[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]
DIGITAL COPYRIGHT PIRACY:
PROTECTING AMERICAN CONSUMERS, WORKERS,
AND CREATORS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON COURTS, INTELLECTUAL
PROPERTY, AND THE INTERNET
OF THE
COMMITTEE ON THE JUDICIARY
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTEENTH CONGRESS
FIRST SESSION
__________
WEDNESDAY, DECEMBER 13, 2023
__________
Serial No. 118-57
__________
Printed for the use of the Committee on the Judiciary
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via: http://judiciary.house.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
54-399 WASHINGTON : 2024
-----------------------------------------------------------------------------------
COMMITTEE ON THE JUDICIARY
JIM JORDAN, Ohio, Chair
DARRELL ISSA, California JERROLD NADLER, New York, Ranking
KEN BUCK, Colorado Member
MATT GAETZ, Florida ZOE LOFGREN, California
ANDY BIGGS, Arizona SHEILA JACKSON LEE, Texas
TOM McCLINTOCK, California STEVE COHEN, Tennessee
TOM TIFFANY, Wisconsin HENRY C. ``HANK'' JOHNSON, Jr.,
THOMAS MASSIE, Kentucky Georgia
CHIP ROY, Texas ADAM SCHIFF, California
DAN BISHOP, North Carolina ERIC SWALWELL, California
VICTORIA SPARTZ, Indiana TED LIEU, California
SCOTT FITZGERALD, Wisconsin PRAMILA JAYAPAL, Washington
CLIFF BENTZ, Oregon J. LUIS CORREA, California
BEN CLINE, Virginia MARY GAY SCANLON, Pennsylvania
LANCE GOODEN, Texas JOE NEGUSE, Colorado
JEFF VAN DREW, New Jersey LUCY McBATH, Georgia
TROY NEHLS, Texas MADELEINE DEAN, Pennsylvania
BARRY MOORE, Alabama VERONICA ESCOBAR, Texas
KEVIN KILEY, California DEBORAH ROSS, North Carolina
HARRIET HAGEMAN, Wyoming CORI BUSH, Missouri
NATHANIEL MORAN, Texas GLENN IVEY, Maryland
LAUREL LEE, Florida BECCA BALINT, Vermont
WESLEY HUNT, Texas
RUSSELL FRY, South Carolina
Vacant
------
SUBCOMMITTEE ON COURTS, INTELLECTUAL PROPERTY, AND
THE INTERNET
DARRELL ISSA, California, Chair
THOMAS MASSIE, Kentucky HENRY C. ``HANK'' JOHNSON, Jr.,
SCOTT FITZGERALD, Wisconsin Georgia, Ranking Member
CLIFF BENTZ, Oregon TED LIEU, California
BEN CLINE, Virginia JOE NEGUSE, Colorado
LANCE GOODEN, Texas DEBORAH ROSS, North Carolina
KEVIN KILEY, California ADAM SCHIFF, California
NATHANIEL MORAN, Texas ZOE LOFGREN, California
LAUREL LEE, Florida MADELEINE DEAN, Pennsylvania
RUSSELL FRY, South Carolina GLENN IVEY, Maryland
CHRISTOPHER HIXON, Majority Staff Director
AMY RUTKIN, Minority Staff Director & Chief of Staff
C O N T E N T S
----------
Wednesday, December 13, 2023
Page
OPENING STATEMENTS
The Honorable Darrell Issa, Chair of the Subcommittee on Courts,
Intellectual Property, and the Internet from the State of
California..................................................... 1
The Honorable Henry C. ``Hank'' Johnson, Ranking Member of the
Subcommittee on Courts, Intellectual Property, and the Internet
from the State of Georgia...................................... 2
WITNESSES
Richard Gladstein, Academy Award nominated producer; President/
Founder, FilmColony; Executive Director, Brooklyn College
Feirstein Graduate School of Cinema
Oral Testimony................................................. 4
Prepared Testimony............................................. 7
Riche T. McKnight, General Counsel, Ultimate Fighting
Championship; Executive Vice President, Deputy General Counsel,
Co-Head, Litigation, Endeavor
Oral Testimony................................................. 10
Prepared Testimony............................................. 12
Matthew Schruers, President, Computer & Communications Industry
Association; Co-Founder/Board Chair, Digital Trust & Safety
Partnership
Oral Testimony................................................. 21
Prepared Testimony............................................. 23
Karyn A. Temple, Senior Executive Vice President, Global General
Counsel, Motion Picture Association; Former Register of
Copyrights and Director, U.S. Copyright Office
Oral Testimony................................................. 32
Prepared Testimony............................................. 34
LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING
All materials submitted by the Subcommittee on Courts,
Intellectual Property, and the Internet, for the record........ 68
Statement from the Association of American Publishers, Dec. 13,
2023, submitted by the Honorable Ben Cline, a Member of the
Subcommittee on Courts, Intellectual Property, and the Internet
from the State of Virginia, for the record
QUESTIONS AND RESPONSES FOR THE RECORD
Questions submitted by the Honorable Darrell Issa, Chair of the
Subcommittee on Courts, Intellectual Property, and the Internet
from the State of California, for the record
Questions for Karyn A. Temple, Senior Executive Vice President,
Global General Counsel, Motion Picture Association, Former
Register of Copyrights and Director, U.S. Copyright Office
Questions for Matthew Schruers, President, Computer &
Communications Industry Association, Co-Founder and Board
Chair, Digital Trust & Safety Partnership
A response from Karyn A. Temple, Senior Executive Vice President,
Global General Counsel, Motion Picture Association, Former
Register of Copyrights and Director, U.S. Copyright Office, for
the record
A response from Matthew Schruers, President, Computer &
Communications Industry Association, Co-Founder and Board
Chair, Digital Trust & Safety Partnership, for the record
DIGITAL COPYRIGHT PIRACY:
PROTECTING AMERICAN CONSUMERS, WORKERS, AND CREATORS
----------
Wednesday, December 13, 2023
House of Representatives
Subcommittee on Courts, Intellectual Property, and
the Internet
Committee on the Judiciary
Washington, DC
The Committee met, pursuant to notice, at 10:03 a.m., in
Room 2141, Rayburn House Office Building, the Hon. Darrell Issa
[Chair of the Subcommittee] presiding.
Members present: Representatives Issa, Fitzgerald, Bentz,
Cline, Kiley, Lee, Johnson, Nadler, Lieu, Ross, Lofgren, and
Ivey.
Mr. Issa. The Subcommittee will come to order. Without
objection, the Chair is authorized to declare a recess at any
time.
Today we would like to welcome this hearing on digital
copyright privacy. I will now recognize myself for a short
opening statement.
Today we are exploring the topic of copyright privacy in a
digital era. This is not a new subject. The Digital Millennium
Copyright Act is more than 20 years old. Yet, emerging
technologies and emerging threat have, in fact, caused us to
once again have to revisit the threat to this great industry.
In 2019, the industries involved in copyright employed
nearly nine million people, contributed at least $1.3 trillion
to the U.S. economy. Of these numbers, online piracy is
estimated to cost over 200,000 jobs and approximately $50
billion to our gross domestic product. You might ask, well, if
they are in commerce why it is not in our GDP, because for the
most part it goes to foreign countries, and it goes to
individuals who will never pay their taxes.
While copyright piracy used to be involved in back-alley
sales of ripped CDs, DVDs, or in my day the bootleg 8-track,
digital copyright piracy now involves amounts of infringing
content made widely available on the internet. Much of it is
given away for free, but not without a cost. The cost often
includes the spyware and, in fact, side advertising that pays
for giving away your rights free.
Unfortunately, many of these websites, like FMovies, are
hosted on servers that exist outside the United States,
currently outside our ability to take them down. This creates
unique judicial challenges for enforcement against widespread
privacy on such websites. In some cases, these websites are
even hosted within foreign governments, governments like the
Russian government on military bases and other enemies of the
United States.
It is vital to understand the important difference between
websites that happen to have infringing activities, websites
that may host those who, in fact, do not respect intellectual
property, and criminal websites who exist only for the purpose
of, in fact, giving away that which they did not buy and have
no rights to.
In this hearing, we want to explore possible solutions to
the worst of the worst, at least a way to minimize the
prevalence of this infringing content on these illegal sites.
These solutions could include requiring internet service
providers to permanently block piracy sites that host only or
substantially only infringing content. This is a very small
portion of all ISPs but a large portion of that which is stolen
on behalf of these individuals. Dynamic site blocking to
address privacy of live sports and entertainment for set
periods time may also be explored, working with platforms to
remove pirated content as soon as possible to better meet the
needs of live sports entertainment.
I want to particularly focus on that here today. I look
forward to the witnesses, because, in fact, notice and takedown
might be fine in a week, a day, or an hour, unless, in fact,
the event is only an hour or two along and one or two hours
means there is no effective takedown in the live broadcast.
Given the importance of this issue, I want to thank our
witnesses for appearing here today. I want to say it once and
for all. This Committee is the Committee of jurisdiction.
Inaction is not acceptable. We have to find solutions that work
for the intellectual property producers or we will not have the
robust industry in the future that we have today.
With that, I would like to recognize the Ranking Member for
his opening statement.
Mr. Johnson of Georgia. Thank you, Chair Issa. Thank you
for holding this very important hearing.
When the Barbie movie premiered earlier this year, it made
$155 million its first three days in U.S. theaters.
Internationally, it earned $359 million that first box office
weekend. Barbie ultimately brought an estimated nine million
new moviegoers to theaters according to a prescreening survey
done by the Quorum.
Industries like the film industry, ones that are reliant on
the exclusive authority to reproduce and distribute creative
derivative versions and--excuse me. Industries like the film
industry, ones that are reliant on the exclusive authority to
reproduce and distribute, create derivative versions, and
publicly perform a copyrighted work contributed $1.29 trillion
to the U.S. GDP in 2019. As the viewing public, we often hear
the most about those top line numbers. That is because box
office scores and tales of sold-out theaters make the news, but
they are only a part of the story.
Of those in this room who joined the crowds to see Barbie
in theaters, I bet few, if any of us, sat through and watched
as the credits rolled. If we had, we would have read the names
of just a few of the myriad individuals required to make a
movie. Yes, the film studios are the primary rightsholders of
the copyrighted work, and the actors and directors get most of
the world's attention. There are so many more people whose
livelihoods depend on the success of a film. Technicians,
writers, musicians, carpenters, engineers, artists,
programmers, and so many more add up to constitute the film
industry. The U.S. film and TV industries support and are
supported by millions of individuals employed by those sectors.
