[House Report 108-536]
[From the U.S. Government Publishing Office]



108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     108-536

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



 
                FRAUDULENT ONLINE IDENTITY SANCTIONS ACT

                                _______
                                

  June 9, 2004.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

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

                              R E P O R T

                        [To accompany H.R. 3754]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on the Judiciary, to whom was referred the bill 
(H.R. 3754) to provide additional civil and criminal remedies 
for domain name fraud, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.

                                CONTENTS

                                                                   Page
The Amendment....................................................     1
Purpose and Summary..............................................     3
Background and Need for the Legislation..........................     3
Hearings.........................................................     4
Committee Consideration..........................................     4
Vote of the Committee............................................     5
Committee Oversight Findings.....................................     5
New Budget Authority and Tax Expenditures........................     5
Congressional Budget Office Cost Estimate........................     5
Performance Goals and Objectives.................................     6
Constitutional Authority Statement...............................     6
Section-by-Section Analysis and Discussion.......................     6
Changes in Existing Law Made by the Bill, as Reported............     7
Markup Transcript................................................     9

                             The Amendment

    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 ``Fraudulent Online Identity Sanctions 
Act''.

SEC. 2. AMENDMENT TO TRADEMARK ACT OF 1946.

    Section 35 of the Act entitled ``An Act to provide for the 
registration and protection of trademarks used in commerce, to carry 
out the provisions of certain international conventions, and for other 
purposes'', approved July 5, 1946 (commonly referred to as the 
``Trademark Act of 1946''; 15 U.S.C. 1117), is amended by adding at the 
end the following new subsection:
    ``(e) In the case of a violation referred to in this section, it 
shall be a rebuttable presumption that the violation is willful for 
purposes of determining relief if the violator, or a person acting in 
concert with the violator, knowingly provided or knowingly caused to be 
provided materially false contact information to a domain name 
registrar, domain name registry, or other domain name registration 
authority in registering, maintaining, or renewing a domain name used 
in connection with the violation. Nothing in this subsection limits 
what may be considered a willful violation under this section.''.

SEC. 3. AMENDMENT TO TITLE 17, UNITED STATES CODE.

    Section 504(c) of title 17, United States Code, is amended by 
adding at the end the following new paragraph:
            ``(3)(A) In a case of infringement, it shall be a 
        rebuttable presumption that the infringement was committed 
        willfully for purposes of determining relief if the violator, 
        or a person acting in concert with the violator, knowingly 
        provided or knowingly caused to be provided materially false 
        contact information to a domain name registrar, domain name 
        registry, or other domain name registration authority in 
        registering, maintaining, or renewing a domain name used in 
        connection with the infringement.
            ``(B) Nothing in this paragraph limits what may be 
        considered willful infringement under this subsection.
            ``(C) For purposes of this paragraph, the term `domain 
        name' has the meaning given that term in section 45 of the Act 
        entitled `An Act to provide for the registration and protection 
        of trademarks used in commerce, to carry out the provisions of 
        certain international conventions, and for other purposes' 
        approved July 5, 1946 (commonly referred to as the `Trademark 
        Act of 1946'; 15 U.S.C. 1127).''.

SEC. 4. AMENDMENT TO TITLE 18, UNITED STATES CODE.

