[House Report 107-41]
[From the U.S. Government Publishing Office]



107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                            107-41, Part II

======================================================================



 
                       ANTI-SPAMMING ACT OF 2001

                                _______
                                

                  June 5, 2001.--Ordered to be printed

                                _______
                                

 Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 718]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on the Judiciary, to whom was referred the bill 
(H.R. 718) to protect individuals, families, and Internet 
service providers from unsolicited and unwanted electronic 
mail, having considered the same, reports favorably thereon 
with an amendment and recommends that the bill as amended do 
pass.

                                CONTENTS

                                                                   Page
The Amendment....................................................     2
Purpose and Summary..............................................     3
Background and Need for the Legislation..........................     3
Congressional Research Service Memorandum Regarding the 
  Constitutionality of the Hart Amendment........................    10
Hearings.........................................................    15
Committee Consideration..........................................    16
Votes of the Committee...........................................    16
Committee Oversight Findings.....................................    18
Performance Goals and Objectives.................................    18
New Budget Authority and Tax Expenditures........................    18
Congressional Budget Office Cost Estimate........................    18
Constitutional Authority Statement...............................    20
Section-by-Section Analysis......................................    20
Changes in Existing Law Made by the Bill, as Reported............    21
Markup Transcript................................................    23
Additional Views.................................................   103
  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Anti-Spamming Act of 2001''.

SEC. 2. SPAMMING PROHIBITIONS.

  (a) In General.--Part I of title 18, United States Code, is amended 
by inserting after chapter 29 the following:

                     ``CHAPTER 30--ELECTRONIC MAIL

``Sec.
``621. Unsolicited commercial electronic mail containing fraudulent 
transmission information.
``622. Warning labels for electronic mail containing advertisements 
harmful to minors.

``Sec. 621. Unsolicited commercial electronic mail containing 
                    fraudulent transmission information

  ``(a) Whoever intentionally initiates in one or more transactions the 
transmission of 10 or more unsolicited commercial electronic mail 
messages to one or more protected computers in the United States, 
knowing that each such message contains or is accompanied by header 
information that is materially false or misleading as to the identity 
of the person initiating the transmission shall be fined under this 
title, and in the case of an offense under this section which occurs 
after conviction for a prior offense under this section, shall be so 
fined or imprisoned not more than one year, or both.
  ``(b) As used in this section--
          ``(1) the term `commercial electronic mail message' means an 
        electronic mail message the primary purpose of which is to 
        advertise or promote, for a commercial purpose, a product or 
        service (including content on an Internet website);
          ``(2) the term `header information' means the source, 
        destination, and routing information, including the originating 
        domain name and originating electronic mail address; and
          ``(3) the term `protected computer' has the meaning given 
        that term in section 1030(e)(2) of this title.
  ``(c)(1) A provider of Internet access service, if otherwise 
permitted by the laws or rules of a court of a State, may bring in an 
appropriate court of that State, or, if such laws or rules do not so 
permit, may bring in an appropriate Federal court, an action to recover 
for actual or statutory damages, as provided in paragraph (2), and for 
costs, as provided in paragraph (4).
  ``(2) A person committing a violation of subsection (a) is liable to 
a provider of Internet access service for either--
          ``(A) the actual damages suffered by the provider of Internet 
        access service; or
          ``(B) statutory damages, as provided in paragraph (3).
  ``(3) At any time before final judgment in an action, a provider of 
Internet access service may elect to recover an award of statutory 
damages for each violation of subsection (a) in the sum of $5 per 
violation, not to exceed a total of $1,000,000, except that, during any 
one-year period for which the defendant has transmitted in excess of 
20,000,000 unsolicited commercial electronic mail messages, no such 
limit on liability shall exist.
  ``(4) In any action brought under paragraph (1), the court may award 
to a prevailing party reasonable litigation expenses incurred by that 
party, including reasonable attorney's fees, as a part of the costs 
awarded under section 1920 of title 28 against any party found in that 
action to have committed a violation of subsection (a).

``Sec. 622. Warning labels for electronic mail containing 
                    advertisements harmful to minors

  ``(a)(1) The Attorney General shall prescribe marks or notices to be 
included in electronic mail that contains a sexually oriented 
advertisement in order to inform the recipient of that fact.
  ``(2) Whoever, in any electronic mail that is carried on an 
instrumentality in or affecting interstate or foreign commerce, 
knowingly includes a sexually oriented advertisement but does not 
include in such electronic mail the marks or notices prescribed by the 
Attorney General under this section shall be fined under this title or 
imprisoned not more than one year, or both.
  ``(b) As used in this section, the term `sexually oriented 
advertisement' means any advertisement that depicts, in actual or 
simulated form, or explicitly describes, in a predominantly sexual 
context, human genitalia, any act of natural or unnatural sexual 
intercourse, any act of sadism or masochism, or any other erotic 
subject directly related to the foregoing, but material otherwise 
within the definition of this subsection shall be deemed not to 
constitute a sexually oriented advertisement if it constitutes only a 
small and insignificant part of the whole, the remainder of which is 
not primarily devoted to sexual matters.''.
  (b) Clerical Amendment.--The table of chapters at the beginning of 
part I of title 18, United States Code, is amended by inserting after 
the item relating to chapter 29 the following new item:

``30. Electronic mail.......................................     621''.

SEC. 3. STUDY OF EFFECTS OF UNSOLICITED COMMERCIAL ELECTRONIC MAIL.

  Not later than 18 months after the date of the enactment of this Act, 
the Attorney General shall submit a report to the Congress that 
provides a detailed analysis of the effectiveness and enforcement of 
the provisions of this Act and the need (if any) for the Congress to 
modify such provisions.

                          Purpose and Summary

    The amendment in the nature of a substitute adopted by the 
Committee completely replaces the text of H.R. 718. It is a 
bipartisan targeted approach to address two specific problems 
relating to unsolicited commercial electronic mail (``UCE''). 
First, the amendment makes it illegal to conceal the identity 
of the sender of the e-mail. This misdemeanor prohibition is 
necessary because unscrupulous individuals conceal what is 
known as point-of-origin, routing or header information in 
order to defeat the preferences and filtering mechanisms 
employed by Internet service providers (``ISPs'') and computer 
users. Furthermore, those who peddle schemes to defraud 
individuals, such as get-rich-quick schemes, and transmit 
pornography via e-mail often conceal the origin of the e-mail 
in furtherance of their unscrupulous desire to swindle 
consumers or entice them to purchase pornography over the 
Internet. There is no legitimate reason to falsify the header 
information accompanying commercial e-mail.
    The second problem addressed by the amendment is 
unsolicited pornography sent via e-mail. This problem is 
addressed by the Hart amendment which was offered by 
Representative Melissa Hart. This provision directs the 
Attorney General to prescribe marks to be included in all 
pornographic e-mail. The amendment is modeled after a long-
standing postal statute, 39 U.S.C. Sec. 3010, which mandates 
that marks be included on the envelope of pornographic material 
sent through the United States Postal Service. This provision 
will allow users to delete pornographic material without 
viewing its contents and will assist parents in screening or 
filtering out unwanted pornographic e-mail, thereby protecting 
children from receiving and viewing pornography contained or 
accompanying e-mail. In short, a recipient of a pornographic e-
mail will now have the ability to utilize technology to 
automatically do the equivalent of throwing out unopened junk 
mail.

                Background and Need for the Legislation

                       Jurisdiction and Procedure

    H.R. 718, the ``Unsolicited Commercial Electronic Mail Act 
of 2001'' was introduced by Rep. Heather Wilson on February 14, 
2001, and was referred to the Committee on Energy and Commerce 
and the Committee on the Judiciary for a period to be 
subsequently determined by the Speaker. The Committee on Energy 
and Commerce ordered the bill, as amended, reported on March 
28, 2001. On March 29, 2001, the Committee on the Judiciary 
requested that its referral be extended to June 5, 2001.\1\ The 
Committee on Energy and Commerce subsequently filed its report 
on April 4, 2001.\2\ On that day, the Speaker granted an 
extension to the Judiciary Committee ending not later than June 
5, 2001.
---------------------------------------------------------------------------
    \1\ See Letter from the Honorable F. James Sensenbrenner to the 
Honorable Dennis Hastert, Jr., March 29, 2001.
    \2\ See Unsolicited Commercial Electronic Mail Act of 2001, H. 
Rept. 107-41, Part 1 (April 4, 2001) (hereinafter ``Commerce Report'').
---------------------------------------------------------------------------
    H.R. 718 was referred to the House Judiciary Committee 
because a number of provisions fall within the Committee's Rule 
X jurisdiction, including:

         Section 1--Short Title;

         Section 2--Congressional Findings and Policy;

         Section 3--Definitions--including paragraphs 
        (4), (5), (8), (9), and (12);

         Section 4--Criminal Penalty for Unsolicited 
        Commercial Electronic Mail Containing Fraudulent 
        Routing Information;

         Section 5(c)--Internet Service Provider 
        Immunity Provision;

         Section 6(a)(5)--Enforcement by Court Order;

         Section 6(b)--Private Right of Action;

         Section 7--Effect on Other Laws;

         Section 8--Study of Effects of Unsolicited 
        Commercial Electronic Mail;

         Section 9--Separability; and

         Section 10--Effective Date.

    The amendment in the nature of a substitute adopted by the 
House Committee on Commerce contained several additional 
provisions that fall within the Committee's jurisdiction, 
including, a prohibition on class action lawsuits (section 
6(b)(4)) and a provision authorizing state attorneys general to 
file suit on behalf of their citizens (section 6(c)). The 
Committee also has pending before it H.R. 1017, the ``Anti-
Spamming Act of 2001,'' introduced by Rep. Bob Goodlatte, and 
H.R. 95, the ``Unsolicited Commercial Electronic Mail Act of 
2001,'' introduced by Rep. Gene Green. The Committee reviewed 
H.R. 1017 and H.R. 718 in depth at its May 10, 2001, hearing.

               Regulation of Electronic Commerce and Spam

    The increased use of the Internet for electronic commerce 
is desirable. In fact, the Congress has encouraged, through 
such measures as the ``Electronic Signatures in Global and 
National Commerce Act,'' \3\ the full use of the Internet to 
conduct business. Businesses use e-mail, much like the regular 
mail, to market their products and services. E-mail marketing 
is viewed by many as a necessary component of electronic 
commerce. The market efficiencies that the Internet can provide 
consumers is facilitated by providing consumers with product 
information, notices about specials and discounts, and other 
wanted consumer information.
---------------------------------------------------------------------------
    \3\ P.L. 106-229.
---------------------------------------------------------------------------
    Electronic commerce is still in its infancy. Business 
models are constantly changing to find the right formula for 
success over the Internet. Electronic commerce is currently 
experiencing a number of difficulties. For example, banner ad 
revenue has fallen dramatically and many Internet companies 
have or are going out of business or filing for bankruptcy.
    Marketing, no matter how annoying, is integral to the 
success of commerce, including electronic commerce. Members on 
both sides of the aisle have raised serious concerns about 
regulating e-mail marketing and its impact on the growth of 
commerce. The Committee, in adopting its position, has chosen a 
cautious approach regarding the regulation of electronic 
commerce, particularly given this era of great technological 
and market change.
    Like any new technology, the Internet brings with it some 
challenges. One such challenge is the use of e-mail to deceive, 
cheat, defraud, and swindle consumers. Additionally, some mass 
commercial and non-commercial e-mailers send pornography to 
unwilling recipients. Some see the increased use of e-mail, 
particularly UCE (also known as ``spam'' or ``junk e-mail''), 
as intrusive, annoying, and costly to consumers and ISPs.
    The debate about spam is often complicated because policy 
makers often confuse or don't understand what constitutes spam. 
The term ``spam'' is used to encompass a number of different 
practices, some criminal, some annoying, and some benign. E-
mail fraud, e-mail pornography, and e-mail marketing are all 
often erroneously lumped into the same category. They are 
demonstrably different, and the amendment adopted by the 
Committee recognizes those differences.

                Fraudulent and Deceptive E-mail Content

    There are generally two types of fraudulent or deceptive e-
mail. The first is e-mail that makes fraudulent claims, such as 
the typical pyramid or other get-rich-quick scheme which is 
intended to deceive, cheat, defraud, or swindle consumers. This 
type of fraud falls directly under existing laws such as 
section 5(a) of the Federal Trade Commission Act \4\ or the 
Federal wire fraud statute.\5\ In addition, the Computer Fraud 
and Abuse Act \6\ provides the Federal Government with the 
statutory authority to investigate and prosecute those involved 
in damaging computers or accessing them without authorization.
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    \4\ 15 U.S.C. Sec. 45(a).
    \5\ 18 U.S.C. Sec. 1343.
    \6\ 18 U.S.C. Sec. 1030.
---------------------------------------------------------------------------
    On April 26, 2001, the Federal Trade Commission (``FTC''), 
testified before the Senate Subcommittee on Communications of 
the Committee on Commerce, Science and Transportation about 
their efforts to address fraudulent UCE. Since 1994, when the 
FTC first filed an enforcement action against deception on the 
Internet, the Commission has brought 173 law enforcement 
actions against more than 575 defendants to halt online 
deception and fraud. Regarding deception and fraud, the FTC 
testified as follows:

        By no means is all UCE is [sic] fraudulent, but fraud 
        operators, who are often among the first to exploit any 
        technological innovation, have seized on the Internet's 
        capacity to reach literally millions of consumers 
        quickly and at a low cost through UCE. Not only are 
        fraud operators able to reach millions of individuals 
        with one message, but they can misuse the technology to 
        conceal their identity. Many spam messages contain 
        false information about the sender and where the 
        message was routed from, making it nearly impossible to 
        trace the UCE back to the actual sender. In the same 
        vein, UCE messages also often contain misleading 
        subject lines and extravagant earnings or performance 
        claims about goods and services. These types of claims 
        are the stock in trade of fraudulent schemes.

        Bulk UCE burdens (indeed, sometimes cripples) Internet 
        service providers and frustrates their customers. The 
        FTC's main concern with UCE, however, is its widespread 
        use to disseminate false and misleading claims about 
        products and services. The Commission believes the 
        proliferation of deceptive bulk UCE on the Internet 
        poses a threat to consumer confidence in online 
        commerce and thus views the problem of deception as a 
        significant issue in the debate over UCE.\7\
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    \7\ Written testimony of the Federal Trade Commission submitted to 
the Senate Subcomm. on Communications of the Senate Comm. on Commerce, 
Science and Transportation (April 26, 2001), available at , visited June 1, 2001.

    Fraudulent e-mail is a problem that the FTC is attempting 
to address, but some believe additional measures need to be 
taken to punish those who would use fraud or deception to take 
advantage of consumers. None of the spam bills pending before 
Congress would directly address issues relating to this type of 
fraudulent activity.

                     Technically Fraudulent E-mail

    The second type of e-mail fraud is technical fraud. 
Technical fraud, according to the Report to the Federal Trade 
Commission of the Ad-Hoc Working Group on Unsolicited 
Commercial Mail, ``is defined as the variety of practices, such 
as relaying through third-party mail servers, dynamically 
forging header information and registering false domain names, 
used by those sending UCE to avoid detection, frustrate remove 
requests, misdirect replies, and generally frustrate efforts by 
users to prevent their continued receipt of UCE from the same 
sender.'' \8\ Those who engage in the first type of fraud often 
times attempt to conceal their true identities through 
technical fraud. Technical fraud is used to defeat Internet 
service providers' and computer users' e-mail filters, 
preferences, and other technologies developed to combat 
unwanted e-mail.
---------------------------------------------------------------------------
    \8\ Report to the Federal Trade Commission of the Ad-Hoc Working 
Group on Unsolicited Commercial Email (hereinafter ``Ad-Hoc Report'') 
(July 1998).
---------------------------------------------------------------------------
    Some Internet service providers have successfully used 
state statutory or common law as a basis to litigate against 
those who engage in technical fraud; however, most agree that 
more needs to be done. The Ad-Hoc Report reviewed whether 
Federal authorities could prosecute senders of UCE for using 
falsified addressing information and falsified headers to 
deceive consumers and concluded that the legality of such a 
practice was unclear.\9\ The Ad-Hoc Working Group endorsed 
public policies that ``prevent and/or prohibit the use of 
fraudulent headers to send unsolicited commercial email 
messages.'' \10\ All of the witnesses who testified before the 
Committee endorsed the provisions in H.R. 1017 that address 
technical fraud. Addressing technical fraud is the cornerstone 
of the bipartisan compromise adopted by the Committee.
---------------------------------------------------------------------------
    \9\ Id. at 16.
    \10\ Id. at 31.
---------------------------------------------------------------------------

                           E-mail Pornography

    E-mail pornography is a particularly troubling problem. E-
mail pornography is also a concern of the Energy and Commerce 
Committee.\11\ E-mail pornographers obtain e-mail addresses 
from a number of sources, including Internet chat rooms. 
Technology enables them to send millions of unsolicited 
pornographic e-mails to adults and children. Internet service 
providers and the FTC have received numerous complaints about 
such unwanted e-mail, but they have been virtuously powerless 
to stop this practice. The Hart amendment, adopted by the 
Committee, clearly and directly addresses this issue whereas 
H.R. 718, as introduced and reported by the Energy and Commerce 
Committee, treats pornographic e-mail in exactly the same 
manner as all unsolicited commercial e-mail.
---------------------------------------------------------------------------
    \11\ Commerce Report at 9 (``There are also concerns that many 
unsolicited commercial electronic mail messages contain material of an 
adult nature that can be easily accessed by children from the family 
computer, and in many instances these mail messages are intentionally 
sent with incorrect routing information'').
---------------------------------------------------------------------------

                     Unsolicited Commercial E-mail

    Unsolicited commercial e-mail, unlike fraudulent e-mail, is 
more difficult to define. Consumers and retailers often have 
various relationships through various affiliates in which they 
may or may not have prior business relationships. Some 
consumers may give permission to receive information about a 
certain product or type of product (i.e. womens clothing) but 
such permission may not be specific to a given company. 
Identifying the particular stage of e-mail marketing to 
regulate in the retailer-consumer relationship is a difficult 
issue and one the Committee rejected.
    Furthermore, the Committee was not convinced that non-
fraudulent or non-pornographic e-mail marketing requires 
regulation. Most legitimate users of e-mail advertising do not 
engage in fraud or deception and utilize some form of 
permission-based marketing. In their April 26, 2001, testimony, 
the FTC noted that ``well-known manufacturers and sellers of 
consumer goods and services do not send UCE. Rather, such 
merchants use solicited e-mail to give consumers information 
that they have requested about available products, services, 
and sales.'' \12\
---------------------------------------------------------------------------
    \12\ Supra note 7. See also, Unsolicited Commercial Communications 
and Data Protection, Report to the Commission of the European 
Communities, 24-26 (January 2001) (``As for spam, it is clear that its 
days are numbered, now that it is shunned by the marketing industry 
itself as well as by the network operators and by a public which will 
never be inclined to enter into a relationship of trust with at 
spammer.'').
---------------------------------------------------------------------------

 The Committee Adopts a Cautious Approach to the Regulation of E-Mail 
                               Marketing

    The Committee specifically rejected the legal and 
regulatory regime approved by the House Energy and Commerce 
Committee because of concerns about the necessity of regulating 
e-mail marketing and the proportionality of the proposed 
enforcement mechanisms relative to the harm or damage caused by 
non-fraudulent unsolicited commercial e-mail. The amendment in 
the nature of a substitute does not contain many of the 
unprecedented, complicated, and disproportionate enforcement 
provisions contained in H.R. 718. H.R. 718 utilizes a number of 
legal enforcement and regulatory tools to control UCE. These 
provisions are disproportionate to the harm or damage caused by 
spam. H.R. 718, as reported by the Energy and Commerce 
Committee, contains two provisions which would empower Internet 
service providers to effectively write Federal law. These 
provisions raise serious Constitutional concerns.
    First, an ISP's unsolicited commercial e-mail policy could 
be enforced through litigation initiated by ISPs, individuals, 
state attorneys general, and the Federal Trade Commission. The 
second provision would deem an ISP policy a ``Federal trade 
regulation rule'' under section 18 of the FTC Act. There is no 
requirement that the ISP's policy be open to the public 
pursuant to the Administrative Procedures Act as are Federal 
trade regulation rules under current law.\13\ Thus, the 
approximately 5,000 ISP's could write different policies 
enforced by myriad legal actions without the due process 
afforded by traditional rules and law. The Committee's research 
has uncovered no precedent for these provisions, and concerns 
were raised that they are unnecessary and raise constitutional 
issues. Furthermore, because these various laws and policies 
could be enforced in State or Federal courts, a consistent 
application of the new proposed Federal cause of action is far 
from certain.
---------------------------------------------------------------------------
    \13\ 15 U.S.C. Sec. 57a(b)(1).
---------------------------------------------------------------------------
    The Committee is also concerned about the regulation of on-
line commerce, including e-mail marketing. H.R. 718, if not 
changed, would be the first major Federal regulation of online 
commerce. At a time of great technological and market changes 
in the electronic or Internet commerce arena, Congress should 
be cautious when considering new regulations of e-commerce so 
that it does not unintentionally stifle innovation in this 
emerging market place. Furthermore, the law should not, at this 
time, favor one method of conducting business over another. 
H.R. 718, as introduced and reported by the Energy and Commerce 
Committee, would apply onerous rules and regulations to online 
marketing which don't exist in the offline world. The 
consequence of favoring one method of commercial communication 
(mail) over another (e-mail) could adversely impact the growth 
of electronic commerce.
    Another concern about the regulation of e-mail marketing 
has to do with proportionality. The Committee is concerned 
about making a Federal case out of a mere annoyance. Congress 
should carefully consider proposals that would unleash the FTC, 
state attorneys general, and the trial bar on U.S. businesses 
for sending unsolicited commercial e-mail. UCE that is not 
fraudulent or pornographic may be annoying; however, it can be 
easily discarded by deleting it--the equivalent of throwing 
junk mail away. Furthermore, most legitimate businesses are 
interested in attracting new customers and are concerned about 
annoying potential customers. Therefore, most legitimate 
businesses offer some form of permission based marketing and 
will readily remove one's name from a mailing list upon 
request.
    Finally, consumers bear some responsibility in stemming the 
tide of spam. Consumers must be wary about giving out their e-
mail addresses to people or businesses with whom they are 
unfamiliar. For example, by posting one's e-mail address on a 
chat room, one should know that anyone with Internet access 
potentially has access to that posted e-mail address. Online 
pornographers will ``harvest'' e-mail addresses posted on 
Internet chat rooms or message boards and then send 
pornographic material to those individuals. The same common 
sense rules that apply in the offline world also apply to the 
online world, i.e. consumers should only give out their names, 
addresses, and phone numbers to people and merchants that they 
trust.

