Proposed Statutory Amendments by the DMCA Revision Committee

Below is an outline of our group's proposed amendments to section 512 of the copyright act. For each section, we state the proposed changes to the statute and explain those changes, and then we include "legislative history" in the form of a semi-fictitious summary of our discussions concerning each proposed modification.

Section I. Proposals and the legislative history for the inclusion of filtering technology:

Proposed Language:
(a) A service provider shall take good faith reasonable steps to police and prevent copyright infringement by users through its service.
(b) Paragraph (a) does not apply to the following services of a service provider.
(1) intermediate and transient storage; or
(2) providing links to, indexing of, or directories of online locations for the purposes of information location.

Introduction:

As the current DMCA doesn’t require online service providers (“OSPs”) to police themselves, it is not fair for the copyright holders to have the sole duty to police all of their copyrighted works, especially since, in the digital era, many mediums like the Internet facilitate the massive distribution of copyrighted works. The OSPs, who gain a benefit from their users, do have the right and ability to control infringing activity on their servers. Therefore, we propose to impose part of the burden of policing copyright infringing conducts through the service provided by the OSPs.

Part (a):

We provide broad language in part (a) to allow a more flexible and nimble application to various types of OSPs for now and in the future. Nowadays, technology that filters and blocks the unauthorized distribution or posting of copyrighted works over an OSP, but allows distribution or posting of public domain materials or, where authorized by the copyright holders or the Copyright Act, is available for OSPs to incorporate within their services. Moreover, we also consider the Supreme Court Decision in Grokster (125 S.Ct. 2761 (2005)); the court pointed out that the effort to filter copyrighted materials could be a prima facie showing of non-inducement. Therefore, we believe that filtering technology would be one of the possible solutions to the problem of protecting the interests of the copyrights holders without stifling the development of technological innovation.

However, we decline to insert a requirement for specific filtering technology into the DMCA. First, it may require an excessive amount of money to access and manage certain kinds of filtering technology. In view of the different capabilities to access filtering technology among various types of OSPs, for instance, the large, medium, and small OSPs; profit and non-profit OSPs, it would cause problems to the small, medium or non-profit OSPs who have insufficient resources to create or adopt all technologies. Second, the necessity of adopting filtering technology also depends on the size and type of these OSPs. For example, to small OSPs having only a small number of users and traffic, it would be sufficient to use human power to police instead of a very high technology of filtering.

Last but not least, in consideration of the fair use materials protected under the First Amendment of Constitution, to incorporate the filtering technology mandate into the DMCA is likely to wipe out these materials and stifle the free speech incentive because it is still not likely to use filtering technology to distinguish copyright infringing material from fair use ones so far.

Part (b):

We exclude services providing intermediate and transient storage and information-locating from the policing requirement for the following reasons. First, for “mere conduit” and “information-locating” kinds of service, it is too burdensome for OSPs to monitor immense materials transmitted through the conduit. Second, for “mere conduit” kinds of service, as to the undertaking to police, it would inevitably violate privacy of users, which should be a serious concern.

Legislative History:

Ethan: In order to balance the burden to monitor copyright infringement, should we adopt a “filtering technology” mandate into the DMCA? It is a very important factor to determine the contributory infringement in the Grokster case.

Sirimas: I agree with the importance of filtering technology that would balance the duty of the copyright holders and the OSPs. However, if we include the filtering technology mandate into the DMCA, it would be too burdensome to the small OSPs without sufficient resources to adopt the technology. And the fair use materials protected under the First Amendment would be deeply undermined in the future.

Ethan: Yes. But what should we do? We need to take some steps to balance the burden because the Internet is worsening the level of copyright infringement at both incredible speed and amounts. It is unfair to only impose on the copyright holder the duty to police copyright infringement under the current DMCA.

Sirimas: Why don’t we use a flexible term to regulate the burden to OSPs in the DMCA and let the court decide discretionally if the technology or step that the OSPs adopt is sufficient.

Ethan: I agree. And we should also consider whether a filtering requirement should apply to intermediate and transient storage and information location. It would be unnecessarily burdensome to the OSPs providing “mere conduit” and information locating services to monitor immense materials transmitted through the conduit. And it would inevitably violate the privacy right of users while OSPs providing “mere conduit” services undertaking the police.

Sirimas: Yes, you are right. So our conclusion in this issue is that a service provider should take reasonable steps to prevent copyright infringement, and the burden should be precluded for mere conduit and information-locating services.


Section II. Proposals and the legislative history a redefinition of “service provider”:

Proposed Definition:

The new proposed definition for a service provider is as follows:

A service provider is an entity which acts as a conduit for transmission or routing of data to or from a user to one or more specified points at the direction of the user, without modification to the sent or received material other than automatic modification necessary for the mere performance of the service, and performs one or more of the following actions:
providing online services or network access;
acting as an intermediate, transient, temporary, or permanent data storage;
providing links to, indexing of, or directories of online locations for the purposes of information location.

