BILLIONS OF DOLLARS are lost each year to online piracy, which stifles the ability of writers, songwriters and others in the creative arts to earn the royalties they are due and drains profits from legitimate manufacturers. Consumers often find themselves saddled with shoddy products and no prospect of obtaining a refund.
A broad consortium of copyright and trademark holders — corporate behemoths and small enterprises alike — is pushing for legislation to help combat rogue Web sites. Many of them, based off shore and out of reach of U.S. law enforcement, leech off of the rightful owners’ goods and talents. This group is getting considerable pushback from the likes of Google and open-Internet advocates. The opponents fear that tinkering with the infrastructure of the Internet to crack down on scofflaws could do irreparable damage to the Internet’s freedom and independence.
The two forces met at an unusually raucous House hearing last month. The focal point: the House’s Stop Online Piracy Act, or SOPA. SOPA would allow the Justice Department or a copyright or trademark holder to seek a court order to block a rogue site or force financial companies such as PayPal or MasterCard to stop processing payments from U.S. customers doing business with such sites. The criticism of SOPA is warranted. It contains several provisions, including a definition of a rogue site, that are dangerously overbroad and could threaten legitimate Web sites. The Senate, which is further along in its proceedings, has offered a similar, but better thought-out and more prudent, approach.
The Senate’s Protect IP (Intellectual Property) Act is designed to target foreign Web sites that are “dedicated to” and have “no significant use” beyond copyright or trademark infringement. Defendant Web sites would have the right to contest the allegation and would be subject to further action only if a federal judge determines that the site meets the definition above. A Web site that sold a product that turned out to be counterfeit or unwittingly linked to or posted an item to which it did not have the rights would be shielded from legal action. Only the Justice Department would have the authority to seek a court order demanding that an Internet service provider block the site from U.S. consumers. Both Justice and private rights holders would be permitted to ask a judge to compel Internet advertising agencies and financial services firms to discontinue processing payments or providing services to the rogue site.
Even though Protect IP offers a more restrained approach, many open-Internet advocates worry that it still presents dangers to Internet openness and security. As lawmakers in the House and Senate work through their differences, they should continue their dialogue with stakeholders to ensure the creation of a narrowly tailored bill that preserves Internet freedom and protects legitimate businesses from being ripped off.