                Amendment in the Nature of a Substitute

Technical Fraud
    The amendment in the nature of a substitute would create a 
new misdemeanor criminal provision to address the issue of 
technical fraud. Technical fraud includes forging or falsifying 
header and return information, thereby concealing the sender's 
identity. Those who send fraudulent e-mail or pornography often 
use technical fraud to conceal their true identities. 
Furthermore, technical fraud is used to defeat Internet service 
providers' and computer users' e-mail filters, preferences, and 
other technologies designed to block unwanted e-mail. All of 
the witnesses who testified before the Committee, the Federal 
Trade Commission (FTC) in other testimony, and the Ad-Hoc 
Working Group on Unsolicited Commercial E-Mail, which reported 
to the FTC in July 1998, all support public policies addressing 
fraudulently concealing one's identity. A first offense for 
sending UCE with falsified or misleading header information 
would be punishable by fine and a second offense would be 
punishable by imprisonment.
Goodlatte Amendment
    The amendment in the nature of a substitute also includes a 
provision, offered as an amendment by Rep. Bob Goodlatte, 
authorizing Internet service providers to file suit to recover 
actual or statutory damages for engaging in technical fraud. 
Rep. Goodlatte argued that ISP's, which have a vested business 
interest in protecting its customers from receiving fraudulent 
e-mail, would help deter the type of behavior the bill seeks to 
prohibit. Furthermore, it is argued that spam causes ISPs to 
incur tangible quantifiable costs, namely the costs associated 
with maintaining computer networks that may be impaired by 
large volumes of spam and the dissatisfaction of customers and 
the consequent loss of goodwill. It is argued that ISPs would 
use this authority as they do other statutory and common law 
authorities to protect themselves and their customers. For 
example, ISPs have successfully utilized state trespass laws to 
prevent spammers from flooding their networks with unwanted e-
mail.\14\ The Goodlatte amendment is intended to supplement any 
State or Federal authority already relied on by ISPs to protect 
their networks and their customers.
---------------------------------------------------------------------------
    \14\ See e.g. CompuServe Inc. v. Cyber Promotions, Inc., 962 F. 
Supp. 1015 (S.D. Ohio 1997); America Online, Inc. v. IMS, 24 F. Supp.2d 
548 (E.D. Va. 1998); America Online, Inc. v. LCGM, Inc., 46 F. Supp.2d 
444 (E.D. Va 1998). For a more detailed review of statutory and common 
law legal theories utilized to address spam, see Credence E. Fogo, The 
Postman Always Rings 4,000 Times: New Approaches to Curb Spam, 18 John 
Marshall Journal of Computer and Information Law, 915 (2000); Michael 
A. Fisher, The Right to Spam? Regulating Electronic Junk Mail, 23 
Columbia-VLA Journal of Law and the Arts 357 (2000); Kenneth C. 
Amaditz, Canning ``Spam'' in Virginia: Model Legislation to Control 
Junk E-mail, 4 Va. J.L. & Tech. 4 (1999).
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Hart Amendment
    The amendment in the nature of a substitute contains a 
provision, offered as an amendment by Rep. Melissa Hart, that 
directs the Attorney General to prescribe marks to be included 
in all pornographic e-mail. The amendment is modeled after a 
long-standing postal statute, 39 U.S.C. Sec. 3010, which 
mandates that marks be included on the envelope of pornographic 
material sent through the United States Postal Service. This 
provision will allow users to delete pornographic material 
without viewing its contents and will assist parents in 
screening or filtering out unwanted pornographic e-mail, 
thereby protecting children from receiving and viewing 
pornography contained or accompanying e-mail. In short, a 
recipient of a pornographic e-mail will now have the ability to 
utilize technology to automatically do the equivalent of 
throwing out unopened junk mail. Concerns were raised at the 
markup that this provision raised constitutional concerns; 
however, the Congressional Research Service, in a memorandum to 
the Committee, concluded that the Hart amendment is 
constitutional. The memorandum is reprinted in this report.
Schiff Amendment
    Finally, the Committee adopted an amendment offered by Rep. 
Adam Schiff which directs the Attorney General to conduct a 
study of the effectiveness of the Act.

        Congressional Research Service Memorandum Regarding the 
                Constitutionality of the Hart Amendment

    Because concerns were raised at the markup about the 
constitutionality of the Hart amendment, which would make it a 
misdemeanor to knowingly send an e-mail that includes a 
sexually oriented advertisement without a mark or notice 
prescribed by the Attorney General, the Committee requested a 
legal opinion from the American Law Division of the 
Congressional Research Service (CRS) regarding the 
constitutionality of the amendment. The opinion concludes that 
the Hart amendment would not violate the First Amendment of the 
U.S. Constitution. The CRS memorandum follows: 


                                Hearings

    The Committee held a legislative hearing on H.R. 718, the 
``Unsolicited Commercial Electronic Mail Act of 2001,'' and 
H.R. 1017, the ``Anti-Spamming Act of 2001'' on May 10, 2001. 
Testimony was received from The Honorable Heather Wilson, U.S. 
Representative from the First Congressional District in New 
Mexico; Mr. Rick Lane, Director, eCommerce & Internet 
Technology, U.S. Chamber of Commerce; Mr. Marc Lackritz, 
President, Securities Industry Association; Mr. Paul Misener, 
Vice President for Global Public Policy, Amazon.com 
(representing Amazon.com and the National Retail Federation); 
and Mr. Wayne Crews, Director of Technology Studies, Cato 
Institute.

                        Committee Consideration

    On May, 23, 2001, the Committee met in open session and 
ordered favorably reported the bill H.R. 718, as amended, by 
voice vote, a quorum being present.

                         Votes of the Committee

    1. Mr. Watt offered an amendment to the Goodlatte amendment 
to the amendment in the nature of a substitute which would have 
expanded the private right of action proposed by the Goodlatte 
amendment to allow customers of Internet service providers to 
bring an action against a person who violates subsection (a). 
The amendment was defeated by a rollcall vote of 10 to 17.

                                                   ROLLCALL NO. 1
----------------------------------------------------------------------------------------------------------------
                                                                       Ayes            Nays           Present
----------------------------------------------------------------------------------------------------------------
Mr. Hyde........................................................
Mr. Gekas.......................................................                              X
Mr. Coble.......................................................                              X
Mr. Smith (Texas)...............................................                              X
Mr. Gallegly....................................................
Mr. Goodlatte...................................................                              X
Mr. Chabot......................................................                              X
Mr. Barr........................................................                              X
Mr. Jenkins.....................................................                              X
Mr. Hutchinson..................................................                              X
Mr. Cannon......................................................                              X
Mr. Graham......................................................
Mr. Bachus......................................................                              X
Mr. Scarborough.................................................
Mr. Hostettler..................................................
Mr. Green.......................................................                              X
Mr. Keller......................................................                              X
Mr. Issa........................................................                              X
Ms. Hart........................................................                              X
Mr. Flake.......................................................                              X
Mr. Conyers.....................................................              X
Mr. Frank.......................................................              X
Mr. Berman......................................................              X
Mr. Boucher.....................................................
Mr. Nadler......................................................              X
Mr. Scott.......................................................
Mr. Watt........................................................              X
Ms. Lofgren.....................................................                              X
Ms. Jackson Lee.................................................              X
Ms. Waters......................................................              X
Mr. Meehan......................................................
Mr. Delahunt....................................................
Mr. Wexler......................................................
Ms. Baldwin.....................................................              X
Mr. Weiner......................................................              X
Mr. Schiff......................................................              X
Mr. Sensenbrenner, Chairman.....................................                              X
                                                                 -----------------------------------------------
    Total.......................................................             10              17
----------------------------------------------------------------------------------------------------------------

    2. Ms. Lofgren offered and amendment to the Goodlatte 
amendment to the amendment in the nature of a substitute which 
proposed to strike the provision in the Goodlatte amendment 
which provides statutory damages, thereby limiting damages to 
actual damages. The Lofgren amendment also proposed to permit 
an ``e-mail recipient'' to sue for actual damages. The 
amendment was defeated by a rollcall vote of 12 to 16.

                                                   ROLLCALL NO. 2
----------------------------------------------------------------------------------------------------------------
                                                                       Ayes            Nays           Present
----------------------------------------------------------------------------------------------------------------
Mr. Hyde........................................................
Mr. Gekas.......................................................                              X
Mr. Coble.......................................................                              X
Mr. Smith (Texas)...............................................                              X
Mr. Gallegly....................................................                              X
Mr. Goodlatte...................................................                              X
Mr. Chabot......................................................                              X
Mr. Barr........................................................                              X
Mr. Jenkins.....................................................                              X
Mr. Hutchinson..................................................                              X
Mr. Cannon......................................................              X
Mr. Graham......................................................
Mr. Bachus......................................................                              X
Mr. Scarborough.................................................
Mr. Hostettler..................................................                              X
Mr. Green.......................................................                              X
Mr. Keller......................................................                              X
Mr. Issa........................................................
Ms. Hart........................................................                              X
Mr. Flake.......................................................                              X
Mr. Conyers.....................................................              X
Mr. Frank.......................................................              X
Mr. Berman......................................................              X
Mr. Boucher.....................................................
Mr. Nadler......................................................              X
Mr. Scott.......................................................
Mr. Watt........................................................              X
Ms. Lofgren.....................................................              X
Ms. Jackson Lee.................................................              X
Ms. Waters......................................................              X
Mr. Meehan......................................................
Mr. Delahunt....................................................
Mr. Wexler......................................................
Ms. Baldwin.....................................................              X
Mr. Weiner......................................................              X
Mr. Schiff......................................................              X
Mr. Sensenbrenner, Chairman.....................................                              X
                                                                 -----------------------------------------------
    Total.......................................................             12              16
----------------------------------------------------------------------------------------------------------------

    3. Mr. Schiff offered an amendment to the amendment in the 
nature of a substitute which proposed an additional misdemeanor 
offense for failure to include within the header information an 
identifier prescribed by the Attorney General which would have 
informed the recipient that the electronic message was an 
unsolicited commercial electronic message. The identifier would 
have also permitted automatic filtering. The amendment was 
defeated by a rollcall vote of 8 to 14.

                                                   ROLLCALL NO. 3
----------------------------------------------------------------------------------------------------------------
                                                                       Ayes            Nays           Present
----------------------------------------------------------------------------------------------------------------
Mr. Hyde........................................................
Mr. Gekas.......................................................
Mr. Coble.......................................................                              X
Mr. Smith (Texas)...............................................                              X
Mr. Gallegly....................................................              X
Mr. Goodlatte...................................................                              X
Mr. Chabot......................................................                              X
Mr. Barr........................................................                              X
Mr. Jenkins.....................................................                              X
Mr. Hutchinson..................................................
Mr. Cannon......................................................                              X
Mr. Graham......................................................
Mr. Bachus......................................................              X
Mr. Scarborough.................................................
Mr. Hostettler..................................................                              X
Mr. Green.......................................................                              X
Mr. Keller......................................................                              X
Mr. Issa........................................................
Ms. Hart........................................................                              X
Mr. Flake.......................................................                              X
Mr. Conyers.....................................................
Mr. Frank.......................................................
Mr. Berman......................................................
Mr. Boucher.....................................................
Mr. Nadler......................................................
Mr. Scott.......................................................
Mr. Watt........................................................              X
Ms. Lofgren.....................................................                              X
Ms. Jackson Lee.................................................              X
Ms. Waters......................................................              X
Mr. Meehan......................................................
Mr. Delahunt....................................................
Mr. Wexler......................................................
Ms. Baldwin.....................................................              X
Mr. Weiner......................................................              X
Mr. Schiff......................................................              X
Mr. Sensenbrenner, Chairman.....................................                              X
                                                                 -----------------------------------------------
    Total.......................................................              8              14
----------------------------------------------------------------------------------------------------------------

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII of the Rules 
of the House of Representatives, the Committee reports that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

                    Performance Goals and Objectives

    H.R. 718 does not authorize funding. Therefore, clause 3(c) 
of rule XIII of the Rules of the House of Representatives is 
inapplicable.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives is inapplicable because this legislation does 
not provide new budgetary authority or increased tax 
expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 718, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, June 5, 2001.
Hon. F. James Sensenbrenner, Jr., Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 718, the Anti-
Spamming Act of 2001.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark 
Grabowicz (for Federal costs), who can be reached at 226-2860, 
and Lauren Marks (for the private-sector impact), who can be 
reached at 226-2940.
            Sincerely,
                                  Dan L. Crippen, Director.

Enclosure

cc:
        Honorable John Conyers Jr.
        Ranking Member
H.R. 718--Anti-Spamming Act of 2001.
    CBO estimates that implementing H.R. 718 would result in no 
significant costs to the Federal Government. Because enactment 
of the bill could affect direct spending and receipts, pay-as-
you-go procedures would apply, however, CBO estimates that any 
impact on direct spending and receipts would not be 
significant. H.R. 718 contains no intergovernmental mandates as 
defined in the Unfunded Mandates Reform Act (UMRA) and would 
impose no costs on state, local, or tribal governments. The 
bill would impose a private-sector mandate as defined by UMRA 
on individuals who send commercial electronic mail containing a 
sexually oriented advertisement. Based on information provided 
by government and industry sources, CBO expects that the direct 
cost of complying with the mandate would fall well below the 
annual threshold established by UMRA ($113 million in 2001, 
adjusted annually for inflation).
    H.R. 718 would impose new restrictions on the transmission 
of unsolicited commercial electronic mail (UCE). The bill would 
establish criminal penalties for knowingly sending certain UCE 
that contains false identification information or sexually 
oriented advertisements. Under the bill's provisions, providers 
of internet access could initiate legal action against persons 
who send UCE containing false identification information. H.R. 
718 also would direct the Attorney General to prepare a report, 
within 18 months of enactment, on the effectiveness and 
enforcement of the bill's provisions.
    CBO estimates that it would cost the Department of Justice 
less than $500,000 to prepare the report required by the bill, 
subject to the availability of appropriated funds. Because
    H.R. 718 would establish a new Federal crime, the 
government would be able to pursue cases that it otherwise 
would not be able to prosecute. Under the bill, however, we 
expect a relatively small number of cases would be pursued and 
that any increase in costs for law enforcement, court 
proceedings, or prison operations would not be significant. Any 
such costs would be subject to the availability of appropriated 
funds.
    Because those prosecuted and convicted under H.R. 718 could 
be subject to criminal fines, the government might collect 
additional fines if the bill is enacted. Collections of such 
fines are recorded in the budget as governmental receipts 
(revenues), which are deposited in the Crime Victims Fund and 
spent later. Any additional receipts and direct spending from 
enacting H.R. 718 are not likely to be significant because of 
the relatively small number of cases involved.
    H.R. 718 would impose a private-sector mandate as defined 
by UMRA on individuals who send electronic mail that contains a 
sexually oriented advertisement. The bill would require the 
senders to include marks or notices, to be prescribed by the 
Attorney General, on all such messages that would inform 
recipients of the sexual content of the message. Based on 
information provided by government and industry sources, CBO 
estimates that the direct cost of complying with this mandate 
would fall well below the annual threshold established by UMRA 
for private-sector mandates.
    On April 13, 2001, CBO transmitted a cost estimate for H.R. 
718, the Unsolicited Commercial Electronic Mail Act of 2001, as 
reported by the House Committee on Energy and Commerce on April 
4, 2001. CBO estimated that implementing that legislation would 
cost about $6 million over the 2002-2006 period and would 
increase revenues by about $13 million over the same period, 
mostly from provisions affecting the Federal Trade Commission.
    The CBO staff contacts for this estimate are Mark Grabowicz 
(for Federal costs), who can be reached at 226-2860, and Lauren 
Marks (for the private-sector impact), who can be reached at 
226-2940. This estimate was approved by Peter H. Fontaine, 
Deputy Assistant Director for Budget Analysis.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the authority for 
this legislation in article I, section 8, clauses 3 and 18 of 
the Constitution.

       Section-by-Section Analysis and Discussion and Discussion

    Section 1. Short Title. Provides that the short title of 
the act shall be the ``Anti-Spamming Act of 2001.''
    Section 2. Spamming Prohibitions. Adds a new ``Chapter 30--
Electronic Mail'' to title 18 of the United States Code. Two 
new sections, 621 and 622, would be included in chapter 30. 
Section 621(a) would prohibit anyone from sending an 
unsolicited commercial electronic mail message that contains 
fraudulent transmission information. Specifically, the new 
section would prohibit the intentional transmission of 10 or 
more unsolicited commercial electronic mail message to one or 
more protected computers in the United States knowing that the 
message contains or is accompanied by header information that 
is materially false or misleading as to the identity of the 
person initiating the transmission. A first offense under this 
section is punishable by fine under the applicable provisions 
of title 18, United States Code, and subsequent offenses may be 
punished by imprisonment for not more than 1 year.
    Subsection (b)(1) of section 621 defines ``commercial 
electronic mail message'' as ``an electronic mail message the 
primary purpose of which is to advertise or promote, for a 
commercial purpose, a product or service (including content on 
an Internet website).'' Subsection (b)(2) defines ``header 
information'' as ``the source, destination, and routing 
information, including the originating domain name and 
originating electronic mail address.'' Subsection (b)(3) 
defines ``protected computer'' in the same manner as it is 
defined by 18 U.S.C. Sec. 1030(e)(2).
    Subsection (c) of section 621 provides that an Internet 
service provider may bring a cause of action in an appropriate 
state court, or, if not permitted by state laws or rules, in an 
appropriate Federal court, against a person who commits a 
violation of subsection (a). Such a person would be liable for 
actual or statutory damages, an may be liable for costs. 
Statutory damages are $5.00 per violation, not to exceed 
$1,000,000, except that, no limit applies if during any 1-year 
period the defendant transmitted in excess of 20,000,000 
unsolicited commercial electronic mail messages.
    New section 622 would prohibit the inclusion of a sexually 
oriented advertisement in electronic mail unless it includes a 
warning label. Specifically, section 622 directs the Attorney 
General to prescribe marks or notices to be included in 
electronic mail that contains a sexually oriented advertisement 
in order to inform the recipient of that fact. Whoever 
knowingly includes such an advertisement without including the 
prescribed marks shall be fined under the applicable provisions 
of title 18, United States Code, or imprisoned not more than 1 
year, or both.
    Section 622(b) defines ``sexually oriented advertisement'' 
as ``any advertisement that depicts, in actual or simulated 
form, or explicitly describes, in a predominantly sexual 
context, human genitalia, any act of sadism or masochism, or 
any other erotic subject directly related to the foregoing, but 
material otherwise within the definition of this subsection 
shall be deemed not to constitute a sexually oriented 
advertisement if it constitutes only a small and insignificant 
part of the whole, the remainder of which is not primarily 
devoted to sexual matters.''
    Section 3. Study of Effects of Unsolicited Commercial 
Electronic Mail. Directs the Attorney General to submit a 
report to Congress with 18 months of enactment of the Act which 
provides a detailed analysis of the effectiveness of the 
enforcement provisions of the Act and the need (if any) for the 
Congress to modify such provisions.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italics and existing law in which no change is 
proposed is shown in roman):

                      TITLE 18, UNITED STATES CODE



           *       *       *       *       *       *       *
                             PART I--CRIMES

Chap.                                                               Sec.
1.     General provisions.........................................     1
     * * * * * * *
30.   Electronic mail.............................................   621
     * * * * * * *

                      CHAPTER 30--ELECTRONIC MAIL

Sec.
621.  Unsolicited commercial electronic mail containing fraudulent 
          transmission information.
622.  Warning labels for electronic mail containing advertisements 
          harmful to minors.

Sec. 621. Unsolicited commercial electronic mail containing fraudulent 
                    transmission information

  (a) Whoever intentionally initiates in one or more 
transactions the transmission of 10 or more unsolicited 
commercial electronic mail messages to one or more protected 
computers in the United States, knowing that each such message 
contains or is accompanied by header information that is 
materially false or misleading as to the identity of the person 
initiating the transmission shall be fined under this title, 
and in the case of an offense under this section which occurs 
after conviction for a prior offense under this section, shall 
be so fined or imprisoned not more than one year, or both.
  (b) As used in this section--
          (1) the term ``commercial electronic mail message'' 
        means an electronic mail message the primary purpose of 
        which is to advertise or promote, for a commercial 
        purpose, a product or service (including content on an 
        Internet website);
          (2) the term ``header information'' means the source, 
        destination, and routing information, including the 
        originating domain name and originating electronic mail 
        address; and
          (3) the term ``protected computer'' has the meaning 
        given that term in section 1030(e)(2) of this title.
  (c)(1) A provider of Internet access service, if otherwise 
permitted by the laws or rules of a court of a State, may bring 
in an appropriate court of that State, or, if such laws or 
rules do not so permit, may bring in an appropriate Federal 
court, an action to recover for actual or statutory damages, as 
provided in paragraph (2), and for costs, as provided in 
paragraph (4).
  (2) A person committing a violation of subsection (a) is 
liable to a provider of Internet access service for either--
          (A) the actual damages suffered by the provider of 
        Internet access service; or
          (B) statutory damages, as provided in paragraph (3).
  (3) At any time before final judgment in an action, a 
provider of Internet access service may elect to recover an 
award of statutory damages for each violation of subsection (a) 
in the sum of $5 per violation, not to exceed a total of 
$1,000,000, except that, during any one-year period for which 
the defendant has transmitted in excess of 20,000,000 
unsolicited commercial electronic mail messages, no such limit 
on liability shall exist.
  (4) In any action brought under paragraph (1), the court may 
award to a prevailing party reasonable litigation expenses 
incurred by that party, including reasonable attorney's fees, 
as a part of the costs awarded under section 1920 of title 28 
against any party found in that action to have committed a 
violation of subsection (a).

Sec. 622. Warning labels for electronic mail containing advertisements 
                    harmful to minors

  (a)(1) The Attorney General shall prescribe marks or notices 
to be included in electronic mail that contains a sexually 
oriented advertisement in order to inform the recipient of that 
fact.
  (2) Whoever, in any electronic mail that is carried on an 
instrumentality in or affecting interstate or foreign commerce, 
knowingly includes a sexually oriented advertisement but does 
not include in such electronic mail the marks or notices 
prescribed by the Attorney General under this section shall be 
fined under this title or imprisoned not more than one year, or 
both.
  (b) As used in this section, the term ``sexually oriented 
advertisement'' means any advertisement that depicts, in actual 
or simulated form, or explicitly describes, in a predominantly 
sexual context, human genitalia, any act of natural or 
unnatural sexual intercourse, any act of sadism or masochism, 
or any other erotic subject directly related to the foregoing, 
but material otherwise within the definition of this subsection 
shall be deemed not to constitute a sexually oriented 
advertisement if it constitutes only a small and insignificant 
part of the whole, the remainder of which is not primarily 
devoted to sexual matters.

