[Congressional Record Volume 151, Number 87 (Monday, June 27, 2005)]
[House]
[Page H5224]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




       INTELLECTUAL PROPERTY PROTECTION AND THE GROKSTER DECISION

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from California (Mr. Schiff) is recognized for 5 minutes.
  Mr. SCHIFF. Mr. Speaker, today the United States Supreme Court, in a 
unanimous 9-0 decision, held that peer-to-peer file-swapping companies 
can be held liable if they promote the use of their sites to infringe 
copyright. The Grokster decision is a victory for all law-abiding 
Americans, especially the hardworking and talented individuals that 
make up our creative industries.
  I am pleased that the Supreme Court struck the right balance between 
the protection of intellectual property and the desire to provide 
consumers with easy and lawful access to movies, music, and other 
content. Impressive advances in technology in recent years have 
produced a host of new and exciting avenues for consumers to access 
music and other content online. These new technologies, however, have 
also bred a culture of rampant pirating on the Internet.
  Grokster and other peer-to-peer networks have become bastions of 
illegal activity, providing safe havens for pirates to swap copied 
versions of copyrighted material without paying a cent. Every day, 
millions of copyrighted protected movies, songs, computer games, and 
other pieces of intellectual property are stolen over peer-to-peer 
networks.
  The statistics speak for themselves. Over 90 percent of the file-
sharing activity on Grokster is illegal copyright infringement. Of the 
music files available online, 99 percent are unauthorized, leading to a 
substantial drop in shipments of music to retailers.
  In the last year alone, the number of feature films posted on file-
sharing sites more than doubled to 44 million. Some estimates show that 
as many as 400,000 movies have been downloaded in one day alone.
  Last month, it took just a few hours after the latest Star Wars movie 
opened in theaters for a copy to show up online on a file-sharing site. 
While so many Americans flocked to movie theaters across the country 
with their children and families to see the latest episode of this 
great Hollywood franchise, millions had access to an unauthorized copy 
of the film online, free for theft and the taking.
  Our Nation's economy and creative industries that employ over 5 
million Americans suffer a huge blow from the billions of dollars lost 
annually through illegal downloading. These networks that actively 
promote illegal activity continue to pose a serious threat to the 
livelihood of copyright creators and artists, many of whom live in my 
district.
  One of our country's greatest exports, indeed the only area where we 
have a positive balance of trade with every Nation on earth, is in the 
area of creative content and our intellectual property, which is 
derived from the hard work of song writers, technicians, artists, 
programmers, musicians, independent filmmakers and scores of others who 
make their living from the lawful sale of these items.
  The Supreme Court decision today strikes the right balance by 
protecting copyright holders from such illegal activity and promoting 
legal avenues for downloading movies, music, and other works by 
consumers.
  Very simply, the Court decision today codifies an age-old principle: 
that one man should not profit from the fruit of another man's labor.
  As the Court noted, their decision leaves breathing room for 
innovation, and a vigorous commerce and does nothing to compromise the 
legitimate commerce or discourage innovation having a lawful purpose.
  Today's ruling upholds the principle that technology must and should 
advance, but not without respecting copyright law. Just moments after 
today's decision, a new legal peer-to-peer model was unveiled that will 
incorporate many user benefits common to the peer-to-peer file-sharing 
experience, and a number of sites have already been launched that offer 
Internet music downloads at affordable prices without infringing on 
copyright laws. These positive efforts provide a victory for both 
consumers and artists.
  Today's decision will further encourage and spur even more 
technological innovation. As a result, consumers will be the ultimate 
winners as they will have more access to high-quality music, film, and 
other content on the Internet and elsewhere.

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