FOR IMMEDIATE RELEASE: July 25, 2002 CONTACT: Gene Smith 202-225-4695 BERMAN INTRODUCES LEGISLATION TO FOIL PEER TO PEER PIRACY WASHINGTON -- U.S. Rep. Howard L. Berman (D-CA), together with Reps. Howard Coble (R-NC), Lamar Smith (R-TX), and Robert Wexler (D-FL) today introduced legislation to address copyright infringement on publicly accessible peer-to-peer (P2P) networks. "Songwriters, photographers, film producers, karaoke tape makers and other copyright owners are experiencing massive piracy of their works through P2P networks," Berman stated. "Billions of P2P downloads every month constitute copyright infringements for which these creators and owners receive no compensation. There is no excuse or justification for this piracy. Theft is theft, whether it is shoplifting a CD in a record store, or illegally downloading a song from Morpheus." "I am a big fan of P2P networks and the technology behind them," Berman continued. "I think these networks have terrific potential for all kinds of legitimate applications, including the legal distribution of copyrighted works. However, it should remain the creator's choice to distribute their works through a P2P network, not a pirate's. P2P piracy must be cleaned up, and cleaned up now." "The bill my colleagues and I introduce today will free the marketplace to develop technologies that thwart P2P piracy without impairing P2P networks themselves," Berman stated. "It will do so by allowing copyright owners, in certain limited circumstances, to use technological tools to thwart P2P piracy without fear of liability." "The law has long allowed property owners to use self-help to protect their property," Berman pointed out. "Satellite companies periodically employ electronic countermeasures to thwart the theft of their signals and programming. Software companies employ technologies that make their software inoperable if license terms are violated. However, copyright owners cannot use many promising, anti-piracy technologies because doing so runs afoul of certain common law doctrines and state and federal statutes, including the federal Computer Fraud and Abuse Act, that were never intended to apply to such self-help activities." "In other words," said Berman, "while P2P technology is free to innovate new and more efficient methods of distribution that further exacerbate the piracy problem, copyright owners are not equally free to craft technological responses. This is not fair, and today my colleagues and I introduce legislation that allows copyright owners to use technology to deal with technological piracy. "Contrary to widespread, if uninformed speculation, our legislation is narrowly crafted, with strict bounds on acceptable behavior by the copyright owner," Berman cautioned. "It gives copyright creators a very limited safe harbor from liability when they use technological tools for the narrow purpose of thwarting P2P piracy. It does not allow copyright owners to send viruses through P2P networks, destroy files, hack into the personal files of P2P users, or indiscriminately block lawful file-trading. Further, our legislation does not allow copyright owners to damage the property of any intermediaries, including ISPs, or to do more than de minimis damage to the actual P2P pirate." Berman continued, "We've been extremely careful to ensure that copyright owners have strong incentives to use self-help technologies carefully. If copyright owners stray outside the cautiously crafted confines of the safe harbor, the full range of current legal remedies are available against them. Further, if the copyright owner egregiously misuses self-help technologies, the bill gives affected file traders a new, additional cause of action, and gives federal prosecutors new ability to seek an injunction." "No legislation can eradicate the problem of peer-to-peer piracy," Berman concluded. "However, removing the unintended legal constraints on technologies that may help deal with the problem is an important part of the solution. Our legislation will help the marketplace more effectively manage P2P piracy without deterring further development of P2P's revolutionary technology." # # # Statement of the Honorable Howard L. Berman (D-CA) on Introduction of Legislation to Promote Technology Solutions to P2P Piracy Mr. Chairman: I rise today to introduce legislation that will help stop peer-to-peer piracy. The growth of peer-to-peer (P2P) networks has been staggering, even by Internet standards. From non-existence a few years ago, today nearly a dozen P2P networks have been deployed, a half-dozen have gained widespread acceptance, and one P2P network alone is responsible for 1.8 billion downloads each month. The steady growth in broadband access, which exponentially increases the speed, breadth, and usage of these P2P networks, indicates that P2P penetration and related downloading will continue to increase at a breakneck pace. Unfortunately, the primary current application of P2P networks is unbridled copyright piracy. P2P