           *       *       *       *       *       *       *


                           Markup Transcript



                            BUSINESS MEETING

                        WEDNESDAY, MAY 23, 2001

                  House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:06 a.m., in 
Room 2141, Rayburn House Office Building, Hon. F. James 
Sensenbrenner, Jr. [chairman of the committee] presiding.
    Chairman Sensenbrenner. The committee will be in order.
    The next item on the agenda is H.R. 718, the Unsolicited 
Commercial Electronic Mail Act of 2001, and I move its 
favorable recommendation to the full House.
    [H.R. 718 follows:] 
    
    
    Without objection, the bill will be considered as read and 
open for amendment at any point, and the amendment in the 
nature of a substitute, which the members have before them, 
will be considered as read and considered as the original text 
for purposes of amendment.
    [The amendment in the nature of a substitute follows:] 
    
    
    Chairman Sensenbrenner. The Chair recognizes himself to 
strike the last word.
    The amendment in the nature of a substitute that all 
members have before them is the product of bipartisan 
cooperation between the majority and the minority, and I 
appreciate the work of all members on this bill. Judiciary 
Committee members on both sides of the aisle voiced concern 
about sweeping legislation that would regulate e-mail 
marketing, and this bipartisan substitute addresses those 
concerns.
    Specifically, the substitute would create a new misdemeanor 
criminal provision to address the issue of technical fraud. 
Technical fraud includes forging or falsifying header and 
return information, thereby concealing the sender's identity. 
Those who send fraudulent e-mail or pornography often use 
technical fraud to conceal their true identities. Furthermore, 
technical fraud is used to defeat Internet service providers' 
and computer users' e-mail filters, preferences, and other 
technologies designed to block unwanted e-mail.
    All of the witnesses who testified before the committee, 
the Federal Trade Commission in other testimony, and the Ad Hoc 
Working Group on Unsolicited Commercial E-Mail, which reported 
to the FTC in July 1998, all support public policies which 
address fraudulently concealing one's identity.
    The substitute, however, does not address generalized 
concerns about unsolicited commercial e-mail, and the 
substitute does not contain many of the unprecedented and 
disproportionate enforcement provisions contained in H.R. 718.
    The Wilson bill utilizes almost every legal enforcement 
tool known to lawyers to regulate and to litigate issues 
relating to unsolicited commercial e-mail. These provisions are 
disproportionate to the harm or damage caused by spam.
    In addition to a complicated, cumbersome, and punitive 
regulatory regime, the Wilson bill contains two unprecedented 
provisions which would empower the Internet service providers 
to write Federal law. First, an ISP's unsolicited commercial e-
mail policy could be enforced by a private right of action, 
State attorneys general, and the Federal Trade Commission. The 
second provision would deem an ISP policy a Federal regulation 
rule under Section 18 of the Federal Trade Commission Act. 
There is no requirement that the ISP policy be open to the 
public for comment, as are Federal Trade regulation rules under 
the Administrative Procedures Act. Thus, approximately 5,000 
ISPs could write different policies, enforced by myriad legal 
actions, without due process afforded by traditional rules and 
by law. The committee's research has uncovered no precedent for 
these provisions, and I believe them to be unnecessary and may 
raise constitutional issues.
    I am also skeptical of the regulation of online commerce, 
including e-mail marketing. H.R. 718, if not changed, would be 
the first major Federal regulation of online commerce. Congress 
should be cautious when considering new regulations of e-
commerce.
    Congress has always supported and encouraged Internet 
commerce in several ways. The e-signatures bill and the 
Internet access tax moratorium were affirmative signals that 
Congress wanted the efficiencies of the Internet to bring 
choices, competition, and needed information to consumers. 
Electronic commerce is still in its infancy. Business models 
are constantly changing to find the right formula for success 
over the Internet.
    For example, banner ad revenue has fallen almost as much as 
the stock prices of many dotcoms. Marketing, no matter how 
annoying, is integral to the success of commerce, including 
electronic commerce. Members on both sides of the aisle have 
raised serious concerns about regulating e-mail marketing and 
its impact on the growth of commerce, and I am convinced that a 
go-slow approach is needed during this time of great 
technological and market change.
    Another concern about the regulation of e-marketing has to 
do with proportionality. I am concerned about making a Federal 
case out of a mere annoyance. Congress should carefully 
consider proposals to unleash the FTC, State attorneys general, 
and the trial bar on U.S. businesses for sending un-
commercial--unsolicited commercial e-mail. I believe that we 
should do what we can to address fraudulent e-mail, but also 
believe that we need to be careful and cautious about 
regulating e-mail marketing.
    We should not lump e-mail fraud, e-mail pornography, and e-
mail marketing all in the same category. They are demonstrably 
different, and we should address the problems that actually 
cause harm or damage. Congress should avoid falling victim to 
the law of unintended consequences, particularly because 
Internet commerce is still in its infancy. The substitute 
forces on the issue of--focuses on the issue of fraud, which is 
an appropriate area for government action.
    [The statement of Mr. Sensenbrenner follows:]
  Prepared Statement of the Honorable F. James Sensenbrenner, Jr., a 
         Representative in Congress From the State of Wisconsin
    The amendment in the nature of a substitute that all Members have 
before them is the product of bipartisan cooperation between the 
majority and minority, and I appreciate the work of all Members on this 
bill. Judiciary Committee Members on both sides of the aisle voiced 
concerns about sweeping legislation that would regulate e-mail 
marketing and this bipartisan substitute addresses those concerns.
    Specifically, the substitute would create a new misdemeanor 
criminal provision to address the issue of technical fraud. Technical 
fraud includes forging or falsifying header and return information, 
thereby concealing the sender's identity. Those who send fraudulent e-
mail or pornography often use technical fraud to conceal their true 
identities. Furthermore, technical fraud is used to defeat Internet 
service providers' and computer users' e-mail filters, preferences, and 
other technologies designed to block unwanted e- mail. All of the 
witnesses who testified before the Committee, the Federal Trade 
Commission (FTC) in other testimony, and the Ad-Hoc Working Group on 
Unsolicited Commercial E-Mail, which reported to the FTC in July 1998, 
all support public policies addressing fraudulently concealing one's 
identity.
    The substitute, however, does not addresses generalized concerns 
about unsolicited commercial e-mail and the substitute does not contain 
many of the unprecedented and disproportionate enforcement provisions 
contained in H.R. 718. The Wilson bill utilizes almost every legal 
enforcement tool known to lawyers to regulate and litigate issues 
relating to unsolicited commercial e-mail. These provisions are 
disproportionate to the harm or damage caused by spam. In addition to a 
complicated, cumbersome, and punitive regulatory regime, the Wilson 
bill contains two unprecedented provisions which would empower Internet 
service providers to write federal law.
    First, an ISP's unsolicited commercial e-mail policy could be 
enforced by private right of action, state attorneys general, and the 
Federal Trade Commission. The second provision would deem an ISP policy 
a ``federal trade regulation rule'' under section 18 of the FTC Act. 
There is no requirement that the ISP's policy be open to the public for 
comment as are federal trade regulation rules under the Administrative 
Procedures Act. Thus, the approximately 5,000 ISP's could write 
different policies enforced by myriad legal actions without the due 
process afforded by traditional rules and law. The Committee's research 
has uncovered no precedent for these provisions, and I believe they are 
unnecessary and may raise constitutional issues.
    I am also skeptical of the regulation of on-line commerce, 
including e- mail marketing. H.R. 718, if not changed, would be the 
first major federal regulation of online commerce. Congress should be 
cautious when considering new regulations of e-commerce.
    Congress has supported and encouraged Internet commerce in several 
ways. The E-signatures bill and Internet access tax moratorium were 
affirmative signals that Congress wanted the efficiencies of the 
Internet to bring choices, competition, and needed information to 
consumers. Electronic commerce is still in its infancy. Business models 
are constantly changing to find the right formula for success over the 
Internet. For example, banner ad revenue has fallen almost as much as 
the stock prices of many dot-coms. Marketing, no matter how annoying, 
is integral to the success of commerce, including electronic commerce. 
Members on both sides of the aisle have raised serious concerns about 
regulating e-mail marketing and its impact on the growth of commerce, 
and I am convinced that a go-slow approach is needed during this time 
of great technological and market change.
    Another concern about the regulation of e-mail marketing has to do 
with proportionality. I am concerned about making a federal case out of 
a mere annoyance. Congress should carefully consider proposals to 
unleash the FTC, state attorneys general, and the trial bar on U.S. 
businesses for sending unsolicited commercial e-mail.
    I believe we should do what we can to address fraudulent e-mail, 
but also believe we need to be careful and cautious about regulating e-
mail marketing. We should not lump e-mail fraud, e-mail pornography, 
and e-mail marketing all in the same category. They are demonstrably 
different, and we should address the problems that actually cause harm, 
or damage.
    Congress should also avoid falling victim to the law of unintended 
consequences, particularly because Internet commerce is still in its 
infancy. The substitute focuses on the issue of fraud which is an 
appropriate area for government action. Again, I want to I urge my 
colleagues to support the substitute and yield back the balance of my 
time.

    Again, I want to urge my colleagues to support the 
substitute and now recognize the gentleman from Michigan, Mr. 
Conyers.
    Mr. Conyers. Thank you, Mr. Chairman. Our negotiations have 
paid off again, and we now have a bill that really deals with 
the major concern that this legislation brought with it 
initially, and that was the First Amendment considerations by 
being no more extensive than necessary. And we have resolved 
those concerns by the elimination of a series of vague terms 
and prohibitions and sentencing procedures which now would 
require a second offense with over 10 or more e-mails to bring 
about any imprisonment.
    We've also excluded the language that would require that 
718 has the force of law to Internet service provider policies 
on blocking e-mails, which, again, was a First Amendment 
consideration. And I think that we've got now a substitute that 
people with differing philosophies can come together to deal 
with a very annoying problem that now will be able to receive 
congressional attention, and I think it'll remedy this problem 
a great deal, and I urge my colleagues to accept this 
substitute.
    Chairman Sensenbrenner. Without--without objection, all 
member's opening statements will be inserted in the record at 
this point.
    [The statement of Mr. Conyers follows:]
Prepared Statement of the Honorable John Conyers, Jr., a Representative 
                 in Congress From the State of Michigan
    From scheduling the hearing to our negotiations over the past two 
weeks, the Chairman has not only upheld this Committee's jurisdiction 
but also worked with us to arrive at more reasonable legislation. 
Immediately after the hearing, we took to him our concerns with the 
original bill--he shared our concerns and was able to accept all of our 
suggested changes. And that is why I am pleased to join him in offering 
this substitute.
    Our major concern was ensuring that the legislation complied with 
First Amendment rights by being ``no more extensive than necessary.'' 
We resolved those concerns by eliminating vague terms and narrowing the 
prohibition to commercial e-mails with ``materially false or 
misleading'' header information. And the prohibition applies only to 
ten or more e-mails, so that the transmission of just one e-mail is not 
penalized.
    We also eased the penalties themselves. The original bill provided 
for a fine or even imprisonment for a first offense. Under the 
Sensenbrenner- Conyers substitute, a first offense results in a 
criminal fine with no possibility of imprisonment. For a second 
offense, a violator can receive a fine, imprisonment for not more than 
one year, or both. Moreover, there are no mandatory minimum sentences.
    Finally, we excluded language from H.R. 718 that gave the force of 
law to ISP policies on blocking e-mails. Not only did that language 
raise First Amendment concerns, but it gave congressional imprimatur to 
any ISP policy, even if that policy discriminated against competing 
ISPs.
    I'd like to thank the Chairman again for working with us to draft 
this substitute and hope we can continue working together when the spam 
bills reach the floor and possibility go to conference.

    Chairman Sensenbrenner. Are there amendments? The gentleman 
from North Carolina.
    Mr. Coble. Mr. Chairman, I move to strike the last word.
    Chairman Sensenbrenner. The gentleman's recognized for 5 
minutes.
    Mr. Coble. And I will not utilize my entire 5 minutes, but 
a concern's been raised that the legislation before us may 
produce the unintended consequence of prohibiting intellectual 
property owners attempting to protect their rights from sending 
electronic notices to infringing parties. Now, I'm satisfied 
that the nature--the amendment in the nature of a substitute to 
H.R. 718 alleviates this concern. Still, we will continue to 
monitor H.R. 718 as it moves forward to ensure that 
intellectual property owners may use electronic mail as a means 
of protecting their property.
    The Digital Millennium Copyright Act, which Congress passed 
in 1998, made great progress in protecting intellectual 
property by applying traditional laws to the digital 
environment. However, the protection in the DMCA would be 
compromised, in my opinion, if intellectual property owners 
were not able to pursue Internet pirates and infringers. And if 
the gentleman from California, the ranking member of the 
Subcommittee on Courts, Internet, and Intellectual Property, 
would like to add further, I will happily yield to him.
    Mr. Berman. Mr. Chairman, I thank the gentleman for 
yielding, and I agree entirely with him that it is critical 
that intellectual property owners be able to police their 
property on the Internet. The anti-spam legislation in all 
forms was not intended--in any of its forms was not intended to 
injure legitimate business interactions. Therefore, I'm 
encouraged that the amendment in the nature of a substitute 
being offered by the Chair and ranking member takes care of the 
intellectual property concerns. We just want to make sure as 
the bill moves along that property owners--we keep these 
intellectual property owners in mind as we move forward with 
this anti-spam legislation. And I yield back.
    Mr. Coble. I'll reclaim my time, Mr. Chairman, and yield 
back my time.
    Mr. Frank. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from Massachusetts seek recognition?
    Mr. Frank. To strike the last word.
    Chairman Sensenbrenner. The gentleman's recognized for 5 
minutes.
    Mr. Frank. Mr. Chairman, I agree that the original bill 
went too far. I was a cosponsor, and I think it was broader 
than was wise. In particular, giving legal force to the 
policies of the multiplicity of independent service providers 
obviously was just not a very good idea. And I'm going to vote 
for the substitute because it's better than nothing, but I am 
concerned that it does not go far enough. And I have a question 
for those who worked on the substitute and others who are 
knowledgeable.
    In the original bill, one provision which seemed to me 
useful was allowing people to notify senders of their objection 
and for them then to have a right not to get further 
transmissions from that individual. What will the status of 
that policy be if we just adopt the substitute? There was a 
right to object to unsolicited mail and ask that it not be sent 
again.
    Now, you helped us by giving--making sure the address is 
right, but will you have the right, if you get correctly 
return-addressed mail, to say please don't send this to me 
anymore? And I would yield to anyone who could answer that.
    Chairman Sensenbrenner. Would the gentleman yield?
    Mr. Frank. Yes.
    Chairman Sensenbrenner. The substitute deals with fraud. It 
does not--it does not deal with normal business practices, 
similar to the Postal Service. You know, if somebody sticks a 
stamp on a letter and addresses it to you, you know, it's 
delivered to your mailbox.
    Mr. Frank. Well, I appreciate that----
    Chairman Sensenbrenner. What happens after it gets there is 
up to you.
    Mr. Frank. Well, I understand that. I do think unsolicited 
mail is easier to deal with than unsolicited e-mail, which can 
cause a clog and you get a kind of Gresham's law in which the 
bad drives out the good when you have got to sort through a 
lot. And I regret the absence in the substitute of a provision 
that would allow people, having once been solicited, to tell 
the person who had solicited them not to do that again. We've 
followed that practice in some other areas of financial 
privacy, and I think that model is a good one. I don't think it 
interferes with First Amendment rights at all. And as I said, I 
do think being the recipient of e-mail can be more of an 
intrusion than the recipient of other mail which you can simply 
throw out and don't have to sort through. Sorting through e-
mail can be a problem. I've had complaints about this.
    So I do--I appreciate the fraud part, and I do agree that 
718 went too far, particularly with regard to the independent 
service providers. But I think we are leaving people 
insufficiently protected, and it does seem to me people who 
notify----
    Mr. Goodlatte. Would the gentleman yield?
    Mr. Frank.--sent them the material ought to have a right to 
say no.
    Yes, I'll yield to the gentleman from Virginia.
    Mr. Goodlatte. I thank the gentleman for yielding. As you 
may know, I have offered legislation on this matter as well, 
and I share the gentleman's concern. My concern with regard to 
what you're talking about--and I agree, we should have 
ultimately some provision that provides for the ability to 
request that your name--that you not be re-solicited, if you 
will. But it is in the remedies portion of that. I don't want 
to have a proliferation of lawsuits or whatever as a result of 
that.
    So I would be happy to continue to work with the 
gentleman----
    Mr. Frank. Well, I thank the gentleman for that. Yes, I 
agree that probably a mandatory minimum sentence to which we 
resort all too quickly would probably not be appropriate, 
although the inappropriateness of mandatory minimum sentences 
has not deterred us sufficiently in the past.
    And I would be glad to work with the gentleman on that in 
terms of other penalties. It might be that you had to spend 3 
hours a day reading all your own e-mails. I can think of some 
others.
    But on that assurance, as I said--well, I'm going to vote 
for the bill, anyway, and I'm not prepared with any 
alternative. But I'm glad to hear that because I do think we 
ought to be able to help people protect themselves from 
having--from getting flooded and having their ability to read 
what they want to read crowded out by what they don't want to 
read, which is a different situation than the mail. I'd yield 
again.
    Mr. Goodlatte. If you'd yield further, the reality here 
with this type of circumstance is that the Internet service 
providers are what people really have to depend on to help them 
fend off this enormous and rapidly growing flood of this type 
of e-mail. And I'll be offering an amendment shortly that will 
help in that regard as well.
    Mr. Frank. I thank the gentleman. I yield back.
    Chairman Sensenbrenner. Are there amendments?
    Mr. Goodlatte. Mr. Chairman?
    Chairman Sensenbrenner. The gentleman from Virginia, Mr. 
Goodlatte.
    Mr. Goodlatte. Mr. Chairman, I have an amendment at the 
desk.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    The Clerk. Amendment offered by Mr. Goodlatte to the 
amendment in the nature of a substitute to H.R. 718. On page 2, 
after line 19, insert the following: (c)----
    Mr. Goodlatte. Mr. Chairman, I'd ask unanimous consent that 
the amendment be considered as read.
    Chairman Sensenbrenner. Without objection, so ordered.
    [The amendment follows:] 
    