The current DMCA definition of “service provider” occurs in two parts, and it is inadequate to cover the full range of possible entities that may be considered to be service providers. Hence, we propose the above single definition which contains multiple characteristics that a service provider may contain. We believe that this definition provides broad coverage for entities that are currently considered to be service providers that are worthy of protection. Moreover, this definition is broad enough to cover new kinds of service providers as they develop.

The first part of the definition is written to include all service providers since the basic function for service providers is to act as a conduit for sending and receiving data. Unlike the current definition contained in the DMCA, this new proposed definition recognizes that some modification of data by service providers will occur under circumstances which should not expose the service provider to liability. Such modification may be automatic and necessary for the service. For example, data transmitted through a network may need to be compressed or encrypted. Or, a service that allows material to be posted may need to convert that material into an acceptable format. These kinds of modifications, which are not at the selective direction of the service provider, will be allowed under the proposed definition.

Part (a) is a broad category that includes entities that provide access to the Internet as well as entities that provide access to other kinds of networks. Such entities may universities, cable or DSL companies, or entities allowing access to networks not directly connected to the Internet. Other included service providers might be entities that allow the exchange of email or instant messages.

Part (b) covers virtually every service provider in some form. For every service provider, a copy of infringing material will necessarily exist on the service provider’s network at least in a transient manner. Other service providers, including discussion boards, file sharing servers, or sites allowing users to post video or audio clips, will provide more permanent storage of possibly infringing materials. Hence, this section will capture a wide variety of service providers.

Part (c) covers service providers which help users find and navigate to online information. This definition covers directories that may contain links to other pages and items as well as search engines.

Although we do not address a revision of the service provider categories at this time, this definition is a first step towards the elimination of the service provider categories. The current categories needlessly separate the different possible functions of a service provider. It is possible that these five categories could be collapsed into a single statement specifying under what conditions a service provider will be liable for copyright infringement. However, such an extensive modification must be reserved for another occasion.


Legislative History:

Harry: Don't you think that the structure of § 512 of DMCA is too complicated to easily understand?

Ryan: I agree with you. I think that one major flaw in DMCA is an inadequate handling of the term "service provider." DMCA defines "service provider" near the end of § 512 at (k) in two different ways. "Service providers" are then broken into five categories by provisions (a) through (e). I think that this convoluted verbiage is not only confusing but also fails to account for emerging technologies.

Harry: I think we should redefine the "service provider" in a single simpler and more robust way. Then, in the future it would be easier to collapse the five categories into a single statement specifying under what conditions a service provider will not be liable for copyright infringement.

Ryan: Yes, right. By the way, I think that another problem with the current definition for the "service provider" contained in DMCA is that it requires no modification to the content of the material to qualify for the liability exemption of the service provider. But, such modification may be automatic and necessary for the service.

Harry: I agree. The data transmitted through a network may need to be compressed or encrypted. Or, a service that allows material to be posted may need to convert that material into an acceptable format. We should explicitly state that such modification necessary for the service does not affect the liability exemption.

Ryan: Should we clarify some ambiguous descriptions such as "financial benefit directly attributable to the infringing activity" and "expeditiously"?

Harry: Yes, right. As for "expeditiously," I think we might consider clarifying this to specific terms such as "within 36 hours." As for "financial benefit directly attributable to the infringing activity," I think we can consider deleting the entire condition relating to this.

Ryan: I agree with you regarding the direct financial benefit term, but let’s leave “expeditiously” as it is since what is or isn’t expeditious could change dramatically depending on the type of work and service provider.


Section III. Proposal to amendment to the current “notice and take-down” procedure:

Proposed Revisions:

The current “notice and take-down” procedure is ineffective because users can repost infringing works as soon as they are removed. Copyright owners, thus, have the burden to give new notice any time that an infringing work is reposted. We believe that an OSP has sufficient information to remove or disable online access to infringing works from the first notification of the copyright owners. Therefore, we propose to make it obligation of an OSP to monitor its website to prevent such reposting. This can be done by adding the following phrase as Subsection (c)(1)(D) of Section 512:

“…; and (D) take reasonable steps to prevent the subscribers from reposting the same infringing materials after being removed according to (c)(1)(C).

We propose that a similar phrase should be added as Subsection (d)(1)(c)(4) of Section 512:

“…; and (4) take reasonable steps to prevent subscribers from reposting the same infringing materials after being removed according to (c)(1)(C).”

We believe this amendment will make the procedure more efficient.

