House Panel Endorses P2P Criminal Penalties

A congressional subcommittee voted late Wednesday afternoon to criminalize copyright infringement for peer-to-peer users who “knowingly and willfully trade 1,000 or more copyrighted works with other P2P users.” The maximum penalty under the proposed legislation carries a three-year prison sentence.

Known as the Piracy Deterrence and Education Act of 2004, the bill’s criminal provisions also apply to movie bootleggers who copy and sell movies still in release. The bill authorizes $15 million for enforcement as early as next year.

To become law by then, though, the bill faces a steep legislative climb. It must first pass the full House Judiciary Committee and then a face floor vote. If successful in the House, similar legislation must still pass in the Senate.

The bill is aimed at P2P networks such as Kazaa, Grokster and Morpheus, where the music industry places the blame for a continuing slide in CD sales. Since September, the Recording Industry of Association of America (RIAA) has sued for copyright infringement more than 1,500 P2P users, settling cases for several thousand dollars each.

“This is a common sense bill that ensures that federal prosecutors have the tools and expertise to fully enforce the laws on the books,” said RIAA CEO Mitch Bainwol in a prepared statement.

Gigi B. Sohn, president of the public advocacy group Public Knowledge, announced in a statement that there is “much to commend in the bill, including the subcommittee’s willingness to protect fair use rights of consumers to use copyrighted material.”

Sohn said the subcommittee’s action criminalizes what is now lawful use of copyrighted material and, in an election year, whether members of Congress “want to accept the responsibility of having 12-year-olds hauled away in handcuffs by the FBI.”

“We hope the full Judiciary Committee will take a harder look at the change in the standard needed for prosecution of copyright infringement under this bill,” she said.

Sohn added, “It’s one thing for private industry to bring a lawsuit and be ridiculed for suing youngsters and grandmothers. It’s quite another for the Justice Department to make an arrest.”

Since the courts closed the original online file trading service Napster four years ago, Congress has held several high-profile hearings to investigate continued widespread copyright infringement on P2P networks. In the past, lawmakers said they preferred private sector solutions to federal mandates for protecting digital intellectual property, tracking its usage and collecting payments and fees. But a frustrated Congress hasn’t seen any so far.

Part of Wednesday’s bill, sponsored by Reps. Lamar Smith (R-Texas) and Howard Berman (D-Calif.), includes a “Sense of the Congress” provision that notes the refusal of the businesses that operate P2P networks to voluntarily implement a technology filter to block unwanted or unauthorized material and protect consumers. It further calls on Congress and the Bush Administration to take action to prevent illegal uses of these networks.

“The solution that is both pro-consumer and pro-technology is a filter to block unwanted or unauthorized material that works in the same manner as anti-virus software,” Bainwol said. “The ‘Sense of the Congress’ provision within this bill is a strong signal that lawmakers recognize that viable filtering technology is available now and that P2P businesses should prevent illegal activity to protect consumers.”

In anticipating Wednesday’s vote, P2P United, a trade group representing the file-swapping networks, urged Congress to support a moratorium on criminal penalties until a summit of all stakeholders could be held.

P2P United supports a compensation scheme proposed in February by the Electronic Frontier Foundation (EFF), a digital rights organization. According to the plan, the music industry would organize a “collecting society,” similar to ASCAP and BMI, which then would offer file-sharers an opportunity to get legitimate for a set monthly fee.

In exchange, P2P users would be free to download whatever songs they like, using whatever software works best for them.

“The more people share, the more money goes to rights holders,” the EFF white paper sates. “The more competition in applications, the more rapid the innovation and improvement.”

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