New UK Bill - Orphaned Works...

[Ketsuekiame]

http://services.parliament.uk/bills/2012-13/enterpriseandregulatoryreform.html

Anyone seen this? Pretty much means that rights holders no longer have rights over their own work without registering them on a work-by-work basis. This allows companies to use, sell and sub-licence your works without asking you permission.

Might be wise to start taking all your pictures off the internet. Anything without metadata (or has had it stripped by Fa...an unscrupulous company) is fair game.

Note that this also extends to sound/music, designs(graphical, mechanical, system) and even software.

[Ancient Dragon]

That bill seems to have very broad provisions covering many different things. Can you post a link that discusses the topic which you are concerned?

[Ketsuekiame]

Unfortunately there is no "official" write up yet, that comes on Thursday. However, please see the Impact Analysis for the Orphan Works section (Filed un "Miscellaneous")

http://www.parliament.uk/documents/impact-assessments/IA12-025B.pdf

Getting hold of the relevant info including the ammendments is nigh on impossible :(
DO you reckon that this is intentional ?

Interesting, but I can't make head nor tail of it. What's the relevance of the UK Green bank to all this?

[Ketsuekiame]

Actually I think it's the other way around. The tagged copyright and orphan works sections on at a sneak attempt to get this pushed through parliament. One that has succeeded. The rest of the bill concentrates on the financial sector and legislating bonuses and banking.

If you read the IA, throughout the entire document the proposer speaks of the "market" and has little regard to the actual rights issues.

What makes this even worse, is that the MP behind this is a Liberal Democrat! I have never seen so much hypocrisy in one place as the current Lib Dem party.

EDIT: In fact, at one point in this document, the proposer fully admits that companies may strip metadata from digital works, rendering them an orphan work in doing so. The proposer comes up with a feeble non-sensical solution and doesn't explain anything. Even going so far as to openly admitting that it cannot and should not be regulated.

Getting hold of the relevant info including the ammendments is nigh on impossible :(
DO you reckon that this is intentional ?

As it's already received Royal Consent, it's already passed. Hiding it serves no purpose. However, I fully presume that they've rushed this through so quickly they haven't had time to write it.

[mike_2000_17]

At first glance, the whole "Option 0: Do nothing" versus "Option 1: Do what I propose" just reeks of false dichotomy. If I was a law-maker I would dismiss the proposal on that basis alone. There is no way that a serious person doing a serious proposal would have found that there are only two possible options, nothing and his own idea. Law-makers passing this show a great lack of basic critical thinking skills, they ought to be ashamed in requiring such a low standard for what a serious proposal is. Not to mention that the document itself looks like it was drafted by a high-school student.

That said, I don't disagree too much with the proposal / law, per se. It is clearly directed more towards the classic preconception of "orphan work" as kind of old footage, recordings or pictures, that people might want to use as part of a documentary or something. I think the provisions are OK for those purposes. But, obviously, the issue is complicated by the fact that in our insane IP-landscape, things like software are also under the same copyright classification as these works of arts, when, clearly, these are apples and oranges.

The problem with something like software development is that I can write some open-source code (say, under GPLv2 or GPLv3), and then a company can grab that code, strip away the license notices and meta-data in the files, and use it to create some closed-source application, and I will probably never know about it. I might even use the application and think "Oh, they seem to had done roughly what I did some years ago.", and still not have enough suspicion / evidence to actually attempt a legal pursuit to find out if they infringed my copyrights and get reparation. This law doesn't make that problem any better, nor any worse, as far as I can tell. However, there is the off-chance that the company is actually stupid enough to register the stolen work as orphan, in which case, it would be a lot easier for me to find out and prove that my work was stolen.

What I don't quite understand is the expiry period. What happens after? They say the reserved funds are going back to the Crown. But what if the rights-holder shows up after that period? Before this law, orphan work was essentially protected forever and could never be used. Now, it seems, the work can be used (which is the aim), but is only protected for a few years after it was registered as orphan. It seems to me like the rights-holder should be able to show up at any time (between now and forever) and stake his claim.