In 2019, copyright intensive industries in the United
States employed 6.6 million individuals directly and two
million more people through indirect employment. I say this all
not to diminish the importance of box office success, far from
it. It is important for us to remember that copyright law does
not just support the bottom line, but also the small creators
and industry workers. Copyright law itself may have little to
do with driving a truck or feeding hungry studio workers. These
are some of the people hurt by piracy of copyrighted works.
Digital piracy of film and television has increased since
2020. Between January-August 2022, there were 141.7 billion
visits to copyright piracy sites worldwide. Piracy has caused
an estimated annual loss of between 230,000 and 560,000 jobs in
the United States and between $47.5 and $115.3 billion in
reduced GDP. These are staggering losses to our creative
fields. They impact not just the stars and studio executives
but the many individuals who work in the industry. When
industries cannot afford to pay competitive salaries, students
look to different fields.
Piracy of copyrighted works is not a new problem. What
began as pirated DVDs back in the 1990s became a torrent of
files in the 2000s. Torrent files have now become streaming.
Today more than 80 percent of digital video piracy is conducted
via streaming where copies of movies, television, and other
copyrighted content are available in real time over the
internet.
Congress has acted to protect copyright dependent
industries before. From the moment personal computers landed in
homes around the world, we knew content piracy would be a
concern. That is why Congress passed Section 512 of the Digital
Millennium Copyright Act in 1998 to provide the opportunity to
protect copyrighted works on the internet.
I am looking forward to hearing from our witnesses how
notice and takedown works today, what challenges exist in
removing pirated content, and how changes in technology and the
internet itself have impacted how we think about copyright
protections overall.
I would also note that I know the stakeholders are not
limited to the people in this room. When Congress sets about to
solve or even examine an issue, we need to look at all the
facts and hear from everyone. We must approach any issue before
this Committee with the seriousness and diligence it deserves.
I am certain that my Chair will do that. This hearing is,
however, an important first step to examining the problem of
copyright piracy.
Finally, welcome to our witnesses. I look forward to
hearing from you today and appreciate your willingness to
testify before us. I thank the Chair once again. I yield back
the balance of--
Mr. Issa. I thank the Ranking Member. Without objection,
all other opening statements will be included in the record. It
is now my pleasure to introduce our witnesses.
Mr. Richard Gladstein is an Academy Award nominated
producer and Executive Director of Brooklyn College Graduate
School of Cinema and President and Founder of the motion
picture production company, FilmColony. He has produced or
executive produced films such as The Hateful Eight, Pulp
Fiction, the one that all us know of, The Cider House Rules,
Finding Neverland, among others. Welcome.
Mr. Riche McKnight is General Counsel of the Ultimate
Fighting Championship or UFC, an Executive Vice President,
Deputy General Counsel, and Co-Head of Litigation for Endeavor.
In addition to being UFC's parent company, Endeavor owns and
operates a number of other businesses spanning sports,
entertainment, advertising, and talent representation.
Mr. Matthew Schruers. Mr. Schruers is the President of the
Computer and Communications Industry Association where he leads
its advocacy on behalf of the internet, communications, and
technology companies. He is also Co-Founder and Board Chair of
the Digital Trust and Safety Partnership, which develops best
practices to foster a safer and more trustworthy internet.
A returning champion, to use the UFC terminology, Ms. Karyn
Temple. Ms. Karyn Temple is now the Senior Executive Vice
President and Global General Counsel of the Motion Picture
Association where she oversees the Association's legal affairs,
content protection efforts around the world. We knew her in her
previous roles as the U.S. Copyright Office, most recently
Register of Copyrights. Prior to leading the U.S. Copyright
Office, Ms. Temple headed the Office of Policy and
International Affairs.
I want to take just one more moment. All of you are
distinguished. To have somebody who has looked at clouds from
both sides now, so to speak, having been so key to determining
copyright and how it is to be inherently protected by
government and now seeing in one of the most fiercely
competitive areas, the stealing of copyright, is a real honor.
I want to thank you for all your service in both roles.
With that, I have to swear you in. Then we can begin. If
you would, please rise to take the oath.
Raising your right hand, do you solemnly swear or affirm
under penalty of perjury that the testimony you are about to
give will be the truth and correct to the best of your
knowledge, information, and belief so help you God?
Let the record reflect that all witnesses answered in the
affirmative. Please be seated.
We will now begin with Mr. Gladstein.
STATEMENT OF RICHARD GLADSTEIN
Mr. Gladstein. Chair Issa, Ranking Member Johnson, and the
distinguished Members of the IP Subcommittee, thank you for
your invitation to speak with you today on behalf of America's
creative community.
As the Chair said, I am a filmmaker and educator. I
produced such films as The Bourne Identity, Finding Neverland,
She's All That, The Cider House Rules, Pulp Fiction, among many
others. I am currently the Executive Director at Brooklyn
College's Feirstein Graduate School of Cinema, a part of the
City University of New York, where we are educating the next
generation of diverse storytellers.
Film and television production benefits a great many of our
cities and States. On average, for each and every day a film
shoots, approximately $250,000 is contributed to that local
economy. Small films generally shoot for about 24 days and
large ones for over 70 days. Throughout the U.S., our film and
television industries employ approximately 2.4 million
Americans. These numbers bear out what I have always known in
my heart to be true. Creativity is not just an important part
of American life. It is the backbone of our Nation's cultural
and economic strength.
Despite being a robust engine for the U.S. economy, our
industries have been besieged by digital piracy since the
inception of the internet. We have been fighting these illegal
activities with our hands tied behind our backs ever since.
I am not here today to speak about issues concerning fair
use or the use of clips from films or television shows or the
ways in which ideas or content are used by others in similar
works. Rather, I am going to confine my thoughts to the
wholesale theft and distribution of our movies and TV shows by
criminal enterprises, not facsimile or parts or replicas of our
work, but rather the entire and actual film or television
program.
Large scale piracy operations today are criminal
enterprises. They create internet sites that look deceptively
similar to legitimate streaming services. A recent study found
that as many as 30 million Americans use these illegal
streaming services often without realizing they are doing so.
The damages are significant, as another report found that
piracy causes losses of at least $29 billion and as much as $71
billion each and every year.
It has also been proven that digital piracy costs the U.S.
economy between 230,000 and 560,000 jobs every year. The vast
majority of these job losses and revenues affect the workers
behind the cameras, the production designers, costume
designers, cinematogra-phers, caterers, and every member of
their crews, including seamstresses, carpenters, electricians,
and more. These are well paid, skilled jobs for crafts people.
They often do not require a four-year college degree.
Many look at us as large corporations. These individuals,
again the backbone of our industry, are mostly freelance and a
part of the gig economy. Ninety-two percent of the businesses
in film and television employ fewer than ten people. Our
workers' pension and health plans are funded by residuals.
These residuals are derived from revenue and profits from
movies and television shows. Piracy is eviscerating these
profits.
So, why are we allowing hundreds of thousands of American
jobs to disappear each year? The truth is that most of the
piracy happening in the United States is occurring through
illegal services that are based overseas and beyond the reach
of U.S. law enforcement. Although there are laws in place
around the world that are proven to be effective against
piracy, these tools are not yet available to us here in the
United States.
One such effective tool allows courts to issue no-fault
injunctive relief or site blocking, creating orders that direct
internet service providers after a full judicial process to
block access to offshore websites that are found to be
dedicated to piracy. This tool is effective in more than 40
countries that have implemented it, including in Western
democracies like Canada, the U.K., and Australia.
There is a decade of evidence to support its effectiveness.
Numerous studies have shown that this tool reduces traffic to
pirate sites while also increasing traffic to legitimate and
legal sites, the sites that actually result in fair
compensation to creatives for their work. Early objections to
site blocking erroneously said it would be abused, could cause
harm to free speech, or break the internet. Creatives like me
are fierce advocates for free speech, and we would never call
for this important right to be blocked. When piracy is
diminished with effective laws, film financiers and creatives
will be able to realize the revenue they are entitled to.
As my time is running out, I will say that, in sum, I am
here to request that Congress find reasonable solutions, such
as site blocking, to curtail the theft and distribution of our
creative work. Those engaged in illegal behavior, as well as
internet intermediaries, that consistently aid and abet such
theft should be stopped and face penalties. Thank you for your
invitation to speak with you and your consideration of my
testimony.
[The prepared statement of Mr. Gladstein follows:]
[[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Issa. I thank the gentleman. We now go to Mr. McKnight.
STATEMENT OF RICHE T. McKNIGHT
Mr. McKnight. Chair Issa, Ranking Member Johnson,
distinguished Members of the Subcommittee, thank you for
inviting me to testify today.
My name is Riche McKnight. I am Executive Vice President
and General Counsel of the Ultimate Fighting Championship and
Deputy General Counsel and Co-Head of Litigation at Endeavor,
one of the world's largest sports, entertainment, and fashion
companies. I am honored to testified about the internet piracy
challenges that UFC faces as a provider of popular live sports
content. UFC appreciates working with Congress on this issue,
including the enactment of the Protecting Lawful Streaming Act
in 2020.
UFC is a preeminent content creator that hosts and airs
live mixed martial arts content, including through a pay-per-
view option in the United States in partnership with ESPN+. UFC
events are beloved and highly anticipated.
As explained in my written statement, a critical element of
UFC's content is that the essence of the event often involves
highly impactful but very brief moments in time, such as a
knockout in a fight or a well-executed move. These key moments
frequently last only minutes or even seconds.
Because UFC's content is so popular, UFC faces pervasive
piracy of its live content. Pirates record the live streams not
just through holding their phones up to a screen to record a
UFC event and livestream it, but also through more
sophisticated techniques resulting in HD quality video. The
pirates also brazenly advertise on social media platforms to
get viewers to come to their pirate websites with slogans like
Watch UFC Free. When people learn that they will be able to
access UFC content for free, they have no reason to purchase
UFC content via pay-per-view.
The problem is not unique to UFC. UFC recently submitted a
joint letter with the NBA and the NFL to the U.S. Patent and
Trademark Office that highlighted the challenges we all face
with respect to the piracy of live sports events. By one
estimate, the financial impact of online piracy across the
global sports industry is up to $28 billion in additional
potential annual revenue. UFC estimates that online piracy
diverts multiple millions of dollars from legitimate purchases
of UFC's content each year. In turn, this results in a
substantial loss of tax revenue and harms sports providers'
ability to host events that benefit local businesses and
communities.
