The Right to Resell: A Ticking Time Bomb Over Digital Goods (paidContent)
With a conflict brewing over consumers’ rights to use platforms like ReDigi to resell their books, music and other digital property, libraries and companies are joining together to lobby for Digital First Sale rights.

Alibaba Group’s Taobao Removed From “Notorious Markets” List by U.S. (TechCrunch)
The U.S. government announced that it has removed China’s Taobao Marketplace from its yearly list of the world’s most “notorious markets,” a distinction Taobao earned for being rampant with pirated and counterfeit goods.

Anti-Piracy Chief Patents “Pay Up or Disconnect” Scheme (TorrentFreak)
One of the top executives of the U.S.-based anti-piracy outfit Digital Rights Corp has submitted a patent application for a system that will demand a fee from Internet users caught downloading copyrighted material.

U.S. Report Slams Russia’s VKontakte Over Copyright Infringement (RT)
A USTR report has accused Russia’s largest social network site of copyright infringement, claiming the site allows users to access and share copyright-protected content without right-holders’ permission.

Hurt Pirates by Targeting Their Ad Money, Says Rock Star (paidContent)
David Lowery, lead singer of the rock band Cracker, says the best way to fight piracy is to hurt the pirates in the pocket book by cutting off their ad money, and specifically by naming and shaming the advertisers who allow the pirates to make money.

Google: Copyright Removal Requests Spike to 2.5 Million Per Week (The Hill)
Google announced that the number of requests it receives each week to remove links to allegedly infringing websites has risen from 250,000 per week to more than 2.5 million per week over the past six months.

Content Delivery Booms: Outbrain Buys Firm that Brings Media to Brands (paidContent)
The way content is being passed around the internet is changing, with companies like Outbrain that are making it possible for businesses to access and host content without engaging in costly licensing negotiations or piracy.

BRICs Score Lowest on IP Protection Index (Reuters)
A new U.S. Chamber of Commerce index intended as a tool for U.S. policymakers to push for tough protections of U.S. intellectual property gave Brazil, Russia, India and China the worst scores for protecting intellectual property.

A copyright law that lets authors break contracts after 35 years will start taking effect in January. These so-called “termination rights” could provide yet another disruption for traditional publishers who may face the loss of their back lists as authors begin using the Copyright Act to reclaim works they assigned years ago.

BPI Requests UK Pirate Party Shut Down Pirate Bay Proxy (Ars Technica)

The British Phonographic Industry sent a letter demanding the UK Pirate Party shut down their Pirate Bay proxy service that was launched earlier in the year when ISPs began blocking access to the original Pirate Bay site.

“Six Strikes” Copyright Enforcement Postponed Until 2013 (Ars Technica)

The Center for Copyright Information announced that the rollout of the “six strikes” warning system will be delayed until early 2013 due to damage from Hurricane Sandy, which affected their testing schedules.

Facebook Privacy Chain Letter Resurfaces (The Washington Post)
The latest Facebook hoax claims users can change their copyright rights by simply posting a status message. The post illustrates how much users want clear control over content they post to Facebook.

Cable Companies Say They Won’t Disconnect Accused Pirates (CNET)
Verizon and Time Warner Cable said that after they repeatedly inform customers through the forthcoming “six strikes” program that their activities appear to violate copyright law, the companies’ obligation is fulfilled, and no account termination will take place.

UK Student Escapes U.S. Extradition in Copyright Case (Reuters)
Richard O’Dwyer, a British university student who launched a website linking to free films and TV shows, reached an agreement to avoid extradition to the U.S. and possible jail over copyright infringement allegations.

ICANN Issues Early Warnings Over Controversial Top Level Domains (Techworld)
The Government Advisory Committee, a panel representing about 50 of the world’s national governments that provides advice to ICANN on public policy issues, has filed 242 “Early Warnings” on applications that are thought to be controversial or sensitive.

Dear Colleagues,

It has been an immense privilege to lead the PTO, our nation’s innovation agency, over the last three and a half years-and it is with deep gratitude for your dedication and hard work that I write to inform you that I will be leaving the Agency around the end of January 2013.

I cannot thank you enough for your hard work over the years-and I wish you all the very best ahead.

Prior to joining the PTO in 2009, Director Kappos worked for SIIA-member IBM as Vice President and Assistant General Counsel, Intellectual Property Law. During his tenure with the PTO he oversaw enactment of the most significant reforms to the patent system this century. We are grateful to Director Kappos for all the improvements to the patent system that he spearheaded during his term as Director and all the hard work and leadership he provided as the “face of the patent system” in the U.S. and abroad.

