[Congressional Record (Bound Edition), Volume 150 (2004), Part 15]
[House]
[Pages 20812-20821]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              {time}  1500
          SECURELY PROTECT YOURSELF AGAINST CYBER TRESPASS ACT

  Mr. BARTON of Texas. Mr. Speaker, I move to suspend the rules and 
pass the bill (H.R. 2929) to protect users of the Internet from 
unknowing transmission of their personally identifiable information 
through spyware programs, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 2929

       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 ``Securely Protect Yourself 
     Against Cyber Trespass Act'' or the ``SPY ACT''.

     SEC. 2. PROHIBITION OF DECEPTIVE ACTS OR PRACTICES RELATING 
                   TO SPYWARE.

       (a) Prohibition.--It is unlawful for any person, who is not 
     the owner or authorized user of a protected computer, to 
     engage in deceptive acts or practices that involve any of the 
     following conduct with respect to the protected computer:
       (1) Taking control of the computer by--
       (A) utilizing such computer to send unsolicited information 
     or material from the protected computer to others;
       (B) diverting the Internet browser of the computer, or 
     similar program of the computer used to access and navigate 
     the Internet--
       (i) without authorization of the owner or authorized user 
     of the computer; and
       (ii) away from the site the user intended to view, to one 
     or more other Web pages, such that the user is prevented from 
     viewing the content at the intended Web page, unless such 
     diverting is otherwise authorized ;
       (C) accessing or using the modem, or Internet connection or 
     service, for the computer and thereby causing damage to the 
     computer or causing the owner or authorized user to incur 
     unauthorized financial charges;
       (D) using the computer as part of an activity performed by 
     a group of computers that causes damage to another computer; 
     or
       (E) delivering advertisements that a user of the computer 
     cannot close without turning off the computer or closing all 
     sessions of the Internet browser for the computer.
       (2) Modifying settings related to use of the computer or to 
     the computer's access to or use of the Internet by altering--
       (A) the Web page that appears when the owner or authorized 
     user launches an Internet browser or similar program used to 
     access and navigate the Internet;
       (B) the default provider used to access or search the 
     Internet, or other existing Internet connections settings;
       (C) a list of bookmarks used by the computer to access Web 
     pages; or
       (D) security or other settings of the computer that protect 
     information about the owner or authorized user for the 
     purposes of causing damage or harm to the computer or owner 
     or user.
       (3) Collecting personally identifiable information through 
     the use of a keystroke logging function.
       (4) Inducing the owner or authorized user to install a 
     computer software component onto the computer, or preventing 
     reasonable efforts to block the installation or execution of, 
     or to disable, a computer software component by--
       (A) presenting the owner or authorized user with an option 
     to decline installation of a software component such that, 
     when the option is selected by the owner or authorized user, 
     the installation nevertheless proceeds; or
       (B) causing a computer software component that the owner or 
     authorized user has properly removed or disabled to 
     automatically reinstall or reactivate on the computer.
       (5) Misrepresenting that installing a separate software 
     component or providing log-in and password information is 
     necessary for security or privacy reasons, or that installing 
     a separate software component is necessary to open, view, or 
     play a particular type of content.
       (6) Inducing the owner or authorized user to install or 
     execute computer software by misrepresenting the identity or 
     authority of the person or entity providing the computer 
     software to the owner or user.
       (7) Inducing the owner or authorized user to provide 
     personally identifiable, password, or account information to 
     another person--
       (A) by misrepresenting the identity of the person seeking 
     the information; or
       (B) without the authority of the intended recipient of the 
     information.
       (8) Removing, disabling, or rendering inoperative a 
     security, anti-spyware, or anti-virus technology installed on 
     the computer.
       (9) Installing or executing on the computer one or more 
     additional computer software components with the intent of 
     causing a person to use such components in a way that 
     violates any other provision of this section.
       (b) Guidance.--The Commission shall issue guidance 
     regarding compliance with and violations of this section. 
     This subsection shall take effect upon the date of the 
     enactment of this Act.
       (c) Effective Date.--Except as provided in subsection (b), 
     this section shall take effect upon the expiration of the 6-
     month period that begins on the date of the enactment of this 
     Act.

     SEC. 3. PROHIBITION OF COLLECTION OF CERTAIN INFORMATION 
                   WITHOUT NOTICE AND CONSENT.

       (a) Opt-In Requirement.--Except as provided in subsection 
     (e), it is unlawful for any person--
       (1) to transmit to a protected computer, which is not owned 
     by such person and for which such person is not an authorized 
     user, any information collection program, unless--
       (A) such information collection program provides notice in 
     accordance with subsection (c) before execution of any of the 
     information collection functions of the program; and
       (B) such information collection program includes the 
     functions required under subsection (d); or
       (2) to execute any information collection program installed 
     on such a protected computer unless--
       (A) before execution of any of the information collection 
     functions of the program, the owner or an authorized user of 
     the protected computer has consented to such execution 
     pursuant to notice in accordance with subsection (c); and
       (B) such information collection program includes the 
     functions required under subsection (d).
       (b) Information Collection Program.--For purposes of this 
     section, the term ``information collection program'' means 
     computer software that--
       (1)(A) collects personally identifiable information; and
       (B)(i) sends such information to a person other than the 
     owner or authorized user of the computer, or
       (ii) uses such information to deliver advertising to, or 
     display advertising, on the computer; or
       (2)(A) collects information regarding the Web pages 
     accessed using the computer; and
       (B) uses such information to deliver advertising to, or 
     display advertising on, the computer.
       (c) Notice and Consent.--
       (1) In general.--Notice in accordance with this subsection 
     with respect to an information collection program is clear 
     and conspicuous notice in plain language, set forth as the 
     Commission shall provide, that meets all of the following 
     requirements:
       (A) The notice clearly distinguishes such notice from any 
     other information visually presented contemporaneously on the 
     protected computer.
       (B) The notice contains one of the following statements, as 
     applicable, or a substantially similar statement:
       (i) With respect to an information collection program 
     described in subsection (b)(1): ``This program will collect 
     and transmit information about you. Do you accept?''.
       (ii) With respect to an information collection program 
     described in subsection (b)(2): ``This program will collect 
     information about Web pages you access and will use that 
     information to display advertising on your computer. Do you 
     accept?''.
       (iii) With respect to an information collection program 
     that performs the actions described in both paragraphs (1) 
     and (2) of subsection (b): ``This program will collect and 
     transmit information about you and your computer use and will 
     collect information about Web pages you access and use that 
     information to display advertising on your computer. Do you 
     accept?''.
       (C) The notice provides for the user--
       (i) to grant or deny consent referred to in subsection (a) 
     by selecting an option to grant or deny such consent; and
       (ii) to abandon or cancel the transmission or execution 
     referred to in subsection (a) without granting or denying 
     such consent.
       (D) The notice provides an option for the user to select to 
     display on the computer, before granting or denying consent 
     using the option required under subparagraph (C), a clear 
     description of--
       (i) the types of information to be collected and sent (if 
     any) by the information collection program;
       (ii) the purpose for which such information is to be 
     collected and sent; and
       (iii) in the case of an information collection program that 
     first executes any of the information collection functions of 
     the program together with the first execution of other 
     computer software, the identity of any such software that is 
     an information collection program.
       (E) The notice provides for concurrent display of the 
     information required under subparagraphs (B) and (C) and the 
     option required under subparagraph (D) until the user--
       (i) grants or denies consent using the option required 
     under subparagraph (C)(i);
       (ii) abandons or cancels the transmission or execution 
     pursuant to subparagraph (C)(ii); or

[[Page 20813]]

