Antigua May Be Allowed To Violate US Copyrights

Skleed refers us to the NYTimes for an article on the high-stakes case the US is losing before the World Trade Organization. So far the US has lost an initial hearing and two appeals on its policies regarding Antiguan offshore gambling sites. Now the lawyer pressing the case has asked for a rarely invoked, but codified, recourse under WTO rules: letting Antiguans copy and distribute American music, movies, and software. The game may be to get Hollywood and Microsoft, et al., to pressure Washington to cut a deal. But their influence may not be sufficient to move lawmakers on the question of online gambling. From the article: "But not complying with the decision presents big problems of its own for Washington. That's because Mr. Mendel, who is claiming $3.4 billion in damages on behalf of Antigua, has asked the trade organization to grant a rare form of compensation if the American government refuses to accept the ruling: permission for Antiguans to violate intellectual property laws by allowing them to distribute copies of American music, movie and software products, among others."

Allofmp3 mark II is coming

I love it.

Re:

Wouldn't that be just digging the hole deeper - Antigua is a WTO member and as such the other nations would be violating their treaty obligations if they caved to such pressure.

Re:

This is not remotely similar to the issue with the International Criminal Court. The ICC is an organization that the United States has simply declined to join. That's not some kind of "exemption".

Not that the US hasn't sought or received such exemptions

In other news

Intellegence indicates WMD hidden in Antequa. Marines sent to investigate.

Re:In other news

Weapons of Mass Duplication?

Facinating and legally brilliant

What the lawyer has done is basically utilized the US's own insistace at the WTO against them, and really leveredged the law to it's extreme. So, either the US gets shot or hung, depending on which way the case goes. In either case, the US's legal case just died.

I am confussed

So I assume the US banned gambling in other countries via the net because the govt wasn't getting a piece? Is that the bottom line? Or is there another reason?

Re:

It's also because gambling overseas cuts into the income of the casinos based in the US. IIRC, it's mostly the casino lobbies pushing the legislation about off shore gambling.

Backstory

The U.S. banned international online gambling because of pressure (read: bribes) from the big domestic casinos. Mainly the Indian tribes and the Vegas / Atlantic City ones. Probably the state lotteries, too.

They made it into a "moral issue," but that's just bullshit that they can sell to a few Evangelical hicks. The real issue was that the casinos felt that international companies were cutting into their business, so they had Congress close it down. It was pretty straightforward protectionism; online betting with U.S.-based B&M casinos (including internet off-track betting on horses, internet purchase of lottery tickets, etc.) is OK, but international ones are not.

The WTO saw this for what it is, and is basically saying, 'either you let everyone compete, or you shut it all down.' So this puts the U.S. in the position of either letting international casinos into the U.S. market, or shutting down all internet gambling (including aforementioned web-based off-track-betting, lottery tickets, sports books, etc.). The casinos -- particularly the Vegas ones -- wouldn't like that much either.

So it's going to be interesting to see how this plays out. I have to give the Antiguans -- and most of all, their lawyer [iht.com] (who is from Texas) -- credit. It takes some brass ones to go eye-to-eye with the USG, even when they're doing something that's so transparently corrupt. I hope they can pull it off.

Re:Backstory

The U.S. banned international online gambling because of pressure (read: bribes) from the big domestic casinos.

Why does misinformation like this keep getting modded up as informative? It happens every time the online gambling issue comes up on Slashdot.

The American Gaming Association, the industry group representing those big domestic casinos, opposed legislation banning online gambling. See:

http://www.pokernews.com/news/2006/5/american-gami ng-association-study.htm [pokernews.com]
http://www.americangaming.org/hillupdate/reports_d etail.cfv?id=9 [americangaming.org]

They want legalization and regulation, so they can get a piece of the pie. They're currently supporting legislation requiring a "study" of online gambling, as a preliminary to repealing the ban.

Right now online gambling is a booming international industry, but American companies can't reap any of the profits, despite what should be a very strong competitive position with their strong brands. The potential gain of locking in American gamblers to land-based casinos is negligible by comparison.

They made it into a "moral issue," but that's just bullshit that they can sell to a few Evangelical hicks.

