Smith Circulates Manager's Amendment to SOPA; Schedules Judiciary Committee Markup

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By Tamlin H. Bason  

In a manager's amendment to the Stop Online Piracy Act (H.R. 3261), circulated three days before a scheduled House Judiciary Committee markup of the bill, Rep. Lamar Smith (R-Texas) brought the House bill more in line with its Senate counterpart, the Protect IP Act (S. 968), by providing clarity to some of the broad definitions that had served as touch points for criticism.

Under the new language of the bill, rights holders would not be able to unilaterally have a suspected infringing website's financial services cut off without first obtaining a court order. The amendment also narrows the definition of what type of website would be subject to enforcement actions by the U.S. Attorney General. However, although Smith tweaked the language concerning a internet service provider's duty to block infringing websites at the DNS level, such a remedy is still available, a fact that critics of the bill say could undermine the structural integrity of the internet if the bill becomes law.

Original Bill Touched Off Storm of Controversy

Smith introduced H.R. 3261 Oct. 26 (209 PTD, 10/28/11). Though ostensibly aimed at “rogue websites” that traffic counterfeit and pirated goods and are located outside of the United States, many in the tech industry claimed that the language of the bill was too broad and would sweep within its grasp many legitimate websites (221 PTD, 11/16/11).

Under the original bill, both the U.S. attorney general and private rights holders would be able to bring actions against “sites dedicated to the theft of U.S. property.”

Under Section 102 of the bill, the attorney general would be able to require service providers to take “technically feasible and reasonable measures” to prevent access by their subscribers to such sites, including blocking the resolution of domain names by the domain name system. This remedy could be brought to bear against any infringing website that was hosted on a foreign top-level domain. In addition, the attorney general would be able to bring in personam actions against the registrant and owner of the infringing website.

Rights holders, under Section 103 of the original language, would be able to issue notices to payment network providers and internet advertising services that facilitate the operation of these infringing websites. Those receiving notices would have five days to cut off the sites or to engage in a counter-notification process.

Both Sections 102 and 103 of H.R. 3261 applied in instances where “an Internet site or portion thereof” was dedicated to infringement. At Section 103, websites that were dedicated to infringement included a website whose operator “is taking, or has taken, deliberate actions to avoid confirming a high probability of the use of the U.S.-directed site to carry out acts that constitute” infringement.

The primary opposition to this language was twofold. First, opponents pointed out that social media platforms that rely on user uploaded content could unknowingly have a “portion” of a website that contains infringement. These critics argued that the language was vague because it was unclear if an entire website could be shuttered upon the finding of only one instance of infringement.

Additionally, opponents claimed that the remedy under Section 103, which did not require any judicial oversight, would effectively let a rights holder target—and potentially shut down within five days—the financial systems of a website that it thought was infringing, regardless of whether the suspected site had legitimate fair use or other affirmative defenses.

Google Inc., at a Nov. 16 House Judiciary Committee Hearing, told lawmakers that the bill mandated a inefficient and dangerous approach to curbing online infringement (222 PTD, 11/17/11). Google said that the definition of websites that were dedicated to infringement was overbroad and could potentially be interpreted to include intermediaries that are compliant with the safe harbor provisions of the Digital Millennium Copyright Act.

Instead, Google encouraged a “follow the money approach,” under which the financial systems that infringing websites rely on would be leaned on to sever ties with websites that were known to be infringing.

Moreover, Google and many others in the tech community argued that the DNS blocking requirement was both violative of free speech, and was dangerous because it requires ISPs to tamper with the structure of the internet, thus inviting uncertainty into the DNS system. This uncertainty could be exploited by hackers who would potentially be able to redirect the traffic of users seeking legitimate websites, critics argued.

Manager's Amendment Refines Definitions

Section 102 of the manager's amendment permits the attorney general to bring in personam or in rem actions only against a website that “is being operated in a manner that would, if it were a domestic Internet site, subject it (or its associated domain name) to” enforcement actions under existing U.S. law.

More significantly, under Section 103 the amendment eliminates the language that would have held a website liable for failing to avoid confirming the presence of infringement. Indeed, in a savings clause the amendment states, “Nothing in Title I shall be construed to impose a duty to monitor activity on the network or service of an entity described in section 102(c) or 103(c).”

