The Center for Democracy and Technology, Electronic Frontier Foundation, Electronic Privacy Information Center, New America Foundation and other advocacy groups urged the Obama administration on Thursday to open up negotiations pertaining to a proposed Anti-Counterfeiting Trade Agreement. The groups wrote to President Obama expressing "deep concerns about the lack of transparency" surrounding the pact, which is the focus of a meeting in Seoul, South Korea this week.
In their letter, they reference Obama's day one memo pledging increased openness and participation in executive decision-making and directing agencies to "take affirmative steps to make information public." The continuing Open Government Initiative indicates a strong commitment to applying the principles in practice but multiple aspects of ACTA fail to meet those standards, they said. Read the text of the letter here (PDF).
Senate Judiciary Chairman Patrick Leahy said members of his committee have their work cut out for them as winter recess nears. His panel made a big stride Thursday when it passed a pair of data security bills (see CongressDaily's PM Edition for details) and several measures that have cleared the committee and await floor action. Leahy said the Senate needs to take up a bill that would modify and reauthorize expiring provisions of the USA PATRIOT Act and the Satellite Home Viewer Act before they expire Dec. 31.
He noted he has been working with Senate Minority Whip Jon Kyl and other leaders from both parties to help make that happen. Leahy said last month that he wants to work with Majority Leader Harry Reid to schedule, before the end of the year, floor debate on legislation that would overhaul the U.S. patent system. The Obama administration has thrown its support behind the bill. Patent and Trademark Office Director David Kappos recently told a group of IP attorneys that a legislative fix is needed immediately.
A dozen senators, including Sens. Sam Brownback, R-Kan., Tom Coburn, R-Okla., and Senate Finance ranking member Charles Grassley, sent a letter to Reid and Minority Leader Mitch McConnell stating the bill needs more work before it is brought to the floor. Judiciary ranking member Jeff Sessions and Kyl have questioned the bill's approach to challenging a patent after it is granted.
Texas Reps. Gene Green, a Democrat, and Mike Conaway, a Republican, wrote to House Judiciary Chairman John Conyers on Wednesday asking to be included in any discussions regarding legislation that would force AM and FM radio stations to pay a new fee to performers and record labels. Conyers and Senate Judiciary Chairman Patrick Leahy have requested that music and broadcasting executives come together on Capitol Hill Nov. 17 to begin two weeks of negotiations.
Green and Conaway sponsored a resolution opposing the bill and it has garnered more than 250 backers. Sen. Blanche Lincoln, D-Ark., introduced an identical proposal. "We have serious concerns that legislation imposing a new royalty on local radio stations, particularly in this economic climate, will be tremendously harmful to radio stations and their employees, local communities that rely on radio, and recipients, such as charities and non-profits, that receive free airtime for their causes," Green and Conaway wrote.
The latest round of negotiations on the proposed Anti-Counterfeiting Trade Agreement has begun in Seoul, South Korea with little light shed on where the talks are headed. U.S. Trade Representative Ron Kirk and his team have tried to communicate the message that while they value transparency, keeping the details of the trade deal under wraps is essential. The USTR allowed some industry and advocacy groups to view documents as negotiators prepared for this meeting but notable watchdog groups were left out and took issue with the mandate that those privy to the text had to sign non-disclosure agreements.
One such group, Knowledge Ecology International, slammed the USTR for allegedly handpicking those who reviewed the draft and filed a Freedom of Information Act request asking for "all records at USTR on the topic of the policy and practice of USTR regard the transparency of trade negotiations, including but not limited to [ACTA]." This week KEI spearheaded a letter to President Obama calling on the process to be opened up for public debate. A number of individuals and international advocacy groups signed the petition, which was circulated online.
The ACTA effort began nearly two years ago, and negotiators initially wanted to finalize the deal before the end of former President George W. Bush's term. Kirk told a crowd at the U.S. Chamber of Commerce in September that he couldn't put a firm date on when the pact would be complete. Internet piracy will be "a very strong part of our dialogue," Kirk said, noting that it would be helpful if industry stakeholders could arrive at "a more harmonious position" on the topic.
Former U.S. Assistant Trade Representative Victoria Espinel who was tapped in September by President Obama to serve as the first White House intellectual property enforcement coordinator will appear before the Senate Judiciary Committee on Wednesday. Espinel, who taught at George Mason University after leaving USTR in the Bush administration, is expected to easily win approval of the panel, which is considering an appeals court judge and several district judges the same day.
Senate Judiciary Chairman Patrick Leahy received letters in support of Espinel's nomination from a range of stakeholders including the Copyright Alliance, National Music Publishers' Association, American Intellectual Property Law Association, International Trademark Association, Motion Picture Association of America, U.S. Chamber of Commerce and others.
The Chamber called Espinel's confirmation "an important step towards fulfilling the promise of the PRO-IP Act," an IP enforcement bill that Congress passed and Bush signed into law last year. MPAA Chairman Dan Glickman called her an "excellent choice" for the office and said his experience with her at USTR was top notch. AIPLA hailed her "impressive and substantive background."
Hollywood studios are asking the FCC to make protecting creative content online a core principal of its national broadband plan. In a late Friday filing, the Motion Picture Association of America wrote that if the plan -- due to Congress in February -- is to serve as a roadmap for high-speed Internet service for all Americans, the government must recognize the role content plays in driving adoption of new technologies. The filing came on the heels a September FCC workshop that featured testimony from MPAA Chairman Dan Glickman and Paramount Pictures Chief Operating Officer Frederick Huntsberry.
"Compelling content is an essential ingredient in the consumer Internet experience and a key driver of broadband adoption. Inadequate respect for creative rights online will impede the rollout of creative new content offerings, undermining the Commission's, Congress' and the administration's goal of ubiquitous national broadband," the MPAA said in its filing. "The government cannot let the anonymity of the Internet become a cloak behind which people think that unlawful conduct can continue unabated."
Read the MPAA's full filing here.
A high-tech watchdog group is circulating a petition to President Obama regarding transparency of the proposed Anti-Counterfeiting Trade Agreement. Knowledge Ecology's letter asks that negotiations regarding the intellectual property enforcement pact with a handful of U.S. trading partners be opened up for more public vetting. IP protection is critical but is also "a complex area where the 'solutions' to the enforcement issues are often controversial," the letter states.
Unlike nearly all other multilateral and plurilateral discussions about IP norms, the ACTA negotiations have been held in deep secrecy, the document argues. That has led to "a chorus of criticism," which prompted the Office of the U.S. Trade Representative to offer some individuals access to documents in the negotiation after signing a non-disclosure agreement. Knowledge Ecology was not asked to review the paperwork.
The letter goes on to state that "the only rationale for keeping the proposed ACTA text from the public is to suppress criticism and critical thinking about the norms that are being proposed." The group calls it "Orwellian and an insult to our intelligence" to claim the secrecy of the ACTA text has anything to do with national security. Read more here.
Computer giant Hewlett-Packard has pulled out of the Coalition for Patent Fairness over concerns that legislation currently moving through Congress does not go far enough to curb what some high-tech firms believe are excessive damages in patent infringement lawsuits. HP, which was a prominent member of the ad hoc group, is still very supportive of patent reform and will continue to lobby for strong damages language, sources familiar with the issue told Tech Daily Dose.
The so-called "gatekeeper" compromise struck by Senate Judiciary Chairman Patrick Leahy and Sens. Dianne Feinstein, D-Calif., and Arlen Specter, D-Pa., helped ensure the bill's passage out of committee in April but if it were to become law, HP believes it would be "a huge missed opportunity," the source said. Leahy and Senate Majority Leader Harry Reid are working to bring the bill to the floor before the end of the year. The House Judiciary Committee has not yet moved forward on its bill and, as introduced, retains the more controversial damages language.
Industry groups like CPF, which span multiple years and sessions of Congress, gain and lose members due to variations in strategy, individual companies' budget priorities and other reasons. Amazon.com, Time Warner, Visa and Verizon were members of CPF at one point but are no longer listed on the group's Web site. Google was not an original member of the coalition but has since signed up.
For its part CPF wants "the strongest possible provisions on all elements," including damages, a spokesman told CongressDaily last week.
NBC-Universal general counsel Rick Cotton, who chairs the U.S. Chamber of Commerce's Coalition Against Counterfeiting and Piracy, on Tuesday lauded legislation that would bolster intellectual property enforcement resources and tools for Customs and Border Protection and Immigration and Customs Enforcement. He testified at a Senate Finance Committee hearing on the bill that Chairman Max Baucus and ranking member Charles Grassley introduced in August. CongressDaily's AM Edition reported the bill could move through the committee before Thanksgiving.
Overall, CBP must ensure that U.S. innovation and creativity "is used to produce jobs here and is not stolen abroad -- endangering our economy, killing our jobs, threatening our citizens' health and safety, and nourishing organized crime," Cotton said in his written testimony. He went on to call IP theft "a stealth job killer" and warned that if the U.S. fails to take bold steps now, the country will be committing "slow-motion economic suicide."
The IP provisions of the broader CBP reauthorization bill would, among other things, establish an IP coordination center within ICE to prevent importation or exportation of pirated and counterfeit goods. The measure also strengthens CBP's targeting efforts to detect goods that violate IP rights and requires CBP to dedicate port personnel with primary responsibility for enforcing those rights. The bill requires strategic plan to decide where best to position those agents but in the meantime would assign at least one full time IP specialist at each of the top 10 ports.
Read the full CongressDaily story here (subscription required).
Commerce Secretary Gary Locke and U.S. Trade Representative Ron Kirk will travel to Guangzhou and Hangzhou, China, next week to co-chair the 20th session of the U.S.-China Joint Commission on Commerce and Trade, according to a Commerce Department press release. While there, Locke will stress the importance of strong intellectual property rights protection and enforcement around the world. The JCCT, established in 1983, is the main forum for addressing bilateral trade matters and promoting commercial opportunities between the United States and China.
On Tuesday, Locke will deliver a keynote address at an IP forum and meet with university students to discuss the criticality of IP rights for the next generation of innovators and entrepreneurs. On Wednesday, he will host roundtable meeting with energy companies to discuss opportunities and barriers to entry for U.S. firms in China's clean energy market. Thursday brings the JCCT ministerial meeting with Kirk and Chinese Vice Premier Wang Qishan. For more information click here.
Duke Law School professor Arti Rai quietly reported for work at the Patent and Trademark Office on Monday as administrator for external affairs, according to sources within the agency. Rai, an expert in patent law and legal issues facing the biopharmaceutical sector, will make her maiden speech at an award ceremony for collegiate inventors in Chicago on Tuesday. She will talk about the importance of a strong intellectual property regime, economic recovery and job growth. At PTO, Rai will oversee domestic and international policy and intergovernmental relations and will be a strong voice for the agency as Congress advances legislation to overhaul the U.S. patent system.
Rai has close ties to the administration. She was a classmate of President Obama's at Harvard Law School and served on his transition team as a member of the agency review team on science, technology, space, arts and humanities. Computing Technology Industry Association Director for Global IP Chris Katopis, who previously served as PTO deputy administrator for external affairs, said Rai is a "provocative choice" for the administrator job since she hails from academia, which is seen as "notoriously anti-patent."
Lawmakers backing a stalled patent overhaul bill are looking at fresh ways to move the measure by the end of the year, despite GOP opposition, CongressDaily reported Friday. The bill, which cleared the Senate Judiciary Committee in April, seeks to address the Patent and Trademark Office's chronic application backlog and improve internal efficiencies. It would also change the protocol for challenging patents - a move that has divided small innovators, the life-sciences sector and the IT industry.
Senate Judiciary Chairman Patrick Leahy said Thursday he wants to work with Majority Leader Harry Reid to schedule debate before the end of the year. Leahy made his comments the same day that PTO Director David Kappos told the American Intellectual Property Law Association's annual meeting that a legislative fix is needed immediately. "Not everyone is getting everything they want" in the bill, Kappos said, but it is a "major positive step" for the stakeholders involved.
But on the same day, 12 senators, including Sens. Sam Brownback, R-Kan., Tom Coburn, R-Okla., and Senate Finance ranking member Charles Grassley, sent a letter to Reid and Minority Leader Mitch McConnell stating the bill needs more work before it is brought to the floor. Judiciary ranking member Jeff Sessions and Minority Whip Jon Kyl have questioned the bill's approach to challenging a patent after it is granted and want to modify the language.
Read the full story here (subscription required).
Sen. Orrin Hatch, R-Utah, on Wednesday called for Congress to "act in the best interest of the economy" and Patent Trademark Office users by permanently ending fee diversion at the agency. Such a change would let the PTO set fees and recover costs, which Commerce Secretary Gary Locke and PTO Director David Kappos have said would better address the agency's operational funding needs in a time of economic uncertainty.
Hatch's remarks came at a ceremony recognizing the PTO's grant of the 600,000th design patent to Goal Zero, a subsidiary of Provo Craft and Novelty, and a small business located in his home state. The patent was issued for the design of a battery system, which works in conjunction with a solar briefcase that recharges in the sun.
Lawmakers should improve the quality of patents at the front end so as to avoid costly and counterproductive litigation that stifles innovation at the back end, Hatch added. "Improving patent quality and reducing litigation uncertainty are the central tenets of the bipartisan congressional mandate for patent reform," he said, arguing that consensus is possible "but it will take willing partners from within Congress, the administration, and the patent community."
A group of minority groups and civil rights organizations on Tuesday wrote to Senate Judiciary Chairman Patrick Leahy in opposition to legislation he has introduced that would force AM and FM radio stations to pay new fees to performers and record labels. The bill, which the groups argue would be detrimental to minority-owned stations and the communities they serve, could be teed up for a vote by the Judiciary Committee on Thursday. Some have estimated that the measure would throw at least a third of minority broadcasters into bankruptcy.
Among those signing onto the letter include: the Black College Communication Association, the Hispanic Institute, International Black Broadcasters Association, Telecommunications Professionals, Latinos in Information Sciences and Technology, Lawyers' Committee for Civil Rights Under Law, Minority Media and Telecommunications Council, National Black Chamber of Commerce, National Association of Hispanic Journalists, Spanish Broadcasters Association and UNITY: Journalists of Color, Inc.
A similar measure sponsored by House Judiciary Chairman John Conyers underwent a major rewrite before his committee took up the bill. The version that ultimately passed his panel included a number of carve-outs aimed at appeasing small and minority owned stations and ultimately won the support of the NAACP, Leadership Conference on Civil Rights and a number of unions. It remains to be seen what changes could be made to Leahy's bill in hopes of calming the fears of broadcasters.
A day after watchdog group Knowledge Ecology International slammed the Office of the U.S. Trade Representative for allegedly handpicking a group of mostly industry executives to review and provide feedback on a controversial section of a proposed Anti-Counterfeiting Trade Agreement, the watchdog has filed a Freedom of Information Act request asking for "all records at USTR on the topic of the policy and practice of USTR regard the transparency of trade negotiations, including but not limited to [ACTA]."
KEI Director Jamie Love's appeal for information, which spans Jan. 1, 2009 to today, will be used "to evaluate the degree to which the USTR is providing the public timely and relevant information about important norm setting activities in the area of intellectual property right rules and practices." Among the documents expected to be relevant are the communications within USTR and between USTR and other federal agencies, the White House and the Congress, and between USTR and the private sector, on the policies regarding transparency of trade negotiations, he said.
In a same day e-mail to USTR IP negotiator Stan McCoy, Love asks whether the current ACTA text, which will be the focus of a November meeting in Seoul, South Korea, makes it clear that there is no obligation to stop goods at borders in cases where there is legitimate parallel trade of products. A global IP treaty known as TRIPS has a carve-out for such cases. "If we could review the text, as apparently every corporate lobbyist in Washington, D.C. can do, we might know the answer to this question," Love added. See original Tech Daily Dose post on this topic here.
A team from the Office of the U.S. Trade Representative will head to Seoul, South Korea, early next month to resume talks with a handful of trading partners on a proposed Anti-Counterfeiting Trade Agreement. A portion of the discussion will focus on transparency issues since negotiators have been dogged for months over the secrecy of their meetings and a dearth of viewable treaty text. See CongressDaily's story here (subscription required).
In preparation for the latest round of talks, USTR broadened its consultations to include views from domestic stakeholders with expertise on Internet and digital issues. Officials from nongovernmental organizations and industry leaders in intellectual property and technology offered their insights -- after signing nondisclosure agreements. Watchdog group Knowledge Ecology International sent a Freedom of Information Act request for a list of all individuals who signed what amounts to a gag order.
USTR responded late last week with the roster of 42 Washington insiders who saw a highly controversial draft chapter pertaining to Internet piracy. Those who viewed the document include executives from the Business Software Alliance, Google, Dell, Intel, eBay, Verizon, Consumer Electronics Association, News Corp., Sony Pictures Entertainment, and Time Warner. Representatives from think tanks like the Center for Democracy and Technology and Public Knowledge were also privy to the proposal.
The Library of Congress on Thursday released the fifth in a series of landmark studies that highlight challenges facing cultural institutions that specialize in the preservation and public access to historic recorded sound materials. The absence of a federal copyright law to protect pre-1972 recordings is inhibiting the preservation and accessibility of much of America's aural heritage because that audio is governed by a confusing array of state laws, common law and judicial decisions, the library said.
The paper, commissioned by Congress and published by the Council on Library and Information Resources, examines copyright laws in 10 states related to sound recordings released before 1972. It authors conclude that state anti-piracy laws alone do not define the legal uses of pre-1972 recordings. Legal uses of the recordings are also impacted by common law copyright, unfair-competition laws, rights of privacy, and federal copyright law related to underlying works, such as musical compositions. Read the full report here.
The New York judge overseeing Google's pending $125 million settlement in a class-action lawsuit involving book authors and publishers has set Nov. 9 as the date by which the parties must provide a revised proposal for the court's preliminary approval. U.S. District Judge Denny Chin, who was nominated by President Obama on Tuesday for a spot on the U.S. Court of Appeals for the Second Circuit, acknowledged at a Wednesday hearing that the original deal was not longer viable.
The arrangement agreed to by the Google, the Authors Guild and the Association of American Publishers was criticized by Internet industry competitors, librarians and public interest groups. It also got the Justice Department's attention and was the focus of a congressional hearing. The Internet Archive's Peter Brantley, who co-founded the Open Book Alliance to oppose the initial Google settlement, said whatever the parties offer up next month must be subject to "full review and scrutiny" by those who have spoken out.
Publishing giants like Reed Elsevier, Dow Jones and the New York Times will face off against freelance authors Wednesday as the Supreme Court considers whether federal judges have the power to approve settlements in copyright fights, CongressDaily reports. The case stems from a New York court's approval of an $18 million settlement of a class-action brought by writers who argued their work was improperly reproduced for electronic distribution.
Absent from the bench will be Associate Justice Sonia Sotomayor, who gave no reason for her recusal. As a district court judge in 1997, she heard a similar case brought by individual freelancers. Sotomayor sided with publishers, but the 2nd U.S. Circuit Court of Appeals for the reversed her decision on the basis that the trial court lacked jurisdiction over claims relating to unregistered works. The Supreme Court upheld the appellate ruling, 7-2.
In the current case, a district court approved the settlement, but the 2nd Circuit, citing federal law limiting copyright lawsuits to those who have registered their works, ruled that the lower court had no jurisdiction and should not have approved the deal. Publishers want a reversal of the appellate court's ruling, and the American Intellectual Property Law Association filed a brief supporting the publishers. Read the full preview story here (subscription required) and look for more coverage in CongressDaily later in the day.
Patent and Trademark Office Director David Kappos reiterated on a call with reporters Tuesday the Obama administration's support of a Senate bill that would make big changes to the U.S. patent system. Kappos said that while no industry stakeholders have gotten exactly what they want out of the measure, "it moves us forward [and] that is better than the status quo." Major high-tech and pharmaceutical companies spent months divided over the bill's handling of how damages are assessed in infringement lawsuits and recent debate has focused on administrative procedures for challenging granted patents.
Commerce Secretary Gary Locke wrote to Senate Judiciary Chairman Patrick Leahy on Monday saying the bill "incorporates the essential elements of patent reform," but lawmakers should go further to address related issues as it heads toward the floor. Leahy, whose panel approved the measure in April, said he wants to work with Majority Leader Harry Reid to tee the bill up for a vote before the end of the year. Read more in CongressDaily here (subscription required).
On the same teleconference, Commerce Department General Counsel Cameron Kerry, who is the younger brother of Sen. John Kerry, D-Mass., told reporters that provisions of the Leahy bill are "important to jump-starting the economy again and getting innovation going again." He said the bill is "long overdue" and, if passed, would help the PTO "make the American patent system function the way that it ought to."
Legislation that would force AM and FM radio stations to pay fees to performers and record labels whose songs they broadcast has been added to the Senate Judiciary Committee's mark up agenda for Thursday. The controversial bill, sponsored by Judiciary Chairman Patrick Leahy, was the focus of an August hearing. A similar measure passed the House Judiciary Committee in May after key members added carve-outs intended to help small broadcasters cope with the charge. Resolutions have been introduced in the House and Senate opposing the fee.
It is unlikely that the Senate bill will see action this week because of a rule that allows any Judiciary Committee member to postpone consideration of legislation for one week after it is added to the line up for the first time. The panel has its hands full with other issues including legislation to extend and modify provisions of the USA PATRIOT Act; a bill to protect reporters who decline to reveal confidential information or sources; and a bill that would bar pharmaceutical companies from making deals with other drug companies to halt production of generic drugs.
The final round of friend-of-the-court briefs have been filed in a case pending before the Supreme Court that will mark the first time since 1981 the panel has ruled on the types of innovations covered by the U.S. Patent Act. The high court agreed in June to consider what types of business methods qualify for patent protection after the Federal Circuit Court of Appeals upheld a decision by the Patent and Trademark Office's appeals board. The case has sweeping ramifications for the software, biotechnology and financial services sectors.
At issue is the PTO's rejection of an application by inventor Bernard Bilski, who tried to patent what some believe is an abstract idea to reduce risk in buying and selling commodities. The case has generated immense interest in the high-tech and intellectual property communities. Among those submitting briefs were the Electronic Frontier Foundation, Computer and Communications Industry Association, American Bar Association, Bloomberg, and Microsoft. Click here to read the Patently-O blog's summaries of amicus briefs.
As the Commerce Department works on the near-term release of a letter providing the Obama administration's views on a Senate bill aimed at overhauling the U.S. patent system, key Republicans are pressing Senate Judiciary Chairman Patrick Leahy and ranking member Jeff Sessions to resist proposals they believe could weaken the measure.
Sens. Orrin Hatch, R-Utah; Mike Crapo, R-Idaho; James Risch, R-Idaho; Michael Enzi, R-Wyo.; and Robert Bennett, R-Utah, asked them to build on "careful compromises" reached when the panel approved the bill in April, 15-4. At the time, Leahy lost the support of Hatch, a key ally who was upset the amended version failed to address the issue of "inequitable conduct" claims at the Patent and Trademark Office.
Hatch, who chairs the Senate Republican High-Tech Task Force, said Wednesday that he voted against the bill because he "wanted to make sure patent reform was done right." Nonetheless, he said there were good provisions in the bill and he wants to make sure Leahy and Sessions are "vigilant in preserving what has been achieved." Stakeholders are divided over the bill's approach to administratively challenging a patent's validity after it is granted.
Read the full story in CongressDaily's AM Edition here (subscription required).
House Foreign Affairs Chairman Howard Berman capped off Wednesday's U.S. Chamber of Commerce intellectual property summit by touching on a range of issues -- from patents to copyrights to trademarks. How does the former head of the now defunct Judiciary Courts, the Internet, and Intellectual Property Subcommittee keep abreast of the flurry of IP activity while heading up a panel with broad jurisdiction over international and diplomatic issues? "I can walk and chew gum at the same time," he said.
Berman said he hoped that the Senate will act on a version of a foreign relations reauthorization bill that would include language to increase resources and training for enforcement of IP rights. A bill he introduced, which overwhelmingly passed the House in June, would require the Secretary of State to appoint 10 new IP attachés to serve in embassies or other diplomatic missions with priority placement given to countries with particularly egregious IP regimes.
On the ongoing debate over whether and how to overhaul the U.S. patent system, Berman said he was hopeful that legislation could move forward. He noted that the Senate is poised to pave the way in the 111th Congress. Berman also said President Obama's nomination of the first White House IP enforcement coordinator last week should lead to "a more coherent and comprehensive federal policy." Rigorous enforcement and a focus on digital piracy should be at the top of that office's agenda, he said.
Patent and Trademark Office Director David Kappos shared with employees on Wednesday a package of proposed initiatives that he hopes will move the agency down the path toward a more efficient examination environment. The pending plan would give examiners more time for a first action on the merits; time for examiner-initiated interviews with lessened credits for requests for continued examination; and providing consistent credits for transferred or inherited amendments.
Process changes would increase work credit certainty for examiners, increase fairness to applicants, and balance the load on IT systems, he said in a PTO newsletter. The proposal, drafted by PTO managers and union representatives, includes measures that will help examiners to do a high-quality first action, and shift resources from a focus on examiner recertification to front-end quality improvements, he wrote. Examiner briefings on the proposal will begin on Monday, Oct. 5.
U.S. Chamber of Commerce President Tom Donohue urged the Senate on Wednesday to "hurry up and confirm" former U.S. Assistant Trade Representative Victoria Espinel who was tapped last week by President Obama to serve as the first White House intellectual property enforcement coordinator. The Senate Judiciary Committee first must receive a completed questionnaire that details her background and experience and then a hearing can be scheduled. Espinel, who is highly regarded on Capitol Hill, within industry, and among international IP policy arenas, is expected to easily win confirmation.
"I'm calling on the administration to take the next logical and necessary step," Donohue said during a keynote at a Chamber-sponsored summit. "Work with the business community and Congress to create a bold IP strategy." Such a plan is required under the 2008 legislation that created the IP czar position, he said. The White House must ensure that, once confirmed, Espinel will have "the resources and authority to get things done."
Donohue also pressed the U.S. government to remain strong on protecting the IP behind green technologies as negotiators plan for the UN Framework Convention on Climate Change in Copenhagen, Denmark, in December. At that meeting, countries will try to reach agreement on how to reduce greenhouse gas emissions but some governments want carve-outs that Donohue said could diminish incentives for U.S. manufacturers. "We must reject those claims that IP rights are a barrier to climate change innovation," he said, arguing that compulsory licensing could endanger a million jobs by 2020.
A new law taking effect this week in the Bahamas, which would restore copyright protection for U.S. pay television content, is a small but important illustration of how ensuring respect for intellectual property and implementing trade commitments can create markets for American innovators, U.S. Trade Representative Ron Kirk said Wednesday. The new law would provide legal protection against unauthorized broadcasts of American programming and, if properly implemented, could mean "that literally overnight, American cable companies will have a new export market for their shows."
Kirk told a U.S. Chamber of Commerce IP conference that his team is committed to creating similar opportunities with the country's larger trading partners as well as smaller ones. He said this can be accomplished with the help of tools like the USTR's "Special 301" process, which has evolved into a year-round affair, not just an annual report card on the world's worst IP offenders. The USTR on Wednesday launched five out-of-cycle Special 301 reviews that had been announced in April.
"We are committed to using the Special 301 process to highlight the need for reforms to address new challenges like Internet piracy, as we did this year with Canada, and also using the process to recognize meaningful progress, as we did this year with Korea," Kirk said. He added that his is committed to robust and results-oriented dialogues to make progress on IP issues. In the coming weeks, Kirk will travel to China and India for bilateral meetings and IP will be an important component of those talks.
For more coverage of Kirk at the Chamber's IP summit, read CongressDaily's PM Edition.
A group representing NBC, News Corp., Time Warner and other content providers is circulating nationwide a letter to President Obama and Vice President Biden asking the administration to pursue policies supportive of creators' rights. The broader dissemination of the document, which will be sent by the Copyright Alliance to the White House this fall, follows a swift internal response by members. Within a few days, the document garnered nearly 7,000 electronic signatures, officials said in a press release.
With artists encouraging participation within their personal networks on blogs and Twitter feeds, the letter already has been signed by creators in all 50 states and representing a full spectrum of creative disciplines. Signers include authors, photographers, songwriters, graphic designers, filmmakers, musicians, publishers, jewelry designers, Web designers, photojournalists, illustrators, video game developers, architects, cartoonists, composers, playwrights, animators and others.
"Increasingly, creators are finding their work misappropriated, reproduced and distributed without their knowledge, consent or benefit by those who believe intellectual property should be free for the taking," Alliance Outreach Director Lucinda Dugger said. Alliance Executive Director Patrick Ross added he believes the administration understands and values the contributions creators make but more needs to be done. "We'll be watching with optimism," he said. The letter is available here.
When President Obama tapped George Mason University professor Victoria Espinel as the first White House intellectual property enforcement coordinator Friday, lawmakers and industry stakeholders let out a collective sigh of relief. The announcement was months in the making, and Espinel, who previously served as assistant trade representative for IP, had been considered the top candidate for the job for some time.
One reason for the delay was that administration officials were conflicted over where to put the IP czar. Eventually they settled on OMB, after ruling out the Domestic Policy Council, National Economic Council, USTR and the Office of Science and Technology Policy, sources familiar with the process said. OMB oversees strategic planning, interagency coordination and budgeting, and it is seen as a successful coordinator of programs that span multiple agencies.
The fact that Espinel, who is expected to easily win Senate confirmation, would land at OMB is ironic, since that is where 2005 legislation offered by Sens. Evan Bayh, D-Ind., and George Voinovich, R-Ohio, placed the head of a proposed IP enforcement network. At the time, the idea was panned by critics, who thought OMB would be a peculiar locale for the post. Read the entire "Issue Of The Week" from CongressDaily's TechCentral here (subscription required).
[Updated 4:11 p.m.] The White House announced Friday its long-awaited intellectual property enforcement coordinator. Victoria Espinel, who previously served as assistant trade representative for IP, has been the top candidate for months, but the administration was unsure of where to put her. Officials reportedly ruled out placement within the Domestic Policy Council, the National Economic Council and National Security Council, and now the Senate-confirmed IP czar will be housed at OMB. One of the IP coordinator's first agenda items will be drafting a strategic plan to identify "structural weaknesses, systemic flaws or other unjustified impediments" to cracking down on IP crime, according to the 2008 legislation that created the job (CongressDaily / subscription required).
Here's the official White House personnel announcement:
More than 20 lawmakers are urging Justice Department antitrust chief Christine Varney and FTC Chairman Jon Leibowitz to view recent European antitrust rulings with a critical eye and weigh the impact of those decisions on U.S. high-tech firms such as Intel, Google, Microsoft, IBM and Qualcomm. Their effort comes on the heels of the European Commission's $1.45 billion judgment against Intel for excluding competitors from the market for chips known as x86 central processing units.
Sept. 18 letters to Varney and Leibowitz, spearheaded by Oregon Reps. Earl Blumenauer, a Democrat, and Greg Walden, a Republican, argue the Intel ruling "is the latest evidence of a troublesome trend in Europe toward regulatory protectionism." Other successful U.S. firms have faced hefty fines, are under investigation, or possibly face scrutiny from the Commission's competition directorate, they said. The Intel decision "ignores the reality of a highly competitive marketplace," they wrote in the document initially circulated on the Hill this summer.
Intel, which is the subject of an FTC investigation, was a major contributor to the 2008 races of Blumenauer and Walden and employs more than 15,000 people at Oregon facilities, making it the state's largest private employer. The company also has a workforce of several thousand in New Mexico. Democratic Reps. David Wu of Oregon, Harry Teague of New Mexico, Rush Holt of New Jersey, House Science Chairman Bart Gordon and others signed the letter.
As radio executives gather in Philadelphia this week for the National Association of Broadcasters' annual Radio Show, attendees will likely get an earful about legislation moving through Congress that would impose new fees on AM and FM stations. The NAB has waged war against a pair of House and Senate bills, claiming they would impose an unfair burden on an already cash-strapped industry. But music stakeholders argue the bills would bring AM and FM in line with Internet, cable and satellite radio services, which already pay performers.
