[Congressional Record: May 14, 1998 (Senate)]
[Page S4884-S4900]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
[DOCID:cr14my98-136]


                DIGITAL MILLENNIUM COPYRIGHT ACT OF 1998

  Mr. LOTT. Mr. President, I ask the Senate turn to Calendar No. 358,
S. 2037, regarding the WIPO treaty, which is the treaty dealing with
digital copyright.
  The PRESIDING OFFICER. Under the previous order, the clerk will
report.
  The assistant legislative clerk read as follows:

       A bill (S. 2037) to amend title 17, United States Code, to
     implement the WIPO Copyright Treaty and the WIPO Performances
     and Phonograms Treaty, to provide limitations on copyright
     liability relating to material online, and for other
     purposes.

  The Senate proceeded to consider the bill.
  Mr. LOTT. Mr. President, the Senate is now considering the WIPO
Copyright Treaty which has up to 1 hour under the consent agreement
that was reached on May 12. Therefore, the next vote will occur
shortly--hopefully in less than an hour--on passage of the WIPO
copyright bill, and that will be the last vote of the day.
  I know there are some Senators here who have worked on this issue who
do want to be heard briefly--the Senator from Missouri, and, of course,
the Senator from Utah has been working on this assiduously. We had a
little problem we ran into yesterday, but we are going forward with
this and we will try to work it out with the House, and I will
certainly try to be helpful with that.
  This is important legislation. A lot of effort has been put into it.
Some of the problems have been resolved, thanks to the courtesy and
leadership of Senator Hatch, working with Senator Ashcroft. So I think
we need to go ahead and do it today and we will have had, really, an
incredible week on these high-tech bills.

  Again, the next vote will occur on Monday--there will be no further
votes after the WIPO vote tonight--and I will notify all Members as to
the time of that vote.
  With regard to the DOD authorization matter, I will be talking with
the managers of this legislation to see what their wishes are, and we
will have some further announcements of when that legislation will be
brought up again.
  I yield the floor.
  The PRESIDING OFFICER. Under the previous order, the time allocated
for this debate is 60 minutes, equally divided and controlled between
the Senator from Utah, Mr. Hatch, and the Senator from Vermont, Mr.
Leahy, with 15 minutes of the time of Mr. Hatch controlled by the
Senator from Missouri, Mr. Ashcroft.
  The Senate will be in order.
  Mr. ASHCROFT. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. HATCH. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HATCH. I would like to yield to the distinguished Senator from
Arizona for an amendment that he has to take care of.
  Mr. McCAIN. Mr. President, I ask unanimous consent to send to the
desk an amendment that is on the DOD bill.
  The PRESIDING OFFICER. The Presiding Officer will advise the Senator
the DOD bill is not the pending business.
  Mr. McCAIN. Can I, by unanimous consent, send up that amendment?
  Mr. LEVIN. I object. Reserving the right to object.
  Mr. McCAIN. It is an amendment that has been accepted by both sides.
  Mr. LEVIN. On the DOD bill? I have to object. There are too many
pending amendments. I am sorry, if the Senator can clear that----
  The PRESIDING OFFICER. Objection is heard. The Senator from Utah.
  Mr. HATCH. Mr. President, I ask this time not be charged.
  The PRESIDING OFFICER. The amendments are submitted and will be
numbered. The Senator from Utah.
  Mr. HATCH. I ask that time not be charged to the present act.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HATCH. Mr. President, I rise to speak in support of the Digital
Millennium Copyright Act of 1998, S. 2037. The DMCA is the most
comprehensive bill that has come before the Senate regarding the
Internet and the digital world in general.
  The DMCA in Title I implements the World Intellectual Property (WIPO)
treaties on copyright and on performers and phonograms, and in Title II
limits the copyright infringement liability of on-line and Internet
service providers (OSPs and ISPs) under certain circumstances. The DMCA
also provides in Title III a minor but important clarification of
copyright law that the lawful owner or lessee of a computer may
authorize someone to turn on their computer for the purposes of
maintenance or repair. Title IV addresses the issues of ephemeral
recordings, distance education, and digital preservation for libraries
and archives.
  Due to the ease with which digital works can be copied and
distributed worldwide virtually instantaneously, copyright owners will
hesitate to make their works readily available on the Internet without
reasonable assurance that they will be protected against massive
piracy. Legislation implementing the treaties provides this protection
and creates the legal platform for launching the global digital on-line
marketplace for copyrighted works. It will facilitate making available
quickly and conveniently via the Internet the movies, music, software,
and literary works that are the fruit of American creative genius. It
will also encourage the continued growth of the existing off-line
global marketplace for copyrighted works in digital format by setting
strong international copyright standards.
  The copyright industries are one of America's largest and fastest
growing economic assets. According to International Intellectual
Property Alliance statistics, in 1996 (when the last full set of
figures was available), the U.S. creative industries accounted for
3.65% of the U.S. gross domestic product (GDP)--$278.4 billion. In the
last 20 years in which comprehensive statistics are available--1977-
1996--the U.S. copyright industries' share of GDP grew more than twice
as fast as the remainder of the economy--5.5 percent versus 2.6
percent.
  Between 1997 and 1996, employment in the U.S. copyright industries
more than doubled to 3.5 million workers--2.8 percent of total U.S.
employment. Between 1977 and 1996 U.S. copyright industry employment
grew nearly three times as fast as the annual rate of the economy as a
whole--4.6 percent versus 1.6 percent. In fact, the copyright
industries contribute more to the U.S. economy and employ more workers
than any single manufacturing sector, including chemicals, industrial
equipment, electronics, food processing, textiles and apparel, and
aircraft.
  More significantly for the WIPO treaties, in 1996 U.S. copyright
industries achieved foreign sales and exports of $60.18 billion, for
the first time leading all major industry sectors, including
agriculture, automobiles and auto parts, and the aircraft industry.
There can be no doubt that copyright is of supreme importance to the
American economy. Yet, American companies are losing $18 to $20 billion
annually due to the international piracy of copyrighted works.
  But the potential of the Internet, both as information highway and
marketplace, depends on its speed and capacity. Without clarification
of their liability, service providers may hesitate to make the
necessary investment to fulfill that potential. In the ordinary course
of their operations service providers must engage in all kinds of acts
that expose them to potential copyright infringement liability.
  For example, service providers must make innumerable electronic
copies in order simply to transmit information over the Internet.
Certain electronic copies are made to speed up the delivery of
information to users. Other electronic copies are made in order to host
World Wide Web sites. Many service providers engage in directing users
to sites in response to inquiries by users or they volunteer sites that
users may find attractive. Some of these sites might contain infringing
material. In

[[Page S4885]]

short, by limiting the liability of service providers, the DMCA ensures
that the efficiency of the Internet will continue to improve and that
the variety and quality of services on the Internet will continue to
expand.
  Besides the major copyright owners and the major OPSs and ISPs (e.g.,
the local telephone companies, the long distance carriers, America
OnLine, etc.), the Committee heard from representatives of individual
copyright owners and small ISPs, from representatives of libraries,
archives and educational institutions, from representatives of
broadcasters, computer hardware manufacturers, and consumers--and this
is not an exhaustive list.
  Title II, for example, reflects 3 months of negotiations between the
major copyright owners and the major OSPs, and ISPs, which I encouraged
and in which I participated, and which took place with the assistance
of Senator Ashcroft. Intense discussions took place on distance
education too, with the participation of representatives of libraries,
teachers, and educational institutions, and with the assistance of
Senator Leahy, Senator Ashcroft, and the Copyright Office.
  As a result, the Committee took substantial steps to refine the
discussion draft that I laid down before the Committee through a series
of amendments, each of which was adopted unanimously. For example, the
current legislation contains:
  (1) a provision to ensure that parents will be able to protect their
children from pornography and other inappropriate material on the
Internet;
  (2) provisions to provide for the updating of the copyright laws so
that educators, libraries, and achieves will be able to take full
advantage of the promise of digital technology;
  (3) important procedural protections for individual Internet users to
ensure that they will not be mistakenly denied access to the World Wide
Web;
  (4) provisions to ensure that the current practice of legitimate
reverse engineering for software interoperability may continue; and
  (5) provisions to accommodate the needs of broadcasters for ephemeral
recordings and regarding copyright management information.
  These provisions are in addition to provisions I had already
incorporated into my discussion draft, such as provisions on library
browsing, provisions addressing the special needs of individual
creators regarding copyright management information, and provisions
exempting nonprofit archives, nonprofit educational institutions, and
nonprofit libraries from criminal penalties and, in the case of civil
penalties, remitting damages entirely when such an institution was not
aware and had no reason to believe that its acts constituted a
violation.
  Consequently, the DMCA enjoys widespread support from the motion
picture, recording, software, and publishing industries, as well as the
telephone companies, long distance carriers, and other OSPs and ISPs.
It is also supported by the Information Technology Industry Council,
which includes the leading computer hardware manufacturers, and by
representatives of individual creators, such as the Writers Guild, the
Directors Guild, the Screen Actors Guild, and the American Federation
of Television and Radio Artists. The breadth of support for S. 2037 is
reflected in the unanimous roll call vote (18-0) by which the DMCA was
reported out of Committee.
  Mr. President, the United States started the Internet, and remains
its most significant hub. No country comes close to the United States
in creative output. In these areas, we are the undisputed leaders. This
bill will help us maintain this edge in an increasingly competitive
global market.
  Mr. President, I urge my colleagues in the Senate to vote favorably
for S. 2037. This bill has such important ramifications for the
continued prosperity of the U.S. as we enter the next millennium and
has such powerful support that it should be enacted immediately.
  Finally, I would like to particularly pay tribute to the ranking
member of the Senate Judiciary Committee, Senator Leahy. I don't know
of anyone who has more interest in the Internet, more interest in
computers, more interest in copyright matters than Senator Leahy,
unless it is myself, and I don't think I have more. He has done a great
job on this committee. It is a pleasure to work with him.
  It has been a wonderful experience throughout the 22 years I have
been on the committee to work with him on technical and difficult
issues. I personally thank him before everybody today for his good
work. Without his help, we wouldn't be this far, and we all know it. I
thank him. I would also like to thank Manus Cooney, Edward Damich, Troy
Dow, and Virginia Isaacson of my staff for their long hours of hard
work on this issue. And I want to commend the hard work and cooperation
I received from Bruce Cohen, Beryl Howell, and Marla Grossman of
Senator Leahy's staff, and Paul Clement, and Bartlett Cleland of
Senator Ashcroft's staff.

