[Congressional Record (Bound Edition), Volume 150 (2004), Part 10]
[Senate]
[Pages 13435-13446]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. KYL:
  S. 2555. A bill to authorize the use of judicially enforceable 
subpoenas in terrorism investigations; to the Committee on the 
Judiciary.
  Mr. KYL. Mr. President, I rise today to introduce a bill that would 
authorize the Justice Department to issue judicially enforceable 
subpoenas in terrorism investigations.
  Here is how the JETS Act would work: it would allow the FBI to 
subpoena documents and records ``in any investigation of a Federal 
crime of terrorism.'' The bill would require the FBI to go to Federal 
court to enforce the subpoena in the event that the recipient declines 
to comply with it. It would also allow the recipient to make the first 
move and go to court to challenge the subpoena. The JETS Act also would 
allow the Justice Department to temporarily bar the recipient of a JET 
subpoena from disclosing to anyone other than his lawyer that he has 
received it. The FBI could bar such disclosure, however, only if the 
Attorney General certifies that ``otherwise there may result a danger 
to the national security of the United States.'' Also, the recipient of 
the subpoena would have the right to go to court to challenge the 
nondisclosure order. And finally, the JETS Act would protect the 
recipient from any civil liability that might otherwise result from his 
good-faith compliance with a JET subpoena.
  At the outset, it bears mention that the FBI already has ways of 
obtaining a subpoena when it needs one for a terrorism investigation: 
it simply finds an Assistant U.S. Attorney and asks him to issue a 
grand-jury subpoena to investigate a potential crime of terrorism. The 
advantages of the JETS Act--of giving the FBI direct authority to issue 
subpoenas--are not so much

[[Page 13436]]

substantive as procedural. These advantages principally are two: 1. A 
grand-jury subpoena's ``return date''--the date by which the recipient 
of the subpoena is asked to comply--can only be a day on which a grand 
jury is convened. Therefore, a grand-jury subpoena issued on a Friday 
evening cannot have a return date that is earlier than the next Monday. 
The JETS Act would allow the FBI to set an earlier return date, so long 
as that date allows ``a reasonable period of time within which the 
records or items [to be produced] can be assembled and made 
available.'' 2. Only an AUSA can issue a grand-jury subpoena. 
Therefore, whenever the FBI wants to use a grand-jury subpoena in a 
terrorism case, it must find an AUSA. This can be difficult and time 
consuming in remote locations. The JETS Act would allow the FBI to 
forego this exercise.

       The Justice Department recently made its case as to why it 
     should be given JETS authority in its answers to Senator 
     Biden's written questions to Christopher Wray, the Assistant 
     Attorney General for the Criminal Division, following Mr. 
     Wray's testimony before the Judiciary Committee on October 
     21, 2003. Senator Biden asked Mr. Wray to cite ``instances 
     where your terrorism investigations have been thwarted due to 
     an inability to secure a subpoena from a grand jury in a 
     timely fashion.'' While Mr. Wray declined to provide the 
     details of those instances when the lack of direct authority 
     has posed a problem, he did offer the ``following 
     hypothetical situations, which could well arise, [and which] 
     illustrate the need for this investigative tool:''
       ``In the first scenario, anti-terrorism investigators learn 
     that members of an Al Qaeda cell recently stayed at a 
     particular hotel. They want to know how the cell members paid 
     for their rooms, in order to discover what credit cards they 
     may have used. When investigators ask the hotel manager to 
     produce the payment records voluntarily, the manager declines 
     to do so, explaining that company policy prohibits him from 
     revealing such information about customers without legal 
     process. If investigators had the authority to issue an 
     administrative subpoena, the hotel manager could disclose the 
     records about the Al Qaeda cell immediately without fear of 
     legal liability. In this situation, where the speed and 
     success of the investigation may be matters of life and 
     death, this disclosure would immediately provide 
     investigators with crucial information--such as the location 
     of the terrorists and the nature of their purchases--with 
     which to disrupt and prevent terrorist activity.
       ``In the second hypothetical situation, anti-terrorism 
     investigators learn on a Saturday morning that members of an 
     Al Qaeda cell have bought bomb-making materials from a 
     chemical company. They want to obtain records relating to the 
     purchase that may reveal what chemicals the terrorists 
     bought, as well as delivery records that might reveal the 
     terrorists' location. The investigators might seek quickly to 
     contact an Assistant United States Attorney, who might 
     immediately obtain a grand-jury subpoena for the records. 
     However, the third party who holds the records could lawfully 
     refuse to furnish them until the subpoena's `return date,' 
     which must be on a day the grand jury is sitting. Because the 
     grand jury is not scheduled to meet again until Monday 
     morning, investigators may not be able to obtain the 
     information for two days--during which time the Al Qaeda cell 
     may execute its plot. If investigators had the authority to 
     issue an administrative subpoena, which can set a very short 
     or immediate response deadline for information, they may be 
     able to obtain the records immediately and neutralize the 
     cell.''