An NAB spokesman said Tuesday that support for "free and local radio" continues to grow despite the music industry-led effort. The group noted that 251 House members and 25 senators have signed onto resolutions opposing what they believe is a tax on local radio. Sen. Mary Landrieu, D-La., and Sen. John Thune, R-S.D., along with Reps. Dennis Cardoza, D-Calif.; John Boccieri, D-Ohio; Brian Baird, D-Wash.; Joe Sestak, D-Pa., and Dan Lungren, R-Calif., were the most recent to back the resolutions.
Meanwhile, proponents of the legislation are turning up the heat on one radio giant. The MusicFirst Coalition said Wednesday that two Washington, D.C. area Clear Channel stations -- country station WMZQ and WIHT, "Hot 99.5," -- failed to comply with public disclosure rules for advertisements opposing the Performance Rights Act. MusicFirst argued the stations played NAB spots but an inspection of their public filings found no record of the broadcasts and nothing about the stations' opposition to the legislation.
The Justice Department weighed in on Google's plan to create the world's largest digital library and bookstore late Friday, telling a New York federal court that it should press for changes to a pending $125 million deal in a class-action lawsuit involving the Internet giant, authors and publishers. The government said it has concerns about the arrangement, which stemmed from a 2005 suit, but a properly structured deal could have societal benefits.
DOJ told U.S. Judge Denny Chin who has scheduled a hearing for Oct. 7, that the parties should consider the following changes: imposing limitations on open-ended provisions for future licensing; eliminating potential conflicts among class members; providing additional protections for unknown rights holders; addressing concerns of foreign authors and publishers; eliminating joint-pricing mechanisms among publishers and authors; and providing a way for Google's competitors to gain comparable access.
The U.S. government's top copyright official warned last week that the settlement would encroach on Congress' role in setting copyright policy and would let Google "engage in a number of indisputable acts of copyright infringement." Register of Copyrights Marybeth Peters testified alongside fans and foes of the proposal during a House Judiciary Committee hearing. Google Chief Legal Officer David Drummond said the deal complies with copyright law and will lower barriers to entry for competitors.
Legislation slated to come before the House Judiciary Committee on Wednesday will reflect the end to a copyright feud between cable television and content providers, Democratic aides told CongressDaily earlier this week. Under the deal, cable companies would give the Copyright Office $85 million over five years to cover "phantom signals" -- transmissions that are not viewable by consumers but nevertheless necessitate payment under a 2008 decision by the Copyright Office. Hollywood studios would get a portion of the money. The arrangement also includes money for past obligations, sources said of the deal reached by the National Cable and Telecommunications Association and the Motion Picture Association of America.
Both groups were hesitant to comment ahead of Judiciary Chairman John Conyers' introduction of the broader bill, which would reauthorize sections of the Satellite Home Viewer Act that expire Dec. 31. MPAA Chairman Dan Glickman issued a statement lauding Conyers and his staff for bringing the parties together to reach a consensus. "This is a good agreement for consumers who enjoy entertainment programming, the people who create that programming and the cable systems that retransmit it," he said. NCTA had argued that its members should not have to pay for content that subscribers cannot access but is transmitted as a result of cable company consolidation.
Read the full story in CongressDaily here. Senate Judiciary Chairman Patrick Leahy and ranking member Jeff Sessions introduced their version of the reauthorization bill on Tuesday. Read more here. (subscription required)
Even though Senate Finance Committee Chairman Max Baucus and ranking member Charles Grassley are up to their eyeballs in healthcare reform, the U.S. Chamber of Commerce's Coalition Against Counterfeiting and Piracy wants them to keep intellectual property on their radar screen. Coalition Chairman Richard Cotton, who also serves as general counsel for NBC Universal, wrote to the pair Monday commending them for including provisions aimed at bolstering IP protections in their customs and trade enforcement reauthorization bill. The measure was introduced just before August recess.
The legislation would ensure that there is sufficient leadership, resources, and legal tools to sustain effective IP enforcement at the Homeland Security Department, Customs Border Protection, and Immigration and Customs Enforcement, Cotton wrote. The measure would allow those agencies "to work smarter and faster to stop the importation of counterfeit goods while also speeding legitimate commerce." Protecting IP is essential to creating quality jobs and growing the U.S. economy, he stated, noting that IP dependent industries in the U.S. account for more than $5 trillion of the gross domestic product and comprise more than half of all exports.
The U.S. government's top copyright official told lawmakers Thursday Google's pending $125 million deal in a class-action lawsuit with authors and publishers will encroach on Congress' role in setting copyright policy. The settlement, which would embolden the Internet giant's effort to create the world's largest digital library and bookstore, would also let the firm "engage in a number of indisputable acts of copyright infringement," Register of Copyrights Marybeth Peters told the House Judiciary Committee.
Specifically, the settlement awaiting a federal court's blessing would allow Google to sell out-of-print works without rights-holders' consent, Peters said, calling it "an end-run around copyright law as we know it." The deal would also interfere with lawmakers' recent efforts to rework a statute dealing with "orphan works" -- musical tracks, writings, images, videos or other content whose owners cannot be easily found. The Senate passed such a bill last Congress, but a companion bill stalled in the House.
Read the full story in Thursday's CongressDaily PM Edition here and a related story in the AM Edition here that questions whether the Google feud could fuel a renewed push for copyright reform on Capitol Hill (subscription required).
An executive at the Biotechnology Industry Organization on Wednesday said his trade group is hopeful that a Senate bill aimed at updating the U.S. patent system will reach the floor and receive a favorable reaction from the House. BIO Vice President for Governmental Relations Brent Delmonte told reporters that a measure that passed the Senate Judiciary Committee in April is a "fair, responsible compromise." Chairman Patrick Leahy worked with Sens. Arlen Specter, D-Pa., and Dianne Feinstein, D-Calif., to smooth out contentious language that would alter how damages are awarded in patent infringement lawsuits. Previously divided industry stakeholders lauded the changes.
"We hope that type of process will replicate itself [in the House]," he said. House Judiciary Chairman John Conyers introduced a similar bill but his panel has yet to move the measure forward. A House Judiciary Republican aide told CongressDaily recently that there is a "real possibility" that legislation can advance without major changes even though damages language has yet to be tweaked in his chamber. "We'll see over the course of a few weeks whether we can reach a consensus," the aide said. "We've seen great ideas originate on both sides of the Capitol and in both parties," Delmonte said of damages proposals and efforts to adjust the system by which individuals can challenge an issued patent.
The Motion Picture Association of America has asked the FCC for the authority to selectively control output streams to the television entertainment systems of consumers. A Monday letter to the Commission from the trade group's lawyers at Skadden Arps states that such a waiver would "for the first time enable millions of Americans to obtain access in their homes to high-value content" that major movie studios distribute. Consumer watchdog group Public Knowledge has claimed that the request would leave over 11 million individuals who only have analog outputs without any viewing ability.
In meetings with FCC staff and in correspondence, the MPAA has insisted the change would benefit consumers. "Even as innovative technologies bring consumers new and better opportunities to enjoy media content, there is always a lag between when early adopters take advantage of these opportunities and when they become ubiquitous," the letter said, pointing to the fact that as DVD players were introduced for home use, many households still used VCRs. "That some consumers may wait longer to purchase new devices or take advantage of innovative technologies, however, is no reason to deny all consumers the potential benefits of new offerings," the letter said.
The Consumer Electronics Association has opposed the idea. In a November 2008 letter to the Commission, the high-tech trade group said the MPAA has promised vaguely to distribute "some unspecified type and amount of programming" somewhat earlier than they are able to do now. "This promise hardly amounts to an important public purpose," CEA said. The studios' claim that the threat of piracy arising from high-definition TV necessitates the provision of "unfettered control over all inputs on lawfully-purchased HD TV sets," the group said. New FCC Chairman Julius Genachowski has not weighed in on whether he thinks granting the MPAA's request is a good idea or bad idea.
(Hat tip, Ars Technica)
Internet radio company Live365 has filed a lawsuit in the U.S. District Court for the District of Columbia seeking an injunction to prevent any further proceedings by a three-judge panel that determines music royalty rates, officials said late Monday. In the complaint Live365, which has 5 million monthly listeners and more than 270 diverse genres, questions the constitutionality of the Copyright Royalty Board and whether its judges were appointed in violation of the Constitution's separation of powers.
The U.S. Court of Appeals for the District of Columbia recently refused to rule on the CRB's constitutionality in a case brought by licensing firm Royalty Logic. The company had argued the CRB should be forced to vacate its decision in high-profile a proceeding that set the fee structure for webcasters. The panel has convened yet another rate-setting proceeding and music labels, licensing entities, artists, broadcasters and others are expected to spend millions of dollars presenting their cases, Live365 said.
"The constitutional issue is the elephant in the room at the CRB," Live365 CEO Mark Lam said in a statement. "Before any hard-earned artists' royalties and webcaster investments are spent on a potentially invalid royalty setting court, we are just requesting, for the benefit of all parties, to have this significant concern addressed and answered. The National Music Publishers' Association wrote to House Judiciary Chairman John Conyers recently calling for legislation that would make moot any constitutional challenges to the CRB.
The House Judiciary Committee is planning a hearing soon after lawmakers return to Washington this month to examine Internet giant Google's controversial effort to digitize mass quantities of books. Sources on Capitol Hill and within industry told Tech Daily Dose on Tuesday that the hearing could occur next week or the following week in Chairman John Conyers's full committee or the Subcommittee on Courts and Competition Policy, which is chaired by Rep. Hank Johnson, D-Ga.
A New York federal court has scheduled a fairness hearing for Oct. 7 on the $125 million settlement Google reached with publishers last October that lets authors and publishers cash in on the company's plan to display books online and profit from them by selling access to titles and by selling subscriptions to its collection. The Authors Guild and the Association of American Publishers filed a class action lawsuit against Google in 2005. The Justice Department formally acknowledged an investigation into the settlement this summer.
In related news, the National Writers Union wrote to former Vice President Al Gore on Tuesday asking him to use his influence to extend a Sept. 4 date for rights holders to opt out of the Google Books initiative and the Oct. 7 court date on the pending settlement. The deal "threatens to monopolize the access, distribution and pricing of the world's largest digital book database," NWU President Larry Goldbetter wrote. Gore serves as a senior advisor to Google and has a personal relationship with co-founders Larry Page and Sergey Brin.
Update: A House Judiciary spokesman confirmed that a full committee hearing would be held at 10 a.m. on Thursday, Sept. 10.
Almost $2 million in grants for criminal intellectual property enforcement will be sent to law enforcement agencies around the country to improve their ability to investigate, prosecute and prevent intellectual property infringement, the Justice Department announced Thursday. The $1.9 million in grants represent the first wave of funding resulting from the federal Prioritizing Resources and Organization for Intellectual Property Act, which passed Congress and was enacted last year.
"This funding is important in identifying and stopping criminal activity associated with intellectual property piracy. These criminal activities are a threat to our national well being and insult to those who create and develop products, goods and services for the benefit of the general public," said Laurie Robinson, acting assistant attorney general for the Office of Justice Programs.
The grantees include:
Attorney General's Office, Mississippi ($200,000)
Bronx County District Attorney, New York ($43,718)
Chesterfield County, Virginia ($199,919)
City of Los Angeles, California ($199,995)
Los Angeles County Sheriff's Department, California ($200,000)
New York City, New York ($200,000)
North Carolina Department of the Secretary of State ($44,485)
National Association of Attorneys General, D.C. ($450,000)
National White Collar Crime Center, Virginia ($450,000)
Days after visiting with South Korean leaders and praising them for their progress on the intellectual property enforcement front, House Foreign Affairs Chairman Howard Berman admonished the Chinese government for its failure to provide adequate protections for IP rights. Berman and others met Thursday with the National People's Congress Standing Committee Chairman Wu Bangguo, Vice Premier Wang Qishan, NPC Foreign Affairs Chairman Li Zhaoxing, Foreign Affairs Minister Yang Jiechi and Commerce Minister Chen Deming in Beijing.
"China's efforts to stop intellectual property theft have been weak and ineffective - heavy on tough talk but light on implementation," said Berman, whose congressional district houses a number of TV and movie studios. "Hundreds of Web sites provide downloads and links to pirated movies, recordings and games. And sales of 'hard goods' such as illegally duplicated CDs and DVDs continue at close to ninety percent of what they were before China launched its vaunted anti-piracy campaign. It's time for more serious action."
Optical disc plants in China produce and export millions of CDs, DVDs, software and videogames in violation of Chinese law, his office said, while Web services such as Baidu provide direct links to recordings and video games without paying the people who produced them. The country's infamous track record for IP infringement costs U.S. creative communities anywhere from $2.2 to $3.5 billion in each of the past four years, Berman said, urging Chinese authorities to impose stiff fines and meaningful criminal penalties. The country routinely ranks among the world's top offenders in evaluations of global IP like the Office of the U.S. Trade Representative's annual "Special 301" report.
House Foreign Affairs Chairman Howard Berman praised key government officials in South Korea on Tuesday for their efforts to protect U.S. content creators' intellectual property rights. In meetings about the proposed U.S.-South Korea free trade agreement with President Lee Myung-bak, Foreign Minister Yu Myung-hwan and Trade Minister Kim Jong-hoon, Berman emphasized the deal would bolster IP safeguards but said he remains concerned about its potential impact on the American automotive industry.
The trade deal would set penalties for those who abet piracy, including the seizure and destruction of pirated and counterfeit products; protect copyrighted performances on the Internet; and ensure the right of authors, performers and producers of recordings to determine use of copyrighted products. Earlier this year, Korea amended its copyright law to give producers and performers the right to remuneration for the public performance of their sound recordings and to impose obligations on Internet service providers to suspend the accounts of serial copyright abusers.
"South Korean authorities refuse to let the copyright pirates win," said Berman, whose California district is home to a number of major television and movie studios. "Through tightened legislation and international commitments, this country is taking important steps to protect the rights of the creative community, which in turn will safeguard U.S. businesses and jobs." Berman, however, noted that Internet music piracy remains a problem in Korea and urged police and prosecutors to coordinate more closely on enforcement actions.
The World Trade Organization has delivered a victory to the United States in its two-year-old case against Chinese restrictions on importation and distribution of copyright-protected movies, music, books and other entertainment products, CongressDaily reported Wednesday (subscription required). The decision found that the limits on sales of U.S. entertainment wares violated global trade rules. In a statement, Trade Representative Ron Kirk said it would "level the playing field for American companies" and represented a "clear win" for the United States, whose trade relations with China have been increasingly testy.
Motion Picture Association of America Chairman Dan Glickman said the WTO decision "points a way forward that will begin to even the playing field" in an important market. He noted that the Chinese system for distributing U.S. films to Chinese audiences is among the most restrictive and burdensome in the world and the ruling, coupled with a recent announcement that the Chinese government intends to lower market access thresholds for the cultural industry, may be an opening movie studios have been seeking.
Recording Industry Association of America Executive Vice President Neil Turkewitz said the fact that the United States has prevailed does not mean that China has lost. "The adoption of rules that enhance the operation of legitimate markets will inure greatly to the benefit of the Chinese creative community and to Chinese society," he said. Chinese and U.S. creators alike face illicit enterprises that claim at least 80 percent of the physical market and an estimated 99 percent of the online market.
The Obama administration established a strong position on intellectual property in connection with the United Nations Framework Convention on Climate Change at an international working group meeting in Bonn, Germany this week, according to Mark Esper, executive vice president of the U.S. Chamber of Commerce's Global IP Center. Officials affirmed that "no treaty will be agreed upon that undermines or weakens intellectual property rights," Esper wrote on the Chamber's blog.
Nations are preparing for the UN convention in Copenhagen, Denmark, in December where negotiators will try to reach agreement on how to reduce greenhouse gas emissions. Some worry that countries like China and India will push for carve-outs that could diminish the IP rights of U.S. companies like General Electric that manufacture solar and other energy alternatives. "America's position was urgently needed to counteract the anti-IP rhetoric of developing nations," Esper wrote.
Read more on the Chamber's blog here and the latest coverage in CongressDaily here (subscription required).
Intellectual property think tank Knowledge Ecology International has asked the Office of the U.S. Trade Representative to clarify whether the pending Anti-Counterfeiting Trade Agreement will cover patents. "There is considerable confusion on this point," KEI Executive Director James Love wrote Wednesday on the micro-blogging site Twitter. "If the ACTA text was not declared a national security secret by the White House, we could read the text on injunctions and damages," he added.
Officials from the United States, Canada, the European Union, Japan, Mexico and other countries have resumed discussions so they can finalize the pact in 2010, according to Trade Representative Ron Kirk, whose team has been reviewing ACTA and other trade deals. He has vowed to move forward as transparently as possible. Watchdog groups have routinely called for more openness and public participation in negotiations that began under former President George W. Bush.
"This is big government and big business at its worst, creating rules without input or sensitivity to the concerns of consumers, overriding civil rights, undermining privacy, increasing prices to consumers," KEI said in a June statement. "The topics under review are not simple technical issues or directed at organized crime, they are big sweeping changes in our basic freedoms, and underhanded attempts to give lobbyists rules they can't get in a normal democratic setting."
The Corporation for Public Broadcasting will pay digital music royalty collector SoundExchange $ 2.4 million for the term 2011-2015 under a deal made public Tuesday. The agreement, which was completed in late July, is one of several similar arrangements made under the Webcaster Settlement Act, which gave SoundExchange the authority to negotiate alternative rates and terms to the prevailing royalty rates set by the Copyright Royalty Board in 2007.
The deal covers CPB qualified stations, National Public Radio member stations and National Federation of Community Broadcasters participant member stations (along with NPR, American Public Media, Public Radio International and the Public Radio Exchange). "This continuing partnership allows music fans to experience a greater diversity of music, while allowing artists and rights holders the ability to share in revenues generated from music lovers who tune in to hear great recordings," SoundExchange Executive Director John Simson said.
SoundExchange announced recently that it had also made agreements with college broadcasters, SIRIUS-XM and with the National Religious Broadcasters Music License Committee. Terms and rates for each will be published in the Federal Register.
The Justice Department under the Obama administration believes that a digital download of a sound recording does not constitute a performance or a public performance, and thus does not justify the imposition of public performance royalties. The government asserted its position in a federal appeals court's review of a 2007 district court decision that rejected the royalty claim by performance rights organization ASCAP.
Digital Media Association Executive Director Jonathan Potter issued a statement Monday saying he was pleased that DOJ has sided with his group, which represents online entertianment services. He argued that PROs have long sought "to stretch current law by asserting that every transmission of a copyrighted musical work is a 'public performance' under the Copyright Act, regardless of whether that work is ever publicly, or even physically, performed."
The court activity comes as PROs along with composers and songwriters urge Congress to legislate the application of public performance rights to downloads of audiovisual works. The groups recently wrote to lawmakers asking for the change as they consider separate proposals to reauthorize expiring provisions of the Satellite Home Viewer Act and bring AM and FM radio in line with Internet, cable and satellite music platforms that pay performers. Read CongressDaily's recent coverage of this topic here (subscription required).
Grammy Award nominee Sheila E. faced off against Commonwealth Broadcasting Corp. CEO and NAB Radio Board Chairman Steve Newberry on Tuesday afternoon at a Senate Judiciary Committee hearing on legislation that would end a fee exemption afforded to AM and FM radio. Judiciary Chairman Patrick Leahy issued a warning to Newberry and broadcasters at large: "This is legislation that's going to move," Leahy said. "The time to sit down and talk is now." The House Judiciary Committee has already passed its version of the bill. Read the full story in CongressDaily's AM Edition here (subscription required).
Music and broadcasting industry lobbyists have ramped up their rhetoric ahead of Tuesday afternoon's Senate Judiciary Committee hearing on legislation that would end a royalty exemption extended to AM and FM radio, according to CongressDaily's AM Edition (subscription required). The bills Senate Judiciary Chairman Patrick Leahy and House Judiciary Chairman John Conyers introduced in February would bring over-the-air radio in line with cable, Internet and satellite services, which pay performers -- but broadcasters warn some stations could go out of business.
On Monday, the MusicFirst Coalition drew attention to a July CBO report that the group insists puts to rest the National Association of Broadcasters' refrain that the legislation is a "tax" on local radio. The CBO's analysis of the bill that passed Conyers' committee in May found the measure would not cost taxpayers money to implement nor result in federal revenue. A Monday release from the NAB highlighted a Senate resolution that opposes "any new performance fee, tax, royalty, or other charge" on AM and FM stations, which has attracted 23 co-sponsors. A group of 246 lawmakers signed onto a similar House measure. Additionally, 22 House Democrats wrote to Speaker Nancy Pelosi late Friday urging her not to bring the bill to the floor for a vote.
Read complete overage of the Senate Judiciary Committee hearing in Wednesday's CongressDaily AM Edition.
Digital music royalty collector SoundExchange has completed four independent agreements with Sirius-XM, College Broadcasters Inc. and the National Religious Broadcasters Music License Committee, which will set the rate structure for the webcasters through 2015. An additional agreement signed late Thursday night will be confirmed publicly in coming weeks, officials said Friday. While the rates and terms are specific to each group, they all involve pre-set annual increases to reflect the rising value of sound recordings.
The deals come on the heels of an announcement earlier this month that a payment formula for "pureplay" services, whose main business is streaming music, had been reached after more than two years of private negotiations. See CongressDaily story here(subscription required). The agreements were negotiated under the Webcaster Settlement Act, which gave SoundExchange the authority to negotiate alternative rates and terms to those set by the Copyright Royalty Board in 2007.
House Foreign Chairman Howard Berman, whose previous leadership on the House Judiciary intellectual property subcommittee was instrumental in bringing negotiators together, cheered the new agreements. "I want to thank all the people who spent long hours in my office working towards a solution that works for artists, webcasters, and most importantly music fans. It was worth every moment to ensure that new technologies recognize that creators should have the opportunity to thrive," he said in a statement.
Senate Judiciary Committee
"The Performance Rights Act and Parity among Music Delivery Platforms"
Tuesday, August 4, 2009
Dirksen Senate Office Building Room 226
2:30 p.m.
Sheila E
Grammy Award-winning Artist on behalf of the MusicFIRST Coalition
Bob Kimball
Executive Vice President, Real Networks
Marian Leighton-Levy
Owner, Rounder Records
Steve Newberry
Joint Board Chairman, National Association of Broadcasters
President and CEO, Commonwealth Broadcasting Corporation
Ralph Oman
Adjunct Professor, George Washington University Law School
James L. Winston
Executive Director, National Association of Black Owned Broadcasters
House Energy and Commerce Chairman Henry Waxman and Communications Subcommittee Chairman Rick Boucher, D-Va., want the FCC to consider probing allegations of retaliation by AM and FM stations over pending bills that would require over-the-air radio to pay performers for songs they broadcast, CongressDaily reported Wednesday. While the lawmakers did not take a position on the merits of the June complaint by the MusicFirst Coalition, they said in a letter that the agency should conduct a "thorough examination" of the merits of the claims.
MusicFirst's petition argued that stations have refused their ads but run ads by the National Association of Broadcasters, which opposes the legislation. Most recently, MusicFirst's media buyer was rejected by Clear Channel stations in Houston and Detroit. On Thursday, MusicFirst released the 30-second ad featuring Duke Fakir of the Four Tops, which stations would not run. The bill that is the focus of the ad war passed the House Judiciary Committee in May and will be the subject of a Senate Judiciary Committee hearing Tuesday. Read a preview story about the hearing in CongressDaily here (subscription required).
While calls to Clear Channel were not immediately returned an NAB official said broadcasters are under no obligation to accept any and all advertising. WPGC in Washington, D.C., for example, is not obliged to take ads from WKYS claiming that WKYS is the best hip-hop music station in town. The seminal 1973 Supreme Court decision in Columbia Broadcasting System v. Democratic National Committee outlines that broadcasters have the right to reject advertising.
A little bird tells Tech Daily Dose that Sheila E., the multiple Grammy Award nominee best known for collaborating with Prince , may testify on behalf of the MusicFirst Coalition at Tuesday's Senate Judiciary Committee hearing on legislation that would end a longstanding royalty exemption granted to AM and FM radio. E. recently embarked on a country career and her first music video "Glorious Train" debuted on CMT in March (see above). Or if you prefer classic E., check out "Glamorous Life" here. The National Association of Broadcasters, which has lobbied hard against the bills in the House and Senate, will have a seat at the witness table that will most likely be filled by Commonwealth Broadcasting CEO Steven Newberry. Newberry also appeared before the committee in 2007 opposite singer-songwriter Lyle Lovett. Read a preview story about the upcoming hearing in CongressDaily here (subscription required).
IBM Assistant General Counsel David Kappos, President Obama's pick for Patent and Trademark Office director, appeared before a congratulatory and largely sympathetic Senate Judiciary Committee on Wednesday. During the hearing, he outlined his priorities for the agency, should he be confirmed, and answered questions about the PTO's internal turmoil while offering thoughts about various legislative proposals before Congress that are intended to update the U.S. patent system for the 21st century. Details are available in CongressDaily's PM Edition here (subscription required).
But Kappos, who has a broad knowledge of intellectual property issues, also weighed in on the economic import of IP protection and spoke about the piracy and counterfeiting challenges faced by the movie, music and software industries. In response to a question from the committee's newest member, Sen. Al Franken, D-Minn., Kappos said the United States "unquestionably" faces IP theft problems on a global scale. He hinted at "new capabilities" in the Obama administration -- presumably the yet-to-be-named White House IP czar -- that he expects will lead to "aggressive actions" against bootleggers and more collaboration with foreign counterparts.
He went on to say that, if confirmed, he would work with various administration officials "to engage with whatever countries are needed" including IP offenders in Asia, Eastern Europe and Africa. Kappos said the Office of the U.S. Trade Representative's annual "Special 301" report, which documents countries doing poorly on IP and those that are improving, is "clearly an important part" of the effort. Education is also essential. He said the U.S. government should work with the governments of other countries to help put in place new laws and enforcement scenarios that protect the rights of content creators.
House Global Warming Chairman Edward Markey and ranking member James Sensenbrenner, who seldom agree on issues before their committee, will largely read from the same playbook at a hearing Wednesday intended to reinforce the importance of American intellectual property in conjunction with international climate change talks. The hearing comes as nations prepare for the UN Framework Convention on Climate Change in Copenhagen, Denmark, in December where negotiators will try to reach agreement on how to reduce greenhouse gas emissions. Lawmakers and the business community are working to make their views known to the Obama administration, and Sensenbrenner and Markey raised the issue during a trip to China with House Speaker Nancy Pelosi in May.
The House has repeatedly made clear that IP needs to be protected. The House voted overwhelmingly in June to establish U.S. policy in opposition to any climate change treaty that could harm IP rights as part of the Foreign Relations Authorization Act, and the State Department's appropriations bill includes text requiring the agency to certify robust IP protections. Cap-and-trade legislation that passed the House last month said IP rights are vital for R&D investment. Sensenbrenner wrote to Energy Secretary Steven Chu in April asking for details about the administration's position on IP rights for energy technology, and Chu responded in May. In the letter, Chu affirmed his belief in protecting IP but noted opportunities to develop technologies through shared research investments.
Read a preview story in CongressDaily's AM Edition here (subscription required).
A high-profile case involving a dispute over Patent and Trademark Office rules announced last fall aimed at increasing patent system efficiency could soon come to a close. The Justice Department on Friday filed a motion with the court handling the case to stay proceedings for the purpose of permitting the new Patent and Trademark Office director to reconsider implementation of the rules, which limit applicants to filing two new continuing applications and one request for continued examination. The change was challenged by drug manufacturer GlaxoSmithKline and an independent inventor, Triantafyllos Tafas.
Since all parties consented to the motion, it is expected to be granted, Foley & Lardner intellectual property attorney Hal Wegner said in a memo. Even if the case is not settled, oral arguments before the U.S. Court of Appeals for the Federal Circuit are scheduled for Oct. 7, prior to which the new PTO chief could take other actions. IBM executive David Kappos, President Obama's pick to head the PTO, will appear before the Senate Judiciary Committee on Wednesday then has to be confirmed by the panel and the full Senate. It is uncertain whether the confirmation process could be complete before Congress is scheduled to leave town for August recess next Friday.
Federal and technology transfer officials believe that using "march-in" authority, which allows agencies to take control of a patent under certain circumstances, could have a chilling effect on government-sponsored research, according to a Government Accountability Office report (PDF) released Monday. The officials told GAO that if a march-in occurred, investors would be less likely to provide the funds to commercialize federal inventions for fear of losing their investments. Also, because the process can be long, a march-in would have limited utility in an emergency situation, they said.
GAO reviewed the departments of Defense and Energy, NASA and the National Institutes of Health to review because they accounted for 89 percent of federal research funding for fiscal year 2006 and none had exercised its march-in authority. DOD, DOE, and NASA have never received information that would lead them to initiate such a proceeding in the last 20 years and NIH has been petitioned formally three times but never pursued a case. DOD, NASA, and NIH said they valued the authority but DOE officials disagreed, in part, because no agency has ever used it.
Until March 2009, the Bayh-Dole Act required GAO to report periodically to determine whether march-in authority should be exercised; how the authority has been used; and what barriers and disincentives have been encountered. The GAO made no recommendations as part of its analysis. The Senate Judiciary Committee held a hearing on the topic in October 2007. For more details click here.
House Judiciary Chairman John Conyers and a number of colleagues on Friday asked the Government Accountability Office to investigate the Arbitron ratings company's use of so-called portable people meters and their impact on radio station revenue streams. Many minority-owned broadcasters have expressed concerns about the validity of data collected by the machines and National Association of Black Owned Broadcasters Executive Director James Winston complained about the devices at a hearing earlier this month. Conyers wants the report finished by April 2010.
Winston argued Arbitron has a monopoly over radio rankings and stations that do not subscribe lack data to show potential advertisers. At the same hearing, Arbitron CEO Michael Skarzynski said his firm is developing solutions to help broadcasters, particularly minority and niche outlets, weather the bad economy. One such measurement tool, which will be tested this month, would pair radio exposure with audience engagement so an advertiser could get a clear picture of what ads are most successful with a given station's audience. Read more about the hearing here (subscription required).
"The advertising revenues and viability of minority-owned radio stations depends on an accurate measurement of their audience ratings. I believe it would best serve the public interest to conduct an independent review of the methodology and accuracy of this process," Conyers said in a statement. Other members signing on to the letter include: House Oversight and Government Reform Chairman Edolphus Towns and ranking member Darrell Issa, R-Calif.; Rick Boucher, D-Calif., Hank Johnson, D-Ga., Maxine Waters, D-Calif., Linda Sanchez, D-Calif., Mike Quigley, D-Ill., Pedro Pierluisi, D-P.I., and Sheila Jackson Lee, D-Texas.
The battle over legislation that would end a longstanding royalty exemption afforded to AM and FM radio will move to the Senate early next month with an Aug. 4 hearing in the Judiciary Committee. Senate Judiciary Chairman Patrick Leahy and House Judiciary Chairman John Conyers introduced the legislation, which would bring traditional broadcasters in line with Internet, cable and satellite platforms that pay performers for their works. The Recording Industry Association of America, SoundExchange and the American Federation of Musicians are carrying the torch for that effort while the National Association of Broadcasters has fought hard against the measures. Leahy's panel previously held a hearing on the issue in November 2007 where singer-songwriter Lyle Lovett testified.
Sen. Dianne Feinstein, D-Calif., will chair the Senate Judiciary Committee's hearing. No witnesses have been announced. The House Judiciary Committee approved its version of the bill in May with a vote of 21-9 after members made changes aimed at addressing broadcasters' concerns. The committee adopted, by voice vote, a manager's amendment that would delay the bill's enactment date and reduce the amount of fees stations would have to pay. Conyers said the compromise would cover 90 percent of minority-owned stations and 77 percent of all stations. Rep. Gene Green, D-Texas, sponsored a resolution opposing the royalty. More than 240 members have backed his effort. Sen. Blanche Lincoln, D-Ark., offered a similar Senate resolution, which has 22 cosponsors.
