II. TECHNOLOGY
The NII has the potential to be a robust and widely used medium for the creation, dissemination and use of information-based products and services. To realize this goal, the technical and security needs of users, service providers, carriers and content providers must be addressed. First, to be successful, the NII must deliver on its promise to facilitate the flow of information and information-based products and services to consumers. The easier it is for a consumer to retrieve, purchase or use an information product or service, the more likely it is that the consumer will do so. Second, content providers must have secure and reliable means for delivering information products and services to consumers. This means that content providers must be confident that the systems developed to distribute these works will be secure and that works placed on these systems will remain authentic and unaltered. If content providers cannot be assured that they will be able to realize a commercial gain from the sale and use of their products using the NII, they will have little incentive to use it. Third, service providers and carriers must be able to ensure that their systems which will serve as the physical infrastructure of the NII will address the needs of users and content providers.
Technological solutions are playing and will continue to play a significant role in meeting these needs. A wide variety of new tools to facilitate access and use of Internet-based information products and services are being rapidly developed and deployed. Concurrently, copyright owners are developing and implementing technical solutions to facilitate the delivery of protected works in an easy, consumer-friendly yet reliable and secure way. These solutions enable copyright owners not only to protect their works against unauthorized access, reproduction, manipulation, distribution, performance or display, but also serve to assure the integrity of these works and to address copyright management and licensing concerns.
A. CONTENT SECURITY AND USER ACCESS NEEDS
It is important to recognize that access needs of users of the NII have to be considered in context with the needs of copyright owners to ensure that their rights in their works are recognized and protected. One important factor is the extent to which the marketplace will tolerate measures that restrict access to or use of a copyrighted work. Conversely, without providing a secure environment where copyright owners can be assured that there will be some degree of control over who may access, retrieve and use a work, and, perhaps most importantly, how to effectuate limits on subsequent dissemination of that work without the copyright owner's consent, copyright owners will not make those works available through the NII. [505]
Technology can provide the solutions for these needs. Technological solutions exist today and improved means are being developed to better protect digital works through varying combinations of hardware and software. Protection schemes can be implemented at the level of the copyrighted work or at more comprehensive levels such as the operating system, the network or both. For example, technological solutions can be used to prevent or restrict access to a work; limit or control access to the source of a work; limit reproduction, adaptation, distribution, performance or display of the work; identify attribution and ownership of a work; and manage or facilitate copyright licensing.
B. THE INTERNET EXPERIENCE
In the past few years, there has been an explosion in the popularity and volume of use of the Internet. The Internet serves today, through electronic mail and remote access, to connect people to information and to deliver information products and services. An almost incomprehensible variety of information has been made widely and easily accessible through this system, originally designed to serve the needs of the Department of Defense in the 1960s.
Because the Internet and applications which use it, like electronic mail and "World Wide Web," have exploded in popularity and use, systems used today and being designed for short term implementation are likely to serve as the foundation for communications through the NII. Indeed, in one very real sense, the Internet that is in use today is a prototype for the NII. Therefore, it is useful to discuss briefly the foundation of the Internet as it exists today.
The Internet provides individuals many different ways to disseminate and retrieve information. The basic concept of communications underlying the Internet is that a user with his or her personal computer or workstation can "connect," either directly or through a succession of intermediary computers, in a uniform manner to a "remote" computer that acts as a "server" of information. The user attaches to the remote computer and uses the services offered by the remote computer system (hence the term "server" for the remote system). The service may provide for immediate transfer of information (e.g., file transfer) or eventual transmission (e.g., electronic mail). For example, a user can direct a remote computer to send data through an established connection to the user's computer. Alternatively, the user can send information to the remote computer that will eventually result in information being sent back to the user's computer from that remote computer. In either sense, there is a "connection" established between the two computers that permits the flow of information, typically at the request of the user.
The simplest type of connections use a character-based "dumb terminal" interface (e.g., characters alone are used to convey information to and from the user). This type of scheme consists essentially of the user using his computer to do nothing more than type commands which the computer executes. The "controlled" computer executes the appropriate programs that handle location and transfer of data. One such scheme is the "telnet" protocol. Telnet uses a command line interface (e.g., one types commands) to initiate actions at the remote computer. Using telnet, a user can execute a program or routine on a remote computer to obtain a directory of files resident on that computer, navigate among directories of information, and transfer files.
If a user wishes to simply retrieve information stored as a file on the remote server, he or she can execute a process on the remote computer termed "file transfer protocol" or ftp. This is the most basic form of transfer; one simply instructs the remote computer to send to a specific file resident on the remote computer to the requester’s computer. A menu driven interface and service for retrieving files from remote servers was subsequently developed by the University of Minnesota. This scheme, termed "gopher," relies on established directories of information that are consolidated at specific sites on the Internet. The requester uses his or her computer to instruct the remote computer to execute the gopher program, which then establishes a connection to a directory server (e.g., a "gopher server"). The gopher server will provide the requesting user easily navigable listings of files that can be retrieved from the gopher server. The gopher server acts more or less as a conduit for identifying a specific file and delivering it to the requesting computer.
Other schemes have been established for searching pre-established indices of information about information resources on the Internet. Examples include "Archie," "Veronica" and the Wide Area Information Search (WAIS). [506] All of these examples were originally developed as UNIX-implemented programs to perform file transfer-related tasks; namely, searching and retrieval of information about either the location of remote servers with certain types of information or of remote servers that had specific files. The information sent back to the user with these tools consists of information about these servers that can then be used with the other tools (e.g., ftp or gopher) to retrieve a specific file.
There are now more sophisticated tools for users to access and retrieve information on remote servers on the Internet. These tools typically are programs that implement the common UNIX-based protocols but which actually run on the user's personal computer or workstation. Thus, once a connection to an appropriate "Internet provider" is established, a user may start a program on his personal computer that acts as a "gopher client." The "gopher client" will permit the user to retrieve information from a remote server directly to his or her personal computer. Connections between the user's personal computer and the "Internet provider" to carry these communications can be established using a "dial-up" or analog phone connection using an appropriate communication protocol or a link over a digital transmission line. The most significant benefit of these tools is that they are typically based on a graphical interface, which makes it easier for the user to manage the connection and interact with remote servers.
Many of the established protocols have been integrated and enhanced using tools that can access what is termed the World Wide Web. The World Wide Web (Web) is a scheme whereby organizations use graphical "front ends" to provide remote users with point and click access to information stored on their servers, as well as access through "links" to information stored on other remote servers. Web "browsers" are programs that run on a personal computer or workstation that enable a user to establish connections to these graphical front ends, view, retrieve and manipulate data provided by those remote servers. Examples of popular, currently available Web browsers include: Mosaic, from the National Center for Supercomputing Applications; Netscape Navigator, from Netscape Communications Corporation; and Enhanced Mosaic, from Spyglass, Inc. Web browsers typically provide support for electronic mail, gopher and ftp sessions, and, most importantly, support retrieval and display of a much broader variety of information (e.g., text, audio, image and multimedia data).
At the root of the Web are several of the established protocols (e.g., gopher, ftp, various e-mail standards) and three new protocols: the Hypertext Markup Language (HTML), a file format for embedding navigational information in graphical and text-based documents; the Hypertext Transfer Protocol (HTTP), a communications protocol for communicating navigational information and other data between the remote server and the requesting computer; and the Uniform Resource Locator (URL) scheme for identifying the location (e.g., the location of the remote server and the location on that server of the file corresponding to the URL) of Web-accessible documents. A number of organizations and groups are also working to develop additional protocols to enable secure communications. Some of these protocols have been published as draft specifications at this point, including the Secure Sockets Layer (SSL), the Secure Hypertext Transfer Protocol (SHTTP) and the Enhanced Mosaic Security Framework. The integration of these various protocols into a single, easy to use, understandable interface has led to a tremendous increase in the popularity and use of the World Wide Web and, correspondingly, of the Internet as a means for providing and retrieving information.
C. ACCESS AND USE TECHNOLOGICAL CONTROLS
1. SERVER AND FILE LEVEL CONTROLS
Technology will likely play a central role in implementing controls on the access to and use of protected works at both the file and server level.
Distribution of digital works can be regulated by controlling access to the source of copies of the works -- information or data servers. Access to these servers can vary from completely uncontrolled access (e.g., the full contents of the server are available without restriction) to partially controlled access (e.g., unrestricted access is granted to only certain data on the server) to completely controlled access (e.g., no uncontrolled access in any form is permitted). Access control is affected through user identification and authentication procedures that deny access to unauthorized users to a server or to particular information on a server. [507]
Nearly all service providers, including commercial online services such as CompuServe and America Online, private dial-up bulletin board systems, and servers accessible through the Internet, control access to their systems. For example, via the Internet, users today can connect to a bewildering array of public servers using a variety of schemes, including telnet, ftp, gopher and the World Wide Web. Some information providers grant full unrestricted access to all the information contained on their servers, and use control simply to comport with physical limitations of their servers (e.g., to limit the number of concurrent users). Other information providers restrict access to users with accounts or grant only limited access to unregistered users. For example, using ftp a user can often log on to a remote server through the Internet as an "anonymous" user (e.g., a user for which no account has been created in advance); however, such a user will normally only be able to access specific data on the server. Of course, an information provider can elect not to provide uncontrolled access, and permit only those with pre-established accounts to access the server. This is more common with commercially-oriented on-line service providers. Control over access to a server containing protected works will typically be the first level of protection a content provider will look for before making their protected works accessible through the server.
A second level for controlling access to and use of protected works can be exerted through control measures tied to the electronic file containing the work.
Restrictions on access at the file level can be implemented using features in "rendering" software. For example, a content provider may develop specialized software products or implement features in general purpose software products that would control by whom, and to what degree, a protected work may be used. Such restrictions could be implemented using features in the rendering software, a unique file format or features in an established file format, or a combination of both. "Control" measures could also be implemented to determine if the content provider had authorized certain uses of the work, as well as some means to control the degree to which a user would be able to subsequently "manipulate" the work. For example, the rendering software could preclude a user who had not obtained the appropriate authority from the content provider or who enters an unauthorized or expired password from using the data. Rendering software can also be written to deny general access to the work if the file containing the work is not a properly authenticated copy (e.g., the file has been altered from the version as distributed by the content provider). Such features will be possible provided that sufficient information regarding authorized use can be associated with the file containing the information product (e.g., through inclusion in a file header, packaged and sealed in an "electronic envelope" sealed with a digital signature, embedded through steganographic means, [508] etc.). [509]
2. ENCRYPTION
In its most basic form, encryption amounts to a "scrambling" of data using mathematical principles that can be followed in reverse to "unscramble" the data. File encryption thus simply converts a file from a manipulable file format (e.g., a word processor document or a picture file that can be opened or viewed with appropriate software) to a scrambled format. [510] Authorization in the form of possession of an appropriate "key" is required to "decrypt" the file and restore it to its manipulable format.
Encryption techniques use "keys" to control access to data that has been "encrypted." Encryption keys are actually strings of alphanumeric digits that are plugged into a mathematical algorithm and used to scramble data using that algorithm. Scrambling means that the original sequence of binary digits (i.e., the 1s and 0s that make up a digital file) that constitute the information object is transformed using a mathematical algorithm into a new sequence of binary digits (i.e., a new string of 1s and 0s). The result is a new sequence of digital data that represents the "encrypted" work. [511] Anyone with the key can decrypt the work by plugging it into a program that applies the mathematical algorithm in reverse to yield the original sequence of binary digits that comprise the file. Although most commonly thought of as a tool for protecting works transmitted via computer networks, encryption can be and is used with virtually all information delivery technologies, including telephone, satellite and cable communications. Of course, once the work is decrypted by someone with the key, there may be no technological protection for the work if it is stored and subsequently redistributed in its "decrypted" or original format.
A widely publicized technique for sending secure transmissions of data is "public key" encryption. This technique can be used to encrypt data using an algorithm requiring two particular keys -- a "public" key and a "private" key. The two keys are affiliated with the recipient to which the information is to be sent. The "public" key is distributed publicly, while the private key is kept secret by recipient. Data encrypted using a person's public key can only be decrypted using that person's secret, private key. For instance, a copyright owner could encrypt a work using the public key of the intended recipient. Once the recipient receives the encrypted transmission, he could then use his private key to decrypt that transmission. No secret (private) keys need to be exchanged in this transaction. Without the private key of the intended recipient, the work cannot be read, manipulated or otherwise deciphered by other parties. Of course, if a decrypted copy is made and shared, then others could manipulate the work unless other means are used to protect it.
There may be instances where someone other than the communicating parties needs access to the encrypted data. A key escrow system is one way such access might be obtained. A key escrow system would hold the key needed to decrypt an encrypted transmission in "escrow." Such a system could be maintained by a private organization or the government, and anyone seeking access to an encrypted transmission would have to demonstrate their need for the key through a process, such as obtaining a search warrant, that ensures the legitimate privacy and security needs of users of encrypted transmissions.
3. DIGITAL SIGNATURES
Mathematical algorithms can also be used to create digital "signatures" that, in effect, place a "seal" on a digitally represented work. Generating a digital signature is referred to as "signing" the work. The algorithms can be implemented through software or hardware, or both. The digital signature serves as means for authenticating the work, both as to the identity of the entity that authenticated or "signed" it and as to the contents of the file that encodes the information that constitutes the work. Thus, by using digital signatures one will be able to identify from whom a particular file originated as well as verify that the contents of that file have not been altered from the contents as originally distributed.
A digital signature is a unique sequence of digits that is computed based on (1) the work being protected, (2) the digital signature algorithm being used, and (3) the key used in digital signature generation. [512] Generating a digital signature uses cryptographic techniques, but is not encryption of the work; the work may remain unencrypted so it can be accessed and used without decryption. In fact, digital signatures and encryption can be used simultaneously to protect works. Generally, a signature is computed for a copyrighted work first and then the work (including the seal) is encrypted. When the work is to be used, the work is decrypted, then the signature (i.e., the seal) is verified to be sure the work has not been modified (either in its original or encrypted form). If the work is never changed, the seal need never be removed or changed. If the work is changed, a new seal must be computed on the revised information.
Typically, the digital signature is incorporated in some manner in the transmission that constitutes the work. Often, the sender will also distribute his public key as well. The signature serves as a "seal" for the work because the seal enables the information to be independently checked for unauthorized modification. [513] If the seal is verified (independently computed signature matches the original signature), then the work is a bona fide copy of the original work -- i.e., nothing has been changed in the file that constitutes the work.
4. STEGANOGRAPHY
Innovative new techniques are being developed to address security or management driven concerns relating to dissemination and use of digitally-encoded information. For example, methods have been developed that can encode digitized information with attributes that cannot be disassociated from the file that contains that information. This field of technology has been termed "steganography" and been conceptually referred to as "digital fingerprinting" or "digital watermarking."
In essence, using steganographic techniques, a party can embed hidden messages in digitized visual or audio data. The embedded information does not degrade or otherwise interfere with the audio or visual quality of the work. Instead, the embedded information can only be detected if specifically sought out. More advanced steganographic techniques based on statistical or entropically-directed encoding are proving to be difficult to defeat. For example, one system modulates a known noise signal with the information to be embedded and adds the "scaled" signal to the original data. Once encoded in this fashion, the steganographically encoded identification data is distributed throughout the work as subliminal noise and, like noise, cannot be fully eliminated from the work. Thus, one can ensure detection of an embedded message even after substantial corruption of the data, such as might occur through compression/decompression, encoding, alteration or excerpting of the original data. By providing a means to indelibly tag a work with specific information, steganography is likely to play a complementary role to encryption as well as authentication techniques based on digital signatures.
D. CONTROLLING USE OF PROTECTED WORKS
Content providers will rely on a variety of technologies, based in software and hardware, to protect them against unauthorized uses of their information products and services.
One example can be found in the Audio Home Recording Act. This Act requires that manufacturers of digital audio recording devices and digital audio interface devices incorporate features that limit serial copying.514 The hardware is programmed to read certain coding information contained in the "digital subcode channel" of digital sound recordings and broadcasts. Based on the information it reads, the hardware circuitry will permit unrestricted copying, permit copying but label the copies it makes with codes to restrict further copying, or disallow copying. The serial copy management system allows unlimited first generation copying -- digital reproduction of originals (such as CDs distributed by record companies), but prevents further digital copying from those reproductions. [515]
Similar systems can be implemented through hardware, software or both, using the concepts discussed above (e.g., rendering software and encryption technology). For example, files containing works can include instructions used solely to govern or control distribution of the work. This information might be placed in the "header" section of a file [516] or another part of the file. In conjunction with receiving hardware or software, the information, whether in the header or elsewhere, can be used to limit what can be done with the original or a copy of the file containing the work. It can limit the use of the file to view- or listen-only. It can also limit the number of times the work can be retrieved, opened, duplicated or printed.
E. MANAGING RIGHTS IN PROTECTED WORKS
Systems for managing rights in works are being contemplated in the development of the NII. These systems will serve the functions of tracking and monitoring uses of copyrighted works as well as licensing of rights and indicating attribution, creation and ownership interests. A combination of file- and system-based access controls using encryption technologies, digital signatures and steganography are, and will continue to be, employed by owners of works to address copyright management concerns. Such security measures must be carefully designed and implemented to ensure that they not only effectively protect the owner's interests in the works but also do not unduly burden use of the work by consumers or compromise their privacy. And measures should be studied to ensure that systems established to serve these functions are not readily defeated.
To implement these rights management functions, information will likely be included in digital versions of a work (i.e., copyright management information) to inform the user about the authorship and ownership of a work (e.g., attribution information) as well as to indicate authorized uses of the work (e.g., permitted use information). For instance, information may be included in an "electronic envelope" containing a work that provides information regarding authorship, copyright ownership, date of creation or last modification, and terms and conditions of authorized uses. As measures for this purpose become incorporated at lower levels (e.g., at the operating system level), such information may become a fundamental component of a file or information object.
Once information such as this is affiliated with a particular information object (e.g., data constituting the work) and readily accessible, users will be able to easily address questions over licensing and use of the work. For example, systems for electronic licensing may be developed based on the attribution or permitted use information associated with an information object. Electronic contracts may be used. [517] Providers may inform the user that a certain action -- the entering of a password, for instance, to gain access to the service or a particular work, or merely the use of the service -- will be considered acceptance of the specified terms and conditions of the electronic license.
The Library of Congress' Electronic Copyright Management System may be instrumental in rights management schemes. The proposed system, which is under development, has three distinct components: (1) a registration and recordation system, (2) a digital library system with affiliated repositories of copyrighted works, and (3) a rights management system. [518] The system will serve as a testbed to gain experience with the technology, identify issues, prototype appropriate standards, and serve as a working prototype if full deployment is pursued later.
An important element of doing business in the digital environment will be the ability to move money from users to the providers of the various information and entertainment products and services [519] Presently, transactions follow models wherein the actual assets do not move in the system, but rather only representations of the assets. That is to say, if a consumer selects a pay-for-view motion picture from a cable service provider, the consumer gives the service provider a credit card number. The service provider sends the credit information to a clearinghouse where it is verified and sent on to a bank for payment. Such methods of payment are relatively expensive because of the number of players and transactions involved.
Some believe that a more efficient and cheaper method of payment is "digital cash." Using a digital cash system, actual assets are transferred through digital communications means in the form of individually identified representations of bills and coins -- similar to serial numbers on hard currency. There are a number of systems being developed to accomplish such money movement, which should allow consumers to move actual assets through the NII or GII, rather than simply transferring a message to other existing systems to move the money for a transaction.
One payment system relies on the existing credit and debit card and banking systems. It avoids transaction costs by simply accumulating users’ transactions and charging their debit card or billing the accumulated charges to their credit card once in a fixed time period, depending on volume and the cumulative amount of charges. However, the use of the third party bank for verification and collection adds cost to the transactions. In addition, the anonymity of cash purchases is lost, and there is an increased risk that transactions may be monitored by organizations that track spending habits of consumers.
A more complex system uses “smart cards” and public key encryption to move actual assets within the system. Such systems are common in Europe, for instance, for public transportation and telephone charges. Under such systems, a pre-paid card with a programmed amount of value or "cash" is issued to a consumer, and the card's account is debited when it is used for a purchase. Such systems protect anonymity because debiting of the card does not require the consumer to reveal her identity; it is legal tender just like cash. Such systems for use in the NII and GII are under development by both European and U.S. firms.
