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Congress Ready to Weigh In After Grokster

24 Mar, 2005 By: Gary Arlen

Rep. Rick Boucher (L) and Sen. Norman Coleman

WASHINGTON — As lawyers prepare for next week's “MGM v. Grokster” oral arguments before the Supreme Court (scheduled for March 29), there are growing expectations that the digital copying dispute will move across the street to Congress later this year —no matter what the high court decides.

“I don't think it is enough to sit back and hope that the Court will get it right,” said Rep. Rick Boucher (D-Va.) during a Washington conference March 16 about “Intellectual Property and Creativity,” sponsored by the Consumer Electronics Association. Like many other speakers at the event, Boucher predicted that the losing side in the “Grokster” case will rush to Congress for new legislation — which participants agreed could take at least three to five years to enact.

Boucher is the only House member who sits on both the Judiciary and Commerce committees. Analyzing legislative procedures, he observed that Judiciary is friendlier to intellectual property holders, while Commerce is more attentive to technology issues. Within that political landscape, the tech-leaning congressman expects the side that loses in court will go to the more empathetic committee to start its legislative assault.

A Supreme Court decision is due by summer, indicating that the battle could bubble up in Congress by early autumn.

Boucher in early March introduced a bipartisan bill to deal with perceived shortcomings of the 1998 Digital Millennium Copyright Act (DCMA). The Digital Media Consumers' Rights Act (H.R. 1201), cosponsored by Reps. Joe Barton (R-Texas), who chairs the House Commerce Committee, and John Doolittle (R-Calif.), would codify the 1984 “Betamax” decision.

“Our bill seeks to restore the balance of our nation's copyright laws in ways that will promote technological innovation and consumer freedom, while … ensuring that record companies, movie studios and book producers can stop pirates from stealing,” Boucher said.

He also said his proposal would update the controversial DCMA “in ways that promote fair use without threatening intellectual property rights.” Boucher characterized the 7-year-old law as “being abused in ways never imagined by Congress.”

Another Capitol Hill keynoter at the CEA conference was equally blunt about online digital distribution and copying. “You cannot keep a lid on technology by simply filing lawsuits,” warned Sen. Norman Coleman (R-Minn.), in reference to recent music and movie industry's legal actions.

“Peer-to-peer networks are here to stay,” Coleman said. As for legislative action, he said, “My sense is that the dust has to settle in ‘Grokster’ but afterwards the legislature will be able to resolve industry differences.

Coleman, who chairs the Senate's Permanent Subcommittee on Investigations, which held hearings on digital downloading, also noted, “First, suing your customers is bad business. Second, we cannot stifle innovation; the worst thing Congress could do is put a leg iron around technology. And third, consumers need to compensate artists for their work.”

Coleman warned, “Entertainment companies must rethink their business models” to meet changing conditions.

At the conference's concluding panel discussion, Motion Picture Association of America (MPAA) president Dan Glickman acknowledged that he is ready for a Capitol Hill showdown after the Grokster decision. Glickman offered a diplomatic ultimatum.

“We're all in this together,” he said, contending that everyone supports the “desire for creators to be protected,” acknowledging both creators of content and of hardware and delivery systems. The former congressman reiterated his industry's stance that it wants “to provide content in a convenient way [and] be compensated for it.”

Another panelist, Mitch Bainwol, president of the Recording Industry Association of America of America said, “If the [Supreme] Court does the right thing, we'll see all kinds of capital flow into SnoCap, Mashboxx and other P2P networks,” referring to young companies that provide digital licensing and copyright management services.

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