    
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Goodlatte. Thank you, Mr. Chairman.
    And, Mr. Chairman, let me start, in lieu of an opening 
statement, by saying that I thank you for holding this markup 
and congratulate you for the very narrowly tailored substitute 
that you are offering that I think goes a long way toward 
addressing this problem without encountering some of the 
proliferation of litigation and micromanagement of our 
commercial enterprise system, and goes a long way to avoiding 
the problem of legitimate uses of commercial e-mail that help 
make things easier for consumers and help make them aware of 
things, including issues related to copyright, as the gentleman 
from North Carolina mentioned, that I think are very important.
    I would also note that this is a growing problem. I hear on 
a weekly basis from constituents at home about their concern 
about spam. It is growing exponentially. And I do think we need 
to take measures to solve this problem, so I also commend the 
gentlewoman from New Mexico for the legislation that she 
offered. I think, however, this--this alternative moves us 
closer to the objective we're trying to seek.
    I have an amendment----
    Ms. Lofgren. Would the gentleman--I'm sorry.
    Mr. Goodlatte. I have an amendment that is intended to make 
this process more effective. And the fact of the matter is that 
right now law enforcement agencies are not going to give this 
problem the kind of attention that most of my constituents, 
most of all of our constituents would like them to give it. 
They are overtaxed in terms of their commitment to various 
enforcement measures, and this is not going to get as high a 
priority as I would like to see.
    We have an amendment that will give the Internet service 
providers the ability to help protect the consumers, and they 
have an incentive to do this because it causes enormous 
problems on their systems. It can call--cause smaller ISPs to 
crash when they're overloaded with spam, and it certainly hurts 
their business reputation. They are, in effect, the carrier who 
is providing this service to people who use e-mail.
    So this amendment will help to give them a very narrowly 
tailored cause of action. It does not give individuals a 
private right of action, but it does give the ISPs a narrowly 
tailored private right of action to enforce this. There is a--
--
    Ms. Lofgren. Would the gentleman yield?
    Mr. Goodlatte. Let me finish my statement. Then I'll be 
happy to yield.
    There is a very narrowly tailored precedent for this in the 
Telephone Consumer Protection Act of 1991, which was enacted in 
response to the overwhelming volume of unsolicited faxes, spam 
faxes. You can all remember the complaints that came out about 
that when people wanted to offer spamming of all kinds of 
commercial advertisements over your fax machines. While there 
are some exceptions to my statement, generally you don't get a 
lot of unsolicited commercial spam over your fax machine, and 
the reason is this Telephone Consumer Protection Act of 1991 
that helped to ensure compliance with these sorts of consumer 
protection laws. It had a $10 per violation--has, it's current 
law, $10 per violation, up to $500,000 statutory damage 
provision, and it has not led to a proliferation of lawsuits. 
It's had the opposite effect because it has worked to deter 
improper conduct and ensure better compliance with the law.
    And that's exactly what this amendment is intended to do as 
well, and I would urge my colleagues to adopt it, and I'd be 
happy to yield to the gentlewoman from California.
    Ms. Lofgren. Thank you, Mr. Goodlatte.
    In reading this amendment, I certainly understand the 
origin of the concern. My desire is to legislate as little as 
possible in the area of the Internet, and I think you feel 
similarly. And so the concern I have is whether this is 
necessary when it is possible for ISPs to bring a trespass 
action and protect themselves in that way.
    Mr. Goodlatte. Well, reclaiming my time, I understand that, 
and they definitely do have that right. The problem is that 
they have very little--remember, they're doing this as a 
service to their customers, and they have very little incentive 
to do it if, when they go to court, they have experienced very 
little by way of actual damages to themselves. And that's what 
happens when they simply bring----
    Chairman Sensenbrenner. Will the gentleman yield?
    Mr. Goodlatte. I would be happy to yield.
    Chairman Sensenbrenner. Let me say I think this amendment 
is an improvement to the bill. I'm not completely convinced 
that we don't need to further refine the amendment before this 
bill goes to the floor. But I think that the real meat of this 
amendment is the statutory damages provision where the ISP does 
not have to prove actual damages. You know, here in Section 
2(B) of the amendment, it's $5 per violation, not to exceed a 
total of a million, except that if during a 1-year period 
somebody sends out in excess of 20 million items of spam, then 
there's no such limit on liability.
    So I think that this makes it pay for the ISP to go to 
court to try to police its own self.
    Ms. Lofgren. Would the gentleman----
    Chairman Sensenbrenner. Without objection, the gentleman's 
given 2 additional minutes.
    Mr. Goodlatte. I'd be happy to continue to yield.
    Ms. Lofgren. The question I have is--I mean, we're talking 
about two goals here, if I'm understanding correctly. One is to 
incentivize ISPs to bring actions to deter unsolicited spam, 
and the second issue is to give remedies to ISPs who crash 
because of the volume, which is really the trespass case.
    So I'm just not sure that we need to--I mean, that's why we 
have a delete button. I mean, I don't know that I'm yet 
convinced that we need to incentivize ISPs to bring action 
against----
    Mr. Goodlatte. I think this is far superior to the 
competing bill, which would----
    Ms. Lofgren. Oh, I don't--I don't disagree with that.
    Mr. Goodlatte.--incentivize everyone to bring actions. This 
narrowly tailors it, and the evidence from the previous law, 
the Telephone Consumer Protection Act, has been that it does 
not incentivize action but, rather, it incentivizes people to 
not send unsolicited commercial e-mails. And, remember, this 
ties into the main portion of the chairman's substitute, so it 
relates to fraudulent actions as well.
    So this is a very, very narrowly tailored provision.
    Ms. Lofgren. I should have noted, before I made any 
comment, that I do very much appreciate that the substitute as 
well as this amendment is a considerable improvement over the 
underlying bill, and I do acknowledge that, although I do still 
have questions, and I thank the gentleman for yielding.
    Mr. Berman. Would the gentleman yield?
    Mr. Goodlatte. I would be happy to yield to the gentleman 
from California.
    Mr. Berman. Could the gentleman illustrate just what are 
the damages to an Internet service provider from conduit which 
would violate Subsection (A) of the amendment?
    Mr. Goodlatte. In many instances, an overload of spam can 
cause the server of the Internet service provider to crash, and 
that can have very substantial loss of all kinds of advertising 
revenue, of harm to their business reputation and so on. But in 
many instances, they are not heavily harmed themselves, but 
their customers are harmed by being overloaded with e-mail, 
many of which is of a fraudulent, illegal character.
    And if we simply wait for people to report to the various 
law enforcement agencies to attempt to enforce this and not 
give the Internet service providers, who are really the carrier 
in this case, the incentive to do this, what you wind up having 
is no action taken at all to address this problem. So this 
really adds some teeth to our legislation, and I think makes 
it, frankly, more competitive with the measure that passed the 
full House of Representatives last year by a 427 to 1 vote.
    Mr. Berman. So, in effect, this is to give sort of real 
meaning to what we're trying to discourage through the 
provision by providing a relatively easy way to remedy the 
problem.
    Mr. Goodlatte. Without causing a proliferation of 
litigation----
    Mr. Berman. Thank you.
    Mr. Goodlatte. It is narrowly targeted----
    Mr. Frank. Would the gentleman yield?
    Mr. Goodlatte. Yes, I would.
    Mr. Frank. I just had a question. Is this going to be 
precedential now, giving real meaning to what we do? I wonder 
if that is something we are going to follow, and----
    Mr. Goodlatte. No, I have cited the----
    Mr. Frank.--it can be very complicated.
    Mr. Goodlatte. We've already given real meaning in the 
past.
    Mr. Scott. Mr. Chairman?
    Chairman Sensenbrenner. Okay. The gentleman from Virginia 
is recognized for 5 minutes.
    Mr. Scott. Mr. Chairman, I rise in support of the 
amendment, but I had some questions to ask about what it does. 
It's been suggested that this, the amendment in the nature of a 
substitute with the amendment, will stop the flood of 
unsolicited e-mails. But the way I read it, it doesn't stop 
anything except anonymous or where the return address is 
misleading. Truthful e-mail, where it's coming from the vendor 
himself, and they properly identified, it seems like it's 
unlimited under the amendment in the nature of a substitute and 
the amendment. There's no limit to the amount; is that right?
    Mr. Goodlatte. If the gentleman would yield----
    Mr. Scott. Yeah.
    Mr. Goodlatte. That is partly correct, and that goes back 
to what the gentleman from Massachusetts said about giving 
individuals the right to be able to take their name off. That's 
not in our legislation, but it may well be because it is 
provided for in the legislation offered----
    Mr. Scott. There's nothing in the bill that addresses fraud 
or annoyance, one way or the other.
    Mr. Goodlatte. Well, but here's the point. The Internet 
service providers have mechanisms right now in place through 
technology to help cut back on the flood of that type of 
commercial e-mail. But what happens is that those who are bent 
upon committing fraudulent activity, which the chairman's mark 
addresses----
    Mr. Scott. Well----
    Mr. Goodlatte. If I could just finish that point.
    Mr. Scott. You mentioned fraud. Where is fraud?
    Mr. Goodlatte. The fraud is in the, in the chairman's 
underlying----
    Mr. Scott. I don't see fraud.
    Mr. Goodlatte. You have to look at the chairman's 
substitute.
    Mr. Scott. I'm looking at it. I don't see fraud. I see 
materially false and misleading. So, if you have the wrong 
address, whether it's fraudulent or not, if you have your right 
address and you're annoying people, that's no problem, but 
false and misleading as to the identity of the person means 
anonymous----
    Mr. Goodlatte. If the gentleman would yield, what commonly 
happens with this problem is that people steal other people's 
identification and use that to send the spam because the 
Internet service provider is able to detect large blocks of 
data being submitted, and what happens is there is they're able 
to block that. But if you break it down into a lot of smaller 
blocks, using other people's identity that you have falsely 
used, you are then able to circumvent the system. This is 
targeted at that activity.
    Mr. Boucher. Would the gentleman from Virginia yield?
    Mr. Goodlatte. I yield to my colleague from Virginia.
    Mr. Boucher. I thank the gentleman for yielding.
    The question that the gentleman from Virginia has asked is 
how is the bill effective in addressing the situation where the 
spammer has not falsified any of the header information, where 
he's using his own address? And the answer is that the Internet 
service providers have now begun to use software that can 
detect large volumes of e-mail that originate from a common 
source simultaneously and the software used by the ISP 
correctly interprets that e-mail to be spam. And so that filter 
employed by the ISP is sufficient to keep that spam from 
reaching the recipient.
    What the spammers have now started to do, in order to 
defeat that software, is change in each of the items of e-mails 
that goes out and each of the items of spam that is sent a 
little bit of the header information. The origination 
information may be altered in each subsequent message. The time 
that it is sent may be altered in each subsequent message just 
sufficiently to defeat the software that is used by the ISP as 
the filter.
    And what the legislation that the gentleman from Virginia, 
Mr. Goodlatte, has offered, which I am pleased to co-sponsor, 
and what his amendment, which I strongly support, would help to 
implement, is a means of criminalizing the way in which 
spammers are now defeating the ISP's software because it would 
say that you cannot falsify any of the header information. It 
is a sound approach. It entirely addresses the concern that my 
friend, to my left, from Virginia--that is where he normally 
sits, on my left--has raised, and I think it is the right way, 
in the most minimalist possible fashion, to address the genuine 
problems associated with spam.
    And I thank the gentleman for yielding.
    Mr. Scott. Reclaiming my time, Mr. Chairman. I think 
there's a typo at the bottom of Page 1, lines 15 and 16, 
``such'' is mentioned twice, and I think that could probably be 
taken out by unanimous consent.
    I yield back.
    Chairman Sensenbrenner. The question is on----
    Mr. Watt. Mr. Chairman?
    Chairman Sensenbrenner.--the adoption of the Goodlatte 
amendment.
    For what purpose does the gentleman from North Carolina 
seek recognition?
    Mr. Watt. I move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Watt. Mr. Chairman, unless I'm missing something here, 
we have started with a bill that was designed to protect 
consumers from annoying spam and have ended up with a bill that 
really doesn't do anything to help consumers be protected from 
annoying spam. And while this is a better bill than--probably 
drafted better, it does less. And this amendment, while it is 
better than nothing, doesn't give any remedy to the ultimate 
customer, which is, I mean, we didn't start off necessarily to 
protect the ISPs. I thought we started off this bill to protect 
customers.
    So, unless I'm missing something here, let me just ask Mr. 
Goodlatte a question. In the--in the phone context, is it only 
the phone company that can file a lawsuit against somebody who 
keeps calling you, and you tell them to quit calling or is it 
the customer?
    Mr. Goodlatte. I don't know the answer to that. I suspect 
it may also include the customer. However----
    Mr. Watt. Okay. But that's the parallel here. We've given 
a--your amendment gives a cause of action to the phone company, 
the service provider, but no cause of action to the customer.
    Mr. Goodlatte. Wood the gentleman yield?
    Mr. Watt. I'll yield.
    Mr. Goodlatte. I understand the gentleman's point. However, 
in no way, shape or form is an Internet service provider to be 
compared with the phone company which takes a complete hands-
off approach to what is going over its lines. The Internet 
service provider very much right now is very dedicated to 
controlling the amount of spam that goes over their system, and 
so we're--they're the best tool, far better than the individual 
consumer who, for $5, is not going to go to court to protect 
themselves against spam. But the Internet service provider 
faces a bigger problem.
    Mr. Watt. Then what's the problem with giving an individual 
customer the right to file a cause of action? I mean, that's 
the ultimate protection we have. And, you know, we can 
criminalize this stuff, you're absolutely right. The criminal 
authorities are going to do absolutely nothing in this context. 
The ISP may or may not do anything, but the ultimate 
beneficiary of this bill ought to be the customer, it seems to 
me. And----
    Mr. Goodlatte. I understand the gentleman's concern, but I 
do not believe that will be an effective remedy. It's a far 
more effective remedy to have the ISP----
    Mr. Watt. Let me see if I can get this----
    Mr. Goodlatte.--power to protect the consumer.
    Mr. Watt. Let me see if I can get this squarely before us, 
Mr. Chairman. I have an amendment to the Goodlatte amendment at 
the desk.
    Chairman Sensenbrenner. The gentleman has been recognized 
to strike the last word. You know, you've got to offer your 
amendment at the beginning.
    The gentleman from California--well, the gentleman from 
North Carolina still has the time.
    Mr. Watt. I ask unanimous consent to offer the amendment.
    Chairman Sensenbrenner. Without objection, and the clerk 
will report the amendment. The clerk is reporting the Watt 
amendment.
    The Clerk. Amendment offered by Mr. Watt to the Goodlatte 
amendment to the amendment in the nature of a substitute to 
H.R. 718. On Page 2, after line 19, insert the following: ``(c) 
Private Right of Action--''
    Mr. Watt. Mr. Chairman, I ask unanimous consent the 
amendment to the amendment be considered----
    Chairman Sensenbrenner. Without objection, so ordered.
    [The amendment follows:]

             Watt Amendment To Goodlatte Amendment

                          To H.R. 718

          Offered by Mr. Sensenbrenner and Mr. Conyers

  On page 2, after line 19, insert the following:
``(c) Private Right of Acton.--
  ``(1) Actions authorized.--A provider of Internet access 
service or a customer of such provider, if otherwise permitted 
by the laws or rules of a court of a State, may bring in an 
appropriate court of that State, or, if such laws or rules do 
not so permit, may bring in an appropriate Federal court, an 
action to recover for actual or statutory damages, as provided 
in subsection 2, and for costs, as provided in subsection 3.
  ``(2) Award of Damages.--A person committing a violation of 
subsection (a) is liable to a provider of Internet access 
service or a customer of such provider for either--
    ``(A) the actual damages suffered by the provider of 
        Internet access service; or
    ``(B) statutory damages, as provided in this paragraph. At 
        any time prior to final judgment in an action, a 
        provider of Internet access service may elect to 
        recover an award of statutory damages for each 
        violation of subsection (a) in the sum of $5 per 
        violation, not to exceed a total of $1 million: 
        Provided, That, during any one-year period for which 
        the defendant has transmitted in excess of 20 million 
        unsolicited commercial electronic mail messages, no 
        such limit on liability shall exist.
  ``(3) Attorneys Fees.--In any action brought under paragraph 
(1), the court may, in its discretion, require the payment of 
the costs of such action, and may assess reasonable costs, 
including reasonable attorneys' fees, against any person found 
to have committed a violation of subsection (a).''.