Legislative History:

Pricilla: Shouldn’t we make the proposed Subsection broader to cover the same infringing materials posted by not only the same subscriber but by any other subscribers? That will help copyright owners from sending new notifications for the same infringing materials.

Piyawat: I see you point. However, that will cause problems in practice. For example, the same material that is posted by another subscriber may not be deemed infringing. Another person may have permission to post such material. Moreover, another person may be entitled to claim fair use.

Proposal to add “reversed notice and take-down procedure” to Section 512:

It is a known fact that not every clip that is posted by users on YouTube website is copyright infringing work. A number of them are works created by those users. Some were posted with consent, whether implicitly or explicitly, of creators. Some works, even though made and posted without authorization of copyright owners, are fair use of copyrighted works. Accordingly, users are authorized by law to post these types of works, and copyright owners are not entitled to request that an OSP remove or disable online access to such materials.

It seems that the available procedure works well for all parties. In fact, there are chances that fair use materials are taken down inappropriately by notice from copyright owners who do not appreciate, whether in good or bad faith, that such materials are fair use. Even though users are entitled to file a counter notification with the OSP asking for replacement of the removed or disabled materials, this procedure can only take place after the materials have been removed or their online access have been disabled. We, therefore, propose to amend the DMCA to add another procedure which entitles users to prevent their fair use materials from being removed unreasonably and may also solve the conflict between copyright owners and the OSP’s users.

Under the proposed procedure, either before or after posting a video clip on the OSP’s website, a user who believe his/her material is fair use or who would like to try to get permission to post a copyrighted content on a website from the copyright owner (as, for example, those who believe posting a music video of a particular song will help promoting sales of CDs of such song) is entitled to send a request to the copyright owner via OSP asking for clearance or permission to post the material. The copyright owner is, thus, obligated to revert to the user via OSP within 10 days with an answer whether to give such clearance or permission. Failure to revert to the OSP by the prescribed time is deemed to be an implied clearance or permission, as the case may be, to post the material. After receiving the request, copyright owner may negotiate terms and conditions of the permission (license) with the user directly. OSP must be informed of such negotiation.

If the copyright owner decides not to grant license to the user and advises the OSP of such decision by the due date, the OSP must promptly notify the user. The OSP must then block the user from posting such material or, if the material has already been posted, remove such material or disable access to the material. The OSP must then take necessary steps to prevent the subscribers from reposting the materials after being removed.

If the copyright owner decides not to give the requested clearance and advises the OSP of such decision by the due date, the OSP is obligated to forward the case to the DMCA Commission, a government agency established to handle this matter, for consideration and decision. The Commission must render decision within 10 days. If the Commission finds the material to be fair use, it must notify all parties promptly. The OSP must then allow the material to be posted. If the Commission finds, to the contrary, that the material is not fair use, it must notify all concerned parties promptly. The OSP must then block the user from posting such material or, if the material has already been posted, remove such material or disable access to the material. OSP must then take necessary steps to prevent subscribers from reposting the materials after being removed.

The parties who disagree with the Commission’s decision is then entitled to appeal the decision to the court. If the material has been posted as per the Commission’s decision, it can be taken down only by court injunction, whether preliminary or permanently. The copyright owner is not entitled to initiate the “notice and take-down procedure” while the “reversed notice and take-down procedure” is pending.

Legislative history:

Pricilla: Do we need to create a DMCA Commission to solve disputes between users and copyright owners? It is not an easy task to create a new government agency.

Piyawat: Without such agency, all disputes will have to be settled in courts. The very high litigation costs will dissuade poor users and independent artists from defending their rights in courts. It is very likely that they will give in.

Ryan: I’m against both the proposed reverse take down procedure and the DMCA administrative agency proposal for two reasons. First, the creation of a new agency is a complex and expensive act that should be reserved only for the circumstances where current legal avenues are inadequate to address an important need. Deciding what constitutes copyright infringement or fair use has always been the jurisdiction of the courts, and I’m not at all convinced that there is a need for this to change. I don’t think that the ability of users to post fair use materials is such a pressing public policy concern that a new agency is required. Secondly, copyright infringement and claims of fair use occur every day, both in digital and analog contexts, and it’s not clear to me why a DMCA commission for digital contexts should be favored over an agency covering all copyright disputes.

Piyawat: In making this proposal, I thought of the DOJ's Antitrust Division and FTC in antitrust disputes. These administrative agencies not only taking action against violators of antitrust law but also provide other services to try to solve and prevent problems. For Example, a company or a group of firms is entitled to request for a Business Review Letter from the DOJ's Antitrust Division on their planed business plans. This is to get the officials to review and comment whether their plans would be deemed anti competitive under antitrust law. Based on this model, I thought it should be good to all parties concerned in DMCA case to have a similar administrative agency to take care of initial disputes. It would be more cost and time effective.