Book Review: Peñalver & Katyal’s Property Outlaws

Eduardo M. Peñalver & Sonia K. Katyal, Property Outlaws: How Squatters, Pirates, and Protesters Improve the Law of Ownership (Yale University Press 2010).

As they open one of the late chapters in their Property Outlaws, Eduardo Moisés Peñalver and Sonia K. Katyal speak of a “conflicting divergence” in intellectual property law: “is a pirate an outlaw or a freedom fighter? The law asks, unable to offer a comprehensive answer” (212).  Property Outlaws is an ambitious and rigorously argued explanation of why this ambiguity is a good thing.  The book also responds to a pressing problem.  Intellectual property law, as it is currently developing under intense pressure by property owners, is moving rapidly toward the “outlaw” answer, and in this development, Peñalver and Katyal see cause for concern.  It is not, as they emphasize, that all acts of trespass are good things, or that most of the college students on Bit Torrent have any ideal in mind more elevated than seeing movies for free.  It’s that, when one takes a step back and looks at the development of property law more generally, “property outlaws” have served a very important social function in pushing property law, which tends to ossify, in the direction of needed reforms that reflect shifting social norms, pressing issues of social justice, or other normatively important concerns.  To illustrate this larger point, they embed a discussion of the development of intellectual property law in an innovative account of the social dynamics of property law more generally.

Property Outlaws thus makes the descriptive and normative case for what one might call a dialectical understanding of the development of property.  Specifically, “the apparent stability and order provided by property law owes much to the destabilizing role of the lawbreaker in occasionally forcing needed reform and in generating a series of important legal shifts along the way” (11).  The descriptive case is met by showing a series of examples where deliberate disobedience of property regimes has been a significant catalyst in generating legal reform.  Peñalver and Katyal identify two kinds of property outlaw.  The first, the “expressive” outlaw, acts to protest the current legal system, but not to obtain property for herself.  The protestors of the Greensboro lunch counter sit-ins, whose trespassing was a major catalyst to the civil rights movement, were paradigmatic expressive outlaws.  The second, “acquisitive” outlaw violates others’ property rights, and expects to gain personally.  The case for acquisitive outlaws is harder to make because of their “profit motive,” but urban squatters in developing countries seem both to have available a necessity defense and to point to a widespread social justice problem.

The situation with intellectual property law is somewhat different, because IP law is considerably less specific than real property law: not only is the domain of the entitlement more ambiguous (which parts of the work are copyrighted?), but so is its scope (is that fair use?).  Peñalver and Katyal thus propose that intellectual property violators can sometimes be seen as outlaws, but sometimes as “altlaws,” whose “conduct at least arguably falls within the boundaries of legality and, at the same time, who do[] not reject out of hand the concept of intellectual property” (77).  Citing Robert Cover, Peñalver and Katyal propose that the altlaw is engaged in an attempt to “convert legal interpretation into legal meaning,” i.e., to get the law to recognize her interpretation as correct.  Altlaws can also be expressive or acquisitive.  An example of the former is the Swarthmore students who defied cease and desist letters to publicize embarrassing internal documents that cast serious doubt on the integrity of Diebold’s voting machines.  An example of the latter is the revolt in several developing countries against the high prices for AIDS anti-retroviral drugs.  Despite apocalyptic warnings from the pharmaceutical industry, those countries insist they respect patent rights generally, and that they are using existing TRIPS provisions to obtain lifesaving medicines in the face of a public health catastrophe.

Peñalver and Katyal are not just interested in the fact of property outlaws.  They are also interested in showing that “certain categories of property outlaws are less culpable … than ordinary criminals” (126).  From a utilitarian perspective, not all outlaw behavior should be deterred, because property outlaws can generate socially useful information (that many individuals find a property regime unjust) and useful redistribution (as, for example, in cases of adverse possession).  Deontologically, property outlaws can seem less culpable than other kinds of criminals both because their behavior does not directly injure other people, and because breaking unjust laws is at least less blameworthy than breaking other laws, if not justified outright.  These arguments apply most easily to expressive outlaws, since they do not intend to gain personally from their actions.  But even in the case of acquisitive outlaws, there are good reasons to extend necessity defenses and to excuse or limit culpability for “self-help beyond the extreme case of, say, immanent starvation” (136).

None of this is to say that outlaw behavior should be legalized: not only is maintaining the property system itself important, but expressive outlaw behavior would lose its expressive value if it were legalized (139).  Rather, the point is to notice that legislative responses to outlaw behavior tend to try to stamp it out by ratcheting up penalties.  However, against a normative background urging reduced culpability, that approach is at least sometimes exactly backwards: greater social benefit would be obtained by “ratify[ing] widespread property disobedience through targeted legal accommodation” (145).  To be sure, such accommodation is not always socially optimal – in the case of a highly unjust property distribution, changes in the tax code are generally more efficient than legal rules – but that does not mean that legal accommodation is worse than the status quo.