       (ii) selects the option required under subparagraph (D).
       (2) Single notice.--The Commission shall provide that, in 
     the case in which multiple information collection programs 
     are provided to the protected computer together, or as part 
     of a suite of functionally-related software, the notice 
     requirements of paragraphs (1)(A) and (2)(A) of subsection 
     (a) may be met by providing, before execution of any of the 
     information collection functions of the programs, clear and 
     conspicuous notice in plain language in accordance with 
     paragraph (1) of this subsection by means of a single notice 
     that applies to all such information collection programs, 
     except that such notice shall provide the option under 
     subparagraph (D) of paragraph (1) of this subsection with 
     respect to each such information collection program.
       (3) Change in information collection.--If an owner or 
     authorized user has granted consent to execution of an 
     information collection program pursuant to a notice in 
     accordance with this subsection:
       (A) In general.--No subsequent such notice is required, 
     except as provided in subparagraph (B).
       (B) Subsequent notice.--The person who transmitted the 
     program shall provide another notice in accordance with this 
     subsection and obtain consent before such program may be used 
     to collect or send information of a type or for a purpose 
     that is materially different from, and outside the scope of, 
     the type or purpose set forth in the initial or any previous 
     notice.
       (4) Regulations.--The Commission shall issue regulations to 
     carry out this subsection.
       (d) Required Functions.--The functions required under this 
     subsection to be included in an information collection 
     program that executes any information collection functions 
     with respect to a protected computer are as follows:
       (1) Disabling function.--With respect to any information 
     collection program, a function of the program that allows a 
     user of the program to remove the program or disable 
     operation of the program with respect to such protected 
     computer by a function that--
       (A) is easily identifiable to a user of the computer; and
       (B) can be performed without undue effort or knowledge by 
     the user of the protected computer.
       (2) Identity function.--With respect only to an information 
     collection program that uses information collected in the 
     manner described in paragraph (1)(B)(ii) or (2)(B) of 
     subsection (b), a function of the program that provides that 
     each display of an advertisement directed or displayed using 
     such information when the owner or authorized user is 
     accessing a Web page or online location other than of the 
     provider of the software is accompanied by the name of the 
     information collection program, a logogram or trademark used 
     for the exclusive purpose of identifying the program, or a 
     statement or other information sufficient to clearly identify 
     the program.
       (3) Rulemaking.--The Commission may issue regulations to 
     carry out this subsection.
       (e) Limitation on Liability.--A telecommunications carrier, 
     a provider of information service or interactive computer 
     service, a cable operator, or a provider of transmission 
     capability shall not be liable under this section to the 
     extent that the carrier, operator, or provider--
       (1) transmits, routes, hosts, stores, or provides 
     connections for an information collection program through a 
     system or network controlled or operated by or for the 
     carrier, operator, or provider; or
       (2) provides an information location tool, such as a 
     directory, index, reference, pointer, or hypertext link, 
     through which the owner or user of a protected computer 
     locates an information collection program.

     SEC. 4. ENFORCEMENT.

       (a) Unfair or Deceptive Act or Practice.--This Act shall be 
     enforced by the Commission under the Federal Trade Commission 
     Act (15 U.S.C. 41 et seq.). A violation of any provision of 
     this Act or of a regulation issued under this Act committed 
     with actual knowledge or knowledge fairly implied on the 
     basis of objective circumstances that such act is unfair or 
     deceptive or violates this Act shall be treated as an unfair 
     or deceptive act or practice violating a rule promulgated 
     under section 18 of the Federal Trade Commission Act (15 
     U.S.C. 57a).
       (b) Penalty for Pattern or Practice Violations.--
       (1) In general.--Notwithstanding subsection (a) and the 
     Federal Trade Commission Act, in the case of a person who 
     engages in a pattern or practice that violates section 2 or 
     3, the Commission may, in its discretion, seek a civil 
     penalty for such pattern or practice of violations in an 
     amount, as determined by the Commission, of not more than--
       (A) $3,000,000 for each violation of section 2; and
       (B) $1,000,000 for each violation of section 3.
       (2) Treatment of single action or conduct.--In applying 
     paragraph (1)--
       (A) any single action or conduct that violates section 2 or 
     3 with respect to multiple protected computers shall be 
     treated as a single violation; and
       (B) any single action or conduct that violates more than 
     one paragraph of section 2(a) shall be considered multiple 
     violations, based on the number of such paragraphs violated.
       (c) Exclusiveness of Remedies.--The remedies in this 
     section (including remedies available to the Commission under 
     the Federal Trade Commission Act) are the exclusive remedies 
     for violations of this Act.
       (d) Effective Date.--This section shall take effect on the 
     date of the enactment of this Act, but only to the extent 
     that this section applies to violations of section 2(a).

     SEC. 5. LIMITATIONS.

       (a) Law Enforcement Authority.--Sections 2 and 3 of this 
     Act shall not apply to--
       (1) any act taken by a law enforcement agent in the 
     performance of official duties; or
       (2) the transmission or execution of an information 
     collection program in compliance with a law enforcement, 
     investigatory, national security, or regulatory agency or 
     department of the United States or any State in response to a 
     request or demand made under authority granted to that agency 
     or department, including a warrant issued under the Federal 
     Rules of Criminal Procedure, an equivalent State warrant, a 
     court order, or other lawful process.
       (b) Exception Relating to Security.--Nothing in this Act 
     shall apply to--
       (1) any monitoring of, or interaction with, a subscriber's 
     Internet or other network connection or service, or a 
     protected computer, by a telecommunications carrier, cable 
     operator, computer hardware or software provider, or provider 
     of information service or interactive computer service, to 
     the extent that such monitoring or interaction is for network 
     or computer security purposes, diagnostics, technical 
     support, or repair, or for the detection or prevention of 
     fraudulent activities; or
       (2) a discrete interaction with a protected computer by a 
     provider of computer software solely to determine whether the 
     user of the computer is authorized to use such software, that 
     occurs upon--
       (A) initialization of the software; or
       (B) an affirmative request by the owner or authorized user 
     for an update of, addition to, or technical service for, the 
     software.
       (c) Good Samaritan Protection.--No provider of computer 
     software or of interactive computer service may be held 
     liable under this Act on account of any action voluntarily 
     taken, or service provided, in good faith to remove or 
     disable a program used to violate section 2 or 3 that is 
     installed on a computer of a customer of such provider, if 
     such provider notifies the customer and obtains the consent 
     of the customer before undertaking such action or providing 
     such service.
       (d) Limitation on Liability.--A manufacturer or retailer of 
     computer equipment shall not be liable under this Act to the 
     extent that the manufacturer or retailer is providing third 
     party branded software that is installed on the equipment the 
     manufacturer or retailer is manufacturing or selling.

     SEC. 6. EFFECT ON OTHER LAWS.

       (a) Preemption of State Law.--
       (1) Preemption of spyware laws.--This Act supersedes any 
     provision of a statute, regulation, or rule of a State or 
     political subdivision of a State that expressly regulates--
       (A) deceptive conduct with respect to computers similar to 
     that described in section 2(a);
       (B) the transmission or execution of a computer program 
     similar to that described in section 3; or
       (C) the use of computer software that displays advertising 
     content based on the Web pages accessed using a computer.
       (2) Additional preemption.--
       (A) In general.--No person other than the Attorney General 
     of a State may bring a civil action under the law of any 
     State if such action is premised in whole or in part upon the 
     defendant violating any provision of this Act.
       (B) Protection of consumer protection laws.--This paragraph 
     shall not be construed to limit the enforcement of any State 
     consumer protection law by an Attorney General of a State.
       (3) Protection of certain state laws.--This Act shall not 
     be construed to preempt the applicability of--
       (A) State trespass, contract, or tort law; or
       (B) other State laws to the extent that those laws relate 
     to acts of fraud.
       (b) Preservation of FTC Authority.--Nothing in this Act may 
     be construed in any way to limit or affect the Commission's 
     authority under any other provision of law, including the 
     authority to issue advisory opinions (under Part 1 of Volume 
     16 of the Code of Federal Regulations), policy statements, or 
     guidance regarding this Act.

     SEC. 7. ANNUAL FTC REPORT.

       For the 12-month period that begins upon the effective date 
     under section 11(a) and for each 12-month period thereafter, 
     the Commission shall submit a report to the Congress that--
       (1) specifies the number and types of actions taken during 
     such period to enforce sections 2(a) and 3, the disposition 
     of each

[[Page 20814]]

     such action, any penalties levied in connection with such 
     actions, and any penalties collected in connection with such 
     actions; and
       (2) describes the administrative structure and personnel 
     and other resources committed by the Commission for 
     enforcement of this Act during such period.

     Each report under this subsection for a 12-month period shall 
     be submitted not later than 90 days after the expiration of 
     such period.

     SEC. 8. FTC REPORT ON COOKIES.

       (a) In General.--Not later than the expiration of the 6-
     month period that begins on the date of the enactment of this 
     Act, the Commission shall submit a report to the Congress 
     regarding the use of tracking cookies in the delivery or 
     display of advertising to the owners and users of computers. 
     The report shall examine and describe the methods by which 
     such tracking cookies and the websites that place them on 
     computers function separately and together, and the extent to 
     which they are covered or affected by this Act. The report 
     may include such recommendations as the Commission considers 
     necessary and appropriate, including treatment of tracking 
     cookies under this Act or other laws.
       (b) Definition.--For purposes of this section, the term 
     ``tracking cookie'' means a cookie or similar text or data 
     file used alone or in conjunction with one or more websites 
     to transmit or convey personally identifiable information of 
     a computer owner or user, or information regarding Web pages 
     accessed by the owner or user, to a party other than the 
     intended recipient, for the purpose of--
       (1) delivering or displaying advertising to the owner or 
     user; or
       (2) assisting the intended recipient to deliver or display 
     advertising to the owner, user, or others.
       (c) Effective Date.--This section shall take effect on the 
     date of the enactment of this Act.

     SEC. 9. REGULATIONS.

       (a) In General.--The Commission shall issue the regulations 
     required by this Act not later than the expiration of the 6-
     month period beginning on the date of the enactment of this 
     Act. Any regulations issued pursuant to this Act shall be 
     issued in accordance with section 553 of title 5, United 
     States Code.
       (b) Effective Date.--This section shall take effect on the 
     date of the enactment of this Act.

     SEC. 10. DEFINITIONS.

