Copyright Issues for the 113th Congress

During the first quarter of the 2013, Congressional attention will be focused on budget, appropriations and debt ceiling matters – along with a few other public policy issues that have recently taken center stage – such as gun control and immigration reform.  That does not mean, however, that work on other important issues will cease, and lawmakers will have to contend with several other matters – including key copyright issues – during the 113th Congress.

Earlier this week, the House Judiciary Committee announced its members of the Subcommittee on Courts, Intellectual Property and the Internet.  Below is a discussion of some of the copyright issues that the Subcommittee, and Congress in general, is likely to consider in 2013.

General Copyright Law:

General Copyright Reform:

 2013 will mark the 15^th Anniversary of the Digital Millennium Copyright Act (DMCA), watershed copyright legislation that implemented two 1996 treaties of the World Intellectual Property Organization (WIPO), and Congress may well use this opportunity to review the general state of US copyright law, including whether the current “notice and take down” procedures instituted by the DMCA adequately protect copyright owners and online service providers alike, and well as whether current US copyright laws are adequate to deal with widespread international copyright infringement and counterfeiting practices.

Copyright Exceptions for Libraries and Archives:

Libraries and archives enjoy an exception in the Copyright Act (section 108) that allows them to reproduce and distribute copyrighted works under certain specific conditions. The Copyright Office is formulating a discussion document and preliminary recommendations on amending section 108. Toward that end, the Office is engaging stakeholders through a variety of meetings and public discussions – with the February 8, 2013 Kernochan Center Symposium, “Copyright Exceptions for Libraries in the Digital Age: Section 108 Reform,” as an example.

First Sale Doctrine: 

In 2013, the Supreme Court will decide the Kirtsaeng v. John Wiley & Sons, involving the scope of the First Sale Doctrine. The doctrine currently limits the reach of rights holders of copyrighted hard goods to the first sale, thereby allowing consumers to resell goods that they lawfully purchased. The 2nd Circuit Court of Appeals ruled in the case that the doctrine did not apply when the defendant had family and friends purchase foreign-made textbooks abroad and send them to him in the US, where he then resold them on eBay for a profit.   No matter how the Supreme Court rules, this case will also raise significant questions regarding US law which guards against parallel imports or gray market goods.

Orphan Works:

“Orphan Works” are copyrighted works whose owner cannot be located. Creators interested in using an orphan work are sometimes deterred for fear of having to pay damages if the owner ever surfaces.  Congress has considered legislation in the past that would allow users of copyrighted content to move forward in cases where they wish to license a use but cannot locate the copyright owner after a diligent search. Despite past political difficulties with finding consensus on orphan works legislation, some stakeholders, including the Copyright Office, are continuing to promote the consideration of orphan works legislation.

Small Copyright Claims: 

One of the purposes of US copyright law is to provide copyright owners with a remedy for unauthorized uses of their creations, including by filing lawsuits in federal district courts. Not all copyright owners, however, have the economic resources or incentives to bring a federal lawsuit, which can require a great deal of time and money. While the Copyright Act offers the possibility of statutory damages and attorney’s fees, these benefits are not available in all cases, and even when they are, they may not be recovered until after a lengthy litigation that requires huge up-front costs.  Congress has asked the Copyright Office to study the benefits and drawbacks of how current system resolves small copyright claim disputes, as well as possibility of future alternative systems. The Copyright Office has been engaging stakeholders on this issue and is scheduled to issue a report on this issue in the fall of 2013.

Computer Fraud and Abuse:

Rep. Zoe Lofgren (D-CA) has circulated a draft bill this Congress that would exclude certain violations of private agreements or contractual obligations relating to Internet service from the Computer Fraud and Abuse Act, a 1986 law that makes it illegal to access a computer without authorization.  This draft bill has received much attention on social networking sites, but Rep. Lofgren has acknowledged that Members of Congress might be resistant to her bill out of concern about softening penalties for malicious hackers.

Music Licensing:

Internet Radio Fairness Act:

Last Congress, Rep. Jason Chaffetz (R-UT) and Senator Ron Wyden (D-OR) introduced the Internet Radio Fairness Act of 2012, which would allow online radio services such as Pandora to pay artists and copyright owners lower rates under the 801(b) standard of the Copyright Act – used by certain cable and satellite services since 1995 and “grandfathered” under the 1998 law – instead of the current “willing buyer, willing seller” standard that requires the Copyright Royalty Board to consider what the parties would pay in the marketplace for music for Internet radio.  The House Judiciary Committee held a hearing on this issue in November 2012, and many Committee members were skeptical – if not outright hostile – to this legislation and the equity of paying less to musicians while allowing the current loophole that allows terrestrial radio to avoid paying any performance rights royalties. Despite the Committee’s negative reaction to the Internet Radio Fairness Act, Rep. Chaffetz has indicated that he might re-introduce the bill in a modified form this congress.

Interim FIRST Act:

A draft bill circulated last Congress by  Rep. Jerrold Nadler (D-NY), called the Interim FIRST Act, would put cable and satellite radio services on the same royalty-setting standard as Internet radio. This would lead to higher royalty fees for cable and satellite radio stations. The discussion draft also would make traditional radio stations that do not pay any performance right royalty for terrestrial radio broadcasts, pay a higher fee for their live-streaming broadcasts online.  If Rep. Chaffetz re-introduces some form of legislation to lower digital royalties to performers and music creators, it is likely that Rep. Nader and/or other members of Congress may re-introduce some form of the Interim FIRST Act to address current inequities in the music licensing regime.

Government Appointments:

Undersecretary of Commerce for Intellectual Property and Director of the US Patent and Trademark Office (USPTO): 

Undersecretary of Commerce for Intellectual Property and USPTO Director David Kappos announced that he will be leaving his position the end of January 2013.  Upon Kappos’ departure, Teresa Stanek Rea, currently the Deputy Director of the USPTO, will serve as the Acting Director until President Obama nominates a new Director.  The Director of the USPTO serves as the Administration’s point-person for all domestic and international IP policy – including copyright policy.  As such, the new USPTO Director is likely to have significant influence over copyright law in the US and abroad.

Librarian of Congress: 

Dr. James Billington is the current Librarian of Congress, and he has not made any announcement about retiring.  Dr. Billington has served as Librarian since 1987, and the Copyright Office has thrived under his leadership.  Since he has held the position as Librarian for so many years, some copyright stakeholders are concerned about his possible retirement in the near future and are hopeful that whoever might replace Dr. Billington – whenever he decides to retire –is as supportive of the Copyright Office as Dr. Billington has been.