China Official Defends Record on Fighting IPR Thieves (Variety)
The head of China’s State Intellectual Property Office acknowledged a piracy problem in China, but says the Western media has ignored the government’s efforts to combat piracy, and instead has highlighted the negatives.

iOS Apps Hijack Twitter Accounts, Post False”Confessions” of Piracy (Ars Technica)
iOS application developer Enfour is fighting piracy by auto-posting tweets to users’ accounts to shame them for being pirates, but a “glitch in the anti-piracy measures” caused the auto-tweeting to affect a huge portion of its paid user base.

Man Sentenced to 36 Months for $2.5M in Software Piracy (Equities.com)
A Virginia man was sentenced to 36 months in prison, followed by three years of supervised release, and ordered to pay restitution of $2.5 million for selling thousands of units of counterfeit and pirated software.

D.C. Circuit Voids $743K Restitution Order in Pirated Software Case (LegalTimes)
The U.S. Court of Appeals for the D.C. Circuit unanimously ruled to vacate a court order that required the defendant pay Adobe $743,098 (the amount equivalent to the sale of pirated software), because the government failed to show Adobe’s actual losses from the copyright infringement.

While Hurricane Sandy battered the region, the Supreme Court proceeded to hear arguments in Kirtsaeng v. John Wiley & Co. on Monday, Oct. 29th. The issue in this hotly contested case is whether the copyright law’s “First Sale Doctrine” allows someone who purchased copyrighted works overseas may sell them here in the U.S. without authorization from the publisher. SIIA’s amicus brief in the case defended the view that these purchases violate U.S. copyright law, since the first sale doctrine does not apply to a work made and sold abroad. The Kirtsaeng case will likely be a monumental case for both the content publishing and software industries — it will affect the distribution, market segmenting, and licensing practices on which their businesses are significantly built. Within the Supreme Court, the Justices seem fairly split on the issues (see full transcript). SIIA has been actively pushing our position on this issue in the press, releasing press statements and publishing various blog posts on the topic. Additionally, SIIA’s Keith Kupferschmid participated in a panel discussion last week on HuffPo Live. Read more here.

IP News

Hosting Site Found Liable for SumoTorrent’s Infringement (PCMag)
A Dutch court found that hosting company XS Networks is liable for the activity of SumoTorrent, a torrent site it hosted.

New Twitter Policy Lets Users See Tweets Pulled Down for Copyright (GigaOM)
Twitter is changing the way it responds to DMCA copyright notices. Instead of removing tweets, it is “withdrawing” them in order to help show when and why tweets go missing, and bring transparency to the DMCA process.

Porn Downloader Ordered to Pay $1.5 Million Fine in BitTorrent Decision (Forbes)
A Virginia man was ordered by an Illinois federal court to pay $1.5 million to adult film company Flava Works. In the default judgment entered last week, the judge set the maximum penalty of ten times statutory damages, the biggest penalty to date in a BitTorrent case.

Donuts’ Grab for Domains Raises Fears of Cybersquatting (Bloomberg)
A little-known company called Donuts Inc. is making a grab for valuable new domain names, a move that opponents say could fuel the practice of stealing website identities. A lawyer representing TLD holders is asking ICANN to investigate the company.

Two Members of Piracy Group IMAGINE Get Prison Terms (CNET)
Two members of a group that wanted to be known for being first to release the latest Hollywood films to the Web were sentenced to prison and ordered to pay thousands in restitution.

Piracy Cuts Into Paid App Sales (Bloomberg)
Pirates are turning to apps and making a significant dent in mobile-app store sales, which researcher Yankee Group expects to generate $10.1 billion this year. While app stores are trying to beef up security, startups are also producing software to help developers thwart piracy.

We believe that, if the First Sale Doctrine were to apply to materials made and sold overseas, it would severely undermine U.S. companies’ ability to compete in foreign markets. At today’s Supreme Court argument, the Justices seemed fairly split on the issues. Wiley’s counsel, Ted Olson, reiterated a critical point made in SIIA’s brief – that there are many of exceptions in the Copyright Act, including the Fair Use Defense, which can be used to prevent the concerns raised by the appellant.

Ultimately, we hope that the Court will be convinced by the very real argument that both publishers and consumers will face direct harm if our markets are allowed to be flooded with copyrighted material that was intended for purchase overseas. American consumers will be defrauded into buying products that may be inferior or otherwise very different from those intended for U.S. markets, while confronting higher prices in the long run. Meanwhile, consumers and students abroad will lose access to valuable U.S. resources that were created for them.

Brands Cry Foul Over Unauthorized Sellers on Amazon (Reuters)
Amazon is grappling with a problem that eBay has struggled with for years – the proliferation of unauthorized third-party sellers that undercut the world’s top consumer brands.