Peñalver and Katyal devote the last section of the book to responses to intellectual property outlaws.  Here, one might think, the case for targeted accommodation might be strongest: intellectual property is legally underspecified compared to real property; the IP system has always included specific provisions (limited durations, fair use, etc.) for the public good; and property altlaws can in any case colorably claim to be upholding the law, not violating it, and so fears of a general decline in respect for the law seem most distant.  Unfortunately, the tendency in IP law is the opposite: to so severely penalize behavior found to be illegal that no rational agent could risk such a result.  Property owners correctly claim that technology has made infringement easier, but Peñalver and Katyal remind us that it has also made enforcement easier by allowing continual surveillance of infringing actions and by enabling various digital rights management schemes that make copying against the owner’s wishes physically difficult.  These combine with legal developments, such as a general prohibition on technologies that break copy protection schemes (§1201 of the DMCA) and a decline in the availability of fair use defenses.  Meanwhile, intellectual property owners frequently overclaim both the scope and domain of their rights and launch public relations campaigns that declare all those who act against their wishes “pirates.”  These factors add up.  For example, even traditional fair use defenses become difficult to muster because of the very high cost not just of losing, but of litigating.  Peñalver and Katyal thus propose to reduce the stakes for those claiming fair use by reducing penalties for copyright violation, and by penalizing property owners for overclaims, as for example by resuscitating such doctrines as copyright misuse..

Property Outlaws thus both makes a substantial intervention in property theory, and proposes a series of practical interventions to better calibrate the legal regime to appropriate the benefits of property outlaw behavior.  In the remainder of this review, I’d like to remark briefly on three implications of their work.  First, in mounting a defense of the property outlaw, Peñalver and Katyal will no doubt be accused of anarchism and encouraging disrespect for the law.  This accusation will be completely unjust.  They are acutely aware of the treacherous terrain they are negotiating; they note that property law is already regarded as more violable than other forms of law (30-2); and they are very careful to point out that accommodations for outlaws should be both targeted and limited.  Indeed, they specifically bracket from consideration the arguments of those who would do away with intellectual property entirely (89).  They also note that outlaw behavior, in its own way, affirms the rule of law: protestors accept and even plan on being arrested (141-2).  More broadly, Peñalver and Katyal argue that property regimes tend to be too stable, lagging behind social norms, and that the status quo, with its overclaimed intellectual property rights, itself ends up undermining respect for the law: “excessive assertions of ownership can end up being self-defeating insofar as they undermine the public’s identification with property norms and increase the public’s tendency to identify with opponents of those norms” (181).  In other words, respect for IP law is declining now; targeted accommodations of outlaws are better than allowing that decline to continue.

Second, many of the stories that Peñalver and Katyal tell will be familiar, particularly to those who work in property law and theory – the Greensboro lunch counter sit-ins, developing nations’ pushback against the high price of anti-retroviral drugs, the efforts to publicize flaws in Diebold’s voting machines, the legal case against for linking to code that bypassed the DVD copy control system, and others of their examples – are all well-known.  This, however, is the point.  Peñalver and Katyal tell these stories well, and by telling them all in the same book, they present a compelling picture that something is not right in the law’s approach to IP outlaws, and especially not in its approach to IP altlaws.  Most people intuitively think the Greensboro protesters got something right.  If their behavior is analogous to that of IP outlaws or altlaws, then our intuitions about IP out/altlaws may need to be reset.  In other words, the book performs useful rhetorical labor in that it pushes back against the universal application of the “pirate” label.  This pushback also performs useful argumentative work; if one is to treat like cases alike, then it matters a lot whether a fair use defendant is more like a lunch counter protestor or a high seas pirate.  Sometimes the defendant will be a pirate.  But not always.

Finally, Peñalver and Katyal devote a few pages near the end of their text to the proposed Google Books settlement, which “is, in many ways, the worst of all possible worlds” (205).  By abandoning fair use claims and instead licensing orphan works, “Google ratifies the content owners’ most expansive proprietary claims.” (205).  Google then gets a monopoly license, which is extended by the magic of class action to all orphan works whose owners don’t opt-out in time.  Of course, since the works in question are orphan, it is highly unlikely that very many owners will show up to opt-out.  Google thus ends up with a de facto monopoly license, a state of affairs that Peñalver and Katyal argue derives directly from “the absence of a doctrine like abandonment in copyright to provide a clear and safe harbor to downstream appropriators of unused and apparently unwanted intellectual property” (206).  Whatever the ultimate merits of their argument, this is a good example of the sorts of policy-thinking enabled by Property Outlaws.  On the face of it, the Google settlement appears to enable public access to works while preserving the rule of law.  However, a statutory protection for the property outlaw who can claim that the work(s) in question were abandoned and ought to revert to the public domain might do a better job of serving the values that the rule of law purports to uphold.


Gordon Hull is a professor of philosophy at the University of North Carolina Charlotte.

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