       For purposes of this Act:
       (1) Cable operator.--The term ``cable operator'' has the 
     meaning given such term in section 602 of the Communications 
     Act of 1934 (47 U.S.C. 522).
       (2) Collect.--The term ``collect'', when used with respect 
     to information and for purposes only of section 3, does not 
     include obtaining of the information by a party who is 
     intended by the owner or authorized user of a protected 
     computer to receive the information pursuant to the owner or 
     authorized user--
       (A) transferring the information to such intended recipient 
     using the protected computer; or
       (B) storing the information on the protected computer in a 
     manner so that it is accessible by such intended recipient.
       (3) Computer; protected computer.--The terms ``computer'' 
     and ``protected computer'' have the meanings given such terms 
     in section 1030(e) of title 18, United States Code.
       (4) Computer software.--
       (A) In general.--Except as provided in subparagraph (B), 
     the term ``computer software'' means a set of statements or 
     instructions that can be installed and executed on a computer 
     for the purpose of bringing about a certain result.
       (B) Exception for cookies.--Such term does not include--
       (i) a cookie or other text or data file that is placed on 
     the computer system of a user by an Internet service 
     provider, interactive computer service, or Internet website 
     to return information to such provider, service, or website; 
     or
       (ii) computer software that is placed on the computer 
     system of a user by an Internet service provider, interactive 
     computer service, or Internet website solely to enable the 
     user subsequently to use such provider or service or to 
     access such website.
       (5) Commission.--The term ``Commission'' means the Federal 
     Trade Commission.
       (6) Damage.--The term ``damage'' has the meaning given such 
     term in section 1030(e) of title 18, United States Code.
       (7) Deceptive acts or practices.--The term ``deceptive acts 
     or practices'' has the meaning applicable to such term for 
     purposes of section 5 of the Federal Trade Commission Act (15 
     U.S.C. 45).
       (8) Disable.--The term ``disable'' means, with respect to 
     an information collection program, to permanently prevent 
     such program from executing any of the functions described in 
     section 3(b) that such program is otherwise capable of 
     executing (including by removing, deleting, or disabling the 
     program), unless the owner or operator of a protected 
     computer takes a subsequent affirmative action to enable the 
     execution of such functions.
       (9) Information collection functions.--The term 
     ``information collection functions'' means, with respect to 
     an information collection program, the functions of the 
     program described in subsection (b) of section 3.
       (10) Information service.--The term ``information service'' 
     has the meaning given such term in section 3 of the 
     Communications Act of 1934 (47 U.S.C. 153).
       (11) Interactive computer service.--The term ``interactive 
     computer service '' has the meaning given such term in 
     section 230(f) of the Communications Act of 1934 (47 U.S.C. 
     230(f)).
       (12) Internet.--The term ``Internet'' means collectively 
     the myriad of computer and telecommunications facilities, 
     including equipment and operating software, which comprise 
     the interconnected world-wide network of networks that employ 
     the Transmission Control Protocol/Internet Protocol, or any 
     predecessor or successor protocols to such protocol, to 
     communicate information of all kinds by wire or radio.
       (13) Personally identifiable information.--
       (A) In general.--The term ``personally identifiable 
     information'' means the following information, to the extent 
     only that such information allows a living individual to be 
     identified from that information:
       (i) First and last name of an individual.
       (ii) A home or other physical address of an individual, 
     including street name, name of a city or town, and zip code.
       (iii) An electronic mail address.
       (iv) A telephone number.
       (v) A social security number, tax identification number, 
     passport number, driver's license number, or any other 
     government-issued identification number.
       (vi) A credit card number.
       (vii) Any access code, password, or account number, other 
     than an access code or password transmitted by an owner or 
     authorized user of a protected computer to the intended 
     recipient to register for, or log onto, a Web page or other 
     Internet service or a network connection or service of a 
     subscriber that is protected by an access code or password.
       (viii) Date of birth, birth certificate number, or place of 
     birth of an individual, except in the case of a date of birth 
     transmitted or collected for the purpose of compliance with 
     the law.
       (B) Rulemaking.--The Commission may, by regulation, add to 
     the types of information specified under paragraph (1) that 
     shall be considered personally identifiable information for 
     purposes of this Act, except that such information may not 
     include any record of aggregate data that does not identify 
     particular persons, particular computers, particular users of 
     computers, or particular email addresses or other locations 
     of computers with respect to the Internet.
       (14) Suite of functionally related software.--The term 
     `suite of functionally related software' means a group of 
     computer software programs distributed to an end user by a 
     single provider, which programs are necessary to enable 
     features or functionalities of an integrated service offered 
     by the provider.
       (15) Telecommunications carrier.--The term 
     ``telecommunications carrier'' has the meaning given such 
     term in section 3 of the Communications Act of 1934 (47 
     U.S.C. 153).
       (16) Transmit.--The term ``transmit'' means, with respect 
     to an information collection program, transmission by any 
     means.
       (17) Web page.--The term ``Web page'' means a location, 
     with respect to the World Wide Web, that has a single Uniform 
     Resource Locator or another single location with respect to 
     the Internet, as the Federal Trade Commission may prescribe.

     SEC. 11. APPLICABILITY AND SUNSET.

       (a) Effective Date.--Except as specifically provided 
     otherwise in this Act, this Act shall take effect upon the 
     expiration of the 12-month period that begins on the date of 
     the enactment of this Act.
       (b) Applicability.--Section 3 shall not apply to an 
     information collection program installed on a protected 
     computer before the effective date under subsection (a) of 
     this section.
       (c) Sunset.--This Act shall not apply after December 31, 
     2009.

  The SPEAKER pro tempore (Mr. Fossella). Pursuant to the rule, the 
gentleman from Texas (Mr. Barton) and the gentlewoman from Illinois 
(Ms. Schakowsky) each will control 20 minutes.
  The Chair recognizes the gentleman from Texas (Mr. Barton).


                             General Leave

  Mr. BARTON of Texas. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and include extraneous material on H.R. 2929.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. BARTON of Texas. Mr. Speaker, I yield myself such time as I may 
consume.

[[Page 20815]]

