Peer-to-Peer Piracy Legislation
Section-by-Section Analysis

The bill creates a new Section 514 in Title 17 of the United States Code
entitled "Remedies for Infringement: Use of Technologies to Prevent
Infringement of Copyrighted Works on Peer to Peer Computer Networks."  The=

following provides a section-by-section analysis of the newly created
Section 514.

Sec.514(a) - General Safe Harbor.

Sec.514(a) provides copyright owners with a safe harbor from liability under=

state or federal law only for actions designed to prevent the unauthorized=

distribution of their works via a publicly available, peer-to-peer (P2P)
file-trading network. The safe harbor provided by Sec.514(a) does not allow=

the removal of files or data from a P2P user's computer, the corruption of=

files or data on a P2P user's computer, or any other actions that would
impair the integrity of any computer file or data.  Sec.514(a) does not
specify the particular technologies that a copyright owner can use pursuant=

to the safe harbor.  Rather, it allows the use of any technology that
performs interdiction functions within the parameters outlined.

Sec.514(b) - Exceptions to the Safe Harbor.

Sec.514(b) further limits the safe harbor created by Sec.514(a) by listing
specific circumstances in which a copyright owner cannot rely on the safe
harbor.  The safe harbor is unavailable if:

*       abthe copyright owner impairs the trading of files that don't
contain her copyrighted work, unless such impairment is necessary to impair=

the trading of her copyrighted work (Sec.514(b)(1)(A));

*       abthe interdiction efforts of the copyright owner cause economic
loss to any person other than the file trader (Sec.514(b)(1)(B));

*       abthe impairing actions cause more than de minimis economic loss to=

the file trader, other than loss involving the copyrighted works themselves=

(Sec.514(b)(1)(C)); or

*       abthe copyright owner fails to provide the notification required by=

Sec.514(c) (Sec.514(b)(2)).

Sec.514(c) - Notification Requirement.

Before a copyright owner can avail itself of the safe harbor provided by
Sec.514(a), Sec.514(c)(1) requires that the copyright owner notify the=
 Department
of Justice of the specific technologies with which it intends to block
copyright infringements over P2P networks.  This provision essentially
enables the Department of Justice to be a watchdog over the self-help
measures employed by copyright owners.  By ensuring the Department of
Justice will be aware of all impairing technologies that copyright owners
intend to deploy, this requirement facilitates prosecution of any impairing=

actions that exceed the parameters of the safe harbor.  This provision also=

ensure that the Department of Justice will be kept abreast of the latest
developments in interdiction technologies.

Sec.514(c)(2) ensures that affected file traders and their ISPs can get all=

relevant information regarding interdiction activities.  This provision
should ensure that affected file traders do not unfairly blame ISPs for
disruptions caused by the interdiction actions of copyright owners.  At the=

request of these parties, the copyright owner must provide:

*       abthe reason for interdicting the trading of a computer file or
data containing the copyrighted work of the copyright owner,

*       abthe name and address of the copyright owner, and
*       abthe right of the affected file trader to bring the cause of
action created by Sec.514(d).

Sec.514(d) - Cause of Action.

Sec.514(d)(1) provides a new cause of action against a copyright owner who
abuses the authority provided by the safe harbor. Under this cause of
action, a file trader can seek compensation for economic loss suffered plus=

attorney's fees.

  It is important to note that, as Sec.514(f)(2) makes clear,  the new cause=

of action under Sec.514(d)(1) is in addition to the other causes of action
that may be available against a copyright owner who does not qualify for
the safe harbor.  The combination of this new cause of action and
pre-existing causes of action will deter copyright owners from using the
safe harbor as an excuse to harass file traders, indiscriminately impair
the operation of a P2P network, frustrate competitors, or otherwise take
any action not encompassed within the safe harbor.  The potential liability=

flowing from this combination of remedies  will force copyright owners to
carefully tailor their interdiction efforts to deal with infringements of
their copyrighted works.