                           Amendment No. 2411

                (Purpose: To make technical corrections)

  Mr. HATCH. Mr. President, I send an amendment to the desk and ask for
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Utah [Mr. Hatch] proposes an amendment
     numbered 2411.

  The amendment is as follows:

       On page 12, line 15 strike subsection (c) and redesignate
     the succeeding subsections and references thereto
     accordingly.
       On page 17, line 4, insert ``and with the intent to induce,
     enable, facilitate or conceal infringement'' after
     ``knowingly''
       On page 17, beginning on line 8, strike ``, with the intent
     to induce, enable, facilitate or conceal infringement''
       On page 17, beginning on line 21, strike paragraph (3) and
     insert in lieu thereof the following:
       ``(3) distribute, import for distribution, or publicly
     perform works, copies of works, or phonorecords, knowing that
     copyright management information has been removed or altered
     without authority of the copyright owner or the law,

     knowing, or, with respect to civil remedies under section
     1203, having reasonable grounds to know, that it will induce,
     enable, facilitate or conceal an infringement of any right
     under this title.''.
       On page 19, line 4, insert the following new paragraph and
     redesignate the succeeding paragraphs accordingly:
       ``(6) terms and conditions for use of the work;''.
       On page 19, line 4, strike ``of'' and insert in lieu
     thereof ``or''.

  Mr. HATCH. This is a technical amendment, and I urge its adoption.
  The PRESIDING OFFICER. If there is no objection, the amendment is
agreed to.
  The amendment (No. 2411) was agreed to.
  Mr. HATCH. I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I thank my friend from Utah for his
gracious comments, and I do appreciate working with him on this matter.
He and I have discussed this so many times in walking back and forth to
votes and in the committee room, and so on. I think the Senator from
Utah and I long ago determined that if we were going to have this WIPO
implementing bill passed, its best chance would be one where the
Senator from Utah and the Senator from Vermont were basically holding
hands on it.
  The Senator from Utah may recall a time once when the then-Senator
from Nevada, Senator Laxalt, and I were here and we had two pieces of
legislation, a Laxalt-Leahy bill and a Leahy-Laxalt bill. One of our
colleagues said, ``This is either a very good bill or one of you didn't
read.''
  In this case, the Hatch-Leahy-et al. piece of legislation is a very
good bill, and one which the two of us have read every word. We have
tried to make very clear to the Senate that the issues we are raising
in this bill are not partisan issues. These are issues that create jobs
in the United States. These are issues that allow the United States to
go into the next century with our innovative genius in place. These are
issues that allow the United States, in creating that innovative
genius, to continue to lead the world. Senators, in voting for this
legislation, will be voting to maintain the intellectual leadership of
the United States.
  The successful adoption by the World Intellectual Property
Organization, what we call WIPO, in December 1996, of two new copyright
treaties--one on written material and one on sound recordings--was
praised in the United States. The bill that we have before us today,
the DMCA, the Digital Millennium Copyright Act, will effectuate the

[[Page S4886]]

purposes of those treaties in the United States and, I believe, will
serve as a model for the rest of the world.
  The WIPO treaties will fortify intellectual property rights around
the world. They will help unleash the full potential of America's most
creative industries, including the movie, recording, computer software,
and other copyrighted industries that are subject to online and other
forms of piracy, especially in the digital age where it is easier to
pirate and steal exact copies of works.
  If they don't have the protection, the owners of intellectual
property are going to be unwilling to put their material online. If
there is no content worth reading online, then the growth and
usefulness of the Internet will be stifled and public accessibility
will be retarded.
  Secretary Daley of the Department of Commerce said, for the most
part, ``The treaties largely incorporate intellectual property norms
that are already part of U.S. law.'' What the treaties will do is give
American owners of copyrighted material an important tool to protect
their intellectual property in those countries that become a party to
the treaties.
  With ever-expanding electronic commerce, trafficking the global
superhighway, international copyright standards are critical to
protecting American firms and American jobs. The future growth of the
Internet and of digital media requires rigorous international
intellectual property protections.
  I have in my hand the 1998 Report on Copyright Industries in the
United States Economy. This was released last week by the International
Intellectual Property Alliance.
  This report shows conclusively just how important the U.S. copyright
industries are to American jobs and how important it is to protect that
U.S. copyright industry from global piracy.
  If you look at the chart over here, Mr. President, it shows that from
the years 1977 to 1996, the U.S. copyright industries' share of the
gross national product grew more than twice as fast as the rest of the
economy.
  These are the core copyright industries. Look how fast they grew as
compared to the rest of the U.S. economy.
  One of the things that has expanded and fueled our expanding economy
is the copyright industry.
  Now, during those same 20 years, job growth in the core copyright
industries was nearly three times as fast as the rest of the economy.
What this shows us, Mr. President, is that we are undergoing
unprecedented expansion of our economy, but this is the area expanding
the fastest.
  These statistics underscore why, when the President transmitted the
two WIPO treaties and draft legislation to implement the treaties to
the U.S. Senate, I was proud to introduce the implementing legislation,
S. 1121, with Senators Hatch, Thompson, and Kohl. We did it the same
day. The legislation we have before us today is the result of years of
work domestically and internationally to ensure that the appropriate
copyright protections are in place around the world to foster the
growth of the Internet and other digital media and networks.
  The Clinton administration showed great foresight when it formed, in
1993, the Information Infrastructure Task Force, IITF, which
established a Working Group on Intellectual Property Rights to examine
and recommend changes to keep copyright law current with new
technology. Then they released a report in 1995 explaining the
importance of this effort, stating:

       The full potential of the NII will not be realized if the
     education, information and entertainment products protected
     by intellectual property laws are not protected. . .

  The report said further:

       All the computers, telephones, fax machines, scanners,
     cameras, keyboards, televisions, monitors, printers,
     switches, routers, wires, cables, networks, and satellites in
     the world will not create a successful NII, if there is no
     content. What will drive the NII is the content moving
     through it.

  The same year that report was issued, Senator Hatch and I joined
together to introduce the NII Copyright Protection Act of 1995, S.
1284, which incorporated the recommendations of the Administration.
That legislative proposal confronted fundamental questions about the
role of copyright in the next century--many of which are echoed by the
DMCA, which we consider today.
  Title I of the DMCA is based on the Administration's recommendations
for legislation to implement the two WIPO treaties. It makes certain
technical changes to conform our copyright laws to the treaties and
substantive amendments to comply with two new treaty obligations.
  Specifically, the treaties oblige the signatories to provide legal
protections against circumvention of technological measures used by
copyright owners to protect their works, and against violations of the
integrity of copyright management information (CMI). Such information
is used to identify a work, its author, the copyright owner and any
information about the terms and conditions of use of the work. The bill
adds a new chapter to U.S. copyright law to implement the anticircum-
vention and CMI provisions, along with corresponding civil and criminal
penalties.
  Title II of the DMCA limits the liability for copyright infringement,
under certain conditions, for Internet and online service providers.
Title III gives a Copyright Act exemption to lawful computer owners or
lessees so that independent technicians may service the machines
without infringement liability.
  Title IV begins a process of updating our Nation's copyright laws
with respect to library archives, and educational uses of copyrighted
works in the digital age.
  Title I is based on the administration's recommendations, as I said.
  Following intensive discussions with a number of interested parties,
including libraries, universities, small businesses, ISPs and OSPs,
telephone companies, computer users, broadcasters, content providers,
and device manufacturers, we in the Senate Judiciary Committee were
able to reach unanimous agreement.
  For example, significant provisions were added to the bill in Title
II to clarify the liability for copyright infringement of online and
Internet service providers. The bill provides ``safe harbors'' from
liability under clearly defined circumstances, which both encourage
responsible behavior and protect important intellectual property
rights. In addition, during the committee's consideration of this bill,
an Ashcroft-Leahy-Hatch amendment was adopted to ensure that computer
users are given reasonable notice when their Web sites are the subject
of infringement complaints, and to provide procedures for computer
users to have material that is mistakenly taken down put back online.
  We have a number of provisions designed to help libraries and
archives. First, libraries expressed concerns about the possibility of
criminal sanctions or potentially ruinous monetary liability for
actions taken in good faith. This bill makes sure that libraries acting
in good faith can never be subject to fines or civil damages.
Specifically, a library is exempt from monetary liability in a civil
suit if it was not aware and had no reason to believe that its acts
constituted a violation. In addition, libraries are completely exempt
from the criminal provisions.
  We have a ``browsing'' exception for libraries so they can look at
encrypted work and decide whether or not they want to purchase it for
their library.
  Senator Hatch, Senator Ashcroft, and I crafted an amendment to
provide for the preservation of digital works by qualified libraries
and archives. The ability of libraries to preserve legible copies of
works in digital form is one I consider critical. Under present law,
libraries are permitted to make a single facsimile copy for their
collections for preservation purposes, or to replace copies in case of
fire and so on. That worked back in the nondigital age. It does not
work today. This gives us a chance to be up to date. We would allow
libraries to transfer a work from one digital format to another if the
equipment needed to read the earlier format becomes unavailable
commercially.
  The bill ensures that libraries' collections will continue to be
available to future generations by permitting libraries to make up to
three copies in any format--including in digital form. This was one of
the proposals in The National Information Infrastructure (NII)
Copyright Protection Act of 1995, which I sponsored with Senator Hatch
in the last Congress. The Register of Copyrights, among others, has
supported that proposal.
  These provisions go a long way toward meeting the concerns that
libraries have expressed about the original