    (a) Sentencing Enhancement.--Section 3559 of title 18, United 
States Code, is amended by adding at the end the following:
    ``(f)(1) If a defendant being prosecuted for a felony offense 
(other than offense of which an element is the false registration of a 
domain name) knowingly falsely registers a domain name and knowingly 
uses that domain name in the course of that offense, the maximum 
imprisonment otherwise provided by law for that offense shall be 
doubled or increased by 7 years, whichever is less.
    ``(2) As used in this section--
            ``(A) the term `falsely registers' means registers in a 
        manner that prevents the effective identification of or contact 
        with the person who registers; and
            ``(B) the term `domain name' has the meaning given that 
        term is section 45 of the Act entitled `An Act to provide for 
        the registration and protection of trademarks used in commerce, 
        to carry out the provisions of certain international 
        conventions, and for other purposes' approved July 5, 1946 
        (commonly referred to as the `Trademark Act of 1946') (15 
        U.S.C. 1127).''.
    (b) United States Sentencing Commission.--
            (1) Directive.--Pursuant to its authority under section 
        994(p) of title 28, United States Code, and in accordance with 
        this section, the United States Sentencing Commission shall 
        review and amend the sentencing guidelines and policy 
        statements to ensure that the applicable guideline range for a 
        defendant convicted of any felony offense carried out online 
        that may be facilitated through the use of a domain name 
        registered with materially false contact information is 
        sufficiently stringent to deter commission of such acts.
            (2) Requirements.--In carrying out this subsection, the 
        Sentencing Commission shall provide sentencing enhancements for 
        anyone convicted of any felony offense furthered through 
        knowingly providing or knowingly causing to be provided 
        materially false contact information to a domain name 
        registrar, domain name registry, or other domain name 
        registration authority in registering, maintaining, or renewing 
        a domain name used in connection with the violation.
            (3) Definition.--For purposes of this subsection, the term 
        ``domain name'' has the meaning given that term in section 45 
        of the Act entitled ``An Act to provide for the registration 
        and protection of trademarks used in commerce, to carry out the 
        provisions of certain international conventions, and for other 
        purposes'', approved July 5, 1946 (commonly referred to as the 
        ``Trademark Act of 1946''; 15 U.S.C. 1127).

                          Purpose and Summary

    H.R. 3754, the ``Fraudulent Online Identity Sanctions 
Act,'' would create penalties for those who submit materially 
false contact information in connection with a domain name used 
to commit a crime or engage in online infringement.

                Background and Need for the Legislation

    Use of the Internet continues to increase significantly. 
Businesses that exist only on the Internet such as Amazon and 
eBay are now an established part of the American economy. The 
vast majority of ``brick and mortar'' businesses have an 
Internet presence to conduct business--not just to advertise 
their existence. Consumers are engaging in Internet commerce in 
growing numbers. Recent studies predict that by the end of 
2004, $144 billion in online sales will occur.
    However, the ease of creating an Internet presence has led 
to a growing number of online fraud cases. Unlike a ``brick and 
mortar'' location that requires some effort to establish, 
including local, state, and Federal registration requirements, 
an online business only requires a computer with Internet 
access. Defrauded consumers cannot easily search distant 
governing body records to research ownership or licensing 
records, if such records exist. Local, state, and Federal law 
enforcement must prioritize the online fraud cases brought to 
their attention due to limited resources, resulting in little 
recourse when most consumers are defrauded online. ``John Doe'' 
civil suits, in which the other party cannot be located, often 
result in uncollectible default judgements.
    In addition to its use by online criminals for traditional 
crimes, materially false contact information is increasingly 
used by those who infringe on the copyrights and trademarks of 
others to hide their identity and avoid civil suits. To 
illustrate, the Committee has reviewed a number of ``sham'' 
submissions that include domain name records featuring random 
strings of characters: locations such as ``nowhere,'' ``none 
such place,'' ``disneyworld,'' and ``the martian embassy;'' as 
well as bogus famous names (U.S. Presidents and cartoon 
characters). The Committee believes that such activity is a 
sign of willful infringement and should deserve, in most cases, 
the additional civil penalties that result from willful 
infringement. The existence of a rebuttable presumption allows 
cases in which a judge determines that such activity does not 
rise to the level of willfulness to be subject to the lower 
non-willful penalties.
    On the Internet, the only contact information for the 
operator of a website is the contact information associated 
with a domain name registration. Longstanding Internet policies 
require domain name registrants to provide such information to 
domain name registrars. Although the Committee is not concerned 
with efforts to disguise the owner of a website when legitimate 
free speech concerns exist (protest websites, whistleblower 
websites, dissident websites, etc.) the Committee maintains 
that consumers should be able to check the ownership of a 
particular domain name. If penalties are not created to 
penalize the provision of materially false contact information 
in connection with a violation of existing law, there will be 
no incentive for domain name registrants to provide accurate 
information in the first place. Via a virtually unknown 
reporting system,\1\ ICANN was made aware of 25,000 reports of 
false contact information in the WHOIS database of domain name 
contact information from September 2002 until February 2004. 
This would indicate that the existence of false contact 
information in the domain name system is actually much higher.
---------------------------------------------------------------------------
    \1\ Community Experiences with the InterNIC Whois Data Problem 
Reports System, ICANN, March 2004.
---------------------------------------------------------------------------
    Congress has held several hearings and enacted legislation 
to address other unique online fraud issues. For example, 
Congress enacted legislation to prohibit ``typo-squatting'' in 
which a domain name is registered that is very similar to 
another popular domain name for the purpose of diverting 
potential customers to another website without the knowledge of 
the owner of the popular site. The Anticybersquatting Consumer 
Protection Act \2\ created new penalties for those who used the 
Internet for fraudulent and criminal activity. The first 
criminal conviction under this Act \3\ was based upon the 
actions of a defendant who used misspellings of popular domain 
names to lure children to pornographic websites. He was 
eventually convicted of 49 counts and sentenced to 30 months in 
prison.
---------------------------------------------------------------------------
    \2\ Pub. L. No. 106-113.
    \3\ United States of America v. John Zuccarini, S.D.N.Y. 2004.
---------------------------------------------------------------------------
    The Internet's current coordinating body, ICANN, continues 
to require the existence of a publicly accessible Whois 
database that contains the registrant-supplied contact 
information of domain name owners. This legislation does not 
reference the Whois database since the Committee intends that 
it will extend beyond Whois database issues and cover all 
contact information supplied by domain name owners to domain 
name registrars, registries, or other authorities. Thus, the 
legislation would still govern even if the Whois system in 
existence on the date of enactment changed, was eliminated in 
the future, or if the recipient of contact information changed 
in the future (perhaps a central contact information tool run 
by ICANN or its successor(s)).
    The Committee believes that the existence of an accurate 
and publicly accessible tool for searching contact information 
associated with a domain name, like the Whois database, is 
essential for the continued growth of the Internet which will 
depend upon Internet users trusting those with whom they 
interact.

