be extended again and again ad infinitum to circumvent the “limited times” requirement. But in Eldred v. Ashcroft (2003), the Supreme Court reaffirmed its view that it is for Congress to decide whether in fact a proposed law will “promote the Progress of Science and useful Arts”, and gave the green light to perpetual copyrights as long as they are legislated in steps of finite duration.

Thus the Supreme Court rubber-stamped the Copyright Term Extension Act 1998, which extended the terms on existing works by 20 years. In consequence of that Act, the procession of works into the public domain in the USA, which had been stalled since the 1970s, is not due to resume until 2019. We may therefore rest assured that copyright owners, in their efforts to secure yet another extension of copyright on existing works, will devote massive resources to the 2016 Congressional elections and to lobbying in the subsequent Congressional term.

The Fifth Amendment to the U.S. Constitution says, in part, “nor shall private property be taken for public use, without just compensation.” As the extension of copyright on existing works takes property for private use, it would seem not to be covered.

In Australia it's different. Under s.51(xviii) of the Australian Constitution, Federal Parliament has power to make laws with respect to “copyrights, patents of inventions and designs, and trade marks”, without any constraints concerning the purpose or duration of intellectual property rights. But under s.51(xxxi), Parliament has power to make laws with respect to “the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws” (my emphasis). Obviously copyright is one such purpose. As Parliament has only the powers that the Constitution gives it, such acquisitions are unconstitutional if they are not on just terms. The extension of copyright on existing works, being a compulsory acquisition of property rights from Us the People for the benefit of private interests, would appear to be covered by the “just terms” requirement.

The scope of “property” in s.51(xxxi) is not explicitly limited to private property. But even if such a limitation is read into it, the expropriation of intellectual property from the public at large becomes a private loss as soon as a particular person or firm is prevented from freely using an existing work due to an extension of copyright. The private loss is all the more stark in the case of a person being sued or prosecuted for breaching a copyright that was due to expire before the time in question.

The extension of copyright on existing works is a compulsory acquisition of intellectual property, not on behalf of the Commonwealth, but on behalf of the copyright owners. Hence we must ask whether “acquisition” in s.51(xxxi) includes compulsory acquisitions on behalf of parties other than the Commonwealth. If so, such acquisitions are covered by the “just terms” requirement. If not, such acquisitions are altogether beyond the power of Parliament, whether on just terms or not.

I conclude that in Australia, extensions of copyright on existing works are unconstitutional unless We the People are justly compensated. In particular, I conclude that the U.S. Free Trade Agreement Implementation Act 2004 is unconstitutional in that (i) films and sound recordings published in or after 1955 had their copyright terms extended from 50 years to 70 years, and (ii) other works whose creators died in or after 1955 (including works underlying films and sound recordings) had their copyright terms extended from “life plus 50 years” to “life plus 70 years”, even if the creators never owned the copyrights! The effect was that works which were due to enter the public domain on or after 1 January 2006 would be kept out of it for 20 years longer, without compensation.

In consequence of these extensions, the procession of works into the public domain in Australia has been interrupted for 20 years and is not due to resume until 1 January 2026. We may therefore rest assured that in the few years before 2026, unless the extensions in respect of pre-existing works have been ruled unconstitutional, copyright owners will launch a massive lobbying campaign for yet another extension of existing copyrights. They have no intention of honouring their agreement with Us the People.

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