[[Page S4887]]

implementing legislation we introduced.
  We address distance learning. When Congress enacted the present
copyright law it recognized the potential of broadcast and cable
technology to supplement classroom teaching, and to bring the classroom
to those who, because of their disabilities or other special
circumstances, are unable to attend classes. At the same time, Congress
also recognized the potential for unauthorized transmissions of works
to harm the markets for educational uses of copyrighted materials. The
present Copyright Act strikes a careful balance and includes a narrowly
crafted exemption.
  As with so many areas of copyright law, the advent of digital
technology requires us to take another look at the issue.
  I recognize that the issue of distance learning has been under
consideration for the past several years by the Conference on Fair Use
(CONFU) that was established by the Administration to consider how to
protect fair use in the digital environment. In spite of the hard work
of the participants, CONFU has so far been unable to forge a
comprehensive agreement on guidelines for the application of fair use
to digital distance learning.
  We made tremendous strides in the Committee to chart the appropriate
course for updating the Copyright Act to permit the use of copyrighted
works in valid distance learning activities.
  Senator Hatch, Senator Ashcroft, and I joined together to ask the
Copyright Office to facilitate discussions among interested library and
educational groups and content providers with a view toward making
recommendations for us to consider with this legislation. We
incorporated into the DMCA a new section 122 requiring the Copyright
Office to make broader recommendations to Congress on digital distance
education within six months. Upon receiving the Copyright Office's
recommendations, it is my hope that the Senate Judiciary Committee will
promptly commence hearings on the issue and move expeditiously to enact
further legislation on the matter. I know that all members on this
Committee are as anxious as I am to complete the process that we
started in Committee of updating the Copyright Act to permit the
appropriate use of copyrighted works in valid distance learning
activities. This step should be viewed as a beginning--and we are
committed to making more progress as quickly as possible.
  We have also asked the Copyright Office to examine, in a
comprehensive fashion, when the actions of a university's employees
might jeopardize the university's eligibility for the safe harbors set
out in the bill for online service providers. This is an important and
complex issue with implications for other online service providers,
including libraries and archives, and I look forward to reviewing the
Copyright Office's analysis of this issue.
  Amendments sponsored by Senator Ashcroft, Senator Hatch, and I were
crafted to address the question of reverse engineering, ephemeral
recordings, and to clarify the use of copyright management.
  Finally, to assuage the concerns of the consumer, electronics
manufacturers, and others, that the bill might require them to design
their products to respond to a particular technological protection
measure, Senator Hatch, Senator Ashcroft, and I crafted an amendment to
clarify the bill on this issue.
  I mention all of these things, Mr. President, because it shows why
the administration has sent a Statement of Administration policy saying
the Administration supports passage of this bill. This is a well-
balanced package of proposals. As we go into the next century--the
creators, the consumers, those in commerce in this country need the
best laws possible. The United States is the leader today. The United
States will not be the leader tomorrow without adequate laws.
  These laws allow the United States to continue to be the electronic
and intellectual property leader of the world. We should pass this
bill. We can pass it with pride.
  I would like to close by praising the dedicated staff members from
the Judiciary Committee who have assisted us in crafting this
legislation. They appreciate the significance of this legislation for
our country and its economy. In particular, I want to thank Edward
Damich and Troy Dow from the Chairman's staff, and Paul Clement and
Bartlett Cleland from Senator Ashcroft's staff, for demonstrating what
can be done when we put political party allegiances aside and strive to
work together in a bipartisan fashion to craft the best bill possible.
My hope is that the bipartisan manner in which they worked on behalf of
the Chairman and Senator Ashcroft to bridge differences rather than
exacerbate them can be replicated on a number of other important
issues pending in our Committee.

  I would also like to thank those people on my Judiciary Committee
staff--Bruce Cohen, Beryl Howell, Marla Grossman, Bill Bright and Mike
Carrasco--for their work on this bill. They each put in long hours to
help me find solutions to the concerns of a number of stakeholders in
this bill. I could always trust their counsel to be fair and
conscientious.
  Mr. President, I reserve the remainder of my time.
  Mr. HATCH. Mr. President, let me just praise my colleague from
Missouri. Senator Ashcroft has been committed and has worked very, very
hard to make this bill one that all of us can support. He has done a
terrific job. He has worked on this OSP liability thing with us ad
infinitum and added matters to this bill that made this a much better
bill and strengthened the bill. I just could not feel better about
somebody on my committee working on this bill than I do toward Senator
Ashcroft. I just wanted to say he played a significant role in this
legislation. I personally thank him.
  I yield the floor.
  Mr. ASHCROFT addressed the Chair.
  The PRESIDING OFFICER. Under the previous order, the Senator from
Missouri is recognized to speak for 15 minutes.
  Mr. ASHCROFT. Thank you, Mr. President.
  I am grateful for the kind remarks of the Senator from Utah and am
pleased to have the opportunity to work with him and the Senator from
Vermont.
  I rise today to speak in favor of one of the most important pieces of
technology legislation in the 105th Congress. At its heart, this
legislation is about updating the copyright laws for the digital age
and preparing a sizable portion of our economy for the next century.
  The affected parties include the online service providers, computer
hardware and software manufacturers; every educator in America is
affected by this legislation; every student; all the libraries; all the
consumer electronics manufacturers and consumers of electronics; the
motion picture companies, and everyone who uses the Internet. This
measure will have as broad an impact on the American public as
virtually any measure we will address.
  The full Senate's consideration of this bill culminates an effort of
updating our copyright law that I began last September when I
introduced S. 1146, the Digital Copyright Clarification and Technology
Education Act. S. 1146 was a comprehensive bill designed to jump-start
a process that had ground to a halt and appeared to be going nowhere.
  The bill addresses three basic problems. First, the liability of
online service providers for copyright violations; second, the need to
update the provisions of the copyright law that affect educators and
libraries for the digital age; and third--and not least, of course--the
need to implement the World Intellectual Property Organization, or
WIPO, treaties.
  The United States of America, as the generator of so much content and
material--the innovator, the creator of so much of what is
copywritten--stands to gain most by making sure that our copyrights are
respected worldwide.
  I am gratified that today the full Senate will vote on this bill that
addresses all three of these concerns, especially the concerns
regarding the need to implement the World Intellectual Property
Organization treaties which will provide that the United States effort
to protect copyrights--the intellectual property of those who are the
creators in this country and develop things in this country--those
treaties will protect those copyrights.
  The original administration language that was introduced by Senators
Hatch and Leahy focused exclusively on the

[[Page S4888]]

WIPO treaties. However, through hard work, numerous amendments and the
assistance of Senators Hatch and Leahy and their staffs--and this was
really a cooperative effort--we were able to fashion a comprehensive
approach to updating the copyright laws for the digital age.
  Many important changes were made to the bill, including amendments
reinforcing on-line privacy rights, ensuring that the bill would not be
read to mandate design decisions and addressing the need to update the
copyright laws to permit distance education using digital technology.
  When I was a professor--I won't want to admit how long ago--I used to
teach a television course. The very same procedures I used in analog
technology for television transmission might well have been illegal if
the TV signal had been transmitted digitally. It is important that we
give the capacity for distance education in the digital age the same
potential that we had for distance education in the analog age.
  I will focus on three important changes, one reflecting each of the
three basic problems addressed by the original bill.
  First, there is the issue of the liability of on-line service
providers. The notion that service providers should not bear the
responsibility for copyright infringements when they are solely
transmitting the material is one key to the future growth of the
Internet. Now, what we are really talking about is if someone illegally
transmits material on the Internet, the Internet companies that provide
the opportunity for people to transmit the material shouldn't be held
responsible any more than the phone company should be held responsible
if you were to say something illegal over the phone, or that Xerox
should be held responsible if you violate a copyright by illegally
copying material on the Xerox machine.
  This is very important because of the way the Internet operates in
terms of assembling and reassembling digital messages that they not be
considered to be an illegal publisher; they, therefore, needed the
protections that are provided in this bill so that we can have and
continue to use the infrastructure of the Internet and allow it to
operate effectively.
  Proper resolution of this issue is critical to unlock the potential
for the Internet. For that reason, I included a title addressing on-
line service provider liability in my legislation. Make no mistake
about it, clarification of on-line service provider liability was one
of my fundamental concerns in the debate, and after months of
negotiations the affected parties were able to agree to legislative
language that protects on-line service providers, or what we call the
OSPs, from liability when they simply transmit--they are not involved,
they don't have any interest in the message, but they are just
transmitters. If there is a violation, it is not their fault that
something was transmitted in contravention of the copyright law.
  Although I applauded the efforts of the affected industries to
resolve the OSP liability issue, there was one issue which the industry
agreement did not address--the protections that need to be given to
users of the Internet. The agreement that the OSPs entered into would
have protected the interests of the copyright owners, but it provided
little or no protection for an Internet user who was wrongfully accused
of violating copyright laws.
  I think of a little girl, perhaps, who puts on her Internet site the
picture of a duck she draws. We shouldn't allow Disney to say, ``We own
Donald Duck. That looks too much like Donald,'' and be able to bully a
little girl from having a duck on her web site. We needed protection
for the small user, not just for the big content promoters.
  Even though several Judiciary Committee members claimed no amendments
were needed, I made sure that the industry compromise respected the
rights of typical Internet users, ordinary people, by offering an
amendment that provided a protection included in the original bill I
had offered. It is an idea which is referred to as the ``notice and
put-back'' provision. If material is wrongfully taken down from the
Internet user's home page, my amendment ensures that the end user will
be given notice of the action taken and gives them a right to initiate
a process that allows them to put their material back on line without
the need to hire a lawyer or go to court. This was a critical
improvement over the industry's prior compromise agreement.

