[Congressional Record Volume 160, Number 31 (Tuesday, February 25, 2014)]
[House]
[Pages H1904-H1913]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         UNLOCKING CONSUMER CHOICE AND WIRELESS COMPETITION ACT

  Mr. GOODLATTE. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 1123) to promote consumer choice and wireless competition by 
permitting consumers to unlock mobile wireless devices, and for other 
purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 1123

       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 ``Unlocking Consumer Choice 
     and Wireless Competition Act''.

     SEC. 2. REPEAL OF EXISTING RULE AND ADDITIONAL RULEMAKING BY 
                   LIBRARIAN OF CONGRESS.

       (a) Repeal and Replace.--As of the date of the enactment of 
     this Act, paragraph (3) of section 201.40(b) of title 37, 
     Code of Federal Regulations, as amended and revised by the 
     Librarian of Congress on October 28, 2012, pursuant to the 
     Librarian's authority under section 1201(a) of title 17, 
     United States Code, shall have no force and effect, and such 
     paragraph shall read, and shall be in effect, as such 
     paragraph was in effect on July 27, 2010.
       (b) Rulemaking.--
       (1) In general.--The Librarian of Congress, upon the 
     recommendation of the Register of Copyrights, who shall 
     consult with the Assistant Secretary for Communications and 
     Information of the Department of Commerce and report and 
     comment on his or her views in making such recommendation, 
     shall determine, consistent with the requirements set forth 
     under section 1201(a)(1) of title 17, United States Code, 
     whether to extend the exemption for the class of works 
     described in section 201.40(b)(3) of title 37, Code of 
     Federal Regulations, as amended by subsection (a), to include 
     any other category of wireless devices in addition to 
     wireless telephone handsets.
       (2) Timing of rulemaking.--(A) If this Act is enacted 
     before June 1, 2014, the determination under paragraph (1) 
     shall be made by not later than the end of the 9-month period 
     beginning on the date of the enactment of this Act.
       (B) If this Act is enacted on or after June 1, 2014, the 
     determination under paragraph (1) shall be made in the first 
     rulemaking

[[Page H1905]]

     under section 1201(a)(1)(C) of title 17, United States Code, 
     that begins on or after the date of the enactment of this 
     Act.
       (c) Unlocking at Direction of Owner.--
       (1) In general.--Circumvention of a technological measure 
     that restricts wireless telephone handsets or other wireless 
     devices from connecting to a wireless telecommunications 
     network--
       (A)(i) as authorized by paragraph (3) of section 201.40(b) 
     of title 37, Code of Federal Regulations, as made effective 
     by subsection (a), and
       (ii) as may be extended to other wireless devices pursuant 
     to a determination in the rulemaking conducted under 
     subsection (b), or
       (B) as authorized by an exemption adopted by the Librarian 
     of Congress pursuant to a determination made on or after the 
     date of enactment of this Act under section 1201(a)(1)(C) of 
     title 17, United States Code,
     may be initiated by the owner of any such handset or other 
     device, by another person at the direction of the owner, or 
     by a provider of a commercial mobile radio service or a 
     commercial mobile data service at the direction of such owner 
     or other person, solely in order to enable such owner or a 
     family member of such owner to connect to a wireless 
     telecommunications network, when such connection is 
     authorized by the operator of such network.
       (2) No bulk unlocking.--Nothing in this subsection shall be 
     construed to permit the unlocking of wireless handsets or 
     other wireless devices, for the purpose of bulk resale, or to 
     authorize the Librarian of Congress to authorize 
     circumvention for such purpose under this Act, title 17, 
     United States Code, or any other provision of law.
       (d) Rule of Construction.--Except as provided in subsection 
     (c), nothing in this Act alters, or shall be construed to 
     alter, the authority of the Librarian of Congress under 
     section 1201(a)(1) of title 17, United States Code.
       (e) Definitions.--In this Act:
       (1) Commercial mobile data service; commercial mobile radio 
     service.--The terms ``commercial mobile data service'' and 
     ``commercial mobile radio service'' have the respective 
     meanings given those terms in section 20.3 of title 47, Code 
     of Federal Regulations, as in effect on the date of the 
     enactment of this Act.
       (2) Wireless telecommunications network.--The term 
     ``wireless telecommunications network'' means a network used 
     to provide a commercial mobile radio service or a commercial 
     mobile data service.
       (3) Wireless telephone handsets; wireless devices.--The 
     terms ``wireless telephone handset'' and ``wireless device'' 
     mean a handset or other device that operates on a wireless 
     telecommunications network.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Virginia (Mr. Goodlatte) and the gentleman from Virginia (Mr. Scott) 
each will control 20 minutes.


                         parliamentary inquiry

  Mr. POLIS. Mr. Speaker, I have a parliamentary inquiry.
  The SPEAKER pro tempore. The gentleman will state his parliamentary 
inquiry.
  Mr. POLIS. I don't believe there is a rule for this bill. Is there a 
rule for this bill?
  The SPEAKER pro tempore. The Chair is referring to a standing rule of 
the House.
  Mr. POLIS. Mr. Speaker, I claim the time in opposition.
  The SPEAKER pro tempore. Is the gentleman from Virginia in favor of 
the motion?
  Mr. SCOTT of Virginia. Mr. Speaker, I am in favor of the motion. I am 
not opposed to the bill
  The SPEAKER pro tempore. On that basis, pursuant to the rule, the 
gentleman from Colorado (Mr. Polis) will control the 20 minutes in 
opposition.
  The gentleman from Virginia (Mr. Goodlatte) is recognized.


                             General Leave

  Mr. GOODLATTE. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days in which to revise and extend their remarks 
and include extraneous materials on H.R. 1123, currently under 
consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may 
consume.
  Last winter, due to an expired exemption to existing law, consumers 
lost the legal right to unlock their cell phones so that they could use 
them on a different wireless carrier. Outraged consumers flooded 
Congress and the White House with complaints over this change in policy 
that resulted in reduced marketplace competition.
  In response to this impact on consumers, a bipartisan group of House 
Judiciary Committee members introduced H.R. 1123, the Unlocking 
Consumer Choice and Wireless Competition Act. The legislation 
reinstates the prior exemption to civil and criminal law for unlocking 
cell phones for personal use. It also creates an expedited process to 
determine whether this exemption should be extended to other wireless 
devices such as tablets.
  When this legislation is enacted, consumers will be able to go to a 
kiosk in the mall, get help from a neighbor, or see a wireless carrier 
to help unlock their cell phone without any risk of legal penalties. 
This is not the case today, which is why this legislation is necessary.
  H.R. 1123 is supported by such diverse groups in the cellular 
industry, from the large carriers of CTIA to the small carriers of the 
Competitive Carriers Association.
  Although these two groups announced a private sector agreement in 
December on unlocking based upon this same legislation, that agreement 
cannot eliminate the potential of civil and criminal sanctions for 
consumers who unlock their cell phones. So the need for the legislation 
remains. Even Consumers Union supports this critical legislation.

                              {time}  1600

  The committee has been aware of law enforcement concerns regarding 
the explosive growth in smartphone thefts. Efforts by criminals to 
undertake bulk unlocking and transfers of stolen phones are a growing 
concern in America. Smartphones seem to have become crime magnets in 
many cities across America.
  Because the policy issue has always focused on the ability of 
consumers to unlock their phones, the legislation is similarly focused 
on individual consumer unlocking without raising law enforcement 
concerns. Why would it make sense for Congress to enable criminal gangs 
to more easily make money off stolen phones instead of simply solving 
the main issue of consumers being able to unlock their own phones?
  Some would like this legislation to go even further. However, I hope 
all can agree that this is a good start and a solid piece of 
legislation that will empower consumer choice.
  I urge my colleagues to support this important proconsumer 
legislation, and I reserve the balance of my time.
  Mr. POLIS. Mr. Speaker, I yield myself such time as I may consume, 
and I rise in opposition to the Unlocking Consumer Choice and Wireless 
Competition Act.
  I support the sentiment behind this bill, and I support the version 
that was reported out of the Judiciary Committee. However, 
unfortunately, an important change that I will discuss to the detriment 
of this bill was added last week, just prior to this bill being brought 
to the floor.
  The gentleman from Virginia (Mr. Goodlatte) gave some background with 
regard to why a bill is necessary. Ever since the Library of Congress 
ruled last year that unlocking your cell phone violates copyright law, 
there have been a number of us on both sides of the aisle who have 
worked to ensure that consumers have the right to unlock their wireless 
devices and use their property as they see fit.
  I am proud to be a cosponsor of Congresswoman Lofgren's bill, the 
Unlocking Technology Act of 2013, which gives consumers the right to 
unlock their devices on a permanent basis.
  Before I came to Congress, I was an entrepreneur who started a number 
of businesses, and I understand firsthand the importance of allowing a 
free market to thrive and to create a positive environment for 
businesses and consumers alike.
  Allowing consumers to unlock their cell phones, which are their own 
personal property, can spur competition, allowing new start-up carriers 
to succeed, lowering prices, and increasing service options for all 
cell phone users.
  To be clear, this is a separate issue from being contractually bound 
to use a certain provider for a certain period of time. Many Americans 
choose to enter into a long-term contract in exchange for discounts or 
free cell phones.
  That is not the issue being discussed today, and I don't think there 
is a problem from either side of the aisle about those consensual 
contracts.
  Rather, we are talking about unlocking cell phones that are not 
contractually bound to a certain service