F. ENCRYPTION EXPORT CONTROL
U.S. manufacturers are currently prevented from exporting software and hardware with certain types of encryption technology. [520] This is due to an export licensing system developed over the last 50 years in order to limit proliferation of encryption technology that could hinder efficient intelligence gathering and effective law enforcement. U.S. software manufacturers that produce "mass market" products indicate that there is a significant demand internationally for software products with strong encryption capabilities. They believe that their inability to deliver such products is leading to the development and sale of these needed products by foreign software developers. Relaxation of export controls would permit U.S. businesses to compete with foreign companies that presently incorporate strong encryption technology in their products, but would make it even more difficult for the United States and its allies to fight international terrorism, narcotic trafficking, corruption, smuggling of nuclear materials, and other criminal activities.
Export controls are administered through a bifurcated system in the United States. The nature of the technology, product or information to be exported dictates the Agency from which the party wishing to export must turn to obtain a license to export.
• Export licensing of arms, ammunition, and implements of war is handled by the Office of Defense Trade Controls (ODTC) of the Department of State pursuant to the Arms Export Control Act. [521]
• Export licensing of items not exclusively controlled for export by another Department or agency of the Federal Government is handled by the Bureau of Export Administration (BXA) of the Department of Commerce. [522]
When a party wishes to export products containing an encryption technology, a Commodity Jurisdiction (CJ) Ruling is made that determines whether the item is on the Munitions List or the Commerce Control List (CCL). If the item is determined to be on the Munitions list, the State Department reviews the request for an export license. Conversely, if the item is found to be on the CCL, then it is assigned an Export Control Classification Number (ECCN) which is used to determine the requirements for its export licensing. [523] The Commerce Department has exclusive statutory jurisdiction over licensing of CCL items, and in practice presents a less stringent licensing scheme than for munitions items.
Development of an optimal NII and GII requires strong security as well as strong intellectual property rights. Copyright owners will not use the NII or GII unless they can be assured of strict security to protect against piracy. Therefore, encryption technology is vital because it gives copyright owners an additional degree of protection against misappropriation.
Encryption is equally important to other users of the NII and GII as well. Industries that transmit sensitive information -- either internally or to other businesses -- also require high levels of security. Banks, accounting firms, and securities houses are prime examples of businesses that routinely transmit sensitive transactional information. In addition, absent strong encryption, medical and legal professionals using the NII may have difficulty reassuring their clients that sensitive personal information will not be compromised.
The growth of the NII and GII is sparking increased international demand for encryption technology. However, for national security reasons, the United States strictly controls the export of many encryption products for sale abroad. This policy protects vital U.S. national security and law enforcement interests, but critics contend that it is slowing the spread of encryption technologies that could be used to protect intellectual property transmitted through the NII and GII and causing U.S. manufacturers to lose sales to foreign competitors who are not constrained by U.S. export controls. To evaluate these complaints, the Clinton Administration has directed the Commerce Department, through the newly created Office of Strategic Industries and Economic Security, to conduct studies on the export controls of encrypted software and their impact on U.S. manufacturers -- which were expected to be completed by July 1995.
Recognizing the important role that encryption technology plays in fostering a secure and useful NII, the Working Group supports efforts to work with industry on key-escrow encryption technologies and other encryption products which could be exported without compromising U.S. intelligence gathering and law enforcement. The Working Group believes that proliferation of such technology will enable U.S. industry to meet the needs of the international market for these products and continue to lead the development of the GII.
G. DEVELOPMENT OF STANDARDS
A common concern related to development of the NII is the development of standards. Obviously, some level of interconnection, interoperability and standardization of telecommunications, computer, wireless, satellite, broadcast and cable television technologies and networks will be needed to achieve the full potential of the NII. The need for standards, however, does not suggest that any one entity must be established to develop and implement a comprehensive suite of standards. Rather, consistent with historical trends firmly established in the computer industry, the marketplace will develop the best suite of standards to make the NII viable.
The computer industry tends to follow certain general trends in the development and implementation of solutions to commonly encountered problems. [524] The most common trend is for an "early implementer" to develop a "point-topoint" solution to a specific problem (e.g., a solution which solves the problem solely from the perspective of that developer's needs). Alternatively, a consortium of companies will work together to jointly develop a solution to address the problem. Depending on the frequency of the problem, other individual companies or consortia will develop different solutions to the problem. Over time, one solution will begin to emerge as a de facto industry standard. It may gain that status through consumer or user preference, through effective promotion by one company or a consortium of companies, or, more typically, a combination of both. Once it appears that an industry consensus is emerging, efforts begin to convert that de facto standard into a more formally recognized industry standard. This can occur through accreditation efforts sponsored by private organizations, such as the American National Standards Institute (ANSI) or the Institute for Electrical and Electronic Engineers (IEEE); through domestic governmental standard setting organizations, such as the National Institute for Standards and Technology (NIST), the Department of Energy (DOE) or the Department of Defense (DOD); or through international organizations like the International Telecommunication Union. As these de facto standards become established, either informally or formally, vendors and systems providers incorporate these standards into their products or make those products compatible with those standards. Once established, the standards tend to evolve to accommodate improvements using the standard setting organizations. Eventually, many standards are implemented at the operating system level. [525]
Understanding this common progression is important in understanding how the NII will likely develop. At this point in time, many different solutions are being developed to address the needs of users, content providers, service providers and carriers. Most of these developments fall into the class of point-to-point solutions to serve specific needs. As these early systems lead to development of standards, the various industries supporting the NII's development will formally or informally establish de facto and formally recognized standards. Once standards begin to emerge or become established, the major operating systems developers will incorporate or support them at the operating system level. Thus, solutions developed to address the needs and concerns of users, content providers, service providers and carriers will evolve and become integrated into the infrastructure of the NII.
Over time, point-to-point solutions will become established as standards and/or incorporated into operating systems. When this happens, uniform means for identifying the author of a work, authenticating the contents of an information object, ensuring the secure transmission of information objects between remote sites, and authorizing subsequent use of information objects after the first transfer, will be possible. At this point, however, given the nascent state of the NII, it would be inappropriate to suggest that a comprehensive system could best be devised from a central planning perspective.
Interoperability and interconnectivity of networks, systems, services and products operating within the NII will enhance its development and success. Standardization of copyright management (standardized header information and format, for instance), as well as technological protection methods (such as encryption), may also be useful. The question of whether any standards should be established, either through government regulation or industry consensus, however, is not within the purview of this Working Group. The issue of what those standards should be, if established, is similarly outside the scope of the area of inquiry of the Working Group. [526] If a standard is established, however, protection of intellectual property rights used in that standard is of concern to this Group.
The intellectual property rights implications of the standards-setting process are not new with the development of the NII. The Federal Communications Commission, for instance, has established standards in related areas without interfering with the legitimate rights of intellectual property rights owners. [527]
The Working Group finds that in the case of standards to be established, by the government or the private sector, the owner of any intellectual property rights involved must be able to decline to have its property used in the standard, if such use would result in the unauthorized exercise of those rights. If the rights holder wishes to have its intellectual property as part of the standard, an agreement to license the necessary rights on a nondiscriminatory basis and on reasonable terms may be required. In the case of de facto standards, arising out of market domination by an intellectual property rights holder, the antitrust laws may provide a remedy for anticompetitive uses of the standards.
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Notes:
505. For a detailed discussion of these and other applications of technology that may be used to provide protection for copyrighted works, see Symposium, Technological Strategies for Protecting Intellectual Property in the Networked Multimedia Environment, cosponsored by the Coalition for Networked Information, Harvard University, Interactive Multimedia Association, and the Massachusetts Institute of Technology (April 2-3, 1993); see also M. D. Goldberg & J. M. Feder, Copyright and Technology: The Analog, the Digital, and the Analogy, Symposium, WIPO Worldwide Symposium on the Impact of Digital Technology on Copyright and Neighboring Rights, 37 (March 31 - April 2, 1993).
506. Archie is a service which provides directories of repositories of gopher servers; Veronica provides indices of documents which contain key words.
507. The most common elements of such systems involve authentication of the user desiring access to the server. Typically, the server will require entry of a user name and a password. More elaborate mechanisms, however, have been developed. For example, some servers do not grant access once a user is verified, but rather, they terminate the connection and reestablish it from the server to the registered user's site. Such call-back systems tend to govern fully controlled server environments (e.g., where access will only be granted to known and verified users). Other systems are being implemented that use more elaborate authentication systems. For example, a number of companies are developing hardware key systems that require the user, after establishing a preliminary connection, to verify that connection by inserting a hardware device similar to a credit card into the user's computer system. That device then sends an indecipherable code to verify the identity of the user.
Protection of works by means of access control mechanisms assumes that the system in question is in a physically secure environment and is not vulnerable to external means to circumvent access control. Several instances have been reported where the security of a supposedly secure server system was compromised, for example, through passive monitoring during the exchange of unencrypted passwords. As a consequence, many are currently pursuing efforts to improve security at the access control level.
508. See discussion of stenography infra pp. 188-89.
509. For example, the software may deny access to a work if the electronic file containing the work has been altered or information stored in the file does not match data supplied by a user necessary to open and use the file. See discussion of digital signatures infra pp. 187-88.
510. Rendering or viewing software may integrate encryption and file manipulation into a single software package. In other words, the rendering software, after getting a password, will decode the file and permit the user to manipulate the work (e.g., view it or listen to it), but only with the provided rendering software.
511. An algorithm is a set of logical rules or mathematical specification of a process which may be implemented in a computer.
512. The signature is generated using the binary digits of the work plus the value of the private key as inputs to the computation defined by the algorithm. Thus, the digital signature for an information object is a unique sequence of digits for that work. Specifically, a signature is not the same for different works using the same private key.
513. Anyone who has access to an information object, in addition to having access to the work, also has access to the digital signature for the object. Consequently, the digital signature for the object may be recomputed and used to independently confirm the integrity of the object by comparing it to the digital signature appended to the object.
514. See 17 U.S.C. § 1002 (Supp. V 1993).
515. See H.R. REP. NO. 102-873(I), 102d Cong., 2d Sess., reprinted in 1992 U.S.C.C.A.N. 3578, 3579-80, 3583 n15.
516. A "header" is a section of a digital work where information, data, codes and permitted uses may be embedded. Such information may actually be embedded anywhere in the work, but for ease of reference, this Report refers to such information as embedded in a header. Terms such as "label" and "wrapper" are also used to refer to what this Report refers to as a "header."
517. See discussion of electronic contracting supra pp. 53-59.
518. See R.E. Kahn, Deposit, Registration and Recordation in an Electronic Copyright Management System, Proceedings of Technical Strategies for Protecting Intellectual Property in the Networked Multimedia Environment, Interactive Multimedia Assoc. (Jan. 1994). The registration and recordation system will be operated by the Library of Congress and will enable electronic filing of documents, automated registration and recordation of transfers of ownership and other copyright-related documents. The digital library system will be composed of a set of distributed repositories for copyrighted works, and will support search and retrieval based upon an electronic bibliographic record. The rights management system will be a distributed system which will permit use of selected copyrighted materials on the Internet, and will have some on-line rights-granting services. Electronic mail will be used to license nonexclusive rights, with or without recordation of the transactions.
519. The IITF Committee on Applications and Technology is addressing electronic commerce issues, including the electronic transfer of funds through the NII.
520. There is an ongoing review of policies governing the export of computer and networking technologies that incorporate effective encryption technology, and there has been some relaxation of prior controls. For example, technologies used to identify and authenticate users and files are generally not restricted. This, however, does not address the concerns as articulated by U.S. manufacturers.
521. ODTC maintains the U.S. Munitions List -- a list of specific technologies subject to their review for export licensing purposes. See 22 U.S.C. § 2778 (1988).
522. BXA maintains the Commerce Control List (CCL), which governs export control of all items (commodities, software, and technical data) subject to BXA export controls. See 15 C.F.R. § 799.1(a) (1994).
523. See 15 C.F.R. § 799.1(g) (1994).
524. Many examples of this evolutionary pattern exist. Examples of de facto and formally recognized standards that derived from a single company include the Hayes-compatible modem command set, developed by the Hayes Company to control its modem products; the Ethernet local area network standard developed by Xerox to link minicomputers at the Palo Alto Research Center which eventually led to the development of the IEEE 802.3 standard; and the PCL and Postscript printer control/page description languages, developed by Hewlett-Packard and Adobe, respectively.
Examples of standards that evolved from a collaboration of companies include: the Extended Industry Standard Architecture (EISA) bus standard, introduced by a consortium of nine companies including AST Research, Compaq, Epson, Hewlett-Packard, NEC, Olivetti, Tandy, Wyse, and Zenith; the Musical Instrument Digital Interface (MIDI) interface standard for the connection of synthesizers, instruments, and computers, developed by the major synthesizer manufacturers; and the Personal Computer Memory Card International Association (PCMCIA) standard for PC Cards, PC Card-based peripherals, and the slot designed to accept them developed by the PCMCIA group of manufacturers and vendors.
525. For example, essentially every modern personal computer operating system available today supports a number of de facto or recognized industry standards such as Ethernet, PCL/Postscript, and TCP/IP.
526. The IITF Committee on Applications and Technology has responsibility for addressing the issue of standards.
527. Recently, the FCC adopted technical standards that define a patented system as the AM radio stereophonic transmitting standard in the United States. See 58 Fed. Reg. 66,300 (daily ed. Dec. 20, 1993). The FCC conditioned the selection of the patented system as the standard on the agreement of the patent owner to license its patents to other parties "under fair and reasonable terms." Id. at 66,301.
Intellectual Property and the National Information Infrastru
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III. EDUCATION
A. BACKGROUND
Public awareness of the importance of intellectual property in the information age is essential to the successful implementation and growth of the NII. The average citizen has only the most general understanding that there are patents, copyrights and trademarks, let alone an understanding of the legal, economic and trade issues involved. Indeed, many lawyers do not have an understanding of this highly specialized area of the law. However, as the convergence of computer and communications technology brings the capability of high speed computers and communications networks into our homes, we all have the possibility to become not only authors and users of copyrighted works, but printers, publishers, exhibitors and distributors as well.
Most people do not have a very clear idea about the role of intellectual property law in encouraging creativity and the importance of intellectual property to our economic well-being. Recent studies show that the core copyright industries -- those that create copyrighted works -- represent an estimated $238.6 billion in annual contribution to the U.S. economy. Moreover, other related industries, such as those that distribute copyrighted works, account for an additional contribution of approximately $120 billion annually. Between 1991 and 1993, while the entire U.S. economy grew at an annual rate of approximately 2.7 percent, the core copyright industries grew twice as fast, at the rate of 5.6 percent. Furthermore, the employment generated by these industries grew at four times the annual rate of the whole economy in the period between 1988 and 1993.528 Users must learn enough about this topic to appreciate just what respect for intellectual property laws can do for them, and why a seemingly harmless transaction on a computer network may have a great effect on the benefits they get from the intellectual property system.
Users are likely creators, too. In that role they will benefit directly from being able to decide how and under what conditions other users will be able to use their works. It may be that a user will decide to dedicate his or her work to the community at large and not assert the rights that the law grants. Others may chose to assert their rights in a general way and make their works available on a good faith "pay if you like it" basis like much of the shareware available today. Others may insist on strict enforcement of their rights and allow only specified access on limited terms and conditions. The point is that all users should understand the law sufficiently to know that they have all of these options available to them. Copyright is the body of law that lets such a system work. It appropriates to intangible goods -- copyrighted works -- the characteristics of tangible property. This is what lets the information marketplace work.
While it is necessary to increase public awareness in these areas, it will not be easy. Intellectual property law is typically perceived by non-lawyers as being incomprehensible with its own "technical" jargon and legalistic terminology that do not provide clear cut rules in many circumstances. Many often resist learning such "legalese" and want to see clearer and more easily understandable rules. Unfortunately, a mere recitation of "do’s and don’ts" is not enough to explain to NII users how the copyright system affects their interests, and why certain activities are not allowed by the law.
It is not only intellectual property law that presents complexities for the NII user. The underlying information technology is also difficult to understand, and it is constantly evolving and presenting users with new capabilities. Just learning about these capabilities and how to use them is difficult enough for users. It is also difficult for users to understand that they may not be able to always use all of the new facilities to copy, perform and use works that the technology allows.
Overcoming these barriers is also difficult because the market for copyrighted works is complex with many participants. Individual users generally do not appreciate the impact that an unauthorized use of a protected work can have in that market. This is especially true when the unauthorized use has an immediate benefit to the user, and no immediately visible harm to others. How tempting it is to simply make yourself a copy of a piece of shareware and not pay its author, or to make just one copy of a sound recording that someone has put up on a bulletin board. What harm could there be? However, in Cyberspace, where reproduction and dissemination are so easy and quick, even one unauthorized reproduction -- onto a server for instance -- can have a substantial ripple effect that could even supplant the market for legitimate copies of the work. Just think what happens to the shareware author’s expectation of a profit or the sales of a commercial sound recording if ten thousand individuals make such seemingly harmless personal copies.
B. COPYRIGHT AWARENESS CAMPAIGN
To address these concerns about education, the Working Group has initiated the Copyright Awareness Campaign. The kick-off meeting of the Campaign, which was held in March 1995, brought together educator associations, media organizations, copyright owners, the Copyright Office, and the Departments of Education and Commerce to begin this important discussion on how to educate the public on the importance of copyright in the NII. All of the participants agree that this Campaign is critical to the successful development of the NII, and many suggestions were offered on how best to educate the public.
The participants in the Campaign generally agreed that education of the public about intellectual property has a number of aspects. First, public awareness needs to be raised about the existence of copyright law and the protections that it provides. Second, model curricula need to be developed so that state and local educators (and other organizations) have available to them comprehensive material about intellectual property that could be incorporated into all levels of education. Third, the public needs quick access to up-to-date information on intellectual property rights, and guidance as to where the information is located.
The first goal -- raising public awareness of the existence of intellectual property -- is a broad goal to which anyone may contribute. The Campaign's participants felt that, at present, few people understand what intellectual property is, or the types of intellectual property protection available. Generally, owners of intellectual property should strive to get the word out about intellectual property, whether individually or collectively, so that the public becomes more familiar with the concept. As people begin to associate intellectual property with public benefits, they will be more receptive to learning about and respecting intellectual property.
The second goal is to develop educational curricula about intellectual property -- especially with regard to its role in the NII. In addition to heightening public awareness, such curricula would reinforce the important role of intellectual property as an incentive to create and innovate, provide guidance as to legal use of protected works, and dispel the notion that intellectual property is a barrier to the public availability of works. The substantive components of the curricula may be broken down further into a number of elements. Initially, respect for copyright protection needs to be highlighted -- intellectual property needs to become a "household word." This element will work in conjunction with the goal of public awareness, but should focus more on the importance of intellectual property, and not simply on its existence. Second, a comprehensive program needs to be developed to target different educational levels. Not only must a curricula be developed and made available for all educational levels, but also a methodology must be established for the continual reinforcement of the importance of intellectual property throughout the lifelong learning of every NII user.
A number of initiatives that are presently underway in both the public and private sectors were reviewed during the kick-off meeting of the Copyright Awareness Campaign. While each of these initiatives is useful in its targeting of a specific audience, a more coordinated effort may be more successful. Ideally, copyright owners, users, and educators will seek to develop broad-based "model curricula" that incorporate all of the substantive issues that are required for useful education about copyright. Such model curricula could then be disseminated to state school boards, private schools, libraries, community centers and other educational institutions for incorporation into their programs.
In considering such model curricula, the Campaign's participants noted that a number of factors should be considered, including the age of the persons being taught, their level of experience with the NII, the specific applications for which they use the NII, and their previous exposure to intellectual property laws. Certain core concepts should be introduced at the elementary school level -- at least during initial instructions on computers or the Internet, but perhaps even before such instruction. For example, the concepts of property and ownership are easily explained to children because they can relate to the underlying notions of property -- what is "mine" versus what is "not mine," just as they do for a jacket, a ball, or a pencil. At the same time that children learn basic civics, such as asking permission to use somebody else's pencil, they should also learn that works on a computer system may also be property that belongs to someone else. Therefore, they should learn what one participant refers to as "electronic citizenship," including how to determine the owner of a work, and how to go about asking for permission to use it. Similarly, they should learn that the taking of someone else's property, including copyrighted works, without permission is not right. Additionally, as noted previously, users will also be creators of copyrighted works, and therefore should know what their rights are and that they may expect those rights to be respected by others.
Other concepts of intellectual property should perhaps be introduced later. Soon after learning about property and ownership, students should learn more about the various forms of intellectual property, and why their protection is so important. Students should learn about the many valuable technologies that would not have been developed without protections of the patent system to recover costly research and development investments. Similarly, students should be aware of the substantial economic contributions of the industries that rely on copyright protection -- including the computer, entertainment, publishing, and broadcasting industries. In addition, people of all ages should recognize that millions of U.S. workers are employed by industries that rely heavily on intellectual property protection, and that intellectual property rights are truly a matter of national interest.
