DoJ Can Do More to Protect Copyrights, Task Force Says

“The enforcement of our intellectual property laws is among the highest priorities of the Justice Department,” Attorney Gen. John Ashcroft said in a statement. Ashcroft created the task force in March and named DoJ Deputy Chief of Staff David Israelite its chairman. The report (http://www.cybercrime.gov/IPTaskForceReport.pdf) and a DoJ statement supporting it cited the importance of IP. It said the industry accounts for 6% of U.S. gross domestic product, employs 5 million people and contributes $626 billion to the U.S. economy. The report was praised by content industry associations but greeted with caution by a P2P industry group.

Among the task force recommendations: (1) Create more Computer Hacking and Intellectual Property (CHIP) units and expand existing ones. CHIP units coordinate law enforcement with local content producers. The 5 new CHIP locations would be D.C., Sacramento, Pittsburgh, Nashville and Orlando. (2) Consider increasing resources for DoJ’s Computer Crime and Intellectual Property Section. (3) Increase the number of FBI agents assigned to IP investigations. (4) Enhance training for law enforcement on IP issues. (5) “Emphasize the importance of charging intellectual property offenses in every type of investigation where such charges are applicable, including organized crime, fraud and illegal international smuggling.”

The report repeatedly emphasized this last point. While noting recent arrests and prosecutions in IP cases, the task force said “the laws protecting intellectual property rights must be enforced.” The report said DoJ needed to be more aggressive in IP enforcement, particularly when it came to large, national criminal enterprises, but it also said the content industry had a “collective responsibility” with DoJ to take action. Still, the report said DoJ “should take a leading role in the prosecution of the most serious violations of the laws protecting copyrights, trademarks and trade secrets.”

Many congressional leaders have criticized DoJ for not being aggressive enough in prosecuting IP crimes. House Judiciary Courts, Internet & Intellectual Property Subcommittee Chmn. Smith (R-Tex.), author of several IP bills, has said at hearings that he'd be introducing less legislation if DoJ were enforcing existing copyright law. The task force singled out one bill by Smith, HR-4077, which would lower the prosecutorial threshold for pursuing file sharers. “The passive sharing of copyrighted works for unlawful duplication should be treated as the distribution of those works and should, where appropriate, be subject to prosecution,” the task force wrote, following with a description of HR-4077. The report said copyright law shouldn’t distinguish between infringing works sold for profit and those given away, the distinction underlying HR-4077. The task force also said that copyright law should treat prerelease works as holding greater value, and mentioned HR-4077 and S-1932 by Sens. Cornyn (R-Tex.) and Feinstein (D-Cal.), both of which do that. HR-4077 has cleared the House and is pending on the Senate floor, but Senate Commerce Committee Chmn. McCain (R-Ariz.) has a hold on the bill (see separate story, this issue).

The task force also endorsed the targeting “those who intentionally induce infringement.” That is the idea behind S-2560, a bill by Senate Judiciary Committee Chmn. Hatch (R-Utah) and ranking Democrat Leahy (Vt.) that has gone through innumerable revisions in an attempt to satisfy CE manufacturers, ISPs and consumer groups that the bill won’t deter innovation. “A copyright owner should have some express remedy against [P2P networks] and other businesses, to the extent that they depend upon and intend for their customers to violate the owner’s copyright,” the report said. It then mentions S-2560, without explicitly endorsing it. Hatch and Leahy have said the bill is needed because the Grokster decision prevents legal action against P2P software providers; content groups have appealed Grokster to the U.S. Supreme Court.

A bill promoting fair use is also mentioned, in an unfavorable context. HR-107 by Boucher would permit circumvention of copy-protection mechanisms if the use is noninfringing. But the task force, in a section mentioning HR-107, wrote “the circumvention of technological safeguards protecting copyrighted works should be subject to prosecution... Federal law should reinforce the use of these technological safeguards by preventing their deliberate and unauthorized circumvention.”

RIAA, MPAA, the Business Software Alliance and the International Intellectual Property Alliance praised the report. RIAA Chmn. Mitch Bainwol commended existing DoJ online piracy initiatives, while MPAA Pres. Dan Glickman and BSA Pres. Robert Holleyman supported the idea of more CHIP units and more law enforcement.

But the Distributed Computing Industry Assn. argued that new business models from the content industry, not more law enforcement, were the answer. DCIA represents P2P software makers and related companies, and Pres. Marty Lafferty said consumers should be allowed to continue to copy CDs and DVDs and share them on P2P networks. Third- party technology could ensure copyright owners were protected, he said. He commended Israelite and his team for the report, and said he supported the sections targeting “serious organized piracy for criminally commercial purposes.” But he said “we stop short of equating young people sharing music files for no commercial gain with drug traffickers and terrorists, however. No harm has been causally demonstrated to the entertainment industries from P2P thus far, and numerous studies demonstrate a promotional benefit.”