[Congressional Record Volume 150, Number 87 (Tuesday, June 22, 2004)]
[Senate]
[Pages S7189-S7193]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HATCH (for himself, Mr. Leahy, Mr. Frist, Mr. Daschle, Mr. 
        Graham of South Carolina, and Mrs. Boxer):
  S. 2560. A bill to amend chapter 5 of title 17, United States Code, 
relating to inducement of copyright infringement, and for other 
purposes; to the Committee on the Judiciary.
  Mr. HATCH. Mr. President, I rise with my esteemed colleague and 
friend, Senator Leahy, ranking Democrat Member of the Senate Judiciary 
Committee, to introduce the ``Inducing Infringement of Copyrights Act 
of 2004.'' This Act will confirm that creative artists can sue 
corporations that profit by encouraging children, teenagers and others 
to commit illegal or criminal acts of copyright infringement. Senator 
Leahy and I are pleased that Majority Leader Frist and Minority Leader 
Daschle and Senators Graham and Boxer are co-sponsoring this important 
bipartisan legislation.
  It is illegal and immoral to induce or encourage children to commit 
crimes. Artists realize that adults who corrupt or exploit the 
innocence of children are the worst type of villains. In ``Oliver 
Twist'', Fagin and Bill Sikes profited by inducing children to steal. 
In the film ``Chitty-Chitty Bang-Bang'', the leering ``Child-Catcher'' 
lured children into danger with false promises of ``free lollipops.'' 
Tragically, some corporations now seem to think that they can legally 
profit by inducing children to steal--that they can legally lure 
children and others with false promises of ``free music.''
  Such beliefs seem common among distributors of so-called peer-to-peer 
filesharing (``P2P'') software. These programs are used mostly by 
children and college students--about half of their users are children. 
Users of these programs routinely violate criminal laws relating to 
copyright infringement and pornography distribution. Criminal law 
defines ``inducement'' as ``that which leads or tempts to the 
commission of crime.'' Some P2P software appears to be the definition 
of criminal inducement captured in computer code.
  Distributors of some P2P software admit this. The distributors of 
EarthStation 5 state, ``While other peer 2 peer networks like Kazaa or 
Imesh continue to deny building their programs for illegal file 
sharing, at ES5 we not only admit why we built ES5, we actually promote 
P2P, endorse file sharing, and join our users in swapping files!''
  Recently, in the Grokster case, a Federal court drew similar 
conclusions about the intent of other distributors of P2P software. It 
warned that some P2P distributors ``may have intentionally structured 
their businesses to avoid secondary liability for copyright 
infringement, while benefiting financially from the illicit draw of 
their wares.'' In other words, many P2P distributors may think that 
they can lawfully profit by inducing children to break the law and 
commit crimes.
  They are dead wrong. America punishes as criminals those who induce 
others to commit any criminal act, including copyright infringement. 
The first sentence of our Criminal Code states:

       Whoever commits an offense against the United States or 
     aids, abets, counsels, commands, induces, or procures its 
     commission, is punishable as a principal . . . .