That's not the cover story - it's the whole story. Banning online gambling has been a plank of the Republican Party platform since at least 2004:

http://www.gop.com/media/2004platform.pdf [gop.com] (see page 57)

The most recent anti-online-gambling law, the Unlawful Online Gambling Enforcement Act, was railroaded through the Senate (as a last-minute amendment to a must-pass bill) by Bill Frist. Bill Frist, at the time, was a hopeful for the Republican presidential nomination, and as such needed to shore up support among the moral conservative types.

Re:

That's not cynical at all; it's just a fact. When I write a letter to my Congressman (Burgess, an administration stooge), that's not called lobbying; it's maybe "petitioning" or "wasting ink" if you prefer. If there's a campaign contribution attached, or

Re:I am confussed

Although there is little evidence of this on the Internet, from my association with gaming I believe the complete ban on online gaming is not just due to taxation but also regulation. Once you open the door to online gaming you have a low barrier to entry into potentially the most lucrative criminal enterprise possible.

Las Vegas was the Fort Knox and money printing machine for the mob in the US in the 1950's. The guys at the top had some brains and understood they had to play reasonably fair with the suckers or they wouldn't come back and the suckers had to have a "good time" while they were there. This put limits on what could and could not be done.

I don't see any limits when you move it online. How do you know if you are being cheated? You wouldn't. You get to hear from people praising their big wins. And believe me, there is plenty of money going around so people can win big. The difference between a 98% payout and a 95% payout is incredible. Bring that down to 50% and you have something that wouldn't be legit in the US but would bring in billions.

Why couldn't it be 50%? Online it certainly could and nobody would be looking at the annual reports from a site run from either some small Carribean country or Russia.

I do not see how it could be regulated. With the current grab-all-you-can philosophy in the US players would flock to sites offering the opportunity to win big. And you would have TV ads running with extremely happy big winners. Even if such ads were illegal on TV, you would have them on YouTube.

Sorry, I just see it as a new and better way to part dollars from suckers at a faster pace.

Re:I am confussed

I'm sorry, I don't see the problem. If you want to gamble away all your money, that's your prerogative. It doesn't matter if there's a 95% payout or a 0% payout; you're still most likely to lose. The government has no business regulating this.

Re:I am confussed

What are you talking about? My online gambling site is subject to stringent regulations to make sure they don't overstate payouts or take an undisclosed share of my funds. It's based in America, but I access it online. For most of the games I play, the payout is REALLY high, too, above 99.5%.

It's Vanguard Investments, in case anyone's wondering.

Another reason.

It's not that simple.

Online gambling has been banned in the US for years by the same laws that made it illegal to wager over the phone. So there were never any domestic online gambling companies, because the US would just arrest the people running them for violating existing law.

But, the US couldn't get at people who ran online gambling companies outside the country, and while the US could have technically prosecuted individual gamblers for gambling online, that would hardly be practical. So instead, the US recently made it illegal for US banks and credit card companies to process payments to online gambling companies, effectively preventing US citizens from gambling online since it's now much harder to get your money to the gambling site.

The trick here is that the law only applies to certain kinds of online gambling, specifically, the kind of online gambling common in casinos, as it was mainly the casinos pushing for this legislation (under the guise of 'gambling is evil!'). So, the US had a situation in which certain domestic companies could engage in gambling as a trade, but certain international companies could not - and that's the basis of the WTO dispute.

The US actually has a very similar construct with regard to free trade amongst the 50 US states - it isn't legal for any state to have laws which favor domestic commerce over commerce from parties in other states. For example, in a recent ruling, the Supreme Court struck down a state law that banned companies from directly shipping alcoholic beverages to customers from out of state while allowing domestic producers to do so. Supreme Court said you had to either ban all mail-order alcohol sales or none.

And that's what the WTO is saying. The US is free to ban gambling, so long as they ban ALL gambling, not just gambling done by companies outside the country. And the US would be free to tax gambling, so long as it taxes ALL gambling. So the problem isn't that the US isn't getting a piece - they could allow gambling and tax it and get a piece. The problem is that because of the existing ban on online wagering that pit US casinos against non-US online gaming sites, the US companies were losing business to the non-US companies, so the US banned gambling at the non-US companies, which is exactly the kind of practice the free trade pacts and the WTO are supposed to prevent.