  Mr. Wray concluded his answer by noting that ``[g]ranting FBI the use 
of [JETS authority] would speed those terrorism investigations in which 
subpoena recipients are not inclined to contest the subpoena in court 
and are willing to comply. Avoiding delays in these situations would 
allow agents to track and disrupt terrorist activity more 
effectively.''
  To place the JETS Act in context, it bears noting that granting the 
FBI direct authority to issue subpoenas in terrorism cases would hardly 
be anomalous. As the Justice Department's Office of Legal Policy 
recently noted in a published report, ``Congress has granted some form 
of administrative subpoena authority to most federal agencies, with 
many agencies holding several such authorities.'' (Report to Congress 
on the Use of Administrative Subpoena Authorities by Executive Branch 
Agencies and Entities, Pursuant to Public Law 106-544, Section 7.) The 
Justice Department ``identified approximately 335 existing 
administrative subpoena authorities held by various executive-branch 
entities under current law.'' Ibid.
  Among the more frequently employed of existing executive-subpoena 
authorities is 18 U.S.C. Sec.  3486's permission for the Attorney 
General to issue subpoenas ``[i]n any investigation of a Federal health 
care offense.'' According to the Public Law 106-544 Report, in the year 
2001 the federal government used Sec.  3486 to issue a total of 2,102 
subpoenas in health-care-fraud investigations. These subpoenas 
uncovered evidence of ``fraudulent claims and false statements such as 
`upcoding,' which is billing for a higher level of service than that 
actually provided; double billing for the same visit; billing for 
services not rendered; and providing unnecessary services.''
  Executive agencies already have direct subpoena authority for many 
types of investigations. Thus it would not be exceptional for Congress 
to grant the same authority to the FBI for terrorism cases. Indeed, as 
Mr. Wray noted in his above-cited answers to questions, ``[b]ecause of 
the benefits that administrative subpoenas provide in fast-moving 
investigations, they may be more necessary in terrorism cases than in 
any other type of investigation.'' One can hardly contend that although 
the federal government can use subpoenas to investigate Mohammed Atta 
if it suspects that he is committing Medicare fraud, it should not be 
allowed to use the same powers if it suspects that he is plotting to 
fly airplanes into buildings.
  Granting direct subpoena authority to the FBI for terrorism cases 
first was proposed by the President last year, near the time of the 
second anniversary of the September 11 attacks. There is one criticism 
of the President's proposal that was made at that time that I believe 
needs to be addressed. The New York Times, in a September 14 story, 
described unnamed ``opponents'' as denouncing the proposal for 
``allow[ing] federal agents to issue subpoenas without the approval of 
a judge or grand jury.''
  This criticism reflects a misunderstanding of grand-jury subpoenas. 
The anonymous opponents of the President's proposal appear to be under 
the impression that the grand jury itself issues a grand-jury subpoena. 
This is not the case. Instead, a grand-jury subpoena is issued by an 
individual federal prosecutor, without any prior involvement by a judge 
or grand jury. As the U.S. Court of Appeals for the District of 
Columbia has noted, ``[i]t is important to realize that a grand jury 
subpoena gets its name from the intended use of the . . . evidence, not 
from the source of its issuance.'' Doe v. DiGenova, 779 F.2d at 80 n. 
11 (1985).
  Like the grand-jury subpoenas currently used to investigate potential 
crimes of terrorism, JET subpoenas also would be issued directly by 
investigators, without pre-approval from a court. It is thus important 
to keep in mind that a subpoena is merely a request for information--a 
request that cannot be enforced until its reasonableness has been 
reviewed by a federal judge. As Mr. Wray noted on behalf of the Justice 
Department in his answers to Senator Biden's questions:

       The FBI could not unilaterally enforce an administrative 
     subpoena issued in a terrorism investigation. As with any 
     other type of subpoena, the recipient of an administrative 
     subpoena issued in a terrorism investigation would be able to 
     challenge that subpoena by filing a motion to quash in the 
     United States District Court for the district in which that 
     person or entity does business or resides. If the court 
     denied the motion to quash, the subpoena recipient could 
     still refuse to comply. The government would then be required 
     to seek another court order compelling compliance with the 
     subpoena.

  This system guarantees protection for civil liberties. The courts 
take very seriously their role in reviewing subpoena-enforcement 
requests. As the Third Circuit has emphasized, ``the district court's 
role is not that of a mere rubber stamp, but of an independent 
reviewing authority called upon to insure the integrity of the 
proceeding.'' Wearly v. FTC, 616 F.2d at 665 (1980). The prospect of 
judicial oversight also inevitably restrains even the initial actions 
of executive agents. As the Public Law 106-544 Report notes, ``an 
agency

[[Page 13437]]

must consider the strictures of [a motion to quash or a challenge to an 
enforcement order] before issuing an administrative subpoena.'' And 
finally, the system of separated authority to issue and review 
subpoenas has itself been recognized to guard civil liberties. The 
federal courts have found that ``[b]ifurcation of the power, on the one 
hand of the agency to issue subpoenas and on the other hand of the 
courts to enforce them, is an inherent protection against abuse of 
subpoena power.'' United States v. Security State Bank and Trust, 473 
F.2d at 641 (5th Cir. 1973).
  The administrative subpoena is a well-established investigative tool 
with built-in protections for civil liberties. Its use in antiterrorism 
investigations should not pose a threat to individual freedom.
  Finally, although the constitutionality of a tool so frequently used 
for so long might safely be assumed, it nevertheless merits describing 
exactly why subpoena power is consistent with the Fourth Amendment. A 
thorough explanation recently was provided by Judge Paul Niemeyer of 
the U.S. Court of Appeals for the Fourth Circuit. As Judge Niemeyer 
noted, the use a subpoena does not require a showing of probable cause 
because a subpoena is not a warrant--it does not authorize an immediate 
physical intrusion of someone's premises in order to conduct a search. 
Rather, subpoenas are subject only to the Fourth Amendment's general 
reasonableness requirement--and they are reasonable in large part 
because of the continuous judicial oversight of their enforcement. As 
Judge Niemeyer stated in his opinion for the court in In re Subpoena 
Duces Tecum, 228 F.3d at 347-49 (2000) (citations omitted):