[[Page H1906]]

provider. This has been an issue within our trade agreements.
  I have recently drafted bipartisan letters to the United States Trade 
Representative, with Representative Massie, expressing concern that the 
leaked text of the Trans-Pacific Partnership agreement would 
potentially make any permanent fix to unlocking cell phones illegal.
  Now, this bill is not a permanent fix. This bill would make clear 
congressional intent consistent with the optional agreement between the 
companies that they have reached. However, the last-minute change that 
was made in this bill, different from the bill that was passed out of 
committee, puts a real poison pill in this bill for consumer advocates, 
such as myself.
  The bill adds the language that nothing in this subsection shall be 
construed to permit the unlocking of wireless handsets or other 
wireless devices for the purpose of bulk resale or to authorize the 
Librarian of Congress to authorize circumvention for such purpose or 
any other provision of law.
  Now, while this gives, again, at least a patina of deniability that 
the bill is making a statement in one way or the other, the statement 
certainly implies that Congress believes that bulk unlocking is, in 
fact, illegal.
  Now, why is bulk unlocking important? When it comes to the actual 
technical skills necessary, many consumers are not going to be 
unlocking their phones themselves. There needs to be a market in 
unlocked phones for consumers to have the full ability and to be 
empowered to choose the provider of their choice.
  This bill does weigh in, with congressional intent, against the 
creation of a dynamic marketplace that increases consumer choice and 
options.
  I think, without this clause, this was a bill that made it clear that 
we can't use the Digital Millennium Copyrights Act to interfere with an 
issue that is unrelated to copyright, but with this clause, it suggests 
that perhaps the DMCA's clauses can be used for noncopyright issues if, 
perhaps, somebody doesn't like the motive behind the unlocker.
  So, as a result of this change, a number of organizations have 
withdrawn their support: iFixit, the Electronic Frontier Foundation, 
Public Knowledge, Generation Opportunity, and FreedomWorks.
  I hope to be able to continue to work with colleagues on both sides 
of the aisle to improve this bill, but with the current language, I do 
not believe, at this point, that this bill is a step forward for 
consumers.
  I reserve the balance of my time.
  Mr. GOODLATTE. Mr. Speaker, at this time, it is my pleasure to yield 
3 minutes to the gentleman from California (Mr. Issa), the chairman of 
the Oversight and Government Reform Committee.
  Mr. ISSA. I thank the chairman.
  Mr. Speaker, when I was alerted as to this change, like Mr. Polis, I 
asked, What will be the impact? And, at first glance, I was concerned 
that it could be a poison pill, that it could limit the ability, for 
example, for somebody to take trade-ins of thousands of phones and 
unlock them, but I found no such case because they are buying from an 
individual.

  At that moment, they choose to unlock it as part of the arrangement, 
and you now have an unlocked phone. There is no prohibition on buying 
500 unlocked phones and selling 500 unlocked phones.
  As a matter of fact, when I went through the language of bulk sales, 
I could find essentially no possible business plan that would require 
the unlocking of bulk phones, except as to buying from a wholesaler who 
did not intend them to be unlocked, intended them to be sold 
individually, unlocking them, and then selling them off to another 
party.
  Any transaction in which the product gets to an individual or in 
which unlocking occurs at the time of the individual is fully covered 
by this bill.
  So although I did share the concern of the gentleman from Colorado 
(Mr. Polis) that there was a scenario in which somebody would not be 
able to unlock a phone, I discovered that there was nothing that the 
consumer would be affected by that could possibly affect this.
  For example, let me say that, hypothetically, I am that individual, 
that company, and Mr. Polis and I have something in common, which is we 
both ran companies. If I am an individual and I want to buy 1,000 
locked phones, there is going to be an easy unlock capability. Third 
parties are going to be able to provide the unlock capability.
  I can buy 1,000 locked phones or 100,000 locked phones. I can sell 
them to somebody else, who sells them to somebody else. Anytime that 
company or individual is down to the end user who wants to unlock a 
phone, that capability is there.
  Mr. Polis is one of the most intelligent and knowledgeable and 
trained people in this area of anyone in Congress, but if we go through 
each of the workarounds that we, in business, would do, I can find no 
scenario whatsoever in which this would stop the consumer from 
receiving an unlocked phone, if they chose to, even if, in the interim 
basis, there were many transactions of 10 or 100,000 phones of bulk 
sale.
  It does not prevent the sale of unlocked bulk phones being sold and 
resold. It does not prevent the bulk sale of locked phones. So you only 
have to ensure, as I understand the law--and I have checked it against 
the language--that the unlocking occurs in support of the consumer.
  So though I share the opposition's concern, I believe--I have looked 
through, vetted it, and like Mr. Polis, as a businessman, I have found 
that it stops no business plan and hurts no consumer.
  I thank the chairman for bringing this legislation. I urge its 
support.
  Mr. GOODLATTE. Will the gentleman yield?
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. GOODLATTE. Mr. Speaker, I yield an additional 1 minute to the 
gentleman from California.
  Mr. ISSA. I yield to the gentleman from Virginia.
  Mr. GOODLATTE. I thank the gentleman for yielding.
  Mr. Speaker, on the very point that the gentleman from California 
just raised, I will submit a letter for the Record from the Small 
Business & Entrepreneurship Council, representing many small businesses 
and entrepreneurs around America and endorsing this legislation.
  I would also like to note that the Consumers Union of America and the 
Competitive Carriers Association, which are the small 
telecommunications companies that have to compete with the big 
behemoths, would both be concerned about their ability to compete in 
this very area; but they both support this legislation as well, the 
Consumers Union representing consumers and small businesses, and the 
SBE representing small businesses and entrepreneurs.

                                                  SBE Council,

                                    Vienna, VA, February 24, 2014.
     Hon. Bob Goodlatte,
     Chairman, Committee on the Judiciary, Washington, DC.
       Dear Chairman Goodlatte: The Small Business & 
     Entrepreneurship Council (SBE Council) is pleased to support 
     H.R. 1123, the Unlocking Consumer Choice and Wireless 
     Competition Act of 2013. Entrepreneurs require flexibility to 
     successfully run their businesses, and they certainly support 
     the freedom and choice provided by H.R. 1123.
       H.R. 1123 repeals a Library of Congress (LOC) rulemaking 
     determination regarding the circumvention of measures 
     controlling access to copyrighted software on wireless 
     telephone handsets for the purposes to connecting to other, 
     different wireless handsets. This means entrepreneurs and 
     small businesses can easily switch to another carrier once 
     their contracts expire on their cell phones or tablets.
       H.R. 1123 is a common sense measure that aligns government 
     policies with the flexibility the 100,000 members of SBE 
     Council need. We look forward to working with you to advance 
     H.R. 1123.
           Sincerely.
                                                   Karen Kerrigan,
     President and Chief Executive Officer.
                                  ____



                           National Fraternal Order of Police,

                                Washington, DC, February 24, 2014.
     Hon. Robert W. Goodlatte,
     Committee on the Judiciary, House of Representatives, 
         Washington, DC.
       Dear Mr. Chairman, I am writing on behalf of the members of 
     the Fraternal Order of Police to advise you of our support 
     for H.R. 1123, the ``Unlocking Consumer Choice and Wireless 
     Competition Act,'' which has been favorably reported by your 
     committee and is scheduled to be considered by the House 
     later this week.
       Law enforcement agencies across the country, and especially 
     in large urban areas, have been experiencing an increase in 
     the number of crimes that involve stolen wireless devices. 
     Often, smartphones are stolen from consumers and then sold to 
     the criminal

[[Page H1907]]

     equivalent of an aggregator who unlocks them in bulk and 
     attempts to sell them domestically or abroad. The ability to 
     unlock these devices is a critical part of criminals' ability 
     to resell them at a profit.
       For this reason, as Congress contemplates legislation to 
     facilitate lawful unlocking by individuals, either for 
     themselves or for devices on a family plan, we urge you to 
     retain the prohibition on bulk unlocking consistent with both 
     the 2010 and 2012 decisions from the Copyright Office. We 
     believe that maintaining this prohibition will reduce 
     smartphone thefts because the criminal sale of these devices 
     will no longer be as profitable.
       Thank you as always for considering the views of the more 
     than 330,000 members of the Fraternal Order of Police. If I 
     can provide any more information on this issue, please do not 
     hesitate to contact me or Executive Director Jim Pasco in my 
     Washington office.
           Sincerely,
                                                 Chuck Canterbury,
                                               National President.