    Chairman Sensenbrenner. And the gentleman from North 
Carolina is recognized for 5 minutes.
    Mr. Watt. Thank you, Mr. Chairman. I hope this came out 
good enough on the copy because I wrote it in.
    Basically, what I'm doing, in two places, one on the first 
line, on the first line of subparagraph (c), I'm inserting 
language that would give a customer the same right to a cause 
of action as the Internet access service provider.
    And in paragraph (2), also, subparagraph (2), I'm inserting 
that same, the same language.
    Ms. Lofgren. Read it, Mel, because you can hardly read it. 
What is it, ``or a customer--''
    Mr. Watt. It says, ``A provider of Internet access service 
or a customer of such provider,'' and that gets inserted on--in 
that first line, and it gets inserted in the second line of 
subparagraph (2).
    Ms. Lofgren. Mr. Chairman?
    Mr. Watt. Now, maybe--maybe this will never be used, but I, 
I mean, if I'm a customer, I think all of this is designed for 
the benefit of the ultimate customer. The Internet was not 
designed for the ISPs, the--it wasn't, I mean, any more than 
telephones were designed for the telephone company. Now maybe 
that's not a good parallel. I acknowledge that there is a 
difference, but I don't think criminalizing this is going to 
make a snip of difference in what happens in our life. The 
criminal law is never going to address this issue, and I don't 
think Internet service providers are going to be the ultimate 
people who address this issue. If you don't give the right to 
the ultimate customer, then I think it's never going to be 
addressed.
    Mr. Goodlatte. Mr. Chairman?
    Chairman Sensenbrenner. Would the gentleman yield back the 
balance of his time? Would the gentleman yield back? Mr. Watt?
    Mr. Watt. I do, yes, Mr. Chairman.
    Chairman Sensenbrenner. For what purpose does the gentleman 
from Virginia, Mr. Goodlatte, seek recognition?
    Mr. Goodlatte. Move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Goodlatte. Thank you, Mr. Chairman.
    Mr. Chairman, I will have to oppose this amendment because 
I think it's going to put us back in the direction of the major 
complaint about the legislation passed out of the Commerce 
Committee that it could provide a proliferation of litigation. 
I don't know if it will or not. It provides for attorneys' fees 
so somebody may think that because it provides for attorneys', 
even if they only have $5 in damages, that they're going to go 
ahead and bring a lawsuit for that purpose. I don't think that 
is necessary.
    And I think the clear distinction here between this and the 
right of action that I don't know, but I assume may exist, 
under the earlier law related to faxes is that Internet service 
providers do have a very strong incentive, I do believe they 
will be in there aggressively combating those who flagrantly 
abuse this law and who do a multitude of faxes to thousands of 
people, no one of whom has any real incentive to take the 
action here, but they clearly do, and I think that we can 
narrowly provide for a way to give consumers very good 
protection without being accused of opening up--this up to a 
proliferation of litigation, and therefore I have to oppose the 
amendment to the amendment.
    Ms. Lofgren. Would the gentleman yield?
    Mr. Goodlatte. I yield to the gentlewoman.
    Ms. Lofgren. Thank you for yielding.
    I agree that this amendment offered by my esteemed 
colleague is one that I cannot support, and it's not because I 
don't care about consumers versus ISPs, it's we should not 
legislate where there is no need for passing laws. And right 
now the technology is more efficient to protect us than a 
Federal law. I mean, there are free sites that if you e-mail 
the offense--the offending spam to them for free, they will 
block all further spam.
    I mean, there's--we don't need to pass a law. We don't need 
to clog up courts because the technology is way ahead of what 
we're doing here, and therefore I, although I appreciate the 
motivation of the amendment, I don't think it's an appropriate 
thing to do, and I still have reservations about the underlying 
Goodlatte amendment, at least as to 2(B).
    But I yield back, and I thank the gentleman for yielding.
    Mr. Issa. Mr. Chairman?
    Mr. Goodlatte. I yield to the gentleman from California.
    Mr. Issa. I'll make it very quick. I see that there is no 
reason, again, for this amendment to Mr. Goodlatte's amendment. 
However, trying to kill two birds with one stone, for my 
colleagues, please understand from my experience specifically 
in this industry that what Mr. Goodlatte is trying to do here 
is to provide a legal remedy for that which cannot easily be 
technologically caught, and that is extremely important because 
this is a tool that the ISPs do not have today, and that is the 
proliferation of ``sneaky'' mail, if you will, this fraudulent 
mail.
    By giving the ISPs the ability, on behalf of their 
customers, to provide this type of protection for themselves 
and their paying customers, we do what we really need to do, 
while both the ISP and the individual customer, with Outlook 
and other e-mail-receiving devices, have the ability to screen 
those pieces of mail which have a consistent address after the 
first time.
    So, between the ISP and the consumer, we have tremendous 
power in the technology today, and I recommend that you look 
favorably on the Goodlatte amendment because it takes the one 
piece of the puzzle that doesn't exist today, it closes that 
loophole, and I believe we will all benefit very quickly from 
this change in the power of the ISP. And then if it doesn't 
work completely, I will be the first to come back to this body 
and say we have to do more. But I believe this will take care 
of 99 percent.
    Ms. Jackson Lee. Would the gentleman yield? Would the 
gentleman yield?
    Mr. Issa. I'd be happy to yield to the gentlewoman from 
Texas.
    Ms. Jackson Lee. Let me, first of all, I support your 
amendment, Mr. Goodlatte, and taking the gentleman's comments, 
the prior speaker's comments, Issa, comments about the value of 
this particular amendment to the ISP community, why not give 
the same limited leverage, if you will, to a customer, as Mr. 
Watt's amendment has offered?
    And I guess I will ask the question and yield back to you. 
Does your amendment do anything, and this collective management 
amendment, do anything on the issue of pornography? Because 
when the witnesses were before on the other bill, the Wilson 
bill, they were talking about that. When I say ``the 
witnesses,'' the members who were presenting their bills, they 
were talking about that. Can you help me on both the question 
as to why we wouldn't want to give the same privilege to the 
customer, and also my last point is whether or not this is a 
criminal action. I heard Mr. Boucher say that, and I don't see 
it. It looks like a private right of action.
    I yield back to the gentleman.
    Mr. Goodlatte. Well, my time has expired. If the gentleman 
would yield--if the chairman would yield me an additional 
minute.
    Ms. Jackson Lee. Can I yield him an additional minute?
    Chairman Sensenbrenner. Without objection, the gentleman is 
recognized for an additional minute.
    Mr. Goodlatte. I thank the chairman.
    Ms. Jackson Lee. I yield back. Thank you, Mr. Goodlatte.
    Mr. Goodlatte. In response to the gentleman, yes, my 
amendment will be a very effective tool to combat pornography 
on the Internet because it will, that is one of the prime 
violators of this false identification that is used for people 
to spam other people. You'll hear some friends of yours or 
constituents say, ``Well, I got somebody who I thought was a 
friend of mine sent me pornographic material over the 
Internet.'' Well, they didn't send it to you. Someone stole 
their identification and sent it to them, and this is a very 
serious problem. The Internet service providers want this 
amendment. They strongly support this amendment in order to be 
able to combat that.
    My reservation about going a step further of giving it to 
the individual consumer is that the criticism we have faced is 
that we're going to provide for a proliferation of litigation, 
particularly where we allow for attorneys' fees in this 
amendment. And, therefore, people who have a $5 statutory 
damage I don't think ought to be bringing an action like that. 
Let me consoli--they can also--they can complain to the 
Internet service provider. They can also complain to the 
various Government enforcement agencies.
    Chairman Sensenbrenner. The time of the gentleman has 
expired.
    Mr. Berman. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from California, Mr. Berman, seek recognition?
    Mr. Berman. Thank you, Mr. Chairman.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Berman. Yes. The gentleman from Virginia is persuading 
of the wisdom of his amendment for two reasons: One is there is 
actual damages to the Internet service provider when the volume 
of mail as a result of this kind of false header, spam mail 
causes the server to crash, but then the ISP can also be sort 
of a surrogate plaintiff for all the annoyances and 
inconveniences and other damages that the individual consumers 
face.
    It's hard for me to quite understand why giving the 
individual consumer the right of action automatically results 
in proliferation. You seem to think it is the attorneys' fees 
part of that that makes that so. But the one flaw in this is 
you have two provisions in here, actual damages and statutory 
damages. Actual damages that the ISP suffers they collect for, 
if it's not greater than the statutory damages. Now, as 
surrogate, they collect what could be substantial amounts of 
funds from the offender on behalf of the consumer, but the 
provision to return it to the consumer isn't included in this 
amendment.
    So it almost--this becomes a new revenue source for them 
for damages they didn't suffer, the consumer suffered.
    Mr. Goodlatte. If the gentleman would yield, that problem 
has been anticipated. That's why we put a, I think, a low cap 
on this. It's comparable to the low cap that is on the other 
previous bill.
    Mr. Berman. Oh, I see.
    Mr. Goodlatte. And the hope is that it will be a deterrent 
rather than an incentive to do that.
    Mr. Frank. Mr. Chairman?
    Chairman Sensenbrenner. Does the gentleman yield back?
    Mr. Frank. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from Massachusetts seek recognition?
    Mr. Frank. To strike the requisite number of words.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Frank. I want to speak in favor of the gentleman's from 
North Carolina's amendment. The gentlewoman from California 
argued that the gentleman from North Carolina's amendment is 
unnecessary because of technology, and I think she acknowledged 
her uncertainty about her feelings about the underlying 
amendment. I would think her argument would be, if it's 
technologically unnecessary for the Watt amendment, then the 
Goodlatte amendment is also technologically unnecessary, and I 
appreciate the consistency with which she stated her point. But 
it does seem to me it applies with equal force, both to the 
underlying amendment and the secondary amendment.
    And I'm all for the secondary amendment. I think we're 
getting kind of ``big brotherly'' here. The notion is that the 
consumer need not worry. Her independent service provider will 
take care of her, and I think people may have developed this 
kind of warm relationship with their ISP, and they may be 
prepared to designate the ISP as their next friend and have the 
ISP be the defender of their rights. But in those cases where 
people aren't prepared to yield their rights to the ISP, I 
think they ought to be able to retain them.
    And, also, it seems to me there are a couple of points 
here. One, the gentleman from Virginia correctly said the ISP 
can step in when this becomes a flagrant abuse. Well, what's a 
flagrant abuse as an ISP as a whole may be a higher threshold 
than a flagrant abuse to an individual group of individuals. It 
may well be that particular individuals are targeted by 
particular marketing operations, but this doesn't rise to the 
level of interference with the ISP.
    It is possible for an individual to be given serious 
problems with an excess of unwanted commercial e-mail long 
before it's going to crash the system. And so it does seem to 
me that the logic of giving this right of action to protect, 
with all of the safeguards that the gentleman said. The 
gentleman from North Carolina's amendment plugs into the 
gentleman from Virginia's scheme. So the caps, and the low 
level, the $5, that's all in there.
    I just think that there is really very little argument for 
the notion that the interest of the individual consumers and 
the ISP will be so substantially identical that they can be 
merged and that the individual can have that right given to the 
ISP.
    There is also the case that there may be some other 
commercial interests involved between the ISP and some of the 
marketers. Maybe there are other factors here. But the general 
point is I think the gentleman from Virginia has a very 
thoughtful scheme. It is a reasonable way to go.
    The flaw I think is that it assumes that there is, as I 
said, an identity or a virtual identity between the individual 
consumer and the ISP. And some of the arguments he gave about 
why the ISP will jump in, and clearly they would, don't apply. 
There may be consumer problems that don't reach that level. So 
I think that the gentleman from North Carolina's amendment is a 
very reasonable one, and I intend to support it.
    Ms. Hart. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the 
gentlewoman from Pennsylvania, Ms. Hart, seek recognition?
    Ms. Hart. Mr. Chairman, to address the issue that was 
raised by----
    Chairman Sensenbrenner. The gentlewoman is recognized for 5 
minutes.
    Ms. Hart. Thank you, Mr. Chairman. I move to strike the 
last word.
    In response to the issue raise by Ms. Jackson Lee regarding 
none of these amendments addressing the issue that was brought 
up at our hearing regarding pornography, I do have an amendment 
at the desk to offer that may address her concerns.
    I yield back the balance of my time.
    Ms. Jackson Lee. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the 
gentlewoman from Texas seek recognition?
    Ms. Jackson Lee. To strike the last word, Mr. Chairman.
    Chairman Sensenbrenner. The gentlewoman is recognized for 5 
minutes.
    Ms. Jackson Lee. Let me, the, as I indicated, I am 
supporting Mr. Goodlatte's amendment, but I'm also supporting 
Mr. Watt's amendment. What I would suggest to Mr. Goodlatte is 
the same attributes attributed to the ISP community, which is 
that they would not be necessarily litigious, unnecessarily; 
meaning just to litigate. They have a cause. And I would say to 
you that users likewise, consumers, will pose or be in the same 
category, that their real concern is to be able to use the 
Internet unfettered and to not be attacked, if you will, by a 
proliferation of unnecessary or unsolicited intrusions.
    I would offer to say that this makes your amendment better, 
if you can respond to their concerns, as well, and I just 
looked at my colleague, Mr. Weiner, and he turned and said 
class action. He'll probably speak on it himself. But the point 
is there are a variety of ways that you can handle this. I 
think that we are doing a much better task of responding to the 
concerns if we allow the opportunity for the consumer to 
likewise press their cause along with the ISP community.
    The other point is I was not clear--I asked this question 
before--this is a private right of action, as I understand it. 
This is not a criminal action. And if anyone has a response to 
that, and I heard my colleague from Virginia, Mr. Boucher, I 
thought, say criminal. I don't want to put words in his mouth, 
but this looks like a private action amendment versus criminal 
charges. And if anyone has a basis of correcting that, I will--
--
    Mr. Weiner. The base bill----
    Ms. Jackson Lee. I'm sorry. I'll yield to Mr. Weiner.
    Mr. Weiner. I think the reference was that the base bill 
has a criminal charge.
    Ms. Jackson Lee. The base bill. Thank you very much for 
that clarification.
    In any event, let me just say that I think that the 
amendment should include protections for consumers, as well, 
and I would support both amendments.
    I yield back.
    Mr. Weiner. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from New York, Mr. Weiner, seek recognition?
    Mr. Weiner. Move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Weiner. Thank you, Mr. Chairman.
    What troubles me in this debate about the Goodlatte 
amendment is we seem to be misunderstanding who the victim of 
spamming is and who we intended to be addressed when the 
original, when H.R. 718 was considered in this committee. The 
victim is the recipient of the e-mail. The victim who has very 
little recourse that I think we're trying to address with all 
of the legislation is that person.
    I don't dispute Mr. Goodlatte's point that the ISP has the 
incentive. I would argue they also have the tools to defend 
themselves. There has been, several members here have talked 
about the technological advantage that have allowed ISPs to 
foil spammers that they wanted to stop. This seems to me the 
ISPs have a technical problem that is going to find, in 
eventuality, a technical solution.
    Mr. Goodlatte has been forceful, and I think very clear-
minded, in this committee in reminding us that very often 
technical problems need technical solutions. The victim of 
spamming is the individual. And I have to tell you my concern 
about the Goodlatte amendment is that, frankly, the idea that 
this is going to weed out fraud I think might be oversold. I 
think it's going to allow ISPs to harass its customers that it 
doesn't like.
    Materially false or misleading, that's not a very narrow 
standard. If someone puts bob at mailhouse.com or joe at 
mailhouse.com, and there's no one named Joe there or Joe Smith, 
and there's no one named Joe Smith or administrator, I don't 
think that this necessarily solves the problem that we seek to.
    I'm concerned that we're trying, with the Goodlatte 
amendment, to give the ISPs something that they should be doing 
technologically, and all its indications are that they are. The 
victims of spamming is the individual who gets spammed. And I 
think that if you're going to give some civil course of action, 
there is no--there hasn't been any argument from the other 
side, from the opponents of the amendment to the amendment, 
about why it is they shouldn't have that right.
    You can say, well, that there's a greater incentive on the 
ISPs to go out and do it. Well, perhaps that's right. It's not 
really their--it's not really their problem to solve, and if it 
is, they're the ones that have the technology to be able to 
solve the problem, and I expect they will.
    Mr. Cannon. Would the gentleman yield?
    Mr. Weiner. Certainly.
    Mr. Cannon. May I just point out I think, referring back to 
the gentlewoman from California when she said that's the reason 
we have a delete button, people on the Internet are not 
victims. This is not a matter of victimization. Whatever your 
conclusions about this amendment, I don't think we need to be 
thinking in terms of people whom we've empowered with 
technology as being victims.
    Thank you.
    Mr. Weiner. Oh, I mean, obviously there's got to be a 
victim and a crime, and we have a bill here that--crime----
    Mr. Cannon. This bill does not have crime. That's the 
underlying bill, as you pointed out just a moment ago.
    Mr. Weiner. I don't know. It says here in the committee 
report that the first spamming offense is punishable by a fine 
up to--of a fine up to $100,000 if death does not result.
    I mean, spamming is pretty bad. It rarely results in death.
    Mr. Watt. Will the gentleman yield?
    Mr. Weiner. The second offense can trigger a fine, 
imprisonment of not more than 1 year or both.
    It sounds to me, Mr. Cannon, that that is a crime.
    I would be glad to yield.
    Mr. Watt. I would say to the gentleman that the underlying 
civil action is a civil action for the same misconduct that the 
underlying bill covers. It doesn't cover anything beyond the 
underlying bill. So this is not a generalized cause of action 
just because you get spammed. This is a cause of action for the 
misconduct that occurs under the underlying bill for which you 
have a criminal penalty, and now you turn around and say that 
this criminal activity doesn't even justify a civil cause of 
action.
    Mr. Weiner. If I could just reclaim my time, very briefly. 
Another thing that's complex about this is materially false and 
misleading to whom? To the recipient? The ISP is then going to 
step in, and then they're going to bring a case to court 
saying, ``Well, the ISP found it misleading,'' or are they 
going to have then bring in the recipients of the spam and get 
them individually on the stand and say, ``Well, did you find 
this misleading? Was this materially false, as far as you're 
concerned?''
    The ISP is not the victim here. So to give them the right 
to go to court when they have other tools at their disposal; 
i.e., a program which manages to stop this program.
    I yield back my time.
    Chairman Sensenbrenner. The question is on the amendment 
offered by the gentleman from North Carolina, Mr. Watt to the 
amendment offered by the gentleman from Virginia, Mr. 
Goodlatte.
    Those in favor will signify by saying aye.
    Opposed, no.
    The nos appear to have it.
    Mr. Watt. Could we have a----
    Chairman Sensenbrenner. A recorded vote is ordered.
    This in favor of the Watt amendment will, as your names are 
called, vote aye. Those opposed, will be vote no, and the clerk 
will call the roll.
    The Clerk. Mr. Hyde?
    [No response.]
    The Clerk. Mr. Gekas?
    Mr. Gekas. No.
    The Clerk. Mr. Gekas, no. Mr. Coble?
    Mr. Coble. No.
    The Clerk. Mr. Coble, no. Mr. Smith?
    Mr. Smith. No.
    The Clerk. Mr. Smith, no. Mr. Gallegly?
    [No response.]
    The Clerk. Mr. Goodlatte?
    Mr. Goodlatte. No.
    The Clerk. Mr. Goodlatte, no. Mr. Chabot?
    Mr. Chabot. No.
    The Clerk. Mr. Chabot, no. Mr. Barr?
    [No response.]
    The Clerk. Mr. Jenkins?
    Mr. Jenkins. No.
    The Clerk. Mr. Jenkins, no. Mr. Hutchinson?
    Mr. Hutchinson. No.
    The Clerk. Mr. Hutchinson, no. Mr. Cannon?
    Mr. Cannon. No.
    The Clerk. Mr. Cannon, no. Mr. Graham?
    [No response.]
    The Clerk. Mr. Bachus?
    [No response.]
    The Clerk. Mr. Scarborough?
    [No response.]
    The Clerk. Mr. Hostettler?
    [No response.]
    The Clerk. Mr. Green?
    Mr. Green. No.
    The Clerk. Mr. Green, no. Mr. Keller?
    Mr. Keller. No.
    The Clerk. Mr. Keller, no. Mr. Issa?
    Mr. Issa. No.
    The Clerk. Mr. Issa, no. Ms. Hart?
    Ms. Hart. No.
    The Clerk. Ms. Hart, no. Mr. Flake?
    [No response.]
    The Clerk. Mr. Conyers?
    Mr. Conyers. Aye.
    The Clerk. Mr. Conyers, aye. Mr. Frank?
    Mr. Frank. Aye.
    The Clerk. Mr. Frank, aye. Mr. Berman?
    Mr. Berman. Aye.
    The Clerk. Mr. Berman, aye. Mr. Boucher?
    [No response.]
    The Clerk. Mr. Nadler?
    Mr. Nadler. Aye.
    The Clerk. Mr. Nadler, aye. Mr. Scott?
    [No response.]
    The Clerk. Mr. Watt?
    Mr. Watt. Aye.
    The Clerk. Mr. Watt, aye. Ms. Lofgren?
    Ms. Lofgren. No.
    The Clerk. Ms. Lofgren, aye. Ms. Jackson Lee?
    Ms. Lofgren. No.
    The Clerk. I'm sorry?
    Ms. Lofgren. I said no.
    The Clerk. Oh, I'm sorry. Ms. Lofgren, no.
    Ms. Jackson Lee?
    Ms. Jackson Lee. Aye.
    The Clerk. Ms. Jackson Lee, aye. Ms. Waters?
    Ms. Waters. Aye.
    The Clerk. Ms. Waters, aye. Mr. Meehan?
    [No response.]
    The Clerk. Mr. Delahunt?
    [No response.]
    The Clerk. Mr. Wexler?
    [No response.]
    The Clerk. Ms. Baldwin?
    Ms. Baldwin. Aye.
    The Clerk. Ms. Baldwin, aye. Mr. Weiner?
    Mr. Weiner. Aye.
    The Clerk. Mr. Weiner, aye. Mr. Schiff?
    Mr. Schiff. Aye.
    The Clerk. Mr. Schiff, aye. Mr. Chairman?
    Chairman Sensenbrenner. No.
    The Clerk. Mr. Chairman, no.
    Chairman Sensenbrenner. Are there additional members in the 
room who wish to cast/change their vote?
    The gentleman from Alabama?
    Mr. Bachus. No.
    The Clerk. Mr. Bachus, no.
    Chairman Sensenbrenner. Anybody else? If not, the clerk 
will report.
    The gentleman from Arizona, Mr. Flake?
    Mr. Flake. No.
    The Clerk. Mr. Flake, no.
    Chairman Sensenbrenner. The gentleman from Georgia, Mr. 
Barr?
    Mr. Barr. No.
    The Clerk. Mr. Barr, no.
    Mr. Chairman, there are 10 ayes and 17 nays.
    Chairman Sensenbrenner. And the amendment to the amendment 
is not agreed to.
    Ms. Lofgren. Mr. Chairman?
    Chairman Sensenbrenner. The gentlewoman from California, 
for what purpose do you seek recognition?
    Ms. Lofgren. I have an amendment to the amendment at the 
desk.
    Chairman Sensenbrenner. The clerk will report the amendment 
to the amendment.
    Ms. Lofgren. I ask unanimous consent that the amendment be 
considered as read.
    Chairman Sensenbrenner. Well, let's take a look. The clerk 
will report----
    The Clerk. Amendment offered by Ms. Lofgren to the 
amendment offered by Mr. Goodlatte to the amendment in the 
nature of a substitute to H.R. 718.
    In Subsection (c)(2)----
    Chairman Sensenbrenner. Without objection, the amendment is 
considered as read.
    [The amendment follows:] 
    
    
    Chairman Sensenbrenner. And the gentlewoman from California 
will be recognized for 5 minutes.
    Ms. Lofgren. Thank you, Mr. Chairman.
    In looking at the underlying Goodlatte amendment, I guess 
I'm becoming convinced that there's value in providing a very 
clear cause of action for an ISP that has been damaged through 
the volume of e-mails. And I mentioned earlier an instance, it 
wasn't an ISP issue, but it was a situation akin to this, where 
a company in my county proceeded on a trespass cause of action 
successfully because the intrusion on its system actually 
caused damage to their servers, and I think that that is fair 
enough. But it's not necessarily clear that that cause of 
action is provided for in every State, and certainly under 
Federal law. And so I think there is value in providing the 
clear protection for someone damaged in that matter.
    However, I am not convinced that Section (2)(B), which I 
would strike under this amendment to the amendment, is 
necessary. It seems to me that it would provide the opportunity 
for individuals who did not suffer much damage to go in and 
recover large amounts of money. Now, I understand there's a 
million-dollar cap, but to me half a million dollars is real 
money too. I mean, that's a lot of money, at least in my 
household. And so I'm not sure that it's--that's necessary.
    I also think, and I think this would be difficult to prove, 
but there was a lot of discussion about providing rights for 
the recipients of e-mail, that they are the ones who really 
should be the subject of our concern. And so in my amendment, I 
would suggest that we, in addition to the ISPs who could bring 
action, we add e-mail recipients in Section (c)(1) and allow 
individuals, as well as ISPs, to go to court and prove and 
recover their actual damages, not a statutory scheme.
    Now I'm not sure how an individual is going to prove that 
they had an actual damage from spam, but if they can do so, 
more power to them. I think that this proposal would really 
codify the trespass type of cause of action, would allow for 
ISPs to correct their actual damages from attacks or really 
service access problems, and would avoid the concern that I 
have, which is that we are legislating in an area that we don't 
need to legislate, where the technology will provide more 
protection than the Federal law.
    I don't think that we ought to be passing laws 
unnecessarily in the area of the Internet, and I hope that 
the----
    Mr. Conyers. Would the gentlelady yield?
    Ms. Lofgren. I would certainly yield to the gentleman.
    Mr. Conyers. Well, I think that this is a more perfect 
solution really. I've been concerned about the ISPs getting 
away with a million dollars in damage awards. These guys have 
good lawyers too. So let's, let's turn it back to the e-mail 
user, to the person that got spammed, and I think you'd do both 
of these in a very commendable way. I'm going to support the 
amendment.
    Ms. Lofgren. Thank you. Mr. Chairman----
    Mr. Nadler. Mr. Chairman?
    Chairman Sensenbrenner. The time belongs to the gentlewoman 
from California.
    Ms. Lofgren. Could I yield to Mr. Goodlatte, who I think 
is----
    Mr. Goodlatte. I seek my own time.
    Ms. Lofgren. All right. I will yield to the gentleman.
    Mr. Nadler. Would the gentlelady yield?
    Ms. Lofgren. Yes.
    Mr. Nadler. As I read your amendment, you do partially what 
Mr. Scott wanted to do--I'm sorry, what Mr. Watt wanted to do. 
I don't know why I did that--what Mr. Watt wanted to do. But 
then you eliminate the actual damages, I mean, the statutory 
damages.
    Ms. Lofgren. Correct.
    Mr. Nadler. And you limit it to actual damages. Can you 
tell me under this, if the bill were amended as you want, what 
the measure of damages from a spam is? How do you measure those 
damages?
    Ms. Lofgren. Well, that's why I'm saying I'm not sure how 
an individual proves up actual damage from receiving an e-mail 
that they can delete, but I will tell you how an ISP would 
prove actual damages, which is the volume itself causes their 
computers to crash, requires them to go out and purchase ten 
more servers because they can't handle the volume of unwanted 
e-mail. That's the kind of case that's been put together on the 
trespass cases, and I think that's fair and legitimate.
    Mr. Nadler. Can I ask you a further question?
    Ms. Lofgren. Certainly.
    Mr. Nadler. If the bill were banning unsought e-mail, I 
understand your measure of damages for the ISP, but is 
banning----
    Chairman Sensenbrenner. The time of the gentlewoman has 
expired.
    Mr. Nadler. Mr. Chairman, could I ask unanimous consent for 
one additional minute?
    Chairman Sensenbrenner. Without objection.
    Mr. Nadler. Thank you.
    But the bill bans unsolicited fraudulent e-mail. How would 
the--and the measure of damages is they have to buy an extra, 
the mach--the computer or whatever, how would they know when 
the headers are fraudulent?
    Ms. Lofgren. Well, the Goodlatte amendment to the amendment 
I think creates--it goes beyond the underlying bill. But I 
would note that the underlying amendment put together by Mr. 
Conyers and the chairman really relates to fraudulent headers, 
not to fraudulent content. And I agree with that because just 
because something's on the Internet doesn't make it exempt from 
the underlying fraud statutes already in the criminal code. We 
don't need to create another criminal code for the Internet.
    I believe my time has expired.
    Chairman Sensenbrenner. The gentlewoman's time has once 
again expired.
    The gentleman from Virginia, Mr. Goodlatte?
    Mr. Goodlatte. Thank you, Mr. Chairman. I move to strike 
the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Goodlatte. Mr. Chairman, I must reluctantly oppose this 
amendment. I have great respect for the gentlewoman, but I 
think the gentleman from New York's point is exactly the case 
here, and that is that by removing the statutory damages, we're 
taking out the provision that is based upon the precedent of 
the 1991 law that gives the Internet service provider the 
incentive to take an action here in the cases that don't 
involve circumstances where their system crashes, and they can 
actually show some significant damage.
    But in those cases where, for example, you have the 
pornographic spammer that we've been talking about earlier, we 
are effectively taking away the incentive for them to act in 
response to the complaints of their customers to take a 
collective action. We're not expanding the number of cases of 
litigation which she also does by adding the individual 
recipient in here. But then if they can't show any actual 
damages under the law, they're not going to take an action and 
neither is the Internet service provider.
    So I think this would have the contrary effect of what many 
on the other side of the aisle spoke about earlier of wanting 
to have some action taken. They wanted to go a step further 
than I wanted to go, and many others wanted to go, and actually 
give that statutory damage to the individual, as well as to the 
ISP. But now we're going to go the opposite direction and not 
have any incentive for any action to be taken, and we will not 
have this added tool, which is based upon a law, a 1991 law, 
that has worked well to have a strong disincentive.
    The gentlewoman is right, a million dollars can be 
considered a lot of money. The people we want to consider it a 
lot of money are these fraudulent spammers. We want them to 
say, ``Well, I'm not going to risk a million dollars, so I'm 
not going to do this activity any more,'' and that's why I must 
oppose the amendment.
    Ms. Lofgren. Would the gentleman yield for----
    Mr. Goodlatte. I would be happy to yield.
    Ms. Lofgren. As the gentleman knows, because we've had an 
opportunity to discuss this outside of the public hearing, I do 
believe that there is a legitimate issue relative to sexually 
explicit e-mails that I believe should be tagged so people can 
be alert, so that they can delete them and not open them. But I 
think that the proper remedy for that kind of damage or assault 
is to go directly towards a requirement of labeling material 
that's unsuitable for minors rather than creating a statutory 
scheme.
    Mr. Goodlatte. Reclaiming my time. I respect that, but 
we've had several court challenges on our ability to define 
exactly what that is that must be labeled. Here we don't get 
into that issue, and there are plenty of other types of 
fraudulent, false, misleading spam, where headers are stolen 
and so on, that doesn't involve pornography, that consumers 
would also want to have addressed.
    Mr. Frank. Would the gentleman yield?
    Mr. Goodlatte. I've had the frustration--I will in just a 
second. I've had the frustration myself of trying to 
unsubscribe when I've gotten unsolicited commercial e-mail and 
have found that there's no way to find who it was that sent it 
to me because they used a false e-mail address, and this tool 
will address that.
    I yield to the gentleman from Massachusetts.
    Mr. Frank. I thank the gentleman.
    The question of pornography has come up or sexually 
oriented mail, and the gentlewoman referred to having markings 
on it, and I know we're going to get an amendment on that. I 
just want to point out, and people said, ``Well, if it's got 
the marking on it, you can then delete it.''
    I would also point out, for those people who find that 
they're getting more e-mail than they can read, the marking 
might also be interpreted for them as a reason to open it. So 
we ought to be very clear that the markings on the pornography 
can go both ways. There might be a signal that this is 
something you want to read or there might be a signal it's 
something you don't want to read, it seems to me, that's 
somewhat content neutral.
    Chairman Sensenbrenner. Would the gentleman yield back?
    Mr. Goodlatte. I yield back. Thank you.
    Mr. Watt. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from North Carolina seek recognition?
    Mr. Watt. Thank you, Mr. Chairman. First of all, I would 
like to----
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Watt. I'd like to request a division of the----
    Chairman Sensenbrenner. How does the gentleman propose to 
divide the amendment?
    Mr. Watt. I wish to divide the first part, the striking of 
subparagraph (B) from the rest of the amendment, and I 
obviously would speak in favor of the rest of the amendment. 
It, more artfully, does----
    Chairman Sensenbrenner. Okay. The question will be divided 
in the amendment in front of the members, the first paragraph 
which begins, ``In subsection (2),'' through the end of (B), 
closed paren, period, is the first part that will be voted on, 
and then the rest of the Lofgren amendment will be the second 
part that's voted on.
    And the gentleman from North Carolina is recognized for 5 
minutes.
    Mr. Watt. Thank you, Mr. Chairman. I will be brief.
    I've already spoken on the second part. I think Ms. 
Lofgren's wording is much more articulate than my wording was 
in the prior amendment. It is essentially the same concept, 
however.
    But once you, if we were to adopt the second part, 
basically, you would--the first part would eviscerate whatever 
cause of action there would be because the amount of effort it 
would take--well, I can argue both sides.
    Mr. Conyers. Would the gentleman yield?
    Mr. Watt. Let me argue both sides, as a good lawyer does. I 
could argue, number one, that it might increase the amount of 
litigation because, basically, any kind of conceivable harm 
could be the basis of a cause of action, but I think it's more 
likely to wipe out all causes of action because the harm to any 
individual would be so de minimus that it would be virtually 
not in an individual's interests to file a cause of action.
    Mr. Conyers. Would the good lawyer yield?
    Mr. Watt. Yes. Yes, sir.
    Mr. Conyers. Did the author seek a division?
    Mr. Watt. Yes.
    Mr. Conyers. She did.
    Ms. Lofgren. No, I didn't.
    Mr. Watt. I did.
    Mr. Conyers. Oh, you did.
    Mr. Watt. Yes.
    Mr. Conyers. But the author of the amendment that you're 
dividing, did she seek an amendment--a division?
    Mr. Watt. No.
    Mr. Conyers. Oh, she didn't. Okay. I thank the good lawyer.
    Mr. Watt. I yield to Ms. Lofgren.
    Ms. Lofgren. I would just note that unless we strike the 
statutory damage section, I would oppose the rest of the 
amendment because the whole point I'm trying to make is that if 
there--I don't want a lot of litigation about e-mail that you 
can delete. I don't think we ought to be creating a whole 
Federal statutory scheme for a minor annoyance.
    On the other hand, if you can prove that you have actually 
been damaged, I think that having a clear cause of action, both 
for individuals, as well as ISPs, is appropriate. And so I 
think each member, my understanding of the rules has a right 
under our rules to divide the question.
    Chairman Sensenbrenner. The chair has already ruled that 
the question is divisible----
    Ms. Lofgren. Right.
    Chairman Sensenbrenner. Because any member may demand a 
division of the question if there are two separate and distinct 
propositions. And in your amendment, there are two separate and 
distinct propositions. One is to strike the statutory damage 
and remedy and the other is to include recipients of e-mail as 
parties who have standing to bring actions in the court.
    Mr. Watt. Mr. Chairman, may I reclaim my time just briefly?
    Mr. Frank. Parliamentary inquiry.
    Chairman Sensenbrenner. The gentleman has got the time, and 
you cannot take a gentleman from the floor with a parliamentary 
inquiry. The gentleman from North Carolina may proceed.
    Mr. Frank. Will the gentleman yield for a parliamentary 
inquiry?
    Mr. Watt. I'll yield to the gentleman.
    Mr. Frank. I wonder whether it might resolve this situation 
if, by unanimous consent, we retain the division, but vote it 
in reverse order on the two propositions, so that the second 
proposition was voted on first.
    Chairman Sensenbrenner. Without objection, proposition two 
will be voted on----
    Ms. Lofgren. I object.
    Chairman Sensenbrenner. Objection is heard, and the 
gentleman from North Carolina----
    Mr. Watt. Mr. Chairman, let me reclaim my time.
    Chairman Sensenbrenner. You have some time left.
    Mr. Watt. First of all, they say the definition of a good 
compromise is one that is uncomfortable for both sides, and 
maybe Ms. Lofgren has gotten us to a point where we are 
uncomfortable with both sides. So maybe we ought to vote this 
up or down.
    I think the private cause of action is worth having in the 
bill, even though--even subject to striking out the statutory 
damages. So I want to ask unanimous consent to withdraw my 
request for a division of the question.
    Chairman Sensenbrenner. Without objection, so ordered.
    Does anyone else demand a division of the question?
    Going once, going twice.
    [Laughter.]
    Chairman Sensenbrenner. If not, the question is on the 
adoption of the Lofgren amendment, in total, to the Goodlatte 
amendment.
    Those in favor will say aye.
    Opposed, no.
    The nos appear to have it.
    Ms. Lofgren. Mr. Chairman, I'd ask a recall vote.
    Chairman Sensenbrenner. The rollcall will be ordered. The 
question is shall the amendment offered by the gentlewoman from 
California, Ms. Lofgren, to the amendment offered by the 
gentleman from Virginia, Mr. Goodlatte, be adopted?
    Those in favor will signify, as your names are called, by 
saying aye; those opposed, no. And the clerk will call the 
roll.
    The Clerk. Mr. Hyde?
    [No response.]
    The Clerk. Mr. Gekas?
    Mr. Gekas. No.
    The Clerk. Mr. Gekas, no. Mr. Coble?
    Mr. Coble. No.
    The Clerk. Mr. Coble, no. Mr. Smith?
    Mr. Smith. No.
    The Clerk. Mr. Smith, no. Mr. Gallegly?
    [No response.]
    The Clerk. Mr. Goodlatte?
    Mr. Goodlatte. No.
    The Clerk. Mr. Goodlatte, no. Mr. Chabot?
    Mr. Chabot. No.
    The Clerk. Mr. Chabot, no. Mr. Barr?
    Mr. Barr. No.
    The Clerk. Mr. Barr, no. Mr. Jenkins?
    Mr. Jenkins. No.
    The Clerk. Mr. Jenkins, no. Mr. Hutchinson?
    Mr. Hutchinson. No.
    The Clerk. Mr. Hutchinson, no. Mr. Cannon?
    Mr. Cannon. Aye.
    The Clerk. Mr. Cannon, aye. Mr. Graham?
    [No response.]
    The Clerk. Mr. Bachus?
    Mr. Bachus. No.
    The Clerk. Mr. Bachus, no. Mr. Scarborough?
    [No response.]
    The Clerk. Mr. Hostettler?
    Mr. Hostettler. No.
    The Clerk. Mr. Hostettler, no. Mr. Green?
    Mr. Green. No.
    The Clerk. Mr. Green, no. Mr. Keller?
    Mr. Keller. No.
    The Clerk. Mr. Keller, no. Mr. Issa?
    [No response.]
    The Clerk. Ms. Hart?
    Ms. Hart. No.
    The Clerk. Ms. Hart, no. Mr. Flake?
    Mr. Flake. No.
    The Clerk. Mr. Flake, no. Mr. Conyers?
    Mr. Conyers. Aye.
    The Clerk. Mr. Conyers, aye. Mr. Frank?
    Mr. Frank. Aye.
    The Clerk. Mr. Frank, aye. Mr. Berman?
    Mr. Berman. Aye.
    The Clerk. Mr. Berman, aye. Mr. Boucher?
    [No response.]
    The Clerk. Mr. Nadler?
    Mr. Nadler. Aye.
    The Clerk. Mr. Nadler, aye. Mr. Scott?
    [No response.]
    The Clerk. Mr. Watt?
    Mr. Watt. Aye.
    The Clerk. Mr. Watt, aye. Ms. Lofgren?
    Ms. Lofgren. Aye.
    The Clerk. Ms. Lofgren, aye. Ms. Jackson Lee?
    Ms. Jackson Lee. Aye.
    The Clerk. Ms. Jackson Lee, aye. Ms. Waters?
    Ms. Waters. Aye.
    The Clerk. Ms. Waters, aye. Mr. Meehan?
    [No response.]
    The Clerk. Mr. Delahunt?
    [No response.]
    The Clerk. Mr. Wexler?
    [No response.]
    The Clerk. Ms. Baldwin?
    Ms. Baldwin. Aye.
    The Clerk. Ms. Baldwin, aye. Mr. Weiner?
    Mr. Weiner. Aye.
    The Clerk. Mr. Weiner, aye. Mr. Schiff?
    Mr. Schiff. Aye.
    The Clerk. Mr. Schiff, aye. Mr. Chairman?
    Chairman Sensenbrenner. No.
    The Clerk. Mr. Chairman, no.
    Chairman Sensenbrenner. Are there additional members in the 
room who desire to cast their vote or change their vote?
    The gentleman from California?
    Mr. Gallegly. No.
    The Clerk. Mr. Gallegly, no.
    Chairman Sensenbrenner. Anybody else who wishes to cast or 
change their vote?
    [No response.]
    Chairman Sensenbrenner. If not, the clerk will report.
    The Clerk. Mr. Chairman, there are 12 ayes and 16 nays.
    Chairman Sensenbrenner. And the amendment is not agreed to.
    The question now is on the adoption of the Goodlatte 
amendment to the amendment in the nature of a substitute.
    Those in favor will say aye.
    Opposed, no.
    The ayes appear to have it. The ayes have it, and the 
Goodlatte amendment is adopted.
    Are there further amendments? The gentlewoman from 
Pennsylvania?
    Ms. Hart. Thank you, Mr. Chairman. I have an amendment at 
the desk.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    Ms. Hart. Mr. Chairman, I move that the----
    Chairman Sensenbrenner. Well, let's let the clerk start 
passing the amendment out before members waive their rights.
    Without objection, the amendment is considered as read.
    [The amendment follows:] 
    