  Indeed, it is absurd to think that our law might be otherwise. No 
civilized country could let sophisticated adults profit by tempting its 
most vulnerable citizens--its children--to break the law.
  I think we must understand how some corporations came to confuse 
child endangerment with a legal business model. Their confusion seems 
to arise from court cases misinterpreting a well-intended Supreme Court 
decision that tried to clarify two critical components of federal law: 
the law of secondary liability and the law of copyright.
  The Supreme Court states that secondary liability is ``imposed in 
virtually all areas of the law.'' Secondary liability is universal 
because its logic is compelling. It does not absolve lawbreakers of 
guilt. But it recognizes that we are all human: We are all more likely 
to break the law if encouraged or ordered to do so. Secondary liability 
thus discourages lawlessness by punishing people who manipulate others 
into doing the ``dirty work'' of breaking the law. Secondary liability 
usually targets two types of persons: 1. those who induce others to 
break the law, and 2. those who control others who break the law.
  Though secondary liability is nearly ubiquitous, it has almost always 
remained as a judge-made, common-law doctrine--and for a good reason. 
Secondary liability prevents the use of indirect means to achieve 
illegal ends. Consequently, the scope of secondary liability must be 
flexible--otherwise, it would just instruct wrong-doers on how to 
legally encourage or manipulate others into breaking the law. The 
common-law judicial process is ideally suited to evolve flexible 
secondary-liability rules from the results of many individual cases.
  As a result, Congress rarely codifies secondary liability. It has 
codified secondary liability to narrow it, as in the Patent Act. 
Congress has codified secondary liability in the Criminal Code to 
ensure that the narrow construction given criminal statutes would not 
foreclose secondary liability. In the Digital Millennium Copyright Act, 
Congress codified a complex balance between opposed interests that 
expanded one type of secondary liability and narrowed another.
  Congress has always assumed that infringers could readily induce 
consumers to accept infringing copies of works. It thus created ``a 
potent arsenal of remedies against an infringer . . . .'' But secondary 
liability often arises if a third party can be ordered or induced to 
make the infringing copies. Consequently, only after copying devices 
became available to people who might be induced to infringe did 
questions about secondary liability for infringement become pressing.
  In 1984, these questions reached the Supreme Court in Sony Corp. v. 
Universal City Studios, Inc. Sony held that the makers of the Betamax 
VCR could not be held secondarily liable in a civil suit brought by 
copyright holders--even though some consumers would use VCRs to make 
infringing copies of copyrighted TV broadcasts.
  Sony also created a broader limitation on secondary liability by 
importing a limitation that that Congress had codified only in the 
Patent Act; this was the substantial-noninfringing-use rule, also 
called the ``staple article of commerce'' doctrine. Sony intended this 
rule to strike, as between creators of works and copying equipment, the 
same ``balance'' that it had struck under the Patent Act between the

[[Page S7190]]

rights of patent holder and makers of staple products.
  Under the Patent Act, the substantial-noninfringing-use rule bars 
secondary liability for selling a ``staple'' product that has a 
``substantial noninfringing use''--even if that staple could also be 
used as a component in an infringing copy of a patented invention. This 
rule protects makers of staples without changing the nature of 
secondary liability. In particular, it does not immunize bad actors who 
intend to distribute ``patent-infringement kits.'' Even in the rare 
case of a novel invention that consists only of ``staple'' components, 
an ``infringement kit'' must bundle components and include assembly 
instructions. Neither the bundle nor the instructions will likely have 
a ``substantial noninfringing use.''