  A second concern of mine throughout this process has been the need to
update protections for educators and libraries already included in the
copyright law to reflect the digital technology. I have already
mentioned that. Having been an individual who had the privilege of
teaching a college course on television I knew just how important it
would be for libraries and educational institutions to be able to use
digital transmissions of documents and signals in the same way that
they were authorized to do so with analog signals under our copyright
law as it has existed.
  I did offer an amendment in committee, and it was unanimously
incorporated into the bill, which will allow libraries to use digital
technology for archiving and for interlibrary loans, for example. This
will help libraries serve the American public.
  A final issue of profound importance, ensuring that the bill did not
inadvertently make it a violation of the Federal law to be a good
parent. The original bill or draft of this bill took such a broad
approach to outlawing any devices that could be used to gain access to
a copyrighted work that it may have made it illegal to manufacture and
use devices that were designed to protect children from obscenities and
pornography. An amendment I offered in committee makes it clear that a
parent may protect his children from pornography without running afoul
of this law. I think moms and dads will want to be able to protect
their children and shouldn't have to risk running afoul of the law to
do so. My own belief is that when moms and dads do their jobs,
governing America will be easy. If moms and dads don't do their jobs,
governing this country could be impossible. We need to make it possible
for parents in every instance to do their job.
  The amendment recognizes that devices designed to allow such parental
monitoring must be allowed. We should never allow any legislation to
move forward that intentionally or unintentionally makes good parenting
illegal. When the choice is between protecting our children from
obscene material and perhaps allowing one machine to be diverted for
unlawful use, Congress and the court should choose the protection of
the children every time and then prosecute anyone who makes unlawful
use of such machine.
  There are a number of individuals who deserve our specific thanks
here, and I want to take the time to make sure that deserving
individuals and organizations are thanked. I want to take a moment to
thank a few particular staff members who labored into the night over
and over again and through weekends to put together this legislation. I
commend my colleagues Senators Hatch and Leahy. I want to say that a
number of my concerns were accommodated because these members of the
Leahy and Hatch staff were so hard-working. Ed Damich and Troy Dow with
Senator Hatch were critical to moving forward on all issues,
particularly by coordinating the OSP discussions.
  Beryl Howell and Marla Grossman of Senator Leahy's staff were
similarly important to the process, particularly in regard to the
education provisions and on drafting language for several key areas. I
thank the staff. They worked very closely with two of the best staff
members that I think work in any arena on Capitol Hill, and that is
Bartlett Cleland of my staff and Paul Clement. They worked extremely
hard with industry and with other Members of the Senate to craft a
piece of legislation which I believe is going to be a tremendous asset
in allowing the potential of the Internet to be realized.
  Finally, I want to thank all of the individuals representing various
industry and education interests who were critical not only in
educating me on the myriad of technical issues addressed in this
legislation, but were helping in every way to reach agreement when the
time came. In the end, this is perhaps not a perfect bill. I would have
favored a different approach to some issues. But this is a bill that
has become a comprehensive effort to bring the copyright law into the
digital age. It is an important piece of legislation which we can work
together to make work for America.

[[Page S4889]]

  Accordingly, I am happy to support this bill. I look forward to its
final passage, with appreciation to the outstanding leadership of
Senator Hatch and Senator Leahy in the committee. Working with them has
been one of the most gratifying experiences of a process of reaching a
conclusion on legislation which I think will advance our opportunity
significantly to access the advantages of electronic and digital
communication for the entirety of America.
  Mr. President, I want to go over some of these notions again and
expand the ideas a bit further.
  I rise today to speak in favor of one of the most important pieces of
technology legislation in the 105th congress. At its heart, this
legislation is about updating the copyright laws for the digital age
and preparing a sizable portion of our economy for the next century.
The affected parties include the on-line service providers, computer
hardware and software manufacturers, educators students, libraries,
consumer electronics manufacturers and consumers, motion picture
companies, and everyone who uses the Internet. The full Senate's
consideration of this bill culminates an effort at updating our
copyright law that I began last September when I introduced S. 1146,
the Digital Copyright Clarification and Technology Education Act. S.
1146 was a comprehensive bill designed to jump start a process that had
ground to a halt and appeared to be going nowhere. The bill addressed
three basic problems: (1) the liability of on-line service providers
for copyright violations, (2) the need to update the provisions of the
copyright law that affect educators and libraries for the digital age,
and (3) the need to implement the World Intellectual Property
Organization, or WIPO, treaties. I am gratified that today the full
Senate will vote on a bill that addresses all three of these concerns.
  The original Administration language that was introduced by Senators
Hatch and Leahy focused exclusively on the WIPO Treaties. However,
through hard work, numerous amendments, and the assistance of Senators
Hatch and Leahy and their staffs, we were able to fashion a
comprehensive approach to updating the copyright laws for the digital
age.
  The bill before the Senate today now addresses all three of the basic
problems identified in my bill. First, the notion that service
providers should not bear the responsibility for copyright
infringements when they are providing a means of communication is a key
notion for the future growth and development of digital communications
and most importantly the Internet. Resolution of this issue is critical
for the future development of the Internet. For that reason, I included
a title regarding on-line service provider liability in my legislation.
After months of negotiations, the affected parties were able to agree
to legislative language that protects on-line service providers, or
OSPs, from liability when they simply transmit information along the
Internet.
  The principles expressed in this legislation will provide a clear
path for OSPs to operate without concern for legal ramifications or
copyright infringement that may occur in the regular course of the
operation of the Internet, or that occur without the OSPs knowledge.
Without these issues being clearly delineated we would have faced a
future of uncertainty regarding the growth of Internet and potentially
whether it could have operated at all. Make no mistake that the
clarification of on-line service provider liability was one of my
fundamental concerns in this debate. While this was not the only
crucial change in the legislation it is a change that I found essential
for this legislation to even be considered, which is why Title I of my
original legislation was devoted to clearly defining liability.
  Although I was supportive of the affected industries' efforts to
resolve the OSP liability issues, there was one issue which the
industry agreement did not address--what protections would be given the
typical users of the Internet. The agreement protected the interests of
OSPs, and it protected the interests of copyright owners, but it
provided little or no protection for an Internet user wrongfully
accused of violating the copyright laws.
  The original draft would have left these wrongly injured, innocent
users with limited recourse. They would have to hire an attorney and go
to court to have the court require the OSP and copyright holder to
allow the web page to go back up--in other words the end user would
have to go to court to prove their innocence. I found this situation to
be totally unacceptable. Even though several Judiciary Committee
members claimed that no amendments were needed I made sure that the
industry compromise protected the rights of the typical Internet user
by offering an amendment that provided protection included my original
bill--an idea referred to as notice and put back. If material is
wrongly taken down from an Internet user's home page because the
original notice mistakenly did not take into account that the Internet
user was only making a fair use of the copyrighted work, my amendment
ensures that the end-user will be given notice of the action taken, and
gives them a right to initiate a process that allows them to put their
material back on-line, without the need to hire a lawyer and go to
court. This was a critical improvement over the industry's compromise
agreement.
  Another modification to the OSP liability material was to guarantee
that companies, such as Yahoo!, could continue to operate as they have
previous to the passage of this legislation. I admire companies that
can succeed in the highly competitive technology sector, and Yahoo! has
done just that. In no way should Congress discourage true
entrepreneurship, particularly when the better ``mouse trap'' in this
case has propelled a company to the top of its market. The safe harbor
should not dissipate merely because a service provider viewed a
particular online location during the course of categorization for a
directory. If the rule were otherwise, true consumer oriented products
would be eliminated or discouraged in the marketplace.
  Finally, I also insisted on language in the Committee role that
recognized that the OSP liability provisions must be applied to
educators and libraries with sensitivity to the special nature of those
institutions and the unique relationships that exist in those settings.
The report also makes it clear that the notice and put-back provision I
mentioned above provides all the process that is due, so that state
institutions need not worry about having to choose between qualifying
for the safe harbors provided in the bill and the requirements imposed
by the Due Process Clause.
  The second title of my original legislation was dedicated to similar
concerns of universities, libraries, schools, educators and students,
and ensured that these groups would not be left out when the content
providers rushed to secure their position in the digital age. This
legislation now includes some of the same provisions. I worked closely
with Senator Leahy, educators, libraries and publishers to guarantee
that libraries will be able to update their archives and provide
materials to the public in a way that keeps pace with technology.

