This is Creator Economy Law, a newsletter dedicated to exploring and analyzing the legal issues surrounding the creator economy, creators, and internet platforms. If you enjoy what you’re reading, share with friends, and invite them to subscribe using the button above and share using #CreatorEconomyLaw.
#GirlDinner… it’s what’s for dinner.
Legal Job Alert. IZEA is hiring an Associate Counsel (remote)! It looks like an awesome opportunity to join a major player in the creator economy space.
Here’s what’s been happening in the world of creator economy law.
Creators x Remix Culture
Creator rights and ownership are called into question as part of a lawsuit filed by Activision that tests the bounds of TikTok‘s remix culture and commercial licensing. Anthony Fantano, creator of the viral “pizza slices” TikTok meme, forced Activision’s hand to file a lawsuit to prove the video game giant didn’t need a license to reuse Original Audio for a commercial purpose.
What is remix culture? Remix culture is a term used to refer to “a society that allows and encourages derivative works by combining or editing existing materials to produce a new creative work or product.”
I first became familiar with the term in the late 2000s following Lawrence Lessig‘s book Remix: Making Art and Commerce Thrive in the Hybrid Economy and the release of the film RiP! A Remix Manifesto. In 2016, the Department of Commerce explored the concept of applying a compulsory license for remixes in the digital economy.
On TikTok specifically, remixing and reusing content both within the platform itself and outside of the platform, has become a large part of our society. Nightcore is one example.
YouTube, Facebook, Instagram, and similar services building upon TikTok’s short-form, derivative content model have presented legal issues for a while, as I discussed earlier this year. YouTube offers the option for creators and channel managers to opt videos out of being “remixed”.
What is a dec judgment? A declaratory judgment is a legal tool that anyone can use to have a judge make a fast-tracked decision on something without having to wait for someone else to file a lawsuit. It’s a tactic common with intellectual property disputes in response to a cease-and-desist letter sent by a rights holder.
Knowing Your Sounds. TikTok offers a couple of different ways to remix user content or add in licensed sounds and music from record labels and music publishers. Activision makes reference to two capabilities of the platform–Commercial Sounds and Commercial Music Library–in its complaint to support its argument that a direct license or other permissions from Fantano were not needed.
TikTok’s Commercial Music Library is touted as cleared music for use on TikTok by its users “for marketing, advertising, sponsorships, endorsements, or publicity, including official brand accounts, their promotional partners and creators, NGOs, and government organizations.” They also add that it can be used for organic and paid content.
On the other hand, “Commercial sounds” is not an actual TikTok offering in the sense of its Commercial Music Library. Instead, the term simply refers to a filter option that enables users to find sounds cleared for commercial use. As noted in the article, this is where any audio tracks appear once a TikTok is posted.
The “Commercial sounds” filter is similar to using Google Image search and filtering based on various license types. The assets offered are still dependent upon user-generated content and their purported ownership and right to license under a broad use type. Anyone can upload a TikTok and claim they have the rights to the audio, but that isn’t always accurate if there is background music, a TV show, or other audio present in the TikTok.
Indemnification for all. Alternatively, creators and brands can license sounds directly from reputable sound libraries or stock asset companies. Reputable in this regard often comes in the form of strong indemnification protection under a license agreement, such as that offered by Getty Images or Pond5.
“Indemnification is a form of compensation that supports a buyer (you) if a copyright claim is made against a purchased asset,” Pond5 explains.
Indemnification can also be included in a contract (such as a sponsorship deal) directly between a brand and a creator to reuse or remix assets of the creator, which offers more protection to the brand than if they pulled the sound or other assets from something like TikTok’s sound library.
Hot and Ready. There is SO much more that I unpack from this lawsuit, so check out the article published on Passionfruit and The Daily Dot for the full scoop!
Q2 2023 Results
- “Spotify Packs on More Premium Subs in Q2 Than Expected to Reach 220 Million, Projects Slower Growth After Price Hikes” via Variety
- Spotify’s Premium subscriber base grew by 10m in Q2 to reach 220m paying users, as reported by Music Business Worldwide.
- “Alphabet reports better-than-expected quarterly results driven by growth in cloud” via CNBC
- “Alphabet reports Q2 2023 revenue of $74.6 billion” via 9to5Google
- “YouTube generated $7.66 billion in ad revenues in Q2, up 4.4% YoY… and more than double what Spotify generated across its entire business in Q2,” reports MusicBusinessWorldwide.
- “Snap Q2 Revenue Declines 4% as Ad Woes Persist, Stock Plummets on Weak Outlook” via Variety
- “Snapchat Rises to 397M Users, Sees More Active Advertisers in Q2” via SocialMediaToday
- “Meta’s Reels revenue narrows in on TikTok, boosted by AI” via Reuters
- “Meta stock surges after earnings as ‘year of efficiency’ pays off” via CNBC
Reminder: you or your brand don’t own your social media handles… 🙄
In some circumstances, a trademark registration may offer ways to prevent uses of your brand in a way that is confusing to consumers
BUT, it isn’t a guarantee that it’ll get you a particular social handle without the person (or company in this X case) misusing it.