Additional concepts regarding copyright may be explored throughout a person's education. For example, the economic rationale for granting authors and inventors exclusive property rights in their creative efforts for a limited period of time in order to foster creativity and innovation might fit neatly in a high school economics course. Similarly, a number of topics might be explored during social studies or history classes including the constitutional roots of patent and copyright law, the nature of a governmental grant of a property right, or the role of the copyright and patent systems in fostering the present day information and communications revolution. Business courses could discuss the concepts of licensing intellectual property rights, the use of intellectual property as a marketing device, the concept of intellectual property as a corporate asset, and the trademark concept of good will. At the college level, concepts of intellectual property could be included in many programs. For example, basic patent and trade secret law could be taught in all science and engineering programs, while copyright law could be included in any instruction dealing with literature, art or computer science.
Along with the initial consideration of the substantive component of what should be taught, a procedural component must also be determined. This component actually considers a number of related questions -- when should a specific topic be taught, and in what order as related to other topics; how should the specific topic be presented, including general tone; and what form of communication is most effective given the nature of the topic and the audience involved. The participants at the kick-off meeting discussed a number of factors that should be considered in making these determinations.
Determining when a topic should be presented depends on its degree of complexity. As noted earlier, basic concepts of intellectual property -- such as ownership -- are easily taught at a young age. More complicated topics, such as the exclusive rights of intellectual property owners and fair use, would likely be reserved for later study. However, complexity of the subject matter alone is not the only consideration. A complex topic can be simplified for earlier ages, leaving more detailed instruction for future study. For example, the basic notion of ownership may be introduced at an early age, but should also be reinforced when discussing exclusive rights, licensing, and in other related topics throughout a person's education. Thus, the answer to the question of when a given topic should be taught may be "always," with increasing degrees of complexity so that students are not overwhelmed by a subject that they are too young to understand.
A slightly different factor to consider is how a particular topic should be presented. A point raised in the first meeting of the Copyright Awareness Campaign was that copyright education should not be a series of "thou shall nots." Instead, education should carry a "just say yes" message -- that works may be accessed and used, and that seeking permission is not an insurmountable barrier. The prohibitions against unauthorized use of intellectual property should be cast in terms of a right to control one's property. The public should also understand that copyright protection is specifically prescribed for a limited period of time, after which the underlying work becomes dedicated to the public. In addition, users should recognize that as online licensing becomes more readily available for accessing protected works on the NII, the delays in seeking authorization from the property owner will be minimized.
Another problem with the determination of how a topic should be presented is ensuring accurate and consistent information. In order for the public to respect and participate in educational programs, they must be able to rely on the information they receive. As many private organizations have already developed their own educational materials -- often directed at specific audiences and applications -- confusion may result on the part of the layperson based on perceived "mixed signals" of what is and is not permitted. Therefore, as curricula and other educational programs are developed, clear and consistent information must be ensured in order to avoid confusion and contempt. A system for "peer review" of educational material by impartial editors may aid in presenting accurate and consistent information.
The third factor, and perhaps most important, is the form of communication used to deliver an education program. Clearly, audiences respond differently to varied methods of communication. Numerous methods have been suggested through the Copyright Awareness Campaign for getting the message across including: classroom learning; video instruction; distance learning; broadcast television and radio; satellite teleconferencing; cable television; on-line services; billboards; books, magazines, and other publications; music; and art. Combinations of these methods in copyright workshops will reinforce key concepts and help tie information together. Many of these forms of communication are already being used to educate the public about copyright law -- and the producers of these materials should work together to determine which methods are most effective for a given audience. The sharing of such information will go a long way toward reducing duplication of efforts -- especially those that are less effective.
Educators and media organizations can have tremendous impact on the procedural component because they possess the expertise required to determine whether a particular educational message is being effectively communicated. Through testing procedures, educators may determine whether certain concepts are comprehended by students. Similarly, through marketing surveys, media organizations can determine the forms of communication that are most effective for particular audiences. These methods of evaluation are already available for other educational and communication materials, thus requiring only minor adaptation for the evaluation of an intellectual property curricula.
The final goal of the Campaign is the establishment of a system that provides the public with easy access to accurate and up-to-date information on copyright, including guidance on when and how to get authorization to use copyrighted works. While educational programs and curricula may raise public awareness, they cannot teach the public every facet of the law as it applies to new and previously unencountered situations. People soon will become frustrated with such programs if they cannot get quick answers to their questions regarding compliance with copyright law. In order for NII users to comply with the law, they need to know where and how to receive additional information on copyright as they encounter new situations on the NII.
A number of methods could be used to provide this service. A directory of attorneys having expertise in a particular field, such as copyright issues dealing with educational or library applications, could be developed and maintained. Additionally, as was suggested in the Copyright Awareness Campaign, a package of copyright basics could be established on a World Wide Web home page for access by interested users. Similarly, a copyright information news group could be established on Usenet to keep users informed of where to go to get important copyright information. The U.S. Copyright Office provides on-line access to its circulars, announcements, and regulations (proposed and final), as well as information regarding registration information (original and renewal), and other recorded documents. Other private organizations also provide such information and counseling, often for nominal charges.
_______________
Notes:
528. See Copyright Industries in the U.S. Economy, supra note 426.
A. BACKGROUND
Public awareness of the importance of intellectual property in the information age is essential to the successful implementation and growth of the NII. The average citizen has only the most general understanding that there are patents, copyrights and trademarks, let alone an understanding of the legal, economic and trade issues involved. Indeed, many lawyers do not have an understanding of this highly specialized area of the law. However, as the convergence of computer and communications technology brings the capability of high speed computers and communications networks into our homes, we all have the possibility to become not only authors and users of copyrighted works, but printers, publishers, exhibitors and distributors as well.
Most people do not have a very clear idea about the role of intellectual property law in encouraging creativity and the importance of intellectual property to our economic well-being. Recent studies show that the core copyright industries -- those that create copyrighted works -- represent an estimated $238.6 billion in annual contribution to the U.S. economy. Moreover, other related industries, such as those that distribute copyrighted works, account for an additional contribution of approximately $120 billion annually. Between 1991 and 1993, while the entire U.S. economy grew at an annual rate of approximately 2.7 percent, the core copyright industries grew twice as fast, at the rate of 5.6 percent. Furthermore, the employment generated by these industries grew at four times the annual rate of the whole economy in the period between 1988 and 1993.528 Users must learn enough about this topic to appreciate just what respect for intellectual property laws can do for them, and why a seemingly harmless transaction on a computer network may have a great effect on the benefits they get from the intellectual property system.
Users are likely creators, too. In that role they will benefit directly from being able to decide how and under what conditions other users will be able to use their works. It may be that a user will decide to dedicate his or her work to the community at large and not assert the rights that the law grants. Others may chose to assert their rights in a general way and make their works available on a good faith "pay if you like it" basis like much of the shareware available today. Others may insist on strict enforcement of their rights and allow only specified access on limited terms and conditions. The point is that all users should understand the law sufficiently to know that they have all of these options available to them. Copyright is the body of law that lets such a system work. It appropriates to intangible goods -- copyrighted works -- the characteristics of tangible property. This is what lets the information marketplace work.
While it is necessary to increase public awareness in these areas, it will not be easy. Intellectual property law is typically perceived by non-lawyers as being incomprehensible with its own "technical" jargon and legalistic terminology that do not provide clear cut rules in many circumstances. Many often resist learning such "legalese" and want to see clearer and more easily understandable rules. Unfortunately, a mere recitation of "do’s and don’ts" is not enough to explain to NII users how the copyright system affects their interests, and why certain activities are not allowed by the law.
It is not only intellectual property law that presents complexities for the NII user. The underlying information technology is also difficult to understand, and it is constantly evolving and presenting users with new capabilities. Just learning about these capabilities and how to use them is difficult enough for users. It is also difficult for users to understand that they may not be able to always use all of the new facilities to copy, perform and use works that the technology allows.
Overcoming these barriers is also difficult because the market for copyrighted works is complex with many participants. Individual users generally do not appreciate the impact that an unauthorized use of a protected work can have in that market. This is especially true when the unauthorized use has an immediate benefit to the user, and no immediately visible harm to others. How tempting it is to simply make yourself a copy of a piece of shareware and not pay its author, or to make just one copy of a sound recording that someone has put up on a bulletin board. What harm could there be? However, in Cyberspace, where reproduction and dissemination are so easy and quick, even one unauthorized reproduction -- onto a server for instance -- can have a substantial ripple effect that could even supplant the market for legitimate copies of the work. Just think what happens to the shareware author’s expectation of a profit or the sales of a commercial sound recording if ten thousand individuals make such seemingly harmless personal copies.
B. COPYRIGHT AWARENESS CAMPAIGN
To address these concerns about education, the Working Group has initiated the Copyright Awareness Campaign. The kick-off meeting of the Campaign, which was held in March 1995, brought together educator associations, media organizations, copyright owners, the Copyright Office, and the Departments of Education and Commerce to begin this important discussion on how to educate the public on the importance of copyright in the NII. All of the participants agree that this Campaign is critical to the successful development of the NII, and many suggestions were offered on how best to educate the public.
The participants in the Campaign generally agreed that education of the public about intellectual property has a number of aspects. First, public awareness needs to be raised about the existence of copyright law and the protections that it provides. Second, model curricula need to be developed so that state and local educators (and other organizations) have available to them comprehensive material about intellectual property that could be incorporated into all levels of education. Third, the public needs quick access to up-to-date information on intellectual property rights, and guidance as to where the information is located.
The first goal -- raising public awareness of the existence of intellectual property -- is a broad goal to which anyone may contribute. The Campaign's participants felt that, at present, few people understand what intellectual property is, or the types of intellectual property protection available. Generally, owners of intellectual property should strive to get the word out about intellectual property, whether individually or collectively, so that the public becomes more familiar with the concept. As people begin to associate intellectual property with public benefits, they will be more receptive to learning about and respecting intellectual property.
The second goal is to develop educational curricula about intellectual property -- especially with regard to its role in the NII. In addition to heightening public awareness, such curricula would reinforce the important role of intellectual property as an incentive to create and innovate, provide guidance as to legal use of protected works, and dispel the notion that intellectual property is a barrier to the public availability of works. The substantive components of the curricula may be broken down further into a number of elements. Initially, respect for copyright protection needs to be highlighted -- intellectual property needs to become a "household word." This element will work in conjunction with the goal of public awareness, but should focus more on the importance of intellectual property, and not simply on its existence. Second, a comprehensive program needs to be developed to target different educational levels. Not only must a curricula be developed and made available for all educational levels, but also a methodology must be established for the continual reinforcement of the importance of intellectual property throughout the lifelong learning of every NII user.
A number of initiatives that are presently underway in both the public and private sectors were reviewed during the kick-off meeting of the Copyright Awareness Campaign. While each of these initiatives is useful in its targeting of a specific audience, a more coordinated effort may be more successful. Ideally, copyright owners, users, and educators will seek to develop broad-based "model curricula" that incorporate all of the substantive issues that are required for useful education about copyright. Such model curricula could then be disseminated to state school boards, private schools, libraries, community centers and other educational institutions for incorporation into their programs.
In considering such model curricula, the Campaign's participants noted that a number of factors should be considered, including the age of the persons being taught, their level of experience with the NII, the specific applications for which they use the NII, and their previous exposure to intellectual property laws. Certain core concepts should be introduced at the elementary school level -- at least during initial instructions on computers or the Internet, but perhaps even before such instruction. For example, the concepts of property and ownership are easily explained to children because they can relate to the underlying notions of property -- what is "mine" versus what is "not mine," just as they do for a jacket, a ball, or a pencil. At the same time that children learn basic civics, such as asking permission to use somebody else's pencil, they should also learn that works on a computer system may also be property that belongs to someone else. Therefore, they should learn what one participant refers to as "electronic citizenship," including how to determine the owner of a work, and how to go about asking for permission to use it. Similarly, they should learn that the taking of someone else's property, including copyrighted works, without permission is not right. Additionally, as noted previously, users will also be creators of copyrighted works, and therefore should know what their rights are and that they may expect those rights to be respected by others.
Other concepts of intellectual property should perhaps be introduced later. Soon after learning about property and ownership, students should learn more about the various forms of intellectual property, and why their protection is so important. Students should learn about the many valuable technologies that would not have been developed without protections of the patent system to recover costly research and development investments. Similarly, students should be aware of the substantial economic contributions of the industries that rely on copyright protection -- including the computer, entertainment, publishing, and broadcasting industries. In addition, people of all ages should recognize that millions of U.S. workers are employed by industries that rely heavily on intellectual property protection, and that intellectual property rights are truly a matter of national interest.
Additional concepts regarding copyright may be explored throughout a person's education. For example, the economic rationale for granting authors and inventors exclusive property rights in their creative efforts for a limited period of time in order to foster creativity and innovation might fit neatly in a high school economics course. Similarly, a number of topics might be explored during social studies or history classes including the constitutional roots of patent and copyright law, the nature of a governmental grant of a property right, or the role of the copyright and patent systems in fostering the present day information and communications revolution. Business courses could discuss the concepts of licensing intellectual property rights, the use of intellectual property as a marketing device, the concept of intellectual property as a corporate asset, and the trademark concept of good will. At the college level, concepts of intellectual property could be included in many programs. For example, basic patent and trade secret law could be taught in all science and engineering programs, while copyright law could be included in any instruction dealing with literature, art or computer science.
Along with the initial consideration of the substantive component of what should be taught, a procedural component must also be determined. This component actually considers a number of related questions -- when should a specific topic be taught, and in what order as related to other topics; how should the specific topic be presented, including general tone; and what form of communication is most effective given the nature of the topic and the audience involved. The participants at the kick-off meeting discussed a number of factors that should be considered in making these determinations.
Determining when a topic should be presented depends on its degree of complexity. As noted earlier, basic concepts of intellectual property -- such as ownership -- are easily taught at a young age. More complicated topics, such as the exclusive rights of intellectual property owners and fair use, would likely be reserved for later study. However, complexity of the subject matter alone is not the only consideration. A complex topic can be simplified for earlier ages, leaving more detailed instruction for future study. For example, the basic notion of ownership may be introduced at an early age, but should also be reinforced when discussing exclusive rights, licensing, and in other related topics throughout a person's education. Thus, the answer to the question of when a given topic should be taught may be "always," with increasing degrees of complexity so that students are not overwhelmed by a subject that they are too young to understand.
A slightly different factor to consider is how a particular topic should be presented. A point raised in the first meeting of the Copyright Awareness Campaign was that copyright education should not be a series of "thou shall nots." Instead, education should carry a "just say yes" message -- that works may be accessed and used, and that seeking permission is not an insurmountable barrier. The prohibitions against unauthorized use of intellectual property should be cast in terms of a right to control one's property. The public should also understand that copyright protection is specifically prescribed for a limited period of time, after which the underlying work becomes dedicated to the public. In addition, users should recognize that as online licensing becomes more readily available for accessing protected works on the NII, the delays in seeking authorization from the property owner will be minimized.
Another problem with the determination of how a topic should be presented is ensuring accurate and consistent information. In order for the public to respect and participate in educational programs, they must be able to rely on the information they receive. As many private organizations have already developed their own educational materials -- often directed at specific audiences and applications -- confusion may result on the part of the layperson based on perceived "mixed signals" of what is and is not permitted. Therefore, as curricula and other educational programs are developed, clear and consistent information must be ensured in order to avoid confusion and contempt. A system for "peer review" of educational material by impartial editors may aid in presenting accurate and consistent information.
The third factor, and perhaps most important, is the form of communication used to deliver an education program. Clearly, audiences respond differently to varied methods of communication. Numerous methods have been suggested through the Copyright Awareness Campaign for getting the message across including: classroom learning; video instruction; distance learning; broadcast television and radio; satellite teleconferencing; cable television; on-line services; billboards; books, magazines, and other publications; music; and art. Combinations of these methods in copyright workshops will reinforce key concepts and help tie information together. Many of these forms of communication are already being used to educate the public about copyright law -- and the producers of these materials should work together to determine which methods are most effective for a given audience. The sharing of such information will go a long way toward reducing duplication of efforts -- especially those that are less effective.
Educators and media organizations can have tremendous impact on the procedural component because they possess the expertise required to determine whether a particular educational message is being effectively communicated. Through testing procedures, educators may determine whether certain concepts are comprehended by students. Similarly, through marketing surveys, media organizations can determine the forms of communication that are most effective for particular audiences. These methods of evaluation are already available for other educational and communication materials, thus requiring only minor adaptation for the evaluation of an intellectual property curricula.
The final goal of the Campaign is the establishment of a system that provides the public with easy access to accurate and up-to-date information on copyright, including guidance on when and how to get authorization to use copyrighted works. While educational programs and curricula may raise public awareness, they cannot teach the public every facet of the law as it applies to new and previously unencountered situations. People soon will become frustrated with such programs if they cannot get quick answers to their questions regarding compliance with copyright law. In order for NII users to comply with the law, they need to know where and how to receive additional information on copyright as they encounter new situations on the NII.
A number of methods could be used to provide this service. A directory of attorneys having expertise in a particular field, such as copyright issues dealing with educational or library applications, could be developed and maintained. Additionally, as was suggested in the Copyright Awareness Campaign, a package of copyright basics could be established on a World Wide Web home page for access by interested users. Similarly, a copyright information news group could be established on Usenet to keep users informed of where to go to get important copyright information. The U.S. Copyright Office provides on-line access to its circulars, announcements, and regulations (proposed and final), as well as information regarding registration information (original and renewal), and other recorded documents. Other private organizations also provide such information and counseling, often for nominal charges.
_______________
Notes:
528. See Copyright Industries in the U.S. Economy, supra note 426.
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Re: Intellectual Property and the National Information Infra
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IV. RECOMMENDATIONS
A. COPYRIGHT
It is difficult for intellectual property laws to keep pace with technology. When technological advances cause ambiguity in the law, courts look to the law's underlying purposes to resolve that ambiguity. However, when technology gets too far ahead of the law, and it becomes difficult and awkward to adapt the specific statutory provisions to comport with the law's principles, it is time for reevaluation and change. "Even though the 1976 Copyright Act was carefully drafted to be flexible enough to be applied to future innovations, technology has a habit of outstripping even the most flexible statutes." [529]
The Working Group has examined the adequacy of the Copyright Act to cope with the pace of technological changes. In applying the law to new uses, media and technology, the issues presented vary. Certain issues merely require an explanation of the application of the current law, and clearly are appropriately covered. Others present rights or limitations that clearly fit within the spirit of the law but the letter of the law is in need of clarification to avoid uncertainty and unnecessary litigation. Still others need new solutions. Technology has altered the balance of the Copyright Act -- in some instances, in favor of copyright owners and in others, in favor of users. The goal of these recommendations is to accommodate and adapt the law to technological change so that the intended balance is maintained and the Constitutional purpose is served. [531]
While it is not advisable to propose amendment of the law with every technological step forward, neither is it appropriate to blindly cling to the status quo when the market has been altered.
Throughout more than 200 years of history, with periodic amendment, United States law has provided the necessary copyright protection for the betterment of our society. The Copyright Act is fundamentally adequate and effective. In a few areas, however, it needs to be amended to take proper account of the current technology. The coat is getting a little tight. [533] There is no need for a new one, but the old one needs a few alterations.
1. THE TRANSMISSION OF COPIES AND PHONORECORDS
a. THE DISTRIBUTION RIGHT
The Copyright Act gives a copyright owner the exclusive right "to distribute copies or phonorecords of the copyrighted work" to the public. It is not clear under the current law that a transmission can constitute a distribution of copies or phonorecords of a work. [534] Yet, in the world of high-speed, communications systems, it is possible to transmit a copy of a work from one location to another. This may be the case, for instance, when a computer program is transmitted from one computer to ten other computers. When the transmission is complete, the original copy typically remains in the transmitting computer and a copy resides in the memory of, or in storage devices associated with, each of the other computers. [535] The transmission results essentially in the distribution of ten copies of the work. However, the extent of the distribution right under the present law may be somewhat uncertain and subject to challenge. Therefore, the Working Group recommends that the Copyright Act be amended to expressly recognize that copies or phonorecords of works can be distributed to the public by transmission, and that such transmissions fall within the exclusive distribution right of the copyright owner.
