Copyfraud has received renewed attention in the past few months with the surge in popularity of non-fungible tokens (NFTs). We explain what copyfraud is and how it relates to NFTs.

What is copyfraud?

Copyfraud describes the act of falsely claiming copyright over a work that’s in the public domain.

Any work that is usually subject to copyright can be the target of copyfraud, such as an image, a painting, a book or a piece of music.

Why is copyfraud a problem?

The latter part of the word underlines the incentive here: anyone claiming copyright over a work to which they do not legitimately hold it may be doing so to seek licensing fees or other payments from the use of these works.

Copyfraud cases have typically concerned organizations such as image libraries and heritage and cultural institutions, rather than individuals. These are, after all, more likely to want to display and publish works already in the public domain than an individual might. Of course, it’s also more believable that such an institution may actually hold the copyright to a piece of work in the public domain than an individual claiming the same thing.

This isn’t to say that an individual isn’t as capable of engaging in this kind of behavior, just that they are more likely to claim copyright over an image or another work whose copyright belongs to someone else, rather than to one in the public domain.

Do existing copyright laws help to prevent or encourage copyfraud?

Jason Mazonne, Professor of Law at the University of Illinois who coined the term, states in his 2006 paper on the subject that “copyright law itself creates strong incentives for copyfraud. The Copyright Act provides no civil penalty for falsely claiming ownership of public domain materials … While falsely claiming copyright is technically a criminal offense under the Act, prosecutions are extremely rare.” He goes on to state that copyfraud “stifles valid forms of reproduction and undermines free speech.”

Mazonne provides various examples of everyday media that contains some form of work purportedly protected by copyright, even if this work is actually in the public domain. Greeting cards bearing Monet’s Water Lilies, for example, or books containing Shakespeare’s plays. These will typically be published with a copyright notice that prohibits the reproduction of any part of the published work. But if part of that work contains something that’s already in the public domain, how can the publisher claim that no part of the work may be reproduced?

The fact that copyright – or more specifically, what copyright law does and doesn’t allow – is not that well understood makes it easy to exploit these misunderstandings.

While many photographers appreciate that they will have certain rights over an image they take, ones that prevent others from exploiting that work for commercial gain, they will have less knowledge around the appropriate use of orphan works, works in the public domain and works to which more than one copyright holder exists.

Read more: Copyright and images: What you need to know

Furthermore, copyright law details not only what protections the copyright holder retains, but also what’s permissible by others without the copyright owner’s knowledge or consent.

As Mazonne explains: “Copyfraud is exacerbated when owners of valid copyrights interfere with lawful de minimis copying and fair use and thereby impose restrictions beyond what the law allows. These actions deter even limited reproduction of falsely marked public domain works, reproduction that would be lawful even if the works were in fact under copyright.”

Another factor behind the prevalence of copyfraud concerns the likelihood of a claim of infringement being challenged. An individual accused of copyright infringement by a large organization may not have the necessary funds and resources to defend themselves in the event of any dispute, which makes it likely that they will capitulate to the demands of the organization.

The fact that copyright law varies between countries, and does not last indefinitely, brings further complications.

Are these cases becoming more complex?

There have been a number of well-publicized cases concerning disputed copyright claims in recent years, and some of these have been particularly complex.

In some of these cases, these complexities can be traced back to the way in which the work was initially published by the creator. Many artists will publish their work on a social media platform or another online portal, and while these platforms will have their own terms around what content may be published, and the license that’s granted to them when this happens, a clash between these and copyright law can create problems – particularly if the person uploading the content is not actually its true copyright holder.

Of course, the ease with which such works can be stolen from these platforms and republished elsewhere only makes the problem worse. Entering images into competitions and not reading the small print around what rights and licenses are assigned to the organizers has also stung many photographers and content owners.

Can a creative work only partly be protected copyright?

Just as it’s entirely possible for an individual to know they do not hold copyright over a piece of work but claim to – and exploit this for financial gain – there are many grey areas around this that can further complicate legal challenges.

It’s not common, but it’s possible for a company or an individual to only own the copyright to part of a published work, one that is generally considered to be a single piece.

One recent example of this – which highlights just how convoluted these kinds of cases can be – concerned the song Happy Birthday to You.

In 1935, musical publisher Summy Co. registered copyright over a number of piano arrangements of the song, and charged licensing fees for those wishing to use it. In 1988, publisher Warner Chappell Music purchased the company and continued to claim licensing fees for the use of the song, which were estimated to reach around $2m per year.