UFC does the hard work to submit thousands of takedown
requests to a variety of online service providers during and
immediately after each UFC event. It has also engaged in
outreach to individual platforms. However, despite these
efforts, piracy persists. You have heard from and will continue
to hear from my co-panelists about site blocking. UFC supports
those efforts for the reasons that have already been discussed.
UFC has also identified a few additional solutions that I
will talk about today and that would significantly help address
the problem of piracy of live sporting events. First and
foremost, OSPs do not remove infringing livestreams and videos
expeditiously, as is required for them to attain a safe harbor
from liability for the infringement of their users under the
Digital Millennium Copyright Act. In fact, infringing
livestreams often stay online for a full UFC event. UFC has
found the OSPs exploit a lack of clarity in DMCA as to what it
means to remove content expeditiously, which clearly must
account for whether the request is time sensitive.
To put matters concretely, for each UFC pay-per-view event
between January of last year and this past November, UFC sent
thousands of takedown requests on average, even putting aside
infringing content that was automatically removed by certain
OSPs. For livestream content, 26 percent of infringing UFC
content was permitted to stay up for longer than one hour after
requests, a significant portion of a live event. Approximately
six percent of content was permitted to stay up for longer than
five hours. It is not uncommon for these streams to collect
hundreds of thousands or even millions of views while they are
available.
Congress can and should clarify that at least for time-
sensitive content like live sporting events expeditious removal
means that infringing content must be removed instantaneously
or near instantaneously. It is not enough if an infringing
livestream is left up until the live content ends.
Second, many OSPs have not adopted an effective process for
identifying and terminating repeat infringers, as is also
required for them to have a safe harbor under the DMCA. Too
frequently, UFC sees that after a user is terminated for repeat
infringement, that same user will create new accounts that are
obviously connected to the previous account. Clarification is
needed that a reasonable repeat infringer policy would among
other things involve account verification measures that prevent
the creation of new accounts by the same person and other
measures that would limit the ability of newly created accounts
to live stream for a certain period or reach a widespread
audience of viewers.
We recognize this continues to be an ongoing conversation
requiring input from all stakeholders. We hope to be able to
work with you and the Members of this Subcommittee going
forward. I want to thank the Subcommittee again for giving UFC
the opportunity to testify today. I would be happy to answer
any questions you may have. Thank you.
[The prepared statement of Mr. McKnight follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Issa. Thank you. Mr. Schruers.
STATEMENT OF MATTHEW SCHRUERS
Mr. Schruers. Chair Issa, Ranking Members Johnson, and the
Members of the Subcommittee, thanks for the invitation. It is
good to be with you again today. My name is Matt Schruers. I'm
President of CCIA.
For over 50 years, CCIA has been a voice for information,
communications, and technology firms. Products provided by our
members connect and empower users around the world, enabling
work and study in commerce and entertainment for billions. In
so doing, the digital sector is a proud and critical partner to
the creative industry. Widespread adoption of technology
products and services have created entirely new markets for the
legal consumption of content, permitting users to lawfully
enjoy digital media nearly anywhere at any time, generating
more revenue opportunities for creators than have ever existed
before.
Tech companies are themselves IP creators, spending
hundreds of millions of dollars on premium, award-winning
content and millions more licensing content from others for
lawful distribution. As leading providers of content and
licensees, they understand well the value of that investment.
It is the case that a small minority of bad actors' misuse
digital tools to infringe IP rights. The digital sector shares
the goal of preventing this. We must achieve this goal without
interfering with legitimate online commerce, communication, and
the Constitution. The most powerful tool to prevent
infringement is ensuring that consumers can lawfully access the
content they want, where they want it, when they want it on the
device want it. Products provided by American tech leaders are
making this possible.
Now, in addition, CCIA members regularly engage with
rights-
holders to identify and enforce against infringers, including
through extensive content moderation systems that go above and
beyond the notice and takedown that is currently contemplated
by Federal law. Now, automated filtering is not always
effective. It relies on third-party input, granular
information. It can be misused. It can result in over-removal
and over-enforcement against noninfringing content and fair
use, thus suppressing lawful expression. So, automated systems
do require human oversight and pairing the right solution with
the problem to ensure they function properly.
Policymakers should be wary of the proposal for online
enforcement that is DNS level site blocking. This approach
involves interfering with the basic architecture of the
internet to suppress content. This blunt instrument of
architectural regulation is inherently imprecise. It cannot be
achieved file by file or even country by country, but instead
disappears entire sites for the entire world. This puts far
more speech at risk of suppression, similar to closing the
Library of Congress over a single book. So, for that reason,
DNS level site blocking is not technically or constitutionally
possible to implement and certainly not without significant
collateral damage.
My written testimony describes in greater detail the EU's
website blocking system, which is littered with false
positives. It provides an instructive example of the unintended
consequences of policy. There is little transparency around
blocking orders and few ways to determine when content is being
withheld from the public by court order. This is why
technological experts like ICANN and the Internet Society have
strongly advised against DNS level blocking.
Now, election season is on us. It is prudent to recall that
political speech is frequently a target of wrongful copyright
allegations. In the last Presidential election, multiple
candidates were prevented from livestreaming their own speeches
due to dubious copyright claims. Campaign advertisements are
regularly accused of infringement. Whether inadvertent or
intentional, this cannot be tolerated in a democracy.
So, in conclusion, the more blunt the instrument, the
greater the risk to expression. So, we must calibrate solutions
appropriately. Nevertheless, CCIA members are committed to
fighting infringement by investing significant resources in new
products that give new opportunities to creators and create
better responses to infringement.
I look forward to your questions. Thank you.
[The prepared statement of Mr. Schruers follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Issa. Thank you. Ms. Temple.
STATEMENT OF KARYN TEMPLE
Ms. Temple. Thank you, Chair Issa, Ranking Member Johnson,
and the Members of the Subcommittee, for the opportunity to
testify today on behalf of the motion picture, television, and
streaming industries. Thank you for the very kind introduction
at the beginning.
The American motion picture and television production
industry is the world leader in this sector, distributing its
films and TV shows in over 130 countries. In 2021, the enduring
value and global appeal of the U.S. movie industry earned $14.4
billion in exports. Our industry is also a major U.S. employer
that supported 2.4 million jobs and $186 billion in total wages
in 2021.
The topic of today's hearing is an issue of critical
importance to our industry and to the many other industries
that are part of the creative sector, piracy of valuable
intellectual property.
Piracy, of course, is not a victimless crime as you have
heard. Piracy of filmed entertainment costs the U.S. economy
$29.2 billion in over 230,000 jobs annually. It does not just
affect big Hollywood studios and megastars. It affects everyone
who works in the industry, such as carpenters, electricians,
and hair stylists, as well as the businesses, as you heard most
of them small businesses, that provide related services, like
caterers, dry cleaners, and florists.
In addition, piracy services can directly threaten
Americans' personal and financial security, including exposing
everyday people to credit card fraud, identity theft, and
malware. Take FMovies, for example. It is a piracy website that
has been blocked in 16 countries and was referred to U.S. law
enforcement more than four years ago in 2019. It is still up
and accessible to millions of users in the United States.
If you would, please turn your attention to the screens.
Anyone can simply type the FMovies' URL into their favorite
browser today and an extremely professional and legitimate
looking site pops up. You can literally scroll through
thousands of movies and television shows, including this year's
blockbusters, and even movies that have not yet hit theaters.
You will see all our top-rated blockbusters and popular films.
Here you see coming up Wonka, which won't be out into the
United States' theaters until this Friday. It is just a click
away on this piracy streaming service. Also, notice the ads for
slotlights.net. That is an illegal online casino, likely
Russian, that is targeting U.S. consumers. Analysis shows that
this single piracy site had 168 million visits in just the
month of November. Most of these visits come from the United
States, accounting for roughly 38 percent of all users. This
means that this site was visited more than 64 million times by
people in the United States in just one month.
As you clearly saw from this video, this is not a
legitimate site that might include grandma's home movies or
public domain documentaries. This is a commercial-scale
operation whose sole purpose is to steal creative content and
funnel the proceeds back to criminal organizations. If we had
site blocking in the United States, as we do in the 16 other
countries where versions of this site had been blocked already,
then this piracy site's U.S. traffic would have plummeted,
protecting U.S. consumers and the U.S. creative sector, and
removing the financial incentives for piracy.
So, it is beyond time for Congress to revisit no-fault
injunctive relief to combat blatant forms of piracy. When
Congress a decade ago considered establishing an express
authority for such relief, opponents responded with the
unfounded prediction of potential harm to the internet. As a
result, Congress declined to move forward with legislation.
Much of the world enacted these tools despite the
overheated rhetoric. More than 40 countries, including leading
democracies, such as the U.K., much of Western Europe, Canada,
Australia, India, and South Korea, have enacted no-fault
injunctive relief regimes that expressly authorize courts or
administrative agencies to issue orders to ISPs to block access
to websites dedicated to piracy. These laws work. They
dramatically reduce visits to piracy sites. Even more
important, they result in more visits to legal sites.
None of the hyperbolic predictions about the effects of
site blocking have come true. Examples of over-blocking, that
is blocking of noninfringing content, or stifling free
expression or deprivation of due process have been rare to the
point of nonexistence. In fact, none of the examples of
purported over-blocking that CCIA cited in its testimony
actually involved a blocking order to an ISP because of
copyright infringement.
So, I am here today with some very good news. Effective
tools to combat piracy exist. The sky has not fallen. Despite
the widespread use of site blocking around the world, the
internet is emphatically not broken. Thus, it is time for
Congress to consider enacting express authority for a no-fault
injunctive regime that will give rightsholders what more than a
decade of experience around the globe has shown is one of the
most effective tools to address piracy.
Thank you for your time and attention to this important
issue. I am happy to answer your questions.
[The prepared statement of Ms. Temple follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Issa. Thank you. I am going to forego my initial round
of questions and first go to the gentlelady from Florida, Ms.
Lee.
Ms. Lee. Thank you, Mr. Chair. Thank you to all our
witnesses for being here today and sharing with us your
insights and your expertise.
Mr. Gladstein, I would like to begin with you. During your
testimony, you described one remedy that you propose, which is
site blocking. That is directing ISPs to block local access to
websites that are dedicated to privacy. You also mentioned that
you personally have a strong commitment to the First Amendment
and protecting free speech. If you would please, elaborate for
us on your perspective that site blocking does not infringe on
First Amendment rights to speech and expression.
Mr. Gladstein. Thank you for your question. You just were
shown a website that is dedicated virtually entirely to
distributing illegal programming that they don't own the rights
to be disseminate. Blocking that site from doing what they are
doing, the concept that this would be an infringement on free
speech is I think a specious argument.