  Mr. POLIS. I yield 3 minutes to the gentleman from Virginia (Mr. 
Scott).
  Mr. SCOTT of Virginia. I thank the gentleman for yielding.
  Mr. Speaker, the inability to unlock cell phones means that the 
original wireless carrier has an unfair and unnecessary competitive 
advantage. In many instances, the sole purpose of locking a cell phone 
is to keep consumers bound to their existing networks.
  Consumers often buy a new cell phone as part of their initial 
purchase of service from a carrier's wireless network. Because the 
phone is locked into that carrier's network, at the end of the first 
term of service, the consumer is forced to stay with that provider, 
sometimes at a higher rate, or being stuck with a useless locked phone.
  Allowing a phone to be unlocked will allow a consumer to keep his 
phone and switch carriers to a more appropriate, affordable, or 
suitable plan and have that opportunity, without having to purchase a 
new phone. So I support H.R. 1123, as amended, as it will restore a 
consumer's ability to unlock their cell phones.
  Now, obviously, allowing millions of consumers who wish to unlock 
their cell phones and switch to another provider, obviously, that has 
widespread support. The White House, the Federal Communications 
Commission, and others that the chairman of the committee have 
mentioned have all urged Congress to allow cell phone unlocking.
  The bill, as amended, makes improvements to the bill as reported by 
the Judiciary Committee. The new language in the bill makes it clear 
that the sole purpose of the bill is to allow unlocking in order to 
switch carriers.
  This bipartisan legislation enhances consumer choice in the cell 
phone market, and accordingly, I urge my colleagues to support the 
legislation.
  Mr. GOODLATTE. Mr. Speaker, at this time, it is my pleasure to yield 
2 minutes to the gentleman from Utah (Mr. Chaffetz), a member of the 
Judiciary Committee.
  Mr. CHAFFETZ. I thank the gentleman from Virginia, Chairman 
Goodlatte, for his leadership on this issue.
  We woke up one day, Mr. Speaker, and the Library of Congress--the 
Library of Congress--decided that, if you unlocked your cell phone, 
that that would be a felony--a felony.
  You go and buy a mobile phone. It is your phone. You own it. The 
current law on the books today, if you go to unlock that phone, you 
have committed a felony in the United States of America.
  You have got to be kidding me. It is a felony to unlock your cell 
phone?
  This bill today is short, sweet, and is simple. It is not a big, 
broad review of the DMCA. We are just trying to do something simple. We 
have an opportunity to make sure that that good person at home who 
wants to unlock their phone doesn't commit a felony. It is that short. 
It is that sweet. It is that simple.
  I stand with Representatives Lofgren, Polis, and others who want to 
look at this bigger, broader reform. But for today, could we please 
just make sure that it is not a felony to unlock your own phone? My 
goodness. We can do that. We can do that.
  I urge a ``yes'' vote on this bill. I appreciate the chairman's 
leadership. Let's get this done. Vote ``yes.''
  Mr. POLIS. Mr. Speaker, I yield myself such time as I may consume.
  In listening to the gentleman from California (Mr. Issa), there was a 
discussion of to what degree does this language interfere with 
potential and existing business models, and I agree with them. There 
are many workarounds. I think the danger here is invoking the language 
of copyright in an unrelated area.
  To quote from Public Knowledge: this new language, even if Congress 
believes that bulk unlocking is a problem, it is clear that it is not a 
copyright problem. Just as individual unlocking is not a copyright 
problem, a bill designed to scale back overreaching copyright laws 
should not also endorse an overreach of copyright law.
  I have a full statement from Public Knowledge that I will submit for 
the Record, Mr. Speaker. And as put by the Electronic Frontier 
Foundation, by expressly excluding bulk unlocking, this new legislation 
sends two dangerous signals: one, that Congress is okay with using 
copyright as an excuse to inhibit certain business models, even if the 
business isn't actually infringing on any of its copyrights; and, two, 
that Congress still doesn't understand the collateral damage section 
1201 is causing.
  For example, bulk unlocking not only benefits consumers, but it is 
also good for the environment. Unlocking allows reuse, and that means 
less electronic waste. I will be submitting the Electronic Frontier 
Foundation statement into the Record.
  Again, the bill, as it passed committee, didn't weigh in on these 
matters of bulk unlocking and was satisfactory to consumer advocacy 
groups, including those that have now come out in opposition to this 
underlying bill.
  Many of the arguments that the gentleman from Virginia (Mr. 
Goodlatte) made about the potential use of phones for criminal purposes 
may, in fact, be valid arguments and may, in fact, deserve policy 
responses, but not within the realm of copyright law.
  They deserve appropriate attention within the realm of criminal law 
and perhaps might prevail upon the expertise of both of my colleagues 
from Virginia, who know far more about these matters than I.
  But if there need to be harsher penalties or more enforcement within 
criminal law with regard to the illegal use of cell phones, whether 
locked or unlocked, or illicit transactions, that would be an 
appropriate venue.

                              {time}  1615

  But invoking copyright law is a very dangerous precedent for an 
unrelated area. We did reach a bipartisan consensus on this bill in 
July, but at the last minute after the bill was marked up and reported 
out, this new language was added to the bill that would have negative 
effects on consumers' ability to unlock their phones.
  The new language specifically states that the bill does not apply to 
bulk unlocking. Now, that signals that Congress believes that it is 
illegal for companies, including many small businesses and start-ups, 
to unlock cell phones in bulk, again, as Mr. Issa pointed out, not 
binding language, not something that immediately would be used to 
prosecute a small business, but it would create greater uncertainty--
not less uncertainty--around unlocking of cell phones in bulk, which 
could make it more difficult for consumers to buy an already unlocked, 
used cell phone. Again, since many consumers lack the technical 
expertise themselves to unlock cell phones, we want to ensure that they 
have availability to purchase unlocked cell phones and use them with 
the carrier of their choice.
  Again, this is an inappropriate use of copyright law to bar small 
businesses and large businesses from unlocking devices when it has 
nothing to do with making illegal copies of protected works, the 
purpose of copyright law. Again, if there is a criminal problem, we 
should address that within the realm of criminal law and enforcement, 
not within the realm of copyright.
  My colleague, Congresswoman Lofgren, offered compromise language to 
Chairman Goodlatte, but she reports back that this language was 
rejected because it was provided too late in the process. Again, I wish 
that Congresswoman Lofgren and others were brought in earlier in the 
process. I think there was the general assumption among the advocates 
on my side of the bill and that encourage more consumer choice that the 
bill, as reported

[[Page H1908]]

from committee, would be the bill that was considered on the floor, as 
is traditionally done.
  Unfortunately, we are not voting on that bill that had that 
bipartisan consensus in committee. The bill has changed, and the bill 
now can be perceived as picking sides with regard to congressional 
intent of application of copyright law for bulk unlocking, something 
that many of us see as a negative precedent with regard to consumer 
choice and overreach of using copyright law to protect incumbent 
advantages.
  But, Mr. Speaker, it is never too late to reach a compromise. There 
is no rush to bring this bill to the floor today. There is a temporary 
agreement in place which offers consumers the same protections that are 
considered under this bill, and I hope that the chair and ranking 
member consider working to improve this bill so that it can pass this 
body unanimously. It doesn't need to be a controversial bill.
  I fear that the bill currently before us, while, again, it enshrines 
some of the current protections that protect consumers that Mr. 
Chaffetz talked so passionately about, also, unfortunately, weighs in 
in applying copyright law in an unrelated area that can have the effect 
of restricting consumer choice.
  I reserve the balance of my time.

