Copyright Office Releases Draft Version of Inducement Bill
September 3, 2004. The Copyright Office (CO) released a discussion draft version of S 2560, the "Inducing Infringement of Copyrights Act of 2004", on September 2, 2004. This version was drafted for the purposes of facilitating discussion and comments by interested entities.
Sen. Orrin Hatch (R-UT), Sen. Patrick Leahy (D-VT), and others introduced the original version of S 2560 in the Senate on June 22, 2004. See, story titled "Senators Introduce Bill to Amend Copyright Act to Ban Inducement of Infringement", in TLJ Daily E-Mail Alert No. 925, June 24, 2004.
On July 22, the Senate Judiciary Committee held a hearing on the bill. Sen. Hatch and Sen. Leahy are the Chairman and ranking Democrat. See, story titled "Senate Judiciary Committee Holds Hearing on Inducement Bill" in TLJ Daily E-Mail Alert No. 963, August 20, 2004.
On August 24, a group of opponents of the bill sent a proposed alternative version of the bill to the Committee. See, stories titled "Opponents of the Inducing Infringement of Copyrights Act Submit Alternative Proposal" and "Comparison of Hatch Leahy Inducement Bill and Opponents' Proposal", in TLJ Daily E-Mail Alert No. 966, August 25, 2004.
The original bill, the opponents' proposal, and the Copyright Office's discussion draft, all would add a new subsection (g) to Section 501 of the Copyright Act. Currently, 17 U.S.C. § 501 defines infringement of copyrights. For example, subsection (a) provides, in part, that "Anyone who violates any of the exclusive rights of the copyright owner as provided by sections 106 through 121 or of the author as provided in section 106A(a), or who imports copies or phonorecords into the United States in violation of section 602, is an infringer of the copyright or right of the author, as the case may be."
Section 106, in turn, enumerates the exclusive rights in copyrighted works. These are (1) the right to reproduce, (2) the right to prepare derivative works, (3) the right to distribute copies, (4) the right to perform publicly, (5) the right to display publicly, and (6) for sound recordings, the right to perform by digital audio transmission.
S 2560, as introduced by Sen. Hatch and Sen. Leahy is a short and simple bill. It would amend § 501 by adding the following:
"(g)(1) In this subsection, the term `intentionally induces' means
intentionally aids, abets, induces, or procures, and intent may be shown by acts
from which a reasonable person would find intent to induce infringement based
upon all relevant information about such acts then reasonably available to the
actor, including whether the activity relies on infringement for its commercial
(2) Whoever intentionally induces any violation identified in subsection (a) shall be liable as an infringer.
(3) Nothing in this subsection shall enlarge or diminish the doctrines of vicarious and contributory liability for copyright infringement or require any court to unjustly withhold or impose any secondary liability for copyright infringement."
The Copyright Office's (CO) discussion draft maintains the basic provision that intentionally inducing infringement is akin to infringement, but makes several important changes.
Subsections (g)(1) and (2) of the original bill provide a definition of "intentionally induces", using a reasonable person standard, and provide that whoever intentionally induces a violation of § 501(a) is liable as an infringer. Subsection (g)(1) of the CO's discussion draft provides that whoever "intentionally induces another to infringe any of the exclusive rights in Sections 106(3), 106(4), 106(5) or 106(6) under subsection (a) shall be liable as an infringer".
While the original bill refers back to § 501(a), which in turn refers to all of the exclusive rights in §§ 106 through 121, the CO's discussion draft refers back to only subsection (3) through (6) of § 106. For example, Subsection 106(2) provides copyright holders have the exclusive right to prepare derivative works. Intentionally inducing infringement of derivative works would be treated as infringement under the original bill, but not under the CO's discussion draft. Currently, the music and movie industries do not face a serious threat from peer to peer infringement in derivative works.
The CO's discussion draft also adds the element of "overt acts", which is not present in the bill as introduced. It provides that "induces" means "to commit one or more affirmative, overt acts that are reasonably expected to cause or persuade another person or persons to commit any infringement under subsection (a) of this section."