If someone were to go and take a bunch of Ford F-150s and
steal them and create a lot and judicial process went in and
showed that. You looked at the VIN numbers, and you saw that
they didn't have the right to sell. So, the person that set up
this shop to sell these cars didn't have the right to do it.
You went through a judicial review. You wanted to stop that
store from selling illegal merchandise. The concept of saying
that free speech would be infringed by blocking their
advertising to sell free merchandise I think is specious,
irrelevant, and it just makes no sense to me whatsoever.
Ms. Lee. Tell us if you would, why and the what are the
alternative remedies of the takedown? If the site is
identified, having it shut down, why is that different and
inadequate instead of the all-out site blocking?
Mr. Gladstein. Well, I believe, I am not an expert at this,
and Karyn would be better probably to answer, but the laws in
which what we are able to do with companies that U.S. companies
versus companies that are international companies is different.
I think Karyn--
Ms. Lee. We will give that to Ms. Temple. If you would,
share with us a little bit more about your concepts of
remedies, no-fault injunctive relief, and the distinction
there.
Ms. Temple. Yes, as he mentioned, the issue that we have
been focusing on with respect to no-fault injunctive relief are
those websites that are dedicated exclusively to infringement.
They are not UGC sites. If we send them a takedown notice, they
are not going to take it down because that is their primary and
sole purpose. They are also often located overseas. So, the
DMCA doesn't even apply necessarily to them.
So, the only way that we can go after those types of sites
is through a lot of civil enforcement, a lot of trying to get
law enforcement overseas to actually go after the sites. If we
are not able to get law enforcement overseas and we aren't able
to find the website operators wherever they may be, then site
blocking is the only remedy we have for the United States.
For example, FMovies is a site where the operators of the
site are actually located in Vietnam. Their servers are
actually in Bulgaria. I recently went to Vietnam and requested
and asked the Vietnamese law enforcement to go after those
website operators. Again, we also referred this to U.S. law
enforcement. So far, we have not been able to get that site
down. So, again, millions and millions of U.S. consumers are
accessing this illegal content.
Ms. Lee. Mr. McKnight, you have a unique perspective on the
takedown process, given your industry. Tell us if you would,
your perspective on why that is inadequate.
Mr. McKnight. Yes, we think that essentially the speed with
which material moments occur in live events. Focusing on UFC,
in particular, we may have a main car that features a popular
fighter like Connor McGregor. In 5-10 minutes or less,
sometimes 5-10 seconds, those moments that the fans care most
about seeing can elapse. So, if they are able to pirate a
stream for 5-10 minutes, they get what they want, essentially
taking away any incentive to pay a dime for a legitimate piece
of content.
The technology is advancing, not just the means to access
the content, but the quality. Some of these feeds, if you look
at these pirated sites, are HD quality. They are just as good,
or close to as good, as what you are getting on our site.
So, our focus is on the definition of expeditious removal.
We have evidence, empirical evidence that sites can do better.
These are oftentimes social media platforms, not specifically
folks who are dedicated to criminal conduct, but simply folks
who have an opportunity and the technology to do better taking
down these illegal streams in a way that we believe is
appropriate. They can do it. We think they have a commercial
incentive not to always put their best foot forward. We think
in the absence of clarification as to what expeditious removal
should mean, which is immediate or near immediate, then they
will continue to not put their best foot forward. That is the
issue we have in the--
Mr. Issa. Would the gentlelady yield for just a second?
Ms. Lee. Yes, Mr. Chair. I yield the balance of my time to
the Chair.
Mr. Issa. We will say balance. Just as a followup to make
sure it is in the record with your questioning, Mr. McKnight,
what is the fastest that you have seen takedown occur, just so
that we understand how fast it has been and can be?
Mr. McKnight. Yes, we have seen it happen in several
minutes. That is about the fastest we see it happen. It has
taken sometimes hours, sometimes days. It is really these
fluctuations that give us the proof that the best foot forward
is not always being put forward.
We have been told by a particular platform that at one
point we were elevated to kind of most favored Nation status.
We saw a dramatic improvement for a few weeks. Then things kind
of went back to what they were, status quo.
Mr. Issa. I thank the gentlelady for yielding. With that, I
recognize the Ranking Member for his questions.
Mr. Johnson of Georgia. Thank you, Mr. Chair.
Mr. Gladstein, what does copyright enforcement in the
United States look like for individuals or small group creators
who do not have access to resources like the UFC's or the MPA's
Alliance for Creativity and Entertainment?
Mr. Gladstein. We have various guilds and unions that
assist filmmakers of all types. So, they are helpful. We rely
on the distributors, who are often the financiers, of our films
to make the decisions about where our films go. As a producer
of Pulp Fiction, I am not, I don't get to weigh in on where my
film is distributed. I can have an opinion, but it is often not
listened to.
I think the important thing to cite is that as a creator,
the more people that see that very product that I have created
thrills me. So, there are, I think, 140 legal streaming sites.
So, it isn't a problem if there is not enough places to find
the films in legitimate areas. Studios such as Warner Bros.,
Disney, and smaller art house distributors are trying to find
the most vast audience that they can find in every corner of
the world.
We rely on those studios or distributors to issue these
kind of takedown notices, et cetera. As a filmmaker, it is not
something that I participate in. I would rather create my next
movie while someone else is fighting the battle of swiping
money from us somewhere else.
Mr. Johnson of Georgia. Thank you.
Ms. Temple, one of the many developments in recent years
has been the trend from illegal downloads to illegal streaming.
Can you explain what the implications of this shift are?
Ms. Temple. Yes, thank you for the question. To add on to
what the other witness said as well, in terms of notice and
takedown and individuals not being able to really protect their
rights, I will say that it is very difficult. We spend hundreds
and millions of dollars to develop notice and takedown systems
to send millions of notices to various UGC sites. Individual
artists and creators often don't have the ability, and
resources to do that. So, it is a very difficult situation for
individual creators. That is something that has often been
discussed with respect to the DMCA.
I will say that with respect to how piracy works now, we
are seeing online piracy that is streaming piracy now be the
vast majority of the type of piracy that is out there. That is
more than 90 percent of the piracy that is out there is
streaming piracy. The difficulty, of course, as I mentioned
earlier, is that it starts outside of our jurisdiction. So, the
operators are not in the United States. We are able to go after
them when they are here.
The operators might be in one country. The servers where
the infringing content is hosted might be in yet another
country. The registrar or registry might be another country's
registry that is actually like from Tonga. So, it is extremely
complicated and difficult for us to actively go after these
dedicated infringing sites because of the global nature of
piracy.
Mr. Johnson of Georgia. Thank you.
Mr. McKnight, can you explain why this is especially
significant for live events like those put on by the UFC?
Mr. McKnight. Yes, as mentioned previously, we think that
the short timeframe with which material moments can take place
in the context of live events makes it ultimately important
that platforms are putting their best foot forward in taking
down this illicit content as soon as possible.
This proverbial case of justice delayed is justice denied.
So, oftentimes, if we're getting take-downs in 10-15 minutes,
and hour, or certainly days, it's too late. The folks viewing
the pirated streams have already seen these material moments
and they've already made the decision that if those are
available, they're not going to pay for legitimate content.
Mr. Johnson of Georgia. Thank you. The Protect Lawful
Streaming Act was enacted nearly three years ago to close
certain gaps that made enforcement of infringement challenging
when it was conducted by digital streaming. What effect has the
Protect Lawful Streaming Act had on internet piracy so far, Mr.
McKnight?
Mr. McKnight. So, I think that the passage is certainly
helpful. We worked long to get that passed. We would like to
see it enforced because I think that the end of the day the
true deterrent to folks who are professional pirates that we've
been--some of which we've been speaking about today, is when
they actually see these laws enforced. So, I think it's a huge
step in the right direction and we'd love to see greater
enforcement so that a true deterrent effect can take place in
the market.
Mr. Johnson of Georgia. Thank you, and I yield back.
Mr. Issa. I thank the gentleman.
We now go to the gentleman from Mr. Wisconsin, Mr.
Fitzgerald.
Mr. Fitzgerald. Thank you, Chair.
Ms. Temple, how does piracy affect the type of films that
might be financed or produced? Any opinion on that?
Ms. Temple. Yes, that's a great question. Unfortunately,
piracy does affect the variety of films that might be produced
because you--it costs so much money to be able to produce a
film that you want to make sure that the film will actually be
able to get back its revenue. If a film is pirated, if it's an
indie film or a niche film, then the revenue that is going to
be affected by piracy will even be lower.
So, unfortunately, that means that you often might see a
few more of those blockbusters and those sequels and series
types of films because those you know are going to have a large
amount of revenue versus being able to have a wider variety of
types of films. It really does impact minority filmmakers and
independent filmmakers because they are not able as much as
some of the larger studios to prevent the piracy that is going
on.
Mr. Fitzgerald. Yes, so the studios are more or less likely
to take a risk on a film knowing that the prevalence of that
piracy might be related to the content. Does that sound
accurate?
Ms. Temple. Yes, exactly.
Mr. Fitzgerald. OK. Very good.
Mr. McKnight, the area that you have been discussing is
fascinating to me, to many other people, because of the live
stream angle. What financial impact does copyright privacy--do
you have any idea what impact it has on the live sports
industry per se? Ballpark or any type of estimate on that?
Mr. McKnight. So, we've done studies. You can't do it with
exactitude, obviously, because you can't say every single
person who looks at a pirate stream is going to convert to a
paying consumer.
Mr. Fitzgerald. Right.
Mr. McKnight. Even if you take very conservative numbers,
one out of five, you get into tens to hundreds of millions of
dollars in losses. As Ranking Member Johnson correctly pointed
out, the real problem here is a lot of people view this as
victimless crimes, but the lack of these resources aren't just
affecting an inanimate entity, or the wealthy members of that
entity. There are also people downstream. They're the athletes,
they're people who work the cameras, people who work in just
very basic jobs like in the production crew, driving trucks,
and doing things of that nature, all whom are impacted by this
loss in revenue.
Mr. Fitzgerald. The other thing I would say is as someone
who--you brought up Connor McGregor, and I have seen a few of
his fights. Oftentimes, that results in somebody organizing a
party or bringing a group of people together to watch that. So,
have you looked at the consumer end of it? Are people aware
oftentimes that they may be not on an official site, but on a
pirated site? What do people--how do they gauge where they are
going to seek their entertainment or a live stream of a
sporting event?