  Mr. Speaker, today the House is considering legislation to protect 
consumers against Internet spying.
  Internet spying is all too common. Many consumers are totally unaware 
that even that their computers can be infected with programs that 
monitor their activity on the Internet and transfer private information 
to third parties. At the least, this private information is used to 
drive the annoying pop-up ads that we see when we turn on our 
computers. At its very worst, spyware is used by unscrupulous operators 
to steal financial information and even the individual who owns the 
computer's personal identity.
  The term spyware is used to describe a number of nefarious activities 
on the Internet, all involve spying or stealing information about 
consumers without their permission. These activities include: Key 
stroke logging, in which all of the computer user's key strokes are 
recorded and sent to a third party; homepage highjacking, in which 
spyware takes control of the computer, highjacks the individual user's 
homepage to a commercial or in some case a pornographic site; phishing, 
in which spyware directs false messages to computer users purporting to 
be from reputable merchants to steal credit card or other financial 
information from the user for the use of the third party.
  Spyware is downloaded on to a computer without the knowledge of the 
user. Computers can be infected just by visiting Web sites that cause 
spyware to be downloaded on to any computer visiting that site.
  We tested some of the computers in the Committee on Energy and 
Commerce. We discovered that these computers had been infected with 
many pieces of spyware, I believe the number was over 60, and that some 
of it did direct information to third parties about the use of those 
computer. All of this was done without any notice to the owners of 
those computers. I would also point out that this was done by getting 
through at least two fire walls, the House of Representatives' fire 
wall and the Committee on Energy and Commerce's fire wall.
  Technological development moves quickly, much faster than the 
regulatory or legislative process. It has taken the House 5 years to 
give regulators additional tools to combat spam, for instance. I am 
told that the Federal Trade Commission has not brought any cases 
against purveyors of spyware to date. Our reaction to spyware is the 
exception to this rule. In town meetings in my congressional district 
in Texas just this past August, my constituents unanimously expressed 
outrage at the brazenness of spyware and exhibited a strong desire for 
us to act as soon as possible against this insidious disease.
  Every Member that I have spoken with on both political parties wants 
to take action to fight spyware. Some have heard from constituents. One 
of our subcommittee chairmen experienced the effects of spyware 
firsthand when his own homepage was high-
jacked. Today, on a bipartisan basis, it is my hope that we will pass 
this legislation to combat spyware.
  The legislation before us would prohibit the sets of practices like 
high-
jacking a consumer's homepage. It would prohibit keystroke logging. It 
would prohibit sending ads that cannot be closed except by shutting 
down the computer. It would also provide for a prominent opt-in for 
consumers prior to downloading any monitoring software under that 
consumer's computer.
  I believe that consumers should be given notice and have the right to 
consent before monitoring software that collects information about them 
is added to their computers.
  The legislation before us would also require that monitoring software 
be easily disabled at the direction of the consumer. It would also 
provide for FTC, Federal Trade Commission, enforcement with significant 
monetary penalties for those who knowingly violate the act. While 
criminal penalties may be appropriate for the most egregious behavior, 
I believe we have an obligation to provide additional protection to 
consumers' online information by having these civil fines that the FTC 
would enforce.
  Importantly, the SPY ACT before us regulates information-collection 
programs. These are programs that have the capability to collect 
personally identifiable information and either transmit that 
information to a third party or use that information to deliver or 
display advertising on the computer. The SPY ACT requires companies 
that are sending ads to the computers to identify with each ad the 
information collection program that is generating the ad. With this 
disclosure, consumers will know who is bombarding them with ads and 
will be able to make their own decision as to whether they wish to be 
so bombarded.
  The SPY ACT sets up a uniform national rule. Internet commerce is 
inherently interstate in nature. We need one set of rules for such 
commerce. I want to commend a number of Members for their strong work 
on this bill. First of all, I would like to thank the bill's sponsor, 
the gentlewoman from California (Mrs. Bono). It is she who has taken 
the lead to introduce the bill last October when most of us, myself 
included, had little knowledge of exactly what spyware was. She has 
been a tireless educator to many of us on its dangers and has worked 
tirelessly to improve the bill. She has brought dynamic leadership on 
technology issues to the Committee on Energy and Commerce, and her 
commonsense approach on this legislation has brought the issue to the 
floor expeditiously. I want to commend her for her strong work.
  The gentleman from New York (Mr. Towns), the co-sponsor of the 
original legislation with the gentlewoman from California (Mrs. Bono), 
he too has been a great bipartisan partner in this project. He made 
important contributions to the areas of network- and computer-based 
security.
  The gentleman from Florida (Mr. Stearns), the chairman of the 
Subcommittee on Commerce, Trade and Consumer Protection has been a key 
leader on all privacy related issues in this Congress. He has held 
eight hearings on privacy matters in this Congress and worked with the 
gentlewoman from California (Mrs. Bono) and the gentleman from New York 
(Mr. Towns) to perfect the legislation that is before us today.
  I would also like to commend the gentleman from Michigan (Mr. 
Dingell), the ranking minority member and the gentlewoman from Illinois 
(Ms. Schakowsky) the ranking subcommittee member, for their excellent 
work at the subcommittee and full committee.
  We have had truly a bipartisan effort to perfect this legislation and 
bring it to the floor today. It shows what can happen when Members on 
both sides of the aisle work together towards a common purpose.
  The bill before us is a significant improvement on the original bill. 
And it is a result of the fine work that has been done by all Members 
on all sides of the aisle. This is a good bill. It has passed the 
Committee on Energy and Commerce overwhelmingly.
  Anybody who has held a town meeting on this can tell you 
automatically that our constituents are opposed to spyware and want us 
to do something to protect their privacy as soon as possible.
  Madam Speaker, I hope that we pass this overwhelmingly.
  Madam Speaker, I reserve the balance of my time.
  Ms. SCHAKOWSKY. Madam Speaker, I yield myself such time as I may 
consume.
  Madam Speaker, I rise today in support of a strong consumer and 
privacy protection bill, H.R. 2929, the Securely Protect Yourself 
Against Cyber Trespass Act or the SPY ACT.
  First, I would like to thank my colleagues, the gentleman from Texas 
(Mr. Barton), the ranking member, the gentleman from Michigan (Mr. 
Dingell), the gentleman from Texas (Mr. Stearns), the gentleman from 
New York (Mr. Towns) and the gentlewoman from California (Mrs. Bono), 
for their work on the SPY Act. I would like to commend them for the 
manner in which this bill was handled. The process was open. There was 
a sincere willingness to address each other's concerns and the work was 
organized around the goal of creating a strong and effective consumer 
protection bill. I think we have accomplished our goal.

[[Page 20816]]

  The SPY ACT is a bill whose time has come. As we have learned from 
our constituents, friends and family from our own experiences, people 
are increasingly finding that their home web pages have been changed or 
that their computers are sluggish. They will get pop-up ads that will 
not go away no matter how many times they try to close them. They find 
software on their computer that they did not install and that they 
cannot un-install. Their computers are no longer their own, and they 
cannot figure out why. They think that the problem is with their 
computer, with a faulty program they installed, or with their Internet 
service provider.
  But more and more often, it is becoming clear that they are the 
unwilling victims of spyware. Software that can collect personal 
information, track web usage and adversely effect computer performance. 
While some of the above examples may be written off as merely annoying, 
there are serious privacy and security issues at stake.
  The tracking capability of the software is so powerful that it can 
record every keystroke a computer user enters. It can snatch personal 
information from a consumer's hard drive. People can see their bank 
account numbers, passwords and other personal information stolen 
because they quite innocently went to a Web site or clicked an 
agreement which downloaded spy-
ware onto their computer.
  Although we do not want to stop legitimate uses of the underlying 
software, like allowing for access to online newspapers without having 
to register every time the Web site is visited, we do want consumers to 
know what is happening with their constitutes and personal information 
and to stop truly nefarious abuses of the programs, like keystroke 
logging which can track and transmit every keystroke entered to an 
unintended recipient.
  The SPY ACT ensures that consumers are protected from truly bad acts 
and actors while also preserving pro-consumer functions of the 
software. It prohibits indefensible uses of the software, like 
keystroke logging and homepage highjacking. Additionally, it gives 
consumers the choice to opt-in to the installation or activation of 
information-collection programs on their computer, programs that are 
not spyware, but only when the consumer knows exactly what information 
will be collected and what will be done with it.
  Furthermore, the SPY ACT gives the Federal Trade Commission the power 
it needs, on top of laws already in place, to pursue deceptive uses of 
the spyware. The SPY ACT puts the control of computers and privacy back 
in consumers' hands, and I am glad that I was able to be a part of the 
process that brought this bill to the floor today.
  Again, I thank my colleagues for this pro-consumer, pro-privacy and 
bipartisan piece of legislation.
  Madam Speaker, I reserve the balance of my time.
  Mr. BARTON of Texas. Madam Speaker, I yield 5 minutes to the 
gentleman from Florida (Mr. Stearns), the distinguished subcommittee 
chairman.
  Mr. STEARNS. Madam Speaker, I am pleased to support this legislation. 
I think it provides strong e-commerce protection, not through computer 
codes but rather through the U.S. legal code, for the American consumer 
and businesses large and small. And I would like to say at the very 
onset that we have support from the industry itself. Microsoft, Time 
Warner, Dell, Yahoo, eBay, the Business Software Alliance, Humana, 
EarthLink and several spyware companies themselves.
  The SPY ACT of 2004 takes dead aim at unwanted and sometimes 
malicious programs known as spyware that we all know can link and lurk 
in cyberspace. They corrupt and compromise computers and their networks 
and ultimately, Madam Speaker, they cost Americans and the economy 
major losses in time and money and productivity.
  The Federal Trade Commission loosely defines spyware as software 
``that aids in gathering information about a person or organization 
without their knowledge and that may send such information to another 
entity without the consumer's consent or that assert control over a 
computer without the consumer's knowledge.''
  The reality is that this deceptive and sometimes fraudulent activity, 
including the use of spyware, not only has the potential to damage 
consumer's confidence in e-commerce but also can be used to defraud 
consumers by stealing their personal financial information, quite 
literally, from underneath their noses. It is also alarming that 
estimates now show that these spyware programs have grown in number 
from about 2 million in August of 2003 to over 14 million today.
  The National Cybersecurity Alliance has estimated that over 90 
percent of users had some form of adware or spyware on their computers, 
and frankly, most of them were totally unaware of it. Given the gravity 
of this threat and its rapid growth, I am proud to say that the 
Committee on Energy and Commerce, Republicans and Democrats alike, as 
mentioned by the ranking member, have worked together in a bipartisan 
fashion. Oftentimes, we are on the House floor, we will be here 
probably the next couple of days, not in a bipartisan fashion, but we 
are here today, and it is a credit to the leadership for bringing this 
bill before us.
  Obviously, I think great credit goes to my colleague, the gentlewoman 
from California (Mrs. Bono) for her early leadership in this area and 
also working in a bipartisan method. I think a lot of credit goes to 
the gentleman from New York (Mr. Towns) for his early co-sponsorship. 
And I think our Subcommittee on Commerce, Trade and Consumer 
Protection, which I chair, and the gentlewoman from Illinois (Ms. 
Schakowsky) is the ranking member, also as she pointed out, worked 
together.
  I would also like to tell my colleagues, this is another good effort 
of our staffs, both Democrat and Republican, working together. The hard 
work of industry also should be commended because, obviously, when this 
bill first got started and we had our hearings, there were a lot of 
people in the industry that had some reservations.