    
    Chairman Sensenbrenner. The gentlewoman from Pennsylvania 
is recognized for 5 minutes.
    Ms. Hart. Thank you, Mr. Chairman.
    As I discussed briefly earlier, we did have a concern 
raised at the hearing, as well as having been raised today, 
about pornographic and sexually explicit materials being sent 
via e-mail advertising. I've also heard similar complaints from 
my constituents, both now as a Member of Congress and also as I 
served in the Pennsylvania State Senate. I've also discussed 
with other members here in this body that this is an issue, and 
we ought to address it. I think it's appropriate to address it 
in this bill.
    My amendment is based on the same principles as legislation 
that we passed in Pennsylvania, basically, to label such e-
mails. It is modeled after similar laws, postal laws, that 
require sexually oriented material to be labeled when it runs 
through the regular mail system.
    It accomplishes several things. The amendment requires the 
Attorney General to create an identifying mark in the e-mail, 
to alert individuals to e-mails containing such sexually 
oriented material.
    It also requires any individual sending such e-mail to have 
the proper identification such as has been discussed in Mr. 
Goodlatte's amendment, otherwise that sender would face tough 
penalties.
    We also, in the amendment, define sexually oriented 
material in a manner that has already been found 
constitutional. It's in the current postal law, Title 39. The 
amendment, I believe, Mr. Chairman, is a common-sense solution 
to a serious problem. It is based on, as I mentioned, Title 39, 
where the postmaster may prescribe that identifying marks be 
placed on mail that include sexually oriented material.
    The Supreme Court upheld this law as constitutional in the 
case of Rowan v. United States Postal Department and a decision 
was followed in the case of Pent R. Books v. United States 
Postal Department. These laws have been effective in curbing 
the amount of sexually oriented material. I think these laws 
have been on the books for about 30 years. Basically, they cite 
the right of the receiver of mail not to be forced to receive 
sexually oriented advertising, sexually oriented materials 
unsolicited.
    I believe these principles can be effective in giving 
families control over the type of information that is sent to 
their e-mail accounts, the same way now they currently have 
control over what's sent to their mail boxes. Individuals can 
be alerted before opening these e-mails containing sexually 
oriented material, as was referred to by the gentleman from 
Massachusetts, but also I think it's important that they can 
also use currently available filtering software to eliminate 
these ads so that their children can be protected.
    Currently, these programs are available and can prevent 
families from accessing pornographic sites, but e-mail 
advertisements containing pornographic material are often 
missed by that type of filtering software.
    I would encourage my colleagues to support the amendment.
    Ms. Lofgren. Would the gentlelady yield for a question?
    Ms. Hart. Yes, Mr. Chairman.
    Ms. Lofgren. I am very interested in doing something in 
this area, and in fact have talked to several members on the 
other side of the aisle about bringing forward a separate bill 
instead of an amendment.
    The question I have is whether the definition on line 14 on 
the first page has been tested in court. Is that part of 
existing law and is it sufficiently unvague to avoid 
constitutional defects, in terms of court decisions, do you 
know?
    Chairman Sensenbrenner. The answer to her question is it is 
taken right out of the Postal Statute, which is 39 US Code 
3010.
    Ms. Lofgren. Thank you very much then. I am happy then to 
support this amendment, noting that, unfortunately, Mr. Frank 
is correct, 16-year-old boys all over the country will be 
looking for the marks, but there is an opportunity at least to 
alert people, and I yield back.
    Mr. Weiner. Will the gentlelady yield? Will the gentlelady 
yield?
    Ms. Lofgren. The time is to Congresswoman Hart.
    Ms. Hart. I will yield.
    Mr. Weiner. Does the Attorney General or the Justice 
Department have a position on your amendment?
    Ms. Hart. No. We have actually shared this with the 
Attorney General, but we have not--I actually am not married to 
the idea of the Attorney General actually handling this, 
although I think it's the best idea, it's the most direct.
    Mr. Weiner. Is there any--is there any reason why this 
couldn't be done under state law?
    Ms. Hart. Pardon me?
    Mr. Weiner. Is there any reason why it couldn't be done 
under state law? Is there a problem inherent in the Internet 
that makes that a difficult thing to do?
    Ms. Hart. Well, we actually--it's a problem, obviously, 
with enforcement if you handle it another way. You're just 
going to have it so limited and so difficult, and spotty 
enforcement. We'd actually passed a state law in Pennsylvania 
that contained basically the same language, but, however, 
obviously, it doesn't cover enough----
    Ms. Lofgren. Mr. Chairman, could you give the gentlelady an 
additional 1 minute?
    Ms. Hart. I need to respond, first of all, to Ms. Lofgren--
--
    Chairman Sensenbrenner. Does the gentlelady want an 
additional 2 minutes or not?
    Ms. Hart. Please. Yeah, Ms. Lofgren suggested that----
    Chairman Sensenbrenner. Does the gentlelady want an 
additional 2 minutes because her time is expired?
    Ms. Hart. Yes, Mr. Chairman, thank you.
    Chairman Sensenbrenner. Without objection, the gentlelady 
is recognized for two additional minutes.
    Ms. Hart. A comment was made regarding labeling that would 
direct people to open such e-mails, but again, if there's a 
minor living in the parents' home, those parents should have 
control over their Internet, and would be able to use filtering 
software to filter out such advertising, because of the label. 
So they'd know to expect the label and be able to filter out 
that advertising----
    Ms. Lofgren. Would the gentlelady yield? In an ideal world, 
I would love to believe that's true, but as the mother of a 16-
year-old son, who is a better programmer than I, those ideals 
don't always work out that way.
    But I do believe that this is a step in the right 
direction. Support----
    Ms. Jackson Lee. Would the gentlelady yield?
    Ms. Lofgren. Sure.
    Ms. Jackson Lee. I raised a question earlier, and I 
appreciate the amendment, and wanted to--I'm going to support 
the amendment because I think this whole idea of intrusive e-
mail that can be characterized as pornographic should be 
addressed, even though we want parents to work on it as well.
    I would hope the gentlelady would be open--I'd hope the 
gentlelady would be open--it looks like this amendment may be 
moving toward passage--to considering whether or not the 
Attorney General is the best arbiter or decider of the marks, 
and that we could work together on that. But in any event, 
because I would want it to be done as expeditiously as 
possible, but in any event, I think the idea of curbing this 
electronic mail is a very good one, and I yield back.
    Chairman Sensenbrenner. The time of the gentlewoman is once 
again expired. The gentleman from Michigan, Mr. Conyers.
    Mr. Conyers. Mr. Chairman, with two boys not yet 16, I come 
to this with a great deal of interest.
    Chairman Sensenbrenner. And the gentleman is recognized for 
5 minutes to express his interest.
    Mr. Conyers. At least 5 minutes. Okay. There's probably no 
more complicated or difficult area in law than obscenity, and 
so I congratulate the gentlelady from Pennsylvania, but I want 
to remind her that in 1989 the Supreme Court struck down the 
FCC's dial-a-porn regulations. That Communication Decency Act 
in 1996 to regulate obscenity on the Internet, was struck down, 
again by the Supreme Court. The law successor, the Child Online 
Protection Act from two congresses ago, is currently being 
challenged in the Court as we speak. At the very least, we need 
to examine this, work on it together, probably have hearings. I 
want to do this thing with--I'm very anxious to do this, and 
I'm sympathetic to the good purposes behind it, and maybe if we 
just want to make everybody know that we're all good guys 
working on this, we can do it anyway.
    But this amendment is probably--more than probably at this 
reading, likely to violate the First Amendment. And I'd be 
happy to work on this. Since this is commercial speech, the 
operative standard in the court is the Central Hudson test, 
saying that there must be a substantial government interest 
directly advanced by reasonable means in order to regulate 
obscenity.
    Now, there is----
    Ms. Hart. Gentleman yield?
    Mr. Conyers. There is less obtrusive technology which could 
respond to the problem. For example, an entire software 
industry built on filters, so that people can screen obscene 
materials. Are we sure that these filters cannot mitigate the 
problem before us? In addition, it's unclear what good the 
marking requirement would accomplish since such marks, as 
already been indicated, actually encourage opening this kind of 
e-mail.
    So the--so this proposal finally applies to unsolicited as 
well as solicited e-mails. What does that carry with it? It 
means that even person who want to receive these advertisements 
will be subject to the requirements, and I think that the 
Supreme Court, in its presently constituted----
    Ms. Hart. Will the gentleman yield?
    Mr. Conyers.--would find that this would be an unnecessary 
burden. I yield to the gentlelady from Pennsylvania.
    Ms. Hart. Thank you. First, to answer your question about 
the Communications Decency Act, what they did state--what the 
Court stated is that the burden was too broad, and if it could 
be made less restrictive, which I believe this amendment does, 
then I believe it would withstand a challenge. And also--that's 
all. I yield back.
    Ms. Lofgren. Would the gentleman yield?
    Mr. Conyers. That's not sufficient, and I don't think it 
would be sufficient. So we've got a huge problem here, folks, 
and I'd like to encourage all of us to come together around 
this and craft something that we can all agree on, rather than 
toss it up at this hour, a few minutes before we're going to 
break.
    Mr. Watt. Would the----
    Mr. Conyers. I yield to the gentleman from North Carolina.
    Mr. Watt. I thank the gentleman for yielding. Wouldn't one 
of the ways to establish and document the Government interest 
be to have the hearings that you're talking about----
    Mr. Conyers. Exactly.
    Mr. Watt. And to build a congressional record in support of 
that, which this amendment currently lacks.
    Mr. Conyers. Yield to Ms. Lofgren.
    Ms. Lofgren. Thank you. That's why--I had actually talked 
to several members on the other side of the aisle about 
proceeding separately. I think it's important that whatever we 
do be upheld by the courts. I don't--I greatly respect the 
ranking member. I do think that the labeling is quite different 
than the prohibition, and I think that--I am willing to support 
this amendment today, but I do think it's important that we 
state that our motivation is to protect minors, that the 
definition that is encompassed in this amendment is really to 
allow for the protection of minors, it's not just about 
obscenity, and then also to provide for notice, because there 
are individuals--I mean if you get an e-mail, you click it, and 
there may be some stuff that you just don't want to see, and it 
should be up to the----
    Chairman Sensenbrenner. The gentlewoman's time has expired.
    Ms. Lofgren. I would ask that the----
    Mr. Conyers. I ask for 1 minute.
    Chairman Sensenbrenner. The gentleman from Michigan.
    Mr. Conyers. Could I yield 5 seconds to Mr. Frank for a 
quiip?
    Mr. Frank. I just want to say that if we're going to have 
those hearings, I hope we will advertise them appropriately, 
because I wouldn't want people to wander in and be offended by 
the material that would be at the hearings. The Attorney 
General's----
    Chairman Sensenbrenner. The staff is directed to put a 
sign--or to make a sign to put on the door, ``offensive 
material inside.''
    Mr. Frank. ``May be heard.'' And no waiting--you've got to 
wait in line personally. No hiring someone to get in.
    [Laughter.]
    Chairman Sensenbrenner. Now, that is a restriction on 
commerce that I don't think we ought to get in.
    Mr. Conyers. I yield to the gentlelady from----
    Chairman Sensenbrenner. Let me poll the----
    Ms. Hart. I thank the gentleman for yielding.
    Chairman Sensenbrenner. Excuse me. Excuse me. The time has 
expired.
    Let me poll the committee to see how much longer this is 
going on. How many people more wish to speak on this amendment? 
One, two, three, four----
    Mr. Conyers. Let's hold a hearing.
    Chairman Sensenbrenner. Five. I know of an amendment to be 
offered by the gentleman from Utah, Mr. Cannon. How many other 
amendments are there? You have an amendment, Mr. Schiff?
    Mr. Schiff. Yes, Mr. Chairman, I have three.
    Chairman Sensenbrenner. The gentleman from Michigan has a 
request.
    Mr. Conyers. Could I courteously ask the gentlelady from 
Pennsylvania, viewing how long this could go on, to withdraw 
this amendment and allow us all to consult with you?
    Ms. Hart. In light of the simplicity of the amendment, I 
would prefer not to do that. Again, we've gotten into--if I 
have a moment?
    Chairman Sensenbrenner. Well, if this is the case, the 
committee will be recessed until 2:00 o'clock. I would ask the 
members to come back promptly at 2:00 because the sequential on 
this bill expires on June 5th, which means that we have to 
report the bill out on June 5, so that there is time for 
members to file additional dissenting or minority views.
    The committee is recessed until 2:00 o'clock.
    [Recess]
    Chairman Sensenbrenner. The committee will come to order.
    At the time the committee recessed, pending was an 
amendment to the amendment in the nature of a substitute 
offered by the gentlewoman from Pennsylvania, Ms. Hart.
    All those in favor of the Hart Amendment will signify by 
saying aye.
    Opposed, no.
    Ms. Jackson Lee. What are the ayes about?
    Chairman Sensenbrenner. We're ayeing or noing about the 
Hart Amendment. Those opposed, say no.
    Ms. Jackson Lee. Mr. Chairman----
    Chairman Sensenbrenner. The ayes appear to have it.
    Ms. Jackson Lee. I'm an aye, but a question.
    Chairman Sensenbrenner. Okay. The ayes have it both 
wholeheartedly and questionably, and the amendment is agreed 
to. Are there further amendments?
    Ms. Jackson Lee. Can I make a parliamentary inquiry?
    Chairman Sensenbrenner. The gentlewoman will state her 
inquiry.
    Ms. Jackson Lee. This bill, Mr. Chairman, you--did you 
indicate how fast this bill would move?
    Chairman Sensenbrenner. No, I didn't. Our sequential 
expires on June 5th, which means that we have to report the 
bill out today in order to give the 2 days necessary for the 
filing of additional supplemental minority or dissenting views, 
and have the report filed the day that we get back from recess. 
If we don't file a report today, we end up losing jurisdiction, 
and everything we've done is for naught.
    Ms. Jackson Lee. Thank you, Mr. Chairman. It will give me 
time to work with Ms. Hart in her office on some issues that I 
have. Thank you very much, Mr. Chairman.
    Chairman Sensenbrenner. I have a feeling that there will be 
a negotiation in the Rules Committee because we are somewhat 
going down a different road than the Commerce Committee has.
    The gentleman from California; for what purpose do you seek 
recognition?
    Mr. Schiff. Mr. Chairman, I have three amendments at the 
desk.
    Chairman Sensenbrenner. Which ones do you want?
    Mr. Schiff. Amendments 1, 2 and 3.
    Chairman Sensenbrenner. Do you want to do them en bloc?
    Mr. Schiff. I think I prefer to do them separately. I think 
that at least two of them will be very quick, Mr. Chairman.
    Chairman Sensenbrenner. Which one do you wish to offer 
first?
    Mr. Schiff. Amendment No. 1.
    Chairman Sensenbrenner. Well, I have 18, 19 and 20.
    Mr. Schiff. This is 18, 19 and 22, Mr. Chairman.
    Mr. Goodlatte. Mr. Chairman, I reserve a point of order.
    Chairman Sensenbrenner. Well, you've got to pick one.
    Mr. Schiff. Yes, 18.
    Chairman Sensenbrenner. The clerk will report Schiff No. 
18.
    The Clerk. Amendment to the amendment----
    Mr. Goodlatte. I reserve a point of order, Mr. Chairman.
    Chairman Sensenbrenner. Point of order is reserved.
    The Clerk. Amendment to the Amendment in the Nature of a 
Substitute to H.R. 718, offered by Mr. Schiff.
    At the end of the amendment----
    Mr. Schiff. Mr. Chairman, request waiving the reading.
    The Chairman. Without objection, the amendment is 
considered as read, and the gentleman from California is 
recognized for 5 minutes.
    [The amendment follows:] 
    