Another problem is also the fact that there seems to be no effective checks and balances when it comes to determining the fair price for licensing the works. The proposal had some very soft provisions for that, but they seem to have disappeared, since they don't appear in the law. I'm afraid companies will use this to dictate the "fair price" (i.e., a ridiculously low price) for the license, put that money in that fund they are supposed to keep, and then when the rights-holder shows up, they can give him that money and block him from any further legal claims for a real fair price. This would be a real good incentive to strip meta-data such that they can create liability-free and cheaply licensed "orphaned" works. But I would guess that if you can prove that the company orphaned the work, you have a legal claim on that basis.

But mostly, I think they should have made it applicable only to "works of art" type of orphan works. But then again, that's a larger problem, i.e., the insanity of applying "works of art" style IP laws to very commercializable things like engineering work or software development.

[jwenting]

They say the reserved funds are going back to the Crown. But what if the rights-holder shows up after that period?

that means that the intellectual property falls to the government once the original ownership expires. IOW there's no more expiring copyright, anything where the initial copyright period expires automatically is owned by the government now.

Before this law, orphan work was essentially protected forever and could never be used. Now, it seems, the work can be used (which is the aim), but is only protected for a few years after it was registered as orphan. It seems to me like the rights-holder should be able to show up at any time (between now and forever) and stake his claim.

if I read it right, the problem with the law is that anyone can himself orphan a work by removing prior ownership information, effectively legalising content piracy.
Find a movie, strip the copyright and trademark information, add your own, and it's now yours.
Probably unintentional, but you never know with politicians, especially those seeking ways to buy votes from the internet generation of kids who have no respect for anything or anyone and will pilfer and loot based on the general premise that everything they want is theirs by right.

[mike_2000_17]

if I read it right, the problem with the law is that anyone can himself orphan a work by removing prior ownership information, effectively legalising content piracy.

No, that's not what it means. The copyright notice / meta-data does not carry the copyrights, it is only relevant in finding the person who has it. Removing that information doesn't make it legal to own or use the material, it simply makes it look legal under the most superficial examination.

The copyrights are always carried by the content, to remove the copyright would mean to remove the content, thus defeating the whole purpose. For example, if I write a song, my copyrights are carried by the melody and the lyrics, anyone who reproduces or distributes a song with the same melody and lyrics without my consent is infringing my copyrights. The ownership information or meta-data are irrelevant. However, if I produce my song to iTunes with meta-data identifying me as the owner of the copyright, it certainly makes it easier for people to know who to contact to pay royalties if they want to use it.

Find a movie, strip the copyright and trademark information, add your own, and it's now yours.

No. It doesn't work that way at all, that would be quite ridiculous. If I download a movie illegally, strip away whatever copyright / trademark information in it, I still cannot claim that I made this movie entirely by myself. Just like I cannot claim to own the copyright on the "Billy Jeans" song just because I have an unsigned mp3 of it on my computer. The people who make the content never loose their copyrights on the content (unless they formally hand them over or renounce them).

The point here is about when the people who created the content are hard to track down or identify, i.e., the works is orphan.

When a rights-holder somehow is made aware that his orphaned content is being used or distributed by someone or some company, he can manifest himself, prove that the content is his original work (e.g., "I wrote that song, here is the original recording I took X years ago"), and then stake his claim for royalty back-pay or other form of reparation.

IOW there's no more expiring copyright, anything where the initial copyright period expires automatically is owned by the government now.

