It’s tempting to make bad jokes about Hatching
plots to ban P2P by any means necessary, no matter the collateral damage to
existing and new technological development. While Orrin Hatch continues his
quest to further unbalance copyright law, it’s not that simple. This
installment continues the INDUCE/IICA saga and notes a House bill with
interesting and in some cases similar provisions. Because of space, time, and
energy, a bunch of copyright stuff will be discussed later (or abandoned
One quick note in a rare three-issue sequence. In Cites & Insights , I discussed the Sima GoDVD! box, which “enhances” video in the analog domain so that you can convert it to digital form to burn to DVD, and in the process appears to undo Macrovision copy protection (which works by degrading analog video in a specific manner). In the following issue, I noted a clarification from Seth Finkelstein to my presumption that GoDVD! couldn’t be prosecuted under DMCA because it operates entirely in the analog domain: DMCA had a special provision to protect Macrovision even in analog cases. I commented that GoDVD! was still probably in the clear, because the DMCA clause discusses recording devices, and GoDVD! isn’t a recording device. An October 13 post at Finkelstein’s Infothought blog (sethf.com/infothought/blog/, highly recommended) quotes my full discussion, highlights the last sentence (“…it’s just a video enhancement box”), and suggests that GoDVD! probably doesn’t violate the letter of the law. “On the other hand, this looks very much like what a hostile judge would view as a loophole. Or at least fodder for a quick amendment.” His conclusion: “Even if it’s true now that the GoDVD! box does not violate the Macrovision section of the DMCA, I’m not optimistic as to how long it will remain true.”
When last we saw this rapidly mutating creature (C&I , Copyright Perspective: IICA: Inducing to Infringe), it began as a badly written proposal that Orrin Hatch wanted to fast-track through to law without even holding hearings. Then the name changed (from INDUCE to IICA—but most people still call it INDUCE), Hatch issued an extreme statement followed by loads of analysis from various soruces, the Senate held a hearing during which almost nobody favored IICA as written, and a variety of new versions emerged. (Before anyone accuses me of partisanship, I should note that Patrick Leahy, a Democrat, introduced the bill along with Republican Hatch. Extreme copyright is not a party-line matter, more’s the pity.)
A September 10 item from Fred von Lohmann of the Electronic Frontier Foundation (EFF) picks up where we left off: “Betamax under siege again.” The article considers the Copyright Office’s version of IICA (mentioned last time around), notes that the tried-and-true Betamax defense would be replaced with a new three-part test, and asserts that “the Copyright Office is proposing that copyright owners get a new exclusive right over a certain subset of machines that are capable of ‘disseminating’ copyrighted works.” “If this isn’t about using copyright law to squash disruptive technological innovation, I don’t know what is.” He believes that, had this act existed in 1976, the VCR and cassette recorder would both be banned.
A September 14 Wired News story by Katie Dean notes a growing “anti-INDUCE” campaign with a website, Save Betamax. The campaign urges people to call their legislators, and specifically a key group of legislators, urging them to oppose INDUCE. The co-founder of Red Hat and founder of Lulu noted, “The Induce Act will make it more difficult for the next generation of entrepreneurs to be successful.”
Yet another version of S.2560 (IICA) appeared by September 24. This version still makes copyright infringers of anyone who “intentionally induces [copyright infringement] by manufacturing, offering to the public, providing, or otherwise trafficking in any product or service.” It defines “intentional” as requiring “conscious and deliberate affirmative acts which a reasonable person would expect to result in widespread violations…taking into consideration a totality of the circumstances” and adds three clarifying clauses:
Ø Knowing that someone uses your equipment to infringe doesn’t in itself demonstrate intent.
Ø Evidence of private noncommercial use can’t be the basis for IICA action.
Ø Financing, marketing, reviewing, or producing instructions that don’t encourage infringement can’t be considered violations.