Massachusetts Fines Thai Seafood Company Over Pirated Software (The Boston Globe)
Massachusetts’s fined the Narong Seafood Co. $10,000 over the use of pirated Microsoft software, marking the first time the state has ever used laws intended to combat unfair business practices against a company for illegally obtaining software.

BuzzFeed Lawsuit Over Celeb Photos Raises Copyright Questions (GigaOM)
At a time when online media is increasingly image-based, a $1.3 million lawsuit brought by a so-called “copyright troll” over BuzzFeed’s publication of nine celebrity photos raises questions about current copyright law.

Publishers Fight Back Against Schoolbook Piracy (The Village Voice)
With textbook piracy on the rise (spurred by rising costs of course materials and proliferation of tablets and e-readers), publishers have quickly embraced new technology to fight the growing piracy problem.

Cloud No Cover for Software Pirates, Claims FAST (CloudPro)
The Federation Against Software Theft (FAST) denounced the Pirate Bay’s move to the cloud as useless, saying measures already exist for governments to access cloud data in cross-border criminal investigations.

Retailers, Libraries, and Internet Companies Join “Owners Rights” Coalition (Publishers Weekly)
With ownership rights at issue in the Kirtsaeng vs. Wiley case, a new coalition of businesses and libraries has formed to advocate for ownership rights while educating consumers, businesses, and policymakers.

On October 10th, in Authors Guild Inc. v. HathiTrust, the U.S. District Court for the Southern District of New York held that, under the Copyright Act, associations do not have standing to bring copyright infringement actions on behalf of their members. The court did say that because the U.S. constitution does not prevent associations from bringing suit, foreign associations might have standing, if such standing is provided for under their home countries’ copyright laws. The case involves a lawsuit between various authors and university libraries over the mass digitizing the authors’ copyrighted works through the Google Book Search program. Under this program, Google made arrangements with several of the world’s largest libraries to digitize the entire contents of their collections to create an online searchable database, and to provide the libraries with copies of the digitized versions of their collections. In 2011, a group of libraries that participated in this program established a new service, called the HathiTrust digital library, to which the libraries would contribute their digitized collections. According to HathiTrust, this database of copies is to be made available for full-text searching and preservation activities. It is also intended to offer free access to works to individuals who have “print disabilities.” For works under copyright protection, the search function would return only a list of page numbers that a search term appears on and the frequency of such appearance. The suit was brought by The Authors Guild and several other parties (including many foreign authors associations and several individual authors) against the HathiTrust, as well as the participating universities (the University of Michigan, the University of California, the University of Wisconsin, Indiana University, and Cornell University).

In addition to addressing the associational standing issue the court also denied the Plaintiff author associations’ motion to prevent the HathiTrust from asserting a defense of fair use. The Plaintiffs argued that Section 108 of the Copyright Act, which allows libraries to make limited copies of certain works for specified purposes, precluded libraries from arguing that their activities constituted fair use under Section 107 of the Copyright Act. However, the court held “Section 108 provides rights to libraries in addition to fair-use rights that might be available.” The court then considered the four fair use factors and determined that the uses of digitized works pursuant to the HathiTrust book digitization project might constitute fair use and therefore Defendants fair use defense should not be dismissed. The decision in this case should not be confused with the pending copyright infringement case between the Authors Guild against Google.

Other IP News

AT&T Starts Six-Strikes Anti-Piracy Plan Next Month, Will Block Websites (Torrent Freak)
A set of leaked internal AT&T training documents reveal that the ISP will start sending anti-piracy warning notices to its subscribers on November 28, under the new copyright alert system. The documents show AT&T decided to implement a targeted website blockade and a copyright course as punishment for repeat infringers.

Korean Pirate Sentenced to Over Three Years in Prison (The Enumclaw Courier-Herald)
Sang Jin Kim, an undocumented Korean immigrant living in Everett, Washington, was sentenced to 40 months in prison and ordered to forfeit $409,776 for operating websites that distributed pirated software, movies, and videos. Kim had plead guilty in July to two counts of criminal copyright infringement.

Music Publishers Win $6.6 Million in Song Lyrics Copyright Case (Sacramento Bee)
In a first of its kind case establishing liability for posting unlicensed song lyrics on a website, a U.S. District Court judge awarded $6.6 million in statutory damages to a group of leading music publishers.

FBI in DC Creates Intellectual Property Squad (ABC News)
The FBI’s Washington field office has created an intellectual property squad dedicated to investigating all corners of intellectual property and economic espionage.

Study: Trolls Account for 40 Percent of Patent Lawsuits (GigaOM)
A study of 500 patent lawsuits found that those brought by patent trolls almost doubled in size from 2007 through 2011, and accounted for nearly 40 percent of the cases brought in 2011.