Rep. Goodlatte Slips Secret Change Into Phone Unlocking Bill That Opens 
                      the DMCA Up for Wider Abuse

                           (By Mike Masnick)

       As you may recall, there's been a ridiculous (on many 
     levels) fight concerning the legality of ``unlocking'' mobile 
     phones. Let's go through the history first. Because of 
     section 1201 of the DMCA, the ``anti-circumvention'' 
     provision, companies have been abusing copyright law to block 
     all sorts of actions that are totally unrelated to copyright. 
     That's because 1201 makes it illegal to circumvent basically 
     any ``technological protection measures.'' The intent of the 
     copyright maximalists was to use this section to stop people 
     from breaking DRM. However, other companies soon distorted 
     the language to argue that it could be used to block certain 
     actions totally unrelated to copyright law--such as unlocking 
     garage doors, ink jet cartridges, gaming accessories . . . 
     and phones. There have been court cases about a number of 
     these issues, with (thankfully) many courts ruling against 
     this kind of abuse, though it still happens.
       Separately, every three years, the Librarian of Congress 
     gets to announce ``exemptions'' to section 1201 where it 
     feels that things are being locked up that shouldn't be. Back 
     in 2006, one of these exemptions involved mobile phone 
     unlocking. Every three years this exemption was modified a 
     bit, but in 2012, for unexplained reasons, the Librarian of 
     Congress dropped that exemption entirely, meaning that 
     starting in late January of 2013, it was possible to 
     interpret the DMCA to mean that phone unlocking was illegal. 
     In response to this there was a major White House petition--
     which got over 100,000 signatures, leading the White House to 
     announce (just weeks later) that it thought unlocking should 
     be legal--though, oddly, it seemed to place the issue with 
     the FCC to fix, rather than recognizing the problem was with 
     current copyright law.
       Following this, a slew of new bills were introduced in 
     Congress, many of which attempted to narrowly deal with the 
     specific issue, while leaving the larger issues untouched. 
     Many of these bills were incredibly problematic, though 
     eventually the consensus seemed to get behind one bill before 
     . . . nothing. Fast forward a year and nothing has changed, 
     though the main bill, supported by Rep. Goodlatte, called the 
     Unlocking Consumer Choice Act, is scheduled to go to a vote 
     on Tuesday. It had gone through the basic markup process and 
     some adjustments had been made to make it a good first step 
     towards fixing problems.
       As of last week, a bunch of folks, who were concerned about 
     the issues with unlocking and how Section 1201 was a problem, 
     were supportive of this bill and were expecting to publicly 
     speak out in favor of getting the bill passed. Except . . . 
     late last week, with no explanation whatsoever, and no 
     consultation with others even though the markup and Judiciary 
     Committee process had already concluded, Rep. Goodlatte 
     slipped into the bill a little poison pill/favor to big phone 
     companies, adding a seemingly innocuous statement as section 
     (c)(2):
       No Bulk Unlocking--Nothing in this subsection shall be 
     construed to permit the unlocking of wireless handsets or 
     other wireless devices, for the purpose of bulk resale, or to 
     authorize the Librarian of Congress to authorize 
     circumvention for such purpose under this Act, title 17, 
     United States Code, or any other provision of law.
       While this gives Goodlatte and other maximalists some sort 
     of plausible deniability that this bill is making no 
     statement one way or the other on bulk unlocking, it 
     certainly very strongly implies that Congress believes bulk 
     unlocking is, in fact, still illegal. And that's massively 
     problematic on any number of levels, in part suggesting that 
     the unlocker's motives in unlocking has an impact on the 
     determination under Section 1201 as to whether or not it's 
     legal. And that's an entirely subjective distinction when a 
     bill seems to assume motives, which makes an already 
     problematic Section 1201 much more problematic. Without that 
     clause, this seemed like a bill that was making it clear that 
     you can't use the DMCA to interfere with an issue that is 
     clearly unrelated to copyright, such as phone unlocking. But 
     with this clause, it suggests that perhaps the DMCA's anti-
     circumvention clause can be used for entirely non-copyright 
     issues if someone doesn't like the ``motive'' behind the 
     unlocker.
       Given that, both Public Knowledge and EFF have pulled their 
     support for the bill. As Public Knowledge noted:
       ``The new language specifically excluding bulk unlocking 
     could indicate that the drafters believe that phone unlocking 
     has something to do with copyright law. This is not a 
     position we support. Even if Congress believes that bulk 
     unlocking is a problem, it's clear that it's not a copyright 
     problem, just as individual unlocking is not a copyright 
     problem. A bill designed to scale back overreaching copyright 
     laws should not also endorse an overreach of copyright law.''
       EFF made a similar statement:
       By expressly excluding [bulk unlocking], this new 
     legislation sends two dangerous signals: (1) that Congress is 
     OK with using copyright as an excuse to inhibit certain 
     business models, even if the business isn't actually 
     infringing anyone's copyright; and (2) that Congress still 
     doesn't understand the collateral damage Section 1201 is 
     causing. For example, bulk unlocking not only benefits 
     consumers, it's good for the environment--unlocking allows 
     re-use, and that means less electronic waste
       Two members of Congress who have been closely associated 
     with these issues, Reps. Zoe Lofgren and Anna Eshoo, also 
     pulled their support of the bill late Monday as well, 
     expressing their clear outrage at how this change was slipped 
     in after the fact, in a letter sent to their colleagues in 
     the House:
       After this bill was marked up and reported out of 
     committee, a new section was added to the bill without notice 
     to or consultation with us. . . .
       They furthermore point out that it's ridiculous that 
     Congress is not fixing the broken anti-circumvention parts of 
     the DMCA, and could possibly be strengthening them with this 
     sneaky change of language:
       In his concurring opinion in Lexmark v. Static Control 
     Components, Judge Merritt wrote: ``We should make clear that 
     in the future companies like Lexmark cannot use the DMCA in 
     conjunction with copyright law to create monopolies of 
     manufactured goods for themselves . . .'' The court's holding 
     prevented Lexmark from using dubious copyright claims and an 
     overboard reading of 17 USC 1201--the same section the 
     Unlocking Consumer Choice Act alters--to prevent third 
     parties from creating competing printer ink cartridges. The 
     issue is similar here.
                                  ____


      Unlocking To Get a Vote in Congress, but the Bill Is Flawed

                          (By Troy Wolverton)

       Congress on Tuesday is expected to take up the issue of 
     cell phone unlocking. But what started out as an effort to 
     restore consumer rights may end up being a setback to 
     consumers.
       While consumers may soon be able to legally unlock their 
     cell phones again, the bill that would temporarily restore 
     that right would essentially prohibit companies from making a 
     business doing the same thing. In other words, while you 
     could legally unlock your own cell phone--if you can figure 
     out how to do it--you might have a difficult time buying an 
     already unlocked used cell phone--because few of them would 
     be on the market.
       That wasn't how the bill, H.R. 1123, was originally written 
     or what it stated when it was voted out of committee. 
     Instead, the bill simply would have set aside for the next 
     year or so a regulatory ruling from last year and allowed 
     anyone--consumer or business--to unlock cell phones 
     individually or in bulk.
       But late last week, new language barring bulk unlocking was 
     added surreptitiously to the bill. Although the new language 
     wasn't subject to any hearings or public debate, it's 
     included in the bill that will be voted on by Congress. 
     What's worse is that the bill will apparently be voted on 
     using a special procedure that would essentially bar both 
     debate on the floor of the House and amendments to the bill.
       The change to the bill was so substantial that Derek 
     Khanna, a former Republican congressional staffer who started 
     the campaign to reverse the regulatory ruling on unlocking 
     and has worked for the past year to keep the issue alive, has 
     become lukewarm on the bill, calling the new language 
     ``troublesome.'' While he's still backing the bill, Khanna 
     expressed hope that the Senate, when considering the issue, 
     would work on a bill without the bulk unlocking ban.
       Other former backers have now dropped their support for the 
     unlocking bill. Among them: the Electronic Frontier 
     Foundation, consumer advocacy group Public Knowledge and 
     local Democratic representatives Anna Eshoo and Zoe Lofgren.
       ``We're all for phone freedom and we wish we could support 
     the bill. Unfortunately, however, the costs for users 
     outweigh the benefits,'' the EFF said in statement.
       Cell phone manufacturers and carriers frequently use 
     software to bind or lock devices