Eight public interest, consumer and public health organizations wrote to the Office of the U.S. Trade Representative on Wednesday recommending the office and other federal agencies reduce secrecy and increase transparency in negotiations that involve global norms for knowledge governance. The groups' submission included a lengthy discussion of 21 specific recommendations, plus three attachments that describe transparency norms in a variety of multilateral and plurilateral norm setting fora.
The letter from the Electronic Frontier Foundation, Knowledge Ecology International, Public Knowledge and others is a product of a consultation with USTR officials that began in March and included a July 13 meeting between USTR and more than a dozen non-governmental organizations. One major area of concern is the Anti-Counterfeiting Trade Agreement. Negotiations between the United States and a handful of trading partners are occurring largely behind closed doors with the goal of concluding in 2010.
The groups' recommendations go beyond ACTA, to address the transparency of all USTR negotiations that concern the setting of global norms for knowledge governance. "Transparency is the foundation stone for balanced policy making," EFF's Gwen Hinze said in a press release. "ACTA could lead to new invasive monitoring of Internet communications by ISPs and raise serious potential due process concerns for Internet users." KEI's James Love said he is heartened by the USTR's recent request for the public to offer concrete ideas about transparency. Read the 21 recommendations here.
Senate Judiciary Chairman Patrick Leahy has released the committee's completed questionnaire pertaining to David Kappos, President Obama's pick for Patent and Trademark Office director, which could signal that his confirmation hearing is around the corner. Kappos, an executive at IBM who would also serve as undersecretary for intellectual property at the Commerce Department, was selected by Obama on June 18 but his hearing was delayed due to the committee's focus on Supreme Court nominee Sonia Sotomayor.
The 16-page questionnaire doesn't include any real surprises. Kappos details his background, professional affiliations and pro bono work as well as his financials. According to the form, he owns vested IBM options valued at approximately $147,000 and those options would be sold within 90 days of his appointment as the PTO's top dog. He also owns unvested IBM options and restricted stock valued at about $1.5 million. All of that deferred income would be cancelled upon his resignation from IBM. On a more personal note, Kappos owns property in Tenants Harbor, Maine originally valued at $100,000. Read more on the committee's Web site here.
Update: Tech Daily Dose has learned that the Kappos confirmation hearing has been scheduled for next Wednesday, July 29. He will appear before the committee with a pair of judicial nominees who also require vetting.
Following on last week's passage of a resolution by the NAACP saluting House Judiciary Chairman John Conyers and supporting performance royalties for musicians that would be provided under a bill he is shepherding through Congress, the Detroit branch of the organization is taking similar action. The Rev. Wendell Anthony, who heads the NAACP in the Motor City appeared at a news conference Tuesday to support the bill that would let performers as well as songwriters get royalties for songs played by AM and FM stations, the Associated Press reported. Radio stations in Detroit and around the country have bashed the Conyers bill, arguing that performers and record labels already are compensated and the measure could hurt stations already struggling in the recession.
"This civil rights for musicians legislation guarantees fair pay for musicians. This is a rebuke of Radio One and Clear Channel for exploiting musicians and smearing members of the Congressional Black Caucus," a spokesman for the MusicFirst Coalition said last week upon passage of the NAACP's resolution at the group's centennial conference. Radio One founder Cathy Hughes and her son, CEO Alfred Liggins, were criticized by Conyers and other members of his committee earlier this month for refusing to appear at a hearing on minority owned media. Hughes previously wrote an open letter arguing the legislation would "murder black owned radio" and in May, the Michigan Broadcasters Association vowed to defeat the measure, claiming it could cost stations in the state more than $63 million annually.
Proposed changes to the Patent and Trademark Office's post-grant review process included in a bill sponsored by Senate Judiciary Chairman Patrick Leahy would increase the patent pendency waiting period by more than 25 percent, and could add to the cost of defending patent validity by billions of dollars, according to an analysis by Case Western Reserve University economist Scott Shane. Judiciary ranking member Jeff Sessions requested that Shane examine the issue earlier this month as staffers for Leahy and Sessions continue meeting with stakeholders about the topic.
The Leahy measure, which passed his committee 15-4 in April, would adopt House-passed text from 2007 that lengthens the timeline for challenging a granted patent and strips out a "public use or sale" provision that Leahy added as a basis for challenging a patent. Specifically, Shane's research found that the length of time between patent application and issuance would increase from 32 months to 40 months and the costs of defending patent validity could rise by $2.2 billion. He also argues that the proposed changes would lead to an annual reduction of $4.4 billion in industrial R&D and would make uncertain the validity of $1.4 billion to $1.7 billion of patents issued annually.
Earlier research from Shane, which was commissioned by the Manufacturing Alliance on Patent Policy, concluded that adopting House language on how damages are calculated in patent lawsuits could lead to job loss and decreased R&D. The alliance, which also bankrolled the new report, is backed by Corning, Monsanto, DuPont and others critical of Leahy's patent reform push. A recent report by the Coalition for Patent Fairness, which supports patent overhauls and counts Cisco Systems, Apple, Dell and others as its members, found that pending legislation would create 100,000 new jobs.
The fifth round of negotiations for the Anti-Counterfeiting Trade Agreement took place in Rabat, Morocco on Thursday and Friday. Participants included Australia, Canada, the European Union, Japan, South Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland, Sweden, and the United States. A spokeswoman for the Office of the U.S. Trade Representative said the meeting was opened by Minister of Industry, Trade and New Technologies Ahmed Reda Chami who emphasized the importance of ACTA and pledged to make intellectual property a main priority.
The discussions focused on international cooperation, enforcement practices and institutional issues (as described in an April summary provided by the USTR). Participants also continued discussions on transparency matters, including providing information to stakeholders and the interested public. Participants agreed to release draft agendas before all subsequent negotiating rounds. The next round will be hosted by South Korea in November. Participants also confirmed their intention to conclude the agreement as soon as possible in 2010, the USTR spokeswoman said.
Earlier this week, tech watchdogs urged ACTA participants to set aside a portion of the negotiations dealing with "Internet distribution and information technology." Last week, the U.S. Chamber of Commerce and trade groups representing movie studios, music labels, video game and software companies and others wrote to the USTR.
See related CongressDaily items here and here (subscription required).
From CongressDaily's AM Edition...
FCC nominees Mignon Clyburn and Meredith Baker were generally noncommittal during their Wednesday confirmation hearing before the Senate Commerce Committee, giving few, if any, hints on how they might decide policy and regulatory issues. That left lawmakers to use the hearing to reiterate their strong criticisms of the commission Clyburn and Baker would join, if confirmed, to fill the remaining Democratic and Republican vacancies, respectively. Read more.
Meanwhile... Senate Commerce Chairman John (Jay) Rockefeller has asked 11 federal agencies, including the FCC, the FTC and the Commerce, Homeland Security and Transportation departments, to report on their cybersecurity preparedness and the effectiveness of their incident-response capabilities. Read more.
And... A group of public interest, library and technology organizations are urging U.S. Trade Representative Ron Kirk to set aside a controversial portion of Anti-Counterfeiting Trade Agreement negotiations focused on "Internet distribution and information technology." Read more.
A Web-based governmental social networking project aimed at improving patent quality by connecting the Patent and Trademark Office with outside scientific and technical experts has effectively shut down after a two year test run and accolades from the White House. The Peer-to-Patent project, a joint effort between the PTO and New York Law School's Center for Patent Innovation has stopped accepting new applications but will continue processing those already in the system. The PTO elected to close Peer-to-Patent to new applications "until it can complete a full evaluation of the impact the project has had on the patent examination process," according to a NYLS press release.
There remain more than 70 applications on the Peer-to-Patent site awaiting review and interest in the program remains high as evidenced by the continued interest of applicants, the federal government, educational institutions, and international patent offices, officials said. Major companies such as General Electric, Hewlett-Packard, IBM, Intel, and Microsoft all submitted patent applications to the Peer-to-Patent process. Other patent applications were submitted by Cisco Systems, Disney Enterprises, eBay, Novel, Red Hat, Sun Microsystems, Xerox, and Yahoo, as well as smaller firms.
Peer-to-Patent was launched in June 2007 by Beth Noveck, a professor at the law school who now serves as President Obama's deputy chief technology officer and head of the White House's open government project. The project is featured in the White House Open Government Innovations Gallery, an online resource that "celebrates the innovators and innovations who are championing the President's vision of more effective and open government." IBM executive David Kappos, Obama's pick for PTO director, was one of the early proponents of Peer-to-Patent and directed IBM in providing both financial and technical assistance for the effort.
*Updated* The U.S. Court of Appeals for the District of Columbia on Friday refused to rule on the constitutionality of a federal panel that sets copyright royalties. Licensing firm Royalty Logic claimed the Copyright Royalty Board is unconstitutional because the Librarian of Congress, who is not technically the head of a government department, appoints its judges. As such, the complaint argued the CRB should be forced to vacate its decision in a proceeding that set the fee structure for webcasters.
National Music Publishers' Association President David Israelite wrote to House Judiciary Chairman John Conyers and ranking member Lamar Smith recently urging them to consider introducing legislation that would make moot any constitutional challenges to the CRB. Israelite argued that Royalty Logic's lawsuit could have meant the unraveling of all the panel's decisions since its judges (pictured) were appointed in 2006. He said Friday's ruling was a "sigh of relief" for the music industry. David Oxenford, an attorney who represents small webcasters in CRB proceedings, said the decision "really just delays the consideration of the issue of the constitutionality of the CRB. Now that this issue is on the table, it is bound to be raised by other parties in other CRB proceedings."
As the CRB embarks on its consideration of webcasting rates for 2011-2015, "there is a cloud hanging over its existence -- one that may take another Court decision, or some corrective action by Congress, to remedy," he wrote on his blog. Royalty Logic's attorney Kenneth Freundlich said he was surprised at the court's failure to address what he called a "fundamental issue." At the hearing, the judges pondered whether there should be further briefings on the matter but never followed up. Instead they cited "'inadequate briefing' as a basis for ducking the issue," he said, noting the ruling cites two cases that support his arguments. "Let this decision be a warning to all concerned and a message to Congress to fix this mess," Freundlich said.
House Judiciary Courts and Competition Policy Subcommittee Chairman Hank Johnson, D-Ga., was among the most vocal lawmakers at Thursday's hearing on issues confronting minority-owned media. While Judiciary Chairman John Conyers was critical of Radio One founder Cathy Hughes and her son, CEO Alfred Liggins, for refusing to appear before his panel, Johnson took his criticism of their absence a step further.
While humorously pondering what might have taken precedence over the hearing, the former DeKalb County Commissioner suggested that Hughes -- who has been critical of legislation Conyers introduced that would end a royalty exemption afforded to AM and FM radio -- was "out spending some of that 700 percent increase in salary" that she was reportedly gifted as matriarch of the largest minority-owned media company in the United States. And Liggins? "I guess he's out spending the $10 million bonus that he received last year in the midst of these difficult economic times," Johnson riffed.
But during a hearing recess, Tech Daily Dose reached Liggins by phone and he was definitely not on a shopping spree. The Radio One executive explained that he did not want to testify at a hearing that would further bash broadcasters for opposing the Conyers performance rights legislation. Had the session focused solely on slipping advertising revenue and other challenges facing his industry, he might have been on board. Liggins also clarified that the purported bonus was, in fact, not as steep as Johnson indicated and "compensation at our company should be irrelevant."
Read more coverage of the hearing in CongressDaily's PM Edition here and in Friday's AM Edition (subscription required).
Radio One, the largest U.S. minority-owned media company, came under fire from the House Judiciary Committee on Thursday for refusing to testify at a hearing billed as a forum to examine plummeting advertising revenues, increased media consolidation and pending legislation that would end a long-standing copyright royalty exemption for over-the-air radio, which broadcasters oppose. Judiciary Chairman John Conyers and others scolded Radio One founder Cathy Hughes and her son, CEO Alfred Liggins, for being no-shows. Other critics of the bill who Conyers said snubbed him include National Action Network President Rev. Al Sharpton; Rainbow Push Coalition President Rev. Jesse Jackson; syndicated radio host Tom Joyner; and the Minority Media and Telecommunications Council's David Honig.
Judiciary Courts and Competition Policy Subcommittee Chairman Hank Johnson, D-Ga., said broadcasters were invited to weigh in on the bill before it passed the committee in May, but their unwillingness to offer performers any compensation is unreasonable since Internet, cable and satellite services all pay. Liggins called the hearing "misguided and disingenuous." He said he backed out as a witness after learning Conyers would focus on the royalty bill and had invited a supporter of the measure, R&B Foundation Chairman Kendall Minter, to testify. "I'm not going to sit there and get beat up," Liggins said in a phone interview. Read the full story in CongressDaily's PM Edition here (subscription required).
The Intellectual Property Owners Association on Wednesday urged Senate Judiciary Committee leaders to schedule a hearing soon on the confirmation of President Obama's pick for Patent and Trademark Office director, David Kappos. IPO said it is "critical for new management to be put in place as soon as possible" to address the many challenges currently "hindering effective processing of patent applications." The letter said Kappos meets all of the qualifications IPO has recommended for the PTO position in letters to the administration. The PTO, which is funded through user fees and is faced with a lengthy patent application backlog, recently suspended overtime pay for patent examiners and earlier instituted a hiring freeze.
The group told Judiciary Chairman Patrick Leahy and ranking member Jeff Sessions that Kappos, an IBM executive, has an exceptional record in IP law and significant experience in industry as a manager. He has worked within IPO and other associations to improve IP practice and communications with the PTO. Kappos is in line behind Supreme Court nominee Sonia Sotomayor whose Senate Judiciary Committee confirmation hearing begins next week. While the agency awaits its new leader, Commerce Secretary Gary Locke has appointed Nicholas Godici, a high-ranking Clinton administration patent official, to serve as an expert appointee and liaison between the PTO and Commerce.
Commerce Secretary Gary Locke, the only Cabinet secretary to join President Obama on his trip this week to Russia, stressed the need to combat intellectual property piracy and counterfeiting with Russian Minister of Economic Development Elvira Nabiullina, although the issue took a backseat to broader issues. "IP is on the agenda, but I wouldn't want to exaggerate its importance in these talks," a senior Commerce official traveling with Locke said Tuesday. Topics like Russia's accession to the World Trade Organization, larger rule of law questions surrounding government transparency and import tariffs, and climate change were prioritized. But in same-day remarks at a business summit, Locke lauded Russia's recruitment of U.S. corporations like Boeing, Motorola, Microsoft, and Procter & Gamble, all of whom have a huge stake in fighting foreign and domestic IP crime. Locke said the United States and Russia must "increase the openness of our markets to trade and to investment" and during tough economic times remember to "not repeat the historic mistakes of protectionism of previous eras." Locke and Nabiullina will lead a business and economic relations working group under a bilateral commission co-chaired by Obama and Russian President Dmitry Medvedev.
Read the full story in CongressDaily's AM Edition (subscription required).
The House late Tuesday passed legislation under suspension of the rules that would authorize the Patent and Trademark Office to use money statutorily cordoned off for its trademark portfolio to pay for patent-related work. The PTO, which is funded through user fees and is faced with a lengthy patent application backlog, recently suspended overtime pay for patent examiners and earlier instituted a hiring freeze. PTO officials have said the loan is justified because the trademark budget has a massive surplus. House Judiciary Chairman John Conyers's bill and a companion measure sponsored by Senate Judiciary Chairman Patrick Leahy are intended to stave off potential furloughs and reductions-in-force. Under the Conyers bill the PTO could use trademark funds made available for fiscal year 2009 of up to $70 million to support the processing of patents and related activities. The measure would also establish a surcharge to repay those funds. The PTO would have until June 30, 2010 to use the authority and the surcharge would take effect no later than Sept. 30, 2011 with all funds being repaid by Sept. 30, 2014. Worth noting: The Leahy bill doesn't assign a specific dollar amount.
From Tuesday's CongressDaily PM Edition (subscription required).
After more than two years of private negotiations, music and Internet industry stakeholders have arrived at a formula for commercial webcasters to pay copyright owners and artists for their songs. The deal came a week after President Obama signed legislation sponsored by Rep. Jay Inslee, D-Wash., and Sen. Ron Wyden, D-Ore., that kept deliberations on track while delaying implementation of a controversial 2007 rate-setting by a federal panel that determines royalty fees for various distribution platforms.
Under the agreement announced today, "pureplay" services, whose main business is streaming music under a government license, would pay a percentage of their U.S. revenue up to 25 percent as well as a $25,000 per year minimum royalty as an alternative to the Copyright Royalty Board's calculation, which webcasters argued could put them out of business. Wyden said he was happy to help reach a deal and ensure that the "unjust decision of the CRB wasn't applied to this dynamic new medium." Inslee said webcasters and copyright holders "needed this freedom to negotiate and craft a royalty rate structure that's fair for all impacted parties."
Commerce Secretary Gary Locke has named a high-ranking Clinton administration patent official to serve as an expert appointee whose job will be to assist the new Patent and Trademark Office director and act as a liaison between the office and the Commerce Department, which houses the PTO. Nicholas Godici served for five years as commissioner for patents, acting under secretary of commerce for intellectual property and director of the PTO and got his start as at the agency as an examiner 30 years earlier. His term in the Obama administration is limited to 180 days. IBM executive David Kappos was tapped to become head of the PTO last month but must be confirmed by the Senate. He is in line behind Supreme Court nominee Sonia Sotomayor whose Senate Judiciary Committee confirmation hearing begins Monday.
Godici, who has been a top advisor to Birch, Stewart, Kolasch & Birch, LLP since 2005, could be a valuable asset at PTO as the agency struggles to avoid budget cuts and furloughs. The office, which is funded through fees collected from its users, recently suspended overtime pay for patent examiners and earlier this year instituted a hiring freeze. Lawmakers have introduced legislation that would let the PTO's patent division borrow money from its trademark portfolio, which has a multi-million dollar surplus. A House bill sponsored by Judiciary Chairman John Conyers is scheduled for a floor vote under suspension of the rules late Tuesday. Senate Judiciary Chairman Patrick Leahy has introduced a companion measure in his chamber.
Godici was on Capitol Hill in December where he spoke at a Computing Technology Industry Association event that focused on the future of the PTO. Watch a video of that briefing here. Other panelists included Gerald Mossinghoff, Bruce Lehman, and Q. Todd Dickinson, all former leaders at the PTO.
President Obama and Russian President Dmitry Medvedev held their first joint press conference in Moscow on Monday where they spoke about plans to reset the countries' relationship. The pair released a statement outlining a new framework for arms reduction and announced the creation of a bilateral commission with working groups focused on a range of topics including: nuclear energy; arms control; foreign policy and fighting terrorism; drug trafficking; business development and economic relations; energy and environment; agriculture; science and technologies; space cooperation; health; handling of emergency situations; civil society; and educational and cultural exchanges.
Additional working groups will be created and announced in the coming months, along with sub-groups under each working group as appropriate, officials said. While it was not explicitly mentioned, intellectual property policy -- namely anti-piracy and counterfeiting measures -- could easily fit into one or more of those categories. Russia regularly ranks among the top offenders in assessments of global IP infringement. In its annual "Special 301" report, the Office of the U.S. Trade Representative noted serious concerns with Russia but credited positive steps taken by the government like the nation's accession to the World Intellectual Property Organization's Internet treaties.
The International Intellectual Property Alliance, which represents the American music, movie, software, and video game industries, told the USTR earlier this year that Russia's "enforcement efforts generally remain inadequate, and the copyright industries continue to await sustained, effective and deterrent enforcement, enhanced legal reform, and greater market access for legitimate copyrighted materials." The country has not met its obligations under a 2006 IP agreement with the United States and must take action against entities that knowingly distribute infringing products, combat the growing threat of Internet piracy, and address illegal optical disc manufacturing, IIPA stated. Read more from IIPA here.
The Justice Department has formally acknowledged an investigation into Google's settlement with publishers over its effort to digitize mass quantities of books. The New York Times and others have reported that Deputy Assistant Attorney General William Cavanaugh wrote to the federal judge administering the settlement, stating: "The United States has reviewed public comments expressing concern that aspects of the settlement agreement may violate the Sherman Act... At this preliminary stage, the United States has reached no conclusions as to the merit of those concerns or more broadly what impact this settlement may have on competition. However, we have determined that the issues raised by the proposed settlement warrant further inquiry."
The $125 million agreement was signed in October to resolve a 2005 class action lawsuit filed by the Authors Guild and the Association of American Publishers against the Internet giant. In the complaint, the authors and publishers said Google's plan to digitize millions of books from libraries and make them available in its Book Search service amounted to a whopper of a copyright violation. The settlement would let Google display books online and profit from them by selling access to titles and by selling subscriptions to its collection. Authors and publishers would get a chunk of the revenue. U.S. District Judge Denny Chin set a Sept. 18 deadline for the government to offer its views in writing. He has scheduled an Oct. 7 hearing on the settlement.
High-tech advocacy groups this week filed a friend-of-the-court brief opposing efforts by music licensing organization ASCAP to impose additional licensing payments on providers of musical ringtones for mobile phones. The Center for Democracy and Technology, the Electronic Frontier Foundation, and Public Knowledge urged a New York federal court to reject ASCAP's claim that ringtones are "public performances" under copyright law simply because a phone may ring when the user is in a public place. ASCAP's position implies that mobile phone users are copyright infringers and would expand liability in ways that could chill innovation in products far beyond the relatively narrow context of ringtones, the groups argued.
ASCAP, which has about 360,000 members, recently released a memo in support of its legal battle against AT&T and Verizon that argues wireless carriers make billions of dollars from ringtones including per tone charges and multiple additional charges surrounding the transmission of ringtones. The revenue generated is "more than sufficient to cover a reasonable payment to ASCAP members," the organization said. Additionally, ASCAP stressed that it seeks to license carriers' transmissions of music and is not trying to charge consumers. EFF attorney Fred von Lohmann called ASCAP's an "outlandish argument," noting that under its reasoning, someone playing a car radio with the window down would be violating copyright law.
A related debate could play out on Capitol Hill. In a recent recent letter, songwriter and music publisher representatives requested legislation to expand the scope of the public performance right so that it will apply to digital downloads of audiovisual works. Trade groups representing Internet music providers, e-commerce firms and electronics manufacturers claim the effort would "impose a licensing obligation and potentially significant royalties on activities that are unequivocally unrelated to public performance." House Judiciary Chairman John Conyers is planning a hearing on the issue while Senate Judiciary Chairman Patrick Leahy has begun talking with stakeholders.
A trade advisory body to the European Union and the U.S. government on Wednesday approved a resolution calling on policymakers worldwide to consider measures to moderate what its member argue are harmfully long terms of copyright and related rights. The TransAtlantic Consumer Dialogue's declaration opposes protections that exceed the period required by a 1994 World Trade Organization agreement. That WTO's treaty says performers have the right to prevent unauthorized recording, reproduction and broadcast of live performances for no less than 50 years and producers of sound recordings have the same window to prevent unauthorized reproduction.
In cases where the WTO's guidance is not followed, TACD asks governments to introduce measures, such as limitations and exceptions to rights, or registration requirements. The 80-member group first discussed the resolution with representatives from the EU and United States in June during TACD's annual meeting in Brussels. "For too long, legislatures have accepted uncritically the assertions of industry that longer copyright terms necessarily lead to more creation. However, as terms reach multigenerational lengths, mounting evidence has shown that long terms can chill discussion, debate, analysis and revisiting of existing works," Public Knowledge's Sherwin Siy said in a press release.
Extending what amounts to a temporary monopoly without sound economic justification, does not facilitate the search for new business models, nor address the need for the increased provision of legal content, argued Kostas Rossoglou of the European Consumers' Organisation in Brussels. "Copyright should aim to keep a balance between rights holders and society as a whole." TACD's Anne-Catherine Lorrain noted that if policymakers decide longer terms of copyright protection are needed, "they still have the option to counter-balance the harmful effects of such policies, by adopting several measures to improve public access to knowledge goods."
Read the TACD resolution here.
Senate Judiciary ranking member Jeff Sessions has requested that Case Western Reserve University innovation expert Scott Shane analyze the potential impact of a pending bill's approach to administratively challenging a patent's validity after it is granted. The proposed changes to the Patent and Trademark Office's post-grant review process are included in a bill sponsored by Judiciary Chairman Patrick Leahy, which passed his committee 15-4 in April. Staffers for Leahy and Sessions have been meeting with stakeholders about the issue in recent weeks even as the panel focuses on the forthcoming confirmation hearings of Supreme Court nominee Sonia Sotomayor.
As amended, the measure would adopt House-passed text from 2007 that lengthens the timeline for challenging a granted patent and strips out a "public use or sale" provision that Leahy added as a basis for challenging a patent. Shane's research earlier this Congress on apportionment of damages concluded that adopting House language could lead to job loss and decreased R&D investment. Leahy's panel ultimately watered down the damages text so the bill could advance. Shane's report was commissioned by the Manufacturing Alliance on Patent Policy, a group backed by Corning, Monsanto, DuPont and others. His latest research will be ready for Sessions within two weeks, Tech Daily Dose has learned.
Click here to read recent CongressDaily coverage of the emerging conflict over post-grant review language (subscription required).
President Obama on Tuesday signed legislation that would allow months of royalty negotiations between the music and Internet industries continue while delaying full implementation of a controversial rate-setting for webcasters imposed by the Copyright Royalty Board. The measure replaces a Feb. 15, 2009 deadline that was part of legislation that passed the 110th Congress, with a 30-day window from the date of enactment for a deal to be reached between digital royalty collector SoundExchange, which is negotiating on behalf of copyright owners and performers, and Internet services represented by the Digital Media Association and others.
The bill's sponsor was Rep. Jay Inslee, D-Wash., who had support from Judiciary Chairman John Conyers, Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., and others. Its Senate sponsors were Sens. Ron Wyden, D-Ore., and Sam Brownback, R-Kan. A source told Tech Daily Dose that so-called "pureplay" negotiations have been completed and a deal could be signed as soon as stakeholders return from Independence Day vacation. As soon as that happens, the proposal will be announced and submitted to the Register of Copyrights for publication. "Pureplay" webcasters refers to those whose sole business activity is to stream sound recordings over the Internet.
National Music Publishers' Association President David Israelite urged House Judiciary Chairman John Conyers and ranking member Lamar Smith late Friday to consider introducing legislation that would clear up any confusion surrounding the constitutionality of a federal panel that sets copyright royalties. The request comes on the heels of a May complaint from licensing firm Royalty Logic asking that the Copyright Royalty Board be forced to vacate its decision in a controversial proceeding that set the fee structure for webcasters. The filing claims the CRB is unconstitutional because the Librarian of Congress, who is not technically the head of a government department, appoints its three judges.
If successful, the protest could mean the unraveling of all of the CRB's decisions since its judges were appointed in 2006. "This could cause complete chaos in the marketplace," Israelite wrote in a letter. In it, he notes that in the proceeding in question, songwriters, music publishers, digital media firms and record labels negotiated a landmark deal on the rate and terms for musical works delivered by interactive streams and limited downloads. The board's decisions "should not be thrown away because of a technicality," he said. NMPA wants Conyers and Smith to sponsor a bill that would make moot any challenge to the CRB based on the appointments clause of the Constitution as well as uphold its determinations.
The Supreme Court on Monday said it would not hear a case in which Hollywood studios and some cable networks sued Cablevision for providing a remote digital video recorder service where the copy of the recorded program resides on the cable operator's servers rather than on a hard drive in the home. The studios alleged that the so-called "buffer copies" and the copies residing on Cablevision's servers were a violation of its right to reproduce the program and that the recordings sent to the customer infringed on its public performance right. A lower court in New York City sided with the studios but an appeals court reversed that decision.
Since there is no further litigation pending in this case, Cablevision is now free to implement the remote DVR service and other providers will likely follow suit, Stifel Nicolaus analysts said in an e-mail. The remote functionality saves Cablevision storage costs, reduces expensive truck rolls, and allows their customers greater flexibility, they wrote. The issue could arise again in a later suit by the content owners against another cable company that implements its own remote DVR and could wind up back at the Supreme Court, the analysts added. Consumer Electronics Association President Gary Shapiro lauded the ruling, saying it was a "slam dunk" from a common sense standpoint.
Cablevision Chief Operating Officer Tom Rutledge called the action "a tremendous victory" but said he remains mindful of the potential implications for ad skipping and the concerns this has raised in the programming community. "We believe there are ways to take this victory and work with programmers to give our customers what they want -- full DVR functionality through existing digital set-top boxes -- and at the same time deliver real benefits to advertisers," he said in a statement. Copyright Alliance Executive Director Patrick Ross said the high court's ruling "is unfortunate and potentially harmful to creators and creative enterprises across the spectrum of copyright industries."
As staffers for Senate Judiciary Chairman Patrick Leahy resume negotiations with stakeholders who are divided over sections of his bill to overhaul the U.S. patent system, (see CongressDaily's AM Edition for coverage), aides for Sen. Orrin Hatch, R-Utah, are trying to build support for a proposal that would essentially let the Patent and Trademark Office examine information that was not considered during an earlier patent review. Officials from the generic and brand pharmaceuticals industries as well as biotechnology interests met with Hatch's team on Monday. Under the longtime intellectual property crusader's plan, if a patent is issued, the information in question may not be used to hold the patent unenforceable.
Language that Hatch prepared to introduce when Leahy's panel marked up the broader bill in April also clarifies that requesting the reissue (or the decision not to) cannot alone be the basis of an "inequitable conduct" challenge. The proposal would leave untouched the underlying doctrine, which generic drug makers believe is vital to ensure timely market entry of medicines. Hatch, an original cosponsor of Leahy's bill, announced during the mark up that he could no longer support the final product and was one of four members who voted against the measure. "[The bill] has the very real potential to undermine the stimulatory effects of not only our patent system but those abroad," he said at the time.
Generics manufacturers previously argued Hatch's proposal would incentivize deception before the PTO. It's a back door "but for" test that would do away with the inequitable conduct defense, they said. But the senator's office is trying to engage in good faith negotiations with key players and hopes to reconvene the group for further talks after the Independence Day recess, sources said. One individual who attended the Monday meeting said there was "a great deal of positive interaction," with all parties trying to understand each others concerns. If the patent reissue problem can be solved, Hatch is more likely to rally his GOP colleagues in support of Leahy's bill as it heads toward the Senate floor.
Sen. Orrin Hatch, R-Utah, and a handful of other senators urged President Obama on Thursday to protect intellectual property as talks begin on a global climate change treaty. Proposals have surfaced by representatives of some countries to allow foreign producers to copy or infringe patented technologies. "The United States government cannot afford to sit idle while others seek to weaken IP protections," they wrote. "America must continue to set the standard for IP protection, and be willing to confront those countries and organizations that attempt to weaken IP rights." Hatch collected signatures from Sens. Evan Bayh, D-Ind.; Robert Bennett, R-Utah; Debbie Stabenow, D-Mich.; Charles Grassley, R-Iowa; Arlen Specter, D-Pa.; George Voinovich, R-Ohio; John Thune, R-S.D.; Judd Gregg, R-N.H.; and David Vitter, R-La.
The senators explain that some governments mischaracterize IP rights as an obstacle to progress and require compulsory licenses of IP or forced technology transfers. China and India claim they cannot meet future global emission requirements without free or significantly discounted access to climate change mitigation technologies. "These short-sighted approaches to IP rights will curtail growth and development, and stagnate the very industries that these countries depend on," they wrote. A coalition backed by the Chamber, General Electric, Microsoft, Siemens and other multinationals has been putting similar pressure on the Obama administration. A series of meetings will culminate at the U.N. Framework Convention on Climate Change in Copenhagen, Denmark, in December, where parties will seek agreement on reducing greenhouse gas emissions.