Re:I am confussed

The actual ban was a last-minute, backdoor provision, slipped into another bill with no debate and no formal vote.

It was widely expected to fail, but then Bill Frist tacked it onto a port security bill.

Looking at his lifetime donors [opensecrets.org], it doesn't appear to have been for a traditional special interest group. Instead, I think it was just a failing congressman, trying to appeal to the fascist evangelicals, who wish to legislate their morality on the rest of us.

Re:

tacked it onto a port security bill

What kind of fucked-up system allows this to happen?

Seriously.

Re:I am confussed

Sadly this is incredibly common. Frist had publicly announced his intention to attach the gambling ban to any must-pass legislation that came through.

It's not even the worst example of this kind of behavior. I think that is saved for the conference committee trick. If you're not aware, that is where the House and the Senate pass slightly different versions of a bill, and then a "conference committee" resolves the differences in the bill. But sometimes instead of just resolving a difference, they'll add in new language, or completely change the meaning of the laws that were just passed, thus neatly overriding the intent of the legislature.

Government is a hell of a scam.

Oh hell yes

Hey Pirate Bay! You just got your island!

May Be Allowed? I think not...

Just because the lawyer representing Antigua has requested this method of penalizing the US for violating WTO rulings doesn't mean the WTO would actually allow it. I don't recall anything in that article that even hints at the WTO following that line of reasoning.

Re:May Be Allowed? I think not...

Then you didn't finish the article, including the fact that Ecuador was, at one point, granted just this sort of relief. Ecuador chose not to exercise their right to ignore US intellectual property claims, and instead used it as leverage in trade negotiations.

And we care...why?

Fry: "What do we care? We live in the United States."
Leela: "The United States is part of the world."
Fry: "Wow, I have been gone a long time."

Thankfully, that is a transcript from the future, and America is not yet part of this "world" of which the UN speaks of

What do the hope to win?

Considering the US has a long history of not complying with WTO rulings that don't suit them, I am surprised that they would even try this method; even if the WTO were to rule in their favour, they know all too well that the WTO is all bark and no bite.

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...when applied to the US. The WTO has quite a lot of bite with most developing nations. Just clarifying your statement.

Watch the Blackhole!

Yes, Antigua can get the compensation. Watch the US then blackhole the whole country. No traffic passed through US territory or assets of US taxpayers. Maybe only by Disney applying to Federal Court for an injunction. Not even a GEC (Cuba-level embargo) would be needed.

Of course, this won't much stop satellite to the EU but smuggling is a serious offense and the US could easily put anyone involved in "facilitation" on watchlists (arrest on sight).

Does this give them the right to export?

If other countries have to honor the US copyrights, does that mean they can't import the goods from antigua?

The WTO and Health and Safety Standards

First, no one is talking about (or they shouldn't be if they are) a blank check to violate copyrights. They would be allowed to violate copyrights of a value equivalent to the estimated value of the loss created by the United States' alleged improper behavior. If that loss is estimated to be $3bn, they could be given permission to violate $3bn in copyrights.

The more important question is why does Antigua respect American copyrights at all? Well, because they gain from respecting them. It's part of free and fair trade. You aren't just allowed to take something from someone. Along the same lines, you aren't allowed to bar someone from importing goods or providing services to your citizens unless they is a defendable reason - such as an authentic health and safety standard.

The WTO is the body that makes sure everyone plays by the rules. It is a voluntary association and people can leave it - and then make whatever laws they want. So, Antigua can leave the WTO and violate copyrights as much as they want - the problem is that WTO countries then can't/won't trade with them and so they loose a lot more than they would gain.

In this case, the United States would have to prove that online gambling is sufficiently worse and different from traditional gambling (which is legal in the US) - a reason why traditional gambling doesn't pose a threat to their population, but that online gambling does. Antigua needs to prove that the US regulations on online gambling don't actually protect the American people, but are rather meant to give American companies the advantage over Antiguan companies.

