Social basis for copyleft infringement damages and future regulatory violation fines

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Copyright infringement damages worldwide are usually based on ‘actual’ lost sales or infringer profits. In some jurisdictions, such as the U.S., statutory damages may be available. Patent infringement damages are conceptually similar: lost profits or royalties as if patent license had been purchased.

These kinds of damages disfavor copyleft enforcement, especially by non-profits, as there often are no sales that would have been made in absence of the violation, and where the work in question is general purpose, such as operating system software, the violator’s products will often not be in the same market as the enforcer’s, making losses to competition irrelevant.

In more general terms, it’s hard to show decreased producer surplus due to copyleft violation. But the intention of copyleft isn’t to obtain producer surplus, but to protect user freedom. We could try to attach consumer surplus losses to copyleft violation; such would probably intersect with user freedom losses. It would probably be better to try to calculate social welfare losses due to copyleft violation; these would be a superset of losses to user freedom and consumer surplus.

This gets us to a small commons-favoring reform: in case an infringement involves a free/libre/open licenses, add an option for damages to be based on social welfare losses.

This entails a method of calculating social welfare losses, surely a difficult thing, and one that potential copyleft violators would attempt to minimize. However, the benefits of this calculation go far beyond a hypothetical damages option: if the calculation exists, it can also be used to characterize the social welfare value of free software and other commons-based knowledge production, a daunting problem. Perhaps tackling the problem in the frame of calculating damages would help make it less daunting? Note the dual purpose of calculating damages and characterizing social welfare value would make both copyleft advocates and more broadly free/open advocates think big about the value of commons-based production.

A social basis for copyleft violation damages would also help copyleft serve as a prototype for and bridge to more effective regulation: the same damage calculation would serve as a natural starting place for regulatory violation fines.

I hope that this has been thought of before, would appreciate pointers. I suspect it has not been, due to the handful of people interested in copyleft enforcement being narrowly focused on what can be done without any legal changes, and people interested in legal changes seeing copyleft and as a sideshow at best, not a prototype for public policy reform.

This idea is one of many for reforming policy and reforming policy reform proposals to be commons-favoring, more and more formal writeups forthcoming. Two postings intersected to prompt me to jot this idea down today: @mcgrof on calculating ethical attributes of free software (forming a component of social welfare, if not equivalent to) and an episode of Free as in Freedom mostly concerning copyleft enforcement in which the hosts mention that non-profit copyleft enforcement typically results in a net financial loss, in part because damages are designed for proprietary and for-profit enforcement.