This just in... President Obama has announced his intention to nominate IBM Assistant General Counsel David Kappos to become director of the Patent and Trademark Office. His bio, included in the White House announcement, is pasted after the jump. Kappos, who joined the company as a development engineer in 1983, was among several rumored top contenders for the job. Others included American Intellectual Property Law Association Executive Director Q. Todd Dickinson, who was PTO director under former President Bill Clinton, and Jim Pooley, a Silicon Valley attorney who was installed earlier this week as the World Intellectual Property Organization's deputy director general for patents. Look for more in CongressDaily's AM Edition on Friday.
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Two high-tech watchdog groups that filed a Freedom of Information Act lawsuit in 2008 against the U.S. government over a perceived lack of transparency in Anti-Counterfeiting Trade Agreement negotiations have reluctantly dropped their complaint. The Electronic Frontier Foundation and Public Knowledge said Wednesday that the Obama administration's decision to support Bush-era concealment policies prompted the move. Federal judges have very little discretion to overrule Executive Branch decisions to classify information on national security grounds and government lawyers recently informed the court that they intend to defend the classification claims on those grounds, officials said.
Negotiating texts and background documents for the trade deal have been made available to representatives of major media copyright owners and pharmaceutical companies yet private citizens have had to rely on unofficial leaks for substantive information about the treaty, EFF International Policy Director Gwen Hinze said in a press release. "This can hardly be described as transparent or balanced policy-making," she said. U.S. Trade Representative Ron Kirk on Friday announced that representatives from the United States, Canada, the European Union, Japan, Mexico and other countries will meet in Morocco next month to resume ACTA discussions with an eye for completion in 2010.
Read related CongressDaily coverage here (subscription required).
High-tech attorney Jim Pooley, one of several top contenders for the job of Patent and Trademark Office director, was approved by World Intellectual Property Organization leaders on Monday as deputy director general for patents. Pooley has been a partner in the litigation department of the Palo Alto office of Morrison & Forrester and has practiced in Silicon Valley since 1973. He is immediate past president of the American Intellectual Property Law Association and president of the National Inventors Hall of Fame. Other new deputy directors general are: Geoffrey Onyeama (Nigeria), cooperation for development (including development agenda and WIPO Academy); Wang Binying (China), trademarks, industrial designs and geographical indications; and Johannes Wichard (Germany) global issues (including enforcement, arbitration/mediation, communications, and the committee on genetic resources, traditional knowledge and folklore). For more, click here. (Hat tip, William New)
The House voted overwhelmingly late Wednesday to establish new U.S. policy in opposition to any global climate change treaty that weakens the intellectual property rights of American green technology as part of the Foreign Relations Authorization Act. The vote comes as diplomats prepare for December negotiations as part of the U.N. Framework Convention on Climate Change. "American innovations in clean energy technology create good-paying jobs today and will fuel our country's economic growth in the future," said Rep. Rick Larsen, D-Wash., who offered the amendment with Rep. Mark Kirk, R-Ill. Kirk, a member of the U.S. delegation to Kyoto in 1997, emphasized that jobs will not be created if foreign competitors are allowed to seize U.S. inventions.
House Foreign Affairs Chairman Howard Berman's core bill included language to increase resources and training for enforcement of intellectual property rights. Berman is a longtime leader on IP issues and chaired the House Judiciary Subcommittee on Courts, the Internet, and Intellectual Property in the 110th Congress. Under the bill, the Secretary of State would appoint 10 new IP attachés to serve in embassies or other diplomatic missions with priority placement given to countries with particularly egregious IP regimes. "This legislation will play a vital role in efforts to protect job-creating intellectual property abroad," said Mark Esper, executive vice president of the U.S. Chamber of Commerce's Global IP Center.
One-size-fits-all policymaking does not produce favorable outcomes when developing countries are trying to formulate solid intellectual property regimes, World Bank Senior Vice President Anne-Marie Leroy told the World Copyright Summit on Wednesday. That's why her organization has supported a range of projects in various countries aimed at helping them stand up personalized IP protection processes and avoid the pitfalls of cutting and pasting regulations from other legal systems. In the late 1990s, the bank offered millions of dollars to Brazil, Indonesia and Mexico for that purpose, Leroy said. Additionally, a multi-million dollar trust fund program has supported investments in the music industries of Ghana, Senegal, Jordan and Nigeria.
"Domestic IP policies and laws should adapt standards that are well within their domestic institutional capacity to implement," she said, noting that it's important to avoid creating what she called "systemic internal inconsistencies" that eventually lead to failures in IP enforcement. Distortions in a country's IP framework provide gaps and opportunities for abuse and corruption, Leroy added. In the big development picture, however, intellectual property is only one component for stimulating competitive commercial infrastructures, she said. Other key ingredients include reforming tariff and tax policies; reducing the cost of trade; and advocating for export promotion policies.
Key business groups offered support Tuesday for a legislative amendment that would reaffirm intellectual property rights for U.S. technologies developed to deal with climate change, CongressDaily's AM Edition reported. The National Association of Manufacturers, U.S. Chamber of Commerce and the United States Council for International Business said that as talks proceed on a climate change treaty, proposals have surfaced to allow foreign producers to copy or infringe patented technologies. On a parallel track, a coalition backed by the Chamber, General Electric, Microsoft, Siemens and other multinational firms is putting pressure on the Obama administration and key lawmakers as trade negotiators prepare for U.N. climate change talks this summer.
"While progress on these environmental negotiations is vitally important, such compulsory licensing is not the answer," the groups said in a letter Tuesday backing a proposal by Reps. Rick Larsen, D-Wash., and Mark Kirk, R-Ill., offered as an amendment to the foreign relations authorization bill expected on the House floor soon. The House Rules Committee approved a slightly modified version of the amendment Tuesday that will be considered with the bill on the House floor. Business groups worry that countries like Brazil, China and India will push for mandatory carve-outs for alternative energy innovations. A series of meetings begin this month and will lead up to the U.N. Framework Convention on Climate Change in Copenhagen, Denmark, in December, where parties will seek agreement on reducing greenhouse gas emissions.
Read CongressDaily's recent coverage of this issue here and here (subscription required).
A group backed by the Recording Industry Association of America, digital royalty rights collector SoundExchange and other music interests filed a complaint with the FCC late Tuesday claiming that AM and FM radio stations belonging to the National Association of Broadcasters have threatened performers, refused to run their advertisements, and made misleading statements to the public. The filing by the MusicFirst Coalition comes as Congress contemplates whether to end a long-standing royalty exemption afforded to terrestrial radio. "For more than 80 years radio stations have been using the work of artists and musicians without compensating them, now they're using the public airwaves unfairly for their own self interest," said MusicFirst Executive Director Jennifer Bendall. "We respect the First Amendment rights of broadcasters to air their views in this and any debate, but they've crossed the line."
NAB spokesman Dennis Wharton issued a statement calling the allegation "an act of desperation by a record label lobby losing on Capitol Hill and in the court of public opinion." He added that Will.i.am, a vocal proponent of the performance fee legislation, and his group The Black Eyed Peas currently hold the No. 1 slot on Billboard's Pop 100 Airplay Chart with the song "Boom Boom Pow." "If there's an FCC probe involving the music business, it ought to focus on claims from numerous artists -- from The Beatles to Prince to Cher -- that they were cheated out of royalties by their record labels," Wharton said. The House Judiciary Committee recently approved the bill backed by MusicFirst and a companion measure awaits action in the Senate Judiciary Committee.
Congressional Intellectual Property Promotion and Piracy Prevention Caucus Co-Chair Robert Wexler warned an international crowd of copyright executives Wednesday that the intellectual property policy push outside of Washington and Brussels has not gained enough steam. Most average citizens would be unable to describe what IP piracy is and others don't see it as a threat, the Florida Democrat said during a luncheon keynote at the World Copyright Summit. He cautioned that momentum for international IP infringers is building and offered as proof the fact that Sweden's Pirate Party won a seat in the European Parliament early Sunday. The group, buoyed by young people and first-time voters, became known earlier this year for its support of the controversial file-sharing Web site Pirate Bay.
Government and private sector efforts to make IP theft taboo have fallen short, he said. "Those of us who understand the importance of IP law fail to do the job of educating others toward our point of view," Wexler said, urging creators, governments and industry to spread a cohesive message. "We have a great story to tell but we must tell it better." Traditional advocacy is not enough because it gets lost in a sea of detractors who "don't necessarily play by the rules," Wexler said. Groups like Sweden's Pirate Party, which wants more free Internet content, woo supporters with attractive prose that is not based in fact, he said. "We end up with the difficult task of explaining the finer points of copyright law to a public that has little or no interest in an explanation," Wexler said.
The House on Tuesday passed legislation under suspension of the rules that would allow many months of royalty negotiations between the music and Internet industries continue while delaying full implementation of a controversial rate-setting for webcasters imposed by the Copyright Royalty Board. The legislation was sponsored by Rep. Jay Inslee, D-Wash., with support from Judiciary Chairman John Conyers, Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., and California Democrats Zoe Lofgren and Anna Eshoo. It would replace a Feb. 15, 2009 deadline that was part of legislation that passed the 110th Congress, with a 30-day window from the date of enactment for a deal to be reached between digital royalty collector SoundExchange, which is negotiating on behalf of copyright owners and performers, and Internet radio services represented by the Digital Media Association and others.
Sen. Ron Wyden, D-Ore., introduced a companion measure with Sen. Sam Brownback, R-Kan., last month and the bill has been referred to the Judiciary Committee. SoundExchange and the National Association of Broadcasters already reached agreement on Internet radio royalties earlier this year that provides discounts on previously set rates for 2009 and 2010 and establishes rates for 2011-2015. Under the arrangement, which involves AM and FM radio stations that simulcast programming over the Internet or that create new stand-alone Internet stations, simulcasts or Web channels operated by local stations are reduced for the first two years by about 16 percent then gradually increase through 2015 -- from $0.0015 per streamed sound recording in 2009 to $0.0025 per stream by 2015. Read more on the topic here.
Sen. Orrin Hatch, R-Utah, said Tuesday he is hopeful the Senate Judiciary Committee will move forward on its intellectual property agenda as early as this summer despite a packed schedule of judicial appointments, most prominently that of Supreme Court nominee Sonia Sotomayor. Among the issues awaiting the panel's attention include a proposal to end an AM/FM radio royalty exemption; overhauling a portion of U.S. copyright law that deals with musical tracks, images, videos or other content whose owners cannot be easily located; and a bill to reauthorize expiring provisions of a statute that lets satellite systems retransmit local and distant TV signals into markets across the country. His comments at the World Copyright Summit echoed Thursday remarks by Judiciary Chairman Patrick Leahy.
"There's no question that radio play promotes artists and their sound recordings," Hatch, himself a songwriter. "There's also no question that radio stations profit directly from playing artists' recordings." Despite an oppositional lobbying blitz by the National Association of Broadcasters, a bill that would require payments to performers passed the House Judiciary Committee last month. Representatives from both camps faced off at the conference with NAB and Recording Industry Association of America executives predicting a lengthy, potentially multi-year fight. "The question is not will this pass, but when will it pass," RIAA CEO Mitch Bainwol said. Digital Media Association Executive Director Jonathan Potter and Public Knowledge President Gigi Sohn urged for a broadening of the effort to ensure parity across music platforms, including Internet radio.
Public Knowledge President Gigi Sohn urged the Obama administration on Tuesday to employ "a nuanced, balanced" approach to naming key intellectual property posts in the federal government. President Obama has yet to name a White House IP enforcement coordinator, as mandated by a law that passed the 110th Congress, or Patent and Trademark Office director. She told the World Copyright Summit that the IP czar should not be a policymaker but instead must focus on harmonizing efforts by a range of agencies that have enforcement authority. "There needs to be someone to get them all on the same page," Sohn said, lauding the work of the Bush administration's key IP officer Chris Israel who was stationed at the Commerce Department. "We don't think the job should change -- it just has more gravitas," she said.
Copyright Alliance Executive Director Patrick Ross, who regularly finds himself at odds with Sohn's viewpoint, agreed that filling vacant IP positions are important and he has been pleased with the administration's appointments to date. His group, which represents major IP owners and content creators, was pleased to see two entertainment industry lawyers -- Thomas Perrelli and Donald Verrilli -- join the Justice Department. Sohn's group, the Computer and Communications Industry Association, the Consumer Electronics Association and other tech stakeholders complained in a letter to Obama that both previously represented "the concentrated copyright industries" and future appointments should be more evenhanded.
Proponents of proposed changes to the U.S. patent system are getting antsy as the increasingly packed House and Senate calendars dash their hopes for swift action on legislation this year. At its recent meeting, the Intellectual Property Owners Association board of directors adopted a resolution urging the Senate to bring a bill sponsored by Judiciary Chairman Patrick Leahy to a vote soon. The bill passed his committee in April and staffers for Leahy and Majority Leader Harry Reid have begun discussing how and when to move the measure to the floor. "We are still taking a look at this complicated issue and how it fits into the broader floor schedule," a spokeswoman for Reid said Friday. Supreme Court nominee Sonia Sotomayor and other judicial appointments will consume much of Leahy's time in the weeks ahead.
IPO's board approved a number of other resolutions for 2009, including:
• Support for legislation to repeal the qui tam cause of action of Section 292(b) of the patent statute for false marking of products.
• Support for U.S. Customs and Border Protection statutory and regulatory authority over design patents by creating a registry similar to what currently exists for goods protected by trademarks or copyrights.
• Opposition to legislation that does not respect the essentially territorial nature of patent rights by providing that it shall not be an act of infringement in the United States to use, offer to sell, or sell within the United States, or import any patented invention based on first sale abroad of the patented invention by or under authority of the owner or licensee of an applicable U.S. patent or corresponding foreign patent.
Read more IPO resolutions here.
Senate Judiciary Chairman Patrick Leahy on Thursday reaffirmed his commitment to moving forward on several technology-related measures this summer. In opening remarks at his panel's first business meeting since Memorial Day recess, he stressed the importance of voting on a number of key judicial nominees, which have stalled in his committee, so members could begin to advance their legislative priorities on the intellectual property front. "Both the list of nominees and our legislative agenda continue to grow with new and important matters. We really need to make progress," Leahy said. While Supreme Court nominee Sonia Sotomayor will consume much of the committee's time in the weeks ahead, the Performance Rights Act is still among his top priorities. That bill would end a long-standing copyright royalty exemption afforded to AM and FM radio stations that has been backed by the music business but panned by broadcasters.
Leahy also said he wants the Judiciary Committee to consider provisions of the USA PATRIOT Act that are slated to sunset on Dec. 31. The expiring sections include a "roving wiretap" provision that allowed government bugs on a phone used by a person being tapped as well as language broadening law enforcement access to library and bookstore patrons' records. Also set to sunset is a "lone wolf" amendment to a related intelligence law that covers a noncitizen who engages in or prepares for international terrorism. Another bill awaiting action would extend the Satellite Home Viewer Act, "so that those of our constituents who watch television through satellite reception do not see their service interrupted," Leahy said. The statute permits satellite systems to retransmit local and distant TV signals into markets across the country.
A non-binding resolution opposing legislation that would end a long-standing royalty exemption granted to AM and FM radio has gained majority support in the House. The measure, which was sponsored by Texas Reps. Gene Green, a Democrat, and Republican Mike Conaway, had 219 cosponsors as of Tuesday, aides said. The latest additions that put it over the 50 percent mark were Reps. Ron Kind, D-Wis.; Bob Inglis, R-S.C.; Dale Kildee, D-Mich.; Gus Bilirakis, R-Fla.; Leonard Lance, R-N.J.; Shelley Berkley, D-Nev.; Harry Teague, D-N.M.; Ben Ray Lujan, D-N.M.; Ed Royce, R-Calif.; and Allyson Schwartz, D-Pa. In the 110th Congress, Green's resolution gathered more than 220 backers.
"This is our base whip list," Green said in a recent interview. "This is nonbinding but if someone signs on and votes another way, they'd have to explain that to a lot of constituents." If the House royalty bill, which is sponsored by Judiciary Chairman John Conyers and has already cleared his committee, makes it onto the floor, Green said he hopes he will have enough supporters to vote it down. News of the mounting opposition came as Conyers hosted a town hall meeting in Detroit aimed at drumming up support for his bill, which would give a boost to performers and record labels. Minority owned Radio One, which has several stations in the Motor City has panned the measure, arguing it could put some broadcasters out of business.
Meanwhile, the MusicFirst Coalition, which supports the Conyers bill, circulated an annotated side-by-side comparison [PDF] of the legislation and Green's resolution on Monday in an attempt to debunk critics' claims. A number of changes were made during House Judiciary Committee deliberations that proponents believe would lessen the burden on small and medium-sized stations as well as minority broadcasters.
The Supreme Court agreed Monday to consider what types of business methods qualify for patent protection in a case with ramifications for the software, biotechnology and financial services industries, Bloomberg News reported. The justices said they will review a lower court decision that narrowed the class of patentable inventions, excluding some innovations that do not have a physical component. Because it came from the federal appeals court that handles all patent appeals, the ruling had marked a watershed in U.S. intellectual property law. The case (Bilski v. Doll) will mark the first time since 1981 the Supreme Court has ruled on the types of innovations covered by the U.S. Patent Act.
Computer and Communications Industry Association President Ed Black said he was pleased with the additional opportunity the case provides for legal clarity. "The lack of limits on patentable subject matter as a result of the State Street decision has created chaos in the marketplace and provided fertile breeding ground for patent trolls," he said. "We are pleased by the federal circuit decision in Bilski because it cuts back on what has been an extremely problematic area in the patent system that stems from granting patents on abstract subject matter. We hope the Supreme Court will return to the wisdom of its earlier rulings and affirm strong principles about the limits of patentable subject matter."
More details about the case: Patently-O Blog, SCOTUS Blog, The 271 Patent Blog.
House Judiciary Chairman John Conyers hopes some star power will help drive support in Detroit for legislation he has championed that would end a long-standing royalty exemption granted to AM and FM radio. Conyers and Rep. Sheila Jackson Lee, D-Texas, will host a town hall meeting on Tuesday at Wayne State University where a chorus of prominent music industry representatives will lend their voices to the cause. Conyers has invited Dionne Warwick, Martha Reeves of Martha and the Vandellas, Duke Fakir of The Four Tops, Sam Moore of Sam & Dave. Also scheduled to appear are musician Ralph Armstrong, Rhythm & Blues Foundation Executive Director Kendall Minter, Industry Ears co-founder Paul Porter, American Federation of Musicians Local #5 President Gordon Stump, Metro Detroit AFL-CIO's Saundra Williams and Tony Gray, president of Gray Communications.
The Performance Rights Act, which passed the House Judiciary Committee recently, has been panned by the National Association of Broadcasters and was the focus of protests by black radio stations in Conyers' congressional district. On Capitol Hill, he has stressed important carve-outs in his bill aimed at minority owned and small radio stations. The changes earned Conyers the support of the Leadership Conference on Civil Rights, the NAACP and a number of unions. Now his aim is to "set the record straight" about his legislation outside of the Washington echo chamber. Earlier this month, the Michigan Broadcasters Association vowed to defeat the legislation, claiming it could cost stations in the state more than $63 million annually. Radio One founder Cathy Hughes wrote an open letter arguing the bill would "murder black owned radio."
The intellectual property policy parlor game of guessing who the next Patent and Trademark Office director will be has zeroed in on several names in recent months -- Q. Todd Dickinson, who already ran the agency under former President Bill Clinton; David Kappos, who is vice president and assistant general counsel for IP at IBM; and Jim Pooley, a Silicon Valley lawyer who was recently nominated to become deputy director of the World Intellectual Property Organization. But with Pooley effectively out of the mix, another name has bubbled to the surface: Doug Luftman, associate general counsel for Sunnyvale, Calif. smartphone manufacturer Palm.
Luftman has at least one cheerleader in Congress, Rep. Michael Honda, D-Calif, vice-chair of the House Appropriations Legislative Branch Subcommittee, who wrote to the White House director of presidential personnel recommending him for the job. Although the letter was not made public, a spokesman for Honda said his boss believes Luftman's key asset "is his knowledge of the patent process from idea to product." Luftman has followed the product development process from the industry viewpoint at Palm and before that as general counsel of Caspian Networks; at CIENA Corp., and at Intel. He also worked for Fenwick & West's Silicon Valley office. Honda's aide said Luftman "recognizes the disarray" of the PTO and has management experience that could help.
House Judiciary Committee members Rick Boucher, D-Va., and Bob Goodlatte, R-Va., introduced legislation Thursday to restrict filing patents to protect tax strategies. Last Congress, a more expansive patent bill approved by the House included the language but a companion Senate bill that did not include the provision stalled. This time around, neither patent bill includes the text, which Boucher and Goodlatte believe is critical. "When one individual or business is given the exclusive right to a particular method of complying with the tax code, it increases the costs and complexity for every other citizen or tax preparer to comply," Goodlatte said. A situation could arise where taxpayers are forced to choose between paying a royalty in order to reap the best tax treatment, and complying with the tax code in another, less favorable way, he said.
In recent years, many individuals have been granted patents that protect tax planning methods, or strategies used by taxpayers and tax advisors to develop plans to reduce, minimize or defer tax liability, the pair said in a press release. Despite abiding by the letter and spirit of tax laws enacted by Congress, unknowing taxpayers and certified public accountants who advise clients on tax plans may be infringing on these patented tax strategies. The infringement could result in payment of damages, attorneys' fees, and other remedies. As of April 1, there were 77 patents for tax planning methods, with 125 tax planning method patent applications pending, officials said. The House Judiciary Committee held a hearing on the larger patent bill in April.
The Copyright Alliance, which represents NBC, News Corp., Time Warner and other companies with a huge stake in intellectual property protection, launched a new non-profit charitable arm Thursday that will develop educational programs aimed at helping America's next generation of creators succeed. The foundation's projects, already underway, include: development and distribution of a copyright curriculum for educators; and a partnership with the West Potomac Academy of Fairfax County Public Schools in Virginia, to refine Alliance curriculum materials and supplement them with information important to arts education. Alliance Executive Director Patrick Ross will serve as the foundation's chairman and Gayle Osterberg, who has managed public relations and education initiatives for the group, will serve run the foundation.
"Our nation has reaped the rewards both culturally and economically of the principle and practice of copyright," Ross said in a press release. "This system has served us well for centuries - so much so, that it has become an invisible underpinning in our country's prosperity. Now, as a new generation of creators populates today's classrooms, we must ensure that principle is not taken for granted and continues to be a foundation for creative success." The group's "Think First, Copy Later" pilot curriculum for teachers has been distributed to 5,000 librarians and media specialists this spring to gauge usefulness. Schools including West Potomac Academy will provide more detailed feedback. The materials will be distributed more broadly prior to the 2009-2010 schoolyear.
Amid protests by black radio stations back home in Detroit and growing opposition on Capitol Hill, House Judiciary Chairman John Conyers is stressing important carve-outs in a bill he introduced that would end a long-standing royalty exemption for AM and FM broadcasters. Conyers, whose committee approved his bill last week, released a statement Tuesday touting modifications he made to the bill with the help of Congressional Black Caucus members. The amended measure creates a sliding scale where small stations would pay as little as $500 a year. Three-quarters of America's radio stations will be eligible for the scale and 90 percent of black-owned stations would be protected, he said. Additionally, all music stations that gross less than $1.25 million annually will be eligible for a flat fee.
Due to the current economic conditions that have hit both musicians and broadcasters particularly hard, he and his colleagues changed the bill so stations that gross more than $5 million per year will be on the hook for payment one year after enactment. For stations that gross less than $5 million per year, no royalties will be due for three years. "I know times are tough, and it is not the intention or goal of this legislation to drive broadcasters into bankruptcy or to bring about a widespread consolidation of the industry. That is why I have been, and remain, committed to finding a middle ground on this issue," Conyers said.
To further sweeten the pot, Conyers, Judiciary ranking member Lamar Smith and others requested that the Government Accountability Office conduct a study on the impact of the legislation on diversity in media, including minority and minority-owned, female and female-owned, and religious broadcasters and artists. The bill would direct the Copyright Royalty Board to factor in the study's results when determining the rate, so that the impact on minority, female, and religious broadcasters and artists will be taken into account. The compromises earned Conyers the support of the Leadership Conference on Civil Rights, the NAACP and a number of unions.
The Congressional International Anti-Piracy Caucus on Wednesday will unveil its 2009 watch list of countries that maintain inferior intellectual property protection regimes. The annual release comes on the heels of the Office of the U.S. Trade Representative's own analysis known as the "Special 301" report, which was made public in late April. Traditionally, the two documents are closely aligned in the nations they put in the spotlight. Rampant illicit copying of compact discs, online sharing of movies and music, and other violations in China, Russia, Spain and Thailand were emphasized by the USTR and Canada was added to the agency's "priority watch list" at the behest of U.S. music, movie, software and video-game industries.
At the time, Sen. Orrin Hatch, R-Utah, said Canada's spot on the list next to China and Russia "underscores how widespread Internet piracy has become" and that legislative steps are needed. Hatch co-chairs the Caucus with Sen. Sheldon Whitehouse, D-R.I. and Reps. Adam Schiff, D-Calif., and Bob Goodlatte, R-Va. The USTR report, now in its 20th year, moved Algeria and Indonesia to priority status and removed South Korea from a lower-level list in recognition of improvements its government has made since 2008. Caucus members will be joined at the briefing by Motion Picture Association of America Chairman Dan Glickman; Entertainment Software Alliance President Mike Gallagher; Business Software Alliance President Robert Holleyman and others.
As Congress gets ready to take off for a week-long recess following Memorial Day, the Senate Commerce Committee holds a Tuesday hearing on two key tech-related nominations: Larry Strickling to head the National Telecommunications and Information Administration -- which is part of the Commerce Department -- and Aneesh Chopra, now Virginia's secretary of technology, to serve as the nation's first chief technology officer. Confirming Strickling -- a former telecom executive, FCC official and adviser to President Obama's 2008 campaign -- is a priority, given the forthcoming June 12 switch to digital television broadcasts and the NTIA playing a major role in the distribution of $7.2 billion in broadband funds contained in the Obama economic stimulus program. The hearing gets underway at 11 a.m. in Room 253 of the Russell Senate Office Building.
Meanwhile, Homeland Security Secretary Janet Napolitano will address the National Security Telecommunications Advisory Committee Thursday, as the committee plans to discuss vulnerabilities in the federal government's information networks. The session comes as the Obama administration is expected soon to announce the findings and recommendations of a major national cybersecurity review. The Telecommunications Advisory panel is also expected to discuss satellite security issues. Portions of the meeting -- which starts at 2:30 p.m. at U.S. Chamber of Commerce headquarters, 1615 H Street, N.W. -- will be closed to the public. On a related front, FBI Assistant Director for the Cyber Division Shawn Henry and Cyber Division Section Chief Jeffrey Troy Tuesday will speak at an Anti-Spyware Coalition conference about how their agency is combating high-tech threats. The day-long session gets underway at 9 a.m. at the Grand Hyatt Washington, 1000 H Street, N.W.
An article in CongressDaily's AM Edition on Friday notes that Rep. Dana Rohrabacher, R-Calif., is an opponent of legislation intended to rework how patents are granted and litigated in the United States. Rohrabacher said at a House Science Committee hearing that the measures currently moving through the House and Senate have been driven by major high-tech firms that are "trying to destroy the patent system." The story points out that Rohrabacher's top 2008 campaign donor was Intellectual Ventures, a firm founded by Nathan Myhrvold, a former Microsoft executive who has been highly critical of changing the patent system. He also accepted money from manufacturers -- another sector that has panned portions of the legislation.
On the flip side, it is worth noting that backers of the bills -- House Judiciary Chairman John Conyers, Rep. Howard Berman, D-Calif., and Senate Judiciary Chairman Patrick Leahy -- have each benefited from the generosity of companies that have been lobbying for the legislation's passage. Conyers has accepted money from News Corp.; Berman has received funds from News Corp., Time Warner, Warner Music Group and others; and Leahy has benefited from TechNet, Time Warner, Microsoft, Google, and Cisco Systems. The Senate bill passed Leahy's committee last month and is awaiting floor time. Conyers held a hearing on his bill in April.
Tucked inside House Foreign Affairs Chairman Howard Berman's wide-ranging 320-page Foreign Relations Authorization Act for fiscal years 2010 and 2011 is a section intended to boost resources and training for intellectual property enforcement, especially in countries identified by the U.S. government as failing to live up to international obligations. Berman is a longtime leader on IP issues and chaired the House Judiciary Subcommittee on Courts, the Internet, and Intellectual Property in the 110th Congress. Under the bill, the Secretary of State would appoint 10 new IP attachés to serve in embassies or other diplomatic missions with priority placement given to countries with particularly egregious IP regimes. The White House IP Enforcement Coordinator, a position created by Congress last year that has not been filled, would coordinate the attachés' activities abroad. Berman's bill also requires the State Department to submit an annual year-end report to Congress on the appointment, designation for assignment, and activities of all IP attachés.
The effort complements one by Senate Finance Chairman Max Baucus who will soon introduce a broad trade enforcement bill that would include IP provisions. Baucus and Sen. Orrin Hatch, R-Utah, co-sponsored stand-alone legislation last Congress to beef up the USTR's "Special 301" report, but it stalled in the Finance Committee. Stakeholders have argued the report, the latest installment of which was released last month, needs more muscle. The prior Baucus-Hatch bill required trade officials to create an action plan for the worst offenders and establish harsh consequences for countries that do not comply. The bill would have given additional enforcement powers to the president, including banning federal procurement from and stopping international financing to nations that violate American IP rights. It would have also authorized a funding boost for new USTR attachés.
Read CongressDaily's recent story here (subscription required).
The French Senate overwhelmingly approved a proposal pushed by President Nicolas Sarkozy on Wednesday that gives the government the ability to disconnect Internet users who illegally download music and movies. The bill was adopted a day earlier by the parliament's lower house. Under the "three strikes" law, users who download content without paying for it will get an e-mail from a government officials followed by a letter and a third warning before their Web connectivity is cut off for as long as one year. "The new French law takes the right approach and sets an example to the rest of the world," John Kennedy, head of International Federation of the Phonographic Industry, said in a statement. "It will introduce sensible, proportionate measures that will have a real impact on piracy while respecting ordinary, legitimate Internet users."
"Creative industries everywhere, including music, film, TV and books, are facing a fundamental challenge from the way online piracy is eroding the ability of creators to get rewarded for their work," Kennedy said. "In France the government has understood better than any other country the crisis which is looming if firm action is not taken to address the problem." Sarkozy's Union for a Popular Movement majority party voted to make up for the surprise rejection of the law last month, Bloomberg reported. The Socialists Party says it plans to ask the Constitutional Council, France's highest authority, to rule on the legality of the law, Agence France-Presse said. Concerns about a similar three strikes proposal have permeated talks between the United States and a handful of trading partners as they work toward completion of an Anti-Counterfeiting Trade Agreement.
After nearly four hours of debate, the House Judiciary Committee approved a bill, 21-9, that would end a long-standing copyright royalty exemption for AM and FM radio stations, with significant concessions aimed at protecting small and minority-owned broadcasters. The action was a big win for the Recording Industry Association of America, American Federation of Musicians, the Recording Academy and others who have been pressing lawmakers to force terrestrial radio to pay performers for songs carried on their airwaves. It was a blow to the National Association of Broadcasters, which has lobbied fiercely against the bill they believe to be a "tax" on local radio.
Moments after the committee's vote, NAB issued a press release giving a nod to those who voted against the bill: Judiciary ranking member Lamar Smith; Maxine Waters, D-Calif.; Howard Coble, R-N.C.; Dan Lungren, D-Calif.; Louie Gohmert, R-Texas; Jim Jordan, R-Ohio; Ted Poe, R-Texas; Jason Chaffetz, R-Utah; and Gregg Harper, R-Miss. "We were pleasantly surprised by the considerable bipartisan opposition to a performance tax, even in a committee where support for the record labels is strongest," NAB spokesman Dennis Wharton said, noting that outside of the committee, a group of 192 House lawmakers have signed onto a resolution sponsored by Rep. Gene Green, D-Texas, opposing the bill.