This isn't some weird global government looking to get rid of sovereignty. This is about using logic to determine when rules are meant to be discriminatory based on national origin and when something is a genuine health or safety standard. The US can make the argument that online gambling becomes too accessible and is therefore a much greater danger than traditional gambling. Antigua can argue that it's the same thing that happens at casinos. A court will decide which arguments hold weight based on evidence.

Re:The WTO and Health and Safety Standards

...If that loss is estimated to be $3bn, they could be given permission to violate $3bn in copyrights.

According to RIAA estimates, that's about 17 songs worth.

What are the odds?

Anyone offering odds on the outcome?

Re:Allowed?

Ah, but see, it's the use of the WTO's treaty provisions which the US is using to force many other nations to adopt DMCA-like legislation. If the US starts saying 'I don't have to pay attention to the WTO', they risk other countries doing the same, and ignoring the provisions the home grown lobbyists want.

Re:Allowed?

Allowed by the WTO. I will mean that if Antigua did pirate US stuff, the US would not be able to get the WTO to apply any sanctions. Which is pretty much all they could do, as Antigua is not in the Us and it would be awfully hard to convince anyone that you need a new war just cause of some pirate DVDs.

Re:Allowed?

Allowed by the WTO. I will mean that if Antigua did pirate US stuff, the US would not be able to get the WTO to apply any sanctions. Which is pretty much all they could do, as Antigua is not in the Us and it would be awfully hard to convince anyone that you need a new war just cause of some pirate DVDs.

I'm sure the MPAA is working on a draft war declaration as we speak.

Re:Allowed?

I'm sure the MPAA is working on a draft war declaration as we speak.

No kidding. It might be amusing to watch anti-war Hollywood suddenly discover that, while war is always wrong, a "narrow" use of the US military is sometimes necessary for the greater good.

Re:Allowed?

I'm sure the MPAA is working on a draft war declaration as we speak.

Don't forget the matching propaganda campaign, with thrillers like: Saving Private Ryan's Copyright, James Bond: Dr. No...Not Iraq - Bomb Antigua, and We're Out Of Bourne Books But Here's Matt Damon Asking You To Please Bomb Antigua Anyway...

On the plus side, with this sort of motivation behind Hollywood they might turn out to be good movies.

Re:Allowed?

it would be awfully hard to convince anyone that you need a new war just cause of some pirate DVDs. it would be awfully hard to convince anyone that you need a new war just cause of some pirate DVDs.

On the other hand, all those Al Queda terrorists that are using off-shore gambling in Antigua to launder their death money might provide the Whitehouse Junta plenty of ammo to freeze Antigua's assets that are in or pass through US banking.

Re:Allowed?

hard to convince anyone that you need a new war just cause of some pirate DVDs.

Just? JUST???!!!

My god, man, we're talking about pirates here! High seas battles, raped women and children, missing gold, plunder at the bottom of the sea, "arg matey" and worse!

Those cretins are almost as bad as terrorists.

Unless you want to have your next sailing trip interrupted by these cannon-toting freaks, you'd better support a war!

((Those who take me seriously, deserve to. -- Shane Connoly))

Re:Allowed?

That, and congress is full of ninjas. It's true.

Re:Allowed?

That, and congress is full of ninjas. It's true.

Of course you can't see them, they're Ninjas!!!

Re:Allowed?

You know, compared to a Vista install disc, Sarin doesn't seem so bad.

Re:Allowed?

I don't think America's military might is what scares most countries (excepting those whith which you already have some kind of conflict), but actually economic/financial and political might is the problem. America can fight so many stupid wars before things start to get really ugly internally, the problem is that even when in deficit, the US has incredible economical and financial muscle. Subtle threats to drive a small country's economy down the drain with a few moves can lead to misery just as quick and maybe more lastingly (is that a word?) than a conventional war.

Re:it better

They are complaining that they can't instigate transactions online that they would be arrested for here.

Actually, what they are complaining about is that the US is blocking commercial transactions with Antiguan businesses that would be legal if the were businesses physically located inside the US. The WTO says that's a big no-no.

The US has claimed the moral exemption allowed by the WTO - That the morals of the US do not permit online gambling. However, as Antigua pointed out, the US does permit online gambling - OTB on dog & horse racing is legal interstate, and most forms of gambling are legal intrastate - in those states which have legalized gambling of any nature.