[[Page H1909]]

     to particular networks. The locks are meant to make it 
     difficult for consumers to take their devices with them to 
     another carrier. Manufacturers and carriers say the locks are 
     important to their businesses, allowing them to develop 
     exclusive devices that can attract or retain consumers. 
     Consumer advocates, meanwhile, basically view them as tools 
     that thwart competition in the marketplace and prevent 
     consumers from being able to fully control the devices they 
     own.
       The locks are protected by an obscure portion of U.S. 
     copyright law that forbids consumers and businesses from 
     tampering with protections put in place by intellectual 
     property owners to protect their works--even when what they 
     want to do with those works is completely legal or covered by 
     fair use.
       The Librarian of Congress is charged with reviewing, every 
     three years, potential exemptions to that copyright 
     provision. Starting in 2006, the Librarian recognized an 
     exception for cell phone unlocking.
       But in late 2012, the Librarian, citing the growing number 
     of unlocked devices on the market, announced that the 
     exemption would be revoked. Early last year, unlocking cell 
     phones again became illegal.
       Ever since, consumers and their advocates have pressed 
     policy makers to overturn the Librarian's ruling. A petition 
     to President Obama last year, for example, received more than 
     114,000 signatures in a little more than a month.
       At its base, the dispute over unlocking is about whether 
     copyright law can be twisted to forbid otherwise legal 
     activities. The copyright provision that prohibits the 
     breaking of software locks was written as the age of digital 
     information was just starting to take off. One of the 
     features of digital information is that computers can be used 
     to make perfect copies of originals. There was a real fear on 
     the part of copyright holders that the market for their goods 
     would be undermined by a flood of perfect digital copies of 
     their works. Why buy a song from Apple if you can simply 
     download the same one for free from Napster? The provision 
     was written to allow copyright holders to protect their works 
     from this kind of illicit mass copying.
       But since then, the provision has been used to thwart all 
     kinds of otherwise legitimate activities. Not only has the 
     unlocking of cell phones been impeded by the provision, but 
     so too have things like the ``jailbreaking'' of iPads so that 
     they can run programs not approved by Apple, the making of 
     printer cartridges by companies other than the printer 
     manufacturer, and reporting on security vulnerabilities.
       Advocates for a renewed right of unlocking generally oppose 
     this kind of restrictive view of copyright. They'd like 
     Congress or regulators to recognize that, in general, 
     breaking software locks is OK if the intention is to do 
     something legal, something that might be covered under fair 
     use or other consumer rights.
       What those advocates find objectionable about the bulk 
     unlocking bar in the new bill is that it represents something 
     of a Congressional imprimatur for the more restrictive view 
     of copyright, one in which copyright law can be used to ban 
     business practices that have nothing to do with making 
     illicit copies of protected works.
       As Eshoo and Lofgren put it in a joint statement today: 
     ``Congress should work to roll back abusive practices that 
     use copyright law to prevent owners from having control over 
     the devices they lawfully own. What it means to `own' a 
     device that has been purchased is what's at stake here. The 
     new addition to the bill puts the effort to stand up for the 
     property rights of the owners of technology devices at 
     risk.''
       Eshoo, Lofgren and other backers of unlocking have put 
     their hope in a broader bill co-authored by the two that 
     would grant a permanent right for consumers and businesses to 
     unlock phones, but to circumvent software locks if the intent 
     is to do something non-infringing.
       As I wrote in my column today, I think that bill is a long 
     shot, given the current dysfunction of Congress. Instead, I 
     argued that the Federal Communications Commission should 
     simply step in now and bar the locking of cell phones to 
     particular carriers.
                                  ____


                [From washingtonpost.com, Feb. 21, 2014]

Here's What Reformers Say Is Missing From Congress Cellphone Unlocking 
                                  Bill

                          (By Timothy B. Lee)

       Almost everyone agrees that unlocking your cellphone should 
     be legal. But crafting legislation to give consumers the 
     freedom everyone agrees they should have is surprisingly 
     difficult.
       The debate over cellphone unlocking started about a year 
     ago, when a ruling by the Library of Congress suggested that 
     unlocking your cellphone to take it to another wireless 
     carrier could run afoul of copyright law. That triggered a 
     grassroots backlash, prompting members of Congress and even 
     the White House to support overruling the Librarian's ruling.
       But crafting legislation to permit cellphone unlocking has 
     been surprisingly complicated. Rep. Bob Goodlatte (R-Va.), 
     the chairman of the House Judiciary Committee, has introduced 
     legislation permitting consumers to unlock their cellphones. 
     But that legislation has gotten lukewarm support from public 
     interest groups who say it doesn't go far enough in 
     recognizing consumer rights.
       On Friday, the advocacy group Public Knowledge announced it 
     was withdrawing support from Goodlatte's bill after the 
     chairman introduced a new version. The new version includes 
     language permitting individuals to unlock their cellphones. 
     But the legislation states that ``nothing in this subsection 
     shall be construed to permit the unlocking of wireless 
     handsets or other wireless devices, for the purpose of bulk 
     resale.''
       The problem, according to Public Knowledge's Sherwin Siy, 
     is that the DMCA shouldn't apply to phone unlocking--``bulk'' 
     or otherwise--in the first place. The DMCA was supposed to be 
     about preventing piracy, not limiting what consumers do with 
     their gadgets. The new Goodlatte bill ``doesn't prevent bulk 
     unlocking but it certainly seems to suggest Congress thinks 
     it's already prohibited,'' Siy says. That could be a step 
     backwards.
       The issue has significance well beyond cellphones. More and 
     more of the products in our daily lives have computers 
     embedded in them. If it's illegal to unlock your cellphone, 
     it might be illegal to modify or repair a wide variety of 
     other products. For example, all modern cars have computers 
     embedded in them, and repairing a car increasingly requires 
     accessing its onboard software. Could car manufacturers 
     invoke the DMCA to prevent unauthorized repair work?
       An aide to the judiciary committee insists that critics 
     like Siy are over-reading the legislation. The bill is 
     intended to allow cellphone unlocking, the aide says, without 
     affecting broader questions about the scope of the DMCA. 
     Those broader issues will be tackled later, as part of a 
     broader review of U.S. copyright law.
       But the current furor over cellphone unlocking represents a 
     rare opportunity to craft DMCA reform that could actually 
     pass Congress. If Congress passes narrow legislation fixing 
     only the most obvious abuse of the DMCA, there might not be 
     enough political capital left for a broader reform later on.
       The Electronic Frontier Foundation, another public interest 
     group that favors overhauling the DMCA, shares Siy's concern. 
     ``We are deeply concerned that the bill has new language 
     excluding bulk unlocking,'' EFF's Corynne McSherry says. 
     ``Unlocking, whether individually or in bulk, makes reuse and 
     repair possible, and is a public benefit. It should be 
     clearly lawful.''

  Mr. GOODLATTE. Mr. Speaker, I yield myself 1 minute to say to the 
gentleman from Colorado, I understand that you would like to see 
copyright law changed. But the fact of the matter is this is copyright 
law, and so the fact of the matter is right now consumers cannot 
legally unlock their phones, and we need to fix that problem. We have 
been working to do it.
  I have worked very closely with the ranking member of the full 
committee and the ranking member of the subcommittee on the Judiciary 
Committee so that this change that was made is bipartisan. It should 
come as a surprise to no one because we, in fact, discussed this during 
the markup of the bill in the committee. When we did discuss that, we 
said we would continue to work with Members moving forward, and we came 
up with language that is bipartisan.
  It is also supported, by the way, by Senator Leahy and Senator 
Grassley in the United States Senate. This is a bipartisan and 
bicameral compromise to move this legislation forward to address the 
concerns of organizations like the American Consumers Union supporting 
this legislation, the Small Business & Entrepreneurship Council, the 
Competitive Carriers Association, the CTIA, and also, importantly----
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. GOODLATTE. I yield myself an additional 30 seconds. I will read 
very briefly from the letter from the National Fraternal Order of 
Police.
  It says: ``As Congress contemplates legislation to facilitate lawful 
unlocking by individuals, either for themselves or for devices on a 
family plan, we urge you to retain the prohibition on bulk unlocking 
consistent with both the 2010 and 2012 decisions from the Copyright 
Office. We believe that maintaining this prohibition will reduce 
smartphone thefts because the criminal sale of these devices will no 
longer be as profitable.''
  I reserve the balance of my time.
  Mr. POLIS. Mr. Speaker, I would like to yield 2 minutes to the 
gentleman from Virginia (Mr. Scott) for purposes of a colloquy.
  Mr. SCOTT of Virginia. Mr. Speaker, I would like to engage the 
chairman in a colloquy.
  Mr. Chairman, am I correct that this legislation is meant to preserve 
the Registrar of Copyrights' findings on bulk resale of new phones in 
both the 2010 and 2012 rulemakings and is not intended to apply to used 
phones?
  Mr. GOODLATTE. Will the gentleman yield?
  Mr. SCOTT of Virginia. I yield to the gentleman from Virginia.