The MusicFirst Coaltion, which has championed the royalty bill, cheered its committee passage. "Our continued momentum in Congress is proof that it's well past time to recognize the importance of fairly compensating the artists and musicians whose talent and hard work allows radio to generate billions of dollars in ad revenue each year," the group said. "Corporate radio's days of hiding behind a loophole in the copyright law are over," MusicFirst continued. "All other music platforms... pay artists, musicians and rights holders for the use of their music. It's only fair that AM and FM radio be held to the same standards." Read CongressDaily's PM Edition story here and the lengthier mark up report here (subscription required).
Mom-and-pop Internet radio services from across the United States wrote to House Judiciary Chairman John Conyers and ranking member Lamar Smith urging them to extend small broadcaster protections, which could be included in a bill before their committee on Wednesday, to Web sites that offer music as well. "Small webcasters are the smallest of small, but our programming is the most innovative and our playlists the most diverse," they argued in a Tuesday letter. "Small webcasters play more independent music, more local artists, and more unusual genres than broadcast radio, satellite radio and cable radio combined!" they said.
To ensure that small AM and FM stations are not bankrupted by a proposed new fee, Conyers' legislation lets let those making less than $1.25 million annually pay only $5,000 in royalties. Additionally, he is expected to offer an amendment so that radio stations earning less than $500,000 will pay only $1,250 and stations earning less than $100,000 will pay only $500. By contrast, webcasters pointed out that their sector pays far higher rates. Those earning $1.25 million pay $150,000 in royalties; webcasters earning $500,000 pay $50,000 in royalties; and webcasters earning $100,000 pay $10,000 in royalties. Read more about Conyers' legislation here, here, and here.
As CongressDaily and Tech Daily Dose reported earlier, aides for House Judiciary Chairman John Conyers have been hard at work on a manager's amendment intended to calm broadcasters' fears that legislation his committee will mark up Wednesday could harm local radio and diversity on the airwaves.
Some details have emerged about what Conyers plans to offer:
Affordable payment for small, rural, nonprofit, minority, religious and educational broadcasters: Any station that makes less than $100,000 annually will pay only $500 annually for unlimited use of music. Any station that makes less than $500,000 but more than $100,000 annually will pay only $2500 (half of the amount in introduced bill) annually for unlimited use of music. Any station that makes less than $1.25 million but more than $500,000 annually will pay only $5,000 (the amount in introduced bill) annually for unlimited use of music.
Some relief from the current economic situation: No payment for two years by any station that makes less than $5 million annually; No payment for one year by any station that makes more than $5 million annually.
Parity for all radio services: Establishes a "placeholder" standard to determine a fair rate for all radio services that will encourage negotiations between the stakeholders.
Cannot hurt local communities: Assures that this legislation cannot affect broadcasters public interest obligations to serve the local community.
Assures consideration of relevant evidence: Evidence relevant to small, noncommercial, minority, and religious broadcasters and religious and minority royalty recipients must be considered by the Copyright Royalty Judges.
CongressDaily's AM Edition reports that House Judiciary Chairman John Conyers on Wednesday will try to calm broadcasters' fears that legislation he co-sponsored with Oversight and Government Reform ranking member Darrell Issa could harm local radio and diminish diversity on AM and FM airwaves. When Conyers' panel marks up the bill, which would end a long-standing copyright royalty exemption for over-the-air radio, he plans to propose slashing the fee small commercial stations would have to pay performers and record labels. Rather than paying the flat $5,000 annual royalty proposed in the current version, Conyers' potential amendment would require the smallest stations to offer as little as $500 per year while others that generate less than $1.25 million in annual revenue would pay based on a sliding scale.
Another possible amendment would create a two-year payment delay for a number of small stations with the hope that the economy will rebound, Hill sources said Monday. A third potential proposal would require AM and FM radio to be held to the same rate standard as cable, Internet and satellite radio, which currently pay performers under dissimilar fee structures. Sen. Dianne Feinstein, D-Calif., pushed the "platform parity" idea last Congress as a similar bill sponsored by Judiciary Chairman Patrick Leahy was being debated in his committee. Leahy reintroduced his measure in February but has been focused on patent legislation. Under Feinstein's January 2007 proposal, various platforms would pay a fair market value for the performance of digital music and would require the use of anti-piracy technologies that are technologically and economically feasible.
Meanwhile, broadcasters are complaining that the Conyers bill could harm local radio and diminish diversity on AM and FM airwaves. Radio One CEO Alfred Liggins argues his sector is in dire straits and they cannot afford to pay performers. Liggins, whose enterprise is the largest minority-owned U.S. media company, owns several stations in Conyers' congressional district and over the last 18 months has laid off 21 employees. As the legislation moves forward, Liggins said he would direct his on-air talent in Detroit to take to the airwaves in opposition. Read more in CongressDaily here.
The United States, Japan, New Zealand, and Luxembourg had the lowest rates of software piracy in the world in 2008 -- all near 20 percent -- while Armenia, Bangladesh, Georgia, and Zimbabwe had the highest instances of infringement, each with over 90 percent, according to the Business Software Alliance's sixth annual piracy study with market research and forecasting firm IDC. The report, being released Tuesday, shows that governments are software firms are making progress in slowing the spread of illegal programs but progress has stalled in the United States and the challenge is greatest in the world's fastest growing emerging markets.
Overall, the rate of PC software piracy last year dropped in about half (52 percent) of the 110 countries studied and remained the same in about a third (35 percent), the study found. However, the worldwide piracy rate went up from 38 percent in 2007 to 41 percent in 2008 because PC shipments grew fastest in high-piracy rate countries. Meanwhile, piracy-related losses to legitimate software vendors grew by more than $5.1 billion (11 percent) to $53 billion from 2007 to 2008, although half the growth stemmed from changing exchange rates. Excluding the effect of exchange rates, losses grew by 5 percent to $50.2 billion and the legitimate software market grew by 14 percent.
"We are continuing to make progress against PC software piracy in many countries, which helps people working in the U.S.-led global software industry. That's the good news," BSA President Robert Holleyman said in a press release. "The bad news is that PC software piracy remains so prevalent in the United States and all over the world. It undermines local IT service firms, gives illegal software users an unfair advantage in business, and spreads security risks." BSA noted the impact of the economic crisis appeared to be muted in its effect on piracy in 2008, in part because significant spending cutbacks did not start until late in the year. Read the full report here.
Rep. Jay Inslee, D-Wash., will reintroduce a bill Tuesday that will allow many months of royalty negotiations between the music and Internet industries continue while delaying full implementation of a controversial rate-setting for webcasters imposed by the Copyright Royalty Board. The legislation, which will be cosponsored by Judiciary Chairman John Conyers, Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., and California Democrats Zoe Lofgren and Anna Eshoo, is simple but effective, sources said. It would replace a Feb. 15, 2009 deadline that was part of legislation that passed the 110th Congress, with a 30-day window from the date of enactment for a deal to be reached between digital royalty collector SoundExchange, which is negotiating on behalf of copyright owners and performers, and Internet radio services represented by the Digital Media Association and others.
The bill is on a fast-track and is scheduled to be marked up by Conyers' committee the following day. Sen. Ron Wyden , D-Ore., sponsored a companion measure last session but it was unclear whether he planned to follow Inslee's lead. SoundExchange and the National Association of Broadcasters already reached agreement on Internet radio royalties earlier this year that provides discounts on previously set rates for 2009 and 2010 and establishes rates for 2011-2015. Under the arrangement, which involves AM and FM radio stations that simulcast programming over the Internet or that create new stand-alone Internet stations, simulcasts or Web channels operated by local stations are reduced for the first two years by about 16 percent then gradually increase through 2015 -- from $0.0015 per streamed sound recording in 2009 to $0.0025 per stream by 2015. Read more on the topic here.
Update: A spokeswoman for Wyden confirmed late Monday that her boss would be introducing the Senate version of the bill, potentially this week.
The Leadership Conference on Civil Rights, Jesse Jackson's Rainbow PUSH Coalition and the Lawyers' Committee for Civil Rights Under Law this week urged the House Judiciary Committee to delay any action on legislation that would end a longstanding royalty exemption for AM and FM radio until the panel holds a hearing to weigh the bill's impact on minority-owned broadcast radio stations. Noting "two significant voting rights cases" before the Supreme Court, the groups explained that "the chief remaining resource to ensure that African Americans can participate fully in the democratic process will be the continued engagement of minority radio broadcasters to drive turnout."
Passage of the Performance Rights Act, which was sponsored by House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy, "would eviscerate this remaining, powerful resource," the letter from Rainbow PUSH and the Lawyers' Committee said. LCCR sent a separate letter to Conyers expressing similar concerns. The letters raise "important questions regarding the negative impact of the performance tax on minority broadcasters, niche programming formats and media diversity," said Dennis Wharton, a spokesman for the National Association of Broadcasters, which is leading the lobbying effort against the legislation. He added that "minority broadcasters often serve as the only voice for African-American and immigrant communities."
Trade groups representing Internet music providers, e-commerce firms and electronics manufacturers fired back this week at an attempt by composers, songwriters and performance rights organizations (PROs) to persuade House and Senate Judiciary Committee leaders to amend copyright law to extend the "public performance right" so that it will apply to digital downloads of audiovisual works. The Digital Media Association, the Consumer Electronics Association, TechAmerica and others claim the request by ASACP, BMI, the Harry Fox Agency and the Songwriters Guild of America, would "impose a licensing obligation and potentially significant royalties on activities that are unequivocally unrelated to public performance."
This debate could complicate an ongoing examination by both committees of bills sponsored by House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy that would bring AM and FM radio in line with Internet, cable and satellite music platforms that pay performers for their works. Groups like the Recording Industry Association of America, SoundExchange and the American Federation of Musicians are carrying the torch for that effort while over-the-air broadcasters who have long been exempt from the fee argue it should remain that way. The National Association of Broadcasters claims the bills could bankrupt local radio.
Rep. Zoe Lofgren, D-Calif., has become increasingly concerned about the Anti-Counterfeiting Trade Agreement, which has been in the works, largely behind closed doors, for more than a year. Amid fears from watchdog groups who argued the process between the U.S. government and a handful of key trading partners was too secretive, the Office of the U.S. Trade Representative in April released a six-page summary of ACTA talks. Lofgren told a crowd of high-tech executives Wednesday the outline may not be sufficient in quelling fears about requirements that could be imposed on Internet service providers and others. She said the document "makes me very nervous," particularly as European proposals have surfaced to regulate ISPs as part of efforts to crack down on copyright infringement.
In her remarks to the Computer and Communications Industry Association, Lofgren also spoke about the congressional movement to overhaul the U.S. patent system. Silicon Valley executives told her in recent meetings that a compromise bill, which last month passed the Senate Judiciary Committee, could be worse than no bill at all due to what they believe is watered down damages language. "Last year we had a strong bill," Lofgren said of the version that passed the House. The Senate measure stalled last spring after Judiciary Chairman Patrick Leahy and then-ranking member Arlen Specter could not see eye to eye on damages text. "Now we have a bill that opponents of patent reform are rallying around," she said of Leahy's legislation as amended.
Lofgren also said the so-called "orphan works" issue is still on her radar. Legislation aimed at reworking a portion of U.S. copyright law that deals with musical tracks, writings, images, videos or other content whose owners cannot be easily gained some traction in the 110th Congress but did not make it to the House floor. Later in her speech, Lofgren said a bill she sponsored to provide for a five year moratorium on any new discriminatory wireless tax or fees should collect "a lot of cosponsors on both sides of the aisle." "I think we have an opportunity to move that," she said.
High-tech attorney Jim Pooley, one of several top contenders for the job of Patent and Trademark Office director, has confirmed to Tech Daily Dose his nomination to become deputy director of the World Intellectual Property Organization. Pooley is a partner in the litigation department of the Palo Alto office of Morrison & Forrester and has practiced in Silicon Valley since 1973. He is immediate past president of the American Intellectual Property Law Association and president of the National Inventors Hall of Fame. Foley & Lardner IP attorney Hal Wegner noted in an email that when an American is sent to WIPO, the final decision rests with the State Department and that is usually based upon the recommendation of the PTO. It would go against tradition to name this spot without the input of the new PTO chief, he said. Pooley is part of a slate of WIPO nominees that are subject to election. The list of candidates should be announced soon, Wegner said. Other names in the mix for the PTO job include Q. Todd Dickinson, who already ran the agency under former President Bill Clinton, and David Kappos, who is vice president and assistant general counsel for IP at IBM.
Fans and foes of legislation that would end a longstanding copyright royalty exemption granted to AM and FM radio are each hoping to win the support of Hispanic members of the House and Senate. The Free Radio Alliance and the National Association of Broadcasters, which believe the proposal would slap a "tax" on local radio, held a Tuesday briefing on Capitol Hill with Eddie "Piolin" Sotelo, host of a popular morning show on Univision Radio and radio executives from Salem Communications, Entravision Communications, Top Line Broadcasting and others. Panelists discussed how the legislation would impact diversity in voice and thought in the Spanish-language radio market and broader problems they have with the bills, which were sponsored by House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy.
In a same-day press release, the MusicFirst Coalition pointed out that the National Hispanic Conference of State Legislators recently approved a resolution that calls on Congress to pass the Performance Rights Act. In its resolution, the organization that represents Hispanic state legislators noted that broadcasters enjoy a "unique government-created exemption from having to compensate creators" and that AM and FM radio stations are the only "radio platform that does not compensate creators." MusicFirst Executive Director Jennifer Bendall, whose group is backed by record labels, unions and other industry stakeholders, said grassroots Hispanic policymakers are "strong supporters" of the legislation and their voice is an essential part of the debate. The Congressional Hispanic Caucus has not formally weighed in but the Spanish Broadcasting Association has urged opposition.
Attorneys general from 39 states wrote a letter to House and Senate Appropriations Committee members this week urging them to fully implement and fund legislation passed by Congress and signed into law last October, which would enhance domestic intellectual property protections. The statute seeks to bolster the ability of state and local law enforcement to protect IP by authorizing funding for related programs. The state AGs pressed lawmakers to provide $25 million in fiscal year 2010 for IP enforcement grants administered by the Justice Department's Office of Justice Programs." The funds would be used to "pay for law enforcement training programs, public education programs, the establishment of federal-state-local task forces, and certain special expenses incurred through efforts to combat counterfeiting and piracy," they wrote.
Signatories included attorneys general from Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, and West Virginia. The U.S. Chamber of Commerce's Global IP Center lauded the letter. "State and local law enforcement play a pivotal role in protecting jobs and consumers from intellectual property crimes," Center Executive Vice President Mark Esper said. "We look forward to working with Congress to make sure these needed funds are invested."
The House Judiciary Committee begins its work to overhaul the U.S. patent system on Thursday. Some recent coverage from CongressDaily...
House Judiciary Ranking Member Pushes Patent Reform Plan
House Judiciary ranking member Lamar Smith will urge colleagues at a hearing on patent legislation today to move forward with a proposal to enhance patent quality, discourage frivolous litigation and harmonize international patent principles. Smith joined Judiciary Chairman John Conyers to co-sponsor a bill he believes promotes those goals better than a version that passed the Senate Judiciary Committee this month. "Members of this committee are not passive participants who will accept whatever the other body hands us," Smith said in a statement. The Texas Republican is concerned with changes Senate Judiciary Chairman Patrick Leahy made to language that impacts how damages are awarded in patent infringement lawsuits. (Thursday, April 30, 2009)
Boehner Leads New Republican Push For Patent Reform
House Minority Leader John Boehner and some other top Republicans are among more than 20 members sending a letter today to House Speaker Nancy Pelosi stressing the need for major changes to the U.S. patent system. The communique comes one day before the House Judiciary Committee is set to examine the issue. Supporters of a patent bill introduced in March by Judiciary Chairman John Conyers and ranking member Lamar Smith were heartened by Boehner's involvement because he worked against a similar measure that passed the House in 2007. But companies like Google, Microsoft and Time Warner, which have lobbied Congress to overhaul how damages are awarded in patent lawsuits, might want to hold their applause. A Boehner spokesman pointed out the letter did not mention Conyers' bill by name. (Wednesday, April 29, 2009)
The House Judiciary Committee on Wednesday evening formally announced the witness list for its first hearing of the 111th Congress to discuss potential changes to the U.S. patent system. The hearing takes place Thursday morning and the line up includes:
Intel Chief Patent Counsel David Simon
Georgetown University Law School Professor John Thomas
Segway inventor Dean Kamen
Tessera General Counsel Bernard Cassidy
Johnson & Johnson Chief Intellectual Property Counsel Phillip Johnson
Vertical Group Partner Jack Lasersohn
Cisco Systems Senior Vice President Mark Chandler
House Minority Leader John Boehner and some other top Republicans weighed in on the patent debate on the eve of the hearing with a letter to House Speaker Nancy Pelosi. The communique from the House Republican High-Tech Working Group, which was signed by more than 20 members, pressed for patent reform but did not mention Conyers' bill by name. A Boehner spokesman said his boss "has never been opposed to all patent reform, just to legislation that picks winners and losers in the private sector." For more details, CongressDaily's Wednesday AM Edition story here (subscription required).
The National Association of Broadcasters is ratcheting up its lobbying blitz against legislation currently moving through the House and Senate that the trade group believes would cost jobs and kill off local radio stations' offerings. The bill, which would end AM and FM stations' exemption from paying copyright royalty fees to performers of the songs that grace their airwaves, is being targeted in a series of new advertisements in the Washington Metrorail system. Their 45 banners are plastered across the Capitol South metro station, which is located two blocks from the U.S. Capitol. The NAB also recently launched NoPerformanceTax.org to beef up its campaign to defeat the bill, which is championed by music industry interests like the Recording Industry Association of America, the American Federation of Musicians, and the Recording Academy.
"Every week, radio airplay reaches 235 million Americans, promoting both new and legacy artists and generating more than a billion dollars in CD and download sales for record labels annually. By contrast, artists routinely sue their record labels for cheating them out of royalty money," an NAB spokesman said in a press release. "We welcome an honest debate over which side has been a better friend to recording artists: America's hometown radio stations or foreign-owned record labels." An official with the MusicFirst Coalition, which supports the bill, said: "No amount of advertising can right a wrong. Corporate radio earns billions without compensating the artists and musicians who bring music to life and listeners ears to the radio dial. Satellite radio, Internet radio and cable music stations pay a fair performance royalty, as so radio stations throughout the world."
Legendary jazz singer Tony Bennett visited Capitol Hill Tuesday evening to lobby for legislation that would end a longstanding copyright royalty exemption afforded to AM and FM radio stations. He attended a reception organized by the MusicFirst Coalition, which drew a handful of House and Senate members and their aides. Read more about the hot topic in National Journal magazine's April 18 issue here (subscription required). Music industry stakeholders who support the legislation expect a mark up in the House Judiciary Committee soon. Judiciary Chairman John Conyers is pictured above with Bennett and Rep. Sheila Jackson-Lee, D-Texas.
More photos after the jump...
Rep. Brad Sherman, D-Calif., wrote to members of the Canadian Parliament last week urging them to address inadequacies in the country's intellectual property rights enforcement regime. His letter came on the heels of an April 6 House Foreign Affairs Committee field hearing in California that heard from music and movie industry representatives who named the United States' northern neighbor -- along with China and Russia -- as havens for major piracy operations. Specifically, Sherman pressed Canada to provide its customs officials with ex officio seizure power. Currently, they lack the statutory authority to seize counterfeit products unless they have previously obtained a court order.
"Canada has not acceded to nor implemented World Intellectual Property Organization Internet treaties," he wrote. "Canada has continued to resist a 'notice and takedown' regime that would require Internet service providers to terminate the accounts of repeat or serious IPR infringers." Additionally, Sherman said Canada has not enacted rules clarifying that rights holders can get damages awards against entities that intentionally facilitate massive infringement. "Pirated goods are not just an economic concern but often times represent a serious threat to public health safety," the lawmaker noted. "Canada must assist its partner countries in making sure that dangerous goods do not cross its borders," he concluded.
Last May, the Congressional Anti-Piracy Caucus slammed Canada for failing to update its IP enforcement regime despite promises to the contrary and the passage of a 2007 law that banned movie-theater videotaping of films. Earlier this year, the International Intellectual Property Alliance urged the U.S. Trade Representative to place Canada on its list of countries that warrant enhanced attention due to IP problems. The USTR's annual "Special 301" report, which highlights IP deficiencies and advancements of trading partners, is due out later this week.
The United States and European Union must be united in their approach to fighting intellectual property crime, former Commerce Secretary Carlos Gutierrez told a transnational conference on IP enforcement on Monday. "We probably have the most at stake," he said at the event hosted by the U.S. Chamber of Commerce. "It is a necessary partnership. Without it, I don't think we can fight [counterfeiting and piracy]." Gutierrez, who served in the Bush administration Cabinet from 2005 to 2009 and now works with the influential business group on trade policy, said solutions to many challenges in this arena "will come from the industries that rely on IP." "We have to innovate our way out of the crisis," he said. Gutierrez pointed to the fact that major U.S. brands were born during previous economic downturns. In the 1980s, Microsoft and Genentech came into being and during the Great Depression, companies like Hewlett-Packard and Texas Instruments emerged. "We have the ability to emerge successfully from this recession but it depends on our ability to protect IP," he stressed. "Now more than ever we can't allow for a world trading system to emerge where somehow intellectual property rights aren't protected." Read more about the conference in CongressDaily's PM Edition.
Vice President Joe Biden promised movie and television executives Tuesday night that the administration will "find the right person for intellectual property czar," a still vacant White House position created by Congress last year. During a dinner that capped off the Motion Picture Association of America's Business of Show Business symposium, he told the crowd that the Obama team understands the film industry needs more resources dedicated to FBI enforcement of anti-piracy laws and more resources for prosecution, according to a pool report. He also blasted the Chinese government's IP regime that he argued "remains largely ineffective." China routinely tops the U.S. Trade Representative's annual "Special 301" report showing countries that are doing little to deal with IP theft. The latest rankings are due out later this month.
Following on last year's USTR report, Biden also singled out Canada as a country that needs stronger IP laws. In contrast, India has done a much better job combating piracy. As a result, "Bollywood is a pulsing, thriving industry," he said. Biden was there to deliver a "simple message from the president and from me: We get it. We understand the immense value of your films and all of your art, and its effect on the economy, and, I might add, on the national character." "That Hollywood sign shadow stretches all the way across America," Biden said. "You provide jobs that a middle class family can live on."
Also attending the MPAA's dinner were a number of senators including Judiciary Chairman Patrick Leahy; Majority Whip Richard Durbin; Sheldon Whitehouse, D-R.I.; Frank Lautenberg, D-N.J.; Judd Gregg, R-N.H.; Amy Klobuchar, D-Minn.; Roger Wicker, R-Miss.; and Ben Nelson, D-Neb., according to the pool report. Earlier in the day, the MPAA heard from Commerce Secretary Gary Locke, House Energy and Commerce Chairman Henry Waxman, House Judiciary Chairman John Conyers and others. Read CongressDaily's AM Edition (subscription required) for more details.
When Andrew Noyes and I worked on this week's National Journal story about the lobbying battle between the music industry and radio broadcasters over royalty fees, first quarter 2009 lobbying figures weren't available yet. Under the Lobbying Disclosure Act, neither side was required to make their lobbying numbers public until the April 20 filing deadline. Now we have those numbers so we can shed some light on one of the arguments in the battle: Both sides accuse the other of trying to win by outspending their opponent.
SoundExchange, the non-profit group that is funding the music industry's lobbying battle, reported that it spent $540,000, double the $200,000 it reported spending in the first quarter of 2008. The Recording Industry Association of America, which is a member of SoundExchange, reported spending $1.8 million in the first three months of 2009, up from the $1.54 million the organization spent during the same period a year ago. The National Association of Broadcasters, which is battling the music industry on behalf of radio broadcasters, reported spending $2.6 million, up from $2.49 million they spent in the first quarter of 2008.
Both sides are racking up big lobbying fees in roughly equal measure. -- Bara Vaida
When it comes to congressional passage of a patent reform bill, the devil will be in the details, the chief judge for the U.S. Court of Appeals for the Federal Circuit told the Intellectual Property Owners Association international judges conference Monday. If a bill passes the House and Senate, Judge Paul Michel said he would expect it to include language that would change the United States from a "first to invent" to a "first to file" patent system. That modification is one of many proposed in legislation sponsored by Senate Judiciary Chairman Patrick Leahy and House Judiciary Chairman John Conyers. "On the other details stay tuned and stay involved," Michel said. Leahy's panel passed its patent bill before Easter recess and the senator's staff will soon start looking to secure floor time for a vote. But leadership aides have warned that this work period is a busy one and the legislation may have to wait. The House has not yet begun work on its bill. Michel said he believes there is a "substantial likelihood" some version of a patent bill will clear this year, potentially by the end of the summer.
During his talk, Michel pointed out several key intellectual property positions that are vacant. The Patent and Trademark Office, which he called a "highly stressed institution," still lacks a director and the newly created job of IP enforcement coordinator within the White House has not been filled. Both will be extremely important posts going forward, Michel said. On the international front, The World Intellectual Property Organization is in search of a deputy director. "It is conceivable that job could be filled by an American," the judge said. "Even in my own court, there is the prospect of a considerable changeover of membership," Michel added. Of the 12 active fulltime judges, four are already eligible to retire or assume senior status and within two years an additional four will fall into that category. Meanwhile, his court and others are struggling to keep pace with IP lawsuits and the PTO and its counterparts around the world are dealing with huge application backlogs and long pendency times. "It's ironic that in a world where the pace of commerce and news and innovation keep getting faster, the patent offices are getting slower," Michel said.
A collection of unions, artists' alliances, companies, trade associations and research organizations whose livelihoods depend on solid intellectual property protections wrote to President Obama Monday countering what they believe is a "false dichotomy" espoused by high-tech groups who suggested in a letter earlier this month that there is a conflict between the rights of authors and inventors and the need for innovation or creativity. "The authors of the April 2 letter would have you believe that you must choose between safeguarding IP protection on the one hand and promoting innovation on the other. This supposed conflict is itself an invention," the new letter stated. The communiqué was signed by Association of American Publishers, Business Software Alliance, Copyright Alliance, Motion Picture Association of America, Recording Industry Association of America and many more. The previous memo was sent by the American Library Association; Center for Democracy and Technology; Computer and Communications Industry Association; Consumer Electronics Association and others.
"Intellectual property drives innovation and creativity, from the production of new creative works to the development of consumer electronics and medicine," the group of IP crusaders wrote in the Monday letter. "Your administration, like the transition team that preceded it, reflects a diversity of experience and viewpoints on the full spectrum of issues, including IP policy. The hallmarks of your administration's appointees have been competence, substantive expertise, and a commitment to your administration's agenda." The earlier letter pointed to two senior officials in the Justice Department -- Thomas Perrelli and Donald Verrilli -- as examples of nominees who previously represented "the concentrated copyright industries." The new letter from the IP community said Obama has demonstrated knowledge about the importance of copyright, patents and trademarks to the U.S. economy. "We appreciate the fact that such knowledge will be a key qualification for any future appointee to an IP policy position in your administration," the group said.
From the latest issue of National Journal magazine...
For decades, singers and record labels have tried to convince Congress that a gap in the country's copyright law has been allowing AM and FM radio stations to rip off artists. Radio broadcasters must pay a fee to songwriters and publishers for each song they play, but because of a long-standing exemption in the copyright law the performers themselves get nothing. "My recordings have been played worldwide with no amount of compensation coming to Dionne Warwick," the singer said at a Capitol Hill press briefing in February. "I think it's about time that I do get paid." Until recently, however, the sound of famous singers pleading poverty has fallen on deaf ears in Congress. Broadcasters, who paid out $550 million in royalty fees to writers and publishers in 2008, have successfully argued that singers get free radio airtime and promotion, resulting in millions of dollars in concert, merchandise, and record sales. Performers also get paid through contracts with labels.
But the music industry hopes that changing business models driven by new technology and an aggressive lobbying effort could force the broadcasters to change their tune. As consumers have shifted their music listening habits to the Internet, iPods, and satellite radio, and large corporations have bought up stations, the free airplay argument may no longer hold. More key lawmakers are expressing support for the music industry's position, and a nasty lobbying fight has erupted between the industry and broadcasters. The colorful comments of two prominent industry leaders demonstrate the passions at play. "This isn't a question of if they will lose, it's when they will lose," Mitch Bainwol, the Recording Industry Association of America's chairman and CEO, predicted while discussing the fight with National Journal. David Rehr, the National Association of Broadcasters' president and CEO, calls the fight "a long, drawn-out, brutal conflict between the foreign record labels and America's radio broadcasters." (The foreign-record comment is a reference to three of the country's four largest recording industry labels, which are owned by non-U.S. companies.) Read the full story and watch companion video here.
Intellectual property rights enthusiasts lauded a Swedish jury's decision Friday to hold the two founders and two operators of the infamous Pirate Bay Web site guilty of criminal copyright infringement. The court levied jail sentences and civil damage awards worth about $3.6 million against the defendants whose BitTorrent site attracted an estimated 22 million users worldwide. The Progress and Freedom Foundation's Tom Sydnor said the outcome delivered a simple message about the activities of the Pirate Bay: "Good riddance to bad rubbish." He commended Sweden for upholding the rule of law and urged the government to act swiftly to end the site's illegal activities.
Syndor also said the ruling was "an affirmation of the rights of the hard-working, law-abiding creators" whose efforts to stem the global recession were hampered by "socially destructive freeloading" by sites and distributors of piracy-adapted file-sharing programs. Business Software Alliance President Robert Holleyman also commented on the ruling, saying it "serves as a clear warning to other Web site operators who are knowingly offering illegal content, or enabling the illegal distribution of content, that their operations are immoral and punishable by law." The trade group executive called the case "a victory for copyright holders, who deserve to be rewarded for their creativity and hard work." Internet-based software piracy is a huge problem with serious consequences for consumers, the economy, and society, Holleyman said.
From CongressDaily's Tuesday PM Edition...
The Obama administration's selection of a Patent and Trademark Office director cannot come soon enough, according to officials inside the agency. They cite serious cash-flow problems, internal cutbacks and a downturn in the number of applications filed and patents granted amid continued U.S. economic gloom. "We need a new director just as soon as we can get one," Patent Office Professional Association President Robert Budens said Monday. While the administration and Commerce Department, which houses PTO, have been tight-lipped about the appointment, sources say Commerce Secretary Gary Locke is involved and an announcement could come in the next week or two. Oft-mentioned prospects for the job include Q. Todd Dickinson, who ran the office under former President Bill Clinton, Silicon Valley attorney Jim Pooley and IBM Vice President David Kappos. During his March confirmation hearing, Locke vowed not to let urgent issues like the 2010 census crowd out topics like improving the patent office's productivity. The agency faces a backlog of more than 750,000 applications. Read the full story here.
House Oversight and Government Reform ranking member Darrell Issa, a cosponsor of legislation that would end a long-standing royalty exemption granted to AM and FM radio, believes the National Association of Broadcasters is engaging in "overt intimidation" and has forced talk radio hosts around the country to attack the bill and urge listeners to call specific members of Congress. Issa said in an interview last week that he has been barraged by angry phone calls from listeners and said other bill supporters have had a similar experience. The NAB opposes the proposal that many believe would bring over-the-air radio in line with Internet, cable and satellite music services that pay performers for use of their work. Broadcasters argue the promotional value of airplay and album and concert sales make up for the disparity.
"This is really 527 activity and it is a violation of FEC rules," Issa said of the NAB's alleged efforts. "I suspect if they continue, one or more members will complain the NAB is using airwaves to affect the outcome of an election." NAB spokesman Dennis Wharton offered a different take on what is going on. "Broadcasters have a responsibility to 235 million weekly listeners of free, local radio to encourage a national dialogue on the devastating impact of a performance tax," he said. The legislation in question would endanger local radio's already unsteady financial position by diverting hundreds of millions of dollars into coffers of record labels, he argued. "Citizens have a right to know that a performance tax imperils the future of free, local radio."
