IPEC Recommends Tougher Penalties to Curb IP Crimes
Enhanced penalties for intellectual property crimes are necessary to increase the effectiveness of U.S. enforcement efforts, said White House Intellectual Property Enforcement Coordinator Victoria Espinel. Specifically, Congress should impose felony penalties for illegally streaming content and increase the U.S. sentencing guideline ranges to “address the substantial harm” caused by IP theft, Espinel wrote in a report to Congress Tuesday.
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Current U.S. law lacks teeth to prosecute website operators that illegally stream movies, music and other intellectual property, Espinel said in her report. “To ensure that Federal copyright law keeps pace with infringers and to ensure that DOJ and U.S. law enforcement agencies are able to effectively combat infringement involving new technology, the Administration recommends that Congress clarify that infringement by streaming, or by means of other similar new technology, is a felony in appropriate circumstances,” Espinel wrote.
The MPAA and U.S. Chamber of Commerce voiced support for many of the IPEC’s recommendations and specifically advocated for illegal streaming to be defined as a felony. “Closing the legal gap between two methods of equally destructive illegal behavior, unauthorized downloading and streaming, adds more clarity to intellectual property law and, frankly, makes good common sense,” said MPAA COO Bob Pisano. “We also strongly support the white paper’s call for Congress to clarify that criminal copyright infringement through unauthorized streaming is a felony,” said Rob Calia, senior director of counterfeiting and piracy for the Global Intellectual Property Center at the U.S. Chamber of Commerce. “We know both the House and Senate are looking at this issue and encourage them to work closely with the Administration and other stakeholders to combat this growing threat,” he said.
Other recommendations in the report suggested that Congress raise the statutory maximum sentence for economic espionage to 20 years in prison from the current 15. Sentencing rules should also be enhanced for the transfer of trade, military, law enforcement or national defense secrets to foreign entities. Penalties under the Federal Food, Drug and Cosmetic Act should also be increased, particularly for counterfeit drugs, wrote Espinel. Furthermore, IP crimes committed by organized criminal enterprises and repeat offenders should be more strictly enforced, the report said.
The white paper also recommended that Congress create a right of public performance for sound recordings so copyright owners are compensated for radio broadcasts of their work. Broadcast radio stations are currently the only platform that doesn’t pay royalties to record labels. “The absence of such a right puts U.S. copyright owners at a disadvantage internationally. They are not permitted to collect overseas royalties because they are not granted rights in the U.S.,” wrote Espinel.
The response was mixed to the public performance right recommendation. The NAB condemned the IPEC’s call for legislation on grounds that it would unfairly burden radio stations that play music. On the other side, Public Knowledge commended Espinel’s focus on an “often overlooked” issue in the IP debate. “We note as well her advocacy on behalf of a public performance right for copyright owners for material which is broadcast,” said President Gigi Sohn. “While this seems tangentially related to an enforcement agenda, performing artists deservingly stand to benefit from such a system.”