User:Louis/Alliance for Automotive Innovation and Section 1201

At the April 18, 2024 Section 1201 hearing on proposed Class 7, Alliance for Automotive Innovation counsel Mark Humphrey argued that an exemption for vehicle telematics data was unnecessary because the auto industry had already made that data available through the 2014 Memorandum of Understanding and the 2023 Data-Sharing Commitment. Auto Care Association counsel Lisa Foshee testified that the 2014 MOU exempts telematics data on its own terms, the 2023 commitment is voluntary and was signed by only two aftermarket groups plus the Alliance itself, and six automakers told the GAO they give their own dealerships no telematics access at all. On October 28, 2024, six months after the hearing, the Copyright Office granted the Class 7 exemption it had been told was unnecessary, codified at 37 CFR 201.40(b)(14).

The Alliance for Automotive Innovation (also styled Auto Innovators or AAI) is the trade association representing most automakers selling in the United States.

Background: Section 1201 and the vehicle-repair exemption

DMCA Section 1201 of the Digital Millennium Copyright Act makes it unlawful to circumvent a technological protection measure that controls access to a copyrighted work, including the software embedded in a modern vehicle. Every three years the Copyright Office runs a rulemaking that can grant temporary exemptions, codified at 37 CFR 201.40.

Motorized-land-vehicle repair first won an exemption in the Sixth Triennial rulemaking on October 28, 2015. That rule expressly excluded telematics. It covered Computer programs that are contained in and control the functioning of a motorized land vehicle ... except for computer programs primarily designed for the control of telematics or entertainment systems for such vehicle, when circumvention is a necessary step undertaken by the authorized owner of the vehicle to allow the diagnosis, repair or lawful modification of a vehicle function.

The Seventh Triennial rule of October 26, 2018 renewed the exemption. The explicit telematics or entertainment systems exclusion clause no longer appears in the renewed text, authorized owner became lawfully acquired, and a separate-subscription-service condition was added. The Eighth Triennial rule of October 28, 2021 renewed it again, added vessel language throughout, and kept the scope tied to repair, diagnosis, or modification of a vehicle or vessel function rather than a standalone data-access right.

The Ninth Triennial cycle is the one that includes the April 18, 2024 Class 7 hearing. The final rule issued on October 28, 2024, after the hearing. It renewed the existing repair exemption, now at 37 CFR 201.40(b)(13), and granted proposed Class 7 as a separate new exemption at 37 CFR 201.40(b)(14), allowing owners and lessees or those acting on their behalf, to access, store, and share operational data, including diagnostic and telematics data. The Register's stated basis was that the prohibition adversely affects the ability of lawful owners and lessees ... to access, store, and share operational and telematics data, which are likely to be noninfringing ... and that the purported alternatives do not sufficiently mitigate any adverse effects.

The distinction that runs through the testimony is between the OBD2 port and telematics. The OBD2 port is the physical diagnostic connector under the dashboard that an independent shop can plug a scan tool into. Telematics data is generated by the vehicle's connected systems and transmitted off the car. Foshee told the hearing the 2023 agreement only includes telematics data that is not otherwise available via the OBD2 port in the car, which leaves the off-board telematics stream that dealers receive directly outside the shop's reach. The GAO documented the same gap from the manufacturer side.

What the Alliance for Automotive Innovation argued

Mark Humphrey, counsel for the Alliance for Automotive Innovation, at the April 18, 2024 Section 1201 Class 7 hearing.

Mark Humphrey appeared as counsel for the Alliance for Automotive Innovation. His core position was that the proposed Class 7 exemption was unnecessary because the data was already available. He told the panel the auto industry has taken great steps to make this kind of data available through the Memorandum of Understanding from 2014 and the Data-Sharing Commitment that was entered into just last year.

He argued that independent shops could already get the data through several routes, listing data-repository websites, aftermarket scan tools, and remote diagnostic support. He told the panel that independent repair facilities are able to obtain that data through multiple means.

Humphrey's claim at the April 18, 2024 hearing that the FTC and DOJ joint comment praised the auto industry's data-sharing record.

On the regulators, Humphrey said a joint filing by the FTC and the DOJ spoke glowingly of the auto industry as a standard to aspire to, because of the lengths that the industry has gone to provide this kind of data, and later that the DOJ/FTC report specifically says that the auto industry is probably leading the way in this.

On harm, Humphrey did not use the phrase often attributed to industry, no evidence of actual harm. His actual words put the petitioners to an evidentiary burden. He said I don't see anything from a specific person who has actually had these difficulties and that a lot of what I am hearing is hypothetical.