The Business Software Alliance on Monday launched the "Faces of Internet Piracy" campaign that shows the real-life impact of intellectual property theft - from hundreds of thousands of dollars in fines to jail time. BSA represents Cisco Systems, Dell Computer, Intel Corp., IBM, Microsoft and a number of other high-tech firms. BSA toured the country interviewing software pirates from all walks of life, including an Austin, Texas college track star; a Richmond Hills, Georgia grandmother; a Lakeland, Florida entrepreneur; a Wichita Falls, Texas software programmer; and a New Milford, Connecticut college student. Their stories are told on a new BSA Web page.
"These stories are a wake-up call for distributors and users of illegal software," BSA President Robert Holleyman said in a statement. "Don't take our word for it; just listen to these software pirates explain how they made money by duping thousands of people into purchasing or downloading illegal software from the Internet. Hear how their actions ended up costing them serious fines and prison sentences." Watch the video above for more details about the project. The Faces of Internet Piracy Web page also offers shopping tips for software consumers and lessons on how to safeguard against becoming a victim of piracy.
The Motion Picture Association of America has announced the line-up of speakers for its April 21 Business of Show Business symposium in Washington, which will include a luncheon keynote by professional wrestler-turned-actor Dwayne Johnson. Johnson, who was known to World Wrestling Entertainment fans as "The Rock," got his big screen break in Universal Pictures' "The Mummy Returns" and appeared in box office hits "The Scorpion King" and "The Game Plan." In recent years, Johnson has established himself as a top leading man in Hollywood and was most recently seen in Walt Disney Pictures' "Race to Witch Mountain," which opened at #1 at the box office on March 13.
In addition to Johnson, speakers include Rep. Steve Scalise, R-La.; heads of film offices for Chicago, Philadelphia, and Georgia; "Angels and Demons" Executive Producer Todd Hallowell; Paramount Executive Vice President Chris Carey; Pixar Vice President Rob Cook; costume designer Deborah Nadoolman Landis; and Blue Sky Studios Chief Technology Officer Carl Ludwig. "So much goes in to making a film - from local crews and catering to handmade period costumes and innovative special effects - this event is a forum to showcase America's off-screen stars and give everyone a better sense of the business behind the movies," MPAA Chairman Dan Glickman said in a press release.
The National Association of Broadcasters broadened its sphere of Internet influence Tuesday by launching NoPerformanceTax.org, an online hub for the organization's campaign to fight legislation that would end a longstanding royalty exemption for AM and FM stations. The Web site gives radio stations the ability to download, air, and share radio spots opposing what NAB has deemed a "performance tax" as well as online banner ads for use on station Web sites and sample letters to members of Congress. The site also provides users with background information on the issue, video clips from congressional hearings and Capitol Hill events, and NAB news releases.
The front page of NoPerformanceTax.org boasts an interactive graphic made up of hundreds of gold and platinum albums on display in local radio stations across America. The albums are customarily presented by record labels to local radio stations as a sign of appreciation for promoting their music and propelling album sales. "Olympians aren't the only ones who bring home the gold," the Web site says. "Local radio stations provide billions of dollars in promotional value to artists and record labels. In appreciation, the record labels bestow upon radio stations 'gold' and 'platinum' albums to show their gratitude."
Marty Machowsky, a spokesman for the MusicFirst Coalition, which supports the fee, called NAB's Web attempt "so 2007." "NAB's witness at the Senate Judiciary Committee hearing said a fair performance right on radio is not a tax. A new Web site can't save an old, discredited argument," he said. Companion bills were introduced by Senate Judiciary Chairman Patrick Leahy and House Judiciary Chairman John Conyers earlier this year. A resolution in opposition was introduced by Texas Reps. Gene Green, a Democrat, and Republican Mike Conaway a short time later. Sens. Blanche Lincoln, D-Ark., and John Barrasso, R-Wyo., introduced a similar resolution last month.
Surf on over to CongressDaily's TechCentral for a new "Issue of the Week." Here's a taste:
GENEVA, Switzerland -- After several years of stalemate, global discussions on patent policy have begun stirring again, this time with a public-interest twist. And it may just be coincidence that this comes at a time when domestic patent reform legislation is beginning to move in Congress. Member governments of the United Nations World Intellectual Property Organization met here last week and began setting the groundwork for a new global patent policy agenda that could contribute to broad policy concerns such as climate change and public health.
The filing and use of patents on innovation has led to enormous wealth for companies and economies in parts of the world like the United States, and patent filing is rapidly rising in others, like China. Proponents call intellectual property rights the main source of wealth for firms, and argue that they hold their value in economic uncertainty. But attitudes about patents and the use of patent systems differ around the world. Patent holders have been trying for years unsuccessfully to improve harmonization among those systems to ease barriers to protection and enforcement of their rights.
But many developing countries have resisted erecting new international rules on IP, in part because they are still struggling with implementation of the 1994 World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which raised commitments on IP rights protection. Read the full story here.
A coalition of consumer advocates, library associations, and trade groups representing the technology, consumer electronics, and telecommunications industries wrote to President Obama Thursday urging him to make sure his future appointments to intellectual property positions "reflect the diversity of stakeholders affected by IP policy." The letter points out that several appointees to positions that oversee the formulation and implementation of IP policy have previously represented "the concentrated copyright industries." They cite as examples two senior officials in the Justice Department -- Thomas Perrelli and Donald Verrilli as examples.
Perrelli was tapped to become associate attorney general and Verrilli for deputy associate attorney general. Both men represented the recording industry in litigation for many years. "The fact that these individuals were litigators rather than registered lobbyists does not diminish the possibility that they may be inclined favorably towards the positions of the industries they long represented," the letter said. Key vacant positions include IP policy posts at the Patent and Trademark Office, U.S. Trade Representative, and State Department. "Individuals who support overly broad IP protection might favor established distribution models at the expense of technological innovators, creative artists, writers, musicians, filmmakers, and an increasingly participatory public," the signatories said.
Overzealous expansion and enforcement of copyright can quash innovative IT, development and marketing of new and useful devices, and the creation of new works, as well as prohibit the public from accessing and using its cultural heritage, the argued. The letter was signed by the American Library Association; Center for Democracy and Technology; Computer and Communications Industry Association; Consumer Electronics Association; Consumers Union; Electronic Frontier Foundation; Public Knowledge and others. Read the document here.
Generic pharmaceutical industry officials are angry over an amendment that Sen. Orrin Hatch, R-Utah, might introduce Thursday as the Senate Judiciary Committee continues its mark up of sweeping patent legislation. The proposal would essentially let the Patent and Trademark Office examine information that was not considered during an earlier review. Under the plan, if a patent is issued, the information in question may not be used to hold the patent unenforceable. The amendment also clarifies that requesting the reissue (or the decision not to) cannot alone be the basis of an "inequitable conduct" challenge. The proposal does not touch the underlying doctrine, which generic drug makers believe is vital to ensure timely market entry of medicines, according to CongressDaily's AM Edition.
But generics manufacturers argue the Hatch amendment would essentially incentivize intentional deceptive before the PTO. It's a back door "but for" test that would do away with the inequitable conduct defense, they argue, calling the proposal an 11th hour effort by brand pharmaceutical companies. The plan allows patentees to effectively "sanitize" their patents from all prior cheating or lying at the PTO by submitting the concealed or misrepresented information for consideration, even long after the patent issued, generics stakeholders said. If adopted, the offering could cause great delay in litigation, will not reduce costs, and burdens the PTO with a new procedure, they argue.
The Obama administration's choice for Patent and Trademark Office director is expected to be announced in April now that the Senate has confirmed Gary Locke, the president's pick for Commerce secretary. If the right person is named to head the PTO, the appointment "may tip the scales to move patent reform legislation from a pending bill to enacted legislation, perhaps as early as this year," Foley & Lardner attorney Hal Wegner said in a Monday e-mail. So who is in the running for the top job at PTO? Sources say the following names are prominently in play:
• Q. Todd Dickinson: Dickinson ran the PTO under former President Bill Clinton and currently heads the American Intellectual Property Law Association. Before joining AIPLA in 2008, he was chief IP counsel for General Electric.
• Jim Pooley: Pooley is a partner in the litigation department of the Palo Alto office of Morrison & Forrester and has practiced in Silicon Valley since 1973. He is immediate past president of the AIPLA and president of the National Inventors Hall of Fame.
• David Kappos: Kappos is vice president and assistant general counsel for IP at IBM. He joined IBM in 1983 as a development engineer. He serves on the board of directors for the Intellectual Property Owners Association and is active in AIPLA.
Shortly after Election Day, CongressDaily pondered Dickinson, Pooley and some other possibilities. They included Eli Lilly general counsel Robert Armitage; 3M IP counsel Gary Griswold; patent attorney Ray Millien; and law professors Mark Lemley of Stanford and Arti Rai of Duke, a classmate of Obama's at Harvard Law School.
Sens. Blanche Lincoln, D-Ark., and John Barrasso, R-Wyo., have joined more than 150 members of the House in supporting a resolution opposing the introduction of "any new performance fee, tax, royalty, or other charge" on local radio stations. The nonbinding Senate measure introduced Monday mirrors one sponsored earlier this year by Texas Reps. Gene Green, a Democrat, and Republican Mike Conaway and comes as roughly 500 local members of the National Association of Broadcasters arrive in Washington for their annual state leadership conference.
Legislation offered by House Judiciary Chairman John Conyers and Oversight and Government Reform ranking member Darrell Issa and Senate Judiciary Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah, would bring over-the-air radio in line with Internet, cable and satellite music services that pay artists for use of their work. Broadcasters have long argued that the promotional value of airplay and the resulting album and concert ticket sales make up for the disparity. NAB spokesman Dennis Wharton said the "performance tax" would threaten thousands of jobs, reduce music diversity, and hamstring a new artist's ability to reach radio's 234 million weekly listeners.
Supporters of the House and Senate radio royalty bills, however, sent a press release pointing out that the legislation now enjoys the support of seven committee chairmen in the House. In addition to Conyers, the Performance Rights Act is cosponsored by Foreign Relations Chairman Howard Berman; Energy and Commerce Chairman Henry Waxman; Rules Chairwoman Louise Slaughter; Homeland Security Chairman Bennie Thompson; Oversight and Government Reform Chairman Edolphus Towns; and Agriculture Chairman Collin Peterson.
Internet industry billionaire and Dallas Mavericks owner Mark Cuban posed a few interesting questions on his blog last week. Is a "tweet" -- a post via micro-blogging platform Twitter -- copyrightable? Is a tweet copyrighted by default when it's published? Can there possibly be a fair use exception for something that is only 140 characters or less? Is twittering the process of publishing or is it a private communication to those that follow you? He wonders if the same would apply to social networking site Facebook asking whether users really "own" their status updates.
"I got to thinking about this when I tweeted about an NBA game. I tweeted to the people who follow me. While I never asked that they not distribute it to other tweeters, I did not give anyone permission to republish my tweets in a commercial newspaper, magazine or Web site," he wrote. The NBA fined Cuban $25,000 for grumbling about referees on Twitter. His tongue-in-cheek tweet response: "Can't say no one makes money from Twitter now. The NBA does." Read Cuban's blog here and follow him on Twitter here.
The most controversial components of a bill that would overhaul the U.S. patent system, which is teed up for Senate Judiciary Committee consideration Thursday morning, will likely be pushed back until next week. Judiciary Chairman Patrick Leahy's mark up is expected to be a short one (for now) with the panel potentially considering a manager's amendment that will be largely technical in nature, CongressDaily's AM Edition reported. Eight of his committee's 19 members are also likely to be embroiled in the Senate Budget Committee's simultaneous markup of the fiscal year 2010 budget resolution and will have to choose between proceedings.
The biggest hurdle for Leahy continues to be a provision that would change how courts award damages in patent infringement lawsuits -- but sources say a compromise is in the works. A modified version of a "gatekeeper" proposal pitched by Judiciary ranking member Arlen Specter and Sen. Dianne Feinstein, D-Calif., last Congress may be the winning approach, Leahy's cosponsor, Sen. Orrin Hatch, R-Utah, told CongressDaily. That concept would provide courts with clearer requirements on handling evidence of infringement and determining compensation. Talks are underway for a deal on what a Republican aide called "gatekeeper plus." The staffer said the compromise should appease high-tech firms that have insisted on bold changes to the damages regime.
Read CongressDaily's full story here (subscription required).
From CongressDaily's AM Edition...
House and Senate Republicans are preparing to christen their chambers' high-tech membership organizations after a prolonged lull. Once launched, they will have a host of hot topics on their plates including President Barack Obama's tax and trade policy proposals and the union-backed Employee Free Choice Act. Even without a formal agenda in place, House Republican High Tech Working Group Chairman Bob Goodlatte of Virginia joined Judiciary ranking member Lamar Smith and Education and Labor ranking member Howard (Buck) McKeon this month to denounce the EFCA. They contend that card-check legislation would harm workers' privacy rights.
Goodlatte has assembled about 45 members for his working group, which had a prominent role in the Republican-controlled 109th Congress but, like the Senate High Tech Task Force, was largely muffled when Democrats came to power. The Senate Republican High Tech Task Force is also gearing up. It was created by former Senate Majority Leader Trent Lott, R-Miss., and before former Sen. Gordon Smith of Oregon's tenure last session, was led by Sens. John Ensign of Nevada, Robert Bennett of Utah, and former Sen. George Allen of Virginia. The Senate Democratic High Tech Task Force, which was co-chaired last Congress by Sens. John Kerry of Massachusetts and Mark Pryor of Arkansas, has also been slow to start. Read the full story here (subscription required).
More than 100 Golden State companies who have serious concerns about legislation intended to overhaul the U.S. patent system are putting pressure on Sen. Dianne Feinstein, D-Calif., days before the Senate Judiciary Committee is slated to consider the bill. An array of companies including Amgen, Corning, Monsanto and Qualcomm signed the letter sent late last week by the California Healthcare Institute, which represents medical device, biotechnology, diagnostics and pharmaceutical firms. The measure, co-sponsored by Judiciary Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah, contains controversial language that would change how courts calculate damages in patent lawsuits. The signatories argue that the legislation "fails to account for a number of significant court decisions that have both transformed the patent aw landscape and addressed the supposed failings of the current system."
The companies say they support "balanced and reasonable efforts" to improve patent quality up front by modernizing operations and providing new resources to the Patent and Trademark Office. Major high-tech and media companies, however, believe more aggressive, litigation related changes are needed to keep the United States competitive. The bill is scheduled to be marked up Thursday and Feinstein serves on the committee. During a recent hearing, witnesses expressed interest in revisiting a "gatekeeper" damages provision, which was explored in the 110th Congress by Feinstein and Judiciary ranking member Arlen Specter. The proposal, which would provide courts with clearer requirements on handling evidence of infringement and determining damages, was not included in the current version or in the bill that passed Leahy's panel in July 2007.
Officials inside the Office of the U.S. Trade Representative have promised to thoroughly review their transparency policies on the heels of complaints by several civil society groups who argued that deliberations over the proposed Anti-Counterfeiting Trade Act have been too secretive, Knowledge Ecology International Director James Love said Friday. The review is expected to be completed within a few months and will include a meeting in the coming weeks to discuss initial specific proposals for openness, he wrote on his blog. Citizens and non-governmental organizations are encouraged to think about the specific areas where openness and transparency can be enhanced and how, Love said.
Among the proposals that will be evaluated are the following at the request of KEI:
1. Disclosure of all negotiating texts and policy papers
2. Disclosure of all meeting agenda (as soon as they are available), and participant lists, extending to plurilateral, regional and bilateral negotiations policies that are common at multilateral institutions.
3. Accreditation of civil society NGOs to attend meetings, including in plurilateral, regional and bilateral negotiations, as is common at multilateral institutions.
4. Public consultations and comment periods, including those that accept comments to web based forums.
In addition, the USTR is welcoming groups to make other proposals, he said. Read more about last week's meeting on KEI's blog here and a recent CongressDaily story on the topic here (subscription required).
Sen. Jon Kyl, R-Ariz., unceremoniously reintroduced a bill last week that would make changes to the U.S. patent system -- an alternative to legislation sponsored in the 110th Congress and again this session by Senate Judiciary Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah. Under Kyl's plan, which has been tweaked slightly since it was last introduced, litigants in patent infringement lawsuits would be encouraged to use precise economic analyses to determine damages rather than less exact calculations. Supporters of Leahy's bill, which is scheduled for a Thursday mark-up, want a solution that includes specific rules for apportionment of damages in patent lawsuits.
In drafting Kyl's bill last year, staff consulted extensively with critics of Leahy's proposal, including the pharmaceutical and life-sciences industries and members of the Innovation Alliance, a group of small tech firms and companies whose business models depend on patent licenses. A number of others like the Coalition for 21st Century Patent Reform, the Biotechnology Industry Association, Intellectual Property Owners Association, and American Intellectual Property Law Association also weighed in. At the time, Pharmaceutical Research and Manufacturers of America Senior Vice President Ken Johnson told CongressDaily that Kyl's proposal "pushed the ball forward and helped set the table for responsible reform."
Noticeably absent from the dialogue with Kyl's staff was the Coalition for Patent Fairness, which represents Cisco Systems, Google, Microsoft, Time Warner, and others. That group, which backs Leahy's approach, said in a statement last fall that Kyl's bill "will not fix the nation's patent system, which is broken and draining critical resources from healthy sectors of our economy." At the time, Hatch issued a statement calling Kyl's measure "a worthy attempt" but not a "silver bullet." Read CongressDaily's earlier coverage of the Kyl bill here, here, and here (subscription required).
Longtime intellectual property rights crusader Rep. Howard Berman, D-Calif., might have moved on to chair the House Foreign Affairs Committee in the 111th Congress but he has not abandoned his passion for the hot-button policy topic. Berman, whose congressional district includes parts of Hollywood, is planning an April 6 field hearing in Van Nuys on the international impact of counterfeiting and piracy. Berman chaired the House Judiciary Subcommittee on Courts, the Internet, and Intellectual Property last Congress and after being tapped for the Foreign Affairs top spot, Judiciary Chairman John Conyers decided to eliminate the panel and handle IP at the full committee level.
The forthcoming hearing titled "Sinking the Copyright Pirates: Global Protection of Intellectual Property" will feature representatives from various sectors of the entertainment industry who will discuss the devastating economic impact of illegal reproduction of copyrighted material overseas, a Monday e-mail from Berman's office said. Members of the House Foreign Affairs Committee will take part but a witness list has not yet been released. According to the International Intellectual Property Alliance, U.S. creative industries account for $110 billion annually in revenue from foreign trade but they are losing billions from IP theft. IIPA recently told the Office of the U.S. Trade Representative in a filing that in 48 countries, the software and recording sectors alone lost more than $18.4 billion to bootleggers.
As President Barack Obama's first 100 days whiz by, Senate Judiciary Chairman Patrick Leahy, ranking member Arlen Specter, and Sens. Evan Bayh, D-Ind., and George Voinovich, R-Ohio, are pressuring the White House to make intellectual property protection a priority. The foursome who was the driving force behind last year's PRO IP Act, which former President George W. Bush signed in October, wrote to Obama last week urging him to nominate an IP enforcement coordinator. The position within the Executive Office of the President was created in their legislation and "can improve the effectiveness and efficiency of the administration's efforts to protect American intellectual property," they wrote in a letter obtained by Tech Daily Dose.
Such an official can make a major impact in the fight against counterfeiting and piracy "but only if placed in an appropriate position of authority" inside the White House with adequate funding, the senators said. "Intellectual property rights promote innovation and creativity, long recognized as major drivers of the United States economy. Protecting intellectual property is therefore both a law enforcement objective and an important component of our economy recovery efforts," they wrote. CongressDaily reported shortly after Election Day that Victoria Espinel, a Democrat who served as the first assistant trade representative for IP, was a likely contender. Entertainment industry officials' names were also floated including Shira Perlmutter, a former associate general counsel for Time Warner.
Fans and foes of legislation that would end a longstanding copyright royalty granted to AM and FM radio made their cases on Capitol Hill on Thursday. The National Association of Broadcasters, which opposes the measure, hosted a panel discussion featuring radio personality Tom Joyner and minority broadcasting executives including Radio One founder Cathy Hughes; ICBC Broadcast Holdings President Charles Warfield; Glory Communications President Alex Snipe and others. They argued the legislation will destroy diversity in the urban radio community and put many radio jobs at risk.
Meanwhile, representatives from the MusicFirst Coalition, which supports the bill, visited members with Duke Fakir of the Four Tops. Fakir joined Motown legends Martha Reeves of Martha and the Vandellas and Mary Wilson of the Supremes in sending a same-day letter to lawmakers asking them to support the bill. "This bill will have a real and positive economic impact in the lives of working musicians and recording artists and help ensure the continued vitality of American music and culture," the letter said.
As expected, the Senate Judiciary Committee on Thursday delayed consideration of controversial patent legislation introduced earlier this month by Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah. The bill has been criticized by a number of industry stakeholders -- mainly because of its controversial provision to change how damage are awarded in patent infringement lawsuits -- but was put on the agenda for the panel's mark up anyway. Under committee rules, any member can request a hold-over on legislation that appears on the agenda for the first time. In this case it was ranking member Arlen Specter who asked that the bill be held (see CongressDaily's PM Edition for more).
Leahy indicated that productive meetings had been held on the legislation with a number of offices. "The hearing last week demonstrated that there is wide consensus among participants in the patent system, academics, and senators on this committee that patent reform is necessary," he said. "It should also be apparent, at least in my view, that the time for posturing has ended, and the time for reaching agreement has arrived." At the patent hearing, Specter asked witnesses for language to describe what the test for damages should be and many of them were close to using the same words, Leahy said. "We are looking for a way to get this right, to legislate responsibly." The committee is expected to revisit the bill in executive session next Thursday.
Sen. Orrin Hatch, R-Utah, on Wednesday laid out his argument for why legislation he cosponsored with Senate Judiciary Chairman Patrick Leahy should include an "inequitable conduct" provision that would rule patents invalid if owners are not forthcoming to the Patent and Trademark Office. The language was part of a bill that passed Leahy's panel last Congress but was axed from the version they reintroduced this year. "Inequitable conduct reform is core to patent reform, as it dictates how patents are prosecuted years before litigation," Hatch told a symposium on the U.S. Court of Appeals for the Federal Circuit.
The inequitable conduct defense is frequently pled, rarely proven, and always drives up the cost of litigation, he said. If an inequitable conduct claim wins, a valid patent will be held entirely void, and the infringer walks away without any liability, he added. There is "virtually no downside for the infringer to raise this type of attack." Yet Hatch acknowledged the generic drug industry deems the inequitable conduct defense sacrosanct and any attempt to change it will be met with opposition. Once compromise is reached on that issue and on how to calculate damages in a patent lawsuit, "the rest of the bill will fall into place," he said.
With respect to damages, Hatch said specific language like "apportionment, contribution over prior art, or essential features" has been dismissed by many but at last week's Judiciary hearing, Hatch said he heard agreement on a gatekeeper approach where a judge instructs juries on what factors to consider in determining damages and agreement that damages should be based on the economic value of the invention to the infringed product or process. The bill has been listed for a Thursday mark up but will likely be held over. At the event, Hatch also told a joke with the punch line: "But you're a patent attorney, you don't know enough law to hurt anybody." Follow the jump to read it...
When President Barack Obama approved a $410 billion omnibus spending bill for fiscal year 2009 last week, he made the first two appropriations related to legislation passed by the 110th Congress that is aimed at fighting counterfeiting and piracy. The Prioritizing Resources and Organization for Intellectual Property Act, which former President George W. Bush signed in October, increased both civil and criminal penalties for trademark and copyright infringement and created the yet-to-be-named post of an IP enforcement coordinator at the White House. Specifically, the omnibus included $9.4 million for hiring new FBI agents dedicated to work solely on IP issues, according to the U.S. Chamber of Commerce, which pressed lawmakers to pass the IP measure.
The funding will allow the addition of two agents in each of the field offices containing Computer Hacking and Intellectual Property units, which the Justice Department has determined most merit assistance in IP rights investigations, with no less than 26 agents assigned for this purpose. The money also provides for the creation of an additional and distinct operational unit at FBI headquarters with at least five full-time, permanent agents dedicated to working with DOJ's Computer Crime and Intellectual Property Section on complex, multi-district and international criminal IP cases. Additionally, the omnibus allocates $18 million for state and local grants for "economic, high-tech and cybercrime prevention." While not IP specific, grant requests for IP enforcement would be eligible.
Senate Finance Chairman Max Baucus said at Monday's confirmation hearing for U.S. Trade Representative-designate Ron Kirk that he intends to introduce "comprehensive customs reauthorization legislation," which some see as a potential vehicle for increasing intellectual property protections for goods imported and exported by the United States. Stakeholders like the U.S. Chamber of Commerce believe such a package could include language to better address trafficking in illicit goods.
On a related note, Baucus and Sen. Orrin Hatch, R-Utah, introduced legislation last Congress that would make improvements to the USTR's "Special 301" process to help deal with other countries that fail to live up to their international IP obligations. Under the existing USTR structure, the list puts nations with weak IP regimes on two tiers of watch lists, but the bill would require the creation of "action plans" for the worst offenders. If countries do not comply, the White House could ban federal procurement from and stop U.S. financing to those nations.
The Chamber's blog offered up several IP-related issues for Finance Committee members to address at Kirk's hearing. Topics included ensuring that strong and enforceable IP protections, such as those in the Korea Free Trade Agreement, are included in future FTAs; negotiations on the Anti-Counterfeiting Trade Agreement; strengthening international IP laws and norms; and fighting Internet piracy while protecting copyrighted materials.
On the eve of a House Judiciary Committee hearing to examine legislation that would terminate a longstanding royalty exemption afforded to AM and FM radio, the National Association of Broadcasters slammed the music industry-led effort as being "founded on an incomplete and therefore misleading comparison of U.S. and international copyright law." Proponents of the bill have argued that in every other democratic free market country, radio stations compensate musicians when they play their music. The countries, however, do not compensate artists and musicians within the United States because the United States does not provide a performance right for their artists.
"The record labels have devised a lobbying strategy that relies on cherry-picking international examples that paint a distorted picture of copyright law," NAB spokesman Dennis Wharton said in a press release. "The U.S. protects sound recordings for 45 years longer than Canada and many countries in Europe and elsewhere; if it's 'international parity' that RIAA is looking for, they ought to examine the entire landscape," he said. NAB's analysis also points out that other countries' broadcasting systems are or were government-subsidized while the U.S. business was built by private commercial entrepreneurs.
But the MusicFirst coalition, which supports the legislation, bit back by claiming the analysis is suspect and stale. According to the coalition, the NAB's Canadian counterpart submitted the same study to support its claim that radio play promotes album sales in a proceeding before the Copyright Board of Canada. In November 2008, the board threw it out because the underlying data was destroyed. The same analysis was released by NAB last June and again Monday, officials said. Wharton scoffed at the notion that NAB destroyed data and added: "MusicFirst should get its facts straight before making unfounded allegations." Read more in CongressDaily's AM Edition (subscription required).
International organized crime isn't just about drugs, money laundering, extortion and human smuggling anymore -- the illicit activity increasingly involves piracy of feature films, with syndicates active along the entire supply chain from manufacturers to street sales of pirated movies, according to a new RAND Corporation report funded by major movie studios. The profits from film piracy also have been used on occasion to support the activities of terrorist groups, researchers at RAND's Center for Global Risk and Security found, according to a Tuesday press release.
RAND researchers detail 14 case studies of film piracy, providing compelling evidence of a broad, geographically dispersed and continuing connection between piracy and organized crime. As well as documenting cases in North America and Europe, the report outlines the involvement of organized crime with film piracy in South America, Russia and many parts of Asia. The research was based upon 2,000 pages of documents and interviews with more than 120 law enforcement and intelligence agents from 20 countries, officials said.
Film piracy can be even more profitable than drug trafficking or other enterprises commonly linked to organized crime, RAND said. In one example cited in the report, a pirated DVD made in Malaysia for 70 cents was marked up more than 1,000 percent and sold on the street in London for about $9. The profit margin was more than three times higher than the markup for Iranian heroin and higher than the profit for Columbian cocaine, according to the report. Worldwide, criminal penalties for counterfeiting are relatively light and prosecution is sparse compared to selling drugs, the paper stated.
House and Senate sponsors of legislation that would overhaul the U.S. patent system were optimistic Tuesday that after several rounds of serious debate and considerable controversy, the 111th Congress would send a comprehensive patent bill to the president's desk. "This is the Congress, this is the year," Senate Judiciary Chairman Patrick Leahy said, standing shoulder-to-shoulder with cosponsor Sen. Orrin Hatch, R-Utah, and their House partners in the endeavor, Judiciary Chairman John Conyers and ranking member Lamar Smith. Read CongressDaily's AM Edition for details.
More than 100 artists, musicians, songwriters, and independent label representatives will be roaming the halls of Congress on Tuesday urging members to support legislation that would end a long-standing royalty exemption granted to AM and FM radio. The fly-in, organized by the MusicFirst Coalition, will include notable names like Suzanne Vega, The Donnas, Abdul (Duke) Fakir of the Four Tops as well as lesser known but influential musicians: Phil Soussan (the bass player for Ozzy Osborne, Billy Idol, Edgar Winter and others); Dan Workman of Sugar Hill Records; "Save the Best for Last" songwriter Phil Galdston; and Craig Krampf, the drummer on Kim Carnes' hit "Bette Davis Eyes."
The visit to House and Senate members comes on the eve of a House Judiciary Committee hearing on the bill, which is sponsored by Chairman John Conyers and Oversight and Government Reform ranking member Darrell Issa. Senate Judiciary Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah, sponsored companion legislation in their chamber. Texas Reps. Gene Green a Democrat, and Republican Mike Conaway, sponsored a resolution opposing the legislation that is quickly picking up support. Meanwhile, Recording Academy President Neil Portnow sat down with yours truly last week to explain the debate on C-SPAN's "The Communicators." That video is available here.
Updated at 1:10 p.m. on March 3.
Senate and House intellectual property leaders will hold a press conference Tuesday afternoon on Capitol Hill to discuss congressional action to overhaul the nation's patent system in the 111th Congress. Senate Judiciary Chairman Patrick Leahy, Sen. Orrin Hatch, R-Utah, House Judiciary Chairman John Conyers and ranking member Lamar Smith are expected to introduce bipartisan bicameral patent legislation the same day. The House passed a patent bill last Congress 220 to 175 and the Senate Judiciary Committee reported a similar measure. The bill stalled after Leahy and ranking member Arlen Specter collided over differences on how damages should be awarded in patent lawsuits.
Recent CongressDaily coverage on this issue (subscription required):
Patent Bills Coming Soon From Judiciary Leaders
Leahy: Senate Patent Bill Coming Soon
Senators Close To Reintroducing Patent Overhaul Measure
Eyeing Patent Overhaul, Big Manufacturers Form Coalition
CAP Urges Patent Overhaul Be Priority For Congress, Obama
Look for more in CongressDaily's Tuesday AM Edition.
The House Judiciary Committee Wednesday will hear perspectives on legislation by Judiciary Chairman John Conyers that would end a long-standing copyright royalty exemption granted to AM and FM radio. The bill, backed by the Recording Industry Association of America and other music business stakeholders, has been criticized by the National Association of Broadcasters. The powerful trade group believes the airplay its members provide is an ample reward for performers who sell albums and concert tickets. A Tuesday House Judiciary Commercial and Administrative Law Subcommittee hearing on why bankruptcy protections failed to halt the closure of Circuit City has been cancelled.