  Additionally, this legislation begins the process to allow distance
education in the digital world. We should not tolerate laws that
discriminate against technology, instead we should seek to guarantee
that what people can do in the analog that they can continue those
actions in the digital world. A study will be undertaken to help
Congress to sort out the many technological and legal challenges of
updating the copyright law regarding distance education. At the
beginning of the next Congress I fully expect to introduce legislation
specifically on distance education and I understand that both Senators
Hatch and Leahy have agreed to support legislation based on the study
conducted by the Copyright Office. In addition, I look forward to
working with both the education community and the content community to
pass, not block, this important legislation. Distance education is of
fundamental importance to Missouri, as it is to most rural states, and
of great importance to the many parents who home school their children.
  A third portion of the bill addresses the means by which the WIPO
treaties will be implemented in the United States, also referred to as
section 1201. This issue is of fundamental importance for a vital part
of our nations

[[Page S4890]]

economy. Piracy is a large and growing problem for many content
providers, but particularly to our software industry. Billions of
dollars in pirated material is lost every year and in impact is felt
directly to our national bottom line.
  While the overall structure of the legislation in this part is not
the way I would have approached the issue I believe that I have been
given enough assurance both in legislative language and in legislative
history that I can support the bill. I still find troubling any
approach that makes technology the focus of illegality rather than the
bad conduct of a bad actor, but with the accommodations that have been
given I think that the bill is workable.
  One issue of profound importance to me was ensuring that parents
continue to have the legal ability to be good parents. The original
draft of this bill took such a broad approach to outlawing devices,
that it may have inadvertently made it illegal to manufacture and use
devices designed to protect children from on-line pornography. The
bill, as amended recognizes that certain devices--such as devices that
allow parents to protect their children from on-line pornography--must
be allowed. An amendment I offered in Committee makes clear that a
parent may protect their children from pornography without running
afoul of this law. We should never be in the position with any
legislation that intentionally or unintentionally makes good parenting
illegal. When the choice is between protecting our children from
obscene material and perhaps allowing one machine to be diverted for
unlawful use, Congress and the courts should choose the protection of
children every time.
  Additionally, the protection of privacy remains a concern. While the
legislation makes some effort to make clear that a person acting to
protect their individual privacy should not be liable for or guilty of
circumvention some further clarification is needed. One of my primary
concerns has been the use of ``cookies'' and their detrimental impact
for on-line privacy. I am not convinced that cookies could not be
copyrighted and protected in such a way that getting rid of them or
turning them off would not violate the new law. Recently my concern has
been proven further by a piece of software developed by Blizzard
Entertainment called StarCraft. This software rifles through the
player's hard drives and sends the information found back to the
company. Again, I was told by some that I should not be concerned, but
I will tell you that I am concerned and everyone in this body and in
the country should have similar concerns about this or any legislation
that without careful thought could create a situation where an
individual's privacy is jeopardized. I believe the savings clause I
added to the bill will address this problem. However, if that does not
prove sufficient, I will introduce legislation to deal with this
problem directly and will look forward to working with all the parties
that support this bill to ensure passage of such legislation.
  One industry that has concerns about this legislation is the
encryption industry. I sought to have included in the legislative
language a provision to guarantee that the highly successful means for
encryption research that are used in this country may continue to be
used in the future, despite some of the prohibitions included in this
bill. Unfortunately, we were not able to work out any acceptable
legislative language. We were able to craft language for the report
that made clear that most forms of current encryption research were
left undisturbed by the bill. While I believe that this is better than
nothing, I understand that there are lingering concerns, and I would
certainly support efforts to try to address this issue before the House
completes work on this important piece of legislation.
  In discussing the anti-circumvention portion of the legislation, I
think it is worth emphasizing that I could agree to support the bill's
approach of outlawing certain devices because I was repeatedly assured
that the device prohibitions in 1201(a)(2) and 1201(b) are aimed at so-
called ``black boxes'' and not at legitimate consumer electronics and
computer products that have substantial non-infringing uses. I
specifically worked for and achieved changes to the bill to make sure
that no court would misinterpret this bill as outlawing legitimate
consumer electronics devices or computer hardware. As a result, neither
section 1201(a)(2) nor section 1201(b) should be read as outlawing any
device with substantial non-infringing uses, as per the tests provided
in those sections.
  If history is a guide, however, someone may yet try to use this bill
as a basis for initiating litigation to stop legitimate new products
from coming to market. By proposing the addition of section 1201(d)(2)
and (3), I have sought to make clear that any such effort to use the
courts to block the introduction of new technology should be bound to
fail.
  As my colleagues may recall, this wouldn't be the first time someone
has tried to stop the advance of new technology. In the mid 1970s, for
example, a lawsuit was filed in an effort to block the introduction of
the Betamax video recorder. I think it useful to recall what the
Supreme Court had to say in ruling for consumers and against two movie
studies in that case:

       One may search the Copyright Act in vain for any sign that
     the elected representatives of the millions of people who
     watch television every day have made it unlawful to copy a
     program for later viewing at home, or have enacted a flat
     prohibition against the sale of machines that make such
     copying possible.

  As Missouri's Attorney General, I had the privilege to file a brief
in the Supreme Court in support of the right of consumers to buy that
first generation of VCRs. I want to make it clear that I did not come
to Washington to vote for a bill that could be used to ban the next
generation of recording equipment. I want to reassure consumers that
nothing in the bill should be read to make it unlawful to produce and
use the next generation of computers or VCRs or whatever future device
will render one or the other of these familiar devices obsolete.
  Another important amendment was added that makes clear that this law
does not mandate any particular selection of components for the design
of any technology. I was concerned that this legislation could be
interpreted as a mandate on product manufacturers to design products so
as to respond affirmatively to effective technical protection measures
available in the marketplace. In response to this concern I was pleased
to offer an amendment, with the support of both the Chairman and the
Ranking Member of the Committee, to avoid the unintended effect of
having design requirements imposed on product and component
manufacturers, which would have a dampening effect on innovation, and
on the research and development of new products. Accordingly, my
amendment clarified that product designers need not design consumer
electronics, telecommunications, or computing products, nor design and
select parts or components for such products, in order to respond to
particular technological protection measures.
  This amendment reflects my belief that product manufacturers should
remain free to design and produce consumer electronics,
telecommunications and computing products without the threat of
incurring liability for their design decisions under this legislation.
Nothing could cause greater disaster and a swifter downfall of our
vibrant technology sector than to have the federal government dictating
the design of computer chips or mother boards. By way of example,
during the course of our deliberations, we were made aware of certain
video boards used in personal computers in order to allow consumers to
receive television signals on their computer monitors which, in order
to transform the television signal from a TV signal to one capable of
display on a computer monitor, remove attributes of the original signal
that may be associated with certain copy control technologies. I am
acutely aware of this particular example because I have one of these
video boards on my own computer back in my office. It is quite useful
as it allows me to monitor the Senate floor, and occasionally ESPN on
those rare occasions when the Senate is not in session. My amendment
makes it clear that this legislation does not require that such
transformations, which are part of the normal conversion process rather
than affirmative attempts to remove or circumvent copy control
technologies, fall within the proscriptions of chapter

[[Page S4891]]

12 of the copyright law as added by this bill.
  Further, concerns were voiced during the Committee's deliberations
that because 1201 applies not only to devices but to parts and
components of devices, it could be interpreted broadly to sweep in
legitimate products such as personal computers and accessories and
video and audio recording devices. While the manufacturers of these
products were understandably concerned, it was quite apparent to me
that it was not the Committee's intention that such useful multipurpose
articles of commerce be prohibited by 1201 on the basis that they may
have particular parts or components that might, if evaluated separately
from such products, fall within the proscriptions of 1201(a)(2) or (b).
My amendment adding sections 1201(d)(2) and (3) was intended to address
these concerns.
  Another issue of concern is that unless product designers are
adequately consulted on the design and implementation of technological
protection measures and means of preserving copyright management
information, such measures may have noticeable and recurring adverse
effects on the authorized display or performance of works. Under such
circumstances, certain adjustments to specific products may become
necessary after sale to a consumer to maintain the normal, authorized
functioning of such products. Such adjustments, when made solely to
mitigate the adverse effects of the measure on the normal, authorized
operation of a manufacturer's product, device, component, or part
thereof, would not, in my view, constitute conduct that would fall
within the proscriptions of this legislation.
  The problems described may occur at a more fundamental level--with
noticeable and recurring adverse effects on the normal operation of
products that are being manufactured and sold to consumers. The best
way to avoid this problem is for companies and industries to work
together to seek to avoid such problems to the maximum extent possible.
I am pleased to note that multi-industry efforts to develop copy
control technologies that are both effective and avoid such noticeable
and recurring adverse effects have been underway over the past two
years in relation to certain copy protection measures. I join my
colleagues in strongly encouraging the continuation of these efforts,
since, in my view, they offer substantial benefits to copyright owners
who add so much to the economy and who obviously want devices that do
not interfere with the other normal operations of affected products.
  The truth of the matter is that Congress ought to operate
contemporaneously with industry to solve problems. Anytime the affected
industries beat government to the solution they ought to be praised. In
many respects I invite the private sector to be there first and get it
done well. If they are there first, they will often solve the problem.
Even when they cannot solve the problem, the private sector problem
solving process will at least narrow the issues for the government to
address. Getting a law passed is very difficult, getting it changed is
sometimes even more difficult, and so relying on government really
elevates the need to have no garbage in, to result in the right output.
  I would encourage the content community and the device and hardware
manufacturers to work together to avoid situations in which effective
technological measures and copyright management information affect
display quality. There is no reason why the interested parties cannot
resolve these issues to ensure both optimal protection of content and
optimal picture quality. To the extent that a particular technological
protection measure or means of applying or embedding copyright
management information to or in a work is designed and deployed into
the marketplace without adequate consultation with potentially affected
manufacturers, the proprietor of such a measure or means and those
copyright owners using it must be aware that product adjustments by a
manufacturer to avoid noticeable and recurring adverse effects on the
normal, authorized operation of affected products are foreseeable,
legitimate and commercially necessary. Such actions by manufacturers
may not, therefore, be proscribed by this chapter.
  Again, several individuals and organizations deserve thanks from
everyone involved in this debate. I want to take a moment to thank
those few particular staff who labored into the night and over weekends
to put together this legislation and to accommodate some of my
concerns. Ed Damich and Troy Dow with Senator Hatch's office were
critical to moving forward on all issues particularly by coordinating
the OSP discussions. Beryl Howell and Marla Grossman were similarly
important to the process particularly in regards to the education
provisions and on drafting language for several key areas. I would like
to thank all of the individuals representing various industry and
educational interests who were critical not only in educating me on the
myriad issues but also on copyright law in general. Finally, I would
again like to thank the members of my own staff, Bartlett Cleland and
Paul Clement who worked so well to produce a piece of legislation that
could guide this country to a digital future.
  In the end, this is not a perfect bill. I would have favored a
different approach to some issues. However, this bill is an important
step forward in bringing the copyright law into the digital age. I am
happy to support this bill and look forward to its final passage.
  Mr. KOHL. Mr. President, I rise to express my support for the Digital
Millennium Copyright Act of 1998. In my view, we need this measure to
stop an epidemic of illegal copying of protected works--such as movies,
books, musical recordings, and software. The copyright industry is one
of our most thriving businesses. But we still lose more than $15
billion each year due to foreign copyright piracy, according to some
estimates.
  This foreign piracy is out of control. For example, one of my
staffers investigating video piracy on a trip to China walked into a
Hong Kong arcade and bought three bootlegged computer games--including
``Toy Story'' and ``NBA `97''--for just $10. These games normally sell
for about $100. Indeed, the manager was so brazen about it, he even
agreed to give a receipt.
  Illegal copying has been a longstanding concern to me. I introduced
one of the precursors to this bill, the Motion Picture Anti-Piracy Act,
which in principle has been incorporated into this measure. And I was
one of the original cosponsors of the original proposed WIPO
implementing legislation, the preliminary version of this measure.
  In my opinion, this bill achieves a fair balance by taking steps to
effectively deter piracy, while still allowing fair use of protected
materials. It is the product of intensive negotiations between all of
the interested parties--including the copyright industry, telephone
companies, libraries, universities and device manufacturers. And every
major concern raised during that process was addressed. For these
reasons, it earned the unanimous support of the Judiciary Committee.
  I am confident that this bill has the best approach for stopping
piracy and strengthening one of our biggest export industries. It
deserves our support. Thank you.
  Mr. GRASSLEY. Mr. President, I wanted to make a few brief remarks on
S. 2037, the Digital Millennium Copyright Act of 1998, which would
implement the World Intellectual Property Organization treaties. The
amendments adopted in Committee make some significant improvements to
the original bill. For example, the bill now includes provisions
clarifying educational institution and library liability and use
exemptions, as well as provisions dealing with distance learning. The
Committee also adopted provisions addressing concerns regarding
pornography and privacy. Further, I worked with Senator Kyl to make
sure that our law enforcement and intelligence people are able to carry
out their duties in the best, and most effective, manner possible.
  It was important to me that the bill be clarified to ensure that
parents are not prohibited from monitoring, or limiting access to,
their children in regard to pornography and other indecent material on
the Internet. I don't believe anyone wants to restrict parents' rights
to take care of their children, or to take away tools that might be
helpful for parents to ensure that their kids aren't accessing sites
containing pornography. The interests of the copyright owners had to be
balanced with the needs of consumers and