       While the Fourth Amendment protects people ``against 
     unreasonable searches and seizures,'' it imposes a probable 
     cause requirement only on the issuance of warrants. U.S. 
     Const. amend. IV (``and no Warrants shall issue, but upon 
     probable cause, supported by Oath or affirmation,'' etc.). 
     Thus, unless subpoenas are warrants, they are limited by the 
     general reasonableness standard of the Fourth Amendment 
     (protecting the people against ``unreasonable searches and 
     seizures''), not by the probable cause requirement.
       ``A warrant is a judicial authorization to a law 
     enforcement officer to search or seize persons or things. To 
     preserve advantages of speed and surprise, the order is 
     issued without prior notice and is executed, often by force, 
     with an unannounced and unanticipated physical intrusion. 
     Because this intrusion is both an immediate and substantial 
     invasion of privacy, a warrant may be issued only by a 
     judicial officer upon a demonstration of probable cause--the 
     safeguard required by the Fourth Amendment. See U.S. Const. 
     amend. IV (``no Warrants shall issue, but upon probable 
     cause''). The demonstration of probable cause to a neutral 
     judicial officer places a checkpoint between the Government 
     and the citizen where there otherwise would be no judicial 
     supervision.
       ``A subpoena, on the other hand, commences an adversary 
     process during which the person served with the subpoena may 
     challenge it in court before complying with its demands. As 
     judicial process is afforded before any intrusion occurs, the 
     proposed intrusion is regulated by, and its justification 
     derives from, that process.
       ``If [the appellant in this case] were correct in his 
     assertion that investigative subpoenas may be issued only 
     upon probable cause, the result would be the virtual end to 
     any investigatory efforts by governmental agencies, as well 
     as grand juries. This is because the object of many such 
     investigations--to determine whether probable cause exists to 
     prosecute a violation--would become a condition precedent for 
     undertaking the investigation. This unacceptable paradox was 
     noted explicitly in the grand jury context in United States 
     v. R. Enterprises, Inc., where the Supreme Court stated:
       ``[T]he Government cannot be required to justify the 
     issuance of a grand jury subpoena by presenting evidence 
     sufficient to establish probable cause because the very 
     purpose of requesting the information is to ascertain whether 
     probable cause exists.''

  The U.S. Supreme Court first upheld the constitutionality of subpoena 
authority in 1911. United States v. Wilson, 31 S. Ct. at 542, concluded 
that ``there is no unreasonable search and seizure when a writ, 
suitably specific and properly limited in scope, calls for the 
production of documents which . . . the party procuring [the writ's] 
issuance is entitled to have produced.''
  The Wilson Court also noted that the subpoena power has deep roots in 
the common-law tradition roots--that stretch at least to Elizabethan 
times:

       ``no doubt can be entertained that there must have been 
     some process similar to the subpoena duces tecum to compel 
     the production of documents, not only before [the] time [of 
     Charles the Second], but even before the statute of the 5th 
     of Elizabeth. Prior to that statute, there must have been a 
     power in the Crown (for it would have been utterly impossible 
     to carry on the administration of justice without such power) 
     to require the attendance in courts of justice of persons 
     capable of giving evidence, and the production of documents 
     material to the cause, though in the possession of a 
     stranger.''

  The Supreme Court also has explicitly approved the use of subpoenas 
by executive agencies. In Oklahoma Press Pub. Co. v. Walling, 66 S. Ct. 
494 (1946), the Court found that the investigative role of an executive 
official in issuing a subpoena ``is essentially the same as the grand 
jury's, or the court's in issuing other pretrial orders for the 
discovery of evidence.'' Nearly fifty years ago, the U.S. Supreme Court 
in Walling was able to conclude that Fourth Amendment objections to the 
use of subpoenas by executive agencies merely ``raise[] the ghost of 
controversy long since settled adversely to [that] claim.''
  Because granting direct subpoena authority to antiterror 
investigators would aid them in their important work, and would neither 
intrude upon civil liberties nor conflict with the Constitution, I 
propose the following bill, which would authorize judicially 
enforceable terrorism subpoenas.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2555

     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 ``Judicially Enforceable 
     Terrorism Subpoenas Act of 2004''.

     SEC. 2. ADMINISTRATIVE SUBPOENAS IN TERRORISM INVESTIGATIONS.

       (a) In General.--Chapter 113B of title 18, United States 
     Code, is amended by inserting after section 2332f the 
     following:

     ``Sec. 2332g. Judicially enforceable terrorism subpoenas

       ``(a) Authorization of Use.--
       ``(1) In general.--In any investigation concerning a 
     Federal crime of terrorism (as defined under section 
     2332b(g)(5)), the Attorney General may issue in writing and 
     cause to be served a subpoena requiring the production of any 
     records or other materials that the Attorney General finds 
     relevant to the investigation, or requiring testimony by the 
     custodian of the materials to be produced concerning the 
     production and authenticity of those materials.
       ``(2) Contents.--A subpoena issued under paragraph (1) 
     shall describe the records or items required to be produced 
     and prescribe a return date within a reasonable period of 
     time within which the records or items can be assembled and 
     made available.
       ``(3) Attendance of witnesses and production of records.--
       ``(A) In general.--The attendance of witnesses and the 
     production of records may be required from any place in any 
     State, or in any territory or other place subject to the 
     jurisdiction of the United States at any designated place of 
     hearing.
       ``(B) Limitation.--A witness shall not be required to 
     appear at any hearing more than 500 miles distant from the 
     place where he was served with a subpoena.
       ``(C) Reimbursement.--Witnesses summoned under this section 
     shall be paid the same fees and mileage that are paid to 
     witnesses in the courts of the United States.
       ``(b) Service.--
       ``(1) In general.--A subpoena issued under this section may 
     be served by any person designated in the subpoena as the 
     agent of service.
       ``(2) Service of subpoena.--
       ``(A) Natural person.--Service of a subpoena upon a natural 
     person may be made by personal delivery of the subpoena to 
     that person, or by certified mail with return receipt 
     requested.
       ``(B) Business entities and associations.--Service of a 
     subpoena may be made upon a domestic or foreign corporation, 
     or upon a partnership or other unincorporated association 
     that is subject to suit under a common name, by delivering 
     the subpoena to an officer, to a managing or general agent, 
     or to any other agent authorized by appointment or by law to 
     receive service of process.
       ``(C) Proof of service.--The affidavit of the person 
     serving the subpoena entered by that person on a true copy 
     thereof shall be sufficient proof of service.

[[Page 13438]]

       ``(c) Enforcement.--
       ``(1) In general.--In the case of the contumacy by, or 
     refusal to obey a subpoena issued to, any person, the 
     Attorney General may invoke the aid of any court of the 
     United States within the jurisdiction of which the 
     investigation is carried on, or the subpoenaed person 
     resides, carries on business, or may be found, to compel 
     compliance with the subpoena.
       ``(2) Order.--A court of the United States described under 
     paragraph (1) may issue an order requiring the subpoenaed 
     person, in accordance with the subpoena, to appear, to 
     produce records, or to give testimony touching the matter 
     under investigation. Any failure to obey the order of the 
     court may be punished by the court as contempt thereof.
       ``(3) Service of process.--Any process under this 
     subsection may be served in any judicial district in which 
     the person may be found.
       ``(d)  Nondisclosure requirement.--
       ``(1) In general.--If the Attorney General certifies that 
     otherwise there may result a danger to the national security 
     of the United States, no person shall disclose to any other 
     person that a subpoena was received or records were provided 
     pursuant to this section, other than to--
       ``(A) those persons to whom such disclosure is necessary in 
     order to comply with the subpoena;
       ``(B) an attorney to obtain legal advice with respect to 
     testimony or the production of records in response to the 
     subpoena; or
       ``(C) other persons as permitted by the Attorney General.
       ``(2) Notice of nondisclosure requirement.--The subpoena, 
     or an officer, employee, or agency of the United States in 
     writing, shall notify the person to whom the subpoena is 
     directed of the nondisclosure requirements under paragraph 
     (1).
       ``(3) Further applicability of nondisclosure 
     requirements.--Any person who receives a disclosure under 
     this subsection shall be subject to the same prohibitions on 
     disclosure under paragraph (1).
       ``(4) Enforcement of nondisclosure requirement.--Whoever 
     knowingly violates paragraphs (1) or (3) shall be imprisoned 
     for not more than 1 year, and if the violation is committed 
     with the intent to obstruct an investigation or judicial 
     proceeding, shall be imprisoned for not more than 5 years.
       ``(5) Termination of nondisclosure requirement.--If the 
     Attorney General concludes that a nondisclosure requirement 
     no longer is justified by a danger to the national security 
     of the United States, an officer, employee, or agency of the 
     United States shall notify the relevant person that the 
     prohibition of disclosure is no longer applicable.
       ``(e) Judicial Review.--
       ``(1) In general.--At any time before the return date 
     specified in a summons issued under this section, the person 
     or entity summoned may, in the United States district court 
     for the district in which that person or entity does business 
     or resides, petition for an order modifying or setting aside 
     the summons.
       ``(2) Modification of nondisclosure requirement.--Any court 
     described under paragraph (1) may modify or set aside a 
     nondisclosure requirement imposed under subsection (d) at the 
     request of a person to whom a subpoena has been directed, 
     unless there is reason to believe that the nondisclosure 
     requirement is justified because otherwise there may result a 
     danger to the national security of the United States.
       ``(3) Review of government submissions.--In all proceedings 
     under this subsection, the court shall review the submission 
     of the Federal Government, which may include classified 
     information, ex parte and in camera.
       ``(f) Immunity From Civil Liability.--Any person, including 
     officers, agents, and employees of a non-natural person, who 
     in good faith produce the records or items requested in a 
     subpoena, shall not be liable in any court of any State or 
     the United States to any customer or other person for such 
     production, or for nondisclosure of that production to the 
     customer or other person.
       ``(g) Guidelines.--The Attorney General shall, by rule, 
     establish such guidelines as are necessary to ensure the 
     effective implementation of this section.''.
       (b) Amendment to Table of Sections.--The table of sections 
     of chapter 113B of title 18, United States Code, is amended 
     by inserting after the item relating to section 2332f the 
     following:

``2332g. Judicially enforceable terrorism subpoenas.''.
                                 ______
                                 