    
    Mr. Schiff. Thank you, Mr. Chairman. This amendment very 
simply requires that the Attorney General submit a report to 
Congress providing an analysis of the effectiveness and 
enforcement of the provisions of the act, and make suggestions 
or modifications if necessary.
    In light of the fact that the amendments to the original 
bill reduced the penalties and changed the nature of the bill, 
I think it all the more important to make sure that those 
changes which reduced the penalties for violations, that we 
have some measure of whether it's effective in that form. This 
would simply require the Attorney General to report to 
Congress, and I urge an aye vote.
    Mr. Goodlatte. Mr. Chairman.
    Chairman Sensenbrenner. The gentleman yield back the 
balance of his time?
    Mr. Schiff. I do, Mr. Chairman.
    Chairman Sensenbrenner. For what purpose does the gentleman 
from Virginia seek recognition?
    Mr. Goodlatte. Mr. Chairman, I withdraw my objection, and 
support the amendment.
    Chairman Sensenbrenner. The question is the adoption of 
Schiff Amendment No. 1. Those in favor will signify by saying 
aye.
    Opposed, no.
    The ayes appear to have it. The ayes have it, and the 
amendment is agreed to.
    The gentleman from California?
    Mr. Schiff. Mr. Chairman, on Amendment 019, this amendment 
would simply express----
    Chairman Sensenbrenner. Does the gentleman offer Amendment 
019?
    Mr. Schiff. Yes, Mr. Chairman.
    Chairman Sensenbrenner. Clerk will report the amendment.
    The Clerk. Amendment to the Amendment in the Nature of a 
Substitute to H.R. 718, offered by Mr. Schiff.
    At the end of the amendment, add the following----
    Chairman Sensenbrenner. Without objection, the amendment is 
considered as read, and the gentleman from California is 
recognized for 5 minutes.
    [The amendment follows:] 
    
    
    Mr. Schiff. Mr. Chairman, this amendment simply 
acknowledges that e-mails are international in nature, and any 
action that we take in Congress has to be mindful of the fact 
that people will be sending e-mails solicited and otherwise 
from around the world. And this expresses the sense of 
Congress, that the President should provide for the Federal 
Government to engage and participate in governments around the 
world, to develop internationally accepted and consistent 
standards to address the issue of unsolicited commercial 
electronic mail. I waive the balance of my time and urge an aye 
vote.
    Chairman Sensenbrenner. The gentleman from Virginia?
    Mr. Goodlatte. Mr. Chairman, move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes
    Mr. Goodlatte. Thank you, Mr. Chairman. Mr. Chairman, I 
have some concerns about this amendment, and the reason is that 
it goes beyond the scope of what the Chairman's mark I think 
intended to encompass with regard to the type of unsolicited 
commercial or electronic mail that we're dealing with. This is 
broader than the scope of the narrowly crafted legislation that 
is before the committee in terms of the fact that it covers 
more than just the types of fraudulent and false and misleading 
e-mails that are covered under the legislation, and therefore, 
unless it's narrowed, I would be forced to----
    Chairman Sensenbrenner. Would the gentleman yield?
    Mr. Goodlatte. I would yield.
    Chairman Sensenbrenner. I would like to join in the 
opposition of the gentleman from Virginia. This rejects the 
bipartisan compromise that deals with fraud and criminal 
penalties, and gets this committee down the road of regulation, 
which is something that the bipartisan compromise attempted to 
avoid, so I would urge the rejection of this amendment.
    Ms. Lofgren. Would the gentleman yield?
    Mr. Goodlatte. I yield to the gentlewoman from California.
    Ms. Lofgren. I join in concern over the amendment. I 
appreciate the good motives behind the amendment, because 
indeed, the author is correct, the Internet is an international 
environment, but I think it does get into--at least down the 
road, more of a regulatory approach than I think we're trying 
to get.
    And I would just note also that, unfortunately, in our 
interface with some in the international community, they do not 
have the same spirit of nonregulatory approach to the Internet 
that is common here in the US. So it's not always a wonderful 
experience to try and coordinate with our international 
partners.
    Mr. Goodlatte. Thank you. I yield back.
    Mr. Frank. Mr. Chairman?
    Chairman Sensenbrenner. For what purpose does the gentleman 
from Massachusetts seek recognition?
    Mr. Frank. To strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Frank. Mr. Chairman, I noted your point that this 
violates the bipartisan compromise, and I guess that makes it 
about 100 percent for me. I haven't seen a bipartisan 
compromise this year that I liked. I don't know when the word 
``partisan'' took on negative connotations. I'm going to say 
I'm not the world's most complete historian, but I tried hard 
to think about a functioning democracy in modern times that 
didn't have parties, and parties being necessary to democracy, 
apparently. I don't understand why we're supposed to have them, 
and then ignore them. And the fact that something is 
bipartisan, I used to be neutral about it. Now I'm starting to 
go negative.
    But I want to support the gentleman's amendment, and I--I 
hadn't fully understood this--the context I guess. I find 
myself in this--more on the side of the bipartisan compromise 
in the Commerce Committee than the bipartisan compromise in the 
Judiciary Committee, because I do not think limiting ourselves 
to fraudulently addressed mail is a sufficient answer. As I 
said before, I do think they over reached with the ISP part, 
but I think it's a perfectly reasonable thing.
    And I have to say then, the gentlewoman from California, 
the fact that other nations don't agree with us ought not to be 
the basis on which we refuse to talk to them. I guess if people 
agree with you, you probably don't have to talk to them. You 
have--you know, we have to conclude very few treaties with 
people who agree with us exactly. The whole notion of 
international conversation is to try and bridge gaps. So I 
think this is an important amendment, and I think it--I look 
forward to those negotiations because some of us are going to 
be trying to get something that's between the two bills, and 
for that reason, I support this particular amendment.
    Chairman Sensenbrenner. The question is on the amendment 
offered by the gentleman from California, Mr. Schiff.
    Mr. Schiff. Mr. Chairman----
    Chairman Sensenbrenner. Those in favor will signify by 
saying aye.
    Those opposed no.
    The noes appear to have it. The noes have it, and the 
amendment is not agreed to.
    Are there further amendments?
    Mr. Schiff. Yes, Mr. Chairman.
    Chairman Sensenbrenner. Then we will have to come back 
after the last vote in this series. Please be prompt because we 
need a reporting quorum of 19 members. Otherwise, we're going 
to lose jurisdiction in this bill.
    Mr. Frank. Parliamentary inquiry, Mr. Chairman?
    Chairman Sensenbrenner. The gentleman from Massachusetts.
    Mr. Frank. If we lose jurisdiction, that means the Commerce 
direction is the only one in the field?
    Chairman Sensenbrenner. That's right. Are there further 
amendments? If not----
    Mr. Schiff. Yes, Mr. Chairman, I have one further 
amendment.
    Chairman Sensenbrenner. Well, then the committee will be 
recessed until immediately after the last vote in this series. 
Again, I ask the members to come back promptly so that we have 
a reporting quorum. Otherwise we will lose jurisdiction.
    And the committee stands recessed.
    [Recess.]
    Chairman Sensenbrenner. The committee will come to order. 
When the committee recessed, the bill was open to amendment at 
any point. The gentleman from Utah, Mr. Cannon.
    Mr. Cannon. Mr. Chairman, I have an amendment at the desk.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    The Clerk. Amendment to the Amendment in the Nature of a 
Substitute to H.R. 718 offered by Mr. Cannon and Mr. Berman.
    Page 2, line 19----
    Mr. Cannon. Mr. Chairman, I ask unanimous consent that the 
amendment be considered as read.
    Chairman Sensenbrenner. Without objection. The gentleman is 
recognized for 5 minutes.
    [The amendment follows:] 
    
    
    Mr. Cannon. Thank you, Mr. Chairman. Since the advent of 
the Internet, we have been given an incredible tool for both 
communication and trade, the ability to send electronic mail 
messages to one another. But as with any tool, it can be a boon 
when used properly, or a burden when it is not. The reason 
we're here today is just one of those burdens, unsolicited 
commercial e-mail or spam. By far the number one complaint of 
the vast majority of American Web users is their receipt of 
spam. Clearly, a requirement to have accurate header 
information is necessary so that the sources of unsolicited e-
mail can be identified and consumers are able to have their 
addresses stricken from the spam list.
    However, to ultimately resolve this problem, you must stop 
the spammer from obtaining the e-mail addresses in the first 
place. Many responsible websites pledge never to sell, rent or 
lease their users' e-mail addresses. It seems, however, that 
much spam is derived from harvested e-mail addresses from 
various websites. As in the past year alone, AOL Time Warner, 
e-Bay, Microsoft, Verizon, Register.com, and others have all 
been harvested, much to the detriment of their relationship 
with their users. Because no technology can completely protect 
people against this kind of scavenging, a distinct chill is 
being placed upon e-commerce. The sad fact is that American 
consumers are becoming reluctant to engage in any commerce, 
because they now feel that the Internet is not a safe place to 
do business. They feel that their website cannot protect their 
e-mail address.
    That's why I'm offering an amendment to address this issue. 
But adding a narrow prohibition against this kind of behavior, 
my anti-harvesting amendment will help to eliminate consumer 
frustration and would thus encourage e-commerce. The proposed 
anti-harvesting amendment would create a cause of action for 
website only when a person uses automated means to harvest e-
mails from a third-party website without that website's 
consent, and with the intent to transmit spam to enable others 
to--or to enable others to transmit spam.
    The proposed amendment also includes a statutory damages 
provision of up to $500,000. This type of statutory damages 
provision will assist in making sure that harvesters do not 
consider lower level finds as simply the cost of doing 
business.
    I'll face the efforts of my friend, Bob Goodlatte, the bill 
being considered today, coupled with my anti-harvesting 
amendment, will help eliminate spam. Taken together, this 
package will add up to consumer confidence on the Internet. It 
will also take--it will also be a step closer to the day when 
and individual--an individual's e-mail address will be as 
public or private, as the individual consumer wants it to be. 
Without an anti-harvesting provision, only one-half of the spam 
problem will be addressed. I accordingly offer this amendment 
and urge my colleagues----
    Chairman Sensenbrenner. Will the gentleman yield?
    Mr. Cannon.--to adopt this harvesting language. Yes.
    Chairman Sensenbrenner. I thank the gentleman for yielding, 
and appreciate his concerns, and would endeavor to work with 
him on this and other issues. You should know that many have 
concerns about this amendment because it is argued the 
amendment prejudices the database and privacy debates. Every 
week interested parties meet with the staff from this committee 
and that of the Energy and Commerce Committee to work out 
issues involving the database bill. This amendment may confuse 
that process, and thus, in my opinion, is not appropriate at 
this time, although it would be appropriate at sometime in the 
future.
    Furthermore, the amendment may impact the privacy debate 
because it prohibits the collection of information for 
marketing purposes. The substitute avoids the pitfall of 
regulating electronic commerce, including e-mail marketing.
    I appreciate the gentleman's efforts on this issue, and 
will further review the matter and work with you as this 
legislation makes its way through the legislative process, but 
again, I do not believe that this is the proper time and place 
to offer the amendment.
    Mr. Cannon. If the Chairman will work with us----
    Mr. Berman. Would the gentleman yield?
    Mr. Cannon.--we will be happy to continue working on it, 
and reclaiming my time, I'd like to yield to the gentleman from 
California, Mr. Berman.
    Mr. Berman. Yes. Thank you, Mr. Chairman. I never--the 
argument about it prejudicing the database bill, I never fully 
understood, but the one thing I know is, having gotten some 
reports about that process, it's already confusing.
    But I just--I appreciate the gentleman yielding, and I just 
wanted to agree with him that there should be an effort to deal 
with this at the source, and I support the anti-harvesting 
amendment. There is a belief out there that the robot 
harvesting, about which Mr. Cannon speaks, is covered by the 
Computer Fraud and Abuse Act already, known as Section 1030. 
Under this act, however, the plaintiff must prove that he or 
she has suffered at least 5,000 in damages or that his or her 
computer systems have been harmed.
    It's difficult, however, to calculate the harm done to the 
reputation of the harvested website or to the entire system of 
e-commerce when consumers receive fraudulent e-mail, and they 
unfairly hold the harvested website--the harvested website, and 
by extension, e-commerce as a whole, responsible.
    So I support the amendment because it gets at the root of 
spam. Spammers can't send their unsolicited e-mail messages 
without addresses to send their messages to.
    I appreciate the gentleman yielding, and I yield back.
    Mr. Goodlatte. Would the gentleman yield?
    Mr. Cannon. I ask unanimous consent for an extra 2 minutes, 
Mr. Chairman?
    Chairman Sensenbrenner. Without objection.
    Mr. Cannon. Who asked for time?
    Mr. Goodlatte. I did.
    Mr. Cannon. Oh, certainly, Mr. Goodlatte.
    Mr. Goodlatte. I appreciate the gentleman yielding, and I 
share his concern about the nature of--of this problem. I also 
share the concern addressed by the Chairman, in that this does 
effectively broaden the scope of what we're trying to do, 
because again, this goes beyond the issue of fraudulent, false 
and misleading e-mails covered under the narrow substitute that 
the Chairman has offered, and therefore, if the gentleman would 
withdraw, I certainly also commit to trying to find a way to 
address this problem.
    Mr. Cannon. Great. Thank you. Let me just point out that on 
the recess, I--one of my staffers had an e-mail from--that was 
with a fraudulent header, Diane at abcmxk, something odd like 
that. When you clicked on the--on the button to de-list, you 
got a most vulgar site coming up. In fact, I think it called 
itself filthy, but it was awful. This is a serious problem, and 
with the assurance of the Chairman and the gentleman from 
Virginia, I would withdraw my motion.
    Mr. Berman. We now think better of abc.
    Chairman Sensenbrenner. The amendment is withdrawn. Are 
there further amendments? The gentleman from California.
    Mr. Schiff. Thank you, Mr. Chairman. I'd like to offer 
Amendment 0.22.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    The Clerk. Amendment to the Amendment in the Nature of a 
Substitute to H.R. 718 offered by Mr. Schiff.
    Page 1, line 12----
    Mr. Schiff. Mr. Chairman, request waiving reading of the 
amendment.
    Chairman Sensenbrenner. Without objection, the gentleman is 
recognized for 5 minutes.
    [The amendment follows:] 
    
    
    Mr. Schiff. Thank you, Mr. Chairman. This amendment would 
simply require that in unsolicited commercial e-mail, in the 
subject field, the textual message would include ADV: for 
advertisement. This would allow the consumer who gets a flood 
of e-mails, to look at the list of e-mails and identify, 
without having to go through the laborious process of opening 
each one of them, which are unsolicited e-mails and which are 
not. Then the consumer can make the decision whether to spend 
his or her time opening them or simply deleting them, or employ 
a filtration device that will automatically delete them if the 
consumer doesn't want to get unsolicited e-mails. It is, in 
that respect, I think, infinitely preferable both to compiling 
a list of people who don't want to receive e-mails and forcing 
direct marketers or others to check a list. It's also, I think, 
less cumbersome than a opt-out or an opt-in process. It is, in 
fact, California law already.
    The honorable woman from Pennsylvania introduced an 
amendment which passed--just passed this committee, pertaining 
to sexually explicit materials. California law in fact does 
what that gentlewoman's amendment does, and what this amendment 
does. It requires ADV to appear in advertisements, and ADLT 
when those advertisements are not intended for those under 18. 
This is really designed to address the broader problem of 
unsolicited e-mail, and I think does it in probably the least 
restrictive means possible.
    Unless there's any objection that this exceeds the 
bipartisan scope of what the committee is addressing, it does 
so no more and no less than the gentlewoman's amendment from 
Pennsylvania.
    I think that this offers really a minimal investment or 
requirement on behalf of the marketers. On the other hand, it 
provides a great opportunity for consumers to make decisions 
for themselves about how much unsolicited e-mail they wish to 
read. I would urge your aye vote and reserve the balance of my 
time.
    Chairman Sensenbrenner. The gentleman has to yield back his 
time under the 5-minute rule. The gentleman yield back?
    Mr. Schiff. Yes, Mr. Chairman.
    Chairman Sensenbrenner. The chair recognizes himself for 5 
minutes in opposition to the amendment.
    This amendment regulates e-mail marketing. There's no 
question about it. And it disadvantages electronic commerce 
because it has a different standard for the identifying of 
advertising materials on the Internet than if one sent 
advertising through the mail.
    The bipartisan compromise between Mr. Conyers and myself 
decided to have a minimum or nonexistent regulation of the 
Internet, but instead go down the line of having misdemeanor 
penalties for those who violate the purposes of the law. This 
goes back to the scheme of regulation in the Wilson Bill, and I 
believe ought to be rejected.
    I yield back the balance of my time.
    Mr. Goodlatte. Mr. Chairman?
    Chairman Sensenbrenner. The gentleman from Virginia.
    Mr. Goodlatte. Move to strike the last word.
    Chairman Sensenbrenner. The gentleman's recognized for 5 
minutes.
    Mr. Goodlatte. Thank you, Mr. Chairman. I won't use that 
amount of time. I want to join with you in opposition to the 
amendment, which I know is well intentioned by the gentleman 
from California, but I think it raises additional First 
Amendment questions regarding the commercial speech doctrine. 
Commercial speech can indeed by regulated differently than 
other forms of free speech, but there are limitations on what 
can be done in that regard, and I do not believe that the 
requirement of labeling all commercial communications as such 
is within the scope of that doctrine, and therefore, I think 
that's one additional reason not to support this amendment. But 
it also does drastically expand the scope of the legislation 
that this committee is crafting, and therefore, I would oppose 
the amendment.
    Ms. Lofgren. Would the gentleman yield?
    Mr. Goodlatte. I would be happy to yield.
    Ms. Lofgren. I would--I concur with the judgment made by 
yourself and the Chairman, and would note that to the extent 
that there is any burden on the First Amendment by 
Congresswoman Hart's amendment, it is counterbalanced by our 
motivation, which is to prevent minors from being exposed to 
indecent material. There is no such--which is a 
constitutionally permissible goal. There is no such 
countervailing rationale in non-explicit e-mails. And I would 
thank the gentleman for yielding.
    Chairman Sensenbrenner. Does the gentleman yield back?
    Mr. Goodlatte. Yes.
    Chairman Sensenbrenner. The gentleman from Alabama, for 
what purpose do you seek recognition?
    Mr. Bachus. On the amendment.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Bachus. Mr. Chairman, and members of the committee, I 
will tell you that as a user of the Internet, that this 
amendment does have some appeal to me. The amount of 
unsolicited commercial e-mails that I receive has basically 
eliminated my ability to use e-mail at my home in a practical 
manner. And while this may not be the appropriate time, I think 
in the future we have to seriously consider an amendment of 
this type.
    If, as the sponsor has said, that California does this, and 
I think that's what he said, you know, I would wonder how that 
it passes constitutional muster there, but it's 
unconstitutional when offered here. So I will say to the 
sponsor and other members of the committee, at some point if 
those of us we represent who use the Internet continue to be 
frustrated by the large amount of unsolicited commercial e-
mail, I think this approach is something we ought to seriously 
consider.
    And I commend the gentleman for his thought, although I 
will probably not support his amendment at this time, but it is 
to me a very close question.
    Mr. Chairman, I'm not sure that the public interest isn't 
in supporting his amendment.
    Chairman Sensenbrenner. The gentleman yield back? The 
gentleman from Alabama yield back his time?
    Mr. Bachus. Yes.
    Chairman Sensenbrenner. For what purpose does the gentleman 
from New York----
    Mr. Weiner. Move to strike the last word, Mr. Chairman.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Weiner. I just--I mean it's very clear to me that the 
gentleman's amendment is within the narrow confines of this 
bill. The bill talks about regulating commercial electronic--
unsolicited commercial electronic mail by indicating 
information in the header field, by regulating information in 
the heading field that would be material, false or misleading. 
All the gentleman is doing is adding a piece of information to 
the header field, clearly within the scope of this bill, 
indicating what type of content is therein, and thereby 
protecting anyone from saying it's misleading. If they put in 
ADV, then they are--that's a disclosure that ultimately may 
protect businesses from being sued in this--what has turned 
into the ISP enrichment act.
    I think it's also--it's also worth noting that the 
gentleman's argument seems consistent to me. If we're going to 
put PRN in the Re line, why not say ADV? I think we're really 
doing nothing all that different, and I would remind my 
colleagues why we're here. We're here because our constituents 
are getting spam advertisements on their laptop and on their 
desktop, and if you're going to put--if you're going to put a 
chill on that, perhaps the best thing to do is just make is 
possible for people to exercise what the gentlewoman from 
California has espoused--and I kind of agree with--is the 
delete button. And a surefire way to know if you have an 
advertisement is if you put advertisement. And, frankly, we 
have these kinds of disclosures elsewhere in the law.
    I yield the balance of my time to Mr. Schiff.
    Mr. Schiff. Mr. Chairman, very briefly on the 
constitutional point, in fact, I think this amendment has much 
greater chance of surviving constitutional tests than the 
amendment already approved by the committee, because this 
amendment doesn't call for a decision to be made about whether 
something meets the test of the explicit nature of the prior 
amendment. In fact, any amendment--or any transmission that is 
an unsolicited commercial e-mail would be required to carry 
this, and the breadth of it actually strengthens it from a 
constitutional point of view, rather than having to decide 
between different types of speech, what is salacious and what 
is not.
    This is why I think the California law is constitutional, 
but the California law is, I think, going to be ineffective 
because it really only pertains to e-mails that are generated 
from within the State. If this is to be effective, it really 
needs to be done nationally.
    And just as the objection was made on this side of the 
committee to the gentlewoman's amendment, that this wasn't the 
right time and the right place, with all due respect, I think 
it is equally the right time and the right place, as it was for 
the prior amendment.
    Ms. Lofgren. Would the gentleman yield?
    Mr. Schiff. Yes.
    Ms. Lofgren. One of the additional questions I have about 
the amendment is, although we've talked about commercial 
electronic messages, we don't really define what that is, and 
how will this relate to political speech that is not initiated 
by candidates, and what is the constitutionality of that?
    For example, Buzz Flash, which is arguably commercial. 
They're trying to make money. It is political speech. It is not 
candidate generated. It does engage in unsolicited, you know, 
communication, and would have to be burdened in this way, and 
I'm not sure constitutionally how we can do that.
    Mr. Schiff. It would apply to political speech the same 
degree, no more, no less than the bill does already in applying 
terms like materially false or misleading. This will apply and 
will be subject to the same criticism.
    Mr. Weiner. Would the gentleman allow me to reclaim my--
under the definition of the bill, political speech is not 
covered by commercial electronic mail message, because it is 
not to advertise or promote for a commercial purpose or product 
or service.
    Ms. Lofgren. Well, I think it is very gray. I mean, if you 
take a look for--I don't want to pick on Buzz Flash, because 
it's one of my favorite little areas, but I don't think it's--I 
don't think it's clear, and I thank the gentleman for yielding 
to make that point.
    Mr. Schiff. Thank you. Just to reclaim the final balance of 
the time. If we're serious about doing something about this 
problem, there aren't a lot of great options. A cause of 
action, I think, is a very minimal--minimally effective way to 
address the problem. Giving consumers the cause of action is 
even more minimalist. This gives real relief to a very real 
problem, and it does so in a way that poses the least possible 
restriction on commercial unsolicited e-mails in the sense that 
all they need to do is put the ADV in the header, and it's so 
less cumbersome than an opt-in or opt-out. It really has a lot 
to be said for it, and I would urge your aye vote.
    Chairman Sensenbrenner. The time of the gentleman has 
expired. The question is on the Amendment No. 20 by the 
gentleman from California to the Amendment in the Nature of a 
Substitute.
    Those in favor will signify by saying aye.
    Opposed, no.
    The noes appear to have it. The noes have it.
    Mr. Schiff. Request a rollcall.
    Chairman Sensenbrenner. A rollcall is requested. Those in 
favor of the Schiff Amendment will, as your names are called, 
answer aye. Those opposed, no. And the clerk will call the 
roll.
    The Clerk. Mr. Hyde?
    [No response.]
    The Clerk. Mr. Gekas?
    [No response.]
    The Clerk. Mr. Coble?
    [No response.]
    The Clerk. Mr. Smith?
    Mr. Smith. No.
    The Clerk. Mr. Smith, no. Mr. Gallegly?
    Mr. Gallegly. Aye.
    The Clerk. Mr. Gallegly, aye. Mr. Goodlatte?
    Mr. Goodlatte. No.
    The Clerk. Mr. Goodlatte, no. Mr. Chabot?
    Mr. Chabot. No.
    The Clerk. Mr. Chabot, no. Mr. Barr?
    Mr. Barr. No.
    The Clerk. Mr. Barr, no. Mr. Jenkins?
    Mr. Jenkins. No.
    The Clerk. Mr. Jenkins, no. Mr. Hutchinson?
    [No response.]
    The Clerk. Mr. Cannon?
    Mr. Cannon. No.
    The Clerk. Mr. Cannon, no. Mr. Graham?
    [No response.]
    The Clerk. Mr. Bachus?
    Mr. Bachus. Aye.
    The Clerk. Mr. Bachus, aye. Mr. Scarborough?
    [No response.]
    The Clerk. Mr. Hostettler?
    Mr. Hostettler. No.
    The Clerk. Mr. Hostettler, no. Mr. Green?
    Mr. Green. No.
    The Clerk. Mr. Green, no. Mr. Keller?
    Mr. Keller. No.
    The Clerk. Mr. Keller, no. Mr. Issa?
    [No response.]
    The Clerk. Ms. Hart?
    Ms. Hart. No.
    The Clerk. Ms. Hart, no. Mr. Flake?
    Mr. Flake. No.
    The Clerk. Mr. Flake, no. Mr. Conyers?
    [No response.]
    The Clerk. Mr. Frank?
    [No response.]
    The Clerk. Mr. Berman?
    [No response.]
    The Clerk. Mr. Boucher?
    [No response.]
    The Clerk. Mr. Nadler?
    [No response.]
    The Clerk. Mr. Scott?
    [No response.]
    The Clerk. Mr. Watt?
    Mr. Watt. Aye.
    The Clerk. Mr. Watt, aye. Ms. Lofgren?
    Ms. Lofgren. No.
    The Clerk. Ms. Lofgren, no. Ms. Jackson Lee?
    Ms. Jackson Lee. Pass.
    The Clerk. Ms. Jackson Lee, pass. Ms. Waters?
    Ms. Waters. Aye.
    The Clerk. Ms. Waters, aye. Mr. Meehan?
    [No response.]
    The Clerk. Mr. Delahunt?
    [No response.]
    The Clerk. Mr. Wexler?
    [No response.]
    The Clerk. Ms. Baldwin?
    Ms. Baldwin. Aye.
    The Clerk. Ms. Baldwin, aye. Mr. Weiner?
    Mr. Weiner. Aye.
    The Clerk. Mr. Weiner, aye. Mr. Schiff?
    Mr. Schiff. Aye.
    The Clerk. Mr. Schiff, aye. Mr. Chairman?
    Chairman Sensenbrenner. No.
    The Clerk. Mr. Chairman, no.
    Chairman Sensenbrenner. Are there additional members who 
desire to cast or change their vote? The gentleman from North 
Carolina?
    Mr. Coble. No.
    The Clerk. Mr. Coble, no.
    Chairman Sensenbrenner. The gentlewoman from Texas?
    Ms. Jackson Lee. Aye.
    The Clerk. Ms. Jackson Lee, aye.
    Chairman Sensenbrenner. Other members? Other members? If 
not, the clerk will report.
    The Clerk. Mr. Chairman, there are 8 ayes and 14 nays.
    Chairman Sensenbrenner. And the amendment is not agreed to. 
Are there further amendments?
    Ms. Jackson Lee. Mr. Chairman.
    Chairman Sensenbrenner. The gentlewoman from Texas.
    Ms. Jackson Lee. Yes, Mr. Chairman. I have an amendment at 
the desk.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    The Clerk. Mr. Chairman, Amendment to the Amendment in the 
Nature of a Substitute to H.R. 718 offered by Ms. Jackson Lee.
    Mr. Goodlatte. Mr. Chairman, I reserve a point of order.
    Chairman Sensenbrenner. A point of order is reserved. 
Without objection, the amendment is considered as read, and the 
gentlewoman from Texas is recognized for 5 minutes.
    [The amendment follows:] 
    
