IP: BEFORE WIPO TREATIES ARE RATIFIED, CONGRESS SHOULD ADOPT

[David Farber <farber () cis upenn edu>]

Excellent job. djf


http://www.ari.net/dfc/docs/stwip.htm


BEFORE WIPO TREATIES ARE RATIFIED, CONGRESS SHOULD ADOPT COMPREHENSIVE AND
BALANCED IMPLEMENTING LEGISLATION


The Digital Future Coalition (DFC) welcomes President Clinton's submission
of the WIPO Copyright Treaty and the WIPO Performances and Phonograms
Treaty for ratification. That action presents an important opportunity for
Congress -- through the careful crafting and enactment of implementing
legislation -- to ensure the continuation of balance in copyright law and
policy as the nation moves into the next millennium. 


Since its inception, the DFC has urged policymakers domestically and
internationally to recognize the importance of both information creators
and users to the successful development of the emerging digital, networked
environment. The DFC believes that, just as the WIPO treaties recognize the
principle of balance between the interests of copyright owners and
information consumers, so should domestic law. 


Regrettably, the proposed implementing legislation (S. 1121/H.R. 2281)
introduced on behalf of the Administration in both Houses of Congress this
July is seriously deficient in several respects -- both as to the
provisions included, and equally to those omitted. 


Thus, while the DFC supports the WIPO treaties, we strongly oppose S. 1121
and H.R. 2281 in their current form as contrary to our long-held and
oft-stated commitment to balance in copyright law and policy. Far from
representing a compromise among stakeholders, as was suggested upon the
legislation's introduction, the proposed implementing legislation would
upset the balance that has characterized U.S. copyright law for decades.
The treaties should not be ratified until agreement is reached on
legislation that would maintain balance in America's copyright law. 


Concerns with the Proposed Legislation: 




Section 1201 of the proposed Act attempts to ban all devices that could be
used to circumvent technological measures designed to restrict access or
prevent unauthorized reproduction of copyrighted works. This provision
threatens to stifle innovation. Furthermore, whatever rights individuals
may have in theory under copyright law, such as fair use, would be
effectively negated by this far-reaching provision. 


Section 1202 threatens with liability even individuals who, without any
intention to infringe or promote infringement, incidentally alter copyright
management information designed to identify copyrighted works. Taken
together, sections 1201 and 1202 create significant risks to the privacy of
individual users of digital information networks. 


Just as significantly, a number of related issues -- fair use, first sale,
library preservation, distance education, service provider liability, and
the enforceability of non-negotiated license terms -- that should be
resolved to assure continued balance in U.S. copyright law are not
addressed by the proposed implementing legislation. 
SECTION 1201 -- STIFLING INNOVATION AND PUNISHING CONSUMERS 


Last year, the Clinton Administration proposed so-called "black box"
legislation that could have had serious consequences for the design of
future general purpose computers, digital VCR's and other recording
products. The DFC helped demonstrate to the 104th Congress that this
approach was overly broad and needlessly anti-innovation and anti-consumer.
Congress rejected the proposal. In December 1996, over 100 nations
attending the World Intellectual Property Organization (WIPO) diplomatic
conference rejected the same proposal. Instead, the WIPO nations adopted a
provision that merely requires countries to provide "adequate legal
protection . . . against the circumvention of effective technological
measures." 


With the introduction of its proposed treaty implementation legislation,
the Administration has again taken a broader approach that will punish
consumers, educators, librarians, researchers, and others by unreasonably
impairing the capability of multi-purpose devices. This approach will have
far-reaching negative ramifications for the future development and
exploitation of digital information networks like the Internet. 


Specifically, the proposed Act would: 




damage education and research by allowing copyright owners to "lock up"
public domain materials, and frustrate the "fair use" rights of information
consumers; 


impede encryption research which helps ensure secure networks; 


prevent legitimate "reverse engineering" in the development of new software
(effectively overturning a series of judicial decisions recognizing reverse
engineering as a legitimate "fair use"); 


outlaw, or force the redesign, of perfectly legitimate devices with
substantial non-infringing uses (effectively overruling the Supreme Court's
Betamax decision that spawned the VCR revolution to the benefit of all
American consumers); 


give judges the authority to second-guess manufacturers' decisions about
the best design for new generations of consumer electronic equipment and
computers; 


frustrate efforts to provide parents with the capability to monitor and
control children's on-line activities; and 


threaten the personal privacy rights of electronic consumers by penalizing
those who resist efforts to track their on-line usage. 


Of particular concern to DFC, violations of section 1201 are not tied to
infringement of any intellectual property right held by a copyright owner.
As a result, liability is imposed for "circumvention" even when the purpose
of the activity is permitted by the Copyright Act today -- as in cases of
fair use or access to public domain or non-copyrightable material. Such a
provision is unprecedented under copyright law. Furthermore, such an
extreme approach is not required by the WIPO treaties. In fact, this
approach is inconsistent with the preambles of the WIPO treaties, which
call for the recognition of the need to maintain balance between the rights
of copyright owners and "the larger public interest." 