Bye, Bye Birdie. Elon Musk has done away with the Twitter brand and bird, launching an 𝕏 brand/logo instead. However, there might be a trademark minefield to overcome given hundreds of registrations for “X” already exist. The move is estimated to wipe out $4 billion to $20 billion in brand value. As noted above, Musk even took the @X handle away from a user.
The company is also allegedly warning companies that they would lose their verified status if they don’t buy more than $1,000 in ads per month, or $6,000 over a 180-day period.
Former Twitter (X) leader Esther Crawford, the one who went viral for sleeping on the floor during the Musk transition, breaks her silence following her layoff in a long-form Tweet and video posted to the platform.
Will Twitter’s meager patent portfolio doom Musk’s hopes of “strictly enforcing” Twitter’s IP rights? Attorney and podcast host Eli Mazour and attorney and IP Columnist for Above the Law Gaston Kroub discuss how an unprecedented IP dispute between two of the world’s richest men might play out on a recent episode of Clause 8.
SocialMediaToday reports on changes to Twitter’s requirements for its creator ad revenue share program that helps creators not lose their earning status if they have down months.
Meta
Whippin’ the LLaMA’s As… Meta and Microsoft (!) unleashed Llama 2 upon the world. It’s a next-generation large language model (LLM). Insider’s Hasan Chowdhury reports on Alibaba’s commercial offering of the model is opening up access to a lot of Chinese companies.
Instagram’s $68.5M Illinois Problem. Illinois has this little regulation called the Biometric Information Privacy Act (BIPA) that’s become a fan-favorite of class action firms. This time around, Instagram settled a lawsuit and established a $68.5 million settlement fund. An Illinois resident that used Instagram at any point between August 10, 2015, through August 16, 2023? You may be entitled to a payment.
Digital Rights Watch, an Australia-based non-profit organization focused on digital rights, is concerned with Threads and what they say is Australia’s “woefully ill-equipped” privacy act.
WhatsApp‘s Privacy Policy update notes a shift to a “Legitimate Interest” legal basis for processing the personal data of EU citizens, as noted by Iubenda.
Artificial Intelligence
Apple is reportedly testing a generative AI chatbot, referred to internally as Apple GPT.
Stability AI and its CarperAI lab announced FreeWilly1 and its successor FreeWilly2, two new LLMs, powered in part by Meta’s LLaMA foundational model, available under a CC BY-NC-4.0 license on Hugging Face. Read the full press release.
President Joe Biden convened seven leading AI companies at the White House on July 21 – Amazon, Anthropic, Google, Inflection, Meta, Microsoft, and OpenAI – to announce that the Biden-Harris Administration has secured voluntary commitments from these companies to help move toward safe, secure, and transparent development of AI technology. Apple was not present. Bill Rosenblatt published a great overview in Forbes of digital watermarking and whether or not it is a workable solution.
In connection with the event, Microsoft announced a new set of commitments to advance safe, secure, and trustworthy AI, as further explained in a blog post by Vice Chair & President Brad Smith. However, critics argue that big tech companies shouldn’t be at the center of the conversation.
On July 25, the U.S. Senate Committee on the Judiciary held a subcommittee meeting on “Oversight of AI: Principles for Regulation“. The meeting included testimony from Stuart Russell, Professor of Computer Science at UC Berkeley, Yoshua Bengio, Founder and Scientific Director of Mila – Québec AI Institute and Professor in the Department of Computer Science and Operations Research at Université de Montréal, and Dario Amodei, CEO of Anthropic.
Ryan Heath writes for Axios about Senate Majority Leader Chuck Schumer‘s plans for a series of nine “AI Insight Forums” later this year.
TikTok is planning an online marketplace launch in the U.S. for August, riveling Amazon and Walmart as potential shopping destinations.
Other News
“Rather than an anomaly, the company and its collapse are the inevitable byproducts of a business model built on false assumptions.”
“How Vice Media Went Bankrupt” by Mark Stenberg via AdWeek. Read on Apple News.
The New York Times’s DealBook reported on Monday a potential sale exploration of cable news network Cheddar News by owner Altice following its 2019 acquisition for $200 million.
Sen. Chris Murphy (Conn) writes an opinion piece in The New York Times, “Algorithms Are Making Kids Desperately Unhappy”.
Does the Mechanical Licensing Collective (The MLC) have a massive chest of unmatched/unclaimed royalties? That’s what songwriter organizations around the world are claiming in a letter sent to U.S. Rep. Darrell Issa earlier this month.
TorrentFreak reports on a notice of appeal filed in the Fourth Circuit by YouTube ripping platforms FLVTO.biz and 2conv.com and the Russian operator Tofig Kurbanov. in an apparent move to continue the battle over the RIAA‘s $83 million award in 2021 stemming from piracy claims.