      By Mr. BINGAMAN (for himself and Mr. Lieberman):
  S. 2556. A bill to amend chapter 7 of title 31, United States Code, 
to provide for a technology assessment capability within the General 
Accounting Office, and for other purposes; to the Committee on 
Governmental Affairs.
  Mr. BINGAMAN. Mr. President, I rise today with my colleague Senator 
Lieberman to introduce a bill that would give the Congress a modest 
capability to assess the impacts of science and technology on the 
formulation of public policy.
  All of us in the Senate are all too aware how science and technology 
affects almost every aspect of policy we debate.
  For instance, advances in science and technology are critical to our 
homeland defense oversight duties. There are many legislative proposals 
to deploy biological detection sensors in our cities. Yet, Congress 
does not get timely, in-depth advice on the policy implications on such 
issues as how many would be needed in a large city, or how will the 
data be integrated into a communications network, and would such a 
large volume of data be accurately analyzed and disseminated in a 
timely fashion. In another area of homeland defense, we are not 
confident on what the policy implications are for biometrics applied to 
border control. What are the costs for applying biometrics to the 
millions of visas we issue every year? How might these biometrics, 
which record our physiological features into a single database, invade 
our notions of privacy?
  In the jurisdiction of my committee, Energy and Natural Resources, we 
would like to know how technology could mitigate the threat of 
wildfires, especially on urban regions adjacent to our national 
forests. We know that there are improvements in building materials and 
construction techniques that can reduce the danger of homes suddenly 
catching fire and spreading to adjacent homes. However, the effect of 
such technology improvements on policy matters involving building 
codes, fire and disaster insurance, and coordination of communications 
between federal and local emergency response are unknown, yet critical 
to our law making duties.
  There are other areas where technology affects law making and 
oversight duties. The Congress has supported efforts to integrate 
technology into one of the most crucial elements of democracy--voting. 
Nevertheless, questions remain on the accountability of each vote, and 
the cyber-security of electronic voting systems. These voting 
technology issues directly affect the public confidence in any law we 
may write to bring electronic voting into the mainstream.
  I could go on and on, but these examples lead me to the bill I am 
introducing today.
  Congress abolished the Office of Technology Assessment (OTA) in 1995. 
While I disagreed with this decision, the bill I am proposing today 
seeks to establish a smaller, less costly capability in the General 
Accounting Office (GAO).
  The Congressional Research Service (CRS) and GAO have many 
technology-competent personnel, but neither assesses the effects of 
technology on policy-making. The CRS or GAO may study or catalog 
various technologies, they may assess the merits of one technology 
versus another, or even its economic benefits and costs, but they do 
not analyze how the technology can affect policy.
  Some may assert the National Academy of Sciences performs such a 
function. The National Academies independently, through outside 
advisory committees, evaluates the technological merits of programs 
that involve technology, usually funded by the executive branch, and 
not directly by the Congress. The majority of the technology 
evaluations by the National Academies are not technology assessments, 
they do not consider what consequences a technology will have on the 
policies that the Congress considers. Because the Academy maintains a 
strong independence, the timing of their reports are not, and should 
not be, linked to the Congressional calendar.
  I believe it is possible have an existing legislative branch agency 
such as the GAO give to neutral, objective technology assessments to 
the Congress in a timely fashion. I am of the opinion that the GAO can 
undertake this function without creating a large bureaucracy.
  Let me first outline the history of the legislation I am proposing.
  Three years ago, with the help of Senator Bennett, who then chaired 
the Legislative Branch Subcommittee on Appropriations, I was able to 
initiate a

[[Page 13439]]