The proposed amendment does not create a new right. It is an express recognition that, as a result of technological developments, the distribution right can be exercised by means of transmission -- just as the reproduction, public performance and public display rights may be. [536]
It is argued by some that the existing right of distribution encompasses transmissions of copies and that no amendment is necessary. Indeed, the distribution right, as set forth in Section 106(3) of the Copyright Act, can be -- and, in at least one case, has been -- interpreted to include transmissions which distribute copies of works to, for example, the memories of computers. Transmission, it is argued, is logically and legally a means of distribution. The Working Group has no argument with such an interpretation; it properly conforms to the intent of the distribution right and, we believe, is correct from both a practical and legal standpoint.
Others suggest that amendment of the law may not be necessary because even if the distribution right does not cover the distribution of reproductions by transmission, the reproduction right is clearly implicated and that will protect the copyright owner. However, the fact that more than one right may be involved in infringing activity does not, and should not, mean that only one right should apply. [537] Each of the exclusive rights is distinct and separately alienable and different parties may be responsible for infringements or licensing of different rights -- and different rights may be owned by different people. [538] Because transmissions of copies may constitute both a reproduction and a distribution of a work, transmissions of copies should not constitute the exercise of just one of those rights. Indeed, those licensed only to reproduce a work should not be entitled to also distribute the work through transmission -- thereby displacing the market for the copyright owner or his distribution licensee.
Clearly, not all transmissions of copies of copyrighted works will fall within the copyright owner's exclusive distribution right. Moreover, even if a transmission of a copy falls within the scope of the right, it is not necessarily unlawful. First, the distribution must be a distribution to the public. The case law interpreting "publication" provides guidance as to what constitutes distribution to the public. [540] If a distribution would not constitute a publication of the work, then it would likely be found to be outside the scope of the copyright owner's distribution right. Therefore, the transmission of a copyrighted work from one person to another in a private e-mail message would not constitute a distribution to the public. [541] Second, all of the limitations, exemptions and defenses that currently apply to the distribution right and allow users to distribute certain copies to the public or to distribute copies under certain circumstances will continue to apply. For example, any exercise of one of the exclusive rights may be fair use -- including the reproduction and distribution of copies by transmission.
Some are of the view that the current language of the Act does not encompass distribution by transmission. They argue that the proposed amendment expands the copyright owner's rights without a concomitant expansion of the limitations on those rights. However, since transmissions of copies already clearly implicate the reproduction right, it is misleading to suggest that the proposed amendment of the distribution right would expand the copyright owner's rights into an arena previously unprotected. Further, even if the premise is correct (that the amendment expands the distribution right), the conclusion that the limitations of that right are not similarly expanded is invalid. The limitations on the right -- which place certain distributions to the public outside the scope of the copyright owner's right -- would necessarily expand to also place similar distributions by means of transmission outside the scope of the right.
Nevertheless, there is no reason to treat works that are distributed in copies to the public by means of transmission differently than works distributed in copies to the public by other, more conventional means. [542] Copies distributed via transmission are as tangible as any distributed over the counter or through the mail. Through each method of distribution, the consumer receives a tangible copy of the work.
When the public performance right was initially granted, it was thought to encompass only "live," in-person performances. When it became clear that copyrighted works could be publicly performed by other means -- i.e., broadcast and, later, cable transmissions -- the law was clarified. The same is true today with respect to the distribution right. Transmission is a means of distribution of copies, just as it can be a means of performance. However, the differences of opinion summarized above underscore the need for clarification and legal certainty. The costs and risks of litigation to define more clearly the right -- and the time achieving such clarity would take -- would discourage and delay use of the NII.
b. RELATED DEFINITIONAL AMENDMENTS
The Working Group also recommends other related amendments to two definitions.
TO "TRANSMIT"
As explained above, under current technology, a copy of a work may be transmitted. However, the Copyright Act defines only what it is to transmit a performance or display of a work. Therefore, the Working Group recommends that the definition of "transmit" in Section 101 of the Copyright Act be amended to include a definition of a transmission of a reproduction. [543]
How to delineate between these types of transmissions is a difficult issue to resolve. The transmissions themselves hold no clues; one type often looks the same as the other during the transmission. If the transmitter intends to transmit a performance of the work, as well as to distribute a reproduction of it -- or if the receiver is able to hear or see a performance of the work in the course of receiving a copy of it -- what rights are exercised by the transmission? A transmission could be a transmission of a reproduction or a performance or both. The resolution of these issues should rest upon the specific facts of the case. Such issues will typically be clarified between rightsholders and users in appropriate license arrangements. If confusion or disagreement exists in a specific context, the courts -- rather than Congress -- are in the better position to determine which, if any, exclusive rights are involved in a particular transmission. Courts regularly make such determinations in other cases where rights overlap. [544]
"PUBLICATION"
The legislative history of the Copyright Act makes clear that "any form of dissemination in which a material object does not change hands . . . is not a publication no matter how many people are exposed to the work." [545] Thus, a work that is only displayed or performed via the NII would not be considered published, no matter how many people have access to the display or performance, because a material object -- a copy of the work -- does not change hands. [546] However, in the case of transmissions of reproductions, the recipients of the transmissions receive copies of the work (i.e., copies of the work have been distributed) -- although they may not have "changed hands" in the literal sense.
Whether the transmission of copies of works is clearly within the scope of the distribution right is also a problem with respect to the act of publication by the transmission of copies. Indeed, the definition of "publication" incorporates the language used to describe the distribution right, which the Working Group's proposal amends. [547] Publication largely turns on whether the work has been distributed to the public. Thus, if copies of a work may be distributed to the public by transmission, then a work may be published by the transmission of copies to the public. Therefore, consistent with the proposed amendment of the distribution right, the Working Group recommends that the definition of "publication" in Section 101 of the Copyright Act be amended to recognize that a work may be published through the distribution of copies of the work to the public by transmission. [548]
The effects under the law of a work being considered published (rather than unpublished) generally are negative from the viewpoint of the copyright owner. Published works, for example: (1) must be deposited in the Library of Congress; (2) are subject to more limitations on the exclusive rights, including a broader application of fair use; (3) must meet certain author nationality or domicile requirements to be eligible for protection; and (4) must bear a copyright notice if published before March 1, 1989.549 However, the designation of works distributed to the public by transmission as published will be important in the case of works distributed first -- or solely -- on-line. The deposit requirement will aid in the preservation of those works, which otherwise might be updated or revised on-line, destroying -- or at least obscuring -- the original published versions. This may be particularly critical in preserving the scholarly and scientific record. [550]
Just as not all distributions of copies by transmission will constitute distributions to the public (and fall within the distribution right), not all transmissions of copies will constitute publication. Private e-mail messages would not be regarded as published. [551] Neither would other restricted transmissions of copies, such as those in a typical corporate setting, where transmissions of copies within the company computer network are restricted as to further distribution. [552] However, as in the print environment, the distribution of copies to a small group under circumstances where further distribution is authorized would publish the work. [553]
c. THE IMPORTATION PROVISIONS
The Working Group also recommends that the prohibitions on importation be amended to reflect the fact that, just as copies of copyrighted works can be distributed by transmission in the United States, they can also be imported into the U.S. by transmission. If an infringing literary work, for instance, were physically shipped into the U.S. in the form of a paper copy, a CD-ROM disk or even stored on a memory chip, then it would be an infringing importation if the statutory conditions existed. [554]
Cross-border transmission of copies of copyrighted works should be subject to the same restrictions as shipping them by airmail. Just as the distribution of copies of a copyrighted work is no less a distribution than the distribution of copies by mail, the international transmission of copies of copyrighted works is no less an importation than the importation by airmail.
Although we recognize that the U.S. Customs Service cannot, for all practical purposes, enforce a prohibition on importation by transmission, given the global dimensions of the information infrastructure of the future, it is important that copyright owners have the other remedies for infringements of this type available to them. Therefore, the Working Group recommends that Section 602 of the Copyright Act be amended to include importation by carriage or shipping of copies as well as by transmission of them.
2. PUBLIC PERFORMANCE RIGHT FOR SOUND RECORDINGS
Transmissions of sound recordings will certainly supplement and may eventually replace the current forms of distribution of phonorecords. In the very near future, consumers will be able to receive digital transmissions of sound recordings on demand -- for performance in the home or for downloading -- from the so-called "celestial jukebox." The legal nature of such transmissions -- whether they are performances or distributions -- has been widely debated. As discussed above, the Working Group recommends that Section 106 of the Copyright Act be amended to make clear that copies or phonorecords can be distributed by transmission. However, many of these transmissions will clearly constitute exercise of the public performance right -- a right which the Copyright Act fails to grant to copyright owners of sound recordings. [555]
The lack of a public performance right in sound recordings under U.S. law is an historical anomaly that does not have a strong policy justification -- and certainly not a legal one. Sound recordings are the only copyrighted works that are capable of being performed that are not granted that right. Therefore, for example, to transmit a performance of a sound recording without infringement liability, an audio-on-demand service acting as a "celestial jukebox" must obtain a license from, and pay a royalty to, the copyright owner of the underlying musical work (i.e., the person or entity who owns the rights in the notes and the lyrics), but it does not have to obtain permission from, or pay a license fee to, the copyright owner of the sound recording or the performer. The Working Group believes that this inequity should be rectified.
Public performance rights are granted in many foreign markets. Due to the lack of a performance right in the United States, U.S. performers and record companies are denied their fair share of foreign royalty pools for the public performance of U.S. sound recordings in some countries and are in danger of losing access to their share in others.
By granting performance rights in sound recordings, the United States will treat the creators of these culturally and economically important copyrighted works the same as all other works capable of being publicly performed. This legislation will provide increased incentive for the creators of sound recordings to produce and disseminate more works, thereby expanding consumer choice. In addition, the enactment of these rights will strengthen the hand of Government negotiators and private advocates seeking a fair share of foreign royalty pools.
Some argue that copyright owners of sound recordings should not be granted a public performance right because they derive some indirect benefit from the public performance of their works. This argument is based on the theory that the public performance of a work increases the sales of reproductions of that work. Therefore, the copyright owner gets an indirect benefit (i.e., increased sales of reproductions) from the so-called "free advertising" that public performances provide. This, in fact, may be true in some cases. However, it is not a valid policy argument against providing sound recording copyright owners with the full panoply of exclusive rights other copyright owners enjoy.
The exercise of one right often increases the value of the exercise of another right, but we do not restrict any other copyright owners from exercising all of his or her rights. For instance:
• The copyright owner of the musical composition embodied in a sound recording is paid both when recordings of the composition are sold and when the composition is publicly performed -- even though the public performance might increase the number of records sold and thus benefit the copyright owner.
• Serial excerpts from a novel that are published in a magazine might increase sales of the book, but the magazine nonetheless must obtain permission from the author of the book.
• The copyright owner of that novel may also increase his book sales when a motion picture based on the novel is released. However, no one suggests that the motion picture company should not have to pay the copyright owner of the novel for the right to turn it into a movie, just because the movie might indirectly benefit the copyright owner.
The copyright owners of sound recordings should be able to decide for themselves, as do all other copyright owners, if "free advertising" is sufficient compensation for the use of their works. If the users' arguments regarding the benefit copyright owners derive from the public performance of their sound recordings are correct, the users should be able to negotiate a very low rate for a license to do so.
It also has been argued that the copyright owners of sound recordings should not be granted the "exclusive" right that all other copyright owners enjoy, but instead be subject to a compulsory license, so that they cannot act as a "gatekeeper" to the licensing of performances of the musical works embodied in sound recordings. It is asserted that while a copyright owner of a sound recording with an exclusive public performance right could block the performance of the musical work by denying a license to publicly perform the sound recording, the copyright owner of the musical work could not. This argument is based on the incorrect assumption that copyright owners of musical works are not granted exclusive public performance rights. Section 106(4) of the Copyright Act clearly grants exclusive rights to the copyright owners of musical works, and, while virtually all music performance licensing is handled for those copyright owners by performing rights societies on a nonexclusive basis, the copyright owners could license their performance rights on an exclusive basis if they chose to do so. [556]
Two bills introduced in the 104th Congress would grant a very limited performance right in sound recordings. [557] A full public performance right -- particularly with respect to all digital transmissions -- is warranted. There is no just reason to afford a lower level of protection to one class of creative artists. Further, any special limitations on this right weakens our position internationally. The digital communications revolution -- the creation of advanced information infrastructures -- is erasing the distinctions among different categories of protected works and the uses made of them.
3. LIBRARY EXEMPTIONS
The copyright law carefully balances the rights of copyright owners with the legitimate needs of users. Nowhere is this balancing more apparent than in the exemptions that are intended to permit libraries reasonable use of copyrighted works to serve the legitimate demands of their patrons.
Many have expressed concern that the special exemptions for libraries in Section 108 of the Copyright Act are no longer relevant in the digital era. Libraries, of course, may make fair use of any copyrighted works pursuant to the provisions of Section 107. [558] Section 108, however, provides additional exemptions specifically for libraries and archives On the one hand, there are those who believe that since licensing of transactions of works in digital form will be a feature of the digital distribution systems of the future, there is no need for library exceptions. Each copying transaction will be cheap and libraries can simply pay for all of the copying in which they engage. On the other hand, there are those who believe that unrestricted copying in libraries should be the rule, without the special conditions and limitations set forth in Section 108.
The Working Group agrees with neither those who would delete the exemptions for library copying nor those who would permit wholesale copying in libraries. It believes that there is an important public interest in exempting certain library uses of copyrighted works and that the public interest is no less important -- and, indeed, may be more important -- when such use involves digital technology. It also believes that there is an equally important interest in recognizing the legitimate interests of copyright owners in licensing uses of their works through voluntary systems.
Therefore, notwithstanding the legislative history of the 1976 Act which clearly intended that Section 108 did not permit digital reproduction, [559] the Working Group believes that it is important to expand the exemption so that digital copying by libraries and archives is permitted under certain circumstances. In supporting this departure from the generally accepted view of the scope and intention of Section 108, the Working Group believes that the law must preserve the role of libraries and archives in the digital era.
Libraries and archives are the trustees of our collective knowledge and must be able to make use of digital technology to preserve the Nation's heritage and scholarship. Therefore, the Working Group recommends that the library exemptions be amended: (1) to accommodate the reality of the computerized library by allowing the preparation of three copies of works in digital form, with no more than one copy in use at any time (while the others are archived); (2) to recognize that the use of a copyright notice on a published copy of a work is no longer mandatory; and (3) to authorize the making of digital copies for purposes of preservation. [560]
4. REPRODUCTION FOR THE VISUALLY IMPAIRED
The NII offers real opportunities to many visually impaired people to participate in learning, communication and discourse to a greater extent than when only conventional modes of communication are available. With the aid of software and computer equipment that is widely available, people now have the capacity to view text on CDROM on screen in a "large-type" format even if the publisher did not include such a feature, but the publication and distribution of large-type editions remains very important. To ensure fair access to all manner of printed materials, it is necessary to amend the copyright law.
The laws of many Berne Convention countries contain express exemptions from liability for the unauthorized manufacture and distribution of Braille or other editions designed to assist the visually impaired. [561] The Working Group believes that similar provisions should be included in the Copyright Act, and has modeled its proposal on the Australian law, so as to maintain private rights while recognizing certain readers' special needs. The proposed amendment would provide an exemption for non-profit organizations to reproduce and distribute to the visually impaired -- at cost -- Braille, large type, audio or other editions of previously published literary works in forms intended to be perceived by the visually impaired, provided that the owner of the exclusive right to distribute the work in the United States has not entered the market for such editions during the first year following first publication of the work. [562]
5. CRIMINAL OFFENSES
Although the Copyright Act provides criminal penalties when the infringement is willful and is for purposes of commercial advantage or private financial gain, [563] the dismissal of the criminal charges in United States v. LaMacchia demonstrates a serious lacuna in the criminal copyright provisions: it does not now reach even the most wanton and malicious large-scale endeavors to copy and provide on the NII limitless numbers of unauthorized copies of valuable copyrighted works unless the copier seeks profits. [564] Since there is virtually no cost to the infringer, certain individuals are willing to make such copies (or assist others in making them) for reasons other than monetary reward. For example, someone who believes that all works should be free in Cyberspace can easily make and distribute thousands of copies of a protected work and may have no desire for commercial advantage or private financial gain.
The Working Group agrees with the LaMacchia court:
Therefore, the Working Group generally supports the amendments to the copyright law and the criminal law (which sets out sanctions for criminal copyright violations) set forth in S. 1122, introduced in the 104th Congress by Senators Leahy and Feingold following consultations with the Justice Department. The bill would make it a criminal offense to willfully infringe a copyright by reproducing or distributing copies with a retail value of $5,000 or more. By setting a monetary threshold and requiring willfulness, the bill ensures that merely casual or careless conduct resulting in distribution of only a few copies will not be subject to criminal prosecution and that criminal charges will not be brought unless there is a significant level of harm to the copyright owner's rights. [565]
6. TECHNOLOGICAL PROTECTION
The ease of infringement and the difficulty of detection and enforcement will cause copyright owners to look to technology, as well as the law, for protection of their works. However, it is clear that technology can be used to defeat any protection that technology may provide. The Working Group finds that legal protection alone will not be adequate to provide incentive to authors to create and to disseminate works to the public. Similarly, technological protection likely will not be effective unless the law also provides some protection for the technological processes and systems used to prevent or restrict unauthorized uses of copyrighted works.
The Working Group finds that prohibition of devices, products, components and services that defeat technological methods of preventing unauthorized use is in the public interest and furthers the Constitutional purpose of copyright laws. Consumers of copyrighted works pay for the acts of infringers; copyright owners have suggested that the price of legitimate copies of copyrighted works may be higher due to infringement losses suffered by copyright owners. The public will also have access to more copyrighted works via the NII if they are not vulnerable to the defeat of protection systems.
Therefore, the Working Group recommends that the Copyright Act be amended to include a new Chapter 12, which would include a provision to prohibit the importation, manufacture or distribution of any device, product or component incorporated into a device or product, or the provision of any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights under Section 106. The provision will not eliminate the risk that protection systems will be defeated, but it will reduce it.
The proposed prohibition is intended to assist copyright owners in the protection of their works.566 The Working Group recognizes, however, that copyright owners may wish to use such systems to prevent the unauthorized reproduction, for instance, of their works, but may also wish to allow some users to deactivate the systems. Furthermore, certain uses of copyrighted works are not unlawful under the Copyright Act. Therefore, the proposed legislation prohibits only those devices or products, the primary purpose or effect of which is to circumvent such systems without authority. That authority may be granted by the copyright owner or by limitations on the copyright owner's rights under the Copyright Act.
It has been suggested that the prohibition is incompatible with fair use. First, the fair use doctrine does not require a copyright owner to allow or to facilitate unauthorized access or use of a work. Otherwise, copyright owners could not withhold works from publication; movie theatres could not charge admission or prevent audio or video recording; museums could not require entry fees or prohibit the taking of photographs. Indeed, if the provision of access and the ability to make fair use of copyrighted works were required of copyright owners -- or an affirmative right of the public -- even passwords for access to computer databases would be considered illegal. Second, if the circumvention device is primarily intended and used for legal purposes, such as fair use, the device would not violate the provision, because a device with such purposes and effects would fall under the "authorized by law" exemption.
Concern has also been expressed with regard to the ability to defeat technological protection for copies of works not protected by copyright law, such as those whose term of protection has expired or those in the public domain for other reasons (such as ineligibility for protection). However, devices whose primary purpose and effect is to defeat the protection for such works would not violate the provision. The proposed provision exempts all devices, products and services primarily intended and used for legal purposes, which would include the reproduction and distribution of copies of works in the public domain. Further, a protection system on copies of works in the public domain would not qualify with respect to such copies as a system which "prevents or inhibits the violation of any of the exclusive rights of the copyright owner under Section 106." Works in the public domain are not protected by copyright, and thus have no copyright owner or exclusive rights applicable to them. Finally, while technological protection may be applied to copies of works in the public domain, such protection attaches only to those particular copies -- not to the underlying work itself. [567]
It has also been suggested that the provision places an unwarranted burden on manufacturers. The proposed amendment would impose no requirement on manufacturers to accommodate any protection systems, such as those required in Chapter 10 of manufacturers of digital audio recording devices. [568] The provision would only prohibit the manufacture of circumvention devices. [569]
Neither does the proposed amendment require copyright owners to use technological protection, or, if they do, to employ any particular type. Copyright owners should be free to determine what level or type of protection (if any) is appropriate for their works, taking into consideration cost and security needs, and different consumer and market preferences. Moreover, there is no evidence that one technological protection system could -- or should -- take care of all types of works.