Thus, under the new language, a website is dedicated to the theft of U.S. property only if it is either “primarily designed” or operated “with the object of promoting” trademark or copyright infringement.

Another change is that content owners, under the amendment, would not be able to go straight to the payment networks and advertising services that do business with a website that the rights holder believes is infringing. Rather, like the Protect IP Act which was introduced in May and approved on a voice vote by the Senate Judiciary Committee in July (103 PTD, 5/27/11), content owners must look to the courts for injunctive relief against the foreign site.

“While this is a quicker route for the plaintiff to get a court order, it places more of a burden on plaintiffs in that they cannot just send notices,” Hillel I. Parness, a partner who specializes in intellectual property litigation at Robins, Kaplan, Miller & Ciresi in New York told BNA Dec. 13. “Plus, by extension, it could be viewed as giving more protection to the payment processors and the advertising agencies because they will not be dealing with these non-judicial notices, only with court orders, which have more weight and more certainty to them,” Parness said.

‘Savings Clause' Added to DNS Blocking Language

The DNS blocking language was also modified in the amendment. Instead of requiring that an ISP block a website using unidentified “technically feasible and reasonable measures,” the new language states: 

A service provider shall take such measures as it determines to be the least burdensome, technically feasible, and reasonable means designed to prevent access by its subscribers located within the United States to the foreign infringing site that is subject to the order. Such actions shall be taken as expeditiously as possible.

The amendment also provides a safe harbor for ISPs. It states, “The measures determined by a service provider to be the least burdensome, technically feasible, and reasonable means” to block a domain name “shall fully satisfy the service provider's obligation” under the bill.

Additionally, the “portion thereof” language was clarified by an amendment in Section 104. Under that section, if a court has determined that “only a specifically identified portion of an Internet site” is infringing, then the ISP will only be required to block access to that specific portion of the website.

Another savings clause is intended to assuage the fears of critics who claim that DNS blocking will undermine the structural integrity of the internet. The bill states, “Nothing in title I shall be construed to authorize a court to require compliance with an obligation under Section 102(c) in a manner that would impair the security or integrity of the domain name system.”

Some critics were not convinced.

In a press statement, Bill Wilson, president of Americans for Limited Government, said, “[E]ven with its so-called ‘savings' clauses, this bill will still risk placing unfeasible, court-ordered technology mandates on Internet service providers requiring websites to somehow prevent their services from being used to post infringing material, even if doing so is technically impossible. To avoid litigation, Internet companies will simply stop allowing uploading and file sharing.”

Amendment Follows Introduction of Rival Bill

A bipartisan group of congressman and senators began circulating Dec. 8 a bill that would vest jurisdiction over rogue websites with the International Trade Commission (236 PTD, 12/8/11).

Sen. Ronald L. Wyden (D-Ore.) and Rep. Darrell E. Issa (R-Calif.), both of whom oppose SOPA and the Protect IP Act, were among the lawmakers that are proposing the new bill, which is being called the OPEN Act.

In a statement, the lawmakers suggested that the creation of a judicial remedy to combat online infringement would be too narrow in nature and would inevitably neglect “important issues pertaining to cybersecurity and the promotion of online innovation, commerce and speech.” Instead, the lawmakers said that these issues should be addressed “as a matter of regulating international commerce,” where “we are able to take all of these factors into account.”

The ITC, which already presides over disputes regarding the importation of goods that were allegedly manufactured in violation of a patent owner's rights, could, if petitioned by a U.S. rightsholder, “issue a cease-and-desist order against foreign websites that provide illegal digital imports and/ or facilitate the importation of counterfeit goods,” the proposal said.

SOPA Markup Set for Dec. 15

The House Judiciary Committee will take up H.R. 3261 Dec. 15.

Issa, one of the members on the committee, released a statement Dec. 13 saying, “The manager's amendment retains the fundamental flaws of its predecessor by blocking Americans' ability to access websites, imposing costly regulation on web companies and giving Attorney General Eric Holder's Department of Justice broad new powers to police the internet.”

In the same statement, Issa said that he would formally introduce the OPEN Act Dec. 14.


Full text of the manager's amendment can be found at http://pub.bna.com/ptcj/3261ManagersAmendment.pdf    

Full text of the original bill can be found at http://pub.bna.com/ptcj/HR3261Oct26.pdf