pilot program at the GAO to perform technology assessments of interest 
to the Congress. It was Senator Bennett who first suggested placing 
this pilot at the GAO, and when contacted, the GAO stepped forward to 
accept that challenge.
  Since that time, the three-year pilot program at the GAO has 
conducted, or has underway, technology assessments on a wide range of 
topics, from biometrics for border control, cyber-security, cargo 
container security, and technology to mitigate the impact of wildfires 
on urban boundaries. All of these assessments were initiated by 
bipartisan and bicameral letters to the GAO.
  I believe this pilot program to be a success. The first report on 
biometrics for border control has received good evaluations from 
industry and congressional staff. The GAO still testifies on the 
results from the report. The second report on cyber-security has just 
been released, experts across government and the private sector believe 
it is of high quality. A technology assessment on cargo container 
security is underway. A wildfire technology assessment has just been 
initiated.
  In addition, this pilot program has undergone several reviews.
  The first review occurred in October of 2002, when the first 
technology assessment on biometrics ended. A group of distinguished 
scientists, familiar with the technology assessment process, reviewed 
the GAO's organizational capability to conduct future technology 
assessments. While they were impressed with the quality of the GAO's 
effort, they made positive suggestions on how the GAO could improve the 
policy analysis phase of the technology assessment, as this crucial 
feature was new to the GAO. The group of experts reviewed the 
organizational mix of the GAO, and its ability to absorb the technology 
assessment process within their traditional audit and quality control 
structure. These experts found that the GAO's Center for Technology and 
Engineering, which performed the first biometrics assessment, was a 
capable organization, as it was accustomed to undertaking a wide range 
of technology-oriented problems. Finally, the experts commented on how 
the GAO could utilize nongovernmental entities to perform the data 
collection, thus reducing the potential to create a new bureaucracy. 
For the first biometrics report, the experts supported the GAO working 
with the National Research Council to conduct stakeholder workshops to 
gather a wide range of data, while the report writing would be by a 
legislative branch entity--the GAO.
  The second review was a workshop held in July of 2003, at the 
National Academy of Sciences. A wide array of nongovernmental attendees 
evaluated the pilot program at the GAO in the context of other 
organization models for technology assessment, from recreating the old 
OTA to simply using the National Academies. This was the first time 
many nongovernmental persons were exposed to the GAO pilot and many 
were surprised that the GAO was willing to undertake such a program, 
and that its staff quickly adapted to the technology assessment 
process.
  The third review occurred in December of 2003 at the request of the 
Senate Legislative Branch Appropriations Subcommittee. This review was 
conducted by the GAO. The subcommittee asked what would be required to 
conduct this pilot on a sustained basis. The GAO concluded that four 
full time staff would be required at a cost of $420,000, plus $125,000 
for additional expenses to work with outside groups such as the 
National Research Council to collect data. This request has appeared as 
part of GAO's Fiscal Year 2005 budget submission. The GAO also 
requested additional legislative authorities so that the assessments 
could be part of their annual budget process.
  This bill is in response to the December 2003 findings of GAO; it has 
been fully coordinated with the GAO and their findings. This bill also 
reflects the comments from the July 2003 National Academies workshop 
and the first review of the GAO by the expert panel in October of 2002.
  Let me now outline several feature of this bill, and then I will 
comment on what this bill does not have.
  First, the bill proposes to modify the GAO's organic act to give it 
the statutory authority to perform technology assessments as part of 
its advice to the Congress. In doing so, the GAO is directed make such 
technology assessments in a timely and objective fashion. One of the 
major issues with the OTA was that many of its reports were so in-depth 
that they missed the legislative cycle to make a substantive impact on 
a bill under consideration by the Congress. In addition to the longer, 
more in-depth reports, I expect that the GAO will give quick turn-
around phone consultations on singular technology assessment questions 
by staff.
  Second, it directs the Comptroller General to ensure that the GAO has 
the human resources expertise in technology and policy to ensure a high 
quality product.
  Third, it directs the Comptroller General, to the maximum extent 
practicable, to be apprised of other ongoing efforts that may be 
providing information to the Congress.
  Fourth, it directs the Comptroller to peer review all the technology 
assessment reports.
  Fifth, it directs the Comptroller General to establish an advisory 
board in consultation with the National Academy of Sciences. This board 
shall provide external advice on the assessment topics, how they are 
selected, and methods to their improve timeliness and quality. Many 
times advisory boards are an extra overhead burden, but in this case, 
where the GAO is acting as a bridge between the outside technical 
community and the Congress, I feel it is important that some form of 
external peer review of the technology assessment process be present.
  Sixth, it gives the GAO the necessary authority to enter into 
contracts with outside groups to obtain the information and technical 
feedback that does not reside within the GAO, thus avoiding the 
creation of a bureaucracy within the GAO.
  Finally, it requires the GAO to submit an annual report to the 
Congress on its technology assessment activities from the prior year.
  Let me explain what this authorization does not do.
  First, it does not create a Technology Assessment Board consisting of 
members of Congress to help select topics. There was much concern that 
the OTA became almost beholden to its Technology Assessment Board to 
the dismay of other members of Congress. I have left the topic 
selection process to the GAO within their existing authorities, similar 
to the way they currently schedule and produce reports for members and 
committees. This process has been refined and tested over many years, 
and it is flexible enough to accommodate sudden high priority demands. 
I see no reason why scheduling technology assessments cannot be part of 
this bigger scheduling process, so that its demands are reflected in 
the overall scheduling priorities of the GAO.
  Second, this legislation does not create a large legislative branch 
entity. The OTA had upwards of 200 people and a $30 million budget 
before it was disbanded in 1995. This authorization relies on a core 
internal group at the GAO that relies on outside entities to provide 
information where needed and to be a technical sounding board through 
workshops on a particular technology and its various policy 
implications.
  This legislation strikes an important balance. It establishes some 
internal legislative branch capability to analyze how technology 
affects our policymaking duties. It fills a void left when the OTA was 
abolished by relying on a core team at the GAO using their existing 
authorities for topic selection. Finally, it provides an important 
bridge to the many nongovernmental entities and societies that give 
advice to the executive branch and Congress, while ensuring legislative 
branch objectivity and quality.
  I hope my colleagues join me in supporting this legislation. I hope 
that it receives a hearing in the Governmental Affairs Committee, so 
that all sides of the fact finding process can be brought to bear on 
this bill's strengths and

[[Page 13440]]

weaknesses, and in so doing, be improved and reported to the floor of 
the Senate for its full consideration and passage.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2556

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

     SECTION 1. GENERAL ACCOUNTING OFFICE TECHNOLOGY ASSESSMENTS.