The CO's discussion draft then enumerates five categories of "overt acts" for the purposes of inducement. However, this is not an exhaustive list. The discussion draft states that, "For the purposes of this subsection, ``overt acts´´ constituting inducement may include ..." (Emphasis added.) The discussion draft then enumerates six categories of acts that do not constitute "overt acts" for the purposes of inducement.
Neither the bill as introduced, nor the CO discussion draft references peer to peer systems. However, the list of overt acts includes five acts which are characteristic of currently available peer to peer software that is used to infringe copyrights in music recordings.
The list of predicate overt acts includes "distributing any dissemination technology that, when used as intended, automatically causes the user of the technology to infringe copyrighted works without the user making a specific, informed decision, for each copyrighted work at issue, about whether to engage in such infringement". It also includes "actively interfering with copyright holders' efforts to detect infringing uses of dissemination technology and enforce their copyright against those uses".
It also includes "distributing a dissemination technology as part of an enterprise that substantially relies on the infringing acts of others for its commercial viability or the revenues of which are predominantly derived from the infringing acts of others."
The CO's discussion draft then lists acts that do not constitute predicate overt acts for the purposes of the bill.
First, it lists "distributing any dissemination technology capable of substantial noninfringing uses knowing that it can be used for infringing purposes, so long as that technology is not designed to be used for infringing purposes".
This relates to the Supreme Court opinion in Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984), which is also know as the Betamax case. In that case the Court held that Sony was not vicariously liable for infringement by Betamax users because the Betamax was capable of commercially significant noninfringing uses, because consumers used it for time shifting, which is a fair use. Although, the CO discussion draft substitutes the word "substantial" for the Court's words "commercially significant". The CO discussion draft also adds the qualifier, "so long as that technology is not designed to be used for infringing purposes", which is not found in the Supreme Court's opinion.
The CO discussion draft also provides that "Nothing in this subsection shall enlarge or diminish the doctrines of vicarious and contributory liability for copyright infringement, including any defenses thereto or any limitations on rights or remedies for infringement, or the authority of courts to apply or adapt common-law standards."
The CO's discussion draft's enumeration of acts that do not constitute "overt acts" also includes "providing products or services to a distributor of dissemination technology in the same manner that such products or services are provided to other members of the public, including but not limited to financial services, delivery services, advertising services, product reviews or evaluations, library services, real estate services, customer-support services for users of computer software or hardware, utilities and telecommunications services."
The related language in the opponent's proposal is that "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 ..."
Perhaps it is notable that while both lists are long, nobody appears to be interested in exempting lawyers from liability for inducing infringement.
On September 3, 2004, Alan Davidson of the Center for Democracy and Technology (CDT) wrote a letter [2 pages in PDF] to the CO's Jule Sigall regarding the CO's discussion draft.
He wrote that "we believe the draft circulated by the Copyright Office yesterday falls short of the goals put forward by the Committee and raises serious concerns about chilling valuable new technologies for accessing and communicating information in the digital age."
He continued that "our major concern is overbreadth. A broad range of technology developers and service providers, who provide consumers with valuable opportunities to speak and to access information, could credibly be the target of costly and harmful litigation under this draft as written."
Also on September 3, 2004, Mike Godwin of Public Knowledge wrote a letter to Jule Sigall in which he stated that the CO discussion draft "appears to sweep up virtually all communications technology -- from e-mail to web browsers to Internet routers -- then appears to attempt to exclude from liability some types of ``good´´ technology. This approach strikes us as a backwards one that leads to overbreadth of potential liability even as it departs from the useful notion of focusing on potential defendants' intentions."
"Given how little of the discussion draft actually addresses the precise question of infringement-inducing peer-to-peer companies, we are left with a looming question: What is the real focus of the language of the discussion draft?" Godwin added, "Is there some other class of actor or behavior that the discussion draft wishes to target ..."
Public Knowledge supports the opponents' proposal.
Alan Davidson is Associate
Director of the CDT. Mike Godwin is the Legal Director of Public Knowledge. Jule
Sigall is Associate Register for Policy and International Affairs at the
Copyright Office. Richard Phillips and Tom Sydnor are Senate Judiciary Committee
staff members involved in discussions regarding S 2560.