Copyrights never expire, not under this law, not under any other law that I know of. Copyrights even get inherited to the family members after death. What seems to expire under this law is the legal protection of the copyright that the government pre-emptively applies to orphan works. That's very different. In other words, if I find some works of unknown source that I want to use for some commercial project (e.g., as a clip within a movie I'm making), because the people who made that works could potentially manifest themselves (e.g., after seeing my movie), I should put some money aside equivalent to what I would normally pay as royalty if I could contact the authors, just in case. This law says the government should mandate that this money be put aside and safe-keep the fund itself, but only for a limited period (5 years), after which whatever money is in that fund goes back to the Crown. What is unclear is what happens next if the author manifests himself. He still has the copyrights, there's no question about that, but the question is whether he can still get some money for that particular project in which his work was used.

This is a per-project thing, it is not an expiry date on the copyright, there is no such thing, and certainly, the government does not ever get the ownership of any copyrights. The role of the government, as mandated by this law and the EU's laws, is to act as a protector of the rights of the copyright owner in his stead. In other words, the copyright is put under the government's care, since there is no one else to care for it, for as long as the copyright holder cannot be identified, but there is no dispute about who owns the copyright, just about whether you can identify that person or not. This is a very important distinction.

Before this law, and in most countries, the government protects the copyright by not allowing anyone to use the material. With this law, the government protects the copyright while allowing the use of the material, under certain conditions, reasonable or not, strict enough or not, that's the point of this discussion thread. But don't blow things out of proportion.

Probably unintentional, but you never know with politicians, especially those seeking ways to buy votes from the internet generation of kids who have no respect for anything or anyone and will pilfer and loot based on the general premise that everything they want is theirs by right.

bla bla bla ... white noise.

[Agilemind]

Since the works have to be registered as orphan I doubt individuals will be making much use of the system but this very much depends on how strict the requirements are for a diligent search. It looks to be mostly targetted at museums/archives. I agree it is not clear how the royalty fees will be determined which could be an issue for returning copyright holders.

Probably unintentional, but you never know with politicians, especially those seeking ways to buy votes from the internet generation of kids who have no respect for anything or anyone and will pilfer and loot based on the general premise that everything they want is theirs by right.

I wish. Everyone knows only a minority of the internet generation votes so hardly any politicians will even hand out platitudes to them (on the contrary there seem to be many more happy to portray the youth as violent, pirating, lazy, idiots).

[Ketsuekiame]

When a rights-holder somehow is made aware that his orphaned content is being used or distributed by someone or some company, he can manifest himself, prove that the content is his original work (e.g., "I wrote that song, here is the original recording I took X years ago"), and then stake his claim for royalty back-pay or other form of reparation.

I think this is where the problem will lay for most of us.

Like you said in your example, if you have work, even unpublished work, it can be classified as an orphan if it has no meta-data to identify the owner, or if the owner cannot be verified after a "diligent" search.

So if someone gets ahold of some of your code and uses it themselves, stripping any header/licence content in the process, how do you prove it's yours?
Now think if this gets used in a big company, their lawyers will eat you alive and quite possibly counter-sue for deformation or some other dubious claim.

You effectively lost your rights to the content you wrote and this worries me. The government has legislated to give more protection to companies that use content illegally, to the point of giving them power to claim content they didn't write as their own.

He still has the copyrights, there's no question about that, but the question is whether he can still get some money for that particular project in which his work was used.

Actually I'm not sure the author would retain copyright indefinitely. The UK has a history of flying in the face of sensibility regarding copyright law. For example; you can only hold copyright of a design for 25 years . Where-as I believe the Berne Convention states that this applies for the life-time of the author +50 years (+75 years in the EU laws. The photography copyright is 25 years iirc but a design is not photography nor cinematic)
I think the answer to this question will be buried in the Copyright Act, or, will be verified by the official document wording on Thursday.

Honestly, I think for we "little fish" this is a major kick in the teeth and a big pat on the back to the corporations.
I'm simply shocked this came from the Liberal Democrats. I could understand if it was from the Conservatives (not that I support either party, but the Lib Dems supposedly being liberal and everything...)

[mike_2000_17]

So if someone gets ahold of some of your code and uses it themselves, stripping any header/licence content in the process, how do you prove it's yours?