Injunctions are supposed to be limited so as not to restrain noninfringing uses; actual damages (as opposed to statutory damages) can’t be awarded without repeated deliberate violations; and there’s an explicit statement upholding the Betamax doctrine.
Is this version a reasonable balance? Not if you believe
Susan Crawford, the American Conservative
Another Katie Dean story, dated September 27, notes that critics aren’t wild about the newer version. As noted by Andrew Greenberg of IEEE-USA, “If I release and distribute a product that can be used to infringe, I’m at least going to face a jury trial,” by itself a substantial bar against innovation. [Emphasis added.] Noting the 40+ organizations that have called for more hearings, EFF’s Jason Schultz said, “Hatch’s staff still has not heard what the technology companies have been shouting as loud as they can. He just rejected them all and went back to his own version. It makes you wonder how much he was actually listening to what people were saying.”
A September 28 alert from ALA’s Washington office notes that
there have been no hearings on the current (fourth) version of the act, call it
“the greatest threat to date to the innovation processes that the copyright and
patent laws were intended to promote,” and considers the exceptions to its
broad definition of inducement “full of loopholes.” Another von Lohmann posting
that day said staffers were now working on a fifth version of the bill
(by his count) after facing “a withering hail of opposition from everyone other
than the RIAA.” He labels the bill “a tax on innovation” and “a damper on
earnings, a drag on competitiveness.” And, of course, unless all Internet lines
are cut at national borders, the bill wouldn’t stop P2P at all—it would just
move the vendors overseas. (He notes that yet another conservative group, the
An open letter from heads of the Business Software Alliance, Computer Systems Policy Project, and Information Technology Industry Council to Hatch and Leahy discusses these groups’ eagerness to work with the Senate to “address the problems that illicit file sharing services pose to consumers and to copyright owners”—and says that the most recent IICA draft continues to endanger the Betamax doctrine and “encourage litigation and ultimately require responsible companies to spend resources defending themselves, even when no illicit aims are present.” The letter urges a more narrowly tailored approach.
Come September 30, Hatch recognized that there was too much opposition to move IICA forward, but he was unwilling to concede that it was a stupid idea: “If I have to, I will lock all of the key parties in a room until they come out with an acceptable bill that stops the bad actors and preserves technological innovation.” That “locked room” apparently began on October 1, with a select group meeting behind closed doors to try to create an appropriate draft within 6.5 hours. Edward Felten noted that in a post in which he also says that, as he reads it, the current draft (as of then) “would appear to ban the manufacture and sale of photocopy machines by companies like Xerox.”
So what did that closed meeting—and possibly more work by staffers through October 4—result in? A draft that specifically cites peer-to-peer products and services, requires that “the majority of revenues…result from covered infringement” and the accused is aware that “the copies or phonorecords that are made available by covered infringement are the principal reason [the majority of] users use the product or service.” Unfortunately, following sections undo the “peer-to-peer” limit. Here are the key paragraphs, verbatim:
(B) the term "peer-to-peer" shall mean any generally available product or service that enables individual consumers' devices or computers, over a publicly available network, to make a copy or phonorecord available to, and locate and obtain a copy or phonorecord from, the computers or devices of other consumers who make such content publicly available by means of the same or an interoperable product or service, where
(1) such content is made publicly available among individuals whose actual identities [and electronic mail address] are unknown to one another; and
(2) such program is used in a manner in which there is no central operator of a central repository, index or directly who can remove or disable access to allegedly infringing content.
Edward Felten understands this stuff a lot better than I do.
His first reaction (
According to AP and Katie Dean stories on
The Cato Institute had a panel discussion on October 20, “balanced” by having speakers from MPAA, RIAA, NetCoalition and Public Knowledge. According to notes at Copyfight, the MPAA’s David Green never mentioned Betamax, claimed IICA was not a new and radical change, and asserted that anyone can get current Hollywood products “in mere seconds” using P2P. Mitch Glazier from RIAA pulled the standard trick: P2P is a conduit to porn and we must think of the children.