[[Page S4892]]

families. I think that the Committee made a significant improvement to
the bill in defense of this important protection for our families.
  Also, the Committee worked on changes which protect individuals'
right to privacy on the Internet. I've heard concerns about software
programs, probes, contaminants and ``cookies,'' and how they obtain
personal and confidential information on Internet users and then convey
it to companies for commercial purposes, sometimes without the users
even knowing that this is happening. Even if users are aware a
``cookie'' or one of these other techniques has been sent to them, I
think we'd all agree that Internet users should have a choice on
whether to give up their personal information or not. While some argue
that this is a non-issue because ``cookies'' and ``cookie-cutting'' do
not violate the provisions of the bill, I've heard otherwise. In fact,
I've heard about a case where a computer game company admitted that it
surreptitiously collected personal information from users' computers
when they were playing the game via the Internet. So I was not
convinced that there did not need to be a clarification in the bill on
this subject. The intent behind the bill is now clear that an Internet
user can protect his or her privacy by disabling programs that transmit
information on that user to other parties, or by utilizing software
programs like ``cookie-cutters'' to do this.
  I'd also like to make a few remarks on the clarification Senator Kyl
and I worked on dealing with the law enforcement exceptions in the
bill. The changes Senator Kyl and I made substantially improve the
bill's language by making it clear that the exceptions will protect
officers, agents, employees, or contractors of, or other persons acting
at the direction of, a law enforcement or intelligence agency of the
United States, a State, or a political subdivision of a State, who are
performing lawfully authorized investigative, protective, or
intelligence activities. Further, the bill's language was clarified to
indicate that the exceptions also apply to officers, agents, employees,
or contractors of, or other persons acting at the direction of, any
element or division of an agency or department of the United States, a
State, or a political subdivision of a State, which does not have law
enforcement or intelligence as its primary function, when those
individuals are performing lawfully authorized investigative,
protective, or intelligence activities. I'd like to note that the
Committee report makes clear that these exceptions only apply when the
individuals are performing these activities within the scope of their
duties and in furtherance of lawfully authorized activities. Our law
enforcement and intelligence people must have the opportunity and the
tools to carry out their duties effectively. This language was crafted
with the input and support of representatives from the law enforcement
community, the Administration, as well as the content providers and
other parties. I'd like to especially thank Senator Kyl and his fine
staff for their hard work on this important clarification to the bill.
  I want to thank Senator Ashcroft and his staff for all the hard work
and long hours they put into this difficult negotiations process to
improve this bill. Their efforts in working for a balance of interests
in the bill are to be commended. I'd also like to thank Chairman Hatch
and Senator Leahy, and their staffs, for their hard work on the bill.
  Mrs. BOXER. Mr. President I am proud to support the Digital
Millennium Copyright Act (DMCA) of 1998 which I believe is an important
step in the evolution of international digital commerce. The DMCA
accomplishes two important goals--it implements the World Intellectual
Property Organization Copyright Treaty and the World Intellectual
Property Organization Performances and Phonograms Treaty. Both treaties
include provisions that respond to the challenges of digital
technology.
  Although the treaties contain little that is not already covered by
U.S. law, the treaties will provide U.S. copyright holders the
worldwide protections they need and deserve. In addition, the treaties
will go along way towards standardizing international copyright
practice.
  Intellectual property, including copyright, is an integral part of
the U.S. economy. The core copyright industries accounted for $238.6
billion in value added to the U.S. economy, accounting for
approximately 3.74 percent of the Gross Domestic Product. In addition,
between 1977 and 1993, employment in the core copyright industries
doubled to 3 million workers, about 2.5 percent of total U.S.
employment. The copyright industries contribute more to the U.S.
economy and employ more workers than any single manufacturing sector
including aircraft, textiles and apparels or chemicals.
  Intellectual property is a particularly integral part of the economy
of my home state of California. California is the leading producer of
movies, computer software, recordings, video games, and other creative
works. California's movie and television industries employed
approximately 165,000 Californians in 1995 and the combined payroll of
those industries was $7.4 billion. Similarly, the California pre-
packaged computer software industry employs more than 25,000
Californians.
  Finally Mr. President, I want to note the importance of this bill to
Online Service Providers (OSPs) and to Internet Service Providers
(ISPs). I believe it is important to update our copyright laws to
comport with the digital electronic age in which we now operate. This
bill appropriately balances the interests of copyright holders and
OSPs/ISPs. It ensures that creative works receive the protection they
deserve while also assuring that OSPs/ISPs are not held liable for
unknowingly posting infringing material or for merely providing the
physical facilities used to upload infringing material.
  I think this is a good bill, a balanced and fair bill, and I am proud
to support it.
  Mr. THOMPSON. Mr. President, I am pleased to support S. 2037, the
Digital Millennium Copyright Act. This legislation implementing the
World Intellectual Property Organization Treaty is of vital importance
to the American economy.
  No nation benefits more from the protection of intellectual property
than the United States. We lead the world in the production and export
of intellectual property, including the many forms of artistic
intellectual property and computer software. These industries are among
the fastest growing employers in our country. When the owners of
intellectual property are not fairly compensated, that hurts Americans
and it decreases incentives for creating additional intellectual
property that educates, entertains, and does business for us.
  New technology creates exciting opportunities for intellectual
property, but the digital environment also poses threats to this form
of property. Unscrupulous copyright violators can use the Internet to
more widely distribute copyrighted material without permission. To
maintain fair compensation to the owners of intellectual property, a
regime for copyright protection in the digital age must be created.
Technology to protect access to copyrighted work must be safeguarded.
Copyright management information that identifies the copyright owner
and the terms and conditions of use of the copyrighted material must be
secured.
  There are new issues with respect to copyright in the digital age
that never were issues before. The bill addresses such issues as on-
line service provider liability in a way that is fair to all parties.
And it governs a number of other issues that have been accommodated in
the new era.
  Passage of this bill is important if American intellectual property
is to be protected in other countries. I was pleased to be an original
co-sponsor of the initial bill, and to have supported the bill in the
Judiciary Committee and now on the floor. I strongly support its
enactment.
  Mrs. FEINSTEIN. Mr. President, it is with great pleasure that I rise
today to speak on passage of S. 2037, the Digital Millennium Copyright
Act. This Act implements two treaties adopted by the World Intellectual
Property Organization, or WIPO, in December, 1996--the WIPO Copyright
Treaty and the WIPO Performances and Phonograms Treaty.
  Passage of this important legislation will clear the way for
ratification of these treaties, which are in the paramount interest of
the United States--

[[Page S4893]]

and of the State of California, in particular. These treaties are
intended to ensure that foreign countries give intellectual property to
the same high level of protection that we afford it here in the U.S.
  The United States is the world's leader in intellectual property, the
home of the most creative and dynamic individuals and enterprises in
the world--the majority of whom are located in California. This
industry constitutes a very important sector of the U.S. economy, and
contributes greatly to our global economic position: American creative
industries grew twice as fast as the rest of the U.S. economy from
1987-94; more than 3 million Americans worked in the core copyright
industries as of 1994; exports of U.S. intellectual property were more
than $53 billion in 1995; and the Business Software Alliance reports
that 50-60 percent of its revenues come from overseas.
  It is vital that we do everything we can to protect and defend this
important sector of the economy from foreign piracy, especially in this
new digital age, when the potential exists for thousands of absolutely
perfect, priated copies of American intellectual property to be made
almost instantly, at the tough of a button: American copyright owners
lose $15 billion in overseas sales to piracy every year; the digital
gaming industry loses $3.2 billion per year to priacy--almost one third
of its $10.1 billion annual sales; and the recording industry's
domestic business is flat and they need a strong export market for
sales growth.
  Indeed, some countries, such as Argentina, have said that computer
programs aren't even protected by copyright; ratifying WIPO will ensure
that they are. Foreign countries have been waiting for the U.S., as the
world's largest producer of intellectual property, to take the lead in
WIPO ratification before the ratify the WIPO treaty, so this is an
important step we are taking today.
  The bill which we crafted in the Judiciary Committee is a truly
impressive achievement. We worked together with a plethora of diverse
industries, academic interests, and law enforcement to forge a bill
which advances everybody's interest.
  Title I of the bill implements the WIPO treaties, and outlaws so-
called ``black boxes'': devices designed to accomplish the perfect
digital piracy which I have mentioned. By protecting against this
piracy and paving the way for ratification of the WIPO treaties, this
title provides immense help to America's creative industries, including
authors, composers, publishers, performers, movie-makers, the recording
industry, and the software industry.

