File Swappers May Face Civil Suits

WASHINGTON -- Consumer groups jeered and recording and movie industry groups cheered the easy passage in the Senate of proposed legislation that would allow the Department of Justice to bring civil suits against alleged file swappers.

The Protecting Intellectual Rights Against Theft and Expropriation (Pirate) Act of 2004 passed in the Senate by unanimous consent last week. It would allow the DOJ to provide greater legal support to content owners who feel their copyrights have been infringed upon online. Under current laws, the DOJ can only pursue criminal suits against file swappers, which can result in jail time. If approved by the House, the new law would allow the DOJ to bring civil suits, which can result in financial penalties.

Following its passage in the Senate, the legislation was sent to the House Judiciary Committee, where it has yet to be scheduled for a hearing. The hearing may be scheduled when Congress returns after the July 4 holiday, but it is still unclear as to when the Pirate Act will reach the floor of the House for a vote.

Differing Opinions

Already, the proposed legislation is being greeted with mixed reactions.

"The problem here is that major content owners already have an enormous and ever-growing array of legal tools at their disposal to go after file sharers," says Adam Eisgrau, executive director of P2P United, a peer-to-peer trade group in Washington. "This act converts the Department of Justice into a private law firm for Hollywood and the recording industry in the same kind of private suits for damages that these conglomerates previously have been required to bring on their own dime."

But the bill's sponsors say that limiting the DOJ to criminal suits only holds them to a higher burden of proof when attempting to prove copyright infringement.

"This [Pirate bill] would not be a game-changing occurrence," says David Green, vice president and counsel for Technology and New Media at the Motion Picture Association of America. "What the Pirate Act does is give the Department of Justice another arrow in its quiver. The DOJ may wish to file a civil suit in cases that are important, yet do not warrant the heavier sanctions possible in a criminal case."

Green says a criminal conviction in a copyright infringement case might result in up to five years of jail time, whereas conviction in a civil suit can result only in financial penalties.

The Pirate Act "will provide federal prosecutors with the flexibility and discretion to bring copyright infringement cases that best correspond to the nature of the crime," Recording Industry of America Chairman and CEO Mitch Bainwol says in a statement.

The RIAA points to piracy as the main cause of a $2.5 billion decline in record labels' wholesale revenues between 2000 and 2003.

Strong Support

Sponsored by Senator Patrick Leahy (D-Vermont) and cosponsored by Senators Lemar Alexander (R-Tennessee), Orrin Hatch (R-Utah), and Charles Schumer (D-New York), the bill has some powerful backers, and according to some, a good chance of passage in the House.

The Pirate Act would "ensure that more creative works are made available online, that those works are more affordable, and that the people who work to bring them to us are paid for their efforts," Leahy said at the introduction of the bill in March.

The bill also calls on the DOJ to initiate training and pilot programs to teach federal prosecutors across the country how to better impose and enforce copyright law on digital property.

Eisgrau says litigation is not the best means of compensating content owners for material distributed over peer-to-peer networks. His organization suggests an arrangement called "collective licensing," in which content owners would be compensated from a pool of money created from small taxes on such things as blank CDs, DVD burners, or high-speed Internet access.

"That would convert the 60 million Americans who use file sharing software from 'criminals' into 'customers,'" Eisgrau says.

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