                                Hearings

    The Committee's Subcommittee on Courts, the Internet, and 
Intellectual Property held a hearing on H.R. 3754 on February 
4, 2004. Testimony was received from four witnesses 
representing four organizations, with additional material 
submitted by four individuals and organizations.

                        Committee Consideration

    On March 31, 2004, the Subcommittee on Courts, the 
Internet, and Intellectual Property met in open session and 
ordered favorably reported the bill H.R. 3754, as amended, by a 
voice vote, a quorum being present. On May 12, 2004, the 
Committee met in open session and ordered favorably reported 
the bill H.R. 3754 with an amendment by voice vote, a quorum 
being present.

                         Vote of the Committee

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee notes that there 
were no recorded votes during the Committee's consideration of 
H.R. 3754.

                      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.

               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. 3754, 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, May 20, 2004.
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. 3754, the 
``Fraudulent Online Identity Sanctions Act.''
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Lanette J. 
Walker and Melissa E. Zimmerman, who can be reached at 226-
2860.
            Sincerely,
                                       Douglas Holtz-Eakin.

Enclosure

cc:
        Honorable John Conyers, Jr.
        Ranking Member
H.R. 3754--Fraudulent Online Identity Sanctions Act
    H.R. 3754 would increase the maximum prison sentence for 
persons committing crimes using a domain name (Internet 
address) that is registered using false identification. 
According to the United States Sentencing Commission, 
prosecutions for using a domain name in the course of 
committing a crime are rare. The bill also would amend the law 
pertaining to the prosecution of copyright and trademark 
violations. CBO estimates that implementing
    H.R. 3754 would not have a significant effect on spending, 
subject to appropriation, and would not affect direct spending 
or revenues.
    H.R. 3754 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on State, local, or tribal governments.
    The CBO staff contacts for this estimate are Lanette J. 
Walker and Melissa E. Zimmerman, who may be reached at 226-
2860. This estimate was approved by Peter H. Fontaine, Deputy 
Assistant Director for Budget Analysis.

                    Performance Goals and Objectives

    The Committee states that pursuant to clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, H.R. 
3754 is designed to increase the reporting of accurate contact 
information for domain names by penalizing the submission of 
false information. The legislation also creates a rebuttable 
presumption of willfulness for certain copyright and trademark 
infringements.