The refutations

The 2014 MOU excludes telematics

Lisa Foshee, senior vice president and general counsel of the Auto Care Association, answered Humphrey on the record. She testified that The 2014 MOU exempts telematics data. The ASA Pact or the Data-Sharing Agreement tries to window dress the inclusion of telematics, but it only includes telematics data that is not otherwise available via the OBD2 port in the car.

Auto Care Association senior vice president and general counsel Lisa Foshee testifying at the April 18, 2024 Section 1201 Class 7 hearing.

The 2023 commitment text confirms the carve-out. Disclosure of telematics data is gated behind three stacked conditions, all required before any duty arises. The commitment promises that data only To the extent that specific telematic diagnostic and repair data is needed to complete a repair, and also provided to an automaker's authorized dealers, the automaker shall make such information available to vehicle owners and independent repair facilities, if it is not otherwise available through a tool or third-party service information provider. By its terms the duty to share attaches only to telematics data the automaker also provides to its own authorized dealers.

The telematics carve-out language in the July 2023 National Automotive Repair Data Sharing Commitment.

The GAO recorded how many automakers route telematics data to their own dealers. Its March 2024 report states that Six automakers we interviewed told us they do not provide dealerships with any access to telematics data.

GAO-24-106633 (March 2024), the page recording automakers' dealer telematics access practices.

On enforceability, the GAO reported that Specifically, because those agreements are voluntary, stakeholders worried that automakers may stop providing access to the information, data, and tools needed for repair. To the extent that happens, independent repair shops may be limited in their ability to conduct some repairs.

GAO-24-106633, the passage recording independent repair stakeholders' enforceability concerns about the 2014 MOU and 2023 commitment.

The 2023 Data-Sharing Commitment is unenforceable and narrow

The commitment names exactly three signing parties: the Automotive Service Association, the Society of Collision Repair Specialists, and the Alliance for Automotive Innovation. The Auto Care Association, an original signatory to the 2014 MOU, refused to join. In a July 11, 2023 statement it said Auto Care Association, an original signatory to the 2014 Memorandum of Understanding, was not consulted about, was not a party to and does not support the agreement, and that ASA and SCRS, who did not sign or support the 2014 MOU, represent a small fraction of the independent repair market and do not speak for the automotive aftermarket.

The signing parties of the 2023 data-sharing commitment include two aftermarket groups, the Automotive Service Association and the Society of Collision Repair Specialists.

Foshee testified that the agreements are voluntary. They are non-binding. There's no enforcement mechanism. The GAO recorded the same concern, reporting that However, eight of the 14 independent repair stakeholders we interviewed expressed concerns about lack of enforceability in the 2014 Memorandum and 2023 commitment.

Foshee's testimony on the enforceability of the 2014 MOU and the 2023 commitment.

On how much of the market the signing groups represent, Foshee told the hearing that ASA represents less than two percent of the independent shops in the United States, and noted that ASA is in large part funded by the OEs ... most of the OEs are members of ASA. So it's really sort of an agreement with themselves. The Motor & Equipment Manufacturers Association makes a related point with a different denominator. MEMA states the agreements contain no enforcement mechanism, lack the necessary consumer choice protections, and in the case of the 2023 agreement, represent just one percent of aftermarket repair shops. The two figures are not the same measure: Foshee's less than two percent is ASA's share of independent shops on the federal-agency record, and MEMA's one percent is the signatories' share of aftermarket repair shops as an advocacy estimate.

Foshee's testimony on ASA's share of the independent repair market and its relationship with automakers.

Independent shops do not have equal data access

Humphrey told the hearing that independent repair facilities are able to obtain that data through multiple means, pointing to websites, aftermarket scan tools, and remote diagnostic support. The commitment text shows what that access depends on. Under the carve-out, the off-board telematics stream is promised only when the data is not otherwise available through a tool or third-party provider and only when the automaker treats it as needed, which leaves shops an indirect, conditional, multi-vendor path to data that dealers receive directly.

The GAO recorded the resulting disadvantage. It reported that In addition, a disparity in access to telematics data compared to dealerships could put independent repair shops at a competitive disadvantage. These potential effects could increase prices for consumers as well as affect consumers in other ways.

GAO-24-106633, the passage on competitive disadvantage for independent repair shops.

The GAO identified three specific disadvantage areas: remote diagnosis, marketing, and over-the-air updates.

The FTC and DOJ joint comment urged granting the exemption

Humphrey told the panel the FTC and DOJ joint comment spoke glowingly of the auto industry as a standard to aspire to and was probably leading the way. The joint comment asks the Copyright Office to grant the Class 7 exemption, and describes restricting telematics access as a competitively harmful bottleneck.

