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Cyber Law – Lecture 5

@guidonld

Blockchain essentials and

music copyright

Dr Guido Noto La Diega

Blockchain: the context
PART 1

© Guido Noto La Diega 3

NIST definitions
• Blockchains are distributed digital ledgers of cryptographically signed transactions that
are grouped into blocks. Each block is cryptographically linked to the previous one
(making it tamper evident) after validation and undergoing a consensus decision. As new
blocks are added, older blocks become more difficult to modify (creating tamper
resistance). New blocks are replicated across copies of the ledger within the network,
and any conflicts are resolved automatically using established rules.
• Permissioned: a system where every node, and every user must be granted permissions to utilize
the system (generally assigned by an administrator or consortium).
• Permissionless: a system where all users’ permissions are equal and not set by any administrator
or consortium.
• Smart contract: A collection of code and data (sometimes referred to as functions and
state) that is deployed using cryptographically signed transactions on the blockchain
network. The smart contract is executed by nodes within the blockchain network; all
nodes must derive the same results for the execution, and the results of execution are
recorded on the blockchain.
• See more at https://nvlpubs.nist.gov/nistpubs/ir/2018/NIST.IR.8202.pdf
© Guido Noto La Diega 6
Bitcoin ⊆ blockchain ⊆ distributed ledger
Bitcoin

Blockchain

Distributed
ledger
technologies

© Guido Noto La Diega 7

Features lawyers should keep in mind

• DLT are inherently resistant to modification of the data (link to previous

block + timestamp + transaction).
• Open, distributed ledger
• Verifiability
• Consensus
• Trust
• Peer-to-peer
• Unbreakability

© Guido Noto La Diega 8

Structure

• Registration

• Attribution

• Infringement

• Commercial transactions

© Guido Noto La Diega 9

Copyright registration

© Guido Noto La Diega 10

The death (and rebirth) of registration

• Berne Convention for the Protection of Literary and Artistic Works 1886
• Copyright must be automatic (fixation)
• Prohibited to require formal registration
• BUT the US make statutory damages and attorney's fees only available for
registered works
• Elsewhere, evidence problem, particularly when no tangible medium (e.g.
eBooks)

© Guido Noto La Diega 11

DLT-enabled registration

• A DLT platform could issue a token, serving as proof of authenticity, in

which a timestamped copyright registration is contained

• Once that token has been issued to a certain person, it can only be
transferred to someone else when the owner signs off on the
transaction with their private key

• Registration of both digital and physical content (На базе Росреестра

в Москве пройдет пилотный блокчейн-проект)

© Guido Noto La Diega 12

Benefits of the DLT-enabled registration
• Transparency in terms of copyright registration can help content creators to
exert copyright claims once they see their work being used without their
consent
• Issued tokens can be viewed by anyone, and the timestamp will indicate
whether or not a copyright registration was in place at the time the
infringing content was made available

• DLT registration is cheaper and more user-friendly

• No censorship

© Guido Noto La Diega 13

Copyright
attribution

© Guido Noto La Diega 14

Attribution

• UK Government Chief Scientific Adviser 2016: “In a market with a

relatively high level of paper forgery, (DLT) make attribution more
efficient”
• Sharing society: hard to keep track of the use of your pictures, posts,
etc.
• Tens of millions in royalties get lost cause Youtube, Spotify, etc. don’t
know who owns the rights
• Melissa Ferrick et al v. Spotify USA Inc., et al, No. 1:2016cv08412 - Document 418
(S.D.N.Y. 2018)
• Moral rights (waivers) art. 1228(2) Russian Civil Code

© Guido Noto La Diega 15

The credits conundrum
• Music collaboration songwriters, singers, musicians, etc. Who’s Chris Dave?
• Vinyl records and CDs paradise of behind-the-scenes talent
• Many corporations tight grip on music metadata
• Info about who did what is fragmented between a large number of
databases that don’t sync with each other + owners conflicting views about
public & private
• A decentralised, open-source global platform, owned and controlled by no
single entity could contain accurate, real-time, global data encompassing
credits and rights ownership

© Guido Noto La Diega 16

Copyright infringement

© Guido Noto La Diega 17

An ambiguous relationship
• DLT can help counter infringement because
• Transparent
• easier to know who’s the © holder
• easier paying the royalties
• “a permanent, public, transparent ledger system for compiling data
on sales, storing rights data by authenticating copyright registration
and tracking digital use and payments to content creators” (Buntinx
2015)

• But lend themselves also to infringing uses…

© Guido Noto La Diega 18

Distributed infringement
• “Blockchain technology will revolutionize file sharing via censorship resistance”
(spacetraderinspace 2017)
• Several projects happening in crypto world (Sia, Storj, IPFS, etc.)
• Decentralized dropbox, encrypted data streams, sharded data fragments are all
happening without central point of failure making take downs virtually
impossible
• Censorship resistance of DLT via decentralisation may make file sharing
impossible to control by anyone for any reason.

© Guido Noto La Diega 19

Commercial transactions
Smart contracts for IP licensing
• A smart contract is a computerized transaction protocol that executes the
terms of a contract (Szabo 1994)
• Hackers exploited a bug in the code, the DAO’s coders implemented a hard
fork to recover $55 million: breach of smart contract?
• Human contracting enables cooperation and healp spread trust
• Its social good is promoted by possibility of contract being broken (efficient
breach: no punitive, no specific performance)
• 20th century's greatest philosopher of science Popper, Unended Quest:
‘if God had wanted to put everything into the world from the beginning, He
would have created a universe without change, without organisms and
evolution, and without man and man's experience of change. But He seems
to have thought that a live universe with events unexpected even by
Himself would be more interesting than a dead one.’