                   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, clause 8 of the 
Constitution.

               Section-by-Section Analysis and Discussion

    Section 1. Short Title. The Act may be cited as the 
``Fraudulent Online Identity Sanctions Act.''
    Section 2. Amendments to Trademark Act of 1946. This 
section adds a new subsection (e) to 15 U.S.C. Sec. 1117 as 
described below. New subsection (e) creates a rebuttable 
presumption that a trademark violation is willful for purposes 
of determining relief if the violator, or a person acting in 
concert with the violator, knowingly provided or knowingly 
caused to be provided materially false contact information to a 
domain name registrar, domain name registry, or other domain 
name registration authority in registering, maintaining, or 
renewing a domain name used in connection with a violation. 
This provision creates a five-part test to determine whether a 
violation was willful:

        1. LThe domain name registration must be materially 
        false.

        2. LThe information must have been knowingly provided 
        or knowingly caused to be provided.

        3. LThe recipient of the information must be a domain 
        name registrar, registry, or other domain name 
        registration authority (such as ICANN or its 
        successor).

        4. LThe information must be provided for the purpose of 
        registering, maintaining, or renewing a domain name.

        5. LThe domain name must have been used in connection 
        with a violation.

    This five-step test ensures that only those who attempt to 
mask their identity in connection with another violation of the 
Trademark Act will be liable under H.R. 3754. Even if all five 
conditions are present, the accused still has the ability to 
rebut the presumption by offering evidence to the contrary. The 
test also ensures that the mere act of providing materially 
false contact information is not a violation of any law.
    Several groups expressed concern that the Act might be read 
to imply or require that domain name contact information must 
be accurate. Although the Committee believes that all domain 
name contact information should be accurate, this legislation 
does not require it. The Committee notes the availability and 
growing use of anonymous but legitimate domain name 
registrations in which the registrar substitutes their contact 
information instead of the actual registrant. Such services are 
operated under the policies established by ICANN. The Committee 
also notes the ability of any group to establish a free speech 
top level or second level domain in which registrants could 
remain anonymous for legal activities.
    Section 3. Amendment to Title 17, United States Code. 
Subsection 3(a) replicates the language of Section 2, but 
applies it to copyright infringement actions instead. Thus, the 
report language for Section 2 applies to subsection 3(a) in all 
other respects.
    Subsection 3(b) ensures that the paragraph does not limit 
what could be considered willful infringement under this 
subsection. The Committee does not intend to limit the 
situations in which infringement may be considered willful.
    Subsection 3(c) provides for a definition of ``domain 
name'' in Title 17 that currently does not exist. The 
definition used is the existing definition in the Trademark Act 
of 1946.
    Section 4. Amendment to Title 18, United States Code. 
Subsection 4(a) creates a sentencing enhancement that increases 
the maximum imprisonment otherwise provided by law for an 
offense by the lesser of either doubling the existing sentence 
or 7 years. The Committee believes that those who use false 
domain name contact information as part of a crime deserve an 
additional penalty, the length of which will be left to the 
court within the parameters set forth.
    Subsection 4(b) directs the U.S. Sentencing Commission to 
review and amend the sentencing guidelines and policy 
statements to reflect legislative intent as set forth in H.R. 
3754 and this report.

         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 (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

                 SECTION 35 OF THE ACT OF JULY 5, 1946

        (Commonly referred to as the ``Trademark Act of 1946'')

  AN ACT To provide for the registration and protection of trademarks 
used in commerce, to carry out the provisions of certain international 
                  conventions, and for other purposes.

