September 28, 2004

An open letter in opposition to the INDUCE Act

Author: Reader submission

To all:

Below is a letter being circulated for signatures by OSAIA and others in
opposition to S. 2560, commonly known as the INDUCE Act. It is difficult to
overstate the need for swift action against this bill. We therefore ask you
to add your name to this letter.

As you likely know, S. 2560 would create a new legal standard known as
"inducement of copyright infringement." This new theory, in effect, would
hold liable anyone whose product or service, in the view or a "reasonable
person," could be expected to be used to make illegal copies. If passed,
INDUCE will almost surely lead to regulation of software, PCs, VCRs,
general-purpose optical drives and countless other hardware and software
products. Under this bill, ISPs would likely be forced to police their
networks for infringement. Indeed, it is fair to say that the entire
Internet could be open to redesign in court. Digital rights management
technologies, as controversial and difficult to implement as they are,
would almost certainly become mandatory. Small innovators, faced with the
legal hurdles in from of them, would likely cease innovating.

In short, S. 2560 would give Hollywood and the record companies a direct
voice in how IT is done in this country. Not reaching agreement with the
content industry before introducing a new product or service would, in our
view, invite litigation on a massive scale. This bill, in our view, will
force jobs and revenue out of the US, yet do nothing to stop actual
infringement today. It is, unfortunately, on the verge of passing a major
committee. S. 2560 will likely pass the Senate quickly unless Senate
leadership hears from us immediately.

A copy of the latest discussion version of the measure is included below.

Given the weight that signatures by individual companies carry, we urge you
to join the list of signatories below by close of business Tuesday Sept.
28. The presence of individual companies willing to oppose this measure
will add significantly to the impact of the letter.

Please call me at ext. 105 or Dan Johnson at ext. 106 if you have further
questions about the letter.

Best regards,

Will Rodger
Director, Public Policy
CCIA/Open Source and Industry Alliance

+1 202 783 0070 x-105

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September 27, 2004

The Honorable Bill Frist, Majority Leader, U.S. Senate
The Honorable Tom Daschle, Minority Leader, U.S. Senate
Washington, DC 20510

The Honorable Orrin G. Hatch, Chairman
The Honorable Patrick J. Leahy, Ranking Member
Committee on the Judiciary
U.S. Senate
Washington, DC 20510

cc: Members of the Committee on the Judiciary

Dear Senators Frist, Daschle, Hatch, and Leahy:

The undersigned companies and organizations write to express our amplified
concerns over both the process and the substance pertaining to what we
understand to be the current draft of "inducement" legislation. Although a
fourth good-faith attempt, this version appears no closer to meeting what
we understood to be S. 2560's original objectives:

(1) to differentiate
between objectionable and legitimate conduct;
(2) to preserve the essence
of the Betamax holding; and
(3) to avoid an unmanageable flood of
litigation that would tie up innovators and chill investment.

The new draft, like the original S. 2560, relies on a vague and
indeterminate "totality of circumstances" standard of intent. Like the
first Copyright Office draft, it predicates liability on undefined
"affirmative acts" but, unlike that draft, is not limited to the
"dissemination" of works. Rather, the draft is addressed to the very
introduction of products and services into commerce, and equates
"inducement" with the foreseeability of any significant infringement, no
matter how positive the potential economic and social contribution of the
product or service may be. This extends well beyond any concept that the
Copyright Act or the Supreme Court has yet embraced; it would effectively
expand copyright monopolies and, correspondingly, devalue patent
grants. It thus implies a fundamental realignment of our intellectual
property system.

The draft contains a number of apparent exceptions, but all are easily
avoided by a plaintiff who divides his allegations into a number of
separate "acts." The "affirmative acts" creating liability under the bill
could simply be the (1) design and (2) making available of a multiuse
product. In sum, there seems no clear rationale by which it can be
interpreted as applying only to the bad actors cited by Senator Hatch, upon
introduction of S. 2560, and not to legitimate businesses, individuals, and
institutions.

The standard for potential liability action one could "expect to result
in widespread violations" is entirely novel in the copyright law, and
seems considerably easier for a plaintiff to satisfy than that of the
Betamax case or even the standard suggested in the dissent in the Betamax
case. It would seem to subject all who invest, manufacture, or "traffic"
in legitimate home, personal recording, and Internet products to a new and
unquantifiable risk of litigation. There seems a substantial likelihood
that staple hardware and software products that are considered legal today
would be found illegal tomorrow. Moreover, the provision mentioning the
Betamax holding explicitly invites judges to "evolve" its doctrine a
concept that met with universal dismay when advanced on July 22 by the
Register of Copyrights.

That these vulnerabilities and uncertainties remain, even though the
drafters have recognized and attempted to address many of our concerns,
underscores the fact that adding any new cause of action to the Copyright
Act is a daunting undertaking that requires carefully nuanced drafting to
prevent adverse impacts on the many sectors of the economy that copyright
law reaches. The present "induce" attempt, like those previous, requires
reflection and comment, via hearings, so that the many new terms and
concepts may be discussed and vetted publicly. We hope you will respect
our concern, as entities participating constructively in this process, that
the present draft is not ready for passage out of the Judiciary Committee.

Respectfully submitted,


Association of American Universities
American Association of Law Libraries
American Library Association
Association of Research Libraries California
ISP Association
Computer & Communications Industry Association Consumer Electronics
Association Digital Future Coalition
Electronic Frontier Foundation
Electronic Industries Alliance (EIA)
Home Recording Rights Coalition
Information Technology Association of America (ITAA)

Institute of Electrical and Electronics Engineers (USA)
Matsushita Electronics Corp. of America
MCI National Venture Capital Association
NetCoalition
Open Source and
Industry Alliance
Public Knowledge
Radio Shack
Samsung Electronics America
Sun Microsystems, Inc.
Telecommunications Industry Association
Uniden America Corp.
U.S. Public Policy Committee of the Association for Computing
Machinery
Verizon

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