Simple, use this command:

$ sim_text their_code/src/* / my_code/src/*

or any other code-duplication detection tool. But the problem is, of course, to be able to force the company to allow this kind of scrutiny to be applied to their source code, this is a problem of "probable cause", meaning you must have strong suspicions and be able to show that it is reasonable for you to have strong suspicions, and thus, be allowed to perform such a verification to see if some of their source code is actually yours.

This is the big problem with "hidden" works like that. I think that at the very least, for engineering or software, if a company actually wants to make use of orphan work, they should also be required to make that public and make the work publicly available. But again, with such laws, there would be no reason for any company, unless mentally challenged, to actually do this.

Like you said in your example, if you have work, even unpublished work, it can be classified as an orphan if it has no meta-data to identify the owner, or if the owner cannot be verified after a "diligent" search.

I don't really think that companies would have much reason to register their stolen works as orphan, especially in the case of engineering works or software development. I think they would normally just not tell anyone about it, it's not like there is anyone who is actually verifying that companies use only their original works and properly licensed works of others. The law really only gives a way for honest companies to use orphan work in an honest and legal fashion, but it provides no means whatsoever to keep dishonest companies from making dishonest uses of orphan or stolen works.

As far as I'm concerned, this law is a complete "status quo" when it comes to preventing the illegal use of material.

You effectively lost your rights to the content you wrote and this worries me.

I don't know what you mean by "rights to the content" here.

If you mean the "ability to prevent people from using it without your permission", then the law is essentially neutral on this point (which is a matter of "enforcement", not of rights), you never had the ability to do that in the past, nor do you have it today.

If you mean the "ability to claim copyright ownership of the works", then this law doesn't change anything either, this is merely a technical matter of whether or not you have kept enough proof to show that it is your original work, and that you can show enough correlation with the content used by the company.

If you mean the "ability to make people liable for using your works", then that's where this law changes the ball-game because the liability of the company is administered by the government for a limited period, and if you stake your claim during that period there is a chance that you get the short end of the stick (i.e., the "fair price" wasn't fair at all), and if you come in afterwards, you might not get anything at all (but that is not clear from the law).

If you mean that a "small fish" individual cannot effectively make his rights respected in the face of large companies with armies of lawyers, well, has it ever been otherwise? I mean, big fish eat small fish. Until all fishes are roughly the same size, this is never gonna change. Good legislation and fair justice systems can help to level the playing field a little bit, but they can't solve that problem.

The government has legislated to give more protection to companies that use content illegally

I think that's a misinterpretation of the law, as I explained above. As far as I can see, this law represents status quo when it comes to illegal uses of content, except, as I said, for the odd-ball stupid company who would actually register stolen work as orphan (at least, certainly for engineering works or software development).

It really all boils down to how the "fair price" is determined. If it is significantly lower than what you would normally negociate with the rights-holder, then there could be an incentive to "orphanate" the works. Otherwise, I see no point for a company to do that, unless they are really stupid. When it comes to things that are generally "hidden" under the hood, like engineering work or software, why on Earth would a company openly register the works that they have stolen, instead of just using it without telling anyone. This would be in the realm of "stupid" just like telling your insurance company that you're suicidal just before negotiating a life-insurance contract with them.

to the point of giving them power to claim content they didn't write as their own.

That's not true at all, as I explained in my earlier post in reply to jwenting.

The law can be summed up in one sentence as: "Giving the power to legally use content of unknown origin".

Claiming content as your own was illegal then, and is illegal now, nothing changed with this law.
Avoiding payment of royalties by just using the content and hoping the rights-holder doesn't show up was illegal then, is illegal now, nothing changed.
Reducing the amount of royalties paid by negociating it as orphan works with the state as opposed to negociating with the original author is made possible now (and maybe advantageous, depending on the "fair price"), but still illegal / fraudulent, of course.