  Sony intended this rule to strike the same admirable ``balance'' 
under the Copyright Act. Unfortunately, Sony also proposed that if this 
rule proved problematic, Congress should alter it on a technology-by-
technology basis. This proposal was flawed: In 1976, Congress redrafted 
the Copyright Act to avoid the need to re-adjust copyrights on a 
technology-by-technology basis because legislation could no longer keep 
pace with technological change. Returning to this impractical 
technology-based approach would create an endless procession of ``tech-
mandate'' laws that discriminate between technologies Congress deems 
``good'' or ``bad.'' But technologies are rarely inherently either 
``good'' or ``bad.'' Most can be used for either purpose; the effect 
depends on details of implementation impossible to capture--or 
predict--in prospective legislation.
  Of course, the dysfunctional corrective mechanism that Sony proposed 
would have become problematic only if the Sony limitation was 
misunderstood or misapplied by lower courts. Unfortunately, that has 
now happened.
  In cases like Napster and Grokster, lower courts misapplied the 
substantial-non-infringing-use limitation. These courts forgot about 
``balance'' and held that this limitation radically alters secondary 
liability. In effect, these cases retained secondary liability's 
control prong but collapsed its inducement prong. The results of these 
cases prove this point: Napster imposed liability upon a distributor of 
copying devices who controlled infringing users; Grokster did not 
impose liability upon distributors who appeared to induce and profit 
from users' infringement.
  A secondary-liability rule that punishes control and immunizes 
inducement is a public policy disaster. It seems to permit the 
distribution of ``piracy machines'' designed to make infringement easy, 
tempting, and automatic. Even Harvard's Berkman Center for Internet and 
society suggests that this is happening. The Center warns that ``it can 
be extremely difficult for a non-expert computer user to shut down'' 
the viral redistribution that can otherwise automatically make the user 
an international distributor of infringing works. The Center notes that 
the ``complexity of KaZaA's installation and disabling functions'' may 
leave many users unaware that they have become a contributor to global, 
for-profit copyright piracy. Unfortunately, ``piracy machines'' 
designed to mislead their users are just one of the perverse effects of 
a secondary liability rule that punishes control and immunizes 
inducement.
  Perhaps the least perverse of these effects has been years of 
conflict between the content and technology industries. Content 
creators sought the tech-mandate ``corrections'' that Sony proposed. 
Technology industries opposed such laws because they too easily 
foreclose innocent or unforeseen applications. P2P software illustrates 
the problem: Today, most P2P software functions like Earthstation 5's 
``piracy machine.'' Yet all agree that non-piracy-adapted 
implementations of P2P could have legitimate and beneficial uses.
  A rule that punishes only control also produces absurd results. 
Secondary liability should focus on intent to use indirect means to 
achieve illegal ends. A rule that punishes only control degenerates 
into inane debate about which indirect means was used. Thus Napster and 
Grokster are regulated differently--though they function similarly from 
the perspective of the user, the distributor, or the copyright holder.
  A rule that punishes only control also acts as a ``tech-mandate'' 
law: It mandates the use of technologies that avoid ``control''--
regardless of whether they are suited for a particular task. Napster 
was punished for processing search requests efficiently on a 
centralized search index that it controlled. Grokster escaped by 
processing search requests less efficiently on a decentralized search 
index that it did not control. Rewarding inefficiency makes little 
sense.
  A secondary-liability rule that punishes only control also punishes 
consumers: It encourages designers to avoid ``control'' by shifting 
risks onto consumers. For example, Napster incurred billion-dollar 
liability because it controlled computers housing a search index that 
located infringing files. Programs like Kazaa avoid Napster's 
``control'' by moving their search indices onto computers owned by 
unsuspecting consumers. Consumers were never warned about the risks of 
housing these indices. As a result, many consumers, universities, and 
businesses now control computers that house ``mini-Napsters''--parts of 
a search index much like the one that destroyed Napster. These indices 
could still impose devastating liability upon anyone who ``controls'' a 
computer housing them. A secondary-liability rule that punishes only 
control thus rewards Kazaa for shifting huge risks onto unsuspecting 
consumers, universities and businesses.
  And search indices are just one of the risks that designers of P2P 
software seem to impose upon their young users to avoid control. For 
example, the designers of most filesharing software choose to lack the 
ability to remove or block access to files known to contain viruses, 
child pornography or pornography mislabeled to be appealing to 
children. This ability could create ``control'' and trigger liability. 
Aiding distributors of viruses and pornography may be just an 
unfortunate side effect of avoiding control while inducing 
infringement.
  A secondary-liability rule that immunizes inducement also encourages 
attempts to conceal risks from consumers: It is easier to induce people 
to take risks if they are unsure whether they are incurring a risk or 
its severity. The interfaces of most P2P software provide no warnings 
about the severe consequences of succumbing to the constant temptation 
of infringement.
  Another risk to users of P2P software arises when pornography 
combines with the ``viral redistribution'' that thwarts removal of 
infringing copies of works. Most filesharing networks are awash in 
pornography, much of it mislabeled, obscene, illegal child pornography, 
or harmful to minors. Anyone risks criminal prosecution if they 
distribute pornography accessible to minors over these child-dominated 
networks. As a result, one P2P distributor who does distribute 
``adult'' content demands that it be protected by access controls. But 
every adult who uses this distributor's software as intended to 
download one of millions of unprotected pornographic files 
automatically makes that pornography available for re-distribution to 
millions of children. This distributor has sat silently--knowing that 
its software exposes millions of its users to risks of criminal 
prosecution that the distributor cannot be paid to endure.
  Perhaps the worst effect of punishing control and rewarding 
inducement is that it achieves precisely what Sony sought to avoid: It 
leaves copyright holders with an enforcement remedy that is ``merely 
symbolic'': It seems real, but it is illusory.
  In theory, a rule that immunizes inducement still permits enforcement 
against those induced to infringe. At first, this remedy seems viable 
because copyrights have traditionally been enforced in lawsuits against 
direct infringers who actually make infringing copies of works.
  But a fallacy lurks here: The ``direct infringers'' at issue are not 
the traditional targets for copyright enforcement. In fact, they are 
children and consumers: They are the hundreds of millions of 
Americans--toddlers to seniors--who use and enjoy the creative works 
that copyrights have helped create.
  There is no precedent for shifting copyright enforcement toward the 
end-