Legislation of this type is not unprecedented. The Copyright Act already protects sound recordings and musical works by prohibiting the circumvention of any program or circuit that implements a serial copy management system or similar system included in digital audio recording devices and digital audio interface devices. Section 1002 provides:
The Communications Act includes a similar provision:
Precedent for this type of legislation is also found in the international arena. The NAFTA requires each party to make it a criminal offense to "manufacture, import, sell, lease or otherwise make available a device or system that is primarily of assistance in decoding an encrypted programcarrying satellite signal without the authorization of the lawful distributor of such signal . . . ."572 In 1988, the United Kingdom enacted legislation prohibiting the manufacture, distribution or sale of a device designed or adapted to circumvent copy-protection systems. [573]
7. COPYRIGHT MANAGEMENT INFORMATION
In the future, the copyright management information associated with a work -- such as the name of the copyright owner and the terms and conditions for uses of the work -- may be critical to the efficient operation and success of the NII. Copyright management information will serve as a kind of license plate for a work on the information superhighway, from which a user may obtain important information about the work. The accuracy of such information will be crucial to the ability of consumers to find and make authorized uses of copyrighted works on the NII. Reliable information will also facilitate efficient licensing and reduce transaction costs for licensable uses of copyrighted works (both fee-based and royalty-free).
The public should be protected from false information about who created the work, who owns rights in it, and what uses may be authorized by the copyright owner. Therefore, the Working Group recommends that the Copyright Act be amended to prohibit the provision, distribution or importation for distribution of copyright management information known to be false and the unauthorized removal or alteration of copyright management information. Under the proposed amendment, copyright management information is defined as the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation -- to provide adequate flexibility in the future. [574]
While the proposed amendment does not require copyright owners to provide copyright management information, it does require that when such information is included, it be accurate. However, the Working Group encourages copyright owners to include the information to enable consumers to more easily find and make authorized uses of copyrighted works. Nor does it specify standardized formats or content, although private sector initiatives in this area are underway and are also encouraged by the Working Group. Finally, it does not require transmitting entities to include the copyright information as part of their transmission of a work where such information has been included in the work. [575] However, such a proposal deserves further consideration.
The proposal prohibits the falsification, alteration or removal of any copyright management information -- not just that which is included in or digitally linked to the copyrighted work. Many users will obtain such information from public registers, where the integrity of such information will be no less important. The proposal also contains a knowledge requirement; therefore, inadvertent falsification, alteration or removal would not be a violation. [576]
B. PATENT
The present law governing the eligibility of inventions for patent protection and the enforcement of patent rights appears adequate to address the needs of inventors and the public with regard to technology used on the NII. The NII will increase the accessibility and content of the body of prior art, which in turn will affect patentability determinations. The law governing information that properly is considered part of the prior art appears to be adequate to address new forms of "printed" publications; however, some issues related to the authenticity, including the date of origination, the contents as originally disclosed, and the extent of dissemination of electronically disseminated publications, deserve further study.
The Working Group recommends that the Patent and Trademark Office obtain public input related to measures that can be adopted to ensure the authenticity of electronically-disseminated publications, particularly with respect to verifying the contents and date of first public dissemination of the publication, and evaluating the substantive value of the information contained in the publication as to its role in patentability determinations.
The Working Group also recommends that the PTO explore the feasibility of establishing requirements or standards that would govern authentication of the date and contents of electronically-disseminated information for purposes of establishing their use as prior art. Such standards would assist in patentability determinations, whether they occur before the PTO or before a court. To develop such standards, the PTO should invite public comment and work with other interested Federal agencies working on authentication standards outside the direct sphere of the patent system.
C. TRADEMARK
The Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks must be sufficiently flexible to accommodate the changing goods and services available in connection with the NII and the GII. Such flexibility is essential to the owners of marks identifying goods and services connected with the NII and the GII, as well as to the continued viability of the International Classification system in the electronic information age. Therefore, the Working Group recommends that the Patent and Trademark Office, in the context of WIPO experts meetings on the International Classification system, propose changes to the International Classification system to ensure that the system reflects the goods and services of modern information technology. Additionally, the Working Group recommends that the Patent and Trademark Office regularly update its Manual for the Identification of Goods and Services to reflect new goods and services used on or in connection with the NII and GII.
_______________
Notes:
529. H.R. REP. NO. 101-735, 101st Cong., 2d Sess. 7 (1990), reprinted in 1990 U.S.C.C.A.N. 6935, 6938 (report accompanying legislation granting copyright owners of computer software an exclusive rental right).
530. Sony, supra note 361, at 430-31.
531. See discussion of the Constitutional purpose of copyright supra pp. 19-23.
532. Sony, supra note 361, at 431.
533. See supra p. 13.
534. See discussion supra pp. 70-73.
535. In contrast, a "standard" distribution of a copy necessarily divests the distributor of his copy. In the case of a distribution by transmission, the distributor generally retains his copy of the work and a reproduction is distributed.
536. It has been suggested that recognition of distribution by transmission may diminish the public performance right. However, if a work is publicly performed by transmission, then there has been a public performance -- whether or not the distribution right is or is not also involved. The fact that some transmissions may constitute a reproduction and distribution of copies to the public does not mean that transmissions that constitute public performances are not public performances. The scope of the public performance right is not diminished by the recognition that a transmission may fall within the scope of the distribution right. If a copy of a motion picture is transmitted to a computer's memory, for instance, and in the process, the sounds are capable of being heard and the images viewed as they are received in memory, then the public performance right may well be implicated as well. See 17 U.S.C. § 101 (1988) (definition of "perform").
537. The exclusive rights, "which comprise the so-called 'bundle of rights' that is a copyright, are cumulative and may overlap in some cases. Each of the five enumerated rights may be subdivided indefinitely, and . . . each subdivision of an exclusive right may be owned and enforced separately." HOUSE REPORT at 61, reprinted in 1976 U.S.C.C.A.N. 5674.
538. See discussion supra pp. 45-47.
539. HOUSE REPORT at 61, reprinted in 1976 U.S.C.C.A.N. 5674.
540. See discussion supra pp. 28-32. The term "public" as used in connection with the distribution right is not coincident with the meaning assigned to that term in connection with the public performance or public display right.
541. If copies of works are offered to the public -- even though they may be distributed one copy at a time -- it would likely constitute distribution to the public. See 17 U.S.C. § 101 (1988) (definition of "publication"); 1 NIMMER ON COPYRIGHT § 4.04 at 4-20.
542. In the future, transmission may become the conventional means of distribution.
543. Under the proposed definition, to transmit a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent.
544. To delineate between those transmissions that are communications of performances or displays and those that are distributions of reproductions, one may look at both ends of the transmission. Did the transmitter intend to communicate a performance or display of the work or, rather, to distribute a reproduction of the work? Did the receiver simply hear or see the work or rather/also receive a copy of it? Did the receiver simply receive a copy or was it possible for her to hear or see it as well? License rates and terms will assist in determining the intent of the parties.
545. See HOUSE REPORT at 138 (emphasis added), reprinted in 1976 U.S.C.C.A.N. 5754.
546. See discussion supra pp. 28-32. The House Report also states, however, that the definition was intended to clarify that the offering of copies or phonorecords to a group of, for instance, wholesalers, broadcasters or motion picture theater operators constitutes publication if the purpose of the offering is "further distribution, public performance, or display." See HOUSE REPORT at 138, reprinted in 1976 U.S.C.C.A.N. 5754. Therefore, if an author offers copies to bulletin board system operators or others for further distribution, public performance or public display on a computer network, publication may occur.
547. Under the current law, the distribution right is identified as the right "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." See 17 U.S.C. § 106(3) (1988). Publication is "the distribution of copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." See 17 U.S.C. § 101 (1988) (part of definition of "publication").
548. Under the law of the United Kingdom, making a work available to the public by means of an electronic retrieval system constitutes publication. See Copyright, Designs and Patents Act of 1988, § 175(1)(b).
549. See supra notes 68-83 and accompanying text.
550. In the print domain, prior published editions are more easily and generally available for reference, partially because of the deposit requirement, but primarily because subsequent versions do not override the originals -- which is possible in the on-line environment.
551. See discussion supra pp. 28-32.
552. See discussion of the doctrine of limited publication supra pp. 31-32.
553. See White v. Kimmell, 193 F.2d 744 (9th Cir. 1952) (unrestricted circulation of 200 copies of a manuscript to friends and acquaintances published the work); Continental Casualty Co. v. Beardsley, 253 F.2d 702 (2d Cir. 1958) (distribution of approximately 100 sets of forms to corporate officers and surety companies for possible purchase of more constituted publication).
554. See discussion of the importation right supra pp. 107-09.
555. Some transmissions that clearly constitute public performances may, in effect, substitute for distributions in the future. If consumers are offered a service through which they can receive a performance of any sound recording at any time, they may stop buying phonorecords. The market for distributed phonorecords may shrink to include only the providers of that service to consumers.
556. If the copyright owners of sound recordings abused the exclusivity that the law should provide, the solution would lie in the enforcement of the antitrust laws -- where the music licensing problems have been addressed -- not in the reduction of rights under the Copyright Act.
557. See S. 227, 104th Cong., 1st Sess. (1995); H.R. 1506, 104th Cong., 1st Sess. (1995).
558. See discussion supra pp. 73-82.
559. The legislative history makes it clear that digital uses are generally not encompassed by Section 108: "Under this exemption, for example, a repository could make photocopies of manuscripts by microfilm or electrostatic process, but could not reproduce the work in 'machine-readable' language for storage in an information system." HOUSE REPORT at 75, reprinted in 1976 U.S.C.C.A.N. 5689; Senate Report at 67 (emphasis added). The Senate Report also speaks precisely of "the photocopying needs of . . . multi-county regional systems." Id. at 70 (emphasis added).
560. The Working Group believes that replacement copies may be digital in nature, and may be made under this provision only when an unused replacement is not available in either digital or analog form.
561. See, e.g., Section 53D of the Australian law (privilege conditioned on copyright owner's abstention from market for Braille edition); Section 18 of the Finnish law (Braille editions and talking books may be manufactured "for use by lending libraries for blind persons"); Section 80 of the Portuguese law (Braille editions may be manufactured if not for profit).
562. The visually impaired were the only users with a disability who provided comments or testimony concerning a need for a narrow exemption to ensure the availability of literary works in a usable form. By its recommendation of such an exemption for the visually impaired, the Working Group does not intend to dismiss the possibility that other disabled users may have needs of which it has not been made aware and, therefore, has not considered.
563. See discussion of criminal offenses supra pp. 126-28.
564. See discussion of the LaMacchia case supra p. 127.
565. As noted earlier, the idea/expression dichotomy and the limitations on the exclusive rights, including fair use, address First Amendment concerns. See supra pp. 32-35, 73-100 and note 227. See also Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 560 (1985) ("First Amendment protections [are] embodied in the [Copyright] Act's distinction between copyrightable expression and uncopyrightable facts and ideas, and the latitude for scholarship and comment traditionally afforded by fair use").
566. Legislation of a similar type has been introduced with respect to technological protection of audiovisual works. See, e.g., S. 1096, 102d Cong., 1st Sess., 137 Cong. Rec. S. 6034 (1991); H.R. 3568, 101st Cong., 1st Sess., 135 Cong. Rec. H. 7924 (1989).
567. Copies of the work in the marketplace free from copyright protection could be freely reproduced (and, in fact, the lower distribution costs of the NII may encourage increased availability of public domain works). Further, technological protection that restricts the ability to reproduce the work by technical means does not prevent reproduction by other means (such as quoting, manually copying, etc.).
568. However, the Working Group does encourage the equipment manufacturing and copyright industries to work together on bilateral solutions for other types of recording devices and categories of works. In response to a request from Congressional leaders, representatives of the motion picture industry and the consumer electronics industry are presently drafting a joint legislative proposal addressing legal and technical measures pertaining to consumer recording of motion pictures. This proposal would set forth a technical means to be applied that would respect the legitimate commercial expectations of copyright owners and the reasonable and customary copying practices of consumers.
569. Some have suggested that while manufacturers will surely know the primary purpose of the devices they produce, they may inadvertently find themselves liable for devices which they intended for legal purposes, but which have the incidental effect of circumventing copyright protection systems. For a manufacturer to find himself in this situation, the device would have to fail to be used primarily for the purpose for which it was sold, and be primarily used, to the surprise of its manufacturer, for defeating protection systems. It is likely that such a situation would occur rarely, if ever. (It would be self-defeating for copyright owners to begin using a protection system that an existing device could defeat.) However, the chapter contains an "innocent violation" provision for just such a case. A court would have the ability to reduce or eliminate altogether any damages for which the manufacturer would otherwise be liable, to avoid an unfair result but still protect the copyright owner.
570. 17 U.S.C. § 1002(c) (Supp. V 1993).
571. 47 U.S.C. § 605(e)(4) (1988).
572. See NAFTA, supra note 446, at art. 1707(a). The NAFTA also requires parties to make it a civil offense to "receive, in connection with commercial activities, or further distribute, an encrypted program-carrying satellite signal that has been decoded without the authorization of the lawful distributor of the signal or to engage in any activity prohibited under [the criminal provisions]." See NAFTA, supra note 446, at art. 1707(b).
573. See Copyright, Designs and Patents Act of 1988, Part VII, § 296.
574. Other information that may become important to the efficient operation of the NII includes the country of origin of the work, the year of creation or first publication, a description of the work, the name and other identifying information of licensees and standardized codes.
575. While a transmitting entity may not remove the copyright management information, if such information is not included in the normal course of the transmission (such as when a work in digital form is broadcast through analog transmission), no violation would occur.
576. For criminal liability, both knowledge and the intent to defraud are required.
A. COPYRIGHT
It is difficult for intellectual property laws to keep pace with technology. When technological advances cause ambiguity in the law, courts look to the law's underlying purposes to resolve that ambiguity. However, when technology gets too far ahead of the law, and it becomes difficult and awkward to adapt the specific statutory provisions to comport with the law's principles, it is time for reevaluation and change. "Even though the 1976 Copyright Act was carefully drafted to be flexible enough to be applied to future innovations, technology has a habit of outstripping even the most flexible statutes." [529]
From its beginning, the law of Copyright has developed in response to significant changes in technology. Indeed, it was the invention of a new form of copying equipment -- the printing press -- that gave rise to the original need for copyright protection. Repeatedly, as new developments have occurred in this country, it has been the Congress that has fashioned the new rules that new technology made necessary. [530]
The Working Group has examined the adequacy of the Copyright Act to cope with the pace of technological changes. In applying the law to new uses, media and technology, the issues presented vary. Certain issues merely require an explanation of the application of the current law, and clearly are appropriately covered. Others present rights or limitations that clearly fit within the spirit of the law but the letter of the law is in need of clarification to avoid uncertainty and unnecessary litigation. Still others need new solutions. Technology has altered the balance of the Copyright Act -- in some instances, in favor of copyright owners and in others, in favor of users. The goal of these recommendations is to accommodate and adapt the law to technological change so that the intended balance is maintained and the Constitutional purpose is served. [531]
While it is not advisable to propose amendment of the law with every technological step forward, neither is it appropriate to blindly cling to the status quo when the market has been altered.
Sound policy, as well as history, supports our consistent deference to Congress when major technological innovations alter the market for copyrighted materials. Congress has the constitutional authority and the institutional ability to accommodate fully the varied permutations of competing interests that are inevitably implicated by such new technology. [532]
Throughout more than 200 years of history, with periodic amendment, United States law has provided the necessary copyright protection for the betterment of our society. The Copyright Act is fundamentally adequate and effective. In a few areas, however, it needs to be amended to take proper account of the current technology. The coat is getting a little tight. [533] There is no need for a new one, but the old one needs a few alterations.
1. THE TRANSMISSION OF COPIES AND PHONORECORDS
a. THE DISTRIBUTION RIGHT
The Copyright Act gives a copyright owner the exclusive right "to distribute copies or phonorecords of the copyrighted work" to the public. It is not clear under the current law that a transmission can constitute a distribution of copies or phonorecords of a work. [534] Yet, in the world of high-speed, communications systems, it is possible to transmit a copy of a work from one location to another. This may be the case, for instance, when a computer program is transmitted from one computer to ten other computers. When the transmission is complete, the original copy typically remains in the transmitting computer and a copy resides in the memory of, or in storage devices associated with, each of the other computers. [535] The transmission results essentially in the distribution of ten copies of the work. However, the extent of the distribution right under the present law may be somewhat uncertain and subject to challenge. Therefore, the Working Group recommends that the Copyright Act be amended to expressly recognize that copies or phonorecords of works can be distributed to the public by transmission, and that such transmissions fall within the exclusive distribution right of the copyright owner.
The proposed amendment does not create a new right. It is an express recognition that, as a result of technological developments, the distribution right can be exercised by means of transmission -- just as the reproduction, public performance and public display rights may be. [536]
It is argued by some that the existing right of distribution encompasses transmissions of copies and that no amendment is necessary. Indeed, the distribution right, as set forth in Section 106(3) of the Copyright Act, can be -- and, in at least one case, has been -- interpreted to include transmissions which distribute copies of works to, for example, the memories of computers. Transmission, it is argued, is logically and legally a means of distribution. The Working Group has no argument with such an interpretation; it properly conforms to the intent of the distribution right and, we believe, is correct from both a practical and legal standpoint.
Others suggest that amendment of the law may not be necessary because even if the distribution right does not cover the distribution of reproductions by transmission, the reproduction right is clearly implicated and that will protect the copyright owner. However, the fact that more than one right may be involved in infringing activity does not, and should not, mean that only one right should apply. [537] Each of the exclusive rights is distinct and separately alienable and different parties may be responsible for infringements or licensing of different rights -- and different rights may be owned by different people. [538] Because transmissions of copies may constitute both a reproduction and a distribution of a work, transmissions of copies should not constitute the exercise of just one of those rights. Indeed, those licensed only to reproduce a work should not be entitled to also distribute the work through transmission -- thereby displacing the market for the copyright owner or his distribution licensee.
Infringement takes place when any one of the rights is violated: where, for example, a printer reproduces copies without selling them or a retailer sells copies without having anything to do with their reproduction. [539]
Clearly, not all transmissions of copies of copyrighted works will fall within the copyright owner's exclusive distribution right. Moreover, even if a transmission of a copy falls within the scope of the right, it is not necessarily unlawful. First, the distribution must be a distribution to the public. The case law interpreting "publication" provides guidance as to what constitutes distribution to the public. [540] If a distribution would not constitute a publication of the work, then it would likely be found to be outside the scope of the copyright owner's distribution right. Therefore, the transmission of a copyrighted work from one person to another in a private e-mail message would not constitute a distribution to the public. [541] Second, all of the limitations, exemptions and defenses that currently apply to the distribution right and allow users to distribute certain copies to the public or to distribute copies under certain circumstances will continue to apply. For example, any exercise of one of the exclusive rights may be fair use -- including the reproduction and distribution of copies by transmission.
Some are of the view that the current language of the Act does not encompass distribution by transmission. They argue that the proposed amendment expands the copyright owner's rights without a concomitant expansion of the limitations on those rights. However, since transmissions of copies already clearly implicate the reproduction right, it is misleading to suggest that the proposed amendment of the distribution right would expand the copyright owner's rights into an arena previously unprotected. Further, even if the premise is correct (that the amendment expands the distribution right), the conclusion that the limitations of that right are not similarly expanded is invalid. The limitations on the right -- which place certain distributions to the public outside the scope of the copyright owner's right -- would necessarily expand to also place similar distributions by means of transmission outside the scope of the right.
Nevertheless, there is no reason to treat works that are distributed in copies to the public by means of transmission differently than works distributed in copies to the public by other, more conventional means. [542] Copies distributed via transmission are as tangible as any distributed over the counter or through the mail. Through each method of distribution, the consumer receives a tangible copy of the work.
When the public performance right was initially granted, it was thought to encompass only "live," in-person performances. When it became clear that copyrighted works could be publicly performed by other means -- i.e., broadcast and, later, cable transmissions -- the law was clarified. The same is true today with respect to the distribution right. Transmission is a means of distribution of copies, just as it can be a means of performance. However, the differences of opinion summarized above underscore the need for clarification and legal certainty. The costs and risks of litigation to define more clearly the right -- and the time achieving such clarity would take -- would discourage and delay use of the NII.
b. RELATED DEFINITIONAL AMENDMENTS
The Working Group also recommends other related amendments to two definitions.