I know that copyright laws are hard to grasp, but there are important distinctions to make, and without them, you can draw very different conclusions from the same piece of legislation.

[Reverend Jim]

Everyone knows

I make it a rule to not trust any statement beginning with "Everyone knows..."

[mike_2000_17]

Everyone knows only a minority of the internet generation votes so hardly any politicians will even hand out platitudes to them.

I would say there is much more evidence that most politicians are completely oblivious to the concerns of the "internet generation", whether it would be in there interest (attracting votes) or not. They simply do not understand this "new" world, and so, at best, they do what they are told, most often by large companies who do understand this "new" world and want to take advantage of it by bending the rules in their favor. And if the "internet generation" doesn't vote as much (which I'm not convinced of, btw), it is largely because of that, i.e., they don't see politicians as representing them at all. As far as I'm concerned, politicians are neanderthals in the age of technology.

For example, in Canada, our minister of science and technology, which I have met recently, is a chiropractor. In other words, the best we can do in terms of having someone who understands science and technology is a person who clings to a pseudo-scientific practice from the 19th century. I think that's a perfect symbol for this whole problem.

[Agilemind]

I make it a rule to not trust any statement beginning with "Everyone knows..."

Clearly I should apologize for assuming that a well documented fact over the past couple of decades in every western country I have looked at was common knowledge to the politically active residents/citizens of said countries. But then again so many people doubt or actively disbelieve other well documented facts I guess I shouldn't be surprised anymore.

Canada: ~40% 18-24 year olds voted in the last three general election vs ~70% of people over 55 http://www.parl.gc.ca/Content/LOP/ResearchPublications/2010-19-e.htm
USA: ~47% of young people vote vs ~67% of older people vote over past several years http://www.civicyouth.org/quick-facts/youth-voting/
UK: ~40% 18-24 yearolds vote vs ~60% of total population since 2001 http://www.bbc.co.uk/newsbeat/18727320
Australia: voting in compuslory so difficult to compare but using enrollment as a proxy 81% of eligible 18-24 yearolds enrolled to vote vs 92% for the country. http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1370.0~2010~Chapter~Voter%20turnout%20%284.6.7.1%29
New Zealand: lower enrollment and lower voting rate for 18-24 yearolds http://www.mm-research.com/Young+People%27s+Participation+in+the+Voting+Process

Sure there are tons of factors at play including the politicians 'not getting' in the internet generation, but you'll also find most of them don't bother trying. When was the last time you heard student debt or tuition or investment in higher education mentioned in a national election debate? contrast that with how often you hear politicians talk about pensions.

[jwenting]

a-data does not carry the copyrights, it is only relevant in finding the person who has it. Removing that information doesn't make it legal to own or use the materi

meta-data does not carry the copyrights, it is only relevant in finding the person who has it. Removing that information doesn't make it legal to own or use the material,

That's not true at all, as I explained in my earlier post in reply to jwenting.

The law can be summed up in one sentence as: "Giving the power to legally use content of unknown origin".

indeed data does not carry copyright RIGHT NOW, but as I explained this law changes that, REQUIRING copyright information in data and, when this is not present, the data is automatically orphaned.
Any unscrupulous person or company can use this at their leasure, taking data, stripping copyright information (if present, data predating this law not carrying such information is fair game, as is any data published elsewhere where such requirements do not exist), adding their own copyright notices in its stead, and calling it their own.

THAT's the problem with this legislation, it twists what constitutes a copyrighted work into making it impossible to protect yourself against content theft.
It's dead easy to write a crawler that travels the net, downloads stuff it finds, "cleans" it of any copyright notices (in most file formats those are well defined fields), and send it to your servers where you can then file it all as "orphaned" (look what we found, all these orphaned images and documents, we're now claiming them as our own), and they'll get a number of years of ownership under the law before it reverts to the British crown/state, international law and treaties be damned.
It's even worse than the Dutch government's decision to legalise intellectual property theft by deciding that anything you download is automatically legally yours to use, but to upload something you need permission from the copyright holder. This law will remove that last clause, making it so that anything you manage to remove the copyright notices from is automatically yours to do with as you desire.