  Title II of the bill provides for protection from copyright
infringement liability for on-line service providers who act
responsibly. This title provides much-desired protection for on-line
service providers, such as Yahoo! from my State of California,
telecommunications companies, and educational institutions.
  Title II includes a provision which I authored, section 204 of the
bill, which requires the Copyright Office to take a comprehensive look
at the issue of the liability of schools and universities for the acts
of their students and faculty who may use their network to post
infringing materials, and to make recommendations for legislation.
  Among the factors which the Copyright Office is to consider are: What
is the direct, vicarious, and contributory liability of universities
for infringement by: faculty, administrative employees, students,
graduate students, and students who are employed by the university.
  What other users of university computers universities may be
responsible for; the unique nature of the relationship between
universities and faculty; what policies should universities adopt
regarding copyright infringement by university computer users; what
technological measures are available to monitor infringing uses; what
monitoring of the computer system by universities is appropriate; what
due process should the universities afford in disabling access by
allegedly infringing computer users; should distinctions be drawn
between open computer systems, closed computer systems, and open
systems with password-protected parts; and taking into account the
tradition of academic freedom.
  I want to thank the Chairman, Senator Hatch, and the Ranking Member,
Senator Leahy, for working with me on this provision.
  It is my hope and expectation that copyright content providers and
the educational community will get together and work cooperatively to
address these issues during the course of the Copyright Office study.
  Title III of the bill ensures that computer maintenance and repair
providers will not be found liable for copyright infringement for
performing their ordinary services.
  Title IV of the bill provides additional copyright exemptions for
libraries, archives and broadcasters, and another study, of distance
learning, which could benefit educational institutions.
  So this bill helps an incredibly broad spectrum of American
interests: authors, telecommunications, universities, computer makers,
movies, software, broadcasters, and on and on. No small number of these
industries are centered or have very substantial presence in, and
immense importance to the economy of, my state of California.
  Thus, it is with great pleasure that I applaud the passage of this
legislation, and urge the House to protect America's economy and
rapidly pass it as well.
  Mr. KYL. Mr. President: I rise today to speak about a section in the
Digital Millennium Copyright Act that I am particularly proud of, and
that is the law enforcement exception in the bill. At the Judiciary
Committee mark-up, Senator Grassley and I, along with the assistance of
Chairman Hatch and Senator Ashcroft worked to strengthen the law
enforcement exception in the bill. We received input on the language
from the copyright community and the administration: the National
Security Agency (NSA), the Central Intelligence Agency (CIA), the
Departments of Commerce and Justice, and the Office of Management and
Budget (OMB).
  The law enforcement exception ensures that the government continues
to have access to current and future technologies to assist in their
investigative, protective, or intelligence activities. I am concerned
that the tools and resources of our intelligence and law enforcement
communities are preserved--and more importantly, not limited, by
passage of S. 2037. Under this bill, a company who contracts with the
government can continue to develop encryption/decryption devices under
that contract, without having to worry about criminal penalties.
  Because much of our leading technologies come from the private
sector, the government needs to have access to this vital resource for
intelligence and law enforcement purposes.
  The law enforcement exception recognizes that oftentimes governmental
agencies work with non-governmental entities--companies, in order to
have access to and develop cutting edge technologies and devices. Such
conduct should not be prohibited or impeded by this copyright
legislation.
  Mr. BIDEN. Mr. President, I commend my colleagues for their hard work
on this legislation--which implements the two world intellectual
property organization copyright treaties adopted by the 1996 Geneva
diplomatic conference.
  As is the practice on such intellectual property matters, we are
first seeking to pass the implementing legislation. This, I believe,
will pave the way for the Foreign Relations Committee--and the full
senate--to ratify the treaties, which the administration submitted last
July.
  The WIPO treaties and the implementing legislation will update
intellectual property law to deal with the explosion of the Internet
and other forms of electronic communications. Delegates from the United
States and 160 other member nations agreed to give authors of
``literary and artistic works,'' including books, computer programs,
films, and sound recordings, the exclusive right to sell or otherwise
make their work available to the public.
  The treaties give tougher international protection to software makers
and the recording industry--the U.S. Government's biggest goal. The
U.S. wanted--and got--tough international protection for sound
recordings in order to stop pirating of music compact discs overseas.
The treaties protect literary and artistic works from

[[Page S4894]]

digital copying, but do not make it illegal to use the Internet in the
normal way.
  To give a concrete example of what passage and implementation of the
WIPO treaties will mean--before the treaty it was illegal to photocopy
the contents of an entire book or copy a videotape without permission,
but it was not clear whether it was illegal to e-mail copies of a
digital book or movie to 500 friends all over the world. Passage of
this bill and the WIPO treaties will ensure that both will be illegal--
both domestically and overseas.
  I am pleased that this bill contains provisions to clarify the
actions Internet service providers--as well as libraries and
educational institutions--will be legally required to take when
confronted with evidence of copyright violations by users of their
services.
  I am also pleased that this bill contains language intended to
preserve the ability of consumer electronics manufacturers--and
computer manufacturers and software developers--to continue research
and development of innovative devices and hardware products.
  These provisions in my view strike an appropriate balance between the
rights of copyright holders and the need to encourage continuing
expansion of access to digital information to greater numbers of users
throughout the world.
  Therefore, I commend my Judiciary Committee colleagues for their hard
work on this bill and I look forward to its passage by the Congress.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah is recognized.
  Mr. HATCH. Mr. President, we are prepared to yield back the remainder
of our time. First, I understand that the Senator from Illinois would
like up to 2 minutes. We will yield that time to him, and then we will
yield the remainder of the time and go to a vote.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.
  Mr. DURBIN. Mr. President, many good reasons have been stated on the
floor for the passage of this important legislation. I hold in my hand
convincing evidence. It is an unsolicited e-mail sent to my Senate
computer a few weeks ago. It boasts that they will offer for me to
purchase 500 different bootleg video games from a person who says in
this solicitation, ``All the games I sell are pirated. I do not sell
originals.'' This business is operating across the United States,
Canada, England, Australia, and claims to trade copies made in Hong
Kong.
  When you think of the importance of intellectual property to
America's exports and the importance of this business in terms of the
United States and the world, it is clear that we need this legislation
to stop this type of flagrant abuse, which I received and I am sure
many others could receive if they surf the Internet.
  I commend Senators Hatch, Leahy, Ashcroft, and so many others. I urge
its unanimous passage and yield the remainder of my time.
  Mr. HATCH. Mr. President, on behalf of Senator Leahy and myself, I
yield the remainder of our time. The yeas and nays have been ordered.
  The PRESIDING OFFICER. All time having been yielded, the question is
on the engrossment and third reading of the bill.
  The bill was ordered to be engrossed for a third reading and was read
the third time.
  The PRESIDING OFFICER. The question is on passage of the bill, as
amended. The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. NICKLES. I announce that the Senator from New Hampshire (Mr.
Gregg) is necessarily absent.
  The result was announced--yeas 99, nays 0, as follows:

                      [Rollcall Vote No. 137 Leg.]

                                YEAS--99

     Abraham
     Akaka
     Allard
     Ashcroft
     Baucus
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Breaux
     Brownback
     Bryan
     Bumpers
     Burns
     Byrd
     Campbell
     Chafee
     Cleland
     Coats
     Cochran
     Collins
     Conrad
     Coverdell
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Domenici
     Dorgan
     Durbin
     Enzi
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Gorton
     Graham
     Gramm
     Grams
     Grassley
     Hagel
     Harkin
     Hatch
     Helms
     Hollings
     Hutchinson
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnson
     Kempthorne
     Kennedy
     Kerrey
     Kerry
     Kohl
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Mikulski
     Moseley-Braun
     Moynihan
     Murkowski
     Murray
     Nickles
     Reed
     Reid
     Robb
     Roberts
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Torricelli
     Warner
     Wellstone
     Wyden

                             NOT VOTING--1


     Gregg

  The bill (S. 2037), as amended, was passed, as follows:

                                S. 2037

       Be it enacted by the Senate and House of Representatives of
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Digital Millennium Copyright
     Act of 1998''.

     SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.

                 TITLE I--WIPO TREATIES IMPLEMENTATION

Sec. 101. Short title.
Sec. 102. Technical amendments.
Sec. 103. Copyright protection systems and copyright management
              information.
Sec. 104. Conforming amendment.
Sec. 105. Effective date.

          TITLE II--INTERNET COPYRIGHT INFRINGEMENT LIABILITY

Sec. 201. Short title.
Sec. 202. Limitations on liability for Internet copyright infringement.
Sec. 203. Conforming amendment.
Sec. 204. Liability of educational institutions for online infringement
              of copyright.
Sec. 205. Effective date.

               TITLE III--COMPUTER MAINTENANCE OR REPAIR

Sec. 301. Limitation on exclusive rights; computer programs.