Mr. McKnight. So, I think people are aware. I think the
real issue is, like I said, they view it as somewhat of a
victimless crime. If you go on a social media platform, for
example, and someone uploads a UFC fight, you go and you click
on the link, you don't view yourself as doing anything
inappropriate. What you think you're doing is getting free
access to an event you enjoy, and that the wealthy UFC won't
miss the money they could be obtaining as a result of a
legitimate purchase.
When you multiply that thought process by hundreds of
millions of times, obviously the dollars get significant and
then you have that cascading effect on everyone involved up and
down the stream of producing that event that I had mentioned
before.
So, I do think they know. They certainly know in the case
of folks who are going to the professional pirates and paying
cut rates that are advertising sometimes on the social media
platforms essentially saying don't buy the event from the UFC;
come here and get it for free. They're doing it in ways that I
think it's readily easily to identify that you're not doing
something proper.
Mr. Fitzgerald. In a lot of commercial settings, whether it
be a bar or a restaurant or someplace where they are actually
using it to bring people to their restaurant or their place of
business--have you guys looked at that angle of it? Is this
something that is happening and is it a violation?
Mr. McKnight. So, we do look at that. We do have commercial
licensing agreements with many of these establishments--
Mr. Fitzgerald. OK.
Mr. McKnight. --that are showing it at bars and things of
that nature. We have ways to police it when people are showing
it without paying that commercial fee. That aspect of it is
actually less of an issue than the individual user going to the
social media sites or folks going to these professionally
pirated sites where they are putting these sites up for the
specific reason of showing pirated content.
Mr. Fitzgerald. Very good. Thank you very much.
I yield back, Chair.
Mr. Issa. The gentleman yields back.
We now go to my friend and colleague from California, Mr.
Lieu.
Mr. Lieu. Thank you, Chair Issa and Ranking Member Johnson,
for holding this important hearing.
So, Ms. Temple, I have a question for you. You showed
FMovies, the online piracy site for movies. If you are in
Europe and you typed in that website, would you be able to
watch free movies in Europe?
Ms. Temple. No, and the vast majority would not because
again it's been blocked in 16 countries including most of the
EU. So, you would not be able to access FMovies in those places
where it has been site blocked through the legislation there.
Mr. Lieu. Thank you.
So, Mr. Schruers, I just went on my phone and went on
FMovies, and it is still up, and I can watch Willy Wonka for
free without paying for it. Why don't the online server
providers block it right now, like today?
Mr. Schruers. So, I take as described the site that we saw
here, though I do have to ask--that might have to do with
something with why Federal law enforcement hasn't taken action
against this either. There are, of course, lots of remedies
that are available today under existing Federal law.
Mr. Lieu. I think the reason is because they are based in
Vietnam. You don't have to take it as described. You can just
go on your phone right now.
Mr. Schruers. So, I think we should take a step back and
recognize that if the remedy that is sought is implemented
here, all we're doing is preventing a domain name from
resolving to an IP address, right?
Mr. Lieu. Right, I think that is important. So, I am going
to ask the members of your organization to take it down right
now.
So FMovies is so popular, there is a whole Wikipedia site
on it. I just read it. It has been in existence since 2016. It
was launched seven years ago. It says what countries have
blocked it, what countries haven't. Your members can take it
down or can block it right now. I am just asking you to do
that.
Because we are trying to be reasonable here. This is such
an unreasonable case. It is so clearly online piracy, copyright
infringement. You don't want your organization, your members to
be defending something so blatantly unlawful and unreasonable.
So, I just asked your members to block that site today.
Mr. Schruers. So, the broadband providers that actually
provide the resolution of these domain names are not at this
table, right?
Mr. Lieu. Get them to block the site today. People should
block the site today because you cannot defend this. It is just
not defensible, and the Members of Congress here are watching
this. This is not where you want to be. This is not where your
industry wants to be. I get the nuances. I may not even oppose
the views that you espouse today, but this particular site for
example is not defensible, and certainly not for seven years.
Mr. Schruers. I think I--
Mr. Lieu. You did say in your testimony--you talk about how
your organization and your companies work with stakeholders to
do with copyright infringement. This has been going on since
2016. It is so clearly indefensible. I am just asking you to
take it down, to block it.
Mr. Schruers. The digital services that are--content
creators among my constituent are also victims of these sites.
They, too, distribute content online and their content is also
pirated. So, this is a broadly shared interest in preventing
infringement. Obviously, the best tool for that is to make
content as widely available as possible where and when
consumers want it. Meeting consumers' needs is--
Mr. Lieu. So, that is very interesting. I know you said
that; you put it in your testimony. Do you think people
actually don't know how they can watch the movie Willy Wonka?
Do you think with internet search they won't be able to figure
out how they can stream it and pay for it?
Mr. Schruers. I think that's a great question because, at
least as we've been told, Wonka is not yet available on this
market, but it's available on other markets. So, we often see
that pirates arbitrage windowed releases to try and take
advantage of content not being available on one market. That's
why a number of audiovisual producers have gone to worldwide
releases, but--
Mr. Lieu. So, what you are saying is that all movie CDOs
immediately on releasing a movie in the movie studios need to
also release it, right, online? Then is that your solution?
Mr. Schruers. What I'm saying is the best strategy to fight
piracy, among many strategies, is ensuring that consumers can
access the content that they want to pay for. We've seen that
when lawful services are launched in countries where there is
high piracy, those rates go down because consumers by and large
want to pay for the stuff. They want to consume it lawfully.
There's obviously risk to infringing services. The vast
majority of them want to support the creators that they enjoy.
Mr. Lieu. Thank you. So, I ask the Members of your
organization that can block this to block it. If they don't
exist in your organization, I ask Chair of this Committee to
call in a hearing with a witness that does represent the
Members that could block this site and block it now.
Mr. Issa. Would the gentleman yield?
Mr. Lieu. Yes. No, no. Go ahead.
Mr. Issa. Pursuant to your request I will agree to invite,
if you will, members of the ISP community here to have a
discussion about the proposed remedies and how some or all them
might be implemented pursuant to court order. So, that will be
an invitation that the Ranking Member and I will send out
before we get to Christmas.
Mr. Lieu. Thank you, Mr. Chair. I yield back.
Mr. Issa. I thank the gentleman.
We know go to the gentleman from Oregon, Mr. Bentz.
Mr. Bentz. Thank you, Mr. Chair.
Thank all of you for being here.
Ms. Temple, I am trying to figure out if this is an issue
of technology that we can fix it, or a lack of enforcement, or
something else. So, tell me--as we listened to the exchange
just previous to my questions, I am a little bit unclear. So,
which is?
Ms. Temple. Well, as I mentioned earlier, it is a very
complicated issue. I will respond to what Mr. Schruers said
about access to legitimate content. I think that is an argument
that we were hearing 20 years ago, but quite frankly today,
there are hundreds of ways to access movies legally online
through streaming services throughout the world. So, there are
a wide variety of legitimate offerings for consumers. Piracy
still exists.
What makes piracy so complicated and difficult is that
technology does change and we do have to keep laws updated to
be able to address the changing technology. As I mentioned
before, streaming piracy has become one of the most prolific
types of piracy that we have out there.
Also, it's cross-jurisdictional again so it's difficult to
be able to attack the websites where they are. I think
Representative Lieu was right when he said that probably the
reason that the U.S. law enforcement has not gone after FMovies
is because the website operators are in Vietnam. We do
encourage law enforcement and they do work together, but it
sometimes takes time and years. We also went to Vietnam.
Personally, I went to Vietnam to ask law enforcement to take
action, but they have not done so yet.
So, if we had a solution in addition to the solutions--this
is not a panacea. We don't think that site blocking alone is
the only solution. We still engage in a lot of self-help, but
if we had that additional tool of site blocking that would
allow us to be even more effective to combat piracy today the
way it occurs.
Mr. Bentz. All right. Well, you take us directly to my
question of what we should anticipate should the ISP folk come
in. What are they going to say?
Ms. Temple. Well, it's interesting because in our
experience overseas where this has happened in 40 countries, we
actually worked collaboratively with the ISPs. So, we have had
great relationships and cooperative relationships with the ISPs
because they understand that this is a process that is not
overly burdensome to them. It's a process also that they are
engaged in.
So, my hope would be that the ISPs that you would call in
would talk to the ISPs in the 40 countries that have this type
of legislation. Then they would realize that the type of
legislation we're asking for is legislation that works, that's
effective, and that provides all the guardrails and due process
issues that have been raised in the past.
Mr. Bentz. We will see. So, let's stick with this for a
second. The tools that you suggest: Site blocking, ham-handed,
not directed. What is wrong with the device?
Ms. Temple. Yes, certainly those who are not familiar with
legislation and the way site blocking works could say that is
the case, but in our experience for the last 10 years, that is
just not true. The way that site blocking works is in all the
jurisdictions in which we operate there is a very specific
process first to assess whether the website is actually
dedicated exclusively to infringement.
Mr. Bentz. So, let me hop ahead. Does it on occasion not
get it right?
Ms. Temple. In our experience--
Mr. Bentz. Is it perfect?
Ms. Temple. Well, no law is perfect, so I can't say that--
Mr. Bentz. I am not talking about the law; I am talking
about the technology.
Ms. Temple. In our experience, as I said, we do not see
instances of over-blocking or--
Mr. Bentz. In anticipating a difference of opinion, Mr.
Schruers, maybe you can answer the question.
Mr. Schruers. Yes, so I think there are a number of
examples cited in my testimony and others that we can provide
where these architectural-level solutions have gone wrong.
Now, if we're talking about this one site that we've seen,
and this remedy that's being proposed would only be available
against that site, then that's one situation. If this remedy
would be available against any online presence that's accused
of infringement, well then would this remedy be available
against campaign advertisements that are alleged to have not
licensed their music? I mean, we have to ask against what
constituency can this be applied, first of all. Then second,
what's the potential collateral damage?
It may not be remembered, but 10 years ago due to miscali-
bration I understand of IT the digital service Spotify was
blocked in this building, right? So, mistakes happen, and we
need to ensure that the remedies are properly scoped for the
problem.
Mr. Bentz. Thank you. I yield back.
Mr. Issa. I thank the gentleman.
We now go to the gentlelady from North Carolina, Ms. Ross.
Ms. Ross. Thank you, Mr. Chair and Ranking Member. Thanks
to all the witnesses for joining us today.
When artists and creators pour their energy into developing
a product or a creative work, whether it is a song, a movie, a
book, an article, a piece of visual art, or anything else, they
deserve the opportunity to profit from their work. Digital
privacy is theft of that opportunity. It deprives not only the
copyright holders, but the individual artists and technicians
who have contributed to a product to earn their livelihood and
be able to profit from their creativity and their work. This is
embodied in our Constitution.
