- The Senate Judiciary Committee will consider a bill Thursday
that would hold technology companies liable for any product they make that
encourages people to steal copyright materials.
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- Critics say the bill would effectively outlaw peer-to-peer
networks and prohibit the development of new technologies, including devices
like the iPod. The Inducing Infringement of Copyrights Act was introduced
last month by Sen. Orrin Hatch (R-Utah), head of the Senate Judiciary Committee.
The legislation would hold a company liable that "intentionally induces"
a person to infringe copyright.
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- "We think this is a recipe for disaster for the
Internet," said Markham Erickson, general counsel for NetCoalition,
a public policy group that represents Internet companies like Google, Yahoo
and Internet service providers. "The bill as it is currently drafted
is extremely broad and not entirely clear. It would, at a minimum, undermine
the Sony Betamax decision."
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- In the Betamax decision, the Supreme Court ruled that
any technology that people use for legal purposes would be legal -- even
if the device could be used for illegal purposes, like content piracy.
Because of the ruling, the consumer electronics industry and Hollywood
went on to develop a thriving market in home video and DVDs.
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- "This takes an objective standard and replaces it
with a subjective one that allows a copyright holder to try and determine
the intent of a company when producing a product," Erickson said.
"It's not outside the realm of possibility that you would be placing
the entertainment industry in charge of technological innovation if this
law were passed."
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- It's the biggest threat to technology in 20 years, said
Jeff Joseph, a spokesman for the Consumer Electronics Association. The
organization's president will testify before the committee.
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- The judiciary committee will also hear testimony from
Register of Copyrights Marybeth Peters and the heads of the Business Software
Alliance and the Recording Industry Association of America. A representative
from the IEEE-USA's intellectual-property committee and the director of
NetCoalition will also testify.
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- One supporter of the bill, RIAA chief Mitch Bainwol,
is expected to include information about the music trade group's recent
settlement with iMesh, a company that makes file-trading software, in his
testimony. On Tuesday, the RIAA announced that iMesh agreed to pay record
companies $4.1 million for copyright infringement. The company also said
it will modify its business to prevent consumers from illegally sharing
or downloading songs.
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- Critics said the bill is the wrong fix for the piracy
problem.
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- "This bill really creates a huge risk that people
won't bring new products to market because they will be afraid to be sued
out of existence," said Mike Godwin, legal director of Public Knowledge,
which is opposed to the bill and is submitting written testimony to the
committee. "We keep asking, 'What's the rush?' It's not clear that
everything has to be wrapped up in the summer of 2004."
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- Godwin said Senate judiciary staff are eager to get the
legislation moving because they are worried that a federal appeals court
in California will uphold an April 2003 court decision that did not hold
peer-to-peer companies liable for their users' copyright infringement.
The so-called Grokster case was argued before the 9th U.S. Circuit Court
of Appeals in February, and a decision is expected soon.
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