[[Page H1910]]

  Mr. GOODLATTE. That is correct. This legislation is not intended to 
impair unlocking related to family plans consisting of a small number 
of handsets or of used phones by legitimate recyclers or resellers. The 
objective of this savings clause is to make it clear that the 
legislation does not cover those engaged in subsidy arbitrage or in 
attempting to use the unlocking process to further traffic in stolen 
devices.
  Mr. SCOTT of Virginia. Thank you, Mr. Chairman.
  Also, I think you have indicated that the Fraternal Order of Police 
is supportive of this provision as well?
  Mr. GOODLATTE. That is correct.
  Mr. Speaker, at this time, it is my pleasure to yield 2 minutes to 
the gentleman from Georgia (Mr. Collins), a member of the Judiciary 
Committee.
  Mr. COLLINS of Georgia. Thank you, Mr. Chairman.
  Mr. Speaker, again, as we come here to talk about this, I join and 
associate myself with the gentleman from Utah and also the other 
comments that have been made here. We are looking to protect consumers. 
I enjoy the opportunity to go forward and look at an issue which we are 
supportive of: consumer choice.
  As a member of the Judiciary Committee's IP Subcommittee, I believe 
if a consumer has met their contractual obligations with a service 
provider, then they should have the right to unlock and use the device 
with another carrier.
  Our Nation's intellectual property law should prioritize three 
things: innovation, creation, and competition. Frankly, holding 
consumers hostage to their carrier fails to pass the smell test in this 
category.
  We live in an age where consumers want choice, access, and freedom. 
Although carriers may have to evolve and develop to address the changes 
that this legislation may have on their business models, I am confident 
that any changes made will only better serve the consumer and promote 
competition.
  It is with that in mind that I understand the gentleman from 
Colorado, and I understand the thought, because I actually had passed 
and do support the larger measure that came out of the Judiciary 
Committee. But also, in taking into account, there is a process here in 
which I believe that immediate help to consumers is the bigger issue 
and would be willing and will work, as I have stated before, for the 
larger measures that have been talked about here before. However, to 
hold this bill as it is and say this is not something to move forward 
on I can't accept and would urge all Members to accept this bill. It is 
a process of moving forward.
  I do not believe that there is picking sides here. In fact, what I 
believe is happening here is we are protecting consumers and moving the 
discussion down the line. That is what we are sent here to do, and I 
believe this is a good balance between the two.
  I respect the gentleman from Colorado and, Mr. Speaker, believe that 
we can work further on this, but this is a bill that needs to be passed 
today so we can move on and protect our consumers.
  Mr. Chairman, I appreciate your work and the work of the committee in 
doing so. This is a matter of consumers, this is a matter of choice, 
and we need to make sure that this body stands for that.
  Mr. POLIS. I would like to inquire, Mr. Speaker, as to how much time 
remains on both sides?
  The SPEAKER pro tempore. The gentleman from Colorado has 7\1/2\ 
minutes remaining. The gentleman from Virginia has 8 minutes remaining.
  Mr. POLIS. I yield myself such time as I may consume.
  Again, there seems to be some strong, bipartisan consensus here that 
there remains more work to be done. As Representative Chaffetz said, we 
do need a long-term solution. We need to ensure that any solution we 
enter is not compromised by our Nation's trade agreements to ensure 
that consumers are protected in control of their own devices in 
choosing the plan that they desire.

  The language in question that was added after the bipartisan 
consensus was reached in committee is not operative language. It is not 
language that criminalizes something that wasn't criminal before or 
proactively bans the bulk sale of phones. What it does explicitly do is 
establish some degree of congressional intent.
  Perhaps this colloquy between the two gentlemen from Virginia helped 
roll back a part of what could be read in the congressional intent of 
this language, and I am appreciative of that effort. However, 
congressional intent could, nevertheless, be construed that there is an 
imprint, there is a congressional desire to use a more restrictive view 
of copyright, one in which copyright laws can be used to ban business 
practices that have nothing to do with making illicit copies of 
protected works.
  Copyrights are a very important area of law. It is meant to protect 
the creator of a work from having their work ripped off and sold and 
others profit at their expense. However, it is difficult to see, and 
this is why so many of us were critical of the Librarian of Congress' 
initial decision. It is very difficult to see what the nexus is between 
unlocking cell phones and copyright.
  By adding this language in, it adds some degree of congressional 
perception that copyright law can be what many of us feel to be abused 
in this manner that reduces consumer choice and does not protect any 
legitimate creator of a work. Again, to the extent there are concerns 
from police and law enforcement officials with regard to how unlocked 
or locked cell phones are being used for transactions that are 
otherwise illegal, that is a question of criminal law and enforcement 
and something that I would hope to be certainly supportive of efforts 
within Judiciary or Homeland Security or other committees to ensure 
that we reduce crime across all of those. But let's not give the 
court's ruling on these actions a reason to think that perhaps Congress 
condones them.
  Again, having my colleagues on both sides of the aisle on the Record 
talking about how this bill is simply a first step and how we need to 
go further and, of course, not backing away from the initial committee 
markup of the bill, it is certainly also helpful in establishing 
congressional intent. And that is really what we are talking about 
here. We are not talking about binding language where before this bill 
passes somebody doesn't go to jail, after this bill passes they do. We 
are talking about potential use and precedent going forward with regard 
to how copyright law can, from my perception, be misapplied to reduce 
consumer choice in areas that are unrelated to the purpose of copyright 
protection.
  That is why I continue to stand in opposition to this bill, certainly 
appreciating the step forward of enshrining in law potentially that it 
is no criminal penalty for an individual unlocking their own cell 
phone. But, again, we want to make sure it doesn't happen at the 
expense of moving the entire discussion in the wrong direction.
  An opinion in yesterday's L.A. Times was headlined, ``The House's 
cell phone unlocking bill: Thanks but no thanks.'' I would like to 
submit the L.A. Times op-ed into the Record, Mr. Speaker.
  I reserve the balance of my time.

              [From the Los Angeles Times, Feb. 25, 2014]

       The House's Cellphone Unlocking Bill: Thanks But No Thanks

                            (By Jon Healey)

       How hard can it be for Congress to make it legal for 
     consumers to switch mobile networks without having to buy a 
     new phone?
       Too hard, evidently.
       The House is scheduled to vote Tuesday on a bill that was 
     supposed to clear the way for consumers to unlock the phones 
     they buy from wireless companies after they've fulfilled 
     their contracts. But the measure, which was modest to begin 
     with, has been rendered irrelevant by voluntary agreements on 
     unlocking that the Federal Communications Commission obtained 
     from the wireless companies. The bill was also changed at the 
     last minute in a way that arguably weakens consumers' 
     ownership rights, prompting some consumer advocates and 
     Democrats to withdraw their support.
       The current version is so bad, consumers would be better 
     off if Congress did nothing at all.
       At issue is a dubious interpretation of copyright law that 
     deters people from moving their phones from one network to 
     another. Each mobile carrier typically sells phones with 
     electronic locks that prevent them from being reprogrammed to 
     work on rival carriers' networks. The U.S. Copyright Office, 
     acting through the Librarian of Congress, ruled in 2012 that 
     removing the locks violated the 1998 Digital Millennium 
     Copyright Act, which forbids the circumvention of 
     technologies that protect copyrighted works.
       The ruling was bizarre, considering that the locks inside 
     phones don't protect against