  Sec. 35. (a) * * *

           *       *       *       *       *       *       *

    (e) In the case of a violation referred to in this section, 
it shall be a rebuttable presumption that the violation is 
willful for purposes of determining relief if the violator, or 
a person acting in concert with the violator, knowingly 
provided or knowingly caused to be provided materially false 
contact information to a domain name registrar, domain name 
registry, or other domain name registration authority in 
registering, maintaining, or renewing a domain name used in 
connection with the violation. Nothing in this subsection 
limits what may be considered a willful violation under this 
section.
                              ----------                              


              SECTION 504 OF TITLE 17, UNITED STATES CODE

Sec. 504. Remedies for infringement: Damages and profits

    (a) * * *

           *       *       *       *       *       *       *

    (c) Statutory Damages.--
            (1) * * *

           *       *       *       *       *       *       *

            (3)(A) In a case of infringement, it shall be a 
        rebuttable presumption that the infringement was 
        committed willfully for purposes of determining relief 
        if the violator, or a person acting in concert with the 
        violator, knowingly provided or knowingly caused to be 
        provided materially false contact information to a 
        domain name registrar, domain name registry, or other 
        domain name registration authority in registering, 
        maintaining, or renewing a domain name used in 
        connection with the infringement.
            (B) Nothing in this paragraph limits what may be 
        considered willful infringement under this subsection.
            (C) For purposes of this paragraph, the term 
        ``domain name'' has the meaning given that term in 
        section 45 of the Act entitled ``An Act to provide for 
        the registration and protection of trademarks used in 
        commerce, to carry out the provisions of certain 
        international conventions, and for other purposes'' 
        approved July 5, 1946 (commonly referred to as the 
        ``Trademark Act of 1946''; 15 U.S.C. 1127).

           *       *       *       *       *       *       *

                              ----------                              


              SECTION 3559 OF TITLE 18, UNITED STATES CODE

Sec. 3559. Sentencing classification of offenses

    (a) * * *

           *       *       *       *       *       *       *

    (f)(1) If a defendant being prosecuted for a felony offense 
(other than offense of which an element is the false 
registration of a domain name) knowingly falsely registers a 
domain name and knowingly uses that domain name in the course 
of that offense, the maximum imprisonment otherwise provided by 
law for that offense shall be doubled or increased by 7 years, 
whichever is less.
    (2) As used in this section--
            (A) the term ``falsely registers'' means registers 
        in a manner that prevents the effective identification 
        of or contact with the person who registers; and
            (B) the term ``domain name'' has the meaning given 
        that term is section 45 of the Act entitled ``An Act to 
        provide for the registration and protection of 
        trademarks used in commerce, to carry out the 
        provisions of certain international conventions, and 
        for other purposes'' approved July 5, 1946 (commonly 
        referred to as the ``Trademark Act of 1946'') (15 
        U.S.C. 1127).

                           Markup Transcript



                            BUSINESS MEETING

                        WEDNESDAY, MAY 12, 2004

                  House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:00 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. A 
quorum is present.
    [Intervening business.]
    Chairman Sensenbrenner. The next item on the agenda is H.R. 
3754, the ``Fraudulent Online Identity Sanctions Act.'' The 
Chair recognizes the gentleman from Texas, Mr. Smith, the 
Chairman of the Subcommittee on Courts, the Internet, and 
Intellectual Property.
    Mr. Smith. Thank you, Mr. Chairman.
    The WHOIS database is a compilation of Internet domain 
names such as ``com'' or ``org.'' The database records contain 
pertinent ownership information about domain names including 
the identity of----
    Chairman Sensenbrenner. Can the gentleman make the motion 
and then I'll recognize you for 5 minutes?
    Mr. Smith. The Subcommittee on Courts, the Internet, and 
Intellectual Property reports favorably the bill H.R. 3754 with 
a single amendment in the nature of a substitute, and moves its 
favorable recommendation to the full House.
    Chairman Sensenbrenner. Without objection the bill will be 
considered as read and open for amendment at any point, and the 
Subcommittee amendment in the nature of a substitute, which the 
Members have before them, will be considered as read, 
considered as the original text for purposes of amendment and 
open for amendment at any point. And now the Chair recognizes 
the gentleman from Texas, Mr. Smith, for 5 minutes.
    [The Amendment in the Nature of a Substitute follows:]
      
      