Ms. Temple, I know you have gotten a lot of questions about
how site blocking works. Which countries have been most
effective in executing site blocks while also respecting due
process?
Ms. Temple. Thank you for the question. I think in our
experience the United Kingdom has been very effective in
implementing site blocks, but also recognizing and protecting
individual freedoms. Australia is another jurisdiction that has
extensive experience in this and has been very effective. They
recently in 2018 did a full review of their legislation to see
if it had any negative impacts and continued on with the
legislation because it did not. So, those are two jurisdictions
that we find to be very, very effective.
Ms. Ross. Just to pick up in Australia, because you cited
evidence from studies in Australia that when there were no-
fault injunctions that would encourage a shift to legal
channels. Can you tell us more about these findings and how no-
fault injunctions affect users' behavior and choices?
Ms. Temple. Yes, thank you. We've done a lot of studying
over the last 10 years in which we've been operating in
countries that have no-fault injunctive relief regimes, and our
statistics and research shows that not only does traffic to the
websites, that are actually illegal websites--not only has that
plummeted, but consumers then go to legal websites. So, we see
an increase of between 5-12 percent to legal websites after we
block in a certain jurisdiction.
Ms. Ross. That is great. That goes a little bit to Mr.
McKnight's testimony.
I want to shift a little bit. I represent the Research
Triangle area of North Carolina, a number of research
universities, and I want to highlight how digital piracy
impacts scientific journals and threatens the security of
American research. For example, Sci-Hub, an active private
website based on Russia, has amassed over 80 million scientific
journal articles often by illegally targeting university
websites in the U.S.
Mr. Schruers, are you familiar with Sci-Hub and do you know
if your members, including AI developers, have systems in place
to ensure that they do not obtain content to train AI systems
from Sci-Hub or other pirated sites?
Mr. Schruers. I'm familiar with the website, but I don't
think I have enough information to answer that question right
now. I'm happy to followup for the record.
Ms. Ross. That would be terrific.
Then for all the witnesses, and maybe we will start with
Mr. McKnight because I haven't addressed a question to you,
yet.
Have there been any international policies that have been
especially effective at preventing consumers from cyber fraud
that often result in engagement with piracy sites?
Mr. McKnight. I think the site blocking that we've been
talking about has been demonstrated to be effective in certain
countries, at least against professional pirates. I'm certainly
not an expert in this area. We're focusing more on expeditious
removal and enforcement here in the U.S. So, that's how I would
answer from our perspective.
Ms. Ross. Mr. Gladstein, do you have anything to add? Then
we can come to the other two.
Mr. Gladstein. No.
Ms. Ross. OK. Mr. Schruers?
Mr. Schruers. I don't know if I have any more to add to
that. Thank you.
Ms. Ross. Ms. Temple?
Ms. Temple. Yes, I would just add that again we've noticed
that site blocking has been effective and in our analysis of
those harms that come to consumers that go to those sites
you're for example four times more likely to be the victim of
credit card fraud, four times more likely to be the victim of
malware, I think 30 times more likely to have viruses on your
computers. So, site blocking does help protect consumers.
We were actually very pleased that we were able to work
with the Department of Homeland Security and the IPR Center a
few months ago to issue a PSA that talked about the harms to
consumers from online pirated websites. So, site blocking would
be able to help that as well.
Ms. Ross. Thank you very much.
Mr. Chair, I yield back.
Mr. Issa. I thank the gentlelady. The gentlelady yields
back.
We now go to the gentleman from California, Mr. Kiley.
Mr. Kiley. Thank you, Mr. Chair.
Mr. McKnight, I appreciated your testimony and certainly
understand the harm that is done that is sort of unique when we
are talking about live sports, that there is a real value
proposition to actual live consumption. So, a remedy that is
delayed even by an hour or so is insufficient.
So, we have talked about various potential remedies, maybe
redefining expeditiously to mean instantaneously or near
instantaneously. Could you help me understand kind of how the
mechanics of this work? Like if there is a fight going on how
do you sort of in the moment find the illegal streams and then
alert the ISPs?
Mr. McKnight. Sure. There's a number of ways. Some of the
ISPs have automatic--to the extent you can identify and
digital--the technology, depending on how good the stream is
and the quality of it, can identify it and pull it down.
Where we have the issues is where we then have to identify
and then submit these take-down requests. Then it's a question
of how fast they take action after that, after those requests
are submitted. We're seeing very, very uneven performance. In
some areas there's just nonresponsiveness and that's when
you're seeing things like hours to days.
Then with other sites we've worked with we've--social media
platforms that we've worked with we've seen it happen 7-9
minutes. It's not terrible, but it's not effective. Most
importantly we know it's not the best they can do because it's
been better.
Mr. Kiley. Right.
Mr. McKnight. We've had conversations and seen things
improve, but only momentarily, only to go back to sort of like
the problematic practices that we observed a long time.
Mr. Kiley. So, you said that the ISPs--that if the quality
of the stream is good enough, they can find it. How do they do
that?
Mr. McKnight. They have technology. Like say if someone
holds their phone up to a screen.
Mr. Kiley. Yes.
Mr. McKnight. Depending on the quality of which that stream
is put forth on a social media platform, for example, there is
technology that can identify it as a problematic stream and
automatically take it down off of a social media platform or--
Mr. Kiley. OK. So, it is automatic? In other words, the
technology identifies this as a copy essentially?
Mr. McKnight. Correct.
Mr. Kiley. There is no need for notice and take down, and
for a person to approve it? It just comes down?
Mr. McKnight. Correct, in those instances where that can be
identified.
Mr. Kiley. So, is there a way to incorporate that
technology even on the provider side where you could sort of
include it in--
Mr. McKnight. Giving us access. Yes. One particular
provider has offered to do that, but many others haven't. Yes,
there are technological potential to develop that type of
technology. Some folks have it already. They're just not
putting their best foot forward.
Mr. Kiley. Yes.
Mr. McKnight. Look, without making accusations, the natural
commercial incentive, if you're running one of these sites, is
the more users you have viewing content over your site the
better it is for you commercially.
Mr. Kiley. Right.
Mr. McKnight. Right? So, you don't necessarily have the
incentive to put your best foot forward here. If you look at
the law the way it's currently constructed, it's not clear that
we have a case that hours isn't expeditiously or that even a
day isn't expeditiously. The point we're making is if you're
dealing with a live event as opposed to something like a movie;
and there are other issues there that have been explained well
by my co-panelists, that isn't expeditiously. It's
definitionally not expeditiously to not take it down after it's
already over.
Mr. Kiley. Right.
Mr. McKnight. In effect the commercial value is gone.
Mr. Kiley. Is there any way to--I think there is a way with
the technology where it can just be scrambled, or whatever, so
you don't have to have an active taking it down per se. It is
just that there is no--it doesn't actually--I don't know, Mr.
Schruers, do you want to weigh in on that as well? Maybe you
have some technical expertise. I am just trying to understand
the nature of what is available technologically so that can
inform the best solution from a policy perspective.
Mr. Schruers. Filtering technology is sadly not magic.
There's no metadata that says this is an infringing stream,
although perhaps humans can determine from certain contextual
clues whether or not something is authorized, although we can
get that wrong, too.
Mr. Kiley. How can you not make that--if you have one
authorized transmission wouldn't any retransmission of that
sort of definition unauthorized? So, that could be identified?
Mr. Schruers. So, there's a crucial piece of data there,
which is what is the authorized transmission? A number of
leading services do allow and invite live sporting events to
pre-identify what content is lawful. They may furnish hashes
that allow for real-time filtering, but that does require data
and interindustry collaboration to ensure that the digital
services have the tools to prevent the content from being
ingested into their system. Of course, that all assumes that
this isn't just a hyperlink to some site elsewhere.
Mr. Kiley. Right. Yes. Did you have anything else you
wanted to add? I am sorry, Mr. McKnight.
Mr. McKnight. Well, I would just say in our case we only
have one legitimate authorized partner in the U.S., which is
ESPN+. So, if our live events are being shown anywhere else,
it's definitionally unauthorized.
Mr. Kiley. Right. Right. OK. Thank you very much.
Mr. Issa. I thank the gentleman.
Continuing with our California run, the gentlelady from San
Jose, Ms. Lofgren.
Ms. Lofgren. Well, thank you very much, Mr. Chair, and
thanks to each one of these witnesses for their excellent
testimony.
Mr. Gladstein, no one is going to defend that infringing
site, including me. To me the only question is how do we
prevent this piracy? None of us should be defending it, and I
include myself very much in that category.
It was just 12 years ago that we had a very tumultuous
markup in this room. I think just Mr. Issa, Mr. Johnson, and I
were here. At the time technical experts: The Internet Society,
ICANN, and others, strongly advised against DNS-level filtering
or blocking and instead urged that content-level decisions be
made at the network edge and not at the internet's
infrastructure core. I think that probably continues to this
day. So, the question is what are the best remedies? I think
that is something I would love to focus on, Mr. Chair.
One of the things that I am interested in is when we have
done a number of laws to help on this, I would like to know how
they are being administered by those charged with enforcement.
For example, the Copyright Claims Board has the ability to take
action as part of the CASE Act, which I supported. I don't know
how that is going. I would like to know that. Obviously, that
is not the major studios.
Federal prosecution under the Protecting Lawful Streaming
Act of 2020. What has been done on that? Has the DOJ brought
any cases? I would like to know about that.
The National Intellectual Property Rights Coordination
Center led by Homeland Security is supposed to help with the
Protecting Lawful Streaming Act. They have a center there. How
is that working? I would like to know that as well.
One of the concerns, I think that we are missing the boat,
frankly, and I thought so 12 years ago when we had this
tumultuous markup. These piracy sites would not exist if they
weren't lucrative. They are making money and that is why they
exist.
There are problems in terms of the effectiveness of trying
to block IP addresses. There are technical issues that the
internet engineers brought to a head 12 years ago, but there is
no technical problem in preventing the funding. If the credit
card companies are going to be told they cannot process the
funds for a variety of sites, these sites will go away.
Now, there is a problem internationally, but the OPEN Act
that I supported would have made the copyright trademark
infringements and unfair trade practice and would have brought
in the U.S. International Trade Commission as a partner in
this. I think even though sometimes we are not happy with their
level of concern, and sometimes they go in the wrong direction,
it is a hook actually in terms of going abroad with the
financial services component of this. To me the answer has
always been to cutoff the money and this will go away.