       (a) Findings and Purposes.--
       (1) Findings.--Congress finds that--
       (A) it is important for Congress to be better informed 
     regarding the impact of technology on matters of public 
     concern, including implications for economic, national 
     security, social, scientific, and other national policies and 
     programs;
       (B) on a pilot basis, the General Accounting Office has 
     demonstrated a capacity to perform independent and objective 
     technology assessments for Congress; and
       (C) the development of a cost-effective and efficient 
     capacity for timely and deliberate technology assessments by 
     the General Accounting Office requires the commitment of 
     additional resources and administrative flexibility given the 
     current resource constraints of the General Accounting 
     Office.
       (2) Purposes.--The purposes of this Act are to--
       (A) direct the establishment of a technology assessment 
     capability in the General Accounting Office;
       (B) ensure the quality of such technology assessments in 
     order to enhance the ability of Congress to address complex 
     technical issues in a more timely and effective manner; and
       (C) condition the development of a technology assessment 
     capability in the General Accounting Office on the provision 
     of adequate additional resources and administrative 
     flexibility.
       (b) Technology Assessments.--Chapter 7 of title 31, United 
     States Code, is amended by inserting after section 720 the 
     following:

     ``Sec. 721. Technology assessments

       ``(a) The General Accounting Office shall establish a 
     technology assessment capability to coordinate and prepare 
     information for Congress relating to the policy implications 
     of applications of technology.
       ``(b) The Comptroller General may establish standards and 
     procedures to govern technology assessments performed under 
     this section as the Comptroller General determines necessary.
       ``(c) Technology assessments performed under this section 
     shall--
       ``(1) provide Congress with timely and objective 
     information to contribute to legislative consideration of 
     technology applications and their policy implications, 
     including thorough reports, in-depth studies, and short-term 
     consultations;
       ``(2) be undertaken by the Comptroller General with special 
     attention to the technical expertise and policy analysis 
     skills needed to perform a prospective assessment of 
     technology applications and policy implications;
       ``(3) be designed, to the extent practicable, to review an 
     application of technology to an issue of public interest, 
     including consideration of benefits, cost, and risks from 
     such technology; and
       ``(4) include peer review by persons and organizations of 
     appropriate expertise.
       ``(d) In performing technology assessments, the Comptroller 
     General shall be properly apprised of Federal and non-Federal 
     entities providing information to Congress to--
       ``(1) enable effective coverage of critical issues; and
       ``(2) avoid duplication of effort.
       ``(e) Technology assessments performed under this section 
     may be initiated as provided under section 717(b).
       ``(f)(1) In consultation with the National Academy of 
     Sciences, the Comptroller General shall establish a 
     technology assessment advisory panel to provide advice on 
     technology assessments performed under this section, 
     methodologies, possible subjects of study, and the means of 
     improving the quality and timeliness of technology assessment 
     services provided to Congress.
       ``(2) The advisory panel shall consist of 5 members, who by 
     reason of professional background and experience, are 
     specially qualified to advise on technology assessments.
       ``(3) Terms on the advisory panel shall--
       ``(A) be for a period of 2 years; and
       ``(B) begin on January 1, on each year in which a new 
     Congress is convened.
       ``(4) Notwithstanding section 1342, for the purposes of 
     establishing a technology assessment advisory panel, the 
     Comptroller General may accept and use voluntary and 
     uncompensated services (except for reimbursement of travel 
     expenses). Individuals providing such voluntary and 
     uncompensated services shall not be considered Federal 
     employees, except for purposes of chapter 81 of title 5 and 
     chapter 171 of title 28.
       ``(g)(1) In order to gain access to technical knowledge, 
     skills, and expertise necessary for a technology assessment 
     performed under this section, the Comptroller General may 
     utilize individuals and enter into contracts or other 
     arrangements to acquire needed expertise with any agency or 
     instrumentality of the United States, with any State, 
     territory, or possession or any political subdivision 
     thereof, or with any person, firm, association, corporation, 
     or educational institution.
       ``(2) Contracts and other arrangements under this 
     subsection may be entered into--
       ``(A) with or without reimbursement; and
       ``(B) without regard to section 3709 of the Revised 
     Statutes (41 U.S.C. 5) or section 3324 of this title.
       ``(h) The Comptroller General shall submit to Congress an 
     annual report on technology assessment activities of the 
     General Accounting Office.
       ``(i)(1) There are authorized to be appropriated to the 
     General Accounting Office to carry out the activities 
     described in this section, $2,000,000 for each of fiscal 
     years 2004, 2005, and 2006.
       ``(2) Technology assessments under this section may not be 
     performed during fiscal years 2004, 2005, and 2006, unless a 
     sufficient annual appropriation is provided for such fiscal 
     years.''.
       (c) Technical and Conforming Amendment.--The table of 
     sections for chapter 7 of title 31, United States Code, is 
     amended by inserting after the item relating to section 720 
     the following:

``721. Technology assessments.''.


                                  ____
      By Mr. Durbin (for himself, Mr. Reed, Mr. Lautenberg, Mr. 
        Kennedy, Mrs. Feinstein, Mr. Corzine,, Ms. Mikulski, Mr. Levin, 
        Mr. Schumer, Mrs. Clinton, and Mrs. Boxer):
  S. 2557. A bill to amend the Consolidated Appropriations Act, 2004, 
to strike the restriction on use of funds that requires a 24-hour time 
limit for destroying identifying information submitted in relation to a 
firearm background check; to the Committee on the Judiciary.
  Mr. DURBIN. Mr. President, today, I am introducing a bill that would 
repeal a provision in the Consolidated Appropriations Act of 2004, 
regarding the amount of time that records of approved gun sales can be 
retained.
  This provision, which will be enacted within the next month, was a 
measure that the House and Senate conferees agreed to drop, but 
nonetheless was inserted at the last minute into the Conference Report. 
That provision is opposed by law enforcement and threatens public 
safety because each year, it would allow hundreds of convicted felons, 
fugitives, and possibly even terrorists, to have firearms--even though 
they are prohibited by Federal law from having one.
  Under the Brady Handgun Violence Prevention Act, licensed firearms 
dealers generally are prohibited from transferring firearms to an 
individual until a search of the National Instant Criminal Background 
Check System (NICS) determines that the transfer would not violate 
applicable Federal or State law. For example, these background checks 
determine if someone is a convicted felon; convicted of a crime of 
domestic violence or under a domestic violence restraining order; or a 
fugitive. Current regulations allow the records of approved firearms 
sales to be retained in a computer database, known as the NICS Audit 
Log, for up to 90 days, after which the records must be destroyed.
  The NICS Audit Log provides many useful and necessary functions. 
First, it allows examiners to determine if, based on new information, 
someone who was allowed to receive a firearm is in fact prohibited by 
federal law from doing so. Second, the NICS Audit Log allows the FBI to 
search for patterns of fraud and abuse by both gun dealers and 
purchasers. Finally, it can help determine if gun buyers have submitted 
false identification in order to thwart the background check system.
  The provision that my legislation today would repeal reduced the time 
these records may be retained from 90 days to 24 hours. This will 
decrease the effectiveness of the NICS Audit Log and have a dramatic, 
negative impact on public safety.
  In July 2001, the Department of Justice proposed an almost-identical 
change to the NICS regulations. In response to that proposal, I asked 
the non-partisan General Accounting Office to conduct a study on its 
possible effects. The key finding of this study was: ``Regarding public 
safety, the FBI would lose certain abilities to initiate