[Agilemind]

It's dead easy to write a crawler that travels the net, downloads stuff it finds, "cleans" it of any copyright notices (in most file formats those are well defined fields), and send it to your servers where you can then file it all as "orphaned" (look what we found, all these orphaned images and documents, we're now claiming them as our own), and they'll get a number of years of ownership under the law before it reverts to the British crown/state, international law and treaties be damned.

If just cleaning the copyright notices was enough to make it orphaned (which I highly doubt). You still wouldn't be able to claim ownership of the work. Instead the Crown will operate effectively as a representative of the true owner and charge licensing fees for the use of the work which will be stored for 5years so that if the true owner re-claims the work as theirs within that time they will recieve all the licensing fees from the government and will continue to own their work. If after five years the true owner hasn't reclaimed the work the government will beable to use the collected fees as normal gov't revenue but still doesn't 'own' the work, it is unclear what would happen if the true-owner reclaimed the work after five years - they would still own the work but it is not clear how much of the licensing fees they will recieve.

It's even worse than the Dutch government's decision to legalise intellectual property theft by deciding that anything you download is automatically legally yours to use, but to upload something you need permission from the copyright holder. This law will remove that last clause, making it so that anything you manage to remove the copyright notices from is automatically yours to do with as you desire

1) this law is only applicable to the UK so it will have no bearing on Dutch legislation nor does Dutch legislation have any bearing on it.
2) I don't know what the Dutch legislation is your referring to but it sounds like it has nothing to do with stripping copyright notices so again I don't see the relevance to this discussion.
3) stripping copyright notices is not sufficient to make the work 'orphaned', just consider any popular song/movie even without copyright notices it is well known who the work belongs to so it would not be considered 'orphaned'
4) registering something as orphaned does not make it yours.

[Ketsuekiame]

I think what jwenting is trying to say is...Let's consider this example:

You're an amateur/semi-professional photographer. You just took a range of photographs, tagged it with your metadata and uploaded it to Duckfacebook as an example of your work.
Duckfacebook strips the metadata from your work, whilst maintaining the public accessibility of your work (that you asked for).

AcmePicturesInc. likes your photographs and wants to use them in their marketting material, but don't want to pay you any royalties. API downloads your pictures and distributes them via its own gallery and sister website galleries.
API hires an SEO expert to make sure all their sites appear in the top rankings where they can.

API performs a "dilligent" search, primarily using Poogle to search on the internet and the available databases from picture galleries.

As the SEO results return their own website as the picture source, the Registry allows them to be an orphaned work and they become licenced to API. API then starts using and selling your images.

The nastier case
So what if API decided to get really nasty with their big team of lawyers. You present a risk to their company, one they can sweep out of the way effectively, so why not.
One day you go to Duckfacebook and find all your pictures have been deleted due to copyright infringement. You file a complaint but find that as these are orphaned works and have been registered to API, you now have a lengthy court battle to prove the images are originally yours. You have a backup, you have them on memory card, but they're all digital. It would be fairly easy for their lawyers to persuade a judge that you downloaded the pictures illegally and altered the metadata to look like your own. At this point, you may now be open to a counter-claim.

Although you can consider all this a fringe case, it has the possibility of ocurring and this is what is worrying a couple of the photographers I knew at University. We/You may call it far-fetched, but they're truly concerned by it.

[jwenting]

correct, and if API are really nasty, they not just strip your metadata but insert their own, then register it as their copyrighted work and sue you for infringing their copyright.

I've dealt with some theft of my work in the past, and even just going after infringers is hard and expensive. Add this dimension of the infringer being able to claim ownership of your work simply by stripping it of your metadata and then claiming it to be orphaned, and it becomes impossible unless you have very deep pockets and systems to register every single image, document, and indeed anything else that you upload anywhere with IP agencies in the UK (and no doubt soonish every other country, such laws tend to spread like wildfire), each of which registrations carries its fees (even if maybe only the cost of posting copies of the work to the agency in print or digital form).