In 2013, a documentary maker filed a legal suit against Warner Chappell, claiming that the copyright the company held only pertained to a piano arrangement of the melody, rather than the song and lyrics in its entirety, and argued that the song was in fact in the public domain.

The presence of the song and lyrics in songbooks published in 1922 and 1927 also preceded the 1935 copyright that was registered by Summy Co. This meant that even if it was originally protected by copyright, this would have since expired.

In the end, a judge ruled that Warner Chappell’s copyright did indeed only cover specific piano arrangements to the melody. The company disagreed, but ended up paying back $14m in licensing fees that it had collected over the years. The song was declared to be in the public domain in the US in 2016, and in the European Union at the start of 2017.

What do NFTs have to do with this?

The recent rise in popularity of non-fungible tokens, or NFTs, has brought more focus on issues surrounding ownership, copyright and potential infringements. But before we examine why, it’s best to look at what an NFT actually is.

Non-fungible tokens detail the ownership of a digital asset of some kind, such as an image, a video, a collectible sports card or a tool used in a video game. “Non-fungible” simply means that the token cannot be replicated – and, therefore, interchanged with another token – because of something unique about it, much in the way that a piece of original art cannot be readily substituted for another.

The token itself resides on a blockchain, which is a public ledger, and this shows that a transaction took place and that there is an owner of this digital asset. In the case of an image, this could be a reproduction of an original image that is in some way unique. Exactly how it’s unique is another matter, although the copyright owner will have verified this in some way. Twitter co-founder Jack Dorsey, for example, recently sold an NFT of his first tweet for $2.9m, and this contained the metadata of the tweet and a certificate signed by him.

It’s important to note that the token is not the original artwork, nor the copyright over the artwork itself. Much in the same way as when you buy a photographic print, you are not buying an original film negative or a raw file, or the copyright to the image itself, but a reproduction of the original work. The specific terms set by the seller or platform on which the NFT is purchased may detail exactly what permissions are included in the sale of the NFT.

All of this means that Jack Dorsey’s tweet still exists as a tweet, and can be embedded by anyone elsewhere. Like here.

Part of the attraction of NFTs is that the blockchain on which they live makes it almost impossible to falsify ownership of the token once it’s recorded here. Blockchain architecture means that any kind of adjustment to the block that contains this transaction would require the falsification of every other block that precedes it. This is difficult as the ledger is publicly distributed, which means a record of the genuine transaction already exists in multiple locations elsewhere.

Another benefit is that the creator of a piece of work that is sold as an NFT can continue to receive a commission every time the NFT is subsequently resold.

But the fact that the creator retains the copyright to the asset itself means that there is no guarantee that another similar work won’t be created and sold in the same way in future. It is, after all, scarcity that gives the token value. And while the purchaser of the NFT may have a unique link that directs them to the asset online, the fact that it’s not the asset itself that’s being sold means that others may still be able to view some kind of copy of it themselves (such as Jack Dorsey’s tweet).

Another issue is that the asset itself is not on the blockchain, only the token is. This means that access to the asset relies upon the site on which it’s hosted staying online.

The issue of copyfraud starts to come into play when the seller of the NFT is not the true holder of the copyright. A similar issue has long been a problem for stock image libraries; their terms may require that anyone uploading images holds the necessary copyright to them, but anyone with access to a high-resolution image that has some kind of appeal to others may still try their luck and submit this in order to profit from any sales.

The difference with NFTs is that although the work itself is not being sold as the NFT – this being little more than a receipt – and copyright is not being assigned to anyone else, someone is still attempting to profit from the sale of an asset related to a creative work protected by copyright.

Whether this in itself would fall under the definition of copyfraud isn’t clear. What’s being sold is not an artwork in itself, but a token that represents it. The reproduction of the original asset linked from the NFT would not be allowed under copyright law if the sole intention was to profit from it, however, and this would go against the terms of any legitimate platform on which it’s sold. So, at the very least, this would likely be an infringement of copyright.

For obvious reasons, the art world has long attracted fraudsters, and there’s little reason to believe that the current craze for NFTs won’t encourage similar behavior. While most NFTs sell for less than $200, some have reached seven- and even eight-figure sums. Assuming a level of interest in NFTs remains, we should expect that claims of theft and related legal challenges will only become more common.



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