[[Page H1911]]

     software piracy; their only real purpose is to protect the 
     mobile carriers' business model. And the carriers have (and 
     use) better tools to recover the subsidies they put into the 
     phones they sell, most notably contracts that impose hefty 
     early termination penalties.
       The 1998 law requires the Librarian of Congress to revisit 
     the anti-circumvention rules every three years, which means 
     the Electronic Frontier Foundation and other consumer 
     advocates can try to set things right in 2015. Sadly, 
     however, the default interpretation of the cellphone locks is 
     that they are covered by the anti-circumvention ban.
       The Copyright Office's decision, which took effect early 
     last year, led more than 100,000 people to petition the White 
     House for help. Tech-friendly lawmakers lined up to offer 
     bills, including an elegantly simple one by Sen. Amy 
     Klobuchar (D-Wis.) that would require mobile companies to let 
     customers unlock the wireless devices they buy, and a more 
     sweeping proposal by Sen. Ron Wyden (D-Ore.) to exempt 
     wireless device unlocking from the anti-circumvention ban.
       The best of the bunch was a bill by Rep. Zoe Lofgren (D-San 
     Jose) and a bipartisan group of co-sponsors to limit the 1998 
     law's anti-circumvention rules to locks that protect against 
     piracy. That bill also would have declared that it was not 
     copyright infringement for the owner of a mobile device to 
     unlock it for the purpose of switching to another network.
       The House, however, is scheduled to take up a different 
     measure Tuesday afternoon, H.R. 1123 by Judiciary Committee 
     Chairman Bob Goodlatte (R-Va.) and co-sponsors from both 
     parties. As introduced, it would simply have replaced the 
     Copyright Office's 2012 ruling with its decision in 2010 that 
     cellphone owners could unlock their phones without running 
     afoul of copyrights. It also would have called on the 
     Librarian of Congress to decide within a year whether to 
     extend the exemption to all other locked wireless devices, 
     such as tablets.
       The relief offered by the bill would have remained in 
     effect only until the Librarian of Congress reviewed the 
     anti-circumvention rules again in 2015, so it hardly seemed 
     worth the effort. The version that the House is slated to 
     vote on Tuesday also includes a new provision effectively 
     barring devices from being unlocked in bulk for the purpose 
     of reselling them.
       The latter change disturbed Lofgren (a member of 
     Goodlatte's committee) and fellow Silicon Valley Democrat 
     Anna Eshoo, who accused Republicans of adding the provision 
     in secret after the Judiciary Committee approved the bill. 
     The proposed ban on unlocking for the sake of resale, they 
     argued in a letter to colleagues Monday, is an inappropriate 
     use of copyright law to stop people from disposing of the 
     devices they buy as they please.
       ``Congress should work to roll back abusive practices that 
     use copyright law to prevent owners from having control over 
     the devices they lawfully own,'' Lofgren and Eshoo wrote. 
     ``What it means to 'own' a device that has been purchased is 
     what's at stake here. The new addition to the bill puts the 
     effort to stand up for the property rights of the owners of 
     technology devices at risk.''
       Public Knowledge, a technology advocacy group, agreed. 
     ``Even if Congress believes that bulk unlocking is a problem, 
     it's clear that it's not a copyright problem, just as 
     individual unlocking is not a copyright problem,'' said 
     Sherwin Siy, the group's vice president of legal affairs. ``A 
     bill designed to scale back overreaching copyright laws 
     should not also endorse an overreach of copyright law.''
       Both Public Knowledge and the Electronic Frontier 
     Foundation withdrew their support for the measure after the 
     new provision was disclosed last week.
       The House plans to bring up HR 1123 under an expedited 
     procedure that forbids amendments but requires a two-thirds 
     vote to pass. With some luck, Lofgren and Eshoo can rally all 
     the supposedly tech-friendly members in the chamber to knock 
     the bill off track.
       As you may recall, there's been a ridiculous (on many 
     levels) fight concerning the legality of ``unlocking'' mobile 
     phones. Let's go through the history first. Because of 
     section 1201 of the DMCA, the ``anti-circumvention'' 
     provision, companies have been abusing copyright law to block 
     all sorts of actions that are totally unrelated to copyright. 
     That's because 1201 makes it illegal to circumvent basically 
     any ``technological protection measures.'' The intent of the 
     copyright maximalists was to use this section to stop people 
     from breaking DRM. However, other companies soon distorted 
     the language to argue that it could be used to block certain 
     actions totally unrelated to copyright law--such as unlocking 
     garage doors, ink jet cartridges, gaming accessories . . . 
     and phones. There have been court cases about a number of 
     these issues, with (thankfully) many courts ruling against 
     this kind of abuse, though it still happens.
       Separately, every three years, the Librarian of Congress 
     gets to announce ``exemptions'' to section 1201 where it 
     feels that things are being locked up that shouldn't be. Back 
     in 2006, one of these exemptions involved mobile phone 
     unlocking. Every three years this exemption was modified a 
     bit, but in 2012, for unexplained reasons, the Librarian of 
     Congress dropped that exemption entirely, meaning that 
     starting in late January of 2013, it was possible to 
     interpret the DMCA to mean that phone unlocking was illegal. 
     In response to this there was a major White House petition--
     which got over 100,000 signatures, leading the White House to 
     announce (just weeks later) that it thought unlocking should 
     be legal--though, oddly, it seemed to place the issue with 
     the FCC to fix, rather than recognizing the problem was with 
     current copyright law.
       Following this, a slew of new bills were introduced in 
     Congress, many of which attempted to narrowly deal with the 
     specific issue, while leaving the larger issues untouched. 
     Many of these bills were incredibly problematic, though 
     eventually the consensus seemed to get behind one bill 
     before... nothing. Fast forward a year and nothing has 
     changed, though the main bill, supported by Rep. Goodlatte, 
     called the Unlocking Consumer Choice Act, is scheduled to go 
     to a vote on Tuesday. It had gone through the basic markup 
     process and some adjustments had been made to make it a good 
     first step towards fixing problems.
       As of last week, a bunch of folks, who were concerned about 
     the issues with unlocking and how Section 1201 was a problem, 
     were supportive of this bill and were expecting to publicly 
     speak out in favor of getting the bill passed. Except... late 
     last week, with no explanation whatsoever, and no 
     consultation with others even though the markup and Judiciary 
     Committee process had already concluded, Rep. Goodlatte 
     slipped into the bill a little poison pill/favor to big phone 
     companies, adding a seemingly innocuous statement as section 
     (c)(2):
       No Bulk Unlocking--Nothing in this subsection shall be 
     construed to permit the unlocking of wireless handsets or 
     other wireless devices, for the purpose of bulk resale, or to 
     authorize the Librarian of Congress to authorize 
     circumvention for such purpose under this Act, title 17, 
     United States Code, or any other provision of law.
       While this gives Goodlatte and other maximalists some sort 
     of plausible deniability that this bill is making no 
     statement one way or the other on bulk unlocking, it 
     certainly very strongly implies that Congress believes bulk 
     unlocking is, in fact, still illegal. And that's massively 
     problematic on any number of levels, in part suggesting that 
     the unlocker's motives in unlocking has an impact on the 
     determination under Section 1201 as to whether or not it's 
     legal. And that's an entirely subjective distinction when a 
     bill seems to assume motives, which makes an already 
     problematic Section 1201 much more problematic. Without that 
     clause, this seemed like a bill that was making it clear that 
     you can't use the DMCA to interfere with an issue that is 
     clearly unrelated to copyright, such as phone unlocking. But 
     with this clause, it suggests that perhaps the DMCA's anti-
     circumvention clause can be used for entirely non-copyright 
     issues if someone doesn't like the ``motive'' behind the 
     unlocker.
       Given that, both Public Knowledge and EFF have pulled their 
     support for the bill. As Public Knowledge noted:
       ``The new language specifically excluding bulk unlocking 
     could indicate that the drafters believe that phone unlocking 
     has something to do with copyright law. This is not a 
     position we support. Even if Congress believes that bulk 
     unlocking is a problem, it's clear that it's not a copyright 
     problem, just as individual unlocking is not a copyright 
     problem. A bill designed to scale back overreaching copyright 
     laws should not also endorse an overreach of copyright law.''
       EFF made a similar statement:
       By expressly excluding [bulk unlocking], this new 
     legislation sends two dangerous signals: (1) that Congress is 
     OK with using copyright as an excuse to inhibit certain 
     business models, even if the business isn't actually 
     infringing anyone's copyright; and (2) that Congress still 
     doesn't understand the collateral damage Section 1201 is 
     causing. For example, bulk unlocking not only benefits 
     consumers, it's good for the environment--unlocking allows 
     re-use, and that means less electronic waste
       Two members of Congress who have been closely associated 
     with these issues, Reps. Zoe Lofgren and Anna Eshoo, also 
     pulled their support of the bill late Monday as well, 
     expressing their clear outrage at how this change was slipped 
     in after the fact, in a letter sent to their colleagues in 
     the House:
       After this bill was marked up and reported out of 
     committee, a new section was added to the bill without notice 
     to or consultation with us. . . .
       They furthermore point out that it's ridiculous that 
     Congress is not fixing the broken anti-circumvention parts of 
     the DMCA, and could possibly be strengthening them with this 
     sneaky change of language:
       In his concurring opinion in Lexmark v. Static Control 
     Components, Judge Merritt wrote: ``We should make clear that 
     in the future companies like Lexmark cannot use the DMCA in 
     conjunction with copyright law to create monopolies of 
     manufactured goods for themselves . . .'' The court's holding 
     prevented Lexmark from using dubious copyright claims and an 
     overboard reading of 17 USC 1201--the same section the 
     Unlocking Consumer Choice Act alters--to prevent third 
     parties from creating competing printer ink cartridges. The 
     issue is similar here.
       Congress should work to roll back abusive practices that 
     use copyright law to prevent owners from having control over 
     the devices they lawfully own. What it means to ``own'' a 
     device that has been purchased is what's at stake here. The 
     new addition to the bill puts the effort to stand up for the 
     property rights of the owners of technology devices at risk.
       It is sad that the bipartisan consensus reached during 
     mark-up in the Judiciary