So, I am interested--Mr. Schruers, you are the only one
here with--speaking from technology, and I know the Chair has
said we are going to have other hearings on technology, but
part of--YouTube for example has gotten the digital file for
various content, so that they can take action when there is an
infringement.
One question I have, and it has been problematic, because
you can make minor changes to that digital file and evade it--
have we explored or is it even possible to do that kind of
digital file on a broader basis and would it work given the
alteration that could be made?
Then if anybody has a comment about cutting off the money,
which I think is probably going to be the most lucrative, the
most effective method we can--I would be very interested.
Mr. Schruers. Thank you for the question, Congresswoman. I
think that's a great point. There are among leading services
and leading content providers evolving strategies to share what
we call hashes, which are sort of like digital fingerprints of
a piece of content. Digital services will filter for that hash.
That's used both in the copyright context and outside of it,
and it's a very effective way to intercept at the point of
ingestion content that should not be in a particular place or
should not be available for any number of reasons.
Obviously, technology is expensive. It has to be
implemented in each service in a different fashion, but it is a
very effective way to solve these problems at the front end. It
requires a lot of intersectoral cooperation.
Ms. Lofgren. I see my time is expired, but I would invite
the witnesses--
Mr. Issa. I would ask unanimous consent that the gentlelady
have one additional minute. Without objection, so ordered.
Ms. Lofgren. Thank you. I would just invite each of the
witnesses to comment, even after this hearing, on the concept
of denying access to financial rewards through the financial
system, the credit card companies and the like, on how we might
work together to explore that. I know that we have got just a
few minutes here and it is a deep subject.
Mr. Gladstein. May I make a quick comment?
Ms. Lofgren. I would love to make this impossible to profit
from.
Mr. Gladstein. May I make a quick comment?
Ms. Lofgren. Sure.
Mr. Gladstein. One of the issues with following the money
that might not service this issue as well as you've just
stated, quite frankly, is that many of these sites don't charge
the consumer anything to be able to watch that film. So, what
Netflix or Apple or anyone is competing with is the free
dispersal of the product. The way in which those sites are
making money is from advertising and from selling malware that
they get from those that go onto their sites. For credit
cards--
Ms. Lofgren. Right. So, we would have to go after the
advertisers as well?
Mr. Gladstein. So, the consumer isn't using their credit
card. They're just hitting a button. The technology is such
that the programming that they're watching doesn't look like
someone sat in the back of a theater with their iPhone and
copied the movie. It is a digital copy of the film that looks
exactly like the film I just made. I couldn't tell the
difference between the version that's on FMovies and the
version that's on Netflix.
So, following--and also bitcoin is used often now.
Ms. Lofgren. Right.
Mr. Gladstein. There are various other ways in which these
folks doing this illegal activity is doing other illegal
activity and benefiting from those that are going on to their
sites. So, merely the credit card is not a solution, I don't
think.
Ms. Lofgren. Not all of it.
Mr. Chair, I appreciate your giving me an additional
minute. I will just close with this: I hope we don't get into
another tumultuous dysfunctional technical fight as we did 12
years ago, but I do think we have a lot of opportunity to look
at enforcement including DOJ, including potential financial
cutting off. I think the gentleman's testimony is enlightening
and we could spend a lot more time getting into this and maybe
getting some real results. So, I yield back, and I thank--
Mr. Issa. I thank the gentlelady. Those 12 years ago the
names SOPA and PIPA were bantered around, and we thought that
this was going to be a solution without any debate. I can
promise the gentlelady that we are going to invite all the
parties, we are going to go through a process that at least
makes sure that all facts and capabilities are known before any
legislation goes forward.
I have a history with several here on the dais of fighting
against our own Chair at the time and Ranking Member and
against the Senate. We won, but unfortunately the content
producers do not have a solution. So, I want to find justice at
a fair rate, something that you and I fought against more than
a decade ago, but we know we still need to protect the content
producers. So, I look forward to working with it and I promise
an open and transparent process.
Ms. Lofgren. Very good.
Mr. Issa. I know thank the gentleman from Virginia for his
patience and yield to him.
Mr. Cline. Let me tell you, Mr. Chair, thank you for the
time. I want to thank the gentlelady from California, because I
wasn't here 12 years ago, but I was here 20, 25 years ago, but
I was sitting back there and watching the DMCA debate and
watching the telecom activate. So, this is fascinating for me,
and I appreciate the gentlelady's expertise and all her work.
Ms. Lofgren. If the gentleman will yield, I think--
Mr. Cline. I am happy to.
Ms. Lofgren. --the Chair, former Chair, and I may be the
only Members of this Subcommittee who were here when the DMCA
was approved, and obviously the technology has changed since
that time. So, I appreciate your--
Mr. Cline. It has. I would want to start by agreeing with
the gentlelady in her comments about DOJ. In 2020 only four
criminal copyright cases were charged. In 2021 only five were
charged. Only three were charged in 2022. So, we have a ways to
go.
I would like to have DOJ here and have the opportunity to
get into a discussion with them about this issue, because there
are so many different issues with DOJ that we have to discuss
that it is a challenge to cover everything you need to. With
this topic I think having a specific hearing regarding the lack
of prosecution would be helpful.
I also want to address your comments about the technologies
12 years ago. The changes in technology might not be all that
significant, but when you are talking about the internet, I
mean 12 years is a lifetime. I would guess that there have been
changes in technology that may make site blocking more
feasible, more effective, maybe more targeted.
Ms. Temple, can you comment on any of the technological
developments in that area?
Ms. Temple. Yes, I think the main thing that we have
learned over the last 10 years of working with these laws with
ISPs is to work again collaboratively with them and provide
them flexibility in terms of the use of technology. I know that
there's been a lot of talk about DNS-level blocking, but that's
not the only type of blocking, and that's not even the primary
type of blocking that we're talking about.
So, when we ask for site blocking orders overseas, we work
with the ISPs. They have flexibility in the law in terms of
utilizing the most effective and most efficient and least
burdensome type of technology, whether that is DNS blocking,
IPS address blocking, or URL blocking. So, that is one of the
things that we've found to be--one of the most effective ways
to accomplish it is to work collaboratively with the ISPs and
allow them the flexibility to determine how they will actually
implement blocks that don't negatively affect networks.
Mr. Cline. Mr. Schruers, I will give you the opportunity to
respond there and talk about the technologies that are used.
Mr. Schruers. So, it's critical to think about the--I'd say
the first question you have to ask is: At what level of
abstraction are we solving this problem? I'd say throughout the
digital sector there's an interest, a desire, an urgency about
responding to piracy because in many cases these sites are
dangerous. Of course, there's a lot of content interest within
the digital sector. So, everybody agrees this is a problem.
Mr. Cline. I want to go specifically to the technology,
though.
Mr. Schruers. Right. So, as to the technology, if we're
talking about broadband providers at the architectural level--
and I should make clear those--not principally my constituents
and I don't want to speak for them--I am aware of and my
testimony cites a number of problems with that.
For digital services that are at the edge of the network
they, of course, comply with the Digital Millennium Copyright
Act notice and take down, and maybe go above and beyond that
and do allow even live events to pre-identify URL-level
filtering to ensure that URLs don't resolve.
Mr. Cline. How many take-down notices do CCIA members who
operate content platforms receive in a given year?
Mr. Schruers. I don't have that at my fingertips, but the
number is in the millions, if not the billions.
Mr. Cline. OK. How much money is spent processing these
take-down notices?
Mr. Schruers. Again, I don't know that companies break that
out, but they spend extraordinary amounts not only on the
processing by their trust teams, but on the development of
technologies that go well beyond what they're required to do by
law. Tens of millions of dollars are being invested every year
for some companies in their systems that don't just block
content, but actually allow rights holders to monetize
infringing uses of the works.
So, in many cases they're given the option to say, hey, I
can leave this content up and get a share of the revenue if I
so choose, or of course have it removed. Increasingly rights
holders choose to do that and get a cut of the ad revenue,
which is a win/win.
Mr. Cline. Mr. Chair, my time is expired. I would just like
to note that this hearing is focused on audiovisual, but
copyright piracy impacts several industries, from movies,
music, books, and publishing. I would like unanimous consent to
submit a comment for the record from the American Association
of Publishers regarding the online--
Mr. Issa. Without objection, so ordered.
Mr. Cline. Thank you, Mr. Chair.
Mr. Issa. If the gentleman would yield, I would share with
you that I was not here in 1998, but I was Chair of the
Consumer Electronics Association.
Mr. Cline. OK. Yes.
Mr. Issa. So, we were paying close attention and working
closely, of not collaboratively, with the MPAA.
Mr. Cline. Mr. Chair, I do see a lot of familiar faces who
might have been on this side of the dais, whether staff or
otherwise, out in the audience and they may be a little grayer
and a little more wrinkled, but they are recognizable today.
Mr. Issa. Just as interested. I thank the gentleman.
We now go to the Ranking Member of the Full Committee, Mr.
Nadler.
Mr. Nadler. Thank you, Mr. Chair, for holding this
important hearing. Mr. Chair, not only do the creative arts
serve to entertain and educate us, but they also support
industries that contribute billions of dollars to the economy
every year. Those industries exist because of the audiences
that buy their final product. We as consumers want the
inspiration, emotion, and diversion evoked by artistic
expression. In exchange we are expected to pay a fair market
rate for those products no matter the format in which we
consume them.
Intellectual property laws including copyright laws exist
to foster creativity and innovation. They are a promise that
with hard work and a lot of luck you can monetize your
imagination. No technological changes have challenged that
promise like the advent of the internet. Even as technology
helped us discover art beyond our small corners of the world it
made those creations easier to steal and thus less lucrative to
produce.
Copyright law is nothing without the ability to enforce
those ownership rights. It was with this reality in mind that
in 1998 when the internet was still in its infancy Congress
passed the Digital Millennium Copyright Act, or DMCA, to
protect copyrighted works online. Even with that landmark law
in place copyright piracy is still an issue that threatens
industry stability and artists' livelihoods, and the problem is
growing larger each year.
I appreciate the opportunity to examine the issue of
piracy, but as we consider any potential solutions, we should
make sure we are looking at the problem not as it existed 25
years ago, but as it exists today. Copyright piracy now
encompasses broad cybersecurity concerns, artificial
intelligence considerations, and distribution changes like
streaming services. Any action we contemplate must be flexible
enough to stand not just the test of time, but also changes in
technology that we cannot possibly imagine.
Artists and content creators deserve to have their works
and industries protected from illegal online piracy and I am
grateful to Chair Issa and Ranking Member Johnson for giving
this issue the attention it deserves. With that in mind I have
a few questions for our excellent panel of witnesses.