downloads today consist largely of copyrighted music, and as download speeds improve, there has been a marked increase in P2P downloads of copyrighted software, games, photographs, karaoke tapes, and movies. Books, graphic designs, newspaper articles, needlepoint designs, and architectural drawings cannot be far behind. The owners and creators of these copyrighted works have not authorized their distribution through these P2P networks, and P2P distribution of this scale does not fit into any conception of fair use. Thus, there is no question that the vast majority of P2P downloads constitute copyright infringements for which the works' creators and owners receive no compensation. The massive scale of P2P piracy and its growing breadth represents a direct threat to the livelihoods of U.S. copyright creators, including songwriters, recording artists, musicians, directors, photographers, graphic artists, journalists, novelists, and software programmers. It also threatens the survival of the industries in which these creators work, and the seamstresses, actors, Foley artists, carpenters, cameramen, administrative assistants, and sound engineers these industries employ. As these creators and their industries contribute greatly both to the cultural and economic vitality of the U.S., their livelihoods and survival must be protected. Simply put, P2P piracy must be cleaned up. The question is how. The answer appears to be a holistic approach involving a variety of components, none of which constitutes a silver bullet. Wider deployment of online services offering copyrighted works in legal, consumer-friendly ways, digital rights management technologies, lawsuits against infringers, prosecutions of egregious infringers, and technological self-help measures are all part of the solution to P2P piracy. While pursuit of many of these components to the P2P piracy solution requires no new legislation, I believe legislation is necessary to promote the usefulness of at least one such component. Specifically, enactment of the legislation I introduce today is necessary to enable responsible usage of technological self-help measures to stop copyright infringements on P2P networks. Technology companies, copyright owners, and Congress are all working to develop security standards, loosely termed digital rights management (DRM) solutions, to protect copyrighted works from unauthorized reproduction, performance, and distribution. While the development and deployment of DRM solutions should be encouraged, they do not represent a complete solution to piracy. DRM solutions will not address the copyrighted works already "in the clear" on P2P networks. Additionally, DRM solutions will never be foolproof, and as each new generation of DRM solutions is cracked, the newly-unprotected copyrighted works will leak onto P2P networks. Similarly, copyrighted works cannot always be protected by DRM solutions, as they may be stolen prior to protection or when performed in the clear - for instance, when a movie is copied from the projection booth. Shutting down all P2P systems is not a viable or desirable option for dealing with the massive copyright infringement they facilitate. While the 9th Circuit could shut Napster down because it utilized a central directory and centralized servers, the new P2P networks have increasingly engineered around that decision by incorporating varying levels of decentralization. It may be that truly decentralized P2P systems cannot be shut down, either by a court or technologically, unless the client P2P software is removed from each and every file trader's computer. As important, P2P represents an efficient method of information transfer and supports a variety of legitimate business models. Removal of all P2P networks would stifle innovation. P2P networks must be cleaned up, not cleared out. Copyright infringement lawsuits against infringing P2P users have a role to play, but are not viable or socially desirable options for addressing all P2P piracy. The costs of an all-out litigation approach would be staggering for all parties. Copyright owners would incur overwhelming litigation expenses, otherwise-innocent P2P users would undoubtedly experience privacy violations, internet service providers and other intermediaries would experience high compliance costs, and an already overcrowded federal court system would face further strain. Further, the astounding speed with which copyrighted works are spread over P2P networks, and thus their immediate ubiquity on millions of computers, renders almost totally ineffective litigation against individual P2P users. Certainly, a suit against an individual P2P user will almost never result in recovery of sufficient damages to compensate for the damage caused. In short, the costs of a litigation approach are likely to far outweigh the potential benefits. While litigation against the more egregious P2P pirates surely has a role, litigation alone should not be relied on to clean up P2P piracy. One approach