Gigi Sohn from Public Knowledge started with Betamax, noted that this was about a lot more than P2P, called Glazier’s porn gambit “cynical and unfortunate,” and pointed out just how much innovation would be halted by IICA. Some time back, EFF drew up a mock (but entirely plausible) complaint against Apple’s iPod on IICA grounds; as Sohn notes, the entertainment people say “we won’t go after things like the iPod”—but the history of DMCA and other laws demonstrates otherwise. Markham Ericson from NetCoalition started out saying “the entire Internet is a giant copying machine”—that everything is a P2P platform in some way. He denies that there are tech companies supporting IICA.
A Wired News story on the same Cato discussion included predictions from Glazier that record companies would sanction “three or four” legal P2P services. More than one party felt that Hatch was simply pushing for a compromise on too tight a schedule (and Hatch promises to reintroduce IICA next year). Adam Thierer of Cato Institute feared that the situation would lead to compulsory licenses for internet-distributed content, which to libertarians may be the worst of all possible outcomes.
So IICA is dead, at least until 2005. Or is it? Read on, and note the various provisions of HR4077, the Piracy Deterrence and Education Act, which actually passed the House of Representatives.
This bill, HR4077, originated near the end of March. I won’t assume that the acronym, PDEA, is deliberately identical to the Public Domain Enhancement Act; accidents do happen. It is based on findings that assert that the Internet has changed the nature of many crimes; that “trafficking in infringing copyrighted works through increasingly sophisticated electronic means, including peer-to-peer file trading networks, Internet chat rooms, and news groups,” threatens jobs, income, tax revenue, and means higher prices; that P2P programs have been downloaded more than 200 million times; that “at any one time there are over 3,000,000 users simultaneously using just one of these services; that an average of 2.3 billion files are transferred among users of these systems each month; that many computer users believe they won’t be caught; that P2P networks pose huge privacy and security threats; and that, because of all this, there needs to be a big enforcement and awareness program. It’s interesting that the finding as to P2P usage say nothing about legal usage, leaving the implication that all 2.3 billion files represent copyright infringements. (Are “3 million simultaneous users” and “2.3 billion files” testable numbers?)
Actions in the original bill include a new information-sharing program under the FBI and Register of Copyrights to “deter members of the public from committing acts of copyright infringement through the Internet” and facilitate information on such infringement among law enforcement agencies, ISPs, and copyright owners. Other sections provide for specialized training in investigating intellectual property crimes, establishing an “Internet Use Education Program,” and outlawing use of camcorders in motion picture theaters. The education program is interesting, as its stated purposes are to educate the public “concerning the value of copyrighted works” and “concerning the privacy, security, and other risks of using the Internet to obtain illegal copies of copyrighted works.”
Then it gets interesting. There’s a long section on the “sense of the Congress” regarding illegal activity on P2P services, rife with references to pornography and child pornography. Then there’s the true killer clause: Reducing the threshold for criminal infringement to one or more copies of one or more copyrighted works with more than $1,000 total retail value, or a single copy of any pre-release work regardless of value, or causing the distribution of 1,000 or more copies of any work, regardless of value. The clause also increases the penalty, making such infringement a Federal felony (prison terms of up to three years for first offense, fines of up to $250,000)—and for civil remedies, any prerelease work is conclusively presumed to be worth damages of at least $10,000 per infringement. Notably, prosecutors don’t even have to show that $1,000 worth of copyrighted materials was downloaded; they need only show that the files were accessible in a shared folder.
I’d guess that many balanced-copyright advocates would have no problem with the “no camcorders in movie theaters” provision; I certainly don’t. I don’t have much trouble with the training and information-sharing clauses, and only wonder about the one-sidedness of the education program. The new penalty thresholds and damage amounts may be another question.