[Agilemind]

correct, and if API are really nasty, they not just strip your metadata but insert their own, then register it as their copyrighted work and sue you for infringing their copyright.

This is already against the law and this new law will not change that. This is an issue of increasing enforcement which I whole heartly agree with.

One day you go to Duckfacebook and find all your pictures have been deleted due to copyright infringement. You file a complaint but find that as these are orphaned works and have been registered to API. You now have a lengthy court battle to prove the images are originally yours.

Registering them as orphaned does not give API the ownership of the work. So there should be minimal if any court battle since API has no claim the images are theirs, in fact by registering them as orphaned they are admitting the images are not theirs but they do not know who the owner is.

[jwenting]

Registering them as orphaned does not give API the ownership of the work.

effectively it does, as it gives them sole unlimited usage rights to the work, and strips its former owners of any such rights.
It thus is no longer an orphaned work, iow a work without an owner, but the person registering it becomes the owner, albeit for a more limited time than the original copyright would have granted the creator.

[mike_2000_17]

The nastier case

Actually, the new law makes things better in this particular example. Before the law, the company had the following options:

1) Not use your works, i.e., find something else to put in their marketing material.
2) Pay royalties to you for using your works.
3) (illegal) Strip the meta-data from the works and use it without telling anyone.
4) (illegal) Strip the meta-data from the works, forge their own meta-data onto it, and use it while claiming it's their original works.

This law adds a fifth option:

5) (illegal) Strip the meta-data from the works, register it as orphan, and use it while paying a nominal royalty into a reserved fund.

When it comes to option 1 to 4, the new law does not have any effect at all. And in the options 3 and 4, you are likely going to have a hard time in court trying to prove that the works are your own, and I agree that this is a problem, however, it is a problem that is completely unrelated to and unaffected by the new law. However, in the off-chance that a (very stupid) company actually chooses option 5, it will actually be easier to "prove" that the works are your own, because there is no-one else claiming ownership of the work. The company registered it as "not their works" and the royalty money has already been set aside by the time you show up with a claim, meaning that the company really doesn't have any reason (possible gain) or legitimacy in fighting you in court. So, you're actually lucky if the company registers your works as orphan, as opposed to simply choosing options 3 or 4.

The only reason I can see why a company would choose option 5 over the other two illegal options, is the fact that option 5 gives them plausible deniability. They can always say that they honestly thought it was orphan and that they did not strip the meta-data themselves. In options 3 or 4, they cannot deny their culpability if discovered and proven that the works is yours. In option 3, it means they used works from an unknown (or stripped) origin without registering it as orphan, which is illegal. In option 4, it means they falsely claimed works of an unknown (or stripped) origin as their own, which is also illegal. But in option 5, even if the company stripped the meta-data, nobody can prove that they did. But then again, why would a company go through the trouble of using option 5, instead of simply using option 2 and paying the royalties directly to the author instead of into a fund (which again, brings it back to the issue of "fair price").

effectively it does, as it gives them sole unlimited usage rights to the work, and strips its former owners of any such rights.

I think you are very confused or reading a lot more into the law than what's printed. I don't know how you could possibly draw that conclusion from the text of the law. First, registering the works as orphan does not give the company "sole" usage rights, any other company or individual can also use that works by going to the registry bureau and start paying royalties. Second, the company does not get "unlimited" usage rights, the company gets a license to use the works in a limited fashion, just like any other license agreement you could strike with the original author. And finally, the law does not "strip its former owners of any such rights", in fact, it does the opposite, it protects the original owners' rights in his stead for as long as he has not manifested himself. I think you must have read a different text for the law, because the one Ketsuekiame linked to does not permit the interpretation that you give it, not with a clear mind at least.