TO "TRANSMIT"
As explained above, under current technology, a copy of a work may be transmitted. However, the Copyright Act defines only what it is to transmit a performance or display of a work. Therefore, the Working Group recommends that the definition of "transmit" in Section 101 of the Copyright Act be amended to include a definition of a transmission of a reproduction. [543]
How to delineate between these types of transmissions is a difficult issue to resolve. The transmissions themselves hold no clues; one type often looks the same as the other during the transmission. If the transmitter intends to transmit a performance of the work, as well as to distribute a reproduction of it -- or if the receiver is able to hear or see a performance of the work in the course of receiving a copy of it -- what rights are exercised by the transmission? A transmission could be a transmission of a reproduction or a performance or both. The resolution of these issues should rest upon the specific facts of the case. Such issues will typically be clarified between rightsholders and users in appropriate license arrangements. If confusion or disagreement exists in a specific context, the courts -- rather than Congress -- are in the better position to determine which, if any, exclusive rights are involved in a particular transmission. Courts regularly make such determinations in other cases where rights overlap. [544]
"PUBLICATION"
The legislative history of the Copyright Act makes clear that "any form of dissemination in which a material object does not change hands . . . is not a publication no matter how many people are exposed to the work." [545] Thus, a work that is only displayed or performed via the NII would not be considered published, no matter how many people have access to the display or performance, because a material object -- a copy of the work -- does not change hands. [546] However, in the case of transmissions of reproductions, the recipients of the transmissions receive copies of the work (i.e., copies of the work have been distributed) -- although they may not have "changed hands" in the literal sense.
Whether the transmission of copies of works is clearly within the scope of the distribution right is also a problem with respect to the act of publication by the transmission of copies. Indeed, the definition of "publication" incorporates the language used to describe the distribution right, which the Working Group's proposal amends. [547] Publication largely turns on whether the work has been distributed to the public. Thus, if copies of a work may be distributed to the public by transmission, then a work may be published by the transmission of copies to the public. Therefore, consistent with the proposed amendment of the distribution right, the Working Group recommends that the definition of "publication" in Section 101 of the Copyright Act be amended to recognize that a work may be published through the distribution of copies of the work to the public by transmission. [548]
The effects under the law of a work being considered published (rather than unpublished) generally are negative from the viewpoint of the copyright owner. Published works, for example: (1) must be deposited in the Library of Congress; (2) are subject to more limitations on the exclusive rights, including a broader application of fair use; (3) must meet certain author nationality or domicile requirements to be eligible for protection; and (4) must bear a copyright notice if published before March 1, 1989.549 However, the designation of works distributed to the public by transmission as published will be important in the case of works distributed first -- or solely -- on-line. The deposit requirement will aid in the preservation of those works, which otherwise might be updated or revised on-line, destroying -- or at least obscuring -- the original published versions. This may be particularly critical in preserving the scholarly and scientific record. [550]
Just as not all distributions of copies by transmission will constitute distributions to the public (and fall within the distribution right), not all transmissions of copies will constitute publication. Private e-mail messages would not be regarded as published. [551] Neither would other restricted transmissions of copies, such as those in a typical corporate setting, where transmissions of copies within the company computer network are restricted as to further distribution. [552] However, as in the print environment, the distribution of copies to a small group under circumstances where further distribution is authorized would publish the work. [553]
c. THE IMPORTATION PROVISIONS
The Working Group also recommends that the prohibitions on importation be amended to reflect the fact that, just as copies of copyrighted works can be distributed by transmission in the United States, they can also be imported into the U.S. by transmission. If an infringing literary work, for instance, were physically shipped into the U.S. in the form of a paper copy, a CD-ROM disk or even stored on a memory chip, then it would be an infringing importation if the statutory conditions existed. [554]
Cross-border transmission of copies of copyrighted works should be subject to the same restrictions as shipping them by airmail. Just as the distribution of copies of a copyrighted work is no less a distribution than the distribution of copies by mail, the international transmission of copies of copyrighted works is no less an importation than the importation by airmail.
Although we recognize that the U.S. Customs Service cannot, for all practical purposes, enforce a prohibition on importation by transmission, given the global dimensions of the information infrastructure of the future, it is important that copyright owners have the other remedies for infringements of this type available to them. Therefore, the Working Group recommends that Section 602 of the Copyright Act be amended to include importation by carriage or shipping of copies as well as by transmission of them.
2. PUBLIC PERFORMANCE RIGHT FOR SOUND RECORDINGS
Transmissions of sound recordings will certainly supplement and may eventually replace the current forms of distribution of phonorecords. In the very near future, consumers will be able to receive digital transmissions of sound recordings on demand -- for performance in the home or for downloading -- from the so-called "celestial jukebox." The legal nature of such transmissions -- whether they are performances or distributions -- has been widely debated. As discussed above, the Working Group recommends that Section 106 of the Copyright Act be amended to make clear that copies or phonorecords can be distributed by transmission. However, many of these transmissions will clearly constitute exercise of the public performance right -- a right which the Copyright Act fails to grant to copyright owners of sound recordings. [555]
The lack of a public performance right in sound recordings under U.S. law is an historical anomaly that does not have a strong policy justification -- and certainly not a legal one. Sound recordings are the only copyrighted works that are capable of being performed that are not granted that right. Therefore, for example, to transmit a performance of a sound recording without infringement liability, an audio-on-demand service acting as a "celestial jukebox" must obtain a license from, and pay a royalty to, the copyright owner of the underlying musical work (i.e., the person or entity who owns the rights in the notes and the lyrics), but it does not have to obtain permission from, or pay a license fee to, the copyright owner of the sound recording or the performer. The Working Group believes that this inequity should be rectified.
Public performance rights are granted in many foreign markets. Due to the lack of a performance right in the United States, U.S. performers and record companies are denied their fair share of foreign royalty pools for the public performance of U.S. sound recordings in some countries and are in danger of losing access to their share in others.
By granting performance rights in sound recordings, the United States will treat the creators of these culturally and economically important copyrighted works the same as all other works capable of being publicly performed. This legislation will provide increased incentive for the creators of sound recordings to produce and disseminate more works, thereby expanding consumer choice. In addition, the enactment of these rights will strengthen the hand of Government negotiators and private advocates seeking a fair share of foreign royalty pools.
Some argue that copyright owners of sound recordings should not be granted a public performance right because they derive some indirect benefit from the public performance of their works. This argument is based on the theory that the public performance of a work increases the sales of reproductions of that work. Therefore, the copyright owner gets an indirect benefit (i.e., increased sales of reproductions) from the so-called "free advertising" that public performances provide. This, in fact, may be true in some cases. However, it is not a valid policy argument against providing sound recording copyright owners with the full panoply of exclusive rights other copyright owners enjoy.
The exercise of one right often increases the value of the exercise of another right, but we do not restrict any other copyright owners from exercising all of his or her rights. For instance:
• The copyright owner of the musical composition embodied in a sound recording is paid both when recordings of the composition are sold and when the composition is publicly performed -- even though the public performance might increase the number of records sold and thus benefit the copyright owner.
• Serial excerpts from a novel that are published in a magazine might increase sales of the book, but the magazine nonetheless must obtain permission from the author of the book.
• The copyright owner of that novel may also increase his book sales when a motion picture based on the novel is released. However, no one suggests that the motion picture company should not have to pay the copyright owner of the novel for the right to turn it into a movie, just because the movie might indirectly benefit the copyright owner.
The copyright owners of sound recordings should be able to decide for themselves, as do all other copyright owners, if "free advertising" is sufficient compensation for the use of their works. If the users' arguments regarding the benefit copyright owners derive from the public performance of their sound recordings are correct, the users should be able to negotiate a very low rate for a license to do so.
It also has been argued that the copyright owners of sound recordings should not be granted the "exclusive" right that all other copyright owners enjoy, but instead be subject to a compulsory license, so that they cannot act as a "gatekeeper" to the licensing of performances of the musical works embodied in sound recordings. It is asserted that while a copyright owner of a sound recording with an exclusive public performance right could block the performance of the musical work by denying a license to publicly perform the sound recording, the copyright owner of the musical work could not. This argument is based on the incorrect assumption that copyright owners of musical works are not granted exclusive public performance rights. Section 106(4) of the Copyright Act clearly grants exclusive rights to the copyright owners of musical works, and, while virtually all music performance licensing is handled for those copyright owners by performing rights societies on a nonexclusive basis, the copyright owners could license their performance rights on an exclusive basis if they chose to do so. [556]
Two bills introduced in the 104th Congress would grant a very limited performance right in sound recordings. [557] A full public performance right -- particularly with respect to all digital transmissions -- is warranted. There is no just reason to afford a lower level of protection to one class of creative artists. Further, any special limitations on this right weakens our position internationally. The digital communications revolution -- the creation of advanced information infrastructures -- is erasing the distinctions among different categories of protected works and the uses made of them.
3. LIBRARY EXEMPTIONS
The copyright law carefully balances the rights of copyright owners with the legitimate needs of users. Nowhere is this balancing more apparent than in the exemptions that are intended to permit libraries reasonable use of copyrighted works to serve the legitimate demands of their patrons.
Many have expressed concern that the special exemptions for libraries in Section 108 of the Copyright Act are no longer relevant in the digital era. Libraries, of course, may make fair use of any copyrighted works pursuant to the provisions of Section 107. [558] Section 108, however, provides additional exemptions specifically for libraries and archives On the one hand, there are those who believe that since licensing of transactions of works in digital form will be a feature of the digital distribution systems of the future, there is no need for library exceptions. Each copying transaction will be cheap and libraries can simply pay for all of the copying in which they engage. On the other hand, there are those who believe that unrestricted copying in libraries should be the rule, without the special conditions and limitations set forth in Section 108.
The Working Group agrees with neither those who would delete the exemptions for library copying nor those who would permit wholesale copying in libraries. It believes that there is an important public interest in exempting certain library uses of copyrighted works and that the public interest is no less important -- and, indeed, may be more important -- when such use involves digital technology. It also believes that there is an equally important interest in recognizing the legitimate interests of copyright owners in licensing uses of their works through voluntary systems.
Therefore, notwithstanding the legislative history of the 1976 Act which clearly intended that Section 108 did not permit digital reproduction, [559] the Working Group believes that it is important to expand the exemption so that digital copying by libraries and archives is permitted under certain circumstances. In supporting this departure from the generally accepted view of the scope and intention of Section 108, the Working Group believes that the law must preserve the role of libraries and archives in the digital era.
Libraries and archives are the trustees of our collective knowledge and must be able to make use of digital technology to preserve the Nation's heritage and scholarship. Therefore, the Working Group recommends that the library exemptions be amended: (1) to accommodate the reality of the computerized library by allowing the preparation of three copies of works in digital form, with no more than one copy in use at any time (while the others are archived); (2) to recognize that the use of a copyright notice on a published copy of a work is no longer mandatory; and (3) to authorize the making of digital copies for purposes of preservation. [560]
4. REPRODUCTION FOR THE VISUALLY IMPAIRED
The NII offers real opportunities to many visually impaired people to participate in learning, communication and discourse to a greater extent than when only conventional modes of communication are available. With the aid of software and computer equipment that is widely available, people now have the capacity to view text on CDROM on screen in a "large-type" format even if the publisher did not include such a feature, but the publication and distribution of large-type editions remains very important. To ensure fair access to all manner of printed materials, it is necessary to amend the copyright law.
The laws of many Berne Convention countries contain express exemptions from liability for the unauthorized manufacture and distribution of Braille or other editions designed to assist the visually impaired. [561] The Working Group believes that similar provisions should be included in the Copyright Act, and has modeled its proposal on the Australian law, so as to maintain private rights while recognizing certain readers' special needs. The proposed amendment would provide an exemption for non-profit organizations to reproduce and distribute to the visually impaired -- at cost -- Braille, large type, audio or other editions of previously published literary works in forms intended to be perceived by the visually impaired, provided that the owner of the exclusive right to distribute the work in the United States has not entered the market for such editions during the first year following first publication of the work. [562]
5. CRIMINAL OFFENSES
Although the Copyright Act provides criminal penalties when the infringement is willful and is for purposes of commercial advantage or private financial gain, [563] the dismissal of the criminal charges in United States v. LaMacchia demonstrates a serious lacuna in the criminal copyright provisions: it does not now reach even the most wanton and malicious large-scale endeavors to copy and provide on the NII limitless numbers of unauthorized copies of valuable copyrighted works unless the copier seeks profits. [564] Since there is virtually no cost to the infringer, certain individuals are willing to make such copies (or assist others in making them) for reasons other than monetary reward. For example, someone who believes that all works should be free in Cyberspace can easily make and distribute thousands of copies of a protected work and may have no desire for commercial advantage or private financial gain.
The Working Group agrees with the LaMacchia court:
Criminal as well as civil penalties should probably attach to willful, multiple infringements of copyrighted software even absent a commercial motive on the part of the infringer. One could envision ways that the copyright law could be modified to permit such prosecution. But, "[i]t is the legislature, not the Court which is to define a crime, and ordain its punishment."
Therefore, the Working Group generally supports the amendments to the copyright law and the criminal law (which sets out sanctions for criminal copyright violations) set forth in S. 1122, introduced in the 104th Congress by Senators Leahy and Feingold following consultations with the Justice Department. The bill would make it a criminal offense to willfully infringe a copyright by reproducing or distributing copies with a retail value of $5,000 or more. By setting a monetary threshold and requiring willfulness, the bill ensures that merely casual or careless conduct resulting in distribution of only a few copies will not be subject to criminal prosecution and that criminal charges will not be brought unless there is a significant level of harm to the copyright owner's rights. [565]
6. TECHNOLOGICAL PROTECTION
The ease of infringement and the difficulty of detection and enforcement will cause copyright owners to look to technology, as well as the law, for protection of their works. However, it is clear that technology can be used to defeat any protection that technology may provide. The Working Group finds that legal protection alone will not be adequate to provide incentive to authors to create and to disseminate works to the public. Similarly, technological protection likely will not be effective unless the law also provides some protection for the technological processes and systems used to prevent or restrict unauthorized uses of copyrighted works.
The Working Group finds that prohibition of devices, products, components and services that defeat technological methods of preventing unauthorized use is in the public interest and furthers the Constitutional purpose of copyright laws. Consumers of copyrighted works pay for the acts of infringers; copyright owners have suggested that the price of legitimate copies of copyrighted works may be higher due to infringement losses suffered by copyright owners. The public will also have access to more copyrighted works via the NII if they are not vulnerable to the defeat of protection systems.
Therefore, the Working Group recommends that the Copyright Act be amended to include a new Chapter 12, which would include a provision to prohibit the importation, manufacture or distribution of any device, product or component incorporated into a device or product, or the provision of any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights under Section 106. The provision will not eliminate the risk that protection systems will be defeated, but it will reduce it.
The proposed prohibition is intended to assist copyright owners in the protection of their works.566 The Working Group recognizes, however, that copyright owners may wish to use such systems to prevent the unauthorized reproduction, for instance, of their works, but may also wish to allow some users to deactivate the systems. Furthermore, certain uses of copyrighted works are not unlawful under the Copyright Act. Therefore, the proposed legislation prohibits only those devices or products, the primary purpose or effect of which is to circumvent such systems without authority. That authority may be granted by the copyright owner or by limitations on the copyright owner's rights under the Copyright Act.
It has been suggested that the prohibition is incompatible with fair use. First, the fair use doctrine does not require a copyright owner to allow or to facilitate unauthorized access or use of a work. Otherwise, copyright owners could not withhold works from publication; movie theatres could not charge admission or prevent audio or video recording; museums could not require entry fees or prohibit the taking of photographs. Indeed, if the provision of access and the ability to make fair use of copyrighted works were required of copyright owners -- or an affirmative right of the public -- even passwords for access to computer databases would be considered illegal. Second, if the circumvention device is primarily intended and used for legal purposes, such as fair use, the device would not violate the provision, because a device with such purposes and effects would fall under the "authorized by law" exemption.
Concern has also been expressed with regard to the ability to defeat technological protection for copies of works not protected by copyright law, such as those whose term of protection has expired or those in the public domain for other reasons (such as ineligibility for protection). However, devices whose primary purpose and effect is to defeat the protection for such works would not violate the provision. The proposed provision exempts all devices, products and services primarily intended and used for legal purposes, which would include the reproduction and distribution of copies of works in the public domain. Further, a protection system on copies of works in the public domain would not qualify with respect to such copies as a system which "prevents or inhibits the violation of any of the exclusive rights of the copyright owner under Section 106." Works in the public domain are not protected by copyright, and thus have no copyright owner or exclusive rights applicable to them. Finally, while technological protection may be applied to copies of works in the public domain, such protection attaches only to those particular copies -- not to the underlying work itself. [567]
It has also been suggested that the provision places an unwarranted burden on manufacturers. The proposed amendment would impose no requirement on manufacturers to accommodate any protection systems, such as those required in Chapter 10 of manufacturers of digital audio recording devices. [568] The provision would only prohibit the manufacture of circumvention devices. [569]
Neither does the proposed amendment require copyright owners to use technological protection, or, if they do, to employ any particular type. Copyright owners should be free to determine what level or type of protection (if any) is appropriate for their works, taking into consideration cost and security needs, and different consumer and market preferences. Moreover, there is no evidence that one technological protection system could -- or should -- take care of all types of works.
Legislation of this type is not unprecedented. The Copyright Act already protects sound recordings and musical works by prohibiting the circumvention of any program or circuit that implements a serial copy management system or similar system included in digital audio recording devices and digital audio interface devices. Section 1002 provides:
No person shall import, manufacture, or distribute any device, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent any program or circuit which implements, in whole or in part, a [serial copy management system or similar system]. [570]
The Communications Act includes a similar provision:
Any person who manufactures, assembles, modifies, imports, exports, sells, or distributes any electronic, mechanical, or other device or equipment, knowing or having reason to know that the device or equipment is primarily of assistance in the unauthorized decryption of satellite cable programming, or is intended for any other activity prohibited by [Section 605(a)] shall be fined not more than $500,000 for each violation, or imprisoned for not more than 5 years for each violation, or both. For purposes of all penalties and remedies established for violations of this paragraph, the prohibited activity established herein as it applies to each such device shall be deemed a separate violation. [571]
Precedent for this type of legislation is also found in the international arena. The NAFTA requires each party to make it a criminal offense to "manufacture, import, sell, lease or otherwise make available a device or system that is primarily of assistance in decoding an encrypted programcarrying satellite signal without the authorization of the lawful distributor of such signal . . . ."572 In 1988, the United Kingdom enacted legislation prohibiting the manufacture, distribution or sale of a device designed or adapted to circumvent copy-protection systems. [573]
7. COPYRIGHT MANAGEMENT INFORMATION
In the future, the copyright management information associated with a work -- such as the name of the copyright owner and the terms and conditions for uses of the work -- may be critical to the efficient operation and success of the NII. Copyright management information will serve as a kind of license plate for a work on the information superhighway, from which a user may obtain important information about the work. The accuracy of such information will be crucial to the ability of consumers to find and make authorized uses of copyrighted works on the NII. Reliable information will also facilitate efficient licensing and reduce transaction costs for licensable uses of copyrighted works (both fee-based and royalty-free).
The public should be protected from false information about who created the work, who owns rights in it, and what uses may be authorized by the copyright owner. Therefore, the Working Group recommends that the Copyright Act be amended to prohibit the provision, distribution or importation for distribution of copyright management information known to be false and the unauthorized removal or alteration of copyright management information. Under the proposed amendment, copyright management information is defined as the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation -- to provide adequate flexibility in the future. [574]
While the proposed amendment does not require copyright owners to provide copyright management information, it does require that when such information is included, it be accurate. However, the Working Group encourages copyright owners to include the information to enable consumers to more easily find and make authorized uses of copyrighted works. Nor does it specify standardized formats or content, although private sector initiatives in this area are underway and are also encouraged by the Working Group. Finally, it does not require transmitting entities to include the copyright information as part of their transmission of a work where such information has been included in the work. [575] However, such a proposal deserves further consideration.
The proposal prohibits the falsification, alteration or removal of any copyright management information -- not just that which is included in or digitally linked to the copyrighted work. Many users will obtain such information from public registers, where the integrity of such information will be no less important. The proposal also contains a knowledge requirement; therefore, inadvertent falsification, alteration or removal would not be a violation. [576]
B. PATENT
The present law governing the eligibility of inventions for patent protection and the enforcement of patent rights appears adequate to address the needs of inventors and the public with regard to technology used on the NII. The NII will increase the accessibility and content of the body of prior art, which in turn will affect patentability determinations. The law governing information that properly is considered part of the prior art appears to be adequate to address new forms of "printed" publications; however, some issues related to the authenticity, including the date of origination, the contents as originally disclosed, and the extent of dissemination of electronically disseminated publications, deserve further study.