Meanwhile, the FCC continues to prepare the nation for the transition to digital television signals -- set to culminate June 12 -- with a Thursday public meeting on the topic. The session is the second to be held under acting FCC Chairman Michael Copps, whose first meeting also focused on the switchover. Also on Thursday, the Information Technology and Innovation Foundation will release a new report on the need for next-generation broadband networks in the United States. The report will document how the transformative functionalities that next-generation broadband enables will unlock a wave of innovative new Web-applications, delivering benefits to consumers, society, businesses, and the economy.
As lawmakers and lobbyist prepare to do battle over legislation that would make sweeping changes to the U.S. patent system, one group backed by small and mid-sized companies hoping to influence the process has hired an executive director to coordinate its efforts in the 111th Congress. The Innovation Alliance announced Friday that it had brought on Brian Pomper, former international trade counsel for Senate Finance Committee Chairman Max Baucus. After leaving Capitol Hill, he co-founded consulting firm where he worked with clients on international trade and intellectual property.
The alliance's members, which include well known names like Dolby Laboratories and Qualcomm as well as lesser known firms, "understand that American ideas and innovation have been a critical part of our economic success and will be even more important in our economic recovery," Pomper said. He vowed to fight for a strong patent system that protects the rights of American inventors and drives our economy toward recovery. The Innovation Alliance, however, was a loud critic of patent bills introduced last Congress and complained that the proposals would have done more harm than good.
Legislation that would make sweeping changes to the U.S. patent system could be unveiled as soon as Tuesday, industry sources told CongressDaily. Congressional aides would not confirm the timing, but the bills are expected to be introduced jointly by House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy. The measures would modify how courts handle patent disputes and would help streamline operations at the Patent and Trademark Office.
Ahead of the bill drop, groups formed by industry stakeholders to try to influence the patent debate said they have high hopes that President Barack Obama's new pick for Commerce secretary -- former Washington Gov. Gary Locke -- will be involved in the issue. On Thursday, the Innovation Alliance, which represents high-tech firms that do not want sweeping changes to the patent regime, lauded Locke's record of "working to help create an environment in the state of Washington that has nurtured the development of many small innovative companies."
The Coalition for Patent Fairness, which has championed Leahy's legislation, said Wednesday that Locke "understands the need to encourage innovation in order to create jobs and grow the U.S. economy" and his work as governor "shows that he understands the need for a strong patent system." The Coalition for 21st Century Patent Reform, which has called for more limited modifications to the system said Locke's leadership "will enhance the ability of the PTO to stimulate the innovation and manufacturing that will be instrumental to our nation¹s economic recovery."
The role of intellectual property in the economy will be even stronger post-recession than it was prior to when the economy began faltering, according to James Malackowski, president of Ocean Tomo, a bank that specializes in providing IP related financial products and services. "The recession gives people the opportunity to focus on what's important [and] will help to prove that IP adds significant value and then when the recession is over, IP will remain on the front burner," Malackowski said.
Some have said the 6-year-old firm is ahead of its time -- and that can be both a positive and a negative. In the last six months, the 80-plus employee company has given about 20 staffers their walking papers including 11 last week. Malackowski said those decisions reflect the bank's attempt to adapt to a changing market. Going forward, their will be some great IP deals on the market and more emphasis on IP quality, he said. He added that because the economy is bad, IP holders and countries "need every dime of value that there IP provides them" and there will be more anti-piracy efforts.
"The U.S. continues to be a leader in recognizing IP rights. With this recognition comes additional value. IP value is stronger here than elsewhere but other countries are quickly catching up by having a national policy focus on IP as an asset - such as Japan, Taiwan, to some extent China," who understand that they have to catch up, Malackowski said. "Typically IP is a counter-cyclical asset and in a modest recession companies turn to their IP as an underutilized value whether it be for sale or enforcement. This cycle is different." "We didn't slide into a recession we collapsed into one," he added. -- Winter Casey
In the recently ignited congressional debate over whether and how to streamline copyright licensing for satellite transmission of broadcast television programs, one key lawmaker wants to emphasize that "harmonization for harmonization sake has never made a whole lot of sense." House Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., believes that there are key differences between cable and satellite systems and lawmakers should carefully weigh calls to unify the platforms' statutory language. "We ought to look at the differences and to the extent that different treatments are still called for on account of those differences, resist harmonization for harmonization sake," Boucher said in a Wednesday interview.
Two major questions before his subcommittee as they reauthorize the Satellite Home Viewer Act are whether satellite providers should offer local service to all 210 market areas nationwide and whether there should be a general rule for signals where market areas straddle state lines, Boucher said. About 30 markets lack local-to-local coverage entirely, many of which are rural areas like Boucher's own district. A fairly non-controversial item is moving language that pertains to significantly viewed channels from one section of copyright law (Sec. 119) to another (Sec. 122), which covers local-into-local service. "I think there's uniform agreement that we should make that change," Boucher said.
Read more about potential complications in the Satellite Home Viewer Act reauthorization efforts in Thursday's CongressDaily AM Edition (subscription required).
Senate Judiciary Chairman Patrick Leahy and House Judiciary Chairman John Conyers will join House Foreign Affairs Chairman Howard Berman, House Oversight and Government Reform ranking member Darrell Issa and Rep. Marsha Blackburn, R-Tenn., for a Tuesday briefing on legislation they introduced to end a longstanding copyright royalty exemption granted to AM and FM radio stations. The rally organized by the MusicFirst Coalition will feature appearances by artists and musicians from across genres and decades.
The House and Senate Judiciary committees will put executives from Live Nation and Ticketmaster on the hot seat this week as they examine the pair's $2.5 billion merger plan, now under Justice Department review. Senate Judiciary Antitrust Subcommittee Chairman Herb Kohl, D-Wis., will chair a Tuesday hearing and the House Judiciary Courts and Competition Policy Subcommittee, chaired by Rep. Hank Johnson, D-Ga., will follow up Thursday. Read a CongressDaily preview story here (subscription required).
The Property Rights Alliance will unveil its 2009 International Property Rights Index at the National Press Club on Tuesday. The event will be followed with a discussion by a panel of experts on what the rankings means for property rights in the 111th Congress and around the globe. The alliance's annual study measures the significance of physical and intellectual property rights and their protection for economic well-being. The index includes data for 115 countries, representing 96 percent of world GDP.
The Coalition for Patent Fairness, a group backed by major high-tech and media firms who want Congress to pass substantial overhauls to the U.S. patent system, is refocusing its message this year to highlight what its member companies argue would be the positive economic impact of updating the patent regime. "Deficiencies in our patent system are holding our economy back by dampening innovation and job creation. Congress needs to pass a bipartisan and comprehensive patent reform bill to modernize and reduce uncertainty in the current system," the group said in a Wednesday statement. Senate Judiciary Chairman Patrick Leahy plans to introduce patent legislation in the near term and the House will follow suit.
The coalition has also revamped its Web site and introduced a new blog called "The Better Mouse Trap." The blog is named as a nod to America's tradition of innovation and will be updated regularly to track legislative and regulatory developments and highlight member company activity, the group said. CPF will have plenty of challenges in the 111th Congress. Manufacturing giants recently launched the Manufacturers Alliance on Patent Policy in hopes of influencing the debate. They join the Innovation Alliance, whose small and medium-sized firms oppose many of the modifications; and the Coalition for 21st Century Patent Reform, a multi-industry entity that has called for limited changes that pertain primarily to patent quality.
Recommendations for changing the patent litigation venue regime put forward by the last Congress are vague and subjective, which could result in confusion and excessive litigation, according to a report released Wednesday by the Progress and Freedom Foundation. PFF visiting fellow Sidney Rosenzweig's paper proposes simplified legislative language to address so-called "forum-shopping" as leaders of the House and Senate Judiciary Committees resume discussions about reintroducing patent legislation in the 111th Congress. The enactment of either bill from last session would "cause a tidal wave of venue-related disputes to drown the federal courts," he wrote.
Rosenzweig proposes the following revision to 28 U.S.C. § 1400(b) to address the only concrete problem identified by Congress, "namely the lax standard for venue against corporate defendants" --
'Notwithstanding subsection 1391(c) of this title, any civil action for patent infringement may be brought against a corporation only in a judicial district--
'(1) where the defendant has its principal place of business or where the defendant is incorporated;
'(2) where the defendant has committed a substantial portion of the acts of infringement and has a regular and established physical facility that it controls;
'(3) where any defendant has committed a substantial portion of the acts of infringement and has a regular and established physical facility that it controls, if there is no other district in which the action may be brought under subsections (1) or (2); or
'(4) where any defendant has its principal place of business, where any defendant is incorporated, where any defendant may be found, or where any defendant has committed acts of infringement, if there is no other district in which the action may be brought under subsections (1), (2) or (3).'
Canada, China, Russia and 10 other countries continue to pose the worst problems in 2009 with respect to protecting U.S. intellectual property rights, the American music, movie, software, and video game industries told the Office of the U.S. Trade Representative in an annual filing on Tuesday. The International Intellectual Property Alliance recommended that 13 nations be placed on the USTR's priority watch list and that 25 be placed or maintained on a less critical list when the official rosters are released by the U.S. government this spring. IIPA also requested that later this year, USTR conduct so-called "out-of-cycle reviews" of Malaysia, Spain and Saudi Arabia to evaluate their respective progress on specific IP issues.
"With the U.S. economy shedding jobs at an alarming rate, our government needs to redouble it efforts to stem massive global theft of U.S. copyrighted works in physical form and on the Internet," IIPA's Eric Smith said, noting that the USTR's Special 301 process is a critical tool in reducing piracy losses. Senate Finance Chairman Max Baucus and Sen. Orrin Hatch, R-Utah, introduced legislation in the 110th Congress that would beef up the report, which some stakeholders believe has become what aides called a "shaming exercise." Their proposal would have required trade officials to create an action plan for the worst offenders and harsh consequences for countries that do not comply. A spokeswoman for Baucus said her boss remains interested in the issue and is working with ranking member Charles Grassley to determine the best way forward.
The Recording Industry Association of America, American Federation of Musicians, the National Music Publishers Association and other music industry stakeholders issued a joint statement commending IIPA's recommendations. "In these troubled economic times, it is more important than ever that the U.S. government take meaningful steps to ensure that the most competitive parts of the U.S. economy -- those that contribute to positive balance of trade payments -- can effectively compete in global markets without facing unfair competition," the groups said. "The copyright industries generally, and the music community in particular, are among America's most competitive sectors, and our contribution to the public welfare goes well beyond our economic contributions."
Continue reading IP Crusaders Want Robust Anti-Piracy Agenda.
AM and FM radio stations that simulcast programming over the Internet or that create new stand-alone Internet stations reached a deal with digital royalty collector SoundExchange on Monday to provide discounts on previously set rates for 2009 and 2010 and establish rates for 2011-2015. Under the agreement, rates for simulcasts or Web channels operated by local stations are reduced for the first two years by about 16 percent then gradually increase through 2015 -- from $0.0015 per streamed sound recording in 2009 to $0.0025 per stream by 2015.
The National Association of Broadcasters has reached separate deals with individual record label groups that waive certain statutory format restrictions allowing, for example, certain artists to be played more often during a four hour period. The agreement was reached under the authority of the Webcaster Settlement Act, which passed Congress last September, and covers simulcasts over the Internet of all copyrighted commercially released musical performances. Meanwhile, the same parties involved in the agreement have just begun a battle on Capitol Hill over performance royalties that the music industry wants AM and FM radio stations to pay.
"Because of the explosive growth of music on the Internet, this is good news for everyone involved in music -- from artists to labels to broadcasters and to fans," SoundExchange Executive Director John Simson said in a press release. NAB spokesman Dennis Wharton said the arrangement "provides local radio stations with the ability to enhance their local service with an online component, boosting listeners' access to music, local news and information." The Webcaster Settlement Act was sponsored by Rep. Jay Inslee, D-Wash., and Sen. Ron Wyden, D-Ore.
Still to come: settlements between SoundExchange and small commercial webcasters; religious broadcasters; and members of the Digital Media Association.
Entertainment industry attorney Tom Perrelli, who is President Barack Obama's pick for associate attorney general, told the Senate Judiciary Committee during his confirmation hearing Tuesday that existing U.S. intellectual property laws "don't seem to be addressing the problem" of global counterfeiting and piracy and said he hopes the department will bring a renewed focus to the issue. Perrelli was most recently managing partner of Jenner & Block's Washington, D.C., office and co-chaired the firm's entertainment and new media practice. In that capacity, he represented record labels and movie studios in a variety of copyright court battles.
"This committee was the source of a bill that created a broader IP position through the administration," Perrelli pointed out. That legislation sponsored by Senate Judiciary Chairman Patrick Leahy and ranking member Arlen Specter became law in October. The measure toughened civil and criminal IP laws and provided new prosecutorial resources. It also created an IP enforcement coordinator within the White House -- a vacant position that Sen. Sheldon Whitehouse, D-R.I., urged the administration to fill.
During the hearing, Perrelli was also grilled by Sen. Tom Coburn, R-Okla., about legislation that he sponsored in the 110th Congress to expand the requirements for electronic service providers to report online child pornography and help to root out people selling, trading, or displaying illegal pornographic images of children. "We have to do everything we can to protect children from depictions that are going to be harmful to them," Perrelli said, pledging to work with the committee on child protection issues and help ensure that those who distribute unlawful Internet content are prosecuted.
Senate Judiciary Committee Chairman Patrick Leahy told Tech Daily Dose on Monday that legislation to overhaul the U.S. patent system will emerge soon and will look very similar to the version that passed his panel in the 110th Congress but did not reach the floor. Leahy, who plans to reintroduce the bill with Sen. Orrin Hatch, R-Utah, said his staff has made "a few changes" to the bill since last spring when he and ranking member Arlen Specter split over language to address how damages are awarded in infringement lawsuits. He declined to provide insight about whether his differences with Specter, which also pitted industry stakeholders against each other, had been worked out.
CongressDaily reported last month that Leahy and Hatch had resumed negotiations on the bill that passed their committee 13-5 in 2007. "We'll see this on a fast track," one individual close to the issue said. "The deal is there and it's ready to be made." The Senate Judiciary Committee patent debate will unfold with three new Democrats on the panel -- Sens. Ron Wyden of Oregon, Amy Klobuchar of Minnesota and Ted Kaufman of Delaware -- and an administration that favors changes in the patent system. In addition, Leahy's key patent staffer, Susan Davies, has become associate counsel for President Barack Obama.
Read CongressDaily's recent coverage here (subscription required).
House Judiciary Chairman John Conyers told a crowd of 300 in Los Angles, Calif. on Friday that passing legislation he introduced earlier this week to end a longstanding royalty exemption granted to AM and FM radio "is going to be a serious struggle" due to opposition from the National Association of Broadcasters. Moving the measure through the House -- and the Senate where a companion bill is sponsored by Judiciary Chairman Patrick Leahy -- will require the help of the labor and civil rights movements in addition to music industry interests, he said. Conyers added the problem has "gone unremedied for too damned long." The bills received hearings but stalled in the Judiciary Committees in the 110th Congress.
Conyers appeared at a town hall-style Recording Academy event that preceded the music industry's biggest night of the year -- the 51st Grammy Awards on Sunday. He was joined by Rep. Darrell Issa, R-Calif., and Marsha Blackburn, R-Tenn., who are original cosponsors of the bill. The chairman noted the legislation is "a work in progress" and invited his audience to provide input. Blackburn pointed out the House version includes enhanced protections for songwriters but the Senate version does not. She vowed to ensure that both bills would contain that language before the legislation goes to conference. [Read CongressDaily's recent coverage here]
Continue reading Conyers: 'Serious Struggle' For Royalty Bill.
High-tech watchdogs are abuzz over leaked information from ongoing international negotiations surrounding the Anti-Counterfeiting Copyright Agreement. The Electronic Frontier Foundation sent an e-mail to supporters Friday claiming the pact between the U.S. and a handful of trading partners "threatens to shift the balance of copyright law across the world, with little or no oversight from lawmakers." A fifth round of deliberations -- the first on President Barack Obama's watch -- is slated to take place in Morocco next month. Some expect the document, which has been in the works for over a year, could be ready for signing by then, EFF states. [Read CongressDaily's recent coverage here]
Draft language from the closed meetings suggests provisions of ACTA will include mandated disclosure of personal information in alleged IP disputes, a new global requirement that "commercial scale" piracy will also capture non-commercial copies, and new powers to place injunctions on IP violations with lowered standards of proof and limited due process, EFF argues. An entire section is also reportedly devoted to "rights management technology/the Internet." Much of the language is reminiscent of entertainment industry demands, the group states.
Of over 1,300 pages of ACTA background documents requested by EFF in a Freedom of Information Act request last year, 159 were released to the public by the U.S. Trade Representative. EFF and Public Knowledge are currently involved in a pending federal lawsuit to obtain more information. EFF has also urged Congress to do more by telling the USTR to "open up the ACTA process to true oversight and deliberation, and demand it keep to its original agenda of fighting counterfeit fake products and commercial piracy on behalf of consumers." Read more here and here.
Former House Majority Leader Richard Armey, R-Texas, who represents music industry clients at DLA Piper, said he plans to lobby hard this Congress in favor of legislation that would end a longstanding music royalty exemption granted to AM and FM radio stations. On Wednesday, House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy simultaneously introduced bills that would make the change, which the National Association of Broadcasters has vowed to fight. Armey called upon former colleagues last year on behalf of the MusicFirst coalition, which is backed by the Recording Industry Association of America, SoundExchange, the American Federation of Musicians and others. Read CongressDaily's AM Edition story here.
"There has to be a clarification in this anomaly in the definition of property rights," Armey told Tech Daily Dose, saying he believes the legislation has "a very good chance of being passed." In the 110th Congress, the measure was approved by the now-defunct House Judiciary Courts, the Internet and Intellectual Property Subcommittee and the Senate version stalled in the Judiciary Committee without a mark-up. A House resolution opposing the effort gathered more than 200 supporters. "This is a small increase in expense for the number one product radio puts out," Armey said, noting there are exemptions written in for talk radio and religious broadcasters and a lower rate for noncommercial entities.
In related news, Armey said music industry interests have largely wrapped up final negotiations this week on an agreement with broadcasters to lower the royalties that over-the-air stations pay for songs they stream on the Internet in advance of a Feb. 15 deadline. "[Broadcasters] were perfectly willing to sit down and talk about how to diminish their burden of responsibility on the Internet... but when it comes to the question of sitting down to talk about compensation for over-the-air broadcast, they won't talk at all," he said. Parties in those negotiations have agreed not to speak publicly about the discussions, which have been going on for many months.
Antony Taubman will assume the top intellectual property position at the World Trade Organization, Intellectual Property Watch reports. He is slated to start his new job on May 1. Taubman has been serving as acting director of the global IP issues division of the World Intellectual Property Organization. He has a background serving as a diplomat and previously worked in Australia, according to the WIPO Web site. President Barack Obama's agenda includes working "to ensure intellectual property is protected in foreign markets, and promote greater cooperation on international standards that allow our technologies to compete everywhere." -- Winter Casey
House Judiciary Committee Chairman John Conyers late Tuesday introduced legislation that would overturn a recent mandate that the National Institutes of Health require federally supported scientists to submit their research manuscripts for free public access on the Internet. The requirement passed as part of the fiscal year 2008 Labor-Health and Human Services appropriations bill without allowing input by committees with expertise and oversight on copyright. The bill is co-sponsored by Reps. Steve Cohen, D-Tenn., Trent Franks, R-Ariz., Darrell Issa, R-Calif., and Robert Wexler, D-Fla.
Last September, Conyers slammed the powerful House Appropriations Committee for not consulting with his panel (see CongressDaily story). "We have tried to communicate repeatedly with the leader of that committee ... and what did we get? Nothing," Conyers said at a hearing of the Courts, the Internet and Intellectual Property Subcommittee. He said he viewed the silence as a blow-off by Appropriations Chairman David Obey and said he was frustrated that appropriators ran roughshod over the "sacred jurisdiction" of his committee to act "summarily, unilaterally and probably incorrectly."
Open access and consumer advocates championed the NIH's new requirement while publishers panned it, arguing that it could put subscription-based scientific journals out of business. "The mere fact that a scientist accepts as part of her funding a federal grant should not enable the federal government to commandeer the resulting peer-reviewed research paper and treat it as a public domain work," Copyright Alliance Executive Director Patrick Ross said in a Wednesday statement. "Grants are provided to pay for the research and resulting data... But taking the scientist's copyrighted interpretation of the data is not fair to other funders, and it violates the rights of the publisher."
The chairman of Greater Media, which owns 23 AM and FM radio stations in Boston, Charlotte, Detroit, Philadelphia and New Jersey, is appealing to Web surfers who happen upon his "From The Corner Office" column to fight a forthcoming effort in Congress that would end an longstanding copyright royalty exemption granted to companies like his. In a open letter titled "Radio Needs your Help....Yes, You," Peter Smyth warns that the "performance tax has once again reared its ugly head" and the result could cost the radio industry between $400 million and $7 billion per year.
"There will be claims that this is a question of fairness and the money is needed to help recording artists. The fact is that the record companies - not individual artists - will be the primary beneficiaries of a performance tax on radio," Smyth writes. "The same companies who denied, resisted and ultimately blew their business in the transition to digital delivery now want to dig into the pockets of radio to save their skins." The bill's passage would force "a wholesale rethinking of our station's formats, our staffing, our ability to contribute to our communities, and how we run our business," he said.
One proponent of the legislation, which is expected to be introduced in the House soon, emailed to point out that the National Association of Broadcasters and its allies have heretofore quoted a $4-7 billion statistic. The $4 billion would be 25 percent of revenue; $7 billion would be 44 percent of revenue. Compared to what some have estimated to be the "real world" impact (around 3-7 percent since in the United States, songwriters get just under 3 percent), Smyth's message is off-kilter, the email said. "Either the new $400 million number is a bow to reality or a tacit admission that they know not of what they speak."
Former Patent and Trademark Office Director Jon Dudas has joined the law firm Foley & Lardner as a partner in the Washington, D.C. office, working with the intellectual property and public affairs practices. Dudas was nominated by President Bush in March 2004 and confirmed by the Senate several months later after having served for two years as deputy director. During his tenure at PTO, Dudas managed the day-to-day business of the $2 billion agency and its 9,000-plus employees and was vocal about legislative proposals aimed at overhauling the U.S. patent system.
In a Monday press release, Dudas said Foley was "a natural next step" after having served at PTO because the firm's IP practice earns high marks for litigation and prosecution. In his role as the nation's top patent official, Dudas spearheaded a number of patent cooperation and development missions with the European Union, China, Japan, Korea and other countries and made progress toward "patent work-sharing," which could enhance efficiencies in patent examination at the PTO and achieve better U.S. patent protection abroad. Earlier in his career, Dudas served as counsel to the House Judiciary Subcommittee on Courts and Intellectual Property and was staff director for the House Judiciary Committee.
"Jon brings a unique mix of talent and experience leveraging both his distinguished tenure within the federal government and his experience as a litigator established prior to his government service," Foley IP chief Sharon Barner said. "Foley's global IP practice and its increasing global patent litigation will benefit from Jon's integration with our multinational patent enforcement teams."
President Barack Obama spoke with China's President Hu Jintao on Friday morning about their intention to build a more positive and constructive relationship between the countries, the White House press office said in an e-mail. According to the summary, Obama and Hu discussed the international financial crisis and agreed that increased close cooperation between the U.S. and China is vital. Obama stressed the need to correct global trade imbalances -- an issue important to the high-tech sector -- as well as to stimulate global growth and get credit markets flowing.
The two presidents agreed to work together on several global issues, specifically mentioning North Korea, Iran, Afghanistan/Pakistan, counterterrorism, proliferation, and climate change. Obama expressed appreciation for China's role as chair of the so-called Six-Party Talks and they affirmed the importance of denuclearization of the Korean peninsula. What is unclear is whether intellectual property protection factored into the conversation. The U.S. business community -- particularly those in the entertainment, software and manufacturing industries -- have urged the new administration take hard line against piracy and counterfeiting.
China has long been cited by the U.S. government as one of the world's worst IP offenders and regularly tops the Office of the U.S. Trade Representative's watch list of nations that have weak IP protection regimes. In recent years, Hu has made speeches pledging to work harder to crack down on bootleggers but many policy watchers have been skeptical of whether change is actually happening on the ground.
From Friday's CongressDaily PM Edition:
A Senate bill that would make sweeping changes in the U.S. patent system is moving closer to reintroduction, according to sources close to the talks. Staffers for Judiciary Chairman Patrick Leahy and Sen. Orrin Hatch, R-Utah, have resumed negotiations on legislation that passed the committee 13-5 in 2007 but died after Leahy could not win Judiciary ranking member Arlen Specter's support to bring the bill to the floor last spring. The two split over language that would address how damages are awarded in infringement lawsuits -- an issue that bitterly divided industry stakeholders as the bill moved through committee.
Leahy and Specter have indicated that patent legislation is the top priority on their intellectual property agendas, and sources said a bill is expected early in the first session of this Congress, with possible hearings scheduled for March or April. "We'll see this on a fast track," one individual close to the issue said. "The deal is there and it's ready to be made." Read the full story in CongressDaily here (subscription required).
The National Foreign Trade Council on Friday launched its Global Innovation Forum, which will focus on international innovation policy issues, including global trade rules and the protection of intellectual property rights worldwide. The U.S.-based business group for multinational companies believes innovation is critical to solving global challenges and is one of the single most important drivers of economic growth. Millions of workers depend on fair trade rules to produce solutions to pressing global challenges such as improving public health, creating environmental sustainability, securing access to food and nutrition and raising global living standards, the NFTC said.
"There are few more cost effective ways to stimulate the economy than to ensure a predictable global IP system that protects jobs," NFTC President Bill Reinsch said in a press release. The forum will set up a Web site next month focused on its core issues and the group intends to hold a series of meetings to advance a dialogue among business stakeholders and workers, consumer groups, international development organizations and policymakers. Forum Executive Director John Stubbs added that the global economic slowdown is creating new pressures on both innovators and consumers. "These challenges will be met by the hard work of creative minds in the United States and around the world."
A World Trade Organization dispute settlement panel Monday found important aspects of China's intellectual property rights regime to be inconsistent with the country's obligations under a long-standing intellectual property treaty, Acting U.S. Trade Representative Peter Allgeier said. The United States brought claims against China out of concern about shortcomings in the country's legal regime for protecting and enforcing copyrights and trademarks on a range of products.
The WTO panel's ruling is an important victory, he said, because it clarifies key provisions of the IP deal that was negotiated for eight years ending in 1994. Specifically, the panel found that China's denial of copyright protection to works that do not meet its "content review" standards is impermissible. The panel clarified China's obligation to provide for criminal procedures and penalties to be applied to willful trademark counterfeiting and copyright piracy on a commercial scale. Allgeier said USTR will "engage vigorously with China on appropriate corrective actions to ensure that U.S. rights holders obtain the benefits of this decision."
Motion Picture Association of America Chairman Dan Glickman issued a statement saying the WTO decision was "welcome news for creators" but he was disappointed that the panel "did not accept the strength of the U.S. argument that China's thresholds for taking criminal action do not deter rampant piracy." Copyright Alliance Executive Director Patrick Ross also cheered the announcement but said it took too long to conclude. "The Chinese government has been passionate in its words but passive in its deeds when enforcing intellectual property rights," he said.
A trade group that represents Google, Microsoft, Sun Microsystems and other high-tech firms in Washington urged President Barack Obama on Monday to appoint leaders at the Commerce Department and Patent and Trademark Office to who can bring reform and encourage innovation. "We have to recognize that the entire intellectual property system - patents, copyrights and trademarks - is in crisis and loosing credibility," Computer and Communications Industry Association President Ed Black said. "IP policy has been administered with a sort of 'you're with us or against us approach' and you couldn't propose reforms without being pigeonholed as anti-IP," he said, noting that he believes too much IP protection can be as harmful as too little.
CCIA also asked the new administration to designate an undersecretary for intellectual property who can address the broad challenges in innovation policy facing the nation. "We need someone who is a visionary, as well as a manager and a diplomat," Black said. The PTO can be important to making innovation work, but it needs to be connected to broader thinking about innovation and concerned with results, not just churning out patents, he said in a press release. In addition, CCIA has advocated for an independent Institute for Innovation Economics and Patent Policy to provide evidence-based analysis -- a key element to making the system work for all. Obama's picks for Commerce secretary and PTO director have not been unveiled but buzz is building about Symantec CEO John Thompson for a Cabinet post.
The U.S.-India Business Council released a statement Friday saying it is hopeful that the India release of the hit film "Slumdog Millionaire" will prompt authorities to recognize the importance of protecting intellectual property and to increase enforcement efforts against film and video pirates. The movie about an orphan growing up in the slums of India received 10 Academy Award nominations this week, including best picture and best director. A recent study commissioned by USIBC as part of its Bollywood-Hollywood Initiative found that India's entertainment and media industry loses some 820,000 jobs and about $4 billion to piracy each year.
"Piracy translates directly into lost opportunities and lost jobs - and squandered creativity," USIBC President Ron Somers said in a press release. "Imagine how many 'Slumdogs' could be conceived, produced and premiered if only there were greater efforts to crackdown on film piracy." Indian media and entertainment is an $11 billion industry growing at over 18 percent annually, USIBC said. "Slumdog Millionaire is just the latest example of the growing connection between Bollywood and Hollywood," said Greg Kalbaugh, the group's director. "The entertainment industries of the U.S. and India are increasingly intertwined, but widespread piracy threatens industry in both countries."
House Judiciary Committee Chairman John Conyers and other proponents of forthcoming legislation that would end a longstanding music royalty exemption afforded to AM and FM radio stations circulated a "Dear Colleague" letter on Wednesday advising members that they will likely be presented with a resolution in the coming days that is intended to thwart the effort -- potentially before their bill in introduced. "While the resolution will be framed in terms of preventing a 'tax,' 'fee,' or 'burden' on local radio stations, in reality, the only payment broadcasters would be required to make would be for the use of someone else's property," the letter said.
Conyers -- who was joined by Reps. Howard Berman, D-Calif., Darrell Issa, R-Calif., and Marsha Blackburn, R-Tenn., as signatories -- said the resolution being prepared by Texas Reps. Gene Green, a Democrat, and Republican Mike Conaway "is extremely detrimental to thousands of people and businesses, to the protection of American intellectual property abroad, to the economy and the balance of trade.: They urged fellow lawmakers not to sign the resolution and welcomed their participation "in the full discussion on this issue that will be before the Judiciary Committee in the coming weeks." The Green-Conaway resolution gathered more than 200 supporters in the 110th Congress.
National Association of Broadcasters spokesman Dennis Wharton fired back, saying it is "implausible to suggest that a government-imposed bailout of foreign record labels estimated to cost up to $7 billion would not cause serious economic harm to U.S. radio stations." He said the media business faces the worst advertising climate in decades and thousands people have lost their jobs in the last few months. "If Congress wants to ensure more job losses... passing the performance tax would be the best recipe," Wharton said.
The Technology Association of America, the trade group formed from the recent merger of the Information Technology Association of America and the American Electronics Association, urged the Federal Acquisition Regulations Council to return to the drawing board on a proposed rulemaking on IT products. The panel has proposed strict, unlimited liability on government contractors who introduce faulty or counterfeit IT products, the group said in a Thursday press release. FAR's proposed approach is not well suited to enforce contractor performance specifications and is unlikely to prevent "Trojan horses," "back doors" or other security concerns, TAA said.
In a Jan. 20 letter the association noted that "laws and regulations are in place to combat faulty products and fraudulent contractors. If enforced, the existing laws are sufficient to address a situation in which a contractor delivers a defective or faulty product." TAA recommended that "the contractor community and the government act as partners to identify and eliminate counterfeit IT products and demonstrate the security of the supply chain, rather than placing the burden on contractors and systems integrators with strict, unlimited liability."