The savings clause in Section 1201(d) does nothing to preserve this
balance; while Section 1201 will not as a formal matter restrict existing
limitations and exceptions to copyright, it will as a practical matter
preclude the exercise of these limitations and exceptions by preventing the
manufacture and use of the technologies necessary for their existence. Nor
would the savings clause protect individuals who gain "access" to works in
violation of 1201(a)(1), even if they do so for entirely lawful purposes. 


SECTION 1202 -- A TRAP FOR THE UNWARY 


The WIPO treaties do require enactment of domestic legislation to safeguard
the integrity of so-called "copyright management information" -- digitally
encoded data about the title, authorship, and ownership of works. Once
again, however, the proposed implementing legislation goes too far. Section
1202 includes, in addition to criminal penalties protecting CMI, civil
penalties applicable even in cases where no specific intent to infringe or
promote infringement can be shown. In other words, even someone who alters
digital identifiers casually could be liable for a minimum of $2,500 in
damages plus costs and attorney's fees. Neither the letter nor the spirit
of the WIPO treaties requires enactment of such an overreaching provision. 


Section 1202 also authorizes the Register of Copyrights to expand the
definition of copyright management information ("CMI") in the future. In
doing so, the Register "may not require the provision of any information
concerning the user of a copyrighted work." While a step in the right
direction, this language is not adequate to address genuine privacy
concerns about how personal information might be collected and used on the
Internet. The DFC thus will recommend that this provision be amended to
make explicit that the term "copyright management information" does not
include information that could be used (or misused) to identify the user of
a work or otherwise infringe on personal privacy. 


SECTIONS 1203 AND 1204 -- EGREGIOUS REMEDY PROVISIONS 


The proposed Act establishes civil and criminal penalties for violations of
sections 1201 and 1202. Most objectionable, section 1204 imposes criminal
penalties of up to $500,000 and 5 years of imprisonment for a single,
willful violation of section 1201 or 1202 for commercial advantage or
personal financial gain. A person could be subjected to these severe
criminal penalties simply for exercising fair use rights, if a court deems
the person acted for personal financial gain. 


SECTIONS OF OMISSION 


Just as the proposed implementing legislation would do too much, it also
would do too little. Since the release of the Administration's White Paper
on Intellectual Property and the National Information Infrastructure in
1995, a number of issues have emerged during the domestic discussion of how
to balance the rights of copyrights owners with the right to access in
copyright law and policy. These issues should be resolved in connection
with the WIPO treaties if a stable, balanced solution is to be achieved. 


Currently, a good start has been made in resolving the issue of on-line
service provider liability with the introduction of Representative Coble's
bill, H.R. 2180 the On-Line Copyright Liability Limitation Act. Although
DFC members believe that H.R. 2180 must be significantly modified to take
more fully into account the concerns of both commercial and non-commercial
access providers, we welcome this development. By contrast, other important
issues have yet to be addressed in any pending legislation. These issues
include: 




fair use: this traditional exception to the rights of copyright owners
should be reasserted in the digital information age; 


first sale: a digital equivalent to this important doctrine should be
created to ensure the realization of the potential of digital information
networks; 


library preservation: libraries should be permitted to continue the same
sorts of archival activities which they have relied on in the print
environment; 


distance education: educators should be permitted to continue in the new
communications environment the important innovations they have already
begun (thanks to provisions of the 1976 Copyright Act) using conventional
broadcast and closed circuit technologies; and 


non-negotiated license terms: limits should be placed on use of such terms
(including so-called "shrink-wrap" and "click-on" licenses) to assure that
teachers, students, and other users are not forced to give up their use
privileges as a condition of access to works in digital (and non-digital
formats). 
To ensure balance in the Copyright Act, any legislative package
implementing the WIPO treaties should address these issues. Ratification of
the treaties should await agreement on such legislation. Unless all these
issues can be resolved, along with the issues of "anti-circumvention" and
CMI with which they are intertwined, none can truly be resolved. 


The need to move forward with copyright in cyberspace certainly is urgent,
but it is far more important for Congress to get it right. The DFC looks
forward to working with Congress and the Administration to enact
comprehensive legislation that ensures balance in the Copyright Act into
the next millennium. 


The Digital Future Coalition (DFC) is the result of a unique collaboration
of 38 of the nation's leading non-profit educational, scholarly, library,
and consumer groups, together with major commercial trade associations
representing leaders in the consumer electronics, telecommunications,
computer, and network access industries. The DFC is committed to striking
an appropriate balance in law and public policy between protecting
intellectual property and affording public access to it. 


August 1997