Corporations, CDs and Click Thru Licensing Loopholes?

oh the irony! asks: "The way the current legal/political/economic climate favors corporations and industry associations like the MPAA and RIAA in questions of intellectual property and copyright troubles me. But it has occurred to me that these tools could be used against the RIAA etc. The RIAA says peer to peer services like Napster were illegal because one person buys a CD and rips it so that a person who doesn't own it can listen to it. So...what if a Corporation buys a CD? Specifically, a corporation is legally a person and can own intellectual property as well as other property. If people are members of a corporation they can then legally use the corporation's property. I am not a lawyer but maybe Slashdot readers could tell me if my idea is legally possible or workable. It would be poetic justice to use Click through licenses and corporate law against the bad guys." Read on for more details on "The Idea".

"What if there was a peer to peer service that had a click through license of some sort that made each user a member of the corporation. The user uploads a CD and it becomes property of the corporation. The user retains the original CD as a distributed back up for the corporation. In return for this service (providing a safe place to store the physical CD, using their harddrive space to store backup copies, using the user's bandwidth to distribute these backups to be backed up etc.) the corporation lets the users occasionally listen to that music and other music the corporation owns as a form of payment.

Users are not receiving a service (downloadable music) they are providing a service (storing digital music for a corporation). They are employees of the corporation that get paid by the right to listen to the music.

This would only work if corporation was non-profit and decentralized, a co-operative of some kind without any ability to have control taken of it by someone who would then try to collect its property (the CD's)."

Doesn't really work

[WolfWithoutAClause]

Certainly corporations can own CDs; so that much is correct atleast.

However, if the corporation owns a copy of a CD, then only one person can listen at once, otherwise it becomes a 'performance', which you haven't bought the rights to when you buy a CD. However if you only allow one person to listen then that may be ok (but then you're talking about a library copy- IRC there may be different terms for those.)

Secondly, you can't deploy it across the organisation, say with P2P; because you don't have a license to do that- that would be a copy, and the copyright holder has a monopoly on allowing people to do that.

IANAL

Some legal problems

[Twylite]

Nice idea, but it won't work. You are up against two legal problems: an employee and an employer are separate people; and the employment relationship is a non-trivial contract.

You are right in saying that corporations are juristic persons and can own property. Many corporations own licenses for software, for example. But to allow employees to use those licenses, the license must be assigned to a specific employee.

This is still a legal minefield: some licenses have conditions regarding assignment to other persons, duration of assignment, or even assignment to an instrument (a particular computer). It is generally recognised that an employer has the right to assign property to an employee for use in the course of his/her job, and to reassign that property as dictated by operational requirements. This constitutes fair use on the part of the purchaser.

But fair use and assignment do not give the employer the right to allow unrestricted or simultaneous use of intellectual property that is not owned by the employer (i.e. IP that has been purchased, such as a book, CD, or software).

The same is true for members of corporations -- the relationship between the corporation and a member is still a relationship between different persons having legal status, so a right afforded to a corporation does not necessarily extend to a member of that corporation.

The second problem regards the incorporation or employment. To say the least, a click-through "I agree to be employed" is not sufficient. No court will find that the contract of employment is valid unless the employer is clearly employing, and the employee is being employed and remunerated. While the latter may be true in this case, the former is not satisfied. Similarly the incorporation of a company does not occur on an ad-hoc basis; there are legal procedures that must be followed to introduce members.

Even then, you have to contend with the fact that may people in IT have contracts that prevent them from having other jobs at the same time ... not to mention that this practice is questionable under common law.

Any scheme of this nature ultimately comes down to being some sort of (non-sanctioned) library, and therefore illegal under the basic provisions of copyright. Even if you DID find a way to do it, the courts would also certainly find that you are attempting to circumvent the law, and respond appropriately.