[[Page S7191]]

users of works. For nearly 200 years, copyright law has been nearly 
invisible to the millions who used and enjoyed creative works. 
Copyright law was invisible to consumers because the law gave creators 
and distributors mutual incentives to negotiate the agreements that 
ensured that works reached consumers in forms that were safe to use in 
foreseeable ways. Now, those incentives are collapsing. As a result, 
artists must now waive their rights or sue consumers--their fans.
  Worse yet, artists must sue their fans for the sin of misusing 
devices designed to be easy and tempting to misuse. That is unfair: 
When inducement is the disease, infringement can be seen as just a 
symptom. Yet artists must ignore inducers who profit by chanting, 
``Hey, kids, infringement is cool, and we will help you get away with 
it.'' Instead, artists can only sue kids who succumb to this 
temptation. They must leave Fagin to his work--and sue Oliver Twist.
  This sue-Oliver ``remedy'' is a debacle. For example, immunizing 
inducement ensures that artists will have to sue their fans: Inducers 
will have both the incentive and the means to thwart less extreme 
measures, like educational campaigns. For example, RIAA tried to avoid 
lawsuits against filesharers by sending educational instant messages to 
infringers. Kazaa, for ``privacy'' reasons, disabled instant messaging 
by default in the next version of its software. Lawsuits then followed.
  And imagine the poor parent who tries to tell a teenager that free 
downloading of copyrighted music is illegal. The teenager, confused 
because ``everyone is doing it,'' consults a leading technology-news 
site promising a ``trusted source of information for millions of 
technology consumers.'' There, the teenager finds a P2P distributor 
promoting ``Morpheus 4.0, the only American filesharing software ruled 
legal by a U.S. federal court.'' This statement is false: Grokster did 
not rule Morpheus ``legal''; in fact, the case only confirmed that 
downloading copyrighted works is illegal. Below this misinformation, 
the teenager will find an independent editorial review rating Morpheus 
4.0 as a ``Recommended'' download and ``an excellent choice'' for those 
seeking ``the latest and greatest.'' Who will the teenager believe?
  Worse yet, if artists must sue only the induced, they just feed the 
contempt for copyrights that inducers breed. Inducers know that people 
induced to break a law become that law's enemies: Once you break a law, 
you must either admit wrongdoing or rationalize your conduct. 
Rationalization is often so easy. You can blame the law: Copyright is a 
stupid law needlessly enshrined in the Constitution by naives like 
James Madison. You can blame the victim: Some rock stars still make 
money; I do not like the ``business model'' of the record labels. You 
can blame the randomness of enforcement: Everyone else was doing it, so 
why not me? Anyone who has talked to young people about filesharing has 
heard such rationalizations time and again.
  And forcing artists to ignore inducers and sue the induced locks 
artists into a war of attrition that they are unlikely to win. If you 
imagine inducement as a bush, this ``remedy'' forces artists to spend 
their money to sever each leaf--while the inducer makes money by 
watering the root. Artists may not be able to sustain this unending 
battle.
  This may let inducers attempt an extortionate form of 
``outsourcing.'' Inducers can increase or decrease their devices 
propensity to encourage piracy. Inducers can thus tell American artists 
that if the artists pay the inducers to become licensed distributors of 
their works, perhaps fewer bad things will happen. Implicitly, if 
artists do not pay, perhaps more bad things will happen. Were artists 
to succumb to such tactics, jobs and revenues created by the demand for 
American creative works would go overseas to some unsavory locales.
  Worst of all, inducers will inevitably target children. Children 
would be easily induced to violate complex laws like the Copyright Act. 
Any child is a terrible enforcement target. And because most adults 
