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Subcommittee is pro PRO-IP Act (Updated) - March 6, 2008

The House intellectual property subcommittee passed the PRO-IP Act by voice vote Thursday, thanks to some pre-markup deal-cutting that removed one of its most controversial provisions, at least for now. Gone from the bill is Section 104, which would have changed how statutory damages are calculated in cases where the infringement involves a compilation of works. But the provision's supporters, notably subcommittee chairman Howard Berman (D-CA) vowed to revisit the issue in subsequent legislation.

Under current law, the unauthorized copying of a compilation is treated as a single act of infringement for the purposes of calculating damages, which can be as high as $150,000 per count. At the request of the RIAA, however, language was originally inserted in the bill to change that formula so that each individual work in a compilation is counted. Thus, copying a CD with 10 tracks on it would count as 10 separate infringing acts, bringing potential damages of $1.5 million, instead of a single count worth $150,000.

Opponents of the provision argued that such massive potential liability would deter technology innovators from working in areas that carried any risk of attracting infringement litigation.

The provision was not part of the original proposal for the PRO-IP Act put forward last fall by the Coalition Against Counterfeiting and Piracy (CACP), which includes a broad range of industry and labor groups.

Berman said he had agreed to remove the provision to keep the bill moving but vowed to revisit it later.

"We need a little more time to work out the right language there," he said of the measure.

Rep. John Conyers, Jr. (D-MI), chairman of the full Judiciary Committee and another chief sponsor of the bill, concurred. "The disaggregation issue isn't going anywhere," he said. "It still needs to be addressed and we will be addressing it."

While the provision's removal is a blow to the RIAA, the situation could get even more complicated for content owners if and when its sponsors bring a new bill.

At Thursday's markup, Rep. Zoe Lofgren (D-CA) insisted that any separate measure to address the disaggregation issue be taken up "in the context of HR 1201," the Freedom and Innovation Revitalizing U.S. Entrepreneurship (FAIR USE) Act introduced last year by Lofgren and Rep. Rick Boucher (D-VA).

That bill would loosen some of the anti-circumvention provisions of the Digital Millennium Copyright Act and is fiercely opposed by the RIAA and MPAA, among others.

Combining HR 1201 with a disaggregation bill could pose a difficult choice for content owners: how hard to push for passage of a disaggregation measure if it also means watering down the DMCA? It's not clear that all content owners would come down on the same side of that one.

UPDATE: Statements on the Subcommittee's action have been pouring in all day. Some examples:

• Public Knowledge: "We are pleased that the Subcommittee deleted from the bill the section (Section 104) that would have allowed multiplied damages for infringement of a compilation far beyond any reasonable levels.  We are also pleased that the Subcommittee amended the bill to require that the Justice Department show a ‘substantial connection’ between the property it seeks to have forfeited and the infringing activity. This change would protect against a defendant having property taken by the government, such as a car or a home, which has only the most tangential relationship to infringing activity."
• National Music Publishers' Assn: "Today’s action represents important progress for everyone concerned about better enforcement of America’s intellectual property rights...This bill will go a long way towards making sure law enforcement agencies have what they need to get the job done on both domestic and international fronts. Music publishers and songwriters are grateful for the leadership and commitment of the IP Subcommittee on behalf of America’s creative community."
• Copyright Alliance: “We applaud the efforts of the House Judiciary Committee and in particular the leadership of the IP Subcommittee to continue pressing for better, more effective, more efficient enforcement of America’s intellectual property rights...[We are] particularly pleased that the bill was not amended to include any of the anti-copyright provisions we have raised previously with the Subcommittee."
• NBC Universal: "We applaud the subcommittee for unanimously approving and moving forward with the PRO IP Act, legislation that will dramatically advance the cause of protecting U.S. innovation, technological invention, and creativity. The high-level executive leadership and dedicated prosecutorial, investigative, and international resources mandated in H.R. 4279 are the critical resources we need to raise the priority of IP enforcement on many fronts."

The most interesting statement so far, thought, comes from the RIAA, mostly for what it doesn't say. Having pushed to include the provision increasing statutory damages for compilations, the music industry group said nothing in its statement about the provision being removed from the bill.

• RIAA: "We are grateful for the widespread support within the Subcommittee for this important legislation. With this vote, Congress has taken the first legislative step toward enacting a common sense bill that closes needless loopholes in the copyright laws and provides more resources to the federal government and law enforcement to fully address intellectual property theft. This is great news for the music community and all businesses that rely upon intellectual property laws."

You can just feel the excitement, can't you?

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