The Securities and Exchange Commission (SEC) adopted rules requiring registrants to disclose material cybersecurity incidents they experience and to disclose on an annual basis material information regarding their cybersecurity risk management, strategy, and governance. The Commission also adopted rules requiring foreign private issuers to make comparable disclosures.
The Federal Trade Commission (FTC) is seeking comment on an application from the Entertainment Software Rating Board (ESRB), digital identity company Yoti, and parental verification company SuperAwesome for a new mechanism for obtaining parental consent under the Children’s Online Privacy Protection Act (COPPA) Rule. The ESRB currently operates under a COPPA safe harbor program but now the companies are requesting approval for the use of “Privacy-Protective Facial Age Estimation” technology, which analyzes the geometry of a user’s face to confirm that they are an adult.
Bloomberg explores the downfall of vegan food company Daily Harvest‘s work with influencers that resulted in many getting sick.
Moderating Reddit. Reddit’s been dealing with a moderator problem in response to its decision to convert its developer API offerings into a high-cost, productized business model (thanks, Elon). 9to5Mac offers a great rundown of the issues, and how some communities are migrating to Discord.
Actors are using social media to virtually join the picket line by sharing screenshots and videos discussing their residuals pay, or in some cases lack thereof. NPR’s Ayana Archie has a wonderful story covering it all.
A study published on July 24 by the Stanford Internet Observatory‘s Cyber Policy Center explored “Child Safety on Federated Social Media”. Engadget’s Peter Cao provides all the key takeaways in “Mastodon’s decentralized social network has a major CSAM problem.”
An antitrust agency in France is launching an investigation into Apple‘s App Tracking Transparency program. Meanwhile, Apple is also facing a $1 billion lawsuit in the UK from developers over its App Store commissions which range from 15% to 30%.
Apple, Meta, and Google are appealing a 2022 ruling that held Section 230 of the CDA did not prevent the app distributors from being classified as “bookies” by distributing virtual casino game apps and collecting a commission on the in-app purchases.
TikTok is cracking down on creators that promote drugs that can be used for weight loss, such as Ozempic, as Tubefilter reports.
The Senate Commerce Committee moved forward both the Children and Teens’ Online Privacy Protection Act (known as COPPA 2.0) and the Kids Online Safety Act (KOSA). As reported by CyberScoop’s Tonya Riley, “While the odds of the bill making it to the president’s desk are slim, they have his support.” NetChoice’s Chris Marchese also breaks it all down on Twitter.
Brendan Gahan and Keith Bendes dropped a fantastic interview with Taylor Lorenz, a reporter with The Washington Post and author of the forthcoming book Extremely Online: The Untold Story of Fame, Influence, and Power on the Internet (I’ve pre-ordered my copy already!).
Generative AI Week in Atlanta, GA
I’m so excited to be joining Scott Sholder on stage to present at the first state-side Generative AI Week event in Atlanta, GA! I’ve heard rumors that it’s a not-to-be-missed event after a successful run in London earlier this year. Plus, if May Habib says it’s stellar, then it’s going to be worth it!
The programming and speaker lineup is also super impressive! This is the only event dedicated to providing practical steps for implementing & scaling Generative AI efforts across the enterprise, with 50+ speakers from some of the most forward-thinking companies sharing use cases, insights, and challenges on their Generative AI adoption.
As a speaker, I can share the 10% off code “SPEAKER10” that you can use to register. Use this link to have it automatically apply, or just to check things out.
Are you going? Let us know in the comments and maybe we can organize a meet-up!Shout out to Mhairi Macbride for the great work organizing everything!
In-House Counsel and Social Media
Have you been wanting to discuss social media and IP? You know I have been! 😄 Join me at #ACCAM23 in October!I’m speaking on part 1 of a two-part panel series that explores intellectual property considerations within the context of social media… just for in-house counsel!
Learn more about the Association of Corporate Counsel‘s Annual Meeting, October 22-25, 2023, in San Antonio, TX, by visiting: https://am.acc.com
It’s going to be fun! 🥳
Creative block happens. It’s always refreshing to hear that other creators, no matter how major or independent, are dealing with their own blockers.
On Apple Music, Zane Lowe interviews Billie Eilish about how Barbie and the film’s director Greta Gerwig pulled her and her brother (FINNEAS), and co-writer on the track, out of a writer’s block for What Was I Made For?.
Watch on YouTube or Apple Music.
Affiliate Links. As an Amazon Associate, I earn from qualifying purchases. I have noted above where links to products on Amazon may earn me a commission if you make a purchase. Thanks for supporting my work!
Not Legal Advice. This newsletter is published solely for educational and entertainment value. Nothing in this newsletter should be considered legal advice. If you need legal assistance or have specific questions, you should consult a licensed attorney in your jurisdiction. I am not your attorney. Do not share any information in the comments you should keep confidential.
Personal Opinions. The opinions and thoughts shared in this newsletter are my own, and not those of my employer or any of the third parties mentioned or linked to in this newsletter. No affiliation or endorsement is implied or otherwise intended with third parties that are referenced or linked.
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