that has not been adequately explored is to allow technological solutions to address technological problems. Technological innovation, as represented by the creation of P2P networks and their subsequent decentralization, has been harnessed to facilitate massive P2P piracy. It is worth exploring, therefore, whether other technological innovations could be harnessed to combat this massive P2P piracy problem. Copyright owners could, at least conceptually, employ a variety of technological tools to prevent the illegal distribution of copyrighted works over a P2P network. Using interdiction, decoys, redirection, file-blocking, spoofs, or other technological tools, technology can help prevent P2P piracy. There is nothing revolutionary about property owners using self-help -- technological or otherwise -- to secure or repossess their property. Satellite companies periodically use electronic countermeasures to stop the theft of their signals and programming. Car dealers repossess cars when the payments go unpaid. Software companies employ a variety of technologies to make software non-functional if license terms are violated. However, in the context of P2P networks, technological self-help measures may not be legal due to a variety of state and federal statutes, including the Computer Fraud and Abuse Act of 1986. In other words, while P2P technology is free to innovate new, more efficient methods of P2P distribution that further exacerbate the piracy problem, copyright owners are not equally free to craft technological responses to P2P piracy. Through the legislation I introduce today, Congress can free copyright creators and owners to develop technological tools to protect themselves against P2P piracy. The proposed legislation creates a safe harbor from liability so that copyright owners may use technological means to prevent the unauthorized distribution of that owner=s copyrighted works via a P2P network. This legislation is narrowly crafted, with strict bounds on acceptable behavior by the copyright owner. For instance, the legislation would not allow a copyright owner to plant a virus on a P2P user's computer, or otherwise remove, corrupt, or alter any files or data on the P2P user's computer. The legislation provides a variety of remedies if the self-help measures taken by a copyright owner exceed the limits of the safe harbor. If such actions would have been illegal in the absence of the safe harbor, the copyright owner remains subject to the full range of liability that existed under prior law. If a copyright owner has engaged in abusive interdiction activities, an affected P2P user can file suit for economic costs and attorney's fees under a new cause of action. Finally, the U.S. Attorney General can seek an injunction prohibiting a copyright owner from utilizing the safe harbor if there is a pattern of abusive interdiction activities. This legislation does not impact in any way a person who is making a fair use of a copyrighted work, or who is otherwise using, storing, and copying copyrighted works in a lawful fashion. Because its scope is limited to unauthorized distribution, display, performance or reproduction of copyrighted works on publicly accessible P2P systems, the legislation only authorizes self-help measures taken to deal with clear copyright infringements. Thus, the legislation does not authorize any interdiction actions to stop fair or authorized uses of copyrighted works on decentralized, peer-to-peer systems, or any interdiction of public domain works. Further, the legislation doesn't even authorize self-help measures taken to address copyright infringements outside of the decentralized, P2P environment. This proposed legislation has a neutral, if not positive, net effect on privacy rights. First, a P2P user does not have an expectation of privacy in computer files that she makes publicly accessible through a P2P file-sharing network - just as a person who places an advertisement in a newspaper cannot expect to keep that information confidential. It is important to emphasize that a P2P user must first actively decide to make a copyrighted work available to the world, or to send a worldwide request for a file, before any P2P interdiction would be countenanced by the legislation. Most importantly, unlike in a copyright infringement lawsuit, interdiction technologies do not require the copyright owner to know who is infringing the copyright. Interdiction technologies only require that the copyright owner know where the file is located or between which computers a transmission is occurring. No legislation can eradicate the problem of peer-to-peer piracy. However, enabling copyright creators to take action to prevent an infringing file from being shared via P2P is an important first step toward a solution. Through this legislation, Congress can help the marketplace more effectively manage the problems associated with P2P file trading without interfering with the system itself. I yield back the balance of my time.