I’m inspired by Brad Burnham’s post about the Protect IP Act that is about to go to the US Senate for its first vote. Brad and fifty-three other venture capitalists, representing forty firms, rightly recognized the threat that this Act poses to innovation and economic growth in one of our Economy’s most important sectors. Together, they drafted and signed a letter stating the reasons for their opposition, and encouraging the Senate to vote against it. You can (and should) read the letter.
Before joining Brad and company in opposition, I spent some time going through the text of the Act. Regardless of your position on Copyright, one cannot ignore the extent to which certain language in PIPA significantly expands the scope of responsibility for infringement. Even if this expansion of scope helps Copyright holders re-capture a greater proportion of the economic value that is rightfully theirs, it will do so only with serious collateral damage.
I thought it might be helpful to share some of the more egregious clauses (bolding is mine):
(7) the term ‘Internet site dedicated to infringing activities’ means an Internet site that–
(A) has no significant use other than engaging in, enabling, or facilitating the–
(i) reproduction, distribution, or public performance of copyrighted works, in complete or substantially complete form, in a manner that constitutes copyright infringement under section 501 of title 17, United States Code;
(ii) violation of section 1201 of title 17, United States Code; or
(iii) sale, distribution, or promotion of goods, services, or materials bearing a counterfeit mark, as that term is defined in section 34(d) of the Lanham Act; or
(B) is designed, operated, or marketed by its operator or persons operating in concert with the operator, and facts or circumstances suggest is used, primarily as a means for engaging in, enabling, or facilitating the activities described under clauses (i), (ii), or (iii) of subparagraph (A);
I wanted to call out the text above in bold, as this is the type of language that puts at risk the protective measures included in the Digital Millenium Copyright Act. In their letter to the Senate, Brad and his colleagues explain:
Online innovation has flourished, in part, because the Digital Millennium Copyright Act (DMCA), though flawed, created clear, defined safe harbors for online intermediaries. The DMCA creates legal certainty and predictability for online services — so long as they meet the conditions of the safe harbors, including an appropriate notice-and-takedown policy, they have no liability for the acts of their users. At the same time, the DMCA gives rights-holders a way to take down specific infringing content, and it is working well.
But the suffering doesn’t end with the accused. Payment providers, advertising services, and “location tools” (defined broadly as “including a directory, index, reference, pointer, or hypertext link”) – in other words, countless internet services – would be required to shut down all payment capabilities, advertisements, and hyperlinks to the “offending” site:
(B) FINANCIAL TRANSACTION PROVIDERS- A financial transaction provider shall take reasonable measures, as expeditiously as reasonable, designed to prevent, prohibit, or suspend its service from completing payment transactions involving customers located within the United States and the Internet site associated with the domain name set forth in the order.
(C) INTERNET ADVERTISING SERVICES- An Internet advertising service that contracts with the Internet site associated with the domain name set forth in the order to provide advertising to or for that site, or which knowingly serves advertising to or for such site, shall take technically feasible and reasonable measures, as expeditiously as reasonable, designed to–
(i) prevent its service from providing advertisements to the Internet site associated with such domain name; or
(ii) cease making available advertisements for that site, or paid or sponsored search results, links or other placements that provide access to the domain name.
(D) INFORMATION LOCATION TOOLS- An service provider of an information location tool shall take technically feasible and reasonable measures, as expeditiously as possible, to–
(i) remove or disable access to the Internet site associated with the domain name set forth in the order; or
(ii) not serve a hypertext link to such Internet site.
The Protect IP Act promises to unleash a torrent of law suits, which, successful or not, will stunt innovation.