Draft of Amendment in the Nature of a Substitute for S 2560.
Drafted by various opponents of S 2560.
Date: August 24, 2004.
Source: Public Knowledge.

DRAFT AMENDMENT NO. ____________
Calendar No. ____

Purpose: To discourage individuals from encouraging mass, indiscriminate copyright infringement; to encourage innovation and technological development; and for other purposes.

IN THE SENATE OF THE UNITED STATES

To amend chapter 5 of title 17, United States Code, relating to inducement of copyright infringement, and for other purposes.

Referred to the Committee on __________________ and ordered to be printed

Ordered to lie on the table and to be printed

AMENDMENT intended to be proposed by _____________________

Viz:

Strike all after the enacting clause and insert:

"SECTION 1. SHORT TITLE.

"This Act may be cited as the ‘Discouraging Online Networked Trafficking Inducement Act of 2004’.

"SEC. 2. INDISCRIMINATE, MASS INFRINGING  DISTRIBUTION OF COPYRIGHTED WORKS.

"Section 501 of title, 17, United States Code, is amended by adding at the end the following:

"(g)(1) Whoever actively distributes in commerce a computer program that is specifically designed for use by individuals to engage in the indiscriminate, mass infringing distribution to the public of copies or phonorecords of copyrighted works over digital networks, with the specific and actual intent to reap financial gain by encouraging such individuals to engage in such indiscriminate, mass infringing distribution, shall be liable as an infringer.

"(2) For purposes of this subsection and without limiting such other evidence as may be relevant to demonstrating whether a person had the specific and actual intent necessary to violate paragraph (1), a person shall not be deemed to have such specific and actual intent unless--

"(A) the predominant use of the computer program is the mass, indiscriminate infringing redistribution to the public of copies or phonorecords of copyrighted works;

"(B) the commercial viability of the computer program depends on, and the predominant revenues derived by the distributor from the computer program are derived from, its use for such mass, indiscriminate infringing redistribution; and

"(C) the person has undertaken conscious, recurring, persistent, and deliberate acts that encouraged another person to commit such mass, indiscriminate infringing redistribution or absent a legitimate purpose actively interfered with the ability of copyright owners to detect and prosecute such mass, indiscriminate infringing  redistribution.

 "(3) Limitations on liability.

"(A) A service provider as defined in 17 U.S.C. 512(k)(1)(B) whose service is used by a third party to distribute or that facilitates a third party’s distribution of a computer program shall not be liable under paragraph (1) for providing or operating such service.

"(B) Actual or constructive knowledge of the use of a computer program is not sufficient to demonstrate the requisite specific intent under paragraph (1).

"(C) A person who is not a distributor of a computer program that is specifically designed for use by individuals to engage in the indiscriminate, mass infringing distribution to the public of copies or phonorecords of copyrighted works over digital networks shall not be liable under paragraph (1) notwithstanding any contribution to or benefit from such distribution.  By way of example and not limitation, providing—

"(i) venture capital, financial assistance, payment services, or financial services,

"(ii) advertising, advertising services, or product reviews, or

"(iii) information or support to users, including via manuals and user handbooks pertaining to a computer program, assistance or directions for using such a program through a company’s online help system or telephone help services, and library services shall not be a basis for liability under paragraph (1).

"(D) In or as part of a consumer electronics or information technology product or service, providing navigation or access functions, recording functions, storage capacity, electronic program search and indexing functions, or an electronic program guide shall not separately or in combination be a basis for liability under this paragraph.

"(E) An email function does not provide mass, indiscriminate distribution of a work.

"(4) In any action under paragraph (1), the facts supporting such allegation must be pleaded with particularity.

"(5) Remedies for a violation of paragraph (1) shall be limited to—

"(A) an injunction against such intentional commercial activity; and

"(B) actual damages for infringement of a work for which the defendant had specific and actual knowledge the work would be infringed.".

"SEC. 3. REMEDIES FOR BASELESS LAWSUITS.

"In any civil action brought under section 501(g)—

"(a) The court shall allow recovery of full costs, including reasonable attorney's fees, by the prevailing party; and

"(b) Monetary sanctions under Rule 11, Federal Rules of Civil Procedure, shall be trebled."

"SEC. 4. CODIFICATION OF SUPREME COURT PRECEDENT.

"Except as provided under section 501(g)(1), it shall not be a violation of the Copyright Act to manufacture or distribute a hardware or software product that is capable of commercially significant noninfringing use.".