The WTO courts have rightly held that you can't claim a moral exemption for international activities, when it is permitted within your country. Either online gambling is morally offensive to the US & it's not to be allowed at all or it's not and the US has to open up the practice to everyone. The US doesn't get to pick & choose which types of gambling are offensive - it's either morally offensive or it's not.

As a case directly on point, it is currently perfectly legal to place a bet on the Kentucky Derby through the OTB website, it is however illegal to place the same bet on the same Kentucky Derby race through an Antiguan online site. This is why the US lost the case, they were claiming that the an action was morally repugnant to the US when done with an Antiguan business, but perfectly acceptable when done through a US based one.

Personally, I think you would have seen a bigger stink if they had gone for patents instead of copyright. The cries of anguish by the US pharmaceutical companies alone should be clearly audible on Antiguan beaches.

As it is, I would like to put in my request for a legal copy of Antiguan Vistas(tm) to run on my computer - just so I can smack the next BSA person I see with it. "Why yes, it is a perfect copy of Windows Vista - without all the DRM crap & calling home. OOh look here, I see that the source code has been released by the Antiguan Software Coalition."

Re:

I assume buying the stuff in Antigua would be legal, but anything bought in Antigua (or on the internet from Antiguan sources) would remain illegal. So, if you want to enjoy your "geek hotspot", you'd actually have to physically BE in Antigua. It's legal

Re:

But you will be when you come back.

From OFAC: Important Changes Effective June 30, 2004

Rules for family travel have changed. There is no longer a general license for travel to Cuba for family visitation. All family travel now requires a specific li

Re:A Beautiful Thing Coming

You are making an assumption that producers/publishers backing is necessary to create art.

There was a time when this was at least mostly true. But now it is entirely possible for anyone to create high-quality music, photography, and (almost, we're still working on this one) movies with digital tools, and to distribute this art, along with their novels, short stories, poetry, theatrical scripts, and just about anything else you can think of, over the internet for little to nothing.

Why do you think we still need the middle-men (publishers, record companies, etc)?

Re:A Beautiful Thing Coming

It would be amazing. Science and culture would flourish like mad. The creation of art would explode, with new forms appearing at a never before seen rate. Businesses would boom with all the new opportunities. We can only hope this becomes our future one day...

Re:A Beautiful Thing Coming

See my reply here [slashdot.org].

Also, I would argue (am arguing) that the drive to create is separate from the drive for money. There would still be artists if creating art was punishable by death, it has nothing to do with making money.

The connection between creating art and becoming rich and famous was propagated by the middle men who looked at artists and said, "You know, I could really make a killing by distributing this." That is capitalism.

Now that we are in the "Digital Age" and distribution can be widespread and done by anyone, the middle-men are threatened and are reacting, sometimes by adapting to the new technology [baen.com], sometimes by suing everyone in sight [blogspot.com].

The ideal solution would be to find a way to reward artists, without restricting the distribution of art. That is the goal, remember? [njit.edu]

Re:WTO wont grant it. Antigua will capitulate.

That's right. Worldwide support for the US has never been so high; were Antigua to incur the wrath of America, the EU and Asian countries would just back off and completely ignore Antigua. The US is the world leader in these things, right?

Re:WTO wont grant it. Antigua will capitulate.

Simple things like issuing a travel advisory against visiting Antigua will kill their tourism. Small amount of grit in the financial sector could harm their trade.

Just like the US embargo against Cuba is hurting their tourist trade, eh????

Re:WTO wont grant it. Antigua will capitulate.

People flock in huge numbers to Florida, Mexico, Jamaica, Puerto Rico, the Virgin Islands, etc. Why would they not go to Cuba if the choice were available, and the price was right?

I think you meant to say "Americans flock in huge numbers to ...".

And that my friend is why Cuba is such a popular destination for the rest of the world. No flocks of Americans.

Re:AllofMP3.com and ThePirateBay

So I imagine the Antigua would be able to violate copyright on 3.4 billion worth of stuff. If the RIAA and MPAA have their way

The way the MAFIAA has been in the past with judgments against them, I suspect they'd send Antigua 340 million copies of Pat Boone's Greatest Hits "valued" at $10 each and call it even.