[Congressional Record Volume 144, Number 91 (Friday, July 10, 1998)]
[Senate]
[Pages S7959-S7960]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRAMS:
  S. 2291. A bill to amend title 17, United States Code, to prevent the 
misappropriation of collections of information; to the Committee on the 
Judiciary.


               collections of information antipiracy act

  Mr. GRAMS. Mr. President, I rise today to introduce the ``Collections 
of Information Antipiracy Act.'' This legislation is similar to H.R. 
2652, legislation already passed unanimously by our colleagues in the 
House of Representatives on May 19 of this year that is currently 
pending before the Judiciary Committee.
  My legislation presents a much-needed Federal, legislative protection 
for databases. It is a fair and balanced bill that recognizes the need 
for database owners to receive adequate legal protection that provides 
them the incentives necessary to continue investing in database 
production.
  The bill also acknowledges that users must continue to have access to 
timely and innovative database products and services.
  America produces and uses some 65 percent of the world's databases.
  Our database industry spans an enormous range of products and 
services--from collection of information about antidotes to poisons, to 
valuable collections of business and financial data, to databases of 
medical procedures and practice guidelines used to assure reliable and 
effective patient care.
  These companies have been pioneers in offering innovative and easily 
accessible databases in any number of formats that meet consumer needs.
  The myriad of databases produced in the United States are used by the 
business community, researchers, educators, government officials, and 
citizens to gain knowledge and make decisions that affect every aspect 
of our lives.
  Yet, despite technological innovations, creating and offering 
databases in the marketplace is neither cheap nor easy.
  Not only must database owners expend substantial resources on the 
collection of data, they must also maintain and distribute these 
information products, while continually updating them and responding to 
the demands of their customers.
  Many American jobs depend on a healthy, vibrant U.S. database 
industry. These companies employ thousands of editors, researchers, and 
others. They invest millions of dollars in hardware and software to 
manage these large masses of information.
  Despite the enormous value of these databases to our economy and 
society, American database owners are under a dual threat.
  On the one hand, after a 1991 Supreme Court decision, it is 
increasingly unclear whether most databases are adequately protected 
from piracy by U.S. copyright law.
  Lower courts since 1991 have handed down several decisions that have 
diminished the number and types of databases that are protected under 
the compilation copyright provisions in the 1976 Copyright Act.
  In addition, these decisions have stated that even if databases as a 
whole may qualify for this limited copyright protection, the facts 
contained in them are freely available for the taking and re-use by 
others--including competing database producers --without authorization 
or compensation.
  Although database producers do have means other than a new Federal 
law to seek protection, none has proven adequate, as is evidenced in 
the study completed by the U.S. Copyright Office last August.
  Contract law, for example, binds only the parties to the contract and 
in any case varies from State to State and it also varies from country 
to country.
  Technological protections are beginning to appear and are slowly 
being implemented in the online world, but they offer no protection to 
databases that are produced in other formats.
  Some States have adopted doctrines of misappropriation; however, 
these legal protections are far from being uniform and offer no solace 
to database producers in States where such legal safeguards are not in 
place.
  The European Union has begun implementing a new directive protecting 
databases in their own countries, but only those produced in the 
European Union or in countries that offer comparable protections. This 
law clearly is designed to disadvantage database owners not located in 
an EU country. Great Britain, Germany, Spain, and most Scandinavian 
nations have already made changes in their own laws to implement the EU 
directive, and also a European official recently predicted that within 
a few years, as many as 35 of our trading partners in Europe and the 
Russian Federation will have similar laws in place.

  Unless the United States passes a law that is comparable to that now 
governing Europe, more and more American database owners may feel the 
need to move some or all of their operations overseas in an effort, to 
thwart potential piracy of their products and services by unscrupulous 
competitors or vendors.
  As I mentioned previously, Mr. President, American database producers 
are anxious to continue producing valuable databases for worldwide use. 
However, the technologies present in today's world that allow for easy 
copying and redistribution of information threaten a producer's ability 
to continue receiving a fair return on the tremendous investments 
required to produce quality databases.
  Coupled with the inadequacy of U.S. law to protect investment in 
databases and the threat posed by the EU directive, it is clear to me 
that Congress--and more importantly, the Senate--must act quickly if we 
are to preserve the American lead in database production and use.
  The ``Collections of Information Antipiracy Act'' offers a solution 
to the threats faced by American database owners by helping to provide 
the right to stop harmful practices that affect the marketplace for 
that database.
  This legislation uses Congress' powers under the Commerce clause of 
the Constitution to protect only those databases used in commerce.
  Protection is limited to those databases whose owners have invested 
substantial monetary or other resources in gathering, organizing, or 
maintaining a collection of information.
  It contains a definition of what constitutes a protected collection 
that is broad enough to offer effective protection to the wide range of 
products and services that would benefit from a new Federal law.
  This legislation also contains numerous and important exceptions to 
the protections granted. For example, it makes clear that databases may 
be

[[Page S7960]]

used for legitimate purposes of verification and news reporting. It 
offers special exceptions to nonprofit users, such as researchers, 
scientists, and educators. The bill also states clearly that no one is 
precluded from gathering the same facts contained on one database 
owner's product and creating another database--but again, as long as 
those facts are not stolen from the original database owner. Finally, 
the bill recognizes the importance of unfettered public access to 
Government databases by specifically denying protection to any database 
created by a governmental entity--whether Federal, State, or local--or 
any database that a Government agency seeks to have created and 
distributed under an exclusive licensing arrangement. Mr. President, 
the concepts that lie behind the Collections of Information Antipiracy 
Act, and many of its specific provisions, have been debated for more 
than 2 years now. The House-passed bill now before the Senate Judiciary 
Committee was the subject of two hearings that included witnesses from 
nearly every affected community--both producers and users of databases. 
Indeed, the bill I introduce today is a much-improved version of the 
legislation first introduced in the House, and many provisions have 
been added that strike a fair balance between the needs of database 
producers for adequate protection and the also requirements that users 
have fair access to these private-sector products and services. There 
should be no fear that database producers will exert extraordinary 
control over their products and services. But, this legislation 
contains not only a special savings clause preserving our antitrust 
laws, but it also specifies low penalties against any nonprofit user 
who may run afoul of this new law. In closing, Mr. President, I am 
convinced it is time for this body to act to protect the interests of 
database owners and users in the United States. The bill I am 
introducing today represents a reasonable and fair means of doing so, 
and I urge my colleagues to join with me in working during these few 
remaining days of the 105th Congress to consider and pass this very 
important piece of legislation.

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