On September 24, the bill was modified by striking all of the substantive text and substituting a new version. The new version substitutes for the information-sharing program a voluntary program in which the Department of Justice (DoJ) would send notices regarding apparent infringement via internet to ISPs, which “may forward the notices to such persons”—with an 18 month and 10,000 notice limit and with a rule that the ISP may not disclose information about the recipient of a DoJ notice back to the DoJ unless there’s a court order or other legal process. Further, DoJ would reimburse the ISPs for their costs in forwarding notices. Other than the issue of getting the DoJ involved in pursuing casual infringement, this clause seems harmless enough.
The P2P discussion now states that more than 600 million copies of P2P programs have been downloaded worldwide (without noting that non-U.S. copies are out of Congress’s control). Finally, the new version adds the “Family Movie Act of 2004,” specifically exempting ClearPlay and similar services (see elsewhere in this issue) from copyright and trademark infringement—with a hefty fine if the service fails to provide a clear “this motion picture has been altered” notice when the DVD is played. The new version also diverts $15 million in Federal funds to prosecute copyright infringement.
So, basically, the revised version added protection for DVD
Bowdlerizing and changed one other clause. Then it passed—on September 28, on a
voice vote, sans hearings on the totally-rewritten
Public Knowledge’s commentary notes several other problems (and points I’d missed):
Ø The bill makes “offering for distribution” and “making available” the bases for criminal and civil violations respectively, not requiring demonstration of actual infringement
Ø It’s always been the case that you need to register copyrighted works with the Copyright Office in order to enforce criminal copyright infringement. This act appears to remove that requirement (and eliminate one of the few reasons for registering a work, which lets others know who to contact to license it).
Ø The $15 million appropriation has the Federal government paying to enforce private claims, which it doesn’t normally do.
Ø There are theoretically cases in which recording portions of a film in a theater is fair use—i.e., for criticism or study. That’s true, but it’s one case where—as a pragmatist—I’m inclined to balance possible fair use against known true piracy (that is, mass-produced DVDs and CD-Vs, sold mostly overseas for commercial gain, clearly made from camcorder recordings in theaters). The balance might be that circumventing DVD copy protection for fair use purposes should not be a DMCA violation, as it now is.
Apparently the final version of the bill designates the Oak as the national tree. What that has to do with piracy deterrence or education is beyond me.
More than one commentator, including Larry Lessig, noted that the assortment of provisions in HR4077 had originally appeared as single-page copyright acts—and that “these thousand tiny cuts have now been united in a single bill, HR4077, which is racing through Congress—while all our attention was focused on INDUCE.” Lessig goes on: “Nice play by those lobbyists. I guess that’s why they get paid so much.”
Just how clever was the push to get HR4077 and a related HR2391 passed under the radar? Their passage was proposed to the Senate as a unanimous consent measure: No hearings, no discussion, just pass ‘em along to the Prez. That happened on October 11.
Fortunately for any sense of reasoned argument or balanced copyright, John McCain objected. His objection is based on the “don’t skip ads” gotcha, but that’s enough. “Americans have been recording TV shows and fast-forwarding through commercials for more than thirty years. Do we really expect to throw people in jail in 2004 for behavior they’ve been engaged in for more than a quarter century?” (McCain favors the primary goal of that section, making it legal to provide automated ways to skip offensive material on your own copy of a DVD. No disagreement here.) My understanding is that Senator Hatch said mean things to McCain for slowing up the process. Public Knowledge and Consumers Union representatives sent McCain a nice letter for his efforts to “ensure that there is proper consideration of H.R. 2391 and H.R. 4077.” Notably, the letter asserts that ClearPlay and its ilk shouldn’t require new legislation—“this is a right that most believe manufacturers of technology and consumers already have.” The letter goes on to mention some of the other problems with the package.
That’s where it stands, as far as I know. Will this can of worms re-emerge in various forms in 2005? You can count on it.
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