The Working Group recommends that the Patent and Trademark Office obtain public input related to measures that can be adopted to ensure the authenticity of electronically-disseminated publications, particularly with respect to verifying the contents and date of first public dissemination of the publication, and evaluating the substantive value of the information contained in the publication as to its role in patentability determinations.
The Working Group also recommends that the PTO explore the feasibility of establishing requirements or standards that would govern authentication of the date and contents of electronically-disseminated information for purposes of establishing their use as prior art. Such standards would assist in patentability determinations, whether they occur before the PTO or before a court. To develop such standards, the PTO should invite public comment and work with other interested Federal agencies working on authentication standards outside the direct sphere of the patent system.
C. TRADEMARK
The Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks must be sufficiently flexible to accommodate the changing goods and services available in connection with the NII and the GII. Such flexibility is essential to the owners of marks identifying goods and services connected with the NII and the GII, as well as to the continued viability of the International Classification system in the electronic information age. Therefore, the Working Group recommends that the Patent and Trademark Office, in the context of WIPO experts meetings on the International Classification system, propose changes to the International Classification system to ensure that the system reflects the goods and services of modern information technology. Additionally, the Working Group recommends that the Patent and Trademark Office regularly update its Manual for the Identification of Goods and Services to reflect new goods and services used on or in connection with the NII and GII.
_______________
Notes:
529. H.R. REP. NO. 101-735, 101st Cong., 2d Sess. 7 (1990), reprinted in 1990 U.S.C.C.A.N. 6935, 6938 (report accompanying legislation granting copyright owners of computer software an exclusive rental right).
530. Sony, supra note 361, at 430-31.
531. See discussion of the Constitutional purpose of copyright supra pp. 19-23.
532. Sony, supra note 361, at 431.
533. See supra p. 13.
534. See discussion supra pp. 70-73.
535. In contrast, a "standard" distribution of a copy necessarily divests the distributor of his copy. In the case of a distribution by transmission, the distributor generally retains his copy of the work and a reproduction is distributed.
536. It has been suggested that recognition of distribution by transmission may diminish the public performance right. However, if a work is publicly performed by transmission, then there has been a public performance -- whether or not the distribution right is or is not also involved. The fact that some transmissions may constitute a reproduction and distribution of copies to the public does not mean that transmissions that constitute public performances are not public performances. The scope of the public performance right is not diminished by the recognition that a transmission may fall within the scope of the distribution right. If a copy of a motion picture is transmitted to a computer's memory, for instance, and in the process, the sounds are capable of being heard and the images viewed as they are received in memory, then the public performance right may well be implicated as well. See 17 U.S.C. § 101 (1988) (definition of "perform").
537. The exclusive rights, "which comprise the so-called 'bundle of rights' that is a copyright, are cumulative and may overlap in some cases. Each of the five enumerated rights may be subdivided indefinitely, and . . . each subdivision of an exclusive right may be owned and enforced separately." HOUSE REPORT at 61, reprinted in 1976 U.S.C.C.A.N. 5674.
538. See discussion supra pp. 45-47.
539. HOUSE REPORT at 61, reprinted in 1976 U.S.C.C.A.N. 5674.
540. See discussion supra pp. 28-32. The term "public" as used in connection with the distribution right is not coincident with the meaning assigned to that term in connection with the public performance or public display right.
541. If copies of works are offered to the public -- even though they may be distributed one copy at a time -- it would likely constitute distribution to the public. See 17 U.S.C. § 101 (1988) (definition of "publication"); 1 NIMMER ON COPYRIGHT § 4.04 at 4-20.
542. In the future, transmission may become the conventional means of distribution.
543. Under the proposed definition, to transmit a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent.
544. To delineate between those transmissions that are communications of performances or displays and those that are distributions of reproductions, one may look at both ends of the transmission. Did the transmitter intend to communicate a performance or display of the work or, rather, to distribute a reproduction of the work? Did the receiver simply hear or see the work or rather/also receive a copy of it? Did the receiver simply receive a copy or was it possible for her to hear or see it as well? License rates and terms will assist in determining the intent of the parties.
545. See HOUSE REPORT at 138 (emphasis added), reprinted in 1976 U.S.C.C.A.N. 5754.
546. See discussion supra pp. 28-32. The House Report also states, however, that the definition was intended to clarify that the offering of copies or phonorecords to a group of, for instance, wholesalers, broadcasters or motion picture theater operators constitutes publication if the purpose of the offering is "further distribution, public performance, or display." See HOUSE REPORT at 138, reprinted in 1976 U.S.C.C.A.N. 5754. Therefore, if an author offers copies to bulletin board system operators or others for further distribution, public performance or public display on a computer network, publication may occur.
547. Under the current law, the distribution right is identified as the right "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." See 17 U.S.C. § 106(3) (1988). Publication is "the distribution of copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." See 17 U.S.C. § 101 (1988) (part of definition of "publication").
548. Under the law of the United Kingdom, making a work available to the public by means of an electronic retrieval system constitutes publication. See Copyright, Designs and Patents Act of 1988, § 175(1)(b).
549. See supra notes 68-83 and accompanying text.
550. In the print domain, prior published editions are more easily and generally available for reference, partially because of the deposit requirement, but primarily because subsequent versions do not override the originals -- which is possible in the on-line environment.
551. See discussion supra pp. 28-32.
552. See discussion of the doctrine of limited publication supra pp. 31-32.
553. See White v. Kimmell, 193 F.2d 744 (9th Cir. 1952) (unrestricted circulation of 200 copies of a manuscript to friends and acquaintances published the work); Continental Casualty Co. v. Beardsley, 253 F.2d 702 (2d Cir. 1958) (distribution of approximately 100 sets of forms to corporate officers and surety companies for possible purchase of more constituted publication).
554. See discussion of the importation right supra pp. 107-09.
555. Some transmissions that clearly constitute public performances may, in effect, substitute for distributions in the future. If consumers are offered a service through which they can receive a performance of any sound recording at any time, they may stop buying phonorecords. The market for distributed phonorecords may shrink to include only the providers of that service to consumers.
556. If the copyright owners of sound recordings abused the exclusivity that the law should provide, the solution would lie in the enforcement of the antitrust laws -- where the music licensing problems have been addressed -- not in the reduction of rights under the Copyright Act.
557. See S. 227, 104th Cong., 1st Sess. (1995); H.R. 1506, 104th Cong., 1st Sess. (1995).
558. See discussion supra pp. 73-82.
559. The legislative history makes it clear that digital uses are generally not encompassed by Section 108: "Under this exemption, for example, a repository could make photocopies of manuscripts by microfilm or electrostatic process, but could not reproduce the work in 'machine-readable' language for storage in an information system." HOUSE REPORT at 75, reprinted in 1976 U.S.C.C.A.N. 5689; Senate Report at 67 (emphasis added). The Senate Report also speaks precisely of "the photocopying needs of . . . multi-county regional systems." Id. at 70 (emphasis added).
560. The Working Group believes that replacement copies may be digital in nature, and may be made under this provision only when an unused replacement is not available in either digital or analog form.
561. See, e.g., Section 53D of the Australian law (privilege conditioned on copyright owner's abstention from market for Braille edition); Section 18 of the Finnish law (Braille editions and talking books may be manufactured "for use by lending libraries for blind persons"); Section 80 of the Portuguese law (Braille editions may be manufactured if not for profit).
562. The visually impaired were the only users with a disability who provided comments or testimony concerning a need for a narrow exemption to ensure the availability of literary works in a usable form. By its recommendation of such an exemption for the visually impaired, the Working Group does not intend to dismiss the possibility that other disabled users may have needs of which it has not been made aware and, therefore, has not considered.
563. See discussion of criminal offenses supra pp. 126-28.
564. See discussion of the LaMacchia case supra p. 127.
565. As noted earlier, the idea/expression dichotomy and the limitations on the exclusive rights, including fair use, address First Amendment concerns. See supra pp. 32-35, 73-100 and note 227. See also Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 560 (1985) ("First Amendment protections [are] embodied in the [Copyright] Act's distinction between copyrightable expression and uncopyrightable facts and ideas, and the latitude for scholarship and comment traditionally afforded by fair use").
566. Legislation of a similar type has been introduced with respect to technological protection of audiovisual works. See, e.g., S. 1096, 102d Cong., 1st Sess., 137 Cong. Rec. S. 6034 (1991); H.R. 3568, 101st Cong., 1st Sess., 135 Cong. Rec. H. 7924 (1989).
567. Copies of the work in the marketplace free from copyright protection could be freely reproduced (and, in fact, the lower distribution costs of the NII may encourage increased availability of public domain works). Further, technological protection that restricts the ability to reproduce the work by technical means does not prevent reproduction by other means (such as quoting, manually copying, etc.).
568. However, the Working Group does encourage the equipment manufacturing and copyright industries to work together on bilateral solutions for other types of recording devices and categories of works. In response to a request from Congressional leaders, representatives of the motion picture industry and the consumer electronics industry are presently drafting a joint legislative proposal addressing legal and technical measures pertaining to consumer recording of motion pictures. This proposal would set forth a technical means to be applied that would respect the legitimate commercial expectations of copyright owners and the reasonable and customary copying practices of consumers.
569. Some have suggested that while manufacturers will surely know the primary purpose of the devices they produce, they may inadvertently find themselves liable for devices which they intended for legal purposes, but which have the incidental effect of circumventing copyright protection systems. For a manufacturer to find himself in this situation, the device would have to fail to be used primarily for the purpose for which it was sold, and be primarily used, to the surprise of its manufacturer, for defeating protection systems. It is likely that such a situation would occur rarely, if ever. (It would be self-defeating for copyright owners to begin using a protection system that an existing device could defeat.) However, the chapter contains an "innocent violation" provision for just such a case. A court would have the ability to reduce or eliminate altogether any damages for which the manufacturer would otherwise be liable, to avoid an unfair result but still protect the copyright owner.
570. 17 U.S.C. § 1002(c) (Supp. V 1993).
571. 47 U.S.C. § 605(e)(4) (1988).
572. See NAFTA, supra note 446, at art. 1707(a). The NAFTA also requires parties to make it a civil offense to "receive, in connection with commercial activities, or further distribute, an encrypted program-carrying satellite signal that has been decoded without the authorization of the lawful distributor of the signal or to engage in any activity prohibited under [the criminal provisions]." See NAFTA, supra note 446, at art. 1707(b).
573. See Copyright, Designs and Patents Act of 1988, Part VII, § 296.
574. Other information that may become important to the efficient operation of the NII includes the country of origin of the work, the year of creation or first publication, a description of the work, the name and other identifying information of licensees and standardized codes.
575. While a transmitting entity may not remove the copyright management information, if such information is not included in the normal course of the transmission (such as when a work in digital form is broadcast through analog transmission), no violation would occur.
576. For criminal liability, both knowledge and the intent to defraud are required.
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Re: Intellectual Property and the National Information Infra
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APPENDICES
1. PROPOSED LEGISLATION
2. STATUTORY MARK-UP
3. PARTICIPATING AGENCIES
104TH CONGRESS
1ST SESSION [S./H.R.] _____
To amend title 17 to adapt the copyright law to the digital, networked environment of the National Information Infrastructure, and for other purposes.
____________________________
IN THE [SENATE/HOUSE OF REPRESENTATIVES] OF THE UNITED STATES
September __ , 1995
M_. __________ (for h__self and M_. __________) introduced the following bill; which was read twice and referred to the Committee on the Judiciary.
____________________________
A BILL
To amend title 17 to adapt the copyright law to the digital, networked environment of the National Information Infrastructure, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the "NII Copyright Protection Act of 1995".
SEC. 2. TRANSMISSION OF COPIES.
(a) DISTRIBUTION. -- Section 106(3) of title 17, United States Code, is amended by striking "or by rental, lease, or lending" and inserting "by rental, lease, or lending, or by transmission".
(b) DEFINITIONS. -- Section 101 of title 17, United States Code, is amended --
(1) in the definition of "publication" by striking "or by rental, lease, or lending" in the first sentence and insert "by rental, lease, or lending, or by transmission"; and
(2) in the definition of "transmit" by inserting at the end thereof the following: "To 'transmit' a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent.".
(c) IMPORTATION. -- Section 602 of title 17, United States Code, is amended by inserting "whether by carriage of tangible goods or by transmission," after "Importation into the United States,".
SEC. 3. EXEMPTIONS FOR LIBRARIES AND THE VISUALLY IMPAIRED.
(a) LIBRARIES. -- Section 108 of title 17, United States Code, is amended --
(1) in subsection (a) by deleting "one copy or phonorecord" and inserting in lieu thereof "three copies or phonorecords";
(2) in subsection (a) by deleting "such copy or phonorecord" and inserting in lieu thereof "no more than one of such copies or phonorecords";
(3) by inserting at the end of subsection (a)(3) "if such notice appears on the copy or phonorecord that is reproduced under the provisions of this section";
(4) in subsection (b) by inserting "or digital" after "facsimile" and by inserting "in facsimile form" before "for deposit for research use"; and
(5) in subsection (c) by inserting "or digital" after "facsimile".
(b) VISUALLY IMPAIRED -- Title 17, United States Code, is amended by adding the following new section:
"§ 108A. Limitations on exclusive rights: Reproduction for the Visually Impaired.
"Notwithstanding the provision of section 106, it is not an infringement of copyright for a non-profit organization to reproduce and distribute to the visually impaired, at cost, a Braille, large type, audio or other edition of a previously published literary work in a form intended to be perceived by the visually impaired, provided that, during a period of at least one year after the first publication of a standard edition of such work in the United States, the owner of the exclusive right to distribute such work in the United States has not entered the market for editions intended to be perceived by the visually impaired."
SEC. 4. COPYRIGHT PROTECTION SYSTEMS AND COPYRIGHT MANAGEMENT INFORMATION.
Title 17, United States Code, is amended by adding the following new chapter:
"Chapter 12. -- COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS
"Sec.
"1201. Circumvention of Copyright Protection Systems
"1202. Integrity of Copyright Management Information
"1203. Civil Remedies
"1204. Criminal Offenses and Penalties
"§ 1201. Circumvention of Copyright Protection Systems
"No person shall import, manufacture or distribute any device, product, or component incorporated into a device or product, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without the authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights of the copyright owner under section 106.
"§ 1202. Integrity of Copyright Management Information
"(a) FALSE COPYRIGHT MANAGEMENT INFORMATION. -- No person shall knowingly provide copyright management information that is false, or knowingly publicly distribute or import for public distribution copyright management information that is false.
"(b) REMOVAL OR ALTERATION OF COPYRIGHT MANAGEMENT INFORMATION. -- No person shall, without authority of the copyright owner or the law, (i) knowingly remove or alter any copyright management information, (ii) knowingly distribute or import for distribution copyright management information that has been altered without authority of the copyright owner or the law, or (iii) knowingly distribute or import for distribution copies or phonorecords from which copyright management information has been removed without authority of the copyright owner or the law.
"(c) DEFINITION. -- As used in this chapter, "copyright management information" means the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation.
"§ 1203. Civil Remedies
"(a) CIVIL ACTIONS. -- Any person injured by a violation of Sec. 1201 or 1202 may bring a civil action in an appropriate United States district court for such violation.
"(b) POWERS OF THE COURT. -- In an action brought under subsection (a), the court --
"(1) may grant temporary and permanent injunctions on such terms as it deems reasonable to prevent or restrain a violation;
"(2) at any time while an action is pending, may order the impounding, on such terms as it deems reasonable, of any device or product that is in the custody or control of the alleged violator and that the court has reasonable cause to believe was involved in a violation;
"(3) may award damages under subsection (c);
"(4) in its discretion may allow the recovery of costs by or against any party other than the United States or an officer thereof;
"(5) in its discretion may award reasonable attorney's fees to the prevailing party; and
"(6) may, as part of a final judgment or decree finding a violation, order the remedial modification or the destruction of any device or product involved in the violation that is in the custody or control of the violator or has been impounded under subsection (2).
"(c) AWARD OF DAMAGES. --
"(1) IN GENERAL. -- Except as otherwise provided in this chapter, a violator is liable for either (i) the actual damages and any additional profits of the violator, as provided by subsection (2) or (ii) statutory damages, as provided by subsection (3).
"(2) ACTUAL DAMAGES. -- The court shall award to the complaining party the actual damages suffered by him or her as a result of the violation, and any profits of the violator that are attributable to the violation and are not taken into account in computing the actual damages, if the complaining party elects such damages at any time before final judgment is entered.
"(3) STATUTORY DAMAGES. --
"(A) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1201 in the sum of not less than $200 or more than $2,500 per device, product, offer or performance of service, as the court considers just.
"(B) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1202 in the sum of not less than $2,500 or more than $25,000.
"(4) REPEATED VIOLATIONS. -- In any case in which the injured party sustains the burden of proving, and the court finds, that a person has violated section 1201 or 1202 within three years after a final judgment was entered against that person for another such violation, the court may increase the award of damages up to triple the amount that would otherwise be awarded, as the court considers just.
"(5) INNOCENT VIOLATIONS. -- The court in its discretion may reduce or remit altogether the total award of damages in any case in which the violator sustains the burden of proving, and the court finds, that the violator was not aware and had no reason to believe that its acts constituted a violation.
"§ 1204. Criminal Offenses and Penalties
"Any person who violates section 1202 with intent to defraud shall be fined not more than $500,000 or imprisoned for not more than 5 years, or both.”
SEC. 5. CONFORMING AMENDMENTS.
(a) TABLE OF SECTIONS. -- The table of sections for chapter 1 of title 17, United States Code, is amended by inserting after the item relating to section 108 the following:
"108A. Limitations on exclusive rights: Reproduction for the Visually Impaired."
(b) TABLE OF CHAPTERS. -- The table of chapters for title 17, United States Code, is amended by adding at the end the following:
"12. COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS ..........................1201".
SEC. 6. EFFECTIVE DATE.
This Act, and the amendments made by this Act, shall take effect on the date of the enactment of this Act.
STATUTORY MARK-UP
Language added by a proposed amendment is in italics. Proposed deletions are indicated by strike-throughs.
17 U.S.C. § 106(3)
"(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending, or by transmission."
17 U.S.C. § 101
'"Publication' is the distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership, or by rental, lease, or lending, or by transmission. The offering to distribute copies or phonorecords to a group of persons for purposes of further distribution, public performance, or public display, constitutes publication. A public performance or display of a work does not of itself constitute publication."
"To 'transmit' a performance or display is to communicate it by any device or process whereby images or sounds are received beyond the place from which they are sent. To 'transmit' a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent."
17 U.S.C. § 108
"(a) Notwithstanding the provisions of section 106, it is not an infringement of copyright for a library or archives, or any of its employees acting within the scope of their employment, to reproduce no more than one copy or phonorecord three copies or phonorecords of a work, or to distribute such copy or phonorecord no more than one of such copies or phonorecords, under the conditions specified by this section, if--
"(1) the reproduction or distribution is made without any purpose of direct or indirect commercial advantage;
"(2) the collections of the library or archives are (i) open to the public, or (ii) available not only to researchers affiliated with the library or archives or with the institution of which it is a part, but also to other persons doing research in a specialized field; and
"(3) the reproduction or distribution of the work includes a notice of copyright if such notice appears on the copy or phonorecord that is reproduced under the provisions of this section.
"(b) The rights of reproduction and distribution under this section apply to a copy or phonorecord of an unpublished work duplicated in facsimile or digital form solely for purposes of preservation and security or in facsimile form for deposit for research use in another library or archives of the type described by clause (2) of subsection (a), if the copy or phonorecord reproduced is currently in the collections of the library or archives.
"(c) The right of reproduction under this section applies to a copy or phonorecord of a published work duplicated in facsimile or digital form solely for the purpose of replacement of a copy or phonorecord that is damaged, deteriorating, lost, or stolen, if the library or archives has, after a reasonable effort, determined that an unused replacement cannot be obtained at a fair price."
17 U.S.C. § 108A
"§ 108A. Limitations on exclusive rights: Reproduction for the Visually Impaired. "Notwithstanding the provision
of section 106, it is not an infringement of copyright for a non-profit organization to reproduce and distribute to the visually impaired, at cost, a Braille, large type, audio or other edition of a previously published literary work in a form intended to be perceived by the visually impaired, provided that, during a period of at least one year after the first publication of a standard edition of such work in the United States, the owner of the exclusive right to distribute such work in the United States has not entered the market for editions intended to be perceived by the visually impaired."