As a possible alternative solution, TAA suggested that FAR to consider a "safe harbor" approach in which contractors must demonstrate reasonable steps to prevent the delivery of unauthorized products. This would include robust compliance processes throughout each level of the supply chain or production -- and a contractor would not be liable when fraud perpetrated by a supplier cannot be prevented.
Premium television channel HBO is demanding that video sharing Web site YouTube take down postings of the free public concert that preceded the inauguration of President Barack Obama, including snippets filmed on attendees' cellular phone cameras, according to blog reports on Wednesday. HBO reportedly is claiming it has the exclusive copyright for the video of this event because it purchased a six months license from the inaugural committee, which owns the license. The concert was broadcast on HBO (which descrambled the channel so basic cable subscribers could watch) and on HBO.com.
CCIA President Ed Black denounced HBO's alleged actions, saying that "if their ridiculous interpretation of the law is true, tens of thousands of citizens recording memories at this historic public event could have broken the law and be held liable for statutory damages that can be up to $150,000 each." Black argued that those sharing their memories on YouTube or other formats should be covered under copyright's "fair use" provision. "It's yet another example of the outrageous, excessive attitude of certain big content companies," he said.
The New York Times reported that the "We Are One" extravaganza at the foot of the Lincoln Memorial cost HBO $2.5 million. Within HBO's 29 million subscribing households, the live broadcast and the two prime-time replays on Sunday were watched by a total of 4.1 million viewers. The HBO.com video was viewed about 700,000 times on Sunday and Monday, HBO said.
After many months of negotiating, digital royalty collector SoundExchange and the Corporation for Public Broadcasting have come to an agreement on Internet royalties for non-commercial educational public radio. The arrangement, which stems from a controversial May 2007 ruling of the Copyright Royalty Board, covers a period from Jan. 1, 2005 through Dec. 31, 2010. Under the deal, SoundExchange will receive a single payment of $1.85 million plus consolidated usage and playlist reporting from CPB on behalf of the entire public radio system.
The settlement will cover about 450 public radio webcasters including CPB supported stations, National Public Radio, NPR members, National Federation of Community Broadcasters members, American Public Media, the Public Radio Exchange, and Public Radio International. NPR has also agreed to withdraw its appeal of the CRB royalty rate decision. "This important agreement will ensure that the artists heard on public radio station Web sites will receive compensation and will enable public radio webcasters to continue to meet their public service, non-profit missions," CPB President Pat Harrison said in a statement.
SoundExchange still has plenty of work to do, executive director John Simson told Tech Daily Dose. The group continues to negotiate with the Digital Media Association, which represents major digital content services, but "every time we seem to get really close, some new issue crops up," he said. Simson's staff is also in talks with the National Association of Broadcasters to reach an agreement on fees for programming that is simulcast online. Additionally, SoundExchange is hammering out a royalty scheme for a group of small commercial webcasters and a separate agreement with noncommercial entities that are not part of NPR or CPB, Simson said.
America's longstanding dominance of new U.S. patents may be slipping but the economic downturn has not stemmed the overall flow of patent activity, according to a compilation of the world's top-ranked U.S.-patent companies released Wednesday from IFI Patent Intelligence. The analysis shows the Patent and Trademark Office issued 157,774 utility patents in 2008, up slightly over 157,284 in 2007.
IBM still tops the list and is ahead by a relatively wide margin but "the scales of patent-quantity supremacy may be shifting away from corporate America in favor of companies overseas, especially to those in Asia," the firm said. IBM set a new all-time record of 4,186 patents, up 33 percent over 2007. Samsung was in second place with 3,515, up 29 percent; followed by Canon at number three, with 2,114. Microsoft ranked fourth with 2,030, up 24 percent over the prior year. Other notable companies include Intel, Broadcom, Cisco, Hon Hai of Taiwan, Fujifilm and LG Philips LCD.
"American companies garnered a minority share of the total number of corporate U.S. patents last year, it's important not to confuse quantity with quality," IFI's Darlene Slaughter said in a press release. "Many of the world's largest companies are placing a higher priority on protecting their intellectual property. Securing patents may be even more important in a down economy, since it gives patent-holders an edge over their competitors." She noted that many of the patents granted in 2008 were applied for in 2005 and 2006, so the economy had little, if any, effect on approvals.
An industry group representing the interests of major high-tech and media companies in the patent reform battle on Capitol Hill lauded a report released Monday by the Center for American Progress that called for legislative solutions to enable the patent system to promote, rather than inhibit, innovation and economic recovery. "We applaud CAP for recognizing that current patent law standards governing assessment of damages and the locations where suits may be filed are obstacles to innovation that must be reformed," the Coalition for Patent Fairness said in a statement.
Business Software Alliance President Robert Holleyman also lauded the paper, saying that he was "pleased that another important, influential organization... has joined a growing list of advocates calling for patent reform." Key critics of legislation that advanced in the House and Senate in the 110th Congress include the pharmaceutical and biotechnology industries as well as independent inventors and small firms whose business models depend largely on patent licensing. For more on the CAP report, read CongressDaily's coverage here (subscription required).
If Harvard Law School Dean Elena Kagan is confirmed as President-elect Barack Obama's Solicitor General, she will have the opportunity early in her tenure to weigh in on a major copyright case pending before the Supreme Court. On Monday, the court asked for the views of the federal government's top litigator on new technology for downloading cable television programs but did not specify a timeline for the advice. With eight days left in President's Bush term, the duty will most likely fall to the new administration.
The case in question -- Cable News Network, et al., v. CSC Holdings - was originally brought by several audio-visual content creators against Cablevision, which has developed a service used to make numerous copies of copyrighted programming and re-transmit them to customers without licensing that delivery from copyright owners. A lower court found the service to be a violation of copyright law but an appeals court overturned that decision. An array of copyright holders offered briefs on the matter.
The SCOTUS Blog called the case "a modern sequel to the breakthrough for consumers that originated in 1976 when Sony Corp. introduced Betamax, allowing users to use time-shifting devices to record TV programs for later viewing." The Supreme Court, in Sony v. Universal City Studios in 1984, ruled that consumer time-shifting does not infringe copyright in the programs. Since then, there have been two generations of successor technology. The latest of those is at issue in the new case, the blog stated.
A key Senate proponent for U.S. intellectual property protection confirmed Monday his plans to not seek re-election in 2010. Sen. George Voinovich, R-Ohio, issued a statement in advance of an already scheduled afternoon news conference saying that "after prayerful consideration and much thought, my wife Janet and I have decided that I will not seek a third term." "These next two years in office, for me, will be the most important years that I have served in my entire political career," Voinovich said. "I must devote my full time, energy and focus to the job I was elected to do, the job in front of me."
Early in the 110th Congress, Voinovich partnered with Sen. Evan Bayh, D-Ind., to introduce an IP enforcement bill -- portions of which were combined with a multifaceted proposal by Senate Judiciary Committee Chairman Patrick Leahy and ranking member Arlen Specter. In October, President Bush signed the Leahy measure, which toughened civil and criminal laws against counterfeiting and piracy, provided enhanced IP enforcement and prosecutorial resources, and improved IP coordination within the executive branch. Voinovich becomes the fourth Republican Senate incumbent to decide to step down in 2010. More details on Voinovich's decision and the field of likely candidates to replace him will be available in CongressDaily's PM edition.
U.S. Trade Representative Susan Schwab urged President-elect Barack Obama's administration Thursday to continue the momentum on an Anti-Counterfeiting Trade Agreement, which the United States and several trading partners have been working on for more than a year. Since the deal involves the rapidly evolving high-tech and content industries, time is of the essence, she told CongressDaily at the Consumer Electronics Show. "Unless we find a way to protect intellectual property we're going to continue to hemorrhage billions of dollars worth of income and jobs," she said. Read the full story in CongressDaily's AM Edition.
From CongressDaily's AM Edition:
Two high-profile trade groups that represent music industry interests on Capitol Hill are joining forces in a no-holds-barred battle against the National Association of Broadcasters as the 111th Congress begins. The Recording Artists' Coalition, which gained attention for its superstar supporters like Christina Aguilera, Don Henley and Madonna, is being swallowed by the Recording Academy, the group best known for producing the annual Grammy Awards and Grammys on the Hill educational program, officials told CongressDaily.
A bill sponsored last year by House Judiciary Chairman John Conyers passed a key subcommittee and a companion measure was introduced by Senate Judiciary Chairman Patrick Leahy. Broadcasters called the proposal "a tax on local radio" and mounted a campaign in opposition. A resolution by Texas Reps. Gene Green, a Democrat, and Republican Mike Conaway, garnered over 200 co-sponsors. Read the full story in CongressDaily (subscription required).
Tech Daily Dose Extra: Daryl Friedman, the Recording Academy's top lobbyist, said there is plenty more on his group's agenda on Capitol Hill. A tax bill that passed years ago in the wake of the Enron scandal but took effect this year to limit a loophole in executive compensation could negatively impact musicians who get advanced payment for their work, he said. It is a common practice in the music business to pay a portion of an artist's fee before the end of a contract. The sporting industry is also worried about the tax law change and will likely team up with Friedman's group to push for a legislative correction.
One of the nation's leading media and entertainment lawyers -- and a court crusader for the recording industry -- is President-elect Barack Obama's choice for associate attorney general. The announcement about the appointment of Tom Perrelli, currently managing partner of Jenner & Block's Washington, D.C. office and co-chair of the firm's entertainment and new media practice, was made Monday along with picks for several other Justice Department posts. If confirmed, Perrelli will not be new to DOJ headquarters. He served for two years in the late 1990s as counsel to Attorney General Janet Reno and subsequently rose to deputy assistant attorney general in the Clinton administration.
In 2005, Perrelli was named one of the nation's 40 most promising lawyers under 40 by The National Law Journal for exhibiting "extraordinary achievements" in his career. At Jenner & Block, he has represented the recording industry in intellectual property, technology, and anti-piracy litigation. Proceedings have included a host of cases arising under the Digital Millennium Copyright Act and a series of copyright royalty proceedings before the Copyright Royalty Board. Perrelli has also represented Democratic voters and elected officials in redistricting litigation arising out of the 2000 Census.
A Chinese court on Wednesday sentenced 11 ringleaders of the world's largest software counterfeiting syndicate to prison sentences ranging from 1.5 to 6.5 years -- the longest sentences handed down in China's history for this type of crime. Those sentenced by the Futian People's Court were arrested in July 2007 following an international investigation led by China's Public Security Bureau and the FBI, and assisted by information provided by Microsoft and hundreds of its customers and partners.
The group manufactured and distributed upwards of $2 billion worth of high-quality counterfeit Microsoft software, the high-tech giant said in a press release. The counterfeit content -- found in 36 countries and on five continents -- contained fake versions of 19 of Microsoft's most popular products and was produced in at least 11 languages. "This case is a testament to the importance of Microsoft's commitment to close collaboration with government bodies and local law enforcement agencies around the world to bring these criminals to justice, wherever they may be," Microsoft anti-piracy chief David Finn said.
Moving forward, Microsoft will continue to work with Chinese authorities to ensure that counterfeit software does not undermine the development of China's knowledge economy, said Fengming Liu, vice president of Microsoft Greater China Region. "This case is also a strong demonstration of the improvement in criminal law legislation and enforcement of intellectual property rights in China," added Zhao Bingzhi, president of the Criminal Law Research Committee of the China Law Society and vice president of the China Group of the International Association of Penal Law.
A federal panel charged with determining music royalty rates proposed changes Tuesday that would alter reporting requirements for services that pay fees for the use of sound recordings to SoundExchange, an entity that collects and distributes money owed to the music industry. The proposed new rules by the Copyright Royalty Board would require that "reports of use" submitted by certain services contain "full census reporting" of all songs played. Among those affected include Internet radio, satellite radio, digital cable radio and others, according to telecom attorney David Oxenford. The current system only requires reporting for two weeks each quarter.
"Where this change is likely to have the most impact is in connection with the operations of broadcasters who also stream their programs on the Internet," Oxenford said on his Broadcast Law Blog. "Noncommercial broadcasters, such as college radio stations, have repeatedly complained that their small staffs do not have the ability to maintain these electronic records, especially where the stations are volunteer-programmed by DJs who select their own music on the spot," he said. Oxenford represented small webcasters in a controversial recent proceeding on Internet royalties, which got the attention of consumer groups and members of Congress.
Comments on the proposal (which can be viewed here) are due by Jan. 29, 2009.
The U.S. Copyright Office has received 19 proposals for classes of works to be subject to anti-circumvention exemptions within the Digital Millennium Copyright Act and is seeking public comment on them, officials said this week. The purpose of the proceeding is to determine whether there are particular technologies or applications as to which users are, or are likely to be, adversely affected in their ability to make non-infringing uses due to anti-piracy (digital rights management) mechanisms.
Some of the proposed classes include:
▪ Subscription based services that offer DRM-protected streaming video where the provider has only made available players for a limited number of platforms, effectively creating an access control that requires a specific operating system version and/or set of hardware to view purchased material.
▪ Motion pictures protected by anti-access measures, such that access to the motion picture content requires use of a certain platform.
▪ Computer programs that enable wireless telephone handsets to execute lawfully obtained software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications with computer programs on the handset.
▪ Computer programs in the form of firmware that enable wireless telephone handsets to connect to a wireless telephone communication network, when circumvention is accomplished for the sole purpose of lawfully connecting to a wireless telephone communication network, regardless of commercial motive.
Continue reading Exemptions To Anti-Piracy Statute Proposed.
Three individuals were sentenced to prison Friday for their roles in an online copyright infringement scheme involving the sale of counterfeit software worth $2.5 million, Acting Assistant Attorney General Matthew Friedrich said in a press release. The case is part of the Justice Department's ongoing initiative to combat the commercial distribution of pirated and counterfeit goods through online auction sites and other Web sites. The defendants: Thomas Rushing of Wichita Falls, Texas; Brian Rue of Denton, Texas; and William Partridge of Royse City, Texas, were sentenced by U.S. District Judge Sam Sparks in Austin.
Rushing was sentenced to three years behind bars, threes years of supervised release and a $10,000 fine. In addition to the prison term, Rushing also was ordered to forfeit his 2006 Porsche Cayenne purchased with illegal proceeds and about $40,000 seized from bank accounts. Rue and Partridge were each sentenced to 12 months and one day in prison, three years of supervised release and a fine of $3,600. Rue was also ordered to forfeit roughly $17,000 seized from a bank account he controlled and Partridge was ordered to forfeit a 46" high-definition TV purchased with illicit funds.
According to court documents, the trio operated Web sites that sold a large volume of downloadable counterfeit software without authorization from copyright owners. The defendants also promoted their illicit scheme by purchasing advertising for their Web sites from major Internet search engines. As part of his ruling, Judge Sparks ordered the forfeiture of the Web site domain names --"valuesoftwaresales.com," "allsoftwaredownload.com," "esoftwarevalue.com" and "priceslashsoftware.com" -- used in the sale of pirated software.
President-elect Barack Obama's pick of former Dallas Mayor Ron Kirk for his U.S. Trade Representative slot on Friday was embraced by key intellectual property stakeholders as it was being panned by many in the labor community. The U.S. Chamber of Commerce's Mark Esper wrote on the business group's blog that Kirk has a solid track record of appreciating the value of America's IP-intensive industries and quoted from a 1998 Dallas Morning News article to make his point.
As mayor of Dallas, Kirk praised a plan to bring more biotechnology companies into the city calling it "an opportunity to develop an entire new economy based upon intellectual property that we already have principally coming from Southwestern Medical Center and our entire medical infrastructure.'" The plan, which developed a long-term vision for the city's future, was aimed at making Dallas a national hub for inventions. Esper noted that the next USTR will face a host of important IP issues and the Chamber is prepared to work with Kirk "in defense of innovation at home and abroad."
Meanwhile, Motion Picture Association of America Chairman Dan Glickman issued a statement congratulating Kirk, saying he "has the leadership skills and experience to forge a successful trade agenda." "Trade and related issues are crucial to the vitality of the film industry and paramount to the recovery of the global economy... We look forward to working with him," Glickman said.
The Recording Industry Association of America will drop its campaign of lawsuits against people allegedly sharing music online illegally, according to the Wall Street Journal. Instead, the trade group for major music labels said it will try to rely on Internet service providers to make a dent in file-sharing through graduated responses. The RIAA said it has arrived at preliminary agreements with ISPs under which it will send an e-mail to the provider when it finds a provider's customers making music available online for others to take, the newspaper reported. The RIAA does, however, plan on continuing with outstanding lawsuits.
RIAA Chairman Mitch Bainwol believes the new strategy will reach more people, which itself is a deterrent. "Part of the issue with infringement is for people to be aware that their actions are not anonymous," he told the newspaper, noting that the marketplace has changed in recent years. Litigation was successful in raising public awareness that file-sharing is illegal, but now he wants to try a strategy he thinks could be more successful. Public Knowledge President Gigi Sohn lauded the news but noted RIAA's work with ISPs must ensure "customers are not cut off from their Internet service or have their service altered solely on the basis of a claim by a copyright holder that file-sharing is taking place."
From Thursday's CongressDaily PM Edition:
High-tech industry officials and privacy watchdogs hope President-elect Barack Obama's pledge to improve government transparency will apply to secret negotiations surrounding an Anti-Counterfeiting Trade Agreement, which the United States and several trading partners have been working on for a year. The proposal was unveiled by Trade Representative Susan Schwab in October 2007, and those involved wanted to finalize the deal before the end of the Bush administration.
For months, groups potentially impacted by the agreement have said too much planning took place behind closed doors. Two organizations filed a Freedom of Information Act lawsuit against USTR, and more than 100 public interest organizations have asked that the draft text of the document be made public. Now they may have to wait. Schwab's chief intellectual property negotiator, Stan McCoy, said recently he was in no rush to wrap up talks, and a meeting of stakeholders in Paris this week ended inconclusively. However, a USTR spokesman said today participants made "steady progress" this week and agreed on the importance of transparency and on holding further discussions.
The U.S. Chamber of Commerce on Friday will host a conversation with Patent and Trademark Office attaches from around the world who will share their experiences from their respective regions and provide information about best practices in obtaining, protecting and enforcing intellectual property rights outside the United States. Attachés from Brazil, China, Egypt, India, Switzerland, Thailand, and Russia are among those who will offer insight.
At the event, the Chamber's Global Intellectual Property Center will also release its long-awaited report to President-elect Barack Obama's administration on high-priority changes to the PTO. According to a draft report obtained by CongressDaily recently, the Chamber will urge the agency to overhaul the patent examiner production system; make administrative actions timelier; strengthen the PTO's relationship with the user community; enhance organizational management; and permit applicants to defer examination.
A handful of former PTO chiefs offered their own recommendations for PTO changes last week. Read that story here.
Stanford University Law School's Law, Science & Technology Program will launch an intellectual property litigation clearinghouse on Monday -- a first-of-its-kind online database that offers comprehensive information about IP feuds in the United States. The publicly available research tool will enable scholars, policymakers, lawyers, judges and reporters to review real-time data about IP disputes that have been filed across the country and analyze the efficacy of the system that regulates patents, copyrights, trademarks, antitrust, and trade secrets.
The clearinghouse will include data summaries, industry indices, and trend analysis together with a full-text search engine, providing detailed and timely information that cannot be found elsewhere in the public domain, officials said. Stanford Law School, along with its partner organizations (Cisco Systems, Oracle, Qualcomm, Intel, SAP and others) which funded the development and provided insight, will release the database in phased modules. The first includes more than 23,000 cases filed in U.S. district courts since 2000. Read more here.
The federal panel charged with setting music royalty rates and terms handed down its final determination Monday on fees pertaining to the reproduction and distribution of phonorecords (compact discs), including digital downloads under Section 115 of the Copyright Act. Under the proceeding, the rate to be paid to songwriters and music publishers for their works in physical recordings and permanent digital downloads is the larger of 9.1 cents or 1.75 cents per minute of playing time with a late payment fee of 1.5 percent. The rate to be paid for ringtones is 24 cents.
A deal struck by the National Music Publishers Association and the Recording Industry Association of America in 1997 set the per-song fee for physical recordings like compact discs at 9.1 cents but did not address digital delivery, which has been popularized in recent years by services like Apple's iTunes music store. Under the decision, the rate for CDs and digital downloads will be frozen for five years. The board rejected an appeal that publishers be moved to a percentage rate rather than a penny rate. The 109th Congress considered legislation to set royalty rates but the bill fizzled and did not reappear this session.
Rumors are swirling in the intellectual property policy community about who might be in the running for Patent and Trademark Office director under President Barack Obama. CongressDaily took the pulse of some IP watchers and included a list of potential contenders in Monday's PM edition.
Some of the names circulating include: Q. Todd Dickinson, who ran the PTO under former President Bill Clinton and is now head of the American IP Law Association; Eli Lilly general counsel Robert Armitage; 3M IP counsel Gary Griswold; patent attorneys Ray Millien and James Pooley; and law professors Mark Lemley of Stanford and Arti Rai of Duke, a classmate of Obama's at Harvard Law School. Some possible picks were on the front lines of the congressional patent reform battle this year, which could be a disadvantage, sources said.
One name that was not included in the story but has been mentioned by some stakeholders is Shanna Winters. Winters, whose name was also reportedly in the mix for White House IP enforcement coordinator, is chief counsel to Rep. Howard Berman, D-Calif., who chairs the House Judiciary Courts, the Internet and IP Subcommittee. Berman plans to leave that post in the 111th Congress to chair the House Foreign Affairs Committee and reliable sources report that she plans to follow her boss to the new panel.
Meanwhile, an industry insider said that despite the names being whispered in Washington, the PTO director job is a "wild card." "Half the names you're hearing are because of self-promotion and the other half are logical," the source said, adding that the person who assumes the role must be a "well rounded candidate who has leadership and management experience" to lead an agency of 9,500 employees.
Surf on over to CongressDaily's TechCentral for a new "Issue of the Week." Here's a taste:
GENEVA, Switzerland -- The United Nations World Intellectual Property Organization was once viewed as a technical intellectual property protection body whose decisions got the attention only of copyright holders, patent-processing lawyers and their clients. Times have changed. Last month, the Geneva-based body came under the leadership of an Australian patent attorney, Francis Gurry, with a far broader vision: to tackle global economic decline, climate change and other threats through innovation and technology using the incentives of intellectual property rights.
"Humanity has always turned to technology for solutions in the face of global threats and challenges," Gurry said in a recent interview. "So, naturally, intellectual property as a system which seeks to incentivize investments and stimulate the creation of new technology, innovation and its diffusion is very pertinent to all of these challenges." Gurry plans to create a special division devoted to issues such as climate change, desertification, access to medicines and health, biodiversity preservation and food security. The organization has advertised for a global challenges czar as well as a chief economist, reflecting a trend toward economics at intellectual property bodies such as the U.S. Patent and Trademark Office.
"In the past, the WIPO secretariat has often been seen as a cheerleader for intellectual property owners. The hiring of chief economist is a big step toward the international leadership on intellectual property issues that WIPO should be providing," said Brian Kahin, senior fellow at the Computer & Communications Industry Association. "It is recognition of the need to understand and promote the economic goals of the system by improving how intellectual property works in the real world -- as opposed to simply amplifying the views of the most interested stakeholders."
Commerce Secretary Carlos Gutierrez appears to have reversed course on his opposition to the newly created intellectual property enforcement coordinator position within the White House. In an interview with CongressDaily this week, the former Kellog Co. chairman said the change "puts IP rights front-and-center [and] will make it a priority for the White House and not just for Commerce" where a similar post had been housed. Intellectual property enforcement is "such an important part of our future, we want it to cut across agencies," he said.
Language to establish the IP coordinator post was included in a broader bill sponsored by Senate Judiciary Chairman Patrick Leahy and ranking member Arlen Specter but the Commerce and Justice departments panned the idea as the legislation moved through Congress. President Bush signed the measure last month, which also authorizes new grants for state and local law enforcement and beefs up prosecutorial resources. As recently as October, Gutierrez's general counsel and a principal assistant attorney general called the bill a "legislative intrusion" and warned the change could "pose significant and unnecessary challenges."
Read more about the Gutierrez interview here.
Academics, industry executives, congressional aides and high-profile attorneys are among those whose names are swirling as potential candidates for the high-level White House job to oversee government-wide anti-piracy and anti-counterfeiting efforts in Barack Obama's administration. The position was written into a broader intellectual property bill sponsored by Senate Judiciary Chairman Patrick Leahy and ranking member Arlen Specter along with Sens. Evan Bayh, D-Ind., and George Voinovich, R-Ohio. President Bush signed the legislation last month.
Leahy will offer a list of names to Obama's transition team, but the post is viewed as "second-tier" -- one that will be addressed after Cabinet and other major nominations are made. Leahy's picks will be "pretty weighty," one source said, noting that he was one of several senators to endorse Obama over Sen. Hillary Rodham Clinton, D-N.Y., early in the Democratic primaries. Victoria Espinel, a Democrat who served as the first assistant trade representative for intellectual property, a position created by Trade Representative Susan Schwab in 2006, is a likely contender. Read CongressDaily for details on other names that have been floated...
Entertainment, software, and pharmaceutical industry executives share their perspectives on the role of intellectual property in commerce and innovation in a new white paper from the Washington Legal Foundation. The document, which examines the existing legal framework's ability to accommodate advances in technology and business, includes input by former Attorney General Dick Thornburgh and several corporate general counsels including Eli Lilly's Robert Armitage, Viacom's Michael Fricklas and Microsoft's Brad Smith.
“Copyright compensates artists and journalists and other creators for putting all these ideas into the public domain and encourages people to write and create in new ways.” -- Fricklas
“We have an obligation in our industry to be leaders in addressing counterfeiting problems on a global basis. For us, it is a life-and-death issue for the patients we serve.” -- Armitage
“We are concerned that some nations may seize on exclusions and interpret them broadly to deny patent protection for computer-implemented inventions.” -- Smith
Read "The Changing Legal Landscape For Intellectual Property" here (PDF).
Three Republican members of the House Judiciary's Subcommittee on Courts, the Internet, and Intellectual Property lost their reelection bids to Democrats on Tuesday, raising questions about who might fill those vacancies in the 111th Congress. Rep. Tom Feeney of Florida lost to Suzanne Kosmas, a former state legislator and small business owner. Kosmas won with 57.2 percent of the vote while Feeney received 41.1 percent. Fellow Floridian Ric Keller was defeated by Alan Grayson, an attorney who formerly ran telecommunications company IDT Corp. Grayson won 52 percent of the vote while Keller received 48 percent. In Ohio, former state legislator Steve Driehaus defeated Rep. Steve Chabot with Driehaus winning 51.5 percent of the vote and Chabot taking 48.5 percent.
The Patent and Trademark Office unveiled a blueprint Friday for work-sharing among five major intellectual property offices to address the common challenges they are currently facing. The heads of the agencies met in Jeju, Korea, Oct. 27-28 to discuss a unified vision for work sharing and collaboration.
The meeting, which was chaired Jung-Sik Koh, commissioner of the Korean IP office, was attended by PTO Director Jon Dudas; European Patent Office chief Alison Brimelow; Takashi Suzuki of the Japan Patent Office; and Tian Lipu of China's IP office. Their joint vision: “The elimination of unnecessary duplication of work among the offices, enhancement of patent examination efficiency and quality, and guarantee of the stability of patent right.”
The offices established a cooperative framework of 10 projects devised to harmonize the search and examination environment of each office and to standardize the information-sharing process. The projects are expected to facilitate the work-sharing initiative by enhancing the quality of patent searches and examinations and building mutual trust in each other’s work, PTO said. Each office will oversee two projects and agreed that by the end of April 2009, they would exchange detailed proposals on the initiatives.
The Federal Circuit Court of Appeals on Thursday upheld a decision by the Patent and Trademark Office's appeals board in a high-profile “business methods patent” dispute. At issue was PTO's rejection of an application by inventor Bernard Bilski, who tried to patent what some believe is an abstract idea to reduce risk in buying and selling commodities. The case generated immense interest in the high-tech and intellectual property communities with amicus briefs filed by the American Intellectual Property Law Association, Business Software Alliance, Computer and Communications Industry Association and a number of individual firms.
The 9-3 ruling largely rejected State Street Bank & Trust v. Signature Financial Group, a decade-old case that established a test that helped pave the way for business method patents. Chief Judge Paul Michel, who wrote the majority opinion in the Bilski case, explained that "because the applicable test to determine whether a claim is drawn to a patent-eligible process under § 101 is the machine-or-transformation test set forth by the Supreme Court and clarified herein, and Applicants' claim here plainly fails that test." Michel has repeatedly criticized State Street but court watchers were unsure of which way the wind would blow.
The case has significance far beyond whether the inventor in question ought to be granted a patent, Accenture Intellectual Property Director Wayne Sobon said earlier this year. The judges acknowledged that impact by focusing on the possible effects of "any kind of a bright-line rule on our new economy," which is largely information-driven. At an April briefing, Foley & Lardner attorney Pavan Agarwal predicted the case would be sent to the Supreme Court, regardless of who won since the justices have shown more interest in hearing patent cases in recent years. Read a more detailed analysis on the Patently-O blog.
Ten years ago Tuesday, the Digital Millennium Copyright Act was signed into law by President Bill Clinton who said in a statement at the time that the legislation carefully balanced the interests of both copyright owners and users. A decade later, some policy watchers beg to differ.
In a report released to mark the anniversary, the Electronic Frontier Foundation documents the ways in which the watchdog group believes the law has harmed "fair use" of copyrighted content, free speech, scientific research and legitimate competition. The paper focuses on the most controversial aspect of the law: its ban on "circumventing" digital rights management and other technical protection measures.
Instead of protecting against copyright infringement, the language has been used to stymie consumers, scientists, and small businesses, EFF argues. To back up its claims, the study describes many problematic episodes including a 2003 case in which Lexmark used the DMCA to block distribution of chips that allow the refilling of laser toner cartridges. Another 2006 case involved university researchers who delayed disclosure of a dangerous hidden program in some Sony CDs due to DMCA liability fears.
Continue reading Digital Millennium Copyright Act, Ten Years Later.
The top executive for a major performance rights organization said Monday that stakeholders in the digital-age copyright conversation "cannot wait until the next round of congressional hearings or rate proceedings to draft the next big idea." BMI CEO Del Bryant's remarks came at a symposium on digital media and intellectual property at the Library of Congress, which was attended by industry representatives, congressional staffers, copyright attorneys and others.
IP experts as well as technology and content creators must "chip away at the inertia" and "blend the best thinking across all minds" on the topic and find solutions that work for all parties, he said at the summit sponsored by the George Washington University Law School's Creative and Innovative Economy Center. Bryant advocated for "solutions that foster strong, progressive public policy for copyright" in the United States and across the globe. To that end, BMI helped the center launch NewCopyrightEra.org.
"Intellectual property is one of the driving forces of the economy, especially now with the financial troubles on Wall Street," noted Ralph Oman, a former U.S. Register of Copyrights who now teaches at GWU. "Performing rights organizations work. They are the most transparent and most trustworthy solution to create value for and protect the rights of songwriters, composers, and their small businesses by collecting money around the world when their songs are performed," he said.
Continue reading Music Exec: Industry Can't Wait For Congress To Act.
Public Knowledge christened a new Web site on Monday dedicated to copyright issues as they affect musicians. The site, NYMusicCopyright.org, is funded by a grant from the New York State Music Fund, which was created when the New York Attorney General's Office resolved investigations against major record labels that had violated "pay for play" activities. The fund has awarded $35 million for 400-plus grants since 2006.
According to the fund, Public Knowledge received $75,000 for the project. On the site, users will find an introduction to copyright as well as sections on music licensing, sampling, alternative methods of distribution, remedies for copyright infringement, device makers and infringement, Internet service providers and infringement, peer-to-peer technologies, digital rights management, and orphan works.
“This new site is dedicated to helping musicians understand a very complicated copyright landscape,” PK President Gigi Sohn said in a press release. “We hope musicians and those interested in the music industry will take advantage of this exciting new resource." The group also used the money to conduct several copyright workshops throughout the state.
