Law and Tech A weblog on Law and Technology


High Speed Trading

The New York Times reports on High Speed Trading, using a loophole in the market large firms are cashing in by being able to see trades 30 milliseconds faster than the rest of the market. This coupled with co-location of computer systems give these large firms like Goldman Sachs an advantage as they are able to execute automated trading using these computers faster than it takes to blink. These came to light when a former employee of Goldman was arrested for allegedly stealing the software code that runs these machines.

The inequity that high speed trading gives these large corporations billions of dollars a year, all on the backs of the little investor who certainly can not compete with the technology of these behemoths. It appears time for the SEC to step in and regulate, at least investigate, these practices.


Amazon is watching…

As the NY Times reports, unbeknownst to Amazon’s Kindle customers who purchased e-books of George Orwell’s 1984 and Animal Farm, the titles were secretly deleted from their owners devices. The books were deleted and customers accounts credited because the books were added to the Kindle store by a company that did not have rights to them. As comments rolled in on the Times’ Bits blog many questioned what it means to own an e-book.

Different protections exist for the protection of dead trees of older tech and the ones and zeros of the new age. These differing schemes afford the purchasers of the different media different rights with respect to their copy of the same underlying work. Technology and norms create differing schemes for protecting content owner’s rights. For instance, copyright law’s first sale doctrine (17 U.S.C. 109) gives the owner of a copy of a copyrighted work the ability to sell the copy without needing authorization of the copyright holder. This right does not extend though to works that are acquired through “rental, lease, loan, or otherwise, without acquiring ownership of it.” 17 U.S.C. 109(d). Here we see law work in tandem with societal norms: “I own this book, I can do with it like I please.”

Moving to the digital age where the norms have not been set in stone there are many differences. Some differences are technological while others are differences in the norms of the medium. Digital files are easily distributable due to networks like the Internet and can be copied from one device to another easily without destroying the first copy. The ease of making a perfect copy creates a different landscape than in the world without digital files. The other major difference is that the copy that the user has does not degrade over time, unlike “real” copies. (Though, it can be argued that in an ever evolving world of file formats, a single file’s shelf life may not be that long as a new file format supersedes it without backwards compatibility without an easy conversion process.) Also, with a change in medium also created a change in the way works are distributed. From one where the consumer “owns” the product to one where they merely license it. These ease of license agreements and limitations of use of the product are due, in part, to the ease the works are transmitted. This ease worried copyright holders and so they have lashed back and educated the public that file sharing and other forms of digital distribution are wrong (morally and legally). Also through the introduction of DRM and other digital locks, it became more difficult to freely and easily transmit files. Norms were created that said “I can use this book, but I cannot share it with anyone else.” And so, while it was commonplace for people to share a CD, book, or video game, due to new norms, locks, and licenses digital versions of the same works are effectively for the purchaser only.

It is interesting to see the immense freedom (anarchy) the digital landscape provided originally created a world in which there is more
control over content than ever. It appears in the future we will see more tactics like Amazons to retake the data they sold the user. Like the article noted: “it’s like Barnes & Noble sneaking into our homes in the middle of the night, taking some books that we’ve been reading off our nightstands, and leaving us a check on the coffee table.”


Wikipedia, a market approach to copyright?

Copyright gives the owner of the copyright an exclusive right to distribute and display their images. 17 U.S.C. 106. This exclusivity
creates an effective monopoly on a particular creative work. In some instances this exclusive right gives the owner a lot of bargaining power
when dealing with those who want to use the content. (Just look at the music and movie industries, piracy aside.)

The NY Times reports that Wikipedia has a strong policy of using works that are licensed under a very unrestricted Creative Commons license which professional photographers are weary of. Because of this, Wikipedia does not have many good photographs of celebrities. But, at the same time celebrities want their (good) pictures on Wikipedia. But, because of the licensing restrictions on Wikipedia, if it can go there anyone can basically take and use the content – much to the chagrin of the photographers.

The article finishes with a quote from celebrity photographer Jerry Avenaim: “To me the problem is the Wikipedia rule of public use . . . If they truly wanted to elevate the image on the site, they should allow photographers to maintain the copyright.” It appears that as Wikipedia becomes more indispensable we’re going to see a much greater push of celebrities to get pictures of their likeness on the site licensing restrictions on the part of Wikipedia or not. Celebrities may eventually push for some photos of them to be distributed with a CC or other “copylite” licenses. In this case it’s Wikipedia’s relative exclusivity that beats out the content owner.