17 U.S.C. § 602
"(a) Importation into the United States, whether by carriage of tangible goods or by transmission, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringement of the exclusive right to distribute copies or phonorecords under section 106, actionable under section 501."
Title 17, Chapter 12
"Chapter 12. -- COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS
"Sec.
"1201. Circumvention of Copyright Protection Systems
"1202. Integrity of Copyright Management Information
"1203. Civil Remedies
"1204. Criminal Offenses and Penalties
"§ 1201. Circumvention of Copyright Protection Systems
"No person shall import, manufacture or distribute any device, product, or component incorporated into a device or product, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without the authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights of the copyright owner under section 106.
"§ 1202. Integrity of Copyright Management Information
"(a) FALSE COPYRIGHT MANAGEMENT INFORMATION. -- No person shall knowingly provide copyright management information that is false, or knowingly publicly distribute or import for public distribution copyright management information that is false.
"(b) REMOVAL OR ALTERATION OF COPYRIGHT MANAGEMENT INFORMATION. -- No person shall, without authority of the copyright owner or the law, (i) knowingly remove or alter any copyright management information, (ii) knowingly distribute or import for distribution copyright management information that has been altered without authority of the copyright owner or the law, or (iii) knowingly distribute or import for distribution copies or phonorecords from which copyright management information has been removed without authority of the copyright owner or the law.
"(c) DEFINITION. -- As used in this chapter, "copyright management information" means the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation.
"§ 1203. Civil Remedies
"(a) CIVIL ACTIONS. -- Any person injured by a violation of Sec. 1201 or 1202 may bring a civil action in an appropriate United States district court for such violation.
"(b) POWERS OF THE COURT. -- In an action brought under subsection (a), the court --
"(1) may grant temporary and permanent injunctions on such terms as it deems reasonable to prevent or restrain a violation;
"(2) at any time while an action is pending, may order the impounding, on such terms as it deems reasonable, of any device or product that is in the custody or control of the alleged violator and that the court has reasonable cause to believe was involved in a violation;
"(3) may award damages under subsection (c);
"(4) in its discretion may allow the recovery of costs by or against any party other than the United States or an officer thereof;
"(5) in its discretion may award reasonable attorney's fees to the prevailing party; and
"(6) may, as part of a final judgment or decree finding a violation, order the remedial modification or the destruction of any device or product involved in the violation that is in the custody or control of the violator or has been impounded under subsection (2).
"(c) AWARD OF DAMAGES. --
"(1) IN GENERAL. -- Except as otherwise provided in this chapter, a violator is liable for either (i) the actual damages and any additional profits of the violator, as provided by subsection (2) or (ii) statutory damages, as provided by subsection (3).
"(2) ACTUAL DAMAGES. -- The court shall award to the complaining party the actual damages suffered by him or her as a result of the violation, and any profits of the violator that are attributable to the violation and are not taken into account in computing the actual damages, if the complaining party elects such damages at any time before final judgment is entered.
"(3) STATUTORY DAMAGES. --
"(A) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1201 in the sum of not less than $200 or more than $2,500 per device, product, offer or performance of service, as the court considers just.
"(B) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1202 in the sum of not less than $2,500 or more than $25,000.
"(4) REPEATED VIOLATIONS. -- In any case in which the injured party sustains the burden of proving, and the court finds, that a person has violated section 1201 or 1202 within three years after a final judgment was entered against that person for another such violation, the court may increase the award of damages up to triple the amount that would otherwise be awarded, as the court considers just.
"(5) INNOCENT VIOLATIONS. -- The court in its discretion may reduce or remit altogether the total award of damages in any case in which the violator sustains the burden of proving, and the court finds, that the violator was not aware and had no reason to believe that its acts constituted a violation.
"§ 1204. Criminal Offenses and Penalties
"Any person who violates section 1202 with intent to defraud shall be fined not more than $500,000 or imprisoned for not more than 5 years, or both.”
PARTICIPATING AGENCIES
ADVANCED RESEARCH PROJECTS AGENCY
COUNCIL OF ECONOMIC ADVISERS
ENVIRONMENTAL PROTECTION AGENCY
GENERAL SERVICES ADMINISTRATION
NATIONAL ARCHIVES AND RECORDS
ADMINISTRATION
NATIONAL ECONOMIC COUNCIL
NATIONAL ENDOWMENT FOR THE ARTS
NATIONAL ENDOWMENT FOR THE HUMANITIES
NATIONAL INSTITUTE OF STANDARDS AND
TECHNOLOGY
NATIONAL LIBRARY OF MEDICINE
NATIONAL SCIENCE FOUNDATION
NATIONAL SECURITY AGENCY
NATIONAL TELECOMMUNICATIONS AND
INFORMATION ADMINISTRATION
OFFICE OF SCIENCE AND TECHNOLOGY POLICY
OFFICE OF CONSUMER AFFAIRS
OFFICE OF MANAGEMENT AND BUDGET
OFFICE OF THE U.S. TRADE REPRESENTATIVE
U.S. COPYRIGHT OFFICE
U.S. DEPARTMENT OF COMMERCE
U.S. DEPARTMENT OF DEFENSE
U.S. DEPARTMENT OF EDUCATION
U.S. DEPARTMENT OF ENERGY
U.S. DEPARTMENT OF JUSTICE
U.S. DEPARTMENT OF STATE
U.S. DEPARTMENT OF TREASURY
U.S. PATENT AND TRADEMARK OFFICE
1. PROPOSED LEGISLATION
2. STATUTORY MARK-UP
3. PARTICIPATING AGENCIES
104TH CONGRESS
1ST SESSION [S./H.R.] _____
To amend title 17 to adapt the copyright law to the digital, networked environment of the National Information Infrastructure, and for other purposes.
____________________________
IN THE [SENATE/HOUSE OF REPRESENTATIVES] OF THE UNITED STATES
September __ , 1995
M_. __________ (for h__self and M_. __________) introduced the following bill; which was read twice and referred to the Committee on the Judiciary.
____________________________
A BILL
To amend title 17 to adapt the copyright law to the digital, networked environment of the National Information Infrastructure, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the "NII Copyright Protection Act of 1995".
SEC. 2. TRANSMISSION OF COPIES.
(a) DISTRIBUTION. -- Section 106(3) of title 17, United States Code, is amended by striking "or by rental, lease, or lending" and inserting "by rental, lease, or lending, or by transmission".
(b) DEFINITIONS. -- Section 101 of title 17, United States Code, is amended --
(1) in the definition of "publication" by striking "or by rental, lease, or lending" in the first sentence and insert "by rental, lease, or lending, or by transmission"; and
(2) in the definition of "transmit" by inserting at the end thereof the following: "To 'transmit' a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent.".
(c) IMPORTATION. -- Section 602 of title 17, United States Code, is amended by inserting "whether by carriage of tangible goods or by transmission," after "Importation into the United States,".
SEC. 3. EXEMPTIONS FOR LIBRARIES AND THE VISUALLY IMPAIRED.
(a) LIBRARIES. -- Section 108 of title 17, United States Code, is amended --
(1) in subsection (a) by deleting "one copy or phonorecord" and inserting in lieu thereof "three copies or phonorecords";
(2) in subsection (a) by deleting "such copy or phonorecord" and inserting in lieu thereof "no more than one of such copies or phonorecords";
(3) by inserting at the end of subsection (a)(3) "if such notice appears on the copy or phonorecord that is reproduced under the provisions of this section";
(4) in subsection (b) by inserting "or digital" after "facsimile" and by inserting "in facsimile form" before "for deposit for research use"; and
(5) in subsection (c) by inserting "or digital" after "facsimile".
(b) VISUALLY IMPAIRED -- Title 17, United States Code, is amended by adding the following new section:
"§ 108A. Limitations on exclusive rights: Reproduction for the Visually Impaired.
"Notwithstanding the provision of section 106, it is not an infringement of copyright for a non-profit organization to reproduce and distribute to the visually impaired, at cost, a Braille, large type, audio or other edition of a previously published literary work in a form intended to be perceived by the visually impaired, provided that, during a period of at least one year after the first publication of a standard edition of such work in the United States, the owner of the exclusive right to distribute such work in the United States has not entered the market for editions intended to be perceived by the visually impaired."
SEC. 4. COPYRIGHT PROTECTION SYSTEMS AND COPYRIGHT MANAGEMENT INFORMATION.
Title 17, United States Code, is amended by adding the following new chapter:
"Chapter 12. -- COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS
"Sec.
"1201. Circumvention of Copyright Protection Systems
"1202. Integrity of Copyright Management Information
"1203. Civil Remedies
"1204. Criminal Offenses and Penalties
"§ 1201. Circumvention of Copyright Protection Systems
"No person shall import, manufacture or distribute any device, product, or component incorporated into a device or product, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without the authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights of the copyright owner under section 106.
"§ 1202. Integrity of Copyright Management Information
"(a) FALSE COPYRIGHT MANAGEMENT INFORMATION. -- No person shall knowingly provide copyright management information that is false, or knowingly publicly distribute or import for public distribution copyright management information that is false.
"(b) REMOVAL OR ALTERATION OF COPYRIGHT MANAGEMENT INFORMATION. -- No person shall, without authority of the copyright owner or the law, (i) knowingly remove or alter any copyright management information, (ii) knowingly distribute or import for distribution copyright management information that has been altered without authority of the copyright owner or the law, or (iii) knowingly distribute or import for distribution copies or phonorecords from which copyright management information has been removed without authority of the copyright owner or the law.
"(c) DEFINITION. -- As used in this chapter, "copyright management information" means the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation.
"§ 1203. Civil Remedies
"(a) CIVIL ACTIONS. -- Any person injured by a violation of Sec. 1201 or 1202 may bring a civil action in an appropriate United States district court for such violation.
"(b) POWERS OF THE COURT. -- In an action brought under subsection (a), the court --
"(1) may grant temporary and permanent injunctions on such terms as it deems reasonable to prevent or restrain a violation;
"(2) at any time while an action is pending, may order the impounding, on such terms as it deems reasonable, of any device or product that is in the custody or control of the alleged violator and that the court has reasonable cause to believe was involved in a violation;
"(3) may award damages under subsection (c);
"(4) in its discretion may allow the recovery of costs by or against any party other than the United States or an officer thereof;
"(5) in its discretion may award reasonable attorney's fees to the prevailing party; and
"(6) may, as part of a final judgment or decree finding a violation, order the remedial modification or the destruction of any device or product involved in the violation that is in the custody or control of the violator or has been impounded under subsection (2).
"(c) AWARD OF DAMAGES. --
"(1) IN GENERAL. -- Except as otherwise provided in this chapter, a violator is liable for either (i) the actual damages and any additional profits of the violator, as provided by subsection (2) or (ii) statutory damages, as provided by subsection (3).
"(2) ACTUAL DAMAGES. -- The court shall award to the complaining party the actual damages suffered by him or her as a result of the violation, and any profits of the violator that are attributable to the violation and are not taken into account in computing the actual damages, if the complaining party elects such damages at any time before final judgment is entered.
"(3) STATUTORY DAMAGES. --
"(A) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1201 in the sum of not less than $200 or more than $2,500 per device, product, offer or performance of service, as the court considers just.
"(B) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1202 in the sum of not less than $2,500 or more than $25,000.
"(4) REPEATED VIOLATIONS. -- In any case in which the injured party sustains the burden of proving, and the court finds, that a person has violated section 1201 or 1202 within three years after a final judgment was entered against that person for another such violation, the court may increase the award of damages up to triple the amount that would otherwise be awarded, as the court considers just.
"(5) INNOCENT VIOLATIONS. -- The court in its discretion may reduce or remit altogether the total award of damages in any case in which the violator sustains the burden of proving, and the court finds, that the violator was not aware and had no reason to believe that its acts constituted a violation.
"§ 1204. Criminal Offenses and Penalties
"Any person who violates section 1202 with intent to defraud shall be fined not more than $500,000 or imprisoned for not more than 5 years, or both.”
SEC. 5. CONFORMING AMENDMENTS.
(a) TABLE OF SECTIONS. -- The table of sections for chapter 1 of title 17, United States Code, is amended by inserting after the item relating to section 108 the following:
"108A. Limitations on exclusive rights: Reproduction for the Visually Impaired."
(b) TABLE OF CHAPTERS. -- The table of chapters for title 17, United States Code, is amended by adding at the end the following:
"12. COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS ..........................1201".
SEC. 6. EFFECTIVE DATE.
This Act, and the amendments made by this Act, shall take effect on the date of the enactment of this Act.
STATUTORY MARK-UP
Language added by a proposed amendment is in italics. Proposed deletions are indicated by strike-throughs.
17 U.S.C. § 106(3)
"(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending, or by transmission."
17 U.S.C. § 101
'"Publication' is the distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership, or by rental, lease, or lending, or by transmission. The offering to distribute copies or phonorecords to a group of persons for purposes of further distribution, public performance, or public display, constitutes publication. A public performance or display of a work does not of itself constitute publication."
"To 'transmit' a performance or display is to communicate it by any device or process whereby images or sounds are received beyond the place from which they are sent. To 'transmit' a reproduction is to distribute it by any device or process whereby a copy or phonorecord of the work is fixed beyond the place from which it was sent."
17 U.S.C. § 108
"(a) Notwithstanding the provisions of section 106, it is not an infringement of copyright for a library or archives, or any of its employees acting within the scope of their employment, to reproduce no more than one copy or phonorecord three copies or phonorecords of a work, or to distribute such copy or phonorecord no more than one of such copies or phonorecords, under the conditions specified by this section, if--
"(1) the reproduction or distribution is made without any purpose of direct or indirect commercial advantage;
"(2) the collections of the library or archives are (i) open to the public, or (ii) available not only to researchers affiliated with the library or archives or with the institution of which it is a part, but also to other persons doing research in a specialized field; and
"(3) the reproduction or distribution of the work includes a notice of copyright if such notice appears on the copy or phonorecord that is reproduced under the provisions of this section.
"(b) The rights of reproduction and distribution under this section apply to a copy or phonorecord of an unpublished work duplicated in facsimile or digital form solely for purposes of preservation and security or in facsimile form for deposit for research use in another library or archives of the type described by clause (2) of subsection (a), if the copy or phonorecord reproduced is currently in the collections of the library or archives.
"(c) The right of reproduction under this section applies to a copy or phonorecord of a published work duplicated in facsimile or digital form solely for the purpose of replacement of a copy or phonorecord that is damaged, deteriorating, lost, or stolen, if the library or archives has, after a reasonable effort, determined that an unused replacement cannot be obtained at a fair price."
17 U.S.C. § 108A
"§ 108A. Limitations on exclusive rights: Reproduction for the Visually Impaired. "Notwithstanding the provision
of section 106, it is not an infringement of copyright for a non-profit organization to reproduce and distribute to the visually impaired, at cost, a Braille, large type, audio or other edition of a previously published literary work in a form intended to be perceived by the visually impaired, provided that, during a period of at least one year after the first publication of a standard edition of such work in the United States, the owner of the exclusive right to distribute such work in the United States has not entered the market for editions intended to be perceived by the visually impaired."
17 U.S.C. § 602
"(a) Importation into the United States, whether by carriage of tangible goods or by transmission, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringement of the exclusive right to distribute copies or phonorecords under section 106, actionable under section 501."
Title 17, Chapter 12
"Chapter 12. -- COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS
"Sec.
"1201. Circumvention of Copyright Protection Systems
"1202. Integrity of Copyright Management Information
"1203. Civil Remedies
"1204. Criminal Offenses and Penalties
"§ 1201. Circumvention of Copyright Protection Systems
"No person shall import, manufacture or distribute any device, product, or component incorporated into a device or product, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without the authority of the copyright owner or the law, any process, treatment, mechanism or system which prevents or inhibits the violation of any of the exclusive rights of the copyright owner under section 106.
"§ 1202. Integrity of Copyright Management Information
"(a) FALSE COPYRIGHT MANAGEMENT INFORMATION. -- No person shall knowingly provide copyright management information that is false, or knowingly publicly distribute or import for public distribution copyright management information that is false.
"(b) REMOVAL OR ALTERATION OF COPYRIGHT MANAGEMENT INFORMATION. -- No person shall, without authority of the copyright owner or the law, (i) knowingly remove or alter any copyright management information, (ii) knowingly distribute or import for distribution copyright management information that has been altered without authority of the copyright owner or the law, or (iii) knowingly distribute or import for distribution copies or phonorecords from which copyright management information has been removed without authority of the copyright owner or the law.
"(c) DEFINITION. -- As used in this chapter, "copyright management information" means the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation.
"§ 1203. Civil Remedies
"(a) CIVIL ACTIONS. -- Any person injured by a violation of Sec. 1201 or 1202 may bring a civil action in an appropriate United States district court for such violation.
"(b) POWERS OF THE COURT. -- In an action brought under subsection (a), the court --
"(1) may grant temporary and permanent injunctions on such terms as it deems reasonable to prevent or restrain a violation;
"(2) at any time while an action is pending, may order the impounding, on such terms as it deems reasonable, of any device or product that is in the custody or control of the alleged violator and that the court has reasonable cause to believe was involved in a violation;
"(3) may award damages under subsection (c);
"(4) in its discretion may allow the recovery of costs by or against any party other than the United States or an officer thereof;
"(5) in its discretion may award reasonable attorney's fees to the prevailing party; and
"(6) may, as part of a final judgment or decree finding a violation, order the remedial modification or the destruction of any device or product involved in the violation that is in the custody or control of the violator or has been impounded under subsection (2).
"(c) AWARD OF DAMAGES. --
"(1) IN GENERAL. -- Except as otherwise provided in this chapter, a violator is liable for either (i) the actual damages and any additional profits of the violator, as provided by subsection (2) or (ii) statutory damages, as provided by subsection (3).
"(2) ACTUAL DAMAGES. -- The court shall award to the complaining party the actual damages suffered by him or her as a result of the violation, and any profits of the violator that are attributable to the violation and are not taken into account in computing the actual damages, if the complaining party elects such damages at any time before final judgment is entered.
"(3) STATUTORY DAMAGES. --
"(A) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1201 in the sum of not less than $200 or more than $2,500 per device, product, offer or performance of service, as the court considers just.
"(B) At any time before final judgment is entered, a complaining party may elect to recover an award of statutory damages for each violation of section 1202 in the sum of not less than $2,500 or more than $25,000.
"(4) REPEATED VIOLATIONS. -- In any case in which the injured party sustains the burden of proving, and the court finds, that a person has violated section 1201 or 1202 within three years after a final judgment was entered against that person for another such violation, the court may increase the award of damages up to triple the amount that would otherwise be awarded, as the court considers just.
"(5) INNOCENT VIOLATIONS. -- The court in its discretion may reduce or remit altogether the total award of damages in any case in which the violator sustains the burden of proving, and the court finds, that the violator was not aware and had no reason to believe that its acts constituted a violation.
"§ 1204. Criminal Offenses and Penalties
"Any person who violates section 1202 with intent to defraud shall be fined not more than $500,000 or imprisoned for not more than 5 years, or both.”
PARTICIPATING AGENCIES
ADVANCED RESEARCH PROJECTS AGENCY
COUNCIL OF ECONOMIC ADVISERS
ENVIRONMENTAL PROTECTION AGENCY
GENERAL SERVICES ADMINISTRATION
NATIONAL ARCHIVES AND RECORDS
ADMINISTRATION
NATIONAL ECONOMIC COUNCIL
NATIONAL ENDOWMENT FOR THE ARTS
NATIONAL ENDOWMENT FOR THE HUMANITIES
NATIONAL INSTITUTE OF STANDARDS AND
TECHNOLOGY
NATIONAL LIBRARY OF MEDICINE
NATIONAL SCIENCE FOUNDATION
NATIONAL SECURITY AGENCY
NATIONAL TELECOMMUNICATIONS AND
INFORMATION ADMINISTRATION
OFFICE OF SCIENCE AND TECHNOLOGY POLICY
OFFICE OF CONSUMER AFFAIRS
OFFICE OF MANAGEMENT AND BUDGET
OFFICE OF THE U.S. TRADE REPRESENTATIVE
U.S. COPYRIGHT OFFICE
U.S. DEPARTMENT OF COMMERCE
U.S. DEPARTMENT OF DEFENSE
U.S. DEPARTMENT OF EDUCATION
U.S. DEPARTMENT OF ENERGY
U.S. DEPARTMENT OF JUSTICE
U.S. DEPARTMENT OF STATE
U.S. DEPARTMENT OF TREASURY
U.S. PATENT AND TRADEMARK OFFICE
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