                              {time}  1515

  We can only get through those reservations by having open-door 
communications with them and making the case of hard work with the 
staff and trying to get this free flow of communication, and I think in 
this case the staff is to be commended for making, as the chairman 
said, a good bill even better.
  As I mentioned to him, I have had many hearings dealing with privacy, 
and we have had a hearing on this. So H.R. 2929 would not only send a 
loud and clear message to those who would do harm to our computers but 
it also would add another layer of protection over the robust firewall 
and detection technology that the information technology industry is 
starting to provide consumers and businesses.
  In conclusion, Madam Speaker, I urge my colleagues to pass H.R. 2929, 
the SPY Act of 2000. It is time to put an end to spyware and keep 
Americans secure and confident in the e-commerce marketplace.
  Ms. SCHAKOWSKY. Madam Speaker, I would like to join the gentleman in 
thanking our staff, as well, for the hard work and the good work they 
did on bringing this legislation now to fruition.
  Madam Speaker, I yield 5 minutes to the gentleman from New York (Mr. 
Towns), one of the people most responsible for this consumer protection 
legislation.
  Mr. TOWNS. Madam Speaker, I rise in support of the SPY Act, which 
would greatly improve the privacy of consumers' online computer use.
  A lot of hard work has been put into this legislation. First and 
foremost, I would like to commend the gentlewoman from California (Mrs. 
Bono), the primary sponsor of the bill. Without her hard work, insight 
and persistence on this issue, we would not be here today. As the 
primary Democratic sponsor, I have been proud to work with her on this 
bill, and I salute her for all her efforts.
  I also want to commend the gentleman from Texas (Chairman Barton)

[[Page 20817]]

for his strong commitment to this issue and leadership in getting our 
bill to the floor. I would like to thank the gentleman from Florida 
(Chairman Stearns), the gentleman from Michigan (Ranking Member 
Dingell), and the gentlewoman from Illinois (Ranking Member 
Schakowsky), who have all made substantial contributions. I would also 
like to acknowledge all of the staff that have worked so hard to make 
this day a reality.
  There is no debate that spyware is a serious problem, one that is 
growing and becoming more harmful every day. Spyware software, which is 
downloaded without the computer owner's knowledge, invades our privacy 
by recording and transmitting personal information, monitoring the Web 
sites we visit, or even stealing documents from our computers. Other 
programs hijack our computers by changing our home page or forcing us 
to click through multiple screens until we download a spyware program.
  Today's legislation would give consumers new tools to prevent these 
harmful activities from happening. Under the bill, consumers would have 
to receive a clear and concise warning about the spyware program. 
Second, consumers would have to provide their affirmative consent 
before the program could operate on their computer. Finally, consumers 
must have the option to easily disable any harmful spyware program on 
their computer.
  While some consumers may want to share their information to receive 
free games or other discount offers, all consumers have the right to 
make that choice. This legislation would help ensure that consumers who 
do not want these programs secretly operating in the background, 
recording personal information, are not on their computers.
  Finally, Madam Speaker, any time we legislate on highly technical 
matters, there is always a danger in stifling innovation or making the 
use of legitimate software too burdensome. It is a very difficult 
tightrope to walk, but I think we have done an excellent job in walking 
that line. This bill addresses many of the concerns raised, while at 
the same time retaining meaningful notice and consent to protect 
consumers' privacy.
  This is a classic example of what we can accomplish when we work 
together, and we have worked together to make this day a reality. 
Through much hard work, we have carefully crafted a strong, bipartisan 
consumer protection bill; and I urge my colleagues to support this 
legislation because it is needed and needed desperately.
  Mr. BARTON of Texas. Madam Speaker, I want to thank the gentleman 
from New York who just spoke for his excellent leadership on this bill. 
It is a better bill because of his efforts.
  Madam Speaker, I yield 5 minutes to the distinguished gentlewoman 
from California (Mrs. Bono), who, along with the gentleman from New 
York (Mr. Towns), was an original cosponsor of the original bill.
  Mrs. BONO. Madam Speaker, first I would like to thank the gentleman 
from Texas for yielding me time and for his tremendous leadership on 
this issue, as well as all of the issues before the Committee on Energy 
and Commerce.
  I would also like to extend my gratitude to the gentleman from 
Michigan (Ranking Member Dingell), the gentleman from Florida (Chairman 
Stearns), a good friend, the gentlewoman from Illinois (Ranking Member 
Schakowsky) and the original cosponsor along with me, the gentleman 
from New York (Mr. Towns), who has been an absolute pleasure and 
delight to work with. I look forward to working with him on a lot more 
similar issues in the future.
  Each of the aforementioned colleagues of mine, as well as their 
staffs, have worked with me to improve and refine this bill. I also 
thank the industry participants and consumer groups who have 
contributed to its improvement. I am confident that we have drafted a 
bill that protects consumers without impeding the growth of technology.
  I would also like to thank all my staff and Jennifer Baird and Linda 
Valter for their tireless work.
  In the other body, Senators Burns, Wyden, and Boxer introduced S. 
2145, the SPY BLOCK Act, and the Senate Commerce Committee recently 
approved and reported the bill. I look forward to working with my 
Senate counterparts on this matter, as well as the FTC and the 
technology industry, which will hopefully work to educate consumers 
about the dangers surrounding spyware, as well as its nature.
  In California, my home State, Governor Schwarzenegger, recently 
signed an anti-spyware bill entitled the Consumer Protection Against 
Computer Spyware Act. This bill, similar to other State laws, varies 
from the proposed Federal legislation, making it all the more 
imperative that we act now to ensure there is a uniform standard 
available for consumers.
  Yesterday, Earthlink and Webroot just released their latest spyware 
audit, which reveals that after 3 million scans for spyware, 83.4 
million instances of spyware had been discovered. This is an average of 
26 traces of spyware per SpyAudit scan. Unfortunately, consumers 
regularly and unknowingly download software programs that have the 
ability to track their every move. Consumers are sometimes informed 
when they download such software. However, the notice is often buried 
in multithousand word documents that are filled with technical terms 
and legalese that would confuse even a high-tech expert. Moreover, 
there are some Web sites and e-mail messages which deliberately trick 
computer users.
  In response to the rapid proliferation of spyware, in July of 2003, 
together with the gentleman from New York (Mr. Towns), I introduced 
H.R. 2929, the Securely Protect Yourself Against Cyber Trespass Act. 
This bill prohibits such behavior by specifically outlawing Web 
hijacking, keystroke logging, drive-by downloads, phishing, and several 
other insidious behaviors.
  Additionally, H.R. 2929 establishes a simple notice regime so the 
computer users can make informed decisions regarding programs they wish 
to put on their computers. The PC has become our new town square and 
global market, as well as our private database. If a consumer downloads 
software that can monitor the information shared during transactions, 
for the sake of the consumer as well as e-commerce, it is imperative 
that the consumer be informed of whom he or she is inviting into their 
computer and what he or she is capable of doing. After being informed, 
a consumer should have the chance to decide whether to continue with 
that download.
  H.R. 2929 would require that all spyware companies give clear, 
concise and conspicuous notice to computer users about the function of 
their software, as well as the information that may be collected and 
transmitted through such software. After giving such notice, the 
computer user would have to agree to further download that software.
  Madam Speaker, I urge my colleagues to support H.R. 2929. Again, I 
thank the chairman and my colleagues on the other side of the aisle.
  Ms. SCHAKOWSKY. Madam Speaker, if I could inquire if there are any 
other speakers on the other side.
  Mr. BARTON of Texas. We think we have the gentleman from Michigan 
(Mr. Upton), subcommittee chairman, on his way; but other than that we 
have no other speakers.
  Ms. SCHAKOWSKY. Madam Speaker, I have no other speakers, and I yield 
back the balance of my time.
  Mr. BARTON of Texas. Madam Speaker, I yield myself the balance of the 
time.
  To close the debate, let me simply say I think we have seen in this 
debate not just the bipartisan support but the unanimous support this 
bill has. Whether my colleagues represent metropolitan New York City or 
the suburbs of Chicago or the hurricane-ravaged plains of Florida, the 
prairies of Texas, or Southern California, we are all hooked up to the 
Internet; and we all have constituents who are outraged that as they do 
their Internet shopping

[[Page 20818]]

and browsing and surfing, these insidious programs called spyware can 
infect their computers without their permission. Unfortunately, right 
now it is not even illegal.
  What this bill does is make it illegal, and it gives the Federal 
Trade Commission the authority to impose significant civil fines for 
using this spyware.
  I would also like to point out that thanks to the strong work of the 
committee staff on both sides of the aisle, we have a bill that the 
business community supports. Microsoft, the Software Business Alliance, 
Yahoo, Time Warner who owns AOL, they all support this. Ebay supports 
this bill. We are going to put those statements of support in the 
Record at this point.