    
    Ms. Jackson Lee. Thank you very much, Mr. Chairman.
    As I discussed earlier, we all have a neutral concern and 
interest in pornography. I am going to withdraw this amendment. 
I'd appreciate if the gentleman would withhold his point of 
order. But I wanted to bring to the members' attention language 
that I thought, even though it was in a particular section, was 
somewhat maybe even exclusive, the language ``unnatural and 
natural sexual acts'', and so I have sought to broaden that to 
make it where it refers to sexual acts, which allows for the 
coverage of anything that is untoward with respect to young 
people or anyone else.
    I'm going to pursue this with--as this bill moves through 
the House--and try to ensure that the language keeps within 
certain protected features, but as well covers all aspects 
without having to have someone scratch their head about what is 
defined as ``natural and unnatural.''
    So I would ask my colleagues to consider this. I'm going to 
withdraw the amendment, but I do want to have acknowledged the 
presentation of the amendment, and then I intend to work on 
this as we move this legislation to the floor.
    Chairman Sensenbrenner. The amendment is withdrawn. Are 
there further amendments? If not, the question is on the 
Amendment in the Nature of a Substitute as Amended.
    All those in favor will say aye.
    Opposed, no.
    The ayes appear to have it. The ayes have it, and the 
Amendment in the Nature of a Substitute is agreed to.
    The question now occurs on the motion to report to bill 
H.R. 718 favorably as amended by the Amendment in the Nature of 
a Substitute as Amended.
    All in favor, say aye.
    Opposed, no.
    The ayes have it, and the motion to report favorably is 
adopted.
    Without objection, the Chairman is authorized to move to go 
to conference pursuant to House rules. Without objection, the 
staff is directed to make any technical and conforming changes, 
and all members will be given 2 days, as provided by House 
rules, in which to submit additional dissenting supplemental or 
minority views.
    This concludes the business before the committee today. Let 
me thank the members for their patience in coming back this 
afternoon. We have fulfilled our mandate under the sequential 
referral. We will have other opportunities to do that in bills 
that we get from the Commerce Committee. I appreciate the 
indulgence of members, and let me say this isn't the last time 
we're going to fix up the Commerce Committee's work.
    The committee is adjourned.
    [Whereupon, at 4:13 p.m., the committee was adjourned.]
                            Additional Views

    I strongly support the Sensenbrenner-Conyers substitute 
amendment to H.R. 718; however, I am writing additional views 
to indicate my concern that the Hart amendment would violate 
the First Amendment. The Hart amendment requires the Attorney 
General to prescribe marks or labels for e-mails containing 
``sexually-oriented advertisements'' that senders of such e-
mails must then include in all such transmissions.\1\ The 
penalty for violations of the amendment's provisions includes a 
fine, imprisonment for not more than 1 year, or both.\2\
---------------------------------------------------------------------------
    \1\ H.R. 718, Sec. 2 (proposing 18 U.S.C. Sec. 622(a)). The 
amendment defines a ``sexually-oriented advertisement'' as ``any 
advertisement that depicts, in actual or simulated form, or explicitly 
describes, in a predominantly sexual context, human genitalia, any act 
of natural or unnatural sexual intercourse, any act of sadism or 
masochism, or any other erotic subject directly related to the 
foregoing, but material otherwise within the definition of this 
subsection shall be deemed not to constitute a sexually oriented 
advertisement if it constitutes only a small and insignificant part of 
the whole, the remainder of which is not primarily devoted to sexual 
matters.''
    \2\ Id. Pursuant to 18 U.S.C. Sec. 3559, any violation of the Hart 
amendment would be classified as a Class A misdemeanor. The fine 
amounts for all offenses are specified in 18 U.S.C. Sec. 3571. If the 
offender is an individual, the maximum fine is either $250,000 (if 
death results) or $100,000 (if death does not result). If the offender 
is an organization, the maximum fine is either $500,000 (if death 
results) or $200,000 (if death does not result).
---------------------------------------------------------------------------
    I agree with the general objective of the amendment--
keeping sexually-oriented materials away from those who do not 
want them and minors who should not have them--but do not 
believe the amendment has been written with the necessary care 
to pass constitutional scrutiny. I would remind the Members 
that there are few more complicated or difficult area of the 
law than Federal regulations and restrictions of speech. This 
is evidenced by the Supreme Court's 1989 decision to strike 
down the Federal Communication Commission's dial-a-porn 
regulations,\3\ and its 1997 decision to invalidate portions of 
the Communications Decency Act (``CDA''), which regulated 
pornography on the Internet.\4\
---------------------------------------------------------------------------
    \3\ Sable Comm'ns of California v. FCC, 492 U.S. 115 (1989).
    \4\ Reno v. ACLU, 521 U.S. 844 (1997) (striking down portions of 
the Communications Decency Act of 1996, Pub. L. No. 104-104, title V, 
110 Stat. 56 (1996)). The CDA's successor, the Child Online Protection 
Act, also is being reviewed in the Supreme Court. ACLU v. Reno, 217 
F.3d 162 (3d Cir. 2000) (affirming trial court issuance of preliminary 
injunction against enforcement of Child Online Protection Act of 1998, 
Pub. L. No. 105-277, 112 Stat. 2681 (1998), a statute intended to 
protect minors from harmful material on the Internet), cert. granted 
and rev'd sub nom. Ashcroft v. ACLU, No. 00-1293 (2001).
---------------------------------------------------------------------------
  Another recent law, the Children's Internet Protection Act of 2000, 
is also now the subject of First Amendment challenges. Multnomah County 
Public Library v. United States, No. 01-CV-1322 (E.D. Pa. filed Mar. 
20, 2001); American Library Ass'n v. United States, No. 01-CV-1303 
(E.D. Pa. filed Mar. 20, 2001). That law directs that schools or 
libraries receiving Federal funds to obtain computers for Internet 
access must utilize technological filters to block access by minors to 
materials on the Internet having sexual content. Children's Internet 
Protection Act of 2000, Pub. L. No. 106-554 (2000).
  The Supreme Court also has struck down a Federal statute regulating 
the advertising of contraceptives on the grounds that it violated the 
First Amendment. See Bolger v. Youngs Drug Prods. Corp., 463 U.S. 60 
(1983).
    This line of cases should serve as a signal that, if we are 
to legislate on this matter, we must do so in a deliberative 
manner that respects constitutional freedoms. Unfortunately, I 
do not believe the Hart amendment will withstand First 
Amendment scrutiny because it contains overbroad restrictions 
on commercial speech, and may well be found to be void for 
vagueness and to compel speech.

 I. The Amendment Proposes an Overbroad Regulation of Commercial Speech

    It is entirely clear that the protections of the First 
Amendment extend to speech on the Internet,\5\ which the Hart 
amendment proposes to regulate. It is also entirely clear that 
the First Amendment applies to advertisements or commercial 
speech, such as the e-mails covered by the Hart amendment.\6\ 
In this regard, the Court has stated that the constitutional 
test for any regulation of truthful and non-misleading 
commercial speech is whether the law (1) pertains to a 
substantial government interest and (2) is reasonably and 
narrowly tailored to that interest.\7\ In this case, it is not 
clear that the government has a substantial interest in marking 
sexually-oriented ads, nor is the proposal narrowly tailored to 
any such alleged interest.
---------------------------------------------------------------------------
    \5\ Reno, 521 U.S. at 844.
    \6\ The Supreme Court has ruled that ``speech is not stripped of 
First Amendment protection merely because it appears'' as a commercial 
advertisement. Bigelow v. Virginia, 421 U.S. 808, 818 (1975). The Court 
later affirmed that speech that ``does no more than propose a 
commercial transaction'' is protected by the First Amendment. Virginia 
State Bd. of Pharmacy v. Virginia Citizens Consumer Council, 425 U.S. 
748 (1976).
    \7\ 44 Liquormart v. Rhode Island, 517 U.S. 484 (1996); Central 
Hudson Gas v. Public Service Comm'n, 447 U.S. 557 (1980). See also 
Letter from Marvin J. Johnson, Legislative Counsel, ACLU, to the 
Honorable F. James Sensenbrenner, Jr., Chair, House Comm. on the 
Judiciary, & the Honorable John Conyers, Jr., Ranking Member, House 
Comm. on the Judiciary 3 (May 23, 2001) [hereinafter ACLU Letter].
---------------------------------------------------------------------------
    As to the substantial government interest prong, the Hart 
amendment presumes that the government has a substantial 
interest in making consumers and parents aware that they are 
receiving sexually-oriented advertisements via e-mail. There 
is, however, no legislative history or congressional finding to 
support this presumption. The Committee did not hold hearings 
where any mention was made--either by witnesses or Members--of 
a need or desire to mark e-mails containing sexually-oriented 
advertisements. To the contrary, those hearings that Congress 
did hold on e-mail elicited testimony that the primary problem 
for e-mail users was the receipt of bulk, unsolicited 
commercial e-mail, otherwise known as spam.\8\ This is not to 
say that Federal legislation addressing e-mails with sexual 
content is not needed, but merely that the legislative 
groundwork has not been laid for such a law.
---------------------------------------------------------------------------
    \8\ See, e.g., Senate Commerce Comm. Hearing (statement of Jason 
Catlett, President and Founder, Junkbusters Corp.); H.R. Rep. No. 41, 
107th Cong., 1st Sess. 9 (2001).
---------------------------------------------------------------------------
    As to the second prong, the amendment would not appear to 
be sufficiently narrowly tailored to pass constitutional 
scrutiny. For example, the intended beneficiaries of the 
amendment are presumably people who do not want to open e-mails 
with sexually-oriented ads. Unfortunately, even those who have 
asked for such ads would see the mark and possibly be deterred 
from requesting sexually-oriented advertisements.\9\ Proponents 
of the amendment argue that it merely mirrors labeling 
regulations that exist for regular mail, pointing to 39 U.S.C. 
Sec. 3010(a) and its implementing regulations, which require 
distributors of postal mail with sexually-oriented 
advertisements in them to print ``Sexually-Oriented Ad'' on a 
sealed inner envelope that goes in a regular mailer to 
recipients.\10\ Those regulations, however, applied only to 
solicitors sending sexually-oriented ads to people who had 
requested them; the regulations did not apply to unsolicited 
ads.\11\ Under the Hart amendment, the marks and labels must be 
applied to all e-mails, regardless of whether they were 
solicited or unsolicited.
---------------------------------------------------------------------------
    \9\ It has been recognized that restrictions imposed for the 
benefit of people not wanting solicitations are reviewed differently 
when they impact people who do want them. Pent-R-Books v. United States 
Postal Service, 328 F. Supp. 297 (1971), aff'd in part and rev'd in 
part, 538 F. 2d 519 (1976), and cert denied, 430 U.S. 906 (1977) 
(upholding postal regulation on applying marks to postal mail with 
sexually-oriented ads in them because marks were applied to mailings 
only for people who had not requested the materials).
    \10\ See Markup of H.R. 718, House Comm. on the Judiciary, 107th 
Cong., 1st Sess. (May 23, 2001) [hereinafter H.R. 718 Markup]. Portions 
of 39 U.S.C. Sec. 3010 were reviewed and upheld in 1971. Pent-R-Books, 
328 F. Supp. at 297.
    \11\ Pent-R-Books, 328 F. Supp. at 313-14.
---------------------------------------------------------------------------
    In addition, it is not at all clear that technology, which 
is much less obtrusive than Federal legislation, could not be 
used to respond to the problem. For example, there is an entire 
software industry built on filters so people can screen obscene 
materials, and there are Internet Service Providers that will 
filter out e-mails for their customers.\12\ Considering that 
technology is available and being further refined, the courts 
may well question the need for an intrusive new labeling 
requirement. Furthermore, the restriction may not be reasonably 
related to the government's interest. It is possible that the 
marking requirement would do exactly the opposite of what it is 
intended to do, as such marks actually could encourage children 
to view sexually-oriented ads.
---------------------------------------------------------------------------
    \12\ See John Schwartz, Schools Get Tools to Track Students' Use of 
Internet, N.Y. Times, May 21, 2001, at C6; Steve Woodward, AOL Selects 
RuleSpace to Patrol the Internet, Oregonian, May 3, 2001, at B1.
---------------------------------------------------------------------------

              II. The Amendment May be Void for Vagueness

    The Hart amendment also could be found constitutionally 
void on the grounds that it is vague. The Court has delineated 
a ``strict prohibition of statutes which burden speech in terms 
that are so vague as either to allow including protected speech 
in the prohibition or leaving an individual without clear 
guidance as to the nature of speech for which he can be 
punished.'' \13\ As one of the leading constitutional law 
treatises has observed, ``to the extent that the law is vague 
and relates to fundamental constitutional rights, it might have 
an `in terrorem' effect and deter persons from engaging in 
activities, such as constitutionally-protected speech, that are 
of particular constitutional importance.'' \14\ The American 
Civil Liberties Union has further noted:
---------------------------------------------------------------------------
    \13\ Ronald D. Rotunda & John E. Nowak, 4 Treatise on 
Constitutional Law: Substance and Procedure Sec. 20.9 (2d ed. 1992).
    \14\ Id.

        Laws are supposed to ``give the person of ordinary 
        intelligence a reasonable opportunity to know what is 
        prohibited.'' . . . Failure to clearly define when 
        speech transgresses the regulation or law [as the Hart 
        amendment fails to do] will unconstitutionally force 
        people to conform their speech to ``that which is 
        unquestionably safe.'' \15\
---------------------------------------------------------------------------
    \15\ ACLU Letter at 4 (quoting Grayned v. City of Rockford, 408 
U.S. 104, 108 (1972) & Baggett v. Bullitt, 377 U.S. 360, 372 (1964)).

    In this case, the proposal's definition of ``sexually-
oriented advertisement'' \16\ may well be seen as unnecessarily 
vague, could implicate e-mails that its proponents might not 
intend for labeling, and therefore could chill otherwise lawful 
speech. More specifically, the definition does not specify what 
is meant by ``natural or unnatural sexual intercourse'' or 
``any other erotic subject,'' and could require the labeling of 
an e-mail containing an ad for a book about sexual health or 
even an ad that contains double entendres.\17\ Furthermore, in 
an apparent effort to ensure that e-mails with minimal sexual 
content do not have to be labeled, the definition carves out e-
mails having sexual content that ``constitutes only a small and 
insignificant part of the whole, the remainder of which is not 
primarily devoted to sexual matters.'' \18\ Unfortunately, the 
amendment does not specify what is meant by ``a small and 
insignificant part''--that term could implicate e-mails where 
10 percent of the content is sexually-oriented or even where 2 
percent is so oriented.
---------------------------------------------------------------------------
    \16\ H.R. 718, Sec. 2 (proposing 18 U.S.C. Sec. 622(b)). This 
definition comes from 39 U.S.C. Sec. 3010, which requires the labeling 
of postal materials with sexually-oriented ads in them.
    \17\ See ACLU Letter at 3.
    \18\ See H.R. 718, Sec. 2 (proposing 18 U.S.C. Sec. 622(b)).
---------------------------------------------------------------------------

        III. The Amendment May Unconstitutionally Compel Speech

    It also can be argued that the Hart amendment's labeling 
requirement represents an unconstitutional compulsion of speech 
in violation of the First Amendment. The Supreme Court has held 
that requiring private entities to provide disclosures 
implicates the First Amendment.\19\ The Court has further ruled 
in the commercial context that, when the government requires 
disclosures, ``an advertiser's rights are reasonably protected 
as long as disclosure requirements are reasonably related to 
the State's interest in preventing deception of consumers.'' 
\20\ In this case, the Hart amendment requires disclosures of 
e-mails containing sexually-oriented commercial speech but is 
not intended to ``prevent deception of consumers.'' For that 
reason, the requirement could be seen as unconstitutional.
---------------------------------------------------------------------------
    \19\ Riley v. National Fed'n of the Blind, 487 U.S. 781 (1988) 
(striking down a state statute requiring professional fundraisers for 
charities to disclose to potential donors the gross percentage of 
revenues retained in prior charitable solicitations).
    \20\ Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 651, 
652 n.14 (1984).
---------------------------------------------------------------------------
    Proponents of the labeling requirement may argue that other 
forms of media--movies, television shows, and music--are 
labeled for sexual or violent content. There is, however, a 
significant difference between that labeling and what the Hart 
amendment proposes. Current labeling of content is done 
voluntarily by the private industries that distribute the media 
so that potential purchasers (or their parents) will be aware 
of what is being provided. Efforts in Congress to require 
labeling of those media have been previously rejected on the 
grounds they would violate the First Amendment.\21\
---------------------------------------------------------------------------
    \21\ See, e.g., 145 Cong. Rec. H4491-H4499 (daily ed. June 17, 
1999) (debate on Wamp amendment to H.R. 1501, which was defeated 161-
266).
---------------------------------------------------------------------------

                               CONCLUSION

    The protections of the First Amendment should not turn back 
at the doorstep of commercial speech. In fact, it is the 
protection that commercial speech receives that ensures that 
the right to engage in non-commercial speech will be limited in 
only the most extreme circumstances. For that reason, 
limitations on commercial speech must be reasonably and 
narrowly drafted to areas in which the government maintains a 
substantial regulatory interest. Unfortunately, the Hart 
amendment subjects a class of commercial speech to lesser 
constitutional protection than it otherwise deserves and does 
so without the foundation of even a single congressional 
hearing. I urge the Members to reconsider this hastily-drafted 
provision as we move to the floor.

                                   John Conyers, Jr.

                                  