    Mr. Smith. Thank you, Mr. Chairman.
    The WHOIS database is a compilation of Internet domain 
names such as ``com'' or ``org.'' The database records contain 
pertinent ownership information about the domain names 
including the identify of and contact information for the 
domain name's owner.
    Several problems can arise if access to this database is 
unavailable, restricted, limited or if the information is 
incomplete. A consumer might be unable to verify the source of 
a good sold through a website. The FTC would face an additional 
hurdle in tracking down the scam artist. The Department of 
Justice would have a harder time locating spammers, and the 
enforcement of intellectual property rights would be 
frustrated.
    To penalize those who abuse the WHOIS database by 
submitting false information, H.R. 3754 clarifies that willful 
misconduct, the intentional false submission of information to 
a domain name authority, will subject the transgressor to 
additional civil or criminal penalties.
    And I might reassure my colleagues, Mr. Scott and Mr. Watt 
that there are no mandatory minimums in this bill.
    The bill does not impact anonymous free speech since the 
additional penalties it imposes only apply if a crime or 
infringement has already occurred. The bill does not impose any 
additional penalty when someone simply enters false WHOIS 
information for any reason including online activists, 
whistleblowers and others interested in anonymous online 
speech.
    Mr. Chairman, H.R. 3754 has evolved in a bipartisan manner 
and I thank the gentleman from California, Mr. Berman, for his 
help.
    And I will offer a clarifying amendment at the appropriate 
time and urge Members to support both it and the underlying 
bill.
    And I will yield the balance of my time to the Ranking 
Member of the Subcommittee, Mr. Berman.
    Chairman Sensenbrenner. The gentleman from California is 
recognized for 5 minutes.
    Mr. Berman. Thank you very much, Mr. Chairman, for 
scheduling H.R. 3754 for a markup today.
    This is part of a 5-year study by the Committee to improve 
the accuracy and completeness of the WHOIS databases. This 
WHOIS database contains the names, street and e-mail addresses 
and other contact information of domain name registrants. While 
all domain name registrants are required to submit information 
for the WHOIS database, there are no processes to ensure that 
this information is either accurate or complete.
    This bill attempts to improve the accuracy and completeness 
of WHOIS databases by creating some accountability for those 
who, in furtherance of a crime or infringement, only for those 
people, for those who in furtherance of a crime or infringement 
of a copyright or a trademark knowingly provide materially 
false domain name registration information.
    Inaccurate WHOIS data hampers law enforcement 
investigations, facilitates consumer fraud, impairs copyright 
and trademark protection, imperils computer security, enables 
identity theft and weakens privacy protection efforts.
    If this bill accomplishes its goal and results in more 
accurate WHOIS data, it will aid law enforcement in tracking 
down criminals, deter those trademark and copyright infringers 
who provide false information to avoid detection.
    H.R. 3754 advances these goals through narrow amendments to 
current law. It provides that a civil trademark or a copyright 
infringement shall presume to be willful if, in connection with 
the infringement, the infringer registers the domain name with 
materially false contact information. Additionally, the bill 
increases by the lesser of twice the term or 7 years, the 
maximum possible imprisonment for a Federal felony offense when 
the offender knowingly provided materially false domain name 
contact information in connection with the offense.
    While I believe we do have a long road ahead of us in terms 
of ensuring the accuracy of the WHOIS database, I believe we 
have made some meaningful inroads with this legislation and I 
ask my colleagues to support the bill.
    Chairman Sensenbrenner. Gentleman yield back?
    Mr. Berman. Yes.
    Chairman Sensenbrenner. The gentleman yields back the 
balance of his time. Without objection all Members may include 
opening statements in the record at this point.
    Are there amendments?
    Mr. Smith. Mr. Chairman?
    Chairman Sensenbrenner. The Chair recognizes the gentleman 
from Texas, Mr. Smith, for purposes of offering a manager's 
amendment.
    Mr. Smith. 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. 3754 offered by Mr. Smith of Texas.
    After Section 4, insert the following:
    Section 5, Savings Clauses. (a) Nothing in this Act shall 
enlarge or diminish any rights of free speech----
    Mr. Smith. Mr. Chairman, I----
    Chairman Sensenbrenner. Without objection, the amendment is 
considered as read. The gentleman is recognized for 5 minutes.
    Mr. Smith. Mr. Chairman, I think that that is the wrong 
amendment that was read.
    Chairman Sensenbrenner. That is the wrong amendment. 
Without objection, the amendment is withdrawn and the clerk 
will report the right amendment.
    The Clerk. Amendment to the amendment in the nature of a 
substitute to H.R. 3754 offered by Mr. Smith of Texas.
    Page 2, line 4, strike ``Nothing'' and all that follows 
through ``authority'' on line 9.
    Page 3, line 1, strike ``Nothing'' and all that follows 
through the period on line 6.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    [The amendment follows:]
      