                                                   TimeWarner,

                                               September 21, 2004.
     Hon. Joe Barton,
     Hon. John Dingell,
     House Energy and Commerce Committee, House of 
         Representatives, Rayburn House Office Building, 
         Washington, DC.
       Dear Chairman Barton and Representative Dingell: On behalf 
     of TimeWarner and its AOL division, I would like to express 
     our support for H.R. 2929, the Safeguard Against Privacy 
     Invasions Act, which was authored by Representatives Bono and 
     Towns and approved by your Committee in June.
       Battling spyware is one of AOL's top business and policy 
     priorities. Spyware is a growing concern for all Internet 
     users, wreaking havoc with consumers' computers and 
     undermining their online experience. We believe that spyware 
     must be addressed on many fronts, including through 
     legislation, technology, and consumer education.
       We have been pleased to work closely with the House Energy 
     and Commerce Committee over the past several months on this 
     legislation. H.R. 2929 will provide some important tools in 
     the fight against spyware, outlawing destructive behaviors 
     that can deceive and defraud consumers through the use of 
     unauthorized software. We appreciate all of the improvements 
     you have made and continue to make to this bill as it moves 
     through the process, and we are hopeful that, along with 
     legislation that has been approved by the Judiciary 
     Committee, it will soon be considered on the House Floor.
       The time is right for strong and effective federal spyware 
     legislation. We are grateful for the opportunity to work with 
     you and your Committee on this topic, and are eager to see 
     this bill move forward so that consumers and legitimate 
     businesses can enjoy additional anti-spyware protections in 
     the near future.
           Sincerely,

                                            Jennifer Jacobsen,

                                                   Vice President,
     Global Public Policy.
                                  ____



                                   Business Software Alliance,

                               Washington, DC, September 17, 2004.
     Hon. Joe Barton,
     Chairman, House Energy and Commerce Committee, Rayburn House 
         Office Building, Washington, DC.
       Dear Mr. Chairman: Thank you for your ongoing efforts to 
     advance America's high tech industries and protect the 
     interests of American consumers. We appreciate your 
     commitment and leadership.
       In particular, I write today to commend you for your 
     attention to addressing the growing problem of spyware and to 
     let you know that the Business Software Alliance endorses 
     your leadership in moving to secure approval of the Spy Act, 
     H.R. 2929, on the House floor this Congress. The manager's 
     amendment to the committee passed bill, which we understand 
     will be brought to the floor, is a step forward in the effort 
     to control the onslaught of harmful spyware that has proved 
     to be annoying at best and harmful at its worst to consumers 
     and businesses alike.
       Surreptitiously downloaded spyware inflicts significant 
     costs on our member companies as they are forced to help 
     their innocent customers identify and remedy the source of 
     parasitic encroachment on their computer systems. As an 
     association that represents the country's leading business 
     software and hardware makers, we know all too well the 
     dangers of harmful and deceptive spyware. We have heard from 
     our customers, just as you have from your constituents, that 
     this spyware is frustrating the user experience by hijacking 
     their personal property.
       I also want to commend you and your staff on the 
     development of the legislation. As you know, the initial 
     drafts raised concerns that the bill might target and punish 
     technologies rather than the bad behavior that has proved to 
     be so troublesome. I am pleased that you and your staff 
     provided an open and inclusive environment for us to share 
     our views and appreciate the improvements that have been made 
     to the legislation.
       As you know, successful legislation requires thoughtful 
     discussion, cooperation and compromise, and we understand the 
     important balance you have sought to achieve in moving this 
     process forward. We applaud your efforts, and BSA looks 
     forward to working with you and your staff as the bill 
     continues through the legislative process.
           Sincerely,
                                          Robert W. Holleyman, II,
     President and CEO.
                                  ____

                                               September 21, 2004.
     Hon. Joe Barton,
     Chairman, House Committee on Energy & Commerce, Rayburn House 
         Office Building, Washington, DC.
     Hon. John Dingell,
     Ranking Member, House Committee on Energy & Commerce, Rayburn 
         House Office Building, Washington, DC.
       Dear Chairman Barton and Congressman Dingell: On behalf of 
     eBay and its more than 100 million users worldwide, I want to 
     commend you for your bipartisan work on legislation intended 
     to combat Spyware on the Internet.
       We agree that the proliferation of so-called ``Spyware'' on 
     the Internet threatens to undermined consumers' online 
     experience and erode the overall value of the Internet. eBay 
     is always ready to work with lawmakers to come up with sound 
     legislation that prohibits invasions of privacy while 
     protecting legitimate activities we use to protect our 
     community and fight fraud. We believe the Energy & Commerce 
     Committee has worked hard to strike the necessary balance on 
     this important issue, and has gone to unprecedented lengths 
     to reach bipartisan consensus and work with industry leaders.
       One of eBay's highest priorities is to provide a safe and 
     well-lit place for our users to conduct business. That is why 
     we are pleased with the Committee's willingness to include a 
     provision exempting fraud detection and prevention activities 
     from the bill's requirements intended to deter Spyware. That 
     provision will allow us to continue to gather critical 
     information needed to protect our users when they trade on 
     eBay.
       Thank you for taking eBay's concerns into consideration in 
     developing balanced legislation to target nefarious behavior 
     on the Internet. We look forward to full House consideration 
     of this important legislation as soon as possible.
           Sincerely,

                                                 Tod H. Cohen,

                                                Associate General,
     Global Government Relations.
                                  ____



                                                  Humana Inc.,

                               Louisville, KY, September 15, 2004.
     Re H.R. 2929--the Safeguard Against Privacy Invasions Act.

     Hon. Joe Barton,
     Chairman, House Energy and Commerce Committee, Washington, 
         DC.
       Dear Chairman Barton: I wish to express my company's strong 
     support for the Committee-reported version of H.R. 2929, the 
     Safeguard Against Privacy Invasions Act, or SPY Act. This 
     legislation provides a meaningful opportunity to reduce the 
     amount of spyware and disruptive advertising that are 
     threatening to impair our day-to-day business applications. 
     Moreover, such reduction will enhance the protection of our 
     customers' personal information and improve their online 
     experience.
       Humana Inc., headquartered in Louisville, Kentucky, is one 
     of the nation's largest publicly traded health benefits 
     companies, with approximately 7 million medical members 
     located primarily in 19 states and Puerto Rico. We offer 
     coordinated health insurance coverage and related services--
     through traditional and internet-based plans--to employer 
     groups, government-sponsored plans and individuals. We have 
     approximately 13,000 employees.
       At Humana, we have experienced significant spyware-related 
     damage on our workstations. This includes computer-related 
     printing problems, inability to operate internal applications 
     like entering timesheets and expense reports, serious 
     performance degradation (slow response time), and the 
     inability to launch or use the Internet or our internal 
     intranet applications. We have numerous workstations that 
     have needed to be rebuilt because of spyware issues and 
     service calls where our technicians spend numerous hours 
     troubleshooting various spyware problems. We estimate that we 
     received approximately 300,000 individual pieces of malicious 
     spyware in the first quarter of 2004 alone (or approximately 
     5 percent of all transactions.)
       Not every associate or consumer has the sophistication 
     level of knowing what is or may not be installed on his or 
     her PC--causing spyware-related response time issues. As a 
     result, we believe that surreptitiously installed spyware 
     introduces very serious privacy concerns both at an 
     individual level and for corporations. Unknowingly being 
     spied upon seems to also introduce new types of concerns for 
     corporations, including protection of intellectual assets, 
     property, trade secrets, and competitive advantage 
     information.
       Additionally, as a company whose core business is to handle 
     our customers' most sensitive medical information, we 
     strongly support the concept that consumers need to be 
     meaningfully informed about how their personal information is 
     collected and used. And, we support their right to end that 
     relationship when they deem fit to do so. There is no such 
     thing as ``benign'' spyware.

[[Page 20819]]

       The health care industry continues to be one of the most 
     paper-intensive industries. In the past several years, we 
     have made great strides to move toward an electronic world. 
     E-commerce and the Internet in the health care industry have 
     reduced administrative costs, improved claims processing, and 
     hold the promise of improving patient care and quality 
     through concepts such as electronic medical records. The 
     proliferation of spyware and disruptive software threatens to 
     undermine consumers' confidence in the Internet and negate 
     the progress we have made and hope to make in the future. 
     Therefore we fully support moving forward with this important 
     legislation.
       In closing, we appreciate the opportunity to comment on 
     H.R. 2929, and look forward to assisting the Committee in any 
     way as this legislation moves forward.
           Sincerely,

                                             Bruce J. Goodman,

                                         Senior Vice President and
     Chief Service and Information Officer.
                                  ____