never induce children to break laws, children induced to infringe 
copyrights would not even be ``bad kids.'' Indeed, they would probably 
be smart, mostly law-abiding young people with bright futures. 
Innocent, mostly law-abiding children make the worst enforcement 
targets--and thus the best ``human shields'' to protect an inducer's 
business model.
  This threat to children is real. Today, artists are suing high-volume 
filesharers who cannot be identified until late in the process. One 
filesharer sued for violating federal law over 800 times turned out to 
be a 12-year-old female honor student. This otherwise law-abiding young 
girl and her family then faced ruin by the girl's favorite artists. The 
public knew that something was wrong, and it was outraged. So the 
people who gave that girl an easily misused toy--and profited from her 
misuse of it--exploited public outrage with crocodile tears about the 
tactics of ``Big Music.'' And then, I imagine, they laughed all the way 
to the bank.
  The Supreme Court could not have intended to force artists to sue 
children in order to reduce the profits that adults can derive by 
encouraging children to break the law. No one would intend that. Yet it 
seems to be happening.
  These are the inevitable results of a secondary-liability rule that 
immunizes inducement. This ``rule'' has created the largest global 
piracy rings in history. These rings now create billions of infringing 
copies of works, and reap millions in profits for leaders who insulate 
themselves from direct involvement in crime by inducing children and 
students to ``do the dirty work'' of committing illegal or criminal 
acts. These rings then thwart deterrence and condemn attempts to 
enforce the law. These rings may now use profits derived from rampant 
criminality to extort their way into the legal Internet distribution 
market--a market critical to the future of our artists and children.
  This must stop--and stop now. Artists have tried: They targeted for-
profit inducers. But artists were thwarted by a court ruling that held, 
in effect, that although artists can sue exploited children and 
families into bankruptcy, courts need ``additional legislative 
guidance'' to decide whether artists can, instead, sue the corporations 
that profit by inducing children to break the law. I find this 
assertion wholly inconsistent with the intent of both Congress and the 
Supreme Court. But until this fundamentally flawed ruling is overruled 
by legislation or higher courts, artists cannot hold inducers liable 
for their actions.
  Fortunately, Congress has charged the Department of Justice to 
enforce the Criminal Code. In the Criminal Code, Congress made it a 
Federal crime to willfully infringe copyrights or to distribute obscene 
pornography or child pornography. Congress also made it a crime to 
induce anyone--child or adult--to commit any Federal crime.
  Indeed, Congress codified many forms of criminal secondary liability 
in the Criminal Code. I have already quoted its first sentence. Here is 
its second: ``Whoever willfully causes an act to be done which if 
directly performed by him or another would be an offense against the 
United States, is punishable as a principal.'' One court has said that 
this ensures that ``[a] crime may be performed through an innocent 
dupe, with the essential element of criminal intent residing in another 
person.'' Not coincidentally, some Federal prosecutors worry that P2P 
software makes infringement so tempting, easy and automatic that many 
of its users will lack criminal intent. Perhaps--but their relative 
innocence will not protect their inducers.
  The Criminal Code also codifies other forms of secondary liability, 
like this one:

       If two or more persons conspire to injure, oppress, 
     threaten any person in any State . . . in the free exercise 
     or enjoyment of any right or privilege secured to him by the 
     Constitution or the laws of the United States, . . . [t]hey 
     shall be fined under this title or imprisoned not more than 
     ten years, or both. . . .