Sec.514(d)(2) states that the new cause of action is only available as a
remedy against actions that copyright owners could not legally take but for=

the safe harbor.  Sec.514(d)(3) provides that the cause of action must be
filed within one year after the claim accrued.

Sec.514(e) - Suits by United States.

Sec.514(e) provides further assurance against abusive actions by a copyright=

holder.   If a copyright owner has a recurring history of abusive
interdiction, the United States may seek an injunction to prevent that
copyright owner from availing itself of the safe harbor in the future.  The=

possibility of such an injunction should provide a substantial disincentive=

to potential abuse by copyright owners.  Further, it ensures that the
United States government can stand in the place of affected file traders in=

the most egregious situations.

Sec.514(f) - Construction with Other Statutes.

Sec.514(f)(1) guarantees that this legislation will not be read to limit the=

ability of copyright owners to engage in interdiction efforts that would
have been legal even in the absence of the safe harbor.

Sec.514(f)(2) ensures that a copyright owner who fails to qualify for the=
 safe
harbor is subject to the full range of liability that would exist in the
absence of the safe harbor.  In other words, if the interdiction efforts of=

a copyright owner constitute a violation of a state denial-of-service
statute and do not qualify for the safe harbor, the copyright owner could
be prosecuted under that statute.

Sec.514(f)(3) ensures that interdiction efforts will not create a=
 disincentive
to utilize P2P networks for legitimate distribution of copyrighted works.

Sec.514(g) - Definitions.

Sec.514(g)(1) provides a definition of the term "economic loss," which is=
 used
in both Sec.514(b) and Sec.514(d).  By defining "economic loss" as monetary=
 costs
only, the legislation intends to include only money lost, but to exclude
any non-monetary loss such as "emotional distress."

Sec.514(g)(2) defines the term "peer-to-peer file trading network."  This
definition strictly limits the application of this safe harbor to
interdiction efforts on decentralized P2P networks. Thus, copyright owners=

cannot avail themselves of the safe harbor for interdiction efforts on P2P=

systems utilizing a client-server relationship, such as the old Napster
model.  Nor could copyright owners avail themselves of the safe harbor for=

interdiction efforts on websites, FTP sites, IM services, or IRC
channels.  The definition is structured so narrowly to ensure that the safe=

harbor is only available in circumstances in which copyright owners have no=

effective alternative to technological self-help for addressing
infringements.  While the Ninth Circuit decision in the Napster litigation=

demonstrates that a copyright owner can effectively sue to prevent
infringement on a client-server file-sharing model, there may be no central=

service to sue in a truly decentralized P2P system.

Sec.514(g)(3) defines the term "publicly accessible."  The legislation
provides a safe harbor only for interdiction efforts undertaken on publicly=

accessible P2P networks.  The legislation is limited in this way to ensure=

that the safe harbor only applies to interdiction efforts taken against
clear copyright infringements.  While the unauthorized trading of
copyrighted works on closed P2P systems might not constitute copyright
infringements in some circumstances, the unauthorized distribution of a
copyrighted work over a publicly accessible P2P system constitutes a clear=

copyright infringement.

Sec.514(g)(4) defines the term "file trader."  Under the legislation, the=
 term
"file trader" includes those who trade files or data over P2P systems, and=

the owners of the computers from which the files or data are made
accessible to the P2P system.

Sec.514(g)(5) defines the term "distribution" in the case of a computer
connected to a P2P system.  Consistent with the accepted view that
distribution of a copyrighted work is equivalent to making it publicly
available, "distribution" is defined, in the case of a computer connected
to a P2P system, as making that copyrighted work available over such a
system.

Sec.514(g)(6) defines the term "copyright owner."  The term includes both the=

owner of one of the exclusive rights in a work, and any party authorized to=

act on the owner's behalf.  This definition allows an authorized agent,
such as an interdiction company or trade association, to undertake
interdiction efforts on the owner's behalf.