Copyright law’s principal justification today is the economic theory of creator incentives. Central to this theory is the recognition that while copyright’s exclusive rights framework provides creators with an economic incentive to create, it also entails large social costs, and that creators therefore need to be given just enough incentive to create in order to balance the system’s benefits against its costs. Yet, none of copyright’s current doctrines enable courts to circumscribe a creator’s entitlement by reference to limitations inherent in the very idea of incentives. While the common law too relies on providing actors with incentives to behave in certain ways, it recognizes that its incentive structure has outer limits and that failing to calibrate an entitlement or liability with these limits in mind is likely to prove inefficient. The principal mechanism that it employs to this end is the concept of foreseeability. Premised on the idea that individuals do not ordinarily consider consequences that are temporally or causally far removed from their actions, foreseeability allows courts to balance a regime’s ex ante incentive effects against its ex post costs when determining liability.
This Article argues that if copyright law is to remain true to its theory of incentives, and thereby the need to balance monopoly control with the social costs that are central to the theory, it needs to internalize the idea that creators, like actors elsewhere, are incapable of fully anticipating all future contingencies associated with their actions, which in turn limits the effectiveness of incentives. To this end, this Article proposes a test of “foreseeable copying” to limit copyright’s grant of exclusivity to situations where a copier’s use was reasonably foreseeable at the time of creation — the point when the incentive is meant to operate. Adopting a test of foreseeability is thus likely to better align copyright law with its underlying purpose and provide courts with a mechanism by which to give effect to copyright’s theory of incentives in individual cases — thereby according the theory more than just rhetorical significance.
Balganesh, Shyamkrishna, "Foreseeability and Copyright Incentives" (2009). Faculty Scholarship at Penn Law. 705.