PRO-IP Act Markup Pulls ‘Compilation’ Provision, Narrows Forfeiture

Lawmakers met with “almost every facet” of the copyright industries and user groups in a daylong event after the polarized December hearing, said Subcommittee Chairman Howard Berman, D-Calif. “It was clear more time was needed to identify the appropriate legislative solution” to the issue of disproportionately low damages for infringing compilations, he said, promising “ongoing discussions” on a substitute provision. Ranking Member Howard Coble, R-N.C., said Section 104 had been the only provision keeping him from signing on, and Rep. Darrell Issa, R-Calif., said he appreciated the excision. A forfeiture provision that could “ensnare materials and devices that may have only had a fleeting connection” to infringement also has been narrowed, to require a “substantial connection” to piracy, Berman said, crediting Public Knowledge with raising the issue.

Industry groups agreed to a compromise on the focus of the “joint strategic plan” to be led by a new Intellectual Property Enforcement Representative in the Executive Office of the President, Berman said. The original bill language called for “identifying individuals, financial institutions, business concerns and other entities” engaged in piracy. The manager’s amendment focuses on “identifying and addressing structural weaknesses, systemic flaws, or other unjustified impediments to effective enforcement action.” Berman ribbed agencies affected by the bill for not working with the subcommittee “as quickly or productively as I would have hoped,” but said committee leaders would be “incorporating a number of their recommended changes.”

Rep. Zoe Lofgren, D-Calif., cited “continuing concerns” over provisions but promised not to offer amendments at the markup. The amended forfeiture provision still would endanger an “innocent owner’s property” even when it has been used to commit piracy without the owner’s knowledge, she said: “There should at least be a knowledge component or a willfulness component.” Rep. Melvin Watt, D-N.C., voiced worry about the new “two-tier” structure of forfeiture, which adds civil penalties and “starts to raise red flags about due process.” He wants protections to mitigate “abuse” in civil forfeiture considered at the committee.

Lofgren worries about the IP Enforcement Representative having “co-equal” status with the U.S. Trade Representative, she said. But she credited leaders with limiting the new office’s authority, which originally involved recommending changes in IP statutes and regulations in its annual reports. The amendment limits those recommendations to “enforcement” rules, not IP laws in general. Lofgren said she can’t support the bill’s structural changes to DoJ, which would create an Intellectual Property Enforcement Division in the deputy attorney general’s office and transfer to it IP protection duties now assigned to the Computer Crime and Intellectual Property Section of DoJ’s criminal division. Lofgren said shielding copyright owners from loss of protection due to “harmless” registration errors, unchanged by the amendment, would discourage creators from registering works with the government, worsening the orphan-works problem. The IP Subcommittee set a March 13 hearing on orphan works.

Judiciary Ranking Member Lamar Smith, R-Tex., complained to Berman that the IP Subcommittee markup ran concurrently with those of other subcommittees, perhaps preventing some IP Subcommittee members from having a voice on changes to HR- 4279. To give his two cents’ worth Smith had to leave an engrossing Commercial and Administrative Law Subcommittee hearing, he said. Berman said he could do little to improve scheduling, noting his own frustrated attempts.

Copyright groups didn’t mention the manager’s amendment in lauding the subcommittee for passing the bill. Copyright Alliance Executive Director Patrick Ross is “particularly pleased” the subcommittee excluded “anti-copyright provisions” that had been targeted by rightsholders, he said, citing his group’s letter against inserting provisions from HR-1201, the FAIR USE Act (WID March 4 p4). Mitch Glazier, RIAA executive vice president of government and industry relations, said the vote signaled the first step toward “enacting a common sense bill that closes needless loopholes” in copyright law. National Music Publishers Association President David Israelite, a former DoJ attorney handling IP enforcement, said enacting the bill would “go a long way towards making sure law enforcement agencies have what they need” in the U.S. and abroad. MPAA Chairman Dan Glickman said the measure would “protect the many American business sectors and American workers that depend on intellectual property.”

The bill’s provisions “are the critical resources we need to raise the priority of IP enforcement on many fronts,” NBC Universal said. An executive at NBCU told us the company and Coalition Against Counterfeiting and Piracy, led by NBCU General Counsel Rick Cotton, “never… felt that strongly about” provisions altered by the manager’s amendment. The company and coalition didn’t include those subjects in its proposal last year and “there are much bigger things on the table here.”

Public Knowledge welcomed changes to the bill. The original compilation provision would have allowed infringement damages “far above any reasonable levels,” and the broad forfeiture section would have let the government take cars or homes with “only the most tangential relationship” to infringement, said President Gigi Sohn.