  These examples of laws imposing secondary criminal liability have 
something in common: Congress codified no exceptions for ``substantial 
non-criminal uses.'' The message is clear: Those who induce others to 
commit crimes cannot avoid prison by showing that some of them 
resisted. I will work with my colleagues in Congress to ensure that the 
Department of Justice enforces the Federal laws that prevent

[[Page S7192]]

anyone from inducing violations of any Federal law by our citizens, our 
students, or our children.
  Congress, too, must do its part by enacting the Inducing Infringement 
of Copyrights Act, S. 2560. This bill will protect American artists, 
children and taxpayers by restoring the privately funded civil remedy 
crippled by the Grokster ruling. Congress must act: A Federal court has 
held that artists can only enforce their rights by suing exploited 
children and students pending ``additional legislative guidance'' about 
whether artists can, instead, sue the corporations that profit by 
inducing children to break laws and commit crimes. Silence could be 
misinterpreted as support for those who profit by corrupting and 
endangering others. This bill will restore the tried, privately funded 
civil enforcement actions long used to enforce copyrights.
  This bill will also preserve the Sony ruling without reversing, 
abrogating or limiting it. The Inducement Act will simply import and 
adapt the Patent Act's concept of ``active inducement'' in order to 
cover cases of intentional inducement that were explicitly not at issue 
in Sony. The Inducement Act also preserves the Section 512 safe harbors 
for Internet service providers.
  The bill also contains a savings clause to ensure that it provides 
the ``guidance'' courts have requested--not an iron-clad rule of 
decision for all possible future cases. This flexibility is critical 
because just as infringement cases are fact specific, so should 
inducement cases center on the facts of a given case, with courts 
endowed with the flexibility to impose just results. This bill does not 
purport to resolve or affect existing disagreements about when copies 
made and used within an individual's home environment are permissible 
and when they are infringing.
  Rather, this bill is about the intentional inducement of global 
distribution of billions of infringing copies of works at the prodding 
and instigation of sophisticated corporations that appear to want to 
profit from piracy, know better than to break the law themselves, and 
try to shield themselves from secondary liability by inducing others to 
infringe and then disclaiming control over those individuals.

  I also want to thank everyone who has worked with us to craft a bill 
that addresses this serious threat to children and copyrights without 
unduly burdening companies that engage in lawful commerce in the wide 
range of devices and programs that can copy digital files. As Sony 
illustrates, clear knowledge that a copying device can be used to 
infringe does not provide evidence of intent to induce infringement. It 
was critical to find a way to narrowly identify the rare bad actors 
without implicating the vast majority of companies that serve both 
consumers and copyright-holders by providing digital copying devices--
even though these devices, like all devices, can be misused for 
unlawful purposes. In particular, I would like to thank the Business 
Software Alliance for its invaluable assistance in crafting a bill that 
protects existing legitimate technologies and future innovation in all 
technologies--including peer-to-peer networking.
  Senator Leahy and I look forward to working with all affected parties 
to enact this bill and restore the balance and private enforcement that 
Sony envisioned. But until Congress can enact the Inducing Infringement 
of Copyrights Act, the duty and authority to stop inducement that 
targets children and students resides in the Department of Justice that 
Congress has charged to protect artists, commerce, citizens and 
children. The Department must act now to clarify some simple facts: 
America has never legalized the ``business model'' of Fagin and Bill 
Sykes. Modern ChildCatchers cannot lawfully profit by luring children 
into crime with false promises of ``free music.''
  Mr. President, I urge all of my colleagues to support S. 2560, the 
Inducing Infringement of Copyrights Act.
  I ask unanimous consent that the text of the bill be printed in the 
Record.

                                S. 2560

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Inducing Infringement of 
     Copyrights Act of 2004''.

     SEC. 2. INTENTIONAL INDUCEMENT OF COPYRIGHT INFRINGEMENT.