                                        Microsoft Corporation,

                               Washington, DC, September 22, 2004.
     Hon. Joe Barton,
     Chairman, House Energy and Commerce Committee, House of 
         Representatives, Washington, DC.
     Hon. John D. Dingell,
     Ranking Member, House Energy and Commerce Committee, House of 
         Representatives, Washington, DC.
       Dear Chairman Barton and Ranking Member Dingell: I am 
     writing to commend your leadership on H.R. 2929, the 
     ``Securely Protect Yourself Against Cyber Trespass Act'' or 
     the ``SPY ACT,'' and convey Microsoft's support for moving 
     the bill forward for consideration by the full House.
       Microsoft shares the goals of the members of the Energy and 
     Commerce Committee to protect consumers from deceptive 
     software (``spyware''). We agree: the fraudsters that use 
     deceptive software to prey on consumers must be stopped. We 
     appreciate your and your staff's tireless work toward 
     producing a bill that, as you put it, goes after the bad guys 
     but doesn't unnecessarily impede the good guys.
       Legislation is but one tool with which to wage the fight 
     against spyware. In addition to strong laws, Microsoft 
     strongly believes that technological solutions, consumer 
     awareness, best practices, and strong enforcement are all 
     critical elements of any effective strategy to help 
     unsuspecting consumers avoid being victimized by spyware.
       In particular, I want to express our appreciation for 
     working to address concerns with Section 3 of H.R. 2929 which 
     imposes notice and consent requirements to protect the 
     privacy of computer users. We appreciate the work of the 
     staff to understand potential consequences of such 
     requirements in instances where exchange of data is related 
     to the functionality of particular software applications or 
     where it would be reasonably expected by computer users.
       Finally, let me personally convey Microsoft's appreciation 
     for the opportunity to provide input to you and the committee 
     staff throughout this process. We would not have reached this 
     point without their diligence and serious consideration of 
     our feedback.
       Like any legislation of such complexity, there may be 
     additional areas that need to be clarified or enhanced. With 
     that in mind, we look forward to continuing to work in 
     partnership with you and the bipartisan committee staff 
     should such issues arise. Likewise, please do not hesitate to 
     call on us should you require our input or assistance.
       Thank you for the enormous amount of time and effort you 
     have devoted to this important effort.
           Sincerely,

                                               Jack Krumholtz,

                          Managing Director, Federal Gov. Affairs,
     Associate General Counsel.
                                  ____



                                                  Yahoo! Inc.,

                                               September 17, 2004.
     Hon. Joe Barton,
     Energy & Commerce Committee,
     2322 Rayburn House Office Building, Washington, DC.
       Dear Mr. Chairman, Yahoo! writes to support the latest 
     version of H.R. 2929 issued on September 10, 2004, and looks 
     forward to continuing to work with you as the bill proceeds 
     through the legislative process.
       You, Ranking Minority Member Dingell, Subcommittee Chairman 
     Stearns, Ranking Member Schakowsky, and co-authors of the 
     bill Representatives Bono and Towns and the respective staff, 
     have worked tirelessly to develop a bill that prohibits 
     ``spyware'' activities such as taking control of a user's 
     computer or modifying computer settings for the purposes of 
     causing damage. In addition, the bill gives users more 
     control over their online experience through enhanced notices 
     and features that can disable aspects software consumers may 
     find undesirable. The new requirements strike a balance 
     between allowing useful tools for computer users and 
     requiring reasonable changes to existing mechanisms to give 
     notice, consent, and to remove or disable software.
       Thank you for hearing our concerns, responding to them 
     accordingly, and giving consumers and legitimate businesses 
     hope that the spyware problem can be, in part, addressed by 
     new tools for consumers and the new deterrent penalties in 
     H.R. 2929.
           Sincerely,
                                                    John Scheibel,
     Vice President for Public Policy.
                                  ____



                            United States Telecom Association,

                                   Washington, DC, August 4, 2004.
     Hon. Dennis Hastert,
     House of Representatives,
     Washington, DC.
       Dear Mr. Speaker: On behalf of the United States Telecom 
     Association (``USTA''), I am writing to express our support 
     of H.R. 2929, the Safeguard Against Privacy Invasions Act. 
     USTA was grateful for the opportunity afforded by members of 
     the House Commerce Committee specifically Chairman Barton, 
     Representatives Stearns, Upton, Bono, Dingell Towns, and 
     Schakowsky and their staff to participate and comment on this 
     legislation. USTA represents over 1,200 member companies that 
     offer a wide range of services, including local exchange, 
     long distance, wireless, Internet and cable television 
     service.
       H.R. 2929 recognizes appropriately the role of 
     telecommunications carriers as it relates to network 
     integrity, security and the transmission of information. In 
     late June, the House Commerce Committee voted 45-4 to send 
     this legislation to the full House and it is our hope that it 
     will be considered in the coming weeks.
       Again, thank you for all you do on behalf of the 
     telecommunications industry. Please do not hesitate to 
     contact me if I may be of service to you or your staff.
           Sincerely,
                                          Walter B. McCormick, Jr.
     President and Chief Executive Officer.
                                  ____



                                                        WhenU,

                                 New York, NY, September 20, 2004.
     Re H.R. 2929.

     Hon. Joe Barton,
     Chairman, Committee on Energy and Commerce, House of 
         Representatives, Washington, DC.
       Dear Chairman Barton: WhenU.com is a global Desktop 
     Advertising Network. Through the Company's partnerships with 
     popular software developers, WhenU enables consumers to 
     receive valuable software for free by agreeing to see 
     occasional ads instead of paying a fee--and without 
     compromising their privacy. WhenUs's unique advertising 
     technology distinguishes itself from existing online 
     advertising approaches by applying sophisticated precision 
     logic at the desktop level. From the desktop, WhenU software 
     examines keywords, URLs and search terms currently in use on 
     the consumer's browser and then selects relevant and useful 
     advertisements. WhenU accomplishes this in a highly privacy 
     protective manner and avoids collecting any browsing data--
     even anonymously--about individual users. The WhenU Desktop 
     Advertising Network does not track user or clickstream data, 
     use cookies, compile a centralized database of users, or 
     engage in any type of user profiling.
       I am writing to first express my appreciation to you, 
     Chairman Stearns, and Representatives Bono, Schakowsky and 
     Towns, among others, and to the bipartisan Energy and 
     Commerce Committee staff led by David Cavicke, for the 
     opportunity to work with the Committee to help perfect H.R. 
     2929. It has been a gratifying, productive and successful 
     process. I am pleased today to state that WhenU supports the 
     September 10 version of H.R. 2929. We are particularly 
     pleased with the bill's treatment of state pre-emption 
     issues. We believe that the September 10 version of H.R. 2929 
     strikes a reasonable balance that should succeed in 
     protecting consumers, eliminate bad actors, and enable 
     legitimate businesses to continue to provide useful and 
     meaningful e-commerce solutions for the country.
           Sincerely,
                                                       Avi Naider,
     Chief Executive Officer.
                                  ____



                                                 180solutions,

                                 Bellevue, WA, September 17, 2004.
     Hon. Joe Barton,
     Chairman, Committee on Energy and Commerce, Rayburn House 
         Office Building, House of Representatives, Washington, 
         DC.
       Dear Mr. Chairman. 180solutions is a leading provider of 
     Internet search marketing software, offering consumers access 
     to a wide range of free content in return for their agreement 
     to be shown a limited number of websites each day selling 
     goods or services--most often at times when they are likely 
     shopping for those goods or services online. We use keyword 
     search technology to deliver these highly targeted websites 
     to consumers on behalf of over 6,000 advertisers, including 
     many top-tier companies whose brands are household names.
       We are writing to express our company's support for House 
     passage of H.R. 2929 in the form of the Managers' Amendment 
     dated September 10, 2004. During the course of this 
     legislation's consideration in the Energy and Commerce 
     Committee, it has continually evolved and improved to allow 
     legitimate companies like ours to assist consumers in their 
     search for advantageous and competitive sales offers online, 
     while protecting computer users and owners from the deceptive 
     or fraudulent acts or practices often associated with 
     spyware. We are also deeply

[[Page 20820]]

     appreciative of the open process by which the bill has been 
     developed and commend the Members and staff on both sides of 
     the aisle for working with all stakeholders to that end.
       As you may know, we had hoped the legislation would deal 
     more with tracking cookies, but we recognize that the issue 
     is complex and thus has become controversial. The Federal 
     Trade Commission report provided for by section 8 of the 
     Managers' Amendment is a good compromise that will foster 
     further discussion on the basis of sound and unbiased 
     analysis.
       Thank you again for your consideration of our views and for 
     your careful crafting of this legislation.
           Sincerely,
                                                      Keith Smith,
                                          Chief Executive Officer.