The DOJ Antitrust Division and the FTC wrote:

Restricting access to non-copyrightable telematics data risks establishing a competitively harmful bottleneck by depriving users of the ability to share this data with aftermarket parts manufacturers, third-party maintenance and repair services, and other adjacent markets that would put such information to valuable commercial use.

Their conclusion asked the Office to grant the exemption:

... we urge the Copyright Office to recommend that the Librarian renew the existing repair-related exemptions; expand the exemption for Class 5 ...; and grant the proposed exemption for Class 7 to allow circumvention by lawful vehicle owners and lessees, or those acting on their behalf, to access, store, and share vehicle operational data.

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  The joint comment of the DOJ Antitrust Division and the FTC warned that restricting access to non-copyrightable telematics data risks establishing a competitively harmful bottleneck for aftermarket repair.
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  The DOJ and FTC conclusion urging the Copyright Office to grant the Class 7 exemption.

The joint comment mentions the auto sector once, and only to rebut a safety argument, writing that manufacturers' safety arguments are difficult to square with the automotive sector, where owners and independent repair shops are routinely able to repair highly complex products that could cause great harm if improperly repaired. The words glowingly, standard to aspire to, and leading the way do not appear in the joint comment, and neither the 2014 MOU nor the 2023 commitment is mentioned in it.

The FTC's May 2021 report Nixing the Fix found that Based on a review of comments submitted and materials presented during the Workshop, there is scant evidence to support manufacturers' justifications for repair restrictions.

The FTC's May 2021 report Nixing the Fix, the passage on manufacturers' justifications for repair restrictions.

On the auto MOU specifically, the report recorded an outside view that it does not reach telematics, writing that For example, Aaron Lowe explained at the Workshop that the automobile MOU, while initially a sufficiently comprehensive agreement, does not necessarily extend in its current form to telematics. Where the report calls the MOU a model of self-regulation that could apply in the broader right to repair context, the framing is passive and attributed to outside commenters rather than stated as the FTC's own endorsement.

There is evidence of real harm

Lisa Foshee testified that the Auto Care Association recently released a survey ... that showed that nationwide 84 percent of independent shops consider access to this data in this sphere ... their number one issue, and that ... over half of the shops who responded to the survey send up to five vehicles per month to dealerships because of vehicle data restrictions, because they can't fix them.

Foshee's testimony at the April 18, 2024 hearing citing the Auto Care Association's April 2024 independent shop survey.

The underlying survey, released April 10, 2024, found that 84 percent of independent repair shops rank vehicle data access as their top business issue, 63 percent report difficulty accessing the data daily or weekly, and 51 percent send up to five vehicles a month to dealers because of data restrictions.

The Auto Care Association's April 2024 survey of independent repair shops on vehicle data access.

The GAO reported that the harm is not evenly distributed. According to five independent repair shops and independent repair associations the agency interviewed, The potential negative effects of reduced consumer choice may not be felt equally among all vehicle owners. For example, low-income or rural consumers could be harmed the most.

Voters have backed telematics right-to-repair laws by wide margins. Massachusetts approved the 2020 telematics ballot question, Question 1, by 2,599,182 yes votes to 867,674 no votes, about 75 percent of votes cast on the question. The same state had approved an earlier right-to-repair question in 2012, Question 1, by 2,353,603 to 392,562, about 86 percent. Maine approved its 2023 telematics question, Question 4, by 341,574 to 63,208, about 84 percent.

Official Massachusetts results for the 2020 right-to-repair telematics ballot question, Question 1.

After Massachusetts enforced its 2020 law, some automakers turned off connected features rather than provide equal access. NBC10 Boston reported in November 2023 that some of the automakers, in order to escape the requirements of the law, have turned off their internet connectivity features altogether, and that Massachusetts residents purchasing new Subarus no longer have the Starlink option.

NBC10 Boston's November 2023 report on automakers disabling connectivity under the Massachusetts right-to-repair law.

The Massachusetts Attorney General made the same point in litigation. In Alliance for Automotive Innovation v. Healey, No. 1:20-cv-12090-DPW (D. Mass.), the Attorney General argued that Subaru and Kia disabled telematics in model-year 2022 vehicles sold in Massachusetts rather than provide equal access, which the office presented as evidence that compliance with the state law was achievable. That argument is the Attorney General's litigation position.

See also

• DMCA Section 1201
• User:Louis/The History of Section 1201 of the DMCA
• Right to repair