This decision granted a motion by intervenor the United States to reconsider a motion to dismiss granted on December 21, 2004, in the United States District Court for the Central District of California by the late Judge William Rea. Plaintiffs' claim that defendants violated 17 USC § 1101(a)(3), an anti-bootlegging statute (“the Statute”) with no durational limit on its protection, had been dismissed because the court found that the statute was “copyright-like” and therefore unconstitutional because it violated the "for limited Times" requirement of the Copyright Clause of the Constitution. By way of background, “’[b]ootlegging’ is ‘the making of an unauthorized copy of a commercially unreleased performance,’ and is distinct from ‘piracy,’ which is an unauthorized duplication of an authorized recording.” Moghadam, 175 F.3d at 1272 n.3 (citation and internal quotation marks omitted). The Court granted the motion to reconsider because it found proper Constitutional authorization for the statute in the Commerce Clause, and, since the statute is authorized by another part of the Constitution, there is no need for this admittedly "copyright-like" statute to conform to the "limited Times" requirement of the Copyright Clause. The Court vacated the previous order finding the statute unconstitutional and denied defendants' motion to dismiss the claim based on the anti-bootlegging statute.In this decision affirming the statute's constitutionality, the Court relied on the research and reasoning provided in two conflicting opinions from other jurisdictions concerning a related criminal statute, United States v. Moghadam, 175 F.3d 1269 (11th Cir. 1999) and United States v. Martignon, 346 F. Supp. 2d 413 (S.D.N.Y. 2004). Moghadam found the criminal anti-bootlegging statute constitutional, while Martignon found the criminal anti-bootlegging statute unconstitutional. The Court organized its analysis into two separate questions: "(a) did Congress have the power to enact the anti-bootlegging legislation? and (b) if so, is the legislation ‘fundamentally inconsistent’ with the Copyright Clause?”
(a) Did Congress have power to enact the anti-bootlegging legislation?
Judge Rea based his order on a theory that the anti-bootlegging statute proceeded from the Copyright Clause and ruled that the Statute did not incorporate the duration of copyright protection from another federal statute, 17 USC § 302. All parties in this proceeding agreed that the relevant constitutional durational limit was not incorporated into the Statute, and thus "the limited Times" requirement of the Copyright Clause was not satisfied.
Following Moghadam, the Court found it unlikely that Congress drew their power to enact the Statute from the Copyright Clause, in part because the legislative history of the Statute is unclear. Because the Statute governs live performances, the Court found these unfixed, intangible works to be outside the purview of the Copyright Clause's protection of "Writings."
The Court then sought other Constitutional authorization for the Statute. The Court sought this authorization because it followed an interpretive framework that would invalidate the Statute “only upon a plain showing that Congress has exceeded its constitutional bounds.” United States v. Morrison, 529 U.S. 598, 607 (2000). The Court found that the Commerce Clause grants this authority, noting that the Commerce Clause "has been interpreted broadly in the modern era," even in an illegal market like bootlegging. Gonzales v. Raich, 125 S. Cy. 2195 (2005). Here, the Court, relying again on Moghadam, found a strong link between bootleg compact discs and both interstate and international commerce as bootleggers "depress the legitimate markets because demand is satisfied through unauthorized channels." Moghadam, 175 F.3d at 1276. The Court also found a connection to the international elements of the Commerce Clause because § 1101 was enacted in relation to an international treaty of the World Trade Organization.
In a footnote, the Court noted that the Necessary and Proper clause would probably "even more clearly provide a constitutional source for the Statute,” but stated that it need not reach this issue.
(b) Is the legislation "fundamentally inconsistent" with the Copyright Clause?
The Court noted that an analysis of the anti-bootlegging statute could end with a finding of its constitutionality under the Commerce Clause, because "the various grants of legislative authority contained in the Constitution stand alone and must be independently analyzed." Moghadam, 175 F.3d at 1277 (citing Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 85 S. Ct. 348, 13 L. Ed. 2d 258 (1964), and The Trade-Mark Cases, 100 U.S. 82, 25 L. Ed. 550, 1879 Dec. Comm'r Pat. 619 (1879)). However, Martignon held that the criminal anti-bootlegging statute was "copyright-like" and that if it was not allowed under the Copyright Clause, no separate grant of power allowed Congress to enact it. 346 F. Supp. 2d at 424-25. The Court chose to part ways with Martignon and Judge Rea’s order, and noted that Martignon "provides no authority for this conclusion."
Instead, the Court held that "nothing prohibits Congress from protecting similar things in different ways" and that there is no requirement of "uniformity of regulation." The Court analogized this situation to The Trade-Mark Cases that similarly noted that legislation could be allowed under the Commerce Clause that would not be permitted under the Copyright Clause. See 100 U.S. 82, 94-96. The Court held that the "copyright-like" nature of the Statute does not import any of the restrictions of the Copyright Clause into the Commerce Clause. Instead, the Statute "need only find an alternative source of constitutional authority."
The Court then noted that Judge Rea's order was flawed because it sought an interpretation of the Statute that rendered it unconstitutional. Judge Rea, following Martignon, focused entirely on the "primary purpose" of the Statute’s copyright-like nature to compel a reading of it under the Copyright Clause. The Court found no reason for this emphasis on the “primary purpose” of the Statute. Instead, Judge Rea should have given “sufficient deference to the fundamental premise that legislation is presumed to be constitutional” and interpreted the Statute as constitutional under the Commerce Clause. See Morrison, 529 U.S. at 607. The Court then followed Moghadam and found that the protection afforded to "Writings" in the Copyright Clause does not forestall protection of other works of authorship. 175 F.3d at 1280. The Court also noted Raymond Nimmer’s criticism of Judge Rea's finding of unconstitutionality because it created an unwarranted hierarchy between the Copyright and Commerce Clauses. 1 Raymond T. Nimmer, Information Law § 6:30 (2005).
The Court concluded that the Statute serves as a complement to the Copyright Clause because it "merely proscribes conduct not otherwise addressed, prohibited or protected by the Copyright Clause." The Court summarized this holding by noting that it does not "stretch the presumption of constitutionality to conclude that legislation that prevents dissemination in perpetuity of an unauthorized videotape by a third-party of a live performance does not conflict with a clause that protects, 'for limited Times,' the voluntarily disseminated 'Writings' of authors."