      

  


    Mr. Smith. Thank you, Mr. Chairman.
    Mr. Chairman, the reported version of H.R. 3754 contained a 
liability exemption for domain name registrars. This amendment, 
which removes this exemption, is fully supported by domain name 
registrars, including Network Solutions, Bulk Register, 
Register.com, Go Daddy and ENOM. They believe that the wording 
of the original exemption may have implied some liability in 
other situations and so prefer the status quo. I urge the 
Members to adopt this amendment.
    Mr. Chairman, I would like to yield the balance of my time 
to the gentleman from California, Mr. Berman.
    Mr. Berman. Thank you, Mr. Smith, for yielding me the time.
    With some reservations I support the amendment. The 
language that the registrars are asking us to take out is the 
language the registrars asked us to put in. And I liked when 
they asked us to put it in because it demonstrated certain 
situations where they would be accountable for failing to 
improve the accuracy and completeness of the WHOIS database, 
but in the face of their good faith overtures by several of the 
top registrars, Network Solutions, Bulk Registrar, Register, 
Register.com and Go Daddy software, those overtures and 
agreements to cooperate with a GAO study on aspects of the 
WHOIS database, I think we should go along with their wishes, 
and I support the gentleman's amendment.
    I yield back.
    Chairman Sensenbrenner. The question----
    Mr. Nadler. Mr. Chairman?
    Chairman Sensenbrenner. The gentleman from New York, Mr. 
Nadler.
    Mr. Nadler. Yes. Confessing that I may have not been able 
to hear some of what Mr. Smith was saying before because there 
was some----
    Chairman Sensenbrenner. Does the gentleman wish 5 minutes 
to confess? [Laughter.]
    Mr. Nadler. No, just about 30 seconds of my 5 minutes.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Nadler. Thank you.
    The language that was striking says ``Nothing shall impose 
additional penalties on these registrars.'' I don't understand 
why we want to take out that language. Maybe Mr. Smith could 
explain that.
    Mr. Smith. If the gentleman will yield.
    Mr. Nadler. Yes.
    Mr. Smith. We will actually have to ask the domain name 
registrars themselves. I thought that the language wasn't 
problematic myself, but at their request we want to try to 
accede to their wishes.
    And I'll yield to the gentleman from California.
    Mr. Berman. The registrars want to, as most everybody in 
the world does, immunize themselves for any liability in the 
context of the accuracy of the domain names and contact 
information which they register. So they put in language that 
purported to do that except in certain situations. They then 
concluded that they may have now given themselves liability in 
those situations that they didn't immunize themselves from, and 
decided on balance that they were better off if they had never 
asked for any.
    Mr. Nadler. I thank the gentleman, and I yield back.
    Chairman Sensenbrenner. The question is on the amendment 
offered by the gentleman from Texas, Mr. Smith. Those in favor 
will say aye? Opposed, no?
    The ayes appear to have it. The ayes have it. The amendment 
is agreed to.
    Are there further amendments?
    If there are no further amendments, a reporting quorum is 
present. Without objection the Subcommittee amendment in the 
nature of a substitute laid down as the base text as amended is 
adopted.
    The question now occurs on the motion to report the bill, 
H.R. 3754, favorably as amended. Those in favor will say aye? 
Opposed, no?
    The ayes appear to have it. The ayes have it. The motion to 
report favorably is agreed to. Without objection the bill will 
be reported favorably to the House in the form of a single 
amendment in the nature of a substitute, incorporating the 
amendments adopted here today.
    Without objection, the Chairman is authorized to move to go 
to conference pursuant to House rules. Without objection, the 
staff is directed to make an technical and conforming changes, 
and all Members will be given 2 days as provided by the House 
Rules in which to submit additional dissenting supplemental or 
minority views.

                                  
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