[[Page 13441]]

firearm-retrieval actions when new information reveals that individuals 
who were approved to purchase firearms should not have been. 
Specifically, during the first 6 months of the current 90-day retention 
policy, the FBI used retained records to initiate 235 firearm-retrieval 
actions, of which 228, 97 percent, could not have been initiated under 
the proposed next-day destruction policy.''
  Therefore, if this provision is not repealed, each year, more than 
450 people who are prohibited by federal law from having a firearm 
nonetheless will have one.
  This number could even be much higher. In the 6 months examined by 
the GAO, the FBI determined that an additional 179 transactions were 
initially approved and reversed more than one day later, but did not 
result in actual firearm sales. In other words, during this six-month 
period, the background checks yielded a total of 407 mistakes that 
would not have been caught if the NICS record retention period had been 
shortened to 24 hours.
  Given this negative effect on public safety, many law enforcement 
agencies and officials have expressed their opposition. For example, 
the Law Enforcement Steering Committee (LESC), a nonpartisan coalition 
of organizations representing law enforcement management, labor, and 
research, is ``concerned with provisions included in the omnibus bill 
addressing firearms purchasing and the reduction of law enforcement 
oversight.'' The nine organizations in the LESC are the following: the 
Federal Law Enforcement Officers Association, the International 
Brotherhood of Police Officers, the Major Cities Chiefs Association, 
the Major County Sheriff's Association, the National Association of 
Police Organizations, the National Organization of Black Law 
Enforcement Executives, the National Troopers Coalition, the Police 
Executive Research Forum, and the Police Foundation.
  The Federal Bureau of Investigation Agents Association, a non-
governmental professional association with a membership of nearly 9,000 
current and more than 2,000 retired FBI agents nationwide has written: 
``The more the retention period is reduced, the more difficult it would 
become to use the paperwork to investigate or prosecute crimes related 
to the use of sales of the firearms in question. Any such efforts can 
only complicate the already difficult task of law enforcement and 
jeopardize public safety.''
  Although the FBI Agents Association does not speak for the official 
FBI, it is worth noting that the FBI's NICS Operations Report in March 
2000 recommended extending the retention period from 90 days to one 
year and noted that the Advisory Policy Board concurred with that 
recommendation.
  Finally, the International Association of Chiefs of Police, the 
world's oldest and largest association of law enforcement executives, 
with more than 19,000 members in 90 countries, stands behind its 2001 
letter to the FBI, in which the IACP wrote: ``We believe that 
decreasing the amount of time the purchase records are kept will weaken 
the background check system and allow more criminals to illegally 
obtain weapons. . . . The IACP believes that the 90-day retention 
period should not be shortened. Decreasing the retention period of 
these records to one business day will not provide law enforcement with 
sufficient time to perform the necessary audits on the NICS system as 
established by the Brady Act.''
  In addition to the threat to public safety, this provision will have 
monetary costs. According to the GAO report, the FBI has determined 
that when this change in the NICS retention policy is implemented, many 
of the audits currently conducted on a monthly or quarterly basis would 
have to be conducted on a real-time basis--either hourly or daily. The 
FBI has said it would need to add 10 staff members to conduct these 
real-time audits, which would bring the total number of audit staff to 
19.
  Especially in this time of increased attention to homeland security, 
this is not the proper allocation of our limited resources. Unless we 
repeal this provision, we will be funding ten additional FBI staff 
members to implement a policy that would allow hundreds of convicted 
felons and fugitives to keep their firearms. That clearly does not make 
sense.
  The clock is ticking: this provision will go into effect in less than 
a month, before July 21, 2004. We must act now to keep firearms out of 
the hands of hundreds of convicted felons, fugitives, and terrorists 
each year. I urge my colleagues to join me in support of this 
important, commonsense legislation to promote public safety and to 
ensure that similar provisions are not enacted in future appropriation 
legislation.
                                 ______
                                 
      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

[[Page 13442]]

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 
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

[[Page 13443]]

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- 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

[[Page 13444]]

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 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.
  There being no objection, the bill was ordered to be printed in the 
Record as follows:

                                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''.

[[Page 13445]]



     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 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.

[[Page 13446]]

  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.

                          ____________________