       Section 501 of title 17, United States Code, is amended by 
     adding at the end the following:
       ``(g)(1) In this subsection, the term `intentionally 
     induces' means intentionally aids, abets, induces, or 
     procures, and intent may be shown by acts from which a 
     reasonable person would find intent to induce infringement 
     based upon all relevant information about such acts then 
     reasonably available to the actor, including whether the 
     activity relies on infringement for its commercial viability.
       ``(2) Whoever intentionally induces any violation 
     identified in subsection (a) shall be liable as an infringer.
       ``(3) Nothing in this subsection shall enlarge or diminish 
     the doctrines of vicarious and contributory liability for 
     copyright infringement or require any court to unjustly 
     withhold or impose any secondary liability for copyright 
     infringement.''.

  Mr. LEAHY. Mr. President, nobody can deny that the digital age has 
brought many benefits and many challenges to all of us.
  In my home state of Vermont, the Internet has revolutionized how we 
work and how we learn: Distance learning brings the best teaching tools 
right into rural communities, and new business models let Vermont 
businesses reach new and far-flung customers. As suppliers who use the 
Internet, we enjoy access to a range of goods and services unimagined 
when I was growing up, and the vast panoply of information and 
entertainment offerings on the World Wide Web are at the fingertips of 
many Vermonters. Of course, we must work to ensure that everyone can 
reap the benefits of the digital age, and I am striving both here in 
Washington and in my state to do what is necessary to bring affordable 
and reliable Internet access to every household.
  I am confident that, with continued focus and perseverance, the day 
of universal access is coming and we will all take part in the many 
advantages of the digital age. But there are other problems that 
require immediate attention, because they threaten the development of 
the web. We will never be able to make the Internet an entirely 
trouble-free zone, but we will also never be justified in failing to 
make efforts to defend and improve it.
  One important effort to improve it is the bill that I am proud to 
introduce today--along with Senators Hatch, Daschle, Frist, Boxer, and 
Graham of South Carolina--the ``Inducing Infringement of Copyright Act 
of 2004.''
  The ``Inducing Infringement of Copyright Act of 2004'' is a 
straightforward bill. Our legislation treats those who induce others to 
violate copyrights as infringers themselves. This is not a novel 
concept; it is the codification of a long-standing principle of 
intellectual property law: that infringement liability reaches not only 
direct infringers but also those who intentionally induce illegal 
infringement. And while the legal principle is an old one, the problems 
of inducement for copyright are a relatively new byproducts of the 
digital age--an age in which it is easy, and often profitable, to 
induce others to violate copyrights through illegal downloading from 
the Internet.
  The principle at the heart of this bill--secondary copyright 
liability--has long been in the common law. In fact, such secondary 
liability is provided for by statute in the patent law. The patent code 
provides liability for inducing infringement and for the sale of 
material components of patented machines, when the components are not a 
staple article of commerce suitable for substantial non-infringing use. 
This is because it has long been relatively simple and economically 
worthwhile to induce patent infringement. By contrast, until recently 
the ability to illegally download music, books, software, and films has 
not existed. Recent developments, however, now make it necessary for 
Congress to clarify that this principle also applies to copyrights.
  What the inducement bill does not do is just as important as what it 
does: It does not target technology. Useful legislation on this topic 
must address the copyright issue and not demonize certain software. As 
a practical matter, if a law is targeted at certain software, the 
designers will simply design around the law and render it useless. And 
as a matter of effectiveness, if the law addresses only well-understood 
present threats, it will necessarily be too narrow to encompass future 
technologies that may pose the same threat to copyrights. A law that 
deals simply with

