Senate Judiciary Committee Approves IP Enforcement Bill

September 11, 2008. The Senate Judiciary Committee (SJC) amended and approved S 3325 [LOC | WW], the "Enforcement of Intellectual Property Rights Act".

Sen. Patrick Leahy (D-VT), Sen. Arlen Specter (R-PA), Sen. Evan Bayh (D-IN), and Sen. George Voinovich (R-OH) introduced this bill on July 24, 2008. Sen. Leahy and Sen. Specter are the Chairman and ranking Republican on the SJC.

On September 11, the SJC approved a manager's amendment [15 pages in PDF] offered by Sen. Leahy, an amendment [1 page in PDF] offered by Sen. Charles Grassley (R-IA), and a second amendment [2 pages in PDF] offered by Sen. Grassley. See also, S 3325 as introduced in PDF, for page numbers referred to by amendments.

Sen. Leahy stated that "We all know that intellectual property makes up some of the most valuable, and most vulnerable, property we have. We need to do more to protect it from theft and abuse if we hope to continue being a world leader in innovation. I am pleased the Committee has reported this legislation, which will provide the tools, resources, and structure needed for law enforcement at all levels to protect our intellectual property and to prosecute those who steal it."

This bill deals primarily with private remedies under, and government enforcement of, copyright and trademark laws. It contains sections that are similar to sections in the PRO IP Act, which the House passed in May. Neither the Senate, nor the SJC, have taken any action on that House bill.

On May 7, 2008, the House approved HR 4279 [LOC | WW], the "Prioritizing Resources and Organization for Intellectual Property Act of 2007" or "PRO IP Act", by a vote of 410-11. See, Roll Call No. 300. See also, story titled "House Passes PRO IP Act" in TLJ Daily E-Mail Alert No. 1,763, May 8, 2008.

See also, story titled "Representatives Introduce PRO IP Act" in TLJ Daily E-Mail Alert No. 1,683, December 5, 2008; story titled "House Subcommittee Amends PRO-IP Act" in TLJ Daily E-Mail Alert No. 1,727, March 05, 2008; and, story titled "House Judiciary Committee Approves PRO IP Act" in TLJ Daily E-Mail Alert No. 1,758, May 1, 2008.

S 3325 (at Section 101) would enable the Department of Justice (DOJ) to bring civil actions for copyright infringement. Currently, the government can only bring criminal actions, pursuant to 17 U.S.C. § 506, or decline to take action.

This bill would add a new §506a. This option would both lower the burden of proof for the government, and reduce the range of penalties for, and diminution of reputation to, the defendant infringer. The House PRO IP Act contains a similar provision.

S 3325 (at Section 201), as amended, contains a copyright registration harmless error exception. That is, it would amend 17 U.S.C. § 411 to provide that "A certificate of registration satisfies the requirements of this section and section 412, regardless of whether the certificate contains any inaccurate information, unless -- (A) the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate; and (B) the inaccuracy of the information, if known, would have caused the Register of Copyrights to refuse registration." The House PRO IP Act contains a similar provision.

S 3325 (at Section 202) would amend 17 U.S.C. § 503, regarding "Remedies for infringement: Impounding and disposition of infringing articles" to allow a court to order the impounding of "records documenting the manufacture, sale, or receipt of things involved" in a violation. Currently, only infringing items, and things used to make infringing items can be impounded.

The manager's amendment contains language to protect individual privacy. It adds that "For impoundments of records ... the court shall enter an appropriate protective order with respect to discovery and use of any records or information that has been impounded. The protective order shall provide for appropriate procedures to ensure that confidential, private, proprietary, or privileged information contained in such records is not improperly disclosed or used."

Sen. Leahy explained that "we heard very recently a concern about the privacy interests of innocent third parties if, for example, law enforcement were to seize computer servers. To make doubly sure that such interests are protected, we have added mandatory, court-issued protective orders under any circumstances involving records to the protections already employed through the warrant process."

S 3325 (at Section 203) would amend the Trademark Act to allow for the award of treble profits or damages for use of a counterfeit mark or designation.

S 3325 (at Section 204) would amend the Trademark Act, at 15 U.S.C. § 1117, to increase statutory damages in counterfeiting cases.

S 3325 (at Section 205) would amend the Trademark Act, at 15 U.S.C. § 1124, which currently pertains to "Importation of goods bearing infringing marks or names forbidden", to also cover transshipment and exportation.

The bill would create a new Intellectual Property Enforcement Coordinator (IPEC) in the executive branch. The IPEC would be appointed by the President, and confirmed by the Senate.

Sen. Grassley's first amendment adds the Department of Agriculture to a list of federal agencies with membership on an interagency intellectual property enforcement advisory committee that would be created by the bill.

His second amendment pertains to the transition from current NIPLECC to the new IPEC.

The vote on approval of the bill as amended was 14-4. Four SJC members voted against the bill: Sen. Jon Kyl (R-AZ), Sen. Jeff Sessions (R-AL), Sen. Sam Brownback (R-KS), and Sen. Coburn (R-OK). Sen. Joe Biden (D-DE) was not present.

Patrick Ross, head of the Copyright Alliance, praised the bill in a release. He wrote that "While today’s action is great progress for creators everywhere, time is running short. It is imperative the full Senate acts quickly to approve this important piece of legislation, and that the House pass the same bill. With our economy at its lowest point in years, we need the economic stimulus of anti-piracy actions, and we need copyright enforcement legislation on the President’s desk this year."

On September 10, 2008, a collection of interest groups that traditionally support a weakening of intellectual property rights, remedies and government enforcement wrote a letter criticizing the bill.

With respect to civil enforcement actions, the letter states that "Section 101 would be an enormous gift of federal resources to large copyright owners with no demonstration that the copyright owners are having difficulties enforcing their own rights. For example, the recording industry has threatened or filed over 30,000 lawsuits against individual consumers. Movie and television producers, software publishers, music publishers, and print publishers all have their own enforcement programs. There is absolutely no reason for the federal government to assume this private enforcement role."

The groups signing this letter include the Public Knowledge (PK), Electronic Frontier Foundation (EFF), the American Library Association (ALA), and others.

Dan Glickman, head of the Motion Picture Association of America, praised the bill in a release.