[[Page H1912]]

     committee to improve the law has been destroyed by a secret 
     decision of the majority after the bill was reported out.
       Unfortunately, the bill was deemed so uncontroversial that 
     it's been listed on the suspension calendar of the House, 
     which is where non-controversial bills are put to ensure 
     quick passage. That means that, not only did Goodlatte slip 
     in a significant change to this bill that impacts the entire 
     meaning and intent of the bill long after it went through the 
     committee process (and without informing anyone about it), 
     but he also got it put on the list of non-controversial bills 
     to try to have it slip through without anyone even noticing.
       Either way, it seems that even if the bill does pass, it 
     won't do anything to fix a very broken part of the DMCA and, 
     in fact, could make it somewhat worse. Politics as usual when 
     it comes to anything having to do with copyright.

  Mr. GOODLATTE. Mr. Speaker, I am the last speaker remaining on our 
side. I believe I have the right to close, so if the gentleman has 
anything else he would like to say.
  Mr. POLIS. Mr. Speaker, I am prepared to close, and I yield myself 
the balance of my time.
  I am heartened by the discussion on both sides of the aisle with 
regard to the path forward. I wish we could be at a better place today. 
I think we had a bill that was reported out of committee that would not 
have engendered, I don't believe, any degree of controversy here on the 
floor of the House.
  We have now moved to a place where the bill does invoke some degree 
of appropriate controversy and some degree of appropriate opposition. I 
would advance that it is never too late to reach a compromise, either 
before this bill is voted upon--perhaps my colleague, Mr. Goodlatte, 
will be willing to consider Ms. Lofgren's language change--or after 
this bill passes. I think that we would all agree that this issue is 
not one in any way, shape, or form that is being put to bed here today.
  I would hope that, as a guiding principle, Members on both sides of 
the aisle look to consumer choice and the power of markets to achieve 
the best outcome and ensure that incumbents don't seek to co-opt 
copyright law to the detriment of our economy and the detriment of 
consumer choice.

                              {time}  1630

  Again, this bill has language that can be construed as applying 
copyright law in another area and having a congressional blessing to do 
so, which is why I encourage my colleagues to join Electronic Frontier 
Foundation, Public Knowledge, Generation Opportunity, FreedomWorks, and 
iFixit, and some of those very organizations that were in the forefront 
of proposing that we pass a bill that allows unlocking that have since 
withdrawn their support from this bill because of the last-minute 
changes, which I saw for the first time yesterday and that I wish this 
House had a bigger opportunity to vet, perhaps bringing this bill 
forward under a rule if the suspension motion fails.
  If a third of the Members of the House oppose, we would have an 
opportunity to remedy this bill under a rule that was hopefully 
structured to allow for compromise language that would then allow the 
bill to proceed with near unanimity. I hope my colleagues on both sides 
of the aisle see that as an opportunity, certainly not as a rebuke to 
the chair and ranking member on the committee. We appreciate the 
direction and the intent behind this bill, their desire to make sure 
that Americans know that they are not under duress or a criminal threat 
if they are unlocking their own cell phone. That is a sentiment that 
both the chair and the ranking member have echoed passionately, but I 
think we can do better with regard to ensuring that this bill is also 
not a precedent for the use of overreaching copyright law and a 
congressional blessing to do so in a way that hampers the trade, the 
bulk trade of unlocked cell phones which offer great potential benefits 
to the marketplace and to consumers.
  So I urge my colleagues to vote ``no'' on this suspension bill, to 
consider working with both sides to get to ``yes,'' and to move in a 
direction that we look at as a guiding principle, ensuring that 
consumers and the marketplace are allowed to fully operate without the 
co-option of copyright law to protect incumbents.
  I yield back the balance of my time.
  Mr. GOODLATTE. Mr. Speaker, I yield myself the balance of my time.
  I would just say to the gentleman from Colorado, I understand his 
larger aspirations with regard to changes in copyright law. The 
committee recognizes that our copyright laws have not been amended in 
40 years, and that we are conducting a comprehensive review. We have 
held many hearings on copyright issues already. We have many more 
planned, and we are going to continue that work, but this small bill to 
protect the rights of consumers on cell phone unlocking does not meet 
his aspirations to try to use it as a vehicle for greater things being 
done here because it is intended to be a narrow fix to a problem that 
was created when the Register of Copyrights did not take the necessary 
steps to allow the continued unlocking of cell phones.
  So it has taken a great deal of bipartisan work on the part of the 
ranking member and myself; the ranking member of the subcommittee, who 
had objections to the bill as reported out of the committee, has since 
left Congress, and the new ranking member has signed off on the change 
that was made here to bring organizations like the Fraternal Order of 
Police into acceptance of this, and we still have the support of 
important consumer organizations, like Consumers Union, as well as the 
cell phone industry organizations. As a result, this legislation needs 
to move forward as it is today.
  The savings clause that the gentleman objects to is meant to make it 
clear that this is focused on consumers and not on the larger issues. 
If enacting in one area as we are in this very narrow, targeted bill, 
we sent a signal in another area, and a signal is what the gentleman 
identifies, we would never enact anything. So it is important that we 
address what is in this bill, the language that was worked out in the 
committee, that was discussed in the committee, that was then worked 
out further as the bill was reported to the floor, and pass this 
legislation today, and we can work on these broader issues in the 
future, but in the meantime, we need to protect the rights of our 
consumers to unlock the phones that they own when they purchase a used 
cell phone.
  Ms. LOFGREN. Will the gentleman yield?
  Mr. GOODLATTE. I am happy to yield briefly to the gentlewoman.
  Ms. LOFGREN. I appreciate the gentleman yielding. I was delayed at 
the airport. I just wanted to indicate my opposition to the bill since 
it has been changed, noting that Public Knowledge in the Los Angeles 
Times said today that we would be better off doing nothing than the 
bill as changed. I have talked to the chairman about this, but I wanted 
to make my position clear. If we do not pass this bill because of the 
Obama administration's deal with the telecoms, consumers will still be 
able to unlock their phones. This is a step backwards.
  I very much appreciate the gentleman's courtesy in yielding.
  Mr. GOODLATTE. Reclaiming my time, what the gentlewoman says is, 
indeed, true; that there is a private agreement, but that private 
agreement cannot and does not mitigate the fact that the act of 
unlocking a cell phone carries with it a felony penalty under the law, 
and that is absolutely ridiculous. So this legislation needs to be 
passed, and we can then move on to have the larger debate about the 
importance of cell phone unlocking--or rather, section 1201 of the 
DMCA, and other issues as we move forward on various copyright issues 
in the committee, but now is not the place, now is not the time to have 
that debate.
  This simple, bipartisan legislation should be passed by the House. I 
urge my colleagues to support the legislation.
  I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Virginia (Mr. Goodlatte) that the House suspend the 
rules and pass the bill, H.R. 1123, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. POLIS. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this motion will be postponed.

[[Page H1913]]



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