[[Page S7193]]

the copyrights--and their violation--is far less likely to be 
circumvented or out-dated before it can do any good. It will be both 
broad enough and sufficiently flexible to accommodate situations we 
cannot foresee.
  This legislation is also carefully crafted to preserve the doctrine 
of ``fair use.'' Indeed by targeting the illegal conduct of those who 
have hijacked promising technologies, we can hope that consumers in the 
future have more outlets to purchase creative works in a convenient, 
portable digital format. Similarly, the bill will continue to promote 
the development of new technologies as it will not impose liability on 
the manufacturers of copying technology merely because the possibility 
exists for abuse. Finally, the bill will not affect Internet service 
providers who comply with the safe harbor provisions of the Digital 
Millennium Copyright Act.
  Copyright law protecting intellectual property is one of the taproots 
of our economy and of our creativity as a nation. For copyright law to 
work as the Founders intended, it needs effective enforcement. That 
means adapting enforcement tools to meet new challenges, in the digital 
age or in any age. And that is the straightforward purpose of this 
bill.
  I would like to take a moment also to emphasize another important, if 
obvious, point about this bill that some detractors have ignored. The 
law only penalizes those who intentionally induce others to infringe 
copyrights. Thus, the makers of electronic equipment, the software 
vendors who sell email and other programs, the Internet service 
providers who facilitate access to the Web--all of these entities have 
nothing to fear from this bill. So long as they do not conduct their 
businesses with the intention of inducing others to break the law--and 
I certainly have not heard from anyone who makes that claim--they 
should rest easy. The only actors who have anything to fear are those 
that are already breaking the law; this bill simply clarifies and 
codifies that long-standing doctrine of secondary liability.
  The ``Inducing Infringement of Copyright Act of 2004'' is a simple 
fix to a growing problem. The bill protects the rights inherent in 
creative works, while helping to ensure that those same works can be 
easily distributed in digital format.
  Mr. FRIST. Mr. President, I rise in support of the Inducing 
Infringement of Copyrights Act of 2004 introduced today by Senators 
Hatch and Leahy. I am proud to be an original cosponsor. The Inducement 
Act addresses the growing problem of online piracy--the illegal 
downloading of copyrighted music. Piracy is devastating the music 
community and threatening other forms of copyrighted work. This 
commonsense, bipartisan legislation takes important steps in protecting 
our Nation's intellectual property.
  When I return home to Nashville and drive down Music Row, my heart 
sinks as I see the ``For Sale'' and ``For Rent'' signs everywhere. The 
once vibrant music community is being decimated by online piracy. No 
one is spared. It is hitting artists, writers, record companies, 
performing rights organizations, and publishers.
  Every month 2.6 billion music files are illegally downloaded using 
peer-to-peer networks, and it is not unusual for albums to show up on 
the Internet before they make it to the record store. The effect of 
this theft of intellectual property is disastrous to the creative 
industry. In the end, rampant piracy dries up income and drives away 
professional musicians. We get fewer artists and less music.
  Online piracy affects more than just the music industry. It affects a 
broad swath of the creative field, including the movie and software 
industries. Music, movies, books, and software contribute well over 
half a trillion dollars to the U.S. economy each year and support 4.7 
million workers. When our copyright laws are blatantly ignored or 
threatened, an enormous sector of our economy and creative culture is 
threatened.
  The intent of the anti-piracy bill being introduced today is simple. 
It holds liable those who intentionally induce others to commit illegal 
acts of copyright infringement. In other words, it targets the bad 
actors who are encouraging others to steal. In addition, the general 
cause of action in this bill is not new or revolutionary. It is based 
on the theory of secondary liability that is found squarely in our 
Nation's laws.
  This bill should not and does not threaten in any manner the further 
advancement of technology. It is not a technology mandate. Only 
individuals or organizations which profit from intentionally 
encouraging others to violate our copyright laws should fear this 
legislation. It has been carefully crafted and will be thoroughly 
reviewed to ensure that its language accurately reflects its sound 
intent.
  The future of the music community is with advancing technology, and I 
encourage those in the music field to continue to offer innovative 
choices to consumers. It is important to recognize, however, that no 
one in the music industry or any other intellectual property field can 
survive when his or her work is being stolen. Those who are 
intentionally and actively encouraging this theft should be held 
accountable.
  I would like to thank Senator Hatch for his hard work on this bill 
and his dedication to this issue. I would also like to thank Senator 
Leahy for his work. This is truly a bipartisan issue, and I look 
forward to working with Members on both sides of the aisle to ensure 
that our intellectual property laws are respected and enforced.

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