  This is one of those rare times when the House of Representatives 
probably is not ahead of the curve, but we are at least catching up 
with the curve to end something and to police something that every one 
of our constituents who is on the Internet is absolutely opposed to.
  So Madam Speaker, I ask for a strong ``aye'' vote on this bill.
  Mr. SHAYS. Madam Speaker, I want to express support for two bills the 
House is considering this week: H.R. 2929, the Safeguard Against 
Privacy Invasions Act, and H.R. 4661, the Internet Spyware I-SPY 
Prevention Act. I strongly support these pieces of legislation and I am 
pleased they incorporate changes similar to legislation Congressman Jay 
Inslee and I introduced, H.R. 4255, the Computer Software Privacy and 
Control Act.
  Millions of computers have been infected with spyware, software that 
is deceptively installed on their computers to collect their personal 
information, record their keystrokes, change their browser homepage, or 
display unwanted advertising.
  H.R. 2929 would require notice and consent from the computer user 
before software is able to collect personal information and transmits 
it to a third party, monitor Internet usage, such as websites visited, 
modify computer settings or deliver advertisements. This provision 
accomplishes a main goal of the Computer Software Privacy and Control 
Act.
  H.R. 4661 strengthens criminal provisions in the Computer Fraud and 
Abuse Act. Providing necessary criminal penalties for spyware will help 
prevent this deceptive activity and protect the privacy of consumers. 
Our legislation includes provisions similar to this as well.
  I am glad H.R. 2929 and H.R. 4661 require notice and consent and 
strengthen criminal provisions, and I urge my colleagues to support 
these important pieces of legislation.
  Mr. GOODLATTE. Madam Speaker, I rise today to discuss H.R. 2929, the 
``Safeguard Against Privacy Invasions Act.''
  I believe that there is a need to impose appropriate civil penalties 
against those who use software to commit egregious acts against 
computer users. In that respect, the provisions in H.R. 2929 that 
impose civil penalties on the truly bad actors, including those who use 
spyware to take over a user's computer to send spam, or those who 
engage in keystroke logging to steal personal information, are a step 
in the right direction.
  However, I also have concerns that portions of the bill cast too wide 
a net and that they would have unintended consequences that could 
penalize the legitimize software companies that are actually trying to 
play by the rules. Many provisions of this bill would not only 
encompass spyware, but also legitimate interactive software services. I 
oppose the provisions of this bill that stretch beyond punishing the 
truly bad actors and instead create a static regulatory regime in an 
industry that is always innovating and changing to respond to consumer 
demand.
  Also, imposing a notice and consent requirement for most software 
that is loaded onto computers could create unintended consequences. 
Specifically, when consumers are faced with the multiple notices that 
would be required under this bill, they will likely become desensitized 
and stop reading the disclosure altogether. The result could be a 
heavy-handed regulation that does not even achieve the desired goals of 
informing consumers and protecting them from spyware, especially since 
the truly bad actors are likely to simply ignore these regulations.
  I have introduced legislation, H.R. 4661, the Internet Spyware I-SPY 
Prevention Act, which impose tough criminal penalties on the most 
egregious purveyors of spyware without imposing a broad regulatory 
regime on legitimate software providers. I believe that this more 
targeted approach is the best way to combat spyware.
  While I have serious reservations about many portions of H.R. 2929, I 
also believe that it contains many civil prohibitions that would help 
in the fight against spyware. I support this bill, not in its entirety, 
but as an acknowledgement that some civil penalties are appropriate in 
the fight against spyware when properly targeted. However, I remain 
concerned about the broad regulatory aspects of this legislation, and 
hope to continue working to ensure that the final legislation is 
appropriately targeted at the truly bad actors, and that it does not 
cast a broad regulatory burden on those who continue to innovate and 
create new and exciting services in the interactive software industry.
  Ms. JACKSON-LEE of Texas. Madam Speaker, I join my colleagues today 
to support H.R. 2929. Persistent computer security vulnerabilities may 
expose U.S. critical infrastructure and government computer systems to 
possible cyber attack by terrorists, possibly affecting the economy or 
other areas of national security. Because of the ubiquitous nature of 
the Internet, unprotected home computers--often lacking network 
security features, could be the entree for cyber attacks. Even when 
national security is not at issue, spyware programs could be used to 
harvest personal informaiton--such as bank or credit card account 
number and e-mail addresses--from computers. This information could be 
used subsequently in fraudulent criminal activities or in the sending 
of unauthorized SPAM e-mail messages.
  Unwanted spyware programs can make changes to a computer that can be 
annoying and can cause the computer to slow down or crash. These 
programs have the ability to change the home page of a computer user's 
Web browser or search page, or add additional components to the browser 
that are unnecessary or unwanted. These programs could make it very 
difficult to change the settings back to the way they were originally.
  This bill directs the Federal Trade Commission (FTC) to prohibit the 
transmission of an unauthorized spyware program to a covered computer 
over the Internet. The bill further establishes requirements for an 
affirmative agreement by the user of the covered computer to 
specifically agree the conditions of the transmission with an 
acknowledgement of the person and address of the transmitter.
  The bill provides specific prohibitions on use of any spyware program 
for collecting any personally identifiable information from the covered 
computer unless notice is provided. The criminal penalties provided for 
in this act will help to provide a necessary enforcement mechanism.
  I believe this is just one of the steps necessary to secure the 
nation's critical infrastructure and to help protect the privacy and 
civil liberties of Americans.
  Mr. DINGELL. Madam Speaker, ``Barbarians At the Digital Gate'' 
recently warned the front page of the Sunday New York Times Business 
Section. What elicited this alarming headline? Pernicious computer 
software commonly called ``spyware'' and ``adware''.
  These programs sneak onto your computer, and allow a third party to 
harvest your personal information. It is the equivalent of putting a 
wiretap on your phone and listening to your conversations. Adware 
tracks your Web surfing or online shopping so that marketers can send 
you unwanted ads. Spyware can hijack your computer to pornographic or 
gambling sites, or steal your passwords and credit card information.
  The rapid proliferation of spyware and adware has brought Internet 
use to a crossroads. It threatens legitimate Internet commerce. 
Consumer complaints are deluging computer call centers and regulators. 
The most common complaints are: hijacked home pages, redirected Web 
searches, a flood of pop-up ads, and sluggish and crashed computers.
  The bill, as amended, prohibits a number of deceptive acts or 
practices related to spyware, and provides for FTC enforcement and 
enhanced civil fines. It also recognizes that there are legitimate 
applications of spyware and, thus, exempts law enforcement, national 
security, network security, diagnostics and repair, and fraud detection 
from the SPY Act. It is a carefully balanced bill.
  Most importantly, this legislation contains opt-in protection for 
consumers. It requires companies that distribute spyware and adware to 
obtain permission from consumers through an easily understood licensing 
agreement before installing spyware or adware on their computers. The 
programs, once downloaded, would have to provide a means to identify 
the spyware or adware and easily uninstall or disable it.
  I also note that without aggressive enforcement, the goals of this 
bill will not be met. We are asking the FTC to do a great deal in a 
very complex area and I trust that the appropriators will provide them 
with sufficient resources to fulfill these tasks.
  This legislation is supported by a coalition that includes: the 
Business Software Alliance,

[[Page 20821]]

the Center For Democracy and Technology, the Council for Marketing and 
Opinion Research, Dell, eBay Inc., Humana Inc., Microsoft, 180 
Solutions, Time Warner/AOL United States Telecom Association, WhenU, 
and Yahoo!--all of whom have submitted letters of support.
  The bill has improved at every stage of its consideration, and I want 
to commend the leadership and hard work of Rep. Barton, the Chairman of 
the Committee on Energy and Commerce, Reps. Stearns and Schakowsky, the 
Chairman and Ranking Member, respectively, of the Commerce, Trade, and 
Consumer Protection Subcommittee, and Reps. Bono and Towns, the lead 
Republican and Democrat sponsors of the bill. I also commend the 
bipartisan staff team who worked very hard over the last five months to 
get this bill to the Floor this year; David Cavicke, Shannon Jacquot, 
Crhis Leahy, Brian McCullough, Will Carty, Jennifer Baird, Consuela 
Washington, Diane Beedle, and Andrew Delia.
  I urge my Colleagues to vote ``yes'' on passage of H.R. 2929. It is a 
good bill. It's good for consumers. And it is good for honest commerce 
on the Internet.
  Mr. GREEN of Texas. Madam Speaker, my interest in the consumer 
problem of spyware stems from many years of work on the consumer spam 
problem.
  The anti-spam law was not expected to eliminate unwanted email, but 
it did draw a line for consumers--that some kinds of privacy invasion 
are not allowed. Internet Service Providers like Microsoft, AOL, Yahoo, 
and Earthlink along with State Attorney Generals are bringing serious 
actions against spammers who violate the law.
  Spyware and illegal spam are not just problems of privacy and 
convenience, both can be the cause of viruses and other computer 
crimes.
  Just like robbery and speeding have not been eliminated, neither will 
spam or spyware. But when something is harming social welfare and 
consumers are overwhelmed, and private sector solutions are not enough, 
then we need an enforceable standard.
  This legislation prohibits the most commonly known deceptive acts and 
practices related to Spyware from tracking your web surfing habits to 
send you advertising to hijacking your passwords and credit care 
numbers.
  However, while some use this technology to deceive and defraud us, 
this technology is also used to support our efforts in national 
security. This important use of technology is taken into consideration 
by this bill and exempts law enforcement, national security agencies, 
network security programs and diagnostics on repairs to our computers 
from the SPY Act.
  In addition, state attorney generals will have the ability to enforce 
consumer protection laws against spyware and preserves state trespass, 
contract tort and fraud laws.
  This legislation will draw a line that spying on Americans' computers 
will not be tolerated. Will some people continue to get away with it? 
Perhaps. But will some people be prosecuted and punished for violating 
our privacy? Absolutely.
  Mr. BARTON of Texas. Madam Speaker, I yield back the balance of my 
time.
  The SPEAKER pro tempore (Mrs. Miller of Michigan). The question is on 
the motion offered by the gentleman from Texas (Mr. Barton) that the 
House suspend the rules and pass the bill, H.R. 2929.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. BARTON of Texas. Madam Speaker, on that I demand the yeas and 
nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

                          ____________________