Ms. Temple, could you please help clarify the differences
between IP address blocking, DNS blocking, and dynamic site
blocking? When and how are each of these remedies useful?
Ms. Temple. Yes, thank you for the question. As I mentioned
earlier, in most of the jurisdictions in which we operate the
site blocking order that is issued is flexible, so the ISP is
just ordered to block access to the site. The actual way in
which that is done is up to the ISP. They might use DNS
blocking. They could use IP address blocking or URL blocking.
In most cases it's usually either DNS or IP address blocking.
With respect to DNS blocking it's typically--imagine I
guess sending an envelope through the mail and you have an
address that you're looking for. The ISP, the access ISP is
going to need to look for the address of pirate.com, for
example, because they don't know the specific IP address. They
have to go to a DNS resolver and get the actual physical IP
address, the 12312.34.5 address for the website. So, in DNS
blocking the access ISP knows that they should not be going to
look up the IP address for that site. Instead, usually they
just disregard the request to go look up that site. So, they
can't get the address to that website.
IP address blocking is similar, but it's looking at the IP
address. So, as opposed to the pirate.com issue it might--if
you know the actual IP address, the ISP will not actually allow
access to the specific IP address that the website has.
Then URL blocking is a little bit more complicated, but
that is really they inspect the packet that's going over the
internet and ensure that the very, very specific URL is not
able to be returned back to the customer.
Mr. Nadler. Thank you.
Mr. McKnight, one of the primary challenges of enforcing
anti-piracy laws is that the source of most pirated content is
overseas. Could you please explain why this is significant and
what policies if any can improve identification and enforcement
of overseas actors?
Mr. McKnight. So, a lot of our enforcement efforts are
actually based here domestically because even though it is
certainly true, as has been explained by my co-panelists, that
a lot of the problem does start and originate overseas, a lot
of the social media platforms in things like Facebook, Twitch,
the usual suspects that we're seeing our content pirated over,
actually here is domestically in the U.S. So, when we're
looking for the definition of expeditious removal to be
clarified, it's primarily to address that issue.
The closing of the streaming loophole, which was something
that we got--you all helped us get passed in 2020, has been
tremendously effective. I think with respect to that it's all
about enforcement, domestic or overseas is getting enforcement
against these career pirates. Because unless they see folks
actually going to jail or being shut down as a result of this
legislation that's powerful and has been enacted, they don't
necessarily have a full incentive not to engage in the conduct.
They pay attention to laws being passed. It's meaningful. It's
helpful. What's really helpful is when they see folks being
caught and they see them suffering consequences.
Mr. Nadler. Thank you. My last question is to Mr. Schruers.
Mr. Schruers, sites hosting pirated content often endanger
consumers through malware, cyber schemes, and insecure
connections. If in your view site blocking regimes go too far,
how do you suggest we keep consumers safe?
Mr. Schruers. So, thank you for the question. Obviously, as
I said, the best defense is a good offense and making content
widely available on as many platforms and in many contexts
possible is one of the first things that we need to do.
Once we've moved beyond that we need to look at
interindustry collaboration to ensure that digital services
have the granular data and metadata about content to
meaningfully pre-identify, for example, in the context of live
streams that something would be infringing, to filter on
ingest, and obviously strike arrangements such as those that I
described earlier where in some cases rights holders can choose
to monetize instead of simply prevent. So, there's a lot of
options available.
Then of course we have the existing panoply of remedies
that are available under existing copyright law. Statutory
damages, actual damages, all the extrajudicial relief that's
available under Section 512, to say nothing of technological
protection measures and small claims. There are probably more
remedies in the Copyright Act than many of our other IT laws.
So, we have a lot of robust tools at our disposal. There
are many arrows in the quiver that we can use. To be clear,
we're only raising concern about one specific arrow and one
specific context when we raise concerns about DNS-level site
blocking.
Mr. Nadler. Thank you. Mr. Chair, I thank you for your
indulgence and I yield back.
Mr. Issa. You have always granted me similar indulgences. I
thank the former Chair and Ranking Member.
Now for me. Mr. Schruers, I found it interesting that one
of the things we haven't gotten too much into is Mr. McKnight's
question. From your knowledge, technical knowledge, forgetting
about how something is blocked, when Mr. McKnight puts in a
notice and take-down, is there any reason that it should not be
able to be done in single-digit minutes as it sometimes is, or
even faster today based on technology?
Mr. Schruers. So, the ability of a given service is going
to respond to take-downs are going to vary depending on the
context, the nature of the work, the scope of the take-down.
It's not uncommon for a rights holder to submit millions of
URLs, some of which may not be accurate. Because every take-
down does terminate access to expressive content, there are
consequences for getting things wrong.
So, I know many services are instantaneous. A lot of
services that allow rights--
Mr. Issa. Wait a second. I didn't ask that question. I only
asked is there any technological reason that it can't be done
instantly?
Mr. Schruers. When access to content is terminated--if you
remove--
Mr. Issa. You are getting into the ramifications. Maybe I
will clarify my question. We I think can all agree that the
technology using AI is available for Mr. McKnight to submit for
it to be validated against metadata comparison. If he is making
that data available through the live stream, the idea that it
can be compared and identified and taken down essentially
without human interaction would seem to be unequivocal. So, it
sounds like there may be administrative reasons that an entity
can respond to why they're not taking it down.
As the entity that created the original notice and take-
down and the entity that can update it, as Mr. McKnight is
asking us to, is there any reason we shouldn't update a
requirement that it either be taken down using that technology,
which is near-instant, or that he or his--any company receive a
response within the same period of time as to that which delays
it?
That is what I am asking. It is much more narrow than the
other subjects we are talking about because we are not talking
about do you have the capability? We are assuming the
capability exists, because it does exist for notice and take-
down. What is your response to that? Either do it or respond
near instantly?
Mr. Schruers. I think we agree that an expeditious response
is appropriate, particularly where there's economic
consequences as have been described. Of course, Section 512
already requires expeditious response. There has been some
litigation about what that means in practice.
Mr. Issa. Well, we are really good at eliminating the need
for litigation by redefining to the courts what we really
meant. It sometimes saves a court a lot of trouble.
Let me just go on with another round of questions. Ms.
Temple, you have heard a lot here and you certainly saw us say
we don't want to have SOPA and PIPA revisited. We want to have
full and complete. I want to leave free speech in another
bucket, but I want to ask you a question.
Based on the actions of these internet providers of using
their protections under 230 to regularly take down infringing
content that you often see--in other words Mr. McKnight and
others, and even Mr. Schruers has said that providers do it,
but lawyers say sua sponte. They do it without a complaint
often and they do it with reasonable protection. If they can do
it without a complaint, as they often do, by matching, is there
any reason that we shouldn't encourage them to do it more often
or substantially all the time?
Ms. Temple. Yes, if you're talking about filtering and
ensuring that illegal content is not posted up on UGC sites,
that is something that certainly we want them to do more of and
we want to have more automated ways that you don't have to send
them millions and millions of notices that the other mentioned.
With respect to dedicated websites, of course it's much--
that are dedicated to infringement, are not UGC sites where
people are posting, it is much more complicated because those
websites are not going to take down the infringing content.
They're not going to filter it out because they're dedicated to
piracy.
Mr. Issa. Let me close with just a couple of questions.
Mr. Gladstein, I haven't asked you any questions, but I am
going to ask these questions in a sense on your behalf as a
producer of content that finds himself somewhat harmless--or
harmed without any ability. I might note that at one time I had
dinner at a large banquet, but we were at the end of the table.
It was Francis Ford Coppola who bemoaned how little control he
had over Godfather III, and if he had only had more control how
much better it would have been. So, it is not just the fire and
forget. Sometimes it is even when you are producing it.
Ms. Temple, because you have this unique expertise on both
sides of it, let me just ask a few simple technical questions.
To the best of your knowledge when somebody imports a tangible
product that violates IP rights, including patent, trademark,
copyright, does the U.S. Customs have the authority to stop it?
Ms. Temple. Yes, it does.
Mr. Issa. When a court or the ITC issues either an
exclusion order in the case of the ITC or injunction in the
case of Article 3, do all Federal agencies have the ability to
use their powers to stop the importation of those products?
Ms. Temple. Yes. Yes, they do.
Mr. Issa. So, today as a closing question aren't we just
talking about finding the equivalent of what for 200-plus years
our Customs and other agencies have done when there is due
process and entities such as Article 3 courts have reached a
decision? The execution of that protection is done by our
government or on behalf of our government by orders to those
who participate in bringing things into the United States?
Ms. Temple. Yes, I would agree that's a very similar
process.
Mr. Issa. So, as we invite the Department of Justice, which
was suggested, and as we reinvite those who chose not to be
here today, those who can talk to us about--Mr. Schruers, I
appreciate your expertise, but I want to have more of those
entities in here to talk about what is technically possible,
not just what is technically difficult. Because it is this
Committee's jurisdiction and this Committee's decision that we
protect through our ports of entry when a DVD comes in bootleg,
we must be able to protect on the internet. If we do not have
that ability today, it is our responsibility to create that
ability.
I want to close by just making one statement: I know there
have been good-faith negotiations that have gone on behind the
scenes. I have been told that those negotiations broke down to
a certain extent because of hold harmless questions in our very
litigious society. It is also the jurisdiction of this
Committee, at the Full Committee level, to provide that type of
protection.
So, let's be clear that in getting it I am aware that if
you get a court order and Customs seizes DVDs coming into the
country, everybody is held harmless. There isn't, in fact, a
government right to do so, and all you can do is maybe get your
DVDs back later if there was a mistake. You don't get to
litigate against the person that brought the claim in court.
What is possible in the tangible world; I want to put on
notice those that we are going to have in followup, we want to
find a solution in the internet world. We will not quit under
this Committee, including my Ranking Member to my left and my
Full Committee Ranking Member also to my left, until we do so.
With that I want to thank your witnesses and I want to
thank all those in attendance who often represent people who
did not speak here today. With that we stand--oh, I am sorry.
All Members will have five days to issue questions.
I would ask the witnesses would they respond to written
questions if they receive them?
Ms. Temple. Yes.
Mr. Schruers. Yes.
Mr. Issa. Thank you. With that we stand adjourned.
[Whereupon, at 11:51 a.m., the Subcommittee was adjourned.]
All materials submitted for the record by Members of the
Subcommittee on Courts, Intellectual Property, and the Internet
can
be found at: https://docs.house.gov/Committee/Calendar/ByEvent
.aspx?EventID=116671.
[all]