   TITLE IV--EPHEMERAL RECORDINGS; DISTANCE EDUCATION; EXEMPTION FOR
                         LIBRARIES AND ARCHIVES

Sec. 401. Ephemeral recordings.
Sec. 402. Limitations on exclusive rights; distance education.
Sec. 403. Exemption for libraries and archives.
                 TITLE I--WIPO TREATIES IMPLEMENTATION

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``WIPO Copyright and
     Performances and Phonograms Treaties Implementation Act of
     1998''.

     SEC. 102. TECHNICAL AMENDMENTS.

       (a) Section 101 of title 17, United States Code, is
     amended--
       (1) by deleting the definition of ``Berne Convention
     work'';
       (2) in the definition of ``The `country of origin' of a
     Berne Convention work'', by deleting ``The `country of
     origin' of a Berne Convention work,'', capitalizing the first
     letter of the word ``for'', deleting ``is the United States''
     after ``For purposes of section 411,'', and inserting ``a
     work is a `United States work' only'' after ``For purposes of
     section 411,'';
       (3) in paragraph (1)(B) of the definition of ``The `country
     of origin' of a Berne Convention work'', by inserting
     ``treaty party or parties'' and deleting ``nation or nations
     adhering to the Berne Convention'';
       (4) in paragraph (1)(C) of the definition of ``The `country
     of origin' of a Berne Convention work'', by inserting ``is
     not a treaty party'' and deleting ``does not adhere to the
     Berne Convention'';
       (5) in paragraph (1)(D) of the definition of ``The `country
     of origin' of a Berne Convention work'', by inserting ``is
     not a treaty party'' and deleting ``does not adhere to the
     Berne Convention'';
       (6) in subsection (3) of the definition of ``The `country
     of origin' of a Berne Convention work'', by deleting ``For
     the purposes of section 411, the `country of origin' of any
     other Berne Convention work is not the United States.'';
       (7) after the definition for ``fixed'', by inserting ``The
     `Geneva Phonograms Convention' is the Convention for the
     Protection of Producers of Phonograms Against Unauthorized
     Duplication of Their Phonograms, concluded at Geneva,
     Switzerland on October 29, 1971.'';
       (8) after the definition for ``including'', by inserting
     ``An `international agreement' is--
       ``(1) the Universal Copyright Convention;
       ``(2) the Geneva Phonograms Convention;
       ``(3) the Berne Convention;
       ``(4) the WTO Agreement;
       ``(5) the WIPO Copyright Treaty;
       ``(6) the WIPO Performances and Phonograms Treaty; and
       ``(7) any other copyright treaty to which the United States
     is a party.'';
       (9) after the definition for ``transmit'', by inserting ``A
     `treaty party' is a country or intergovernmental organization
     other than the United States that is a party to an
     international agreement.'';
       (10) after the definition for ``widow'', by inserting ``The
     `WIPO Copyright Treaty' is the WIPO Copyright Treaty
     concluded at Geneva, Switzerland, on December 20, 1996.'';

[[Page S4895]]

       (11) after the definition for ``The `WIPO Copyright
     Treaty', by inserting ``The `WIPO Performances and Phonograms
     Treaty' is the WIPO Performances and Phonograms Treaty
     concluded at Geneva, Switzerland on December 20, 1996.''; and
       (12) by inserting, after the definition for ``work for
     hire'', ``The `WTO Agreement' is the Agreement Establishing
     the World Trade Organization entered into on April 15, 1994.
     The terms `WTO Agreement' and `WTO member country' have the
     meanings given those terms in paragraphs (9) and (10)
     respectively of section 2 of the Uruguay Round Agreements
     Act.''.
       (b) Section 104 of title 17, United States Code, is
     amended--
       (1) in subsection (b)(1), by deleting ``foreign nation that
     is a party to a copyright treaty to which the United States
     is also a party'' and inserting ``treaty party'';
       (2) in subsection (b)(2) by deleting ``party to the
     Universal Copyright Convention'' and inserting ``treaty
     party'';
       (3) by renumbering the present subsection (b)(3) as (b)(5)
     and moving it to its proper sequential location and inserting
     a new subsection (b)(3) to read:
       ``(3) the work is a sound recording that was first fixed in
     a treaty party; or'';
       (4) in subsection (b)(4) by deleting ``Berne Convention
     work'' and inserting ``pictorial, graphic or sculptural work
     that is incorporated in a building or other structure, or an
     architectural work that is embodied in a building and the
     building or structure is located in the United States or a
     treaty party'';
       (5) by renumbering present subsection (b)(5) as (b)(6);
       (6) by inserting a new subsection (b)(7) to read:
       ``(7) for purposes of paragraph (2), a work that is
     published in the United States or a treaty party within
     thirty days of publication in a foreign nation that is not a
     treaty party shall be considered first published in the
     United States or such treaty party as the case may be.''; and
       (7) by inserting a new subsection (d) to read:
       ``(d) Effect of Phonograms Treaties.--Notwithstanding the
     provisions of subsection (b), no works other than sound
     recordings shall be eligible for protection under this title
     solely by virtue of the adherence of the United States to the
     Geneva Phonograms Convention or the WIPO Performances and
     Phonograms Treaty.''.
       (c) Section 104A(h) of title 17, United States Code, is
     amended--
       (1) in paragraph (1), by deleting ``(A) a nation adhering
     to the Berne Convention or a WTO member country; or (B)
     subject to a Presidential proclamation under subsection
     (g),'' and inserting--
       ``(A) a nation adhering to the Berne Convention;
       ``(B) a WTO member country;
       ``(C) a nation adhering to the WIPO Copyright Treaty;
       ``(D) a nation adhering to the WIPO Performances and
     Phonograms Treaty; or
       ``(E) subject to a Presidential proclamation under
     subsection (g)'';
       (2) paragraph (3) is amended to read as follows:
       ``(3) the term `eligible country' means a nation, other
     than the United States that--
       ``(A) becomes a WTO member country after the date of
     enactment of the Uruguay Round Agreements Act;
       ``(B) on the date of enactment is, or after the date of
     enactment becomes, a nation adhering to the Berne Convention;
       ``(C) adheres to the WIPO Copyright Treaty;
       ``(D) adheres to the WIPO Performances and Phonograms
     Treaty; or
       ``(E) after such date of enactment becomes subject to a
     proclamation under subsection (g).'';
       (3) in paragraph (6)(C)(iii), by deleting ``and'' after
     ``eligibility'';
       (4) at the end of paragraph (6)(D), by deleting the period
     and inserting ``; and'';
       (5) by adding the following new paragraph (6)(E):
       ``(E) if the source country for the work is an eligible
     country solely by virtue of its adherence to the WIPO
     Performances and Phonograms Treaty, is a sound recording.'';
       (6) in paragraph (8)(B)(i), by inserting ``of which''
     before ``the majority'' and striking ``of eligible
     countries''; and
       (7) by deleting paragraph (9).
       (d) Section 411 of title 17, United States Code, is
     amended--
       (1) in subsection (a), by deleting ``actions for
     infringement of copyright in Berne Convention works whose
     country of origin is not the United States and''; and
       (2) in subsection (a), by inserting ``United States'' after
     ``no action for infringement of the copyright in any''.
       (e) Section 507(a) of title 17, United States Code, is
     amended by adding at the beginning, ``Except as expressly
     provided elsewhere in this title,''.

     SEC. 103. COPYRIGHT PROTECTION SYSTEMS AND COPYRIGHT
                   MANAGEMENT INFORMATION.

       Title 17, United States Code, is amended by adding the
     following new chapter:

       ``CHAPTER 12--COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS

``Sec.
``1201. Circumvention of copyright protection systems.
``1202. Integrity of copyright management information.
``1203. Civil remedies.
``1204. Criminal offenses and penalties.
``1205. Savings Clause.

     ``Sec. 1201. Circumvention of copyright protection systems

       ``(a) Violations Regarding Circumvention of Technological
     Protection Measures.--(1) No person shall circumvent a
     technological protection measure that effectively controls
     access to a work protected under this title.
       ``(2) No person shall manufacture, import, offer to the
     public, provide or otherwise traffic in any technology,
     product, service, device, component, or part thereof that--
       ``(A) is primarily designed or produced for the purpose of
     circumventing a technological protection measure that
     effectively controls access to a work protected under this
     title;
       ``(B) has only limited commercially significant purpose or
     use other than to circumvent a technological protection
     measure that effectively controls access to a work protected
     under this title; or
       ``(C) is marketed by that person or another acting in
     concert with that person with that person's knowledge for use
     in circumventing a technological protection measure that
     effectively controls access to a work protected under this
     title.
       ``(3) As used in this subsection--
       ``(A) to `circumvent a technological protection measure'
     means to descramble a scrambled work, to decrypt an encrypted
     work, or otherwise to avoid, bypass, remove, deactivate, or
     impair a technological protection measure, without the
     authority of the copyright owner; and
       ``(B) a technological protection measure `effectively
     controls access to a work' if the measure, in the ordinary
     course of its operation, requires the application of
     information, or a process or a treatment, with the authority
     of the copyright owner, to gain access to the work.
       ``(b) Additional Violations.--(1) No person shall
     manufacture, import, offer to the public, provide, or
     otherwise traffic in any technology, product, service,
     device, component, or part thereof that--
       ``(A) is primarily designed or produced for the purpose of
     circumventing protection afforded by a technological
     protection measure that effectively protects a right of a
     copyright owner under this title in a work or a portion
     thereof;
       ``(B) has only limited commercially significant purpose or
     use other than to circumvent protection afforded by a
     technological protection measure that effectively protects a
     right of a copyright owner under this title in a work or a
     portion thereof; or
       ``(C) is marketed by that person or another acting in
     concert with that person with that person's knowledge for use
     in circumventing protection afforded by a technological
     protection measure that effectively protects a right of a
     copyright owner under this title in a work or a portion
     thereof.
       ``(2) As used in this subsection--
       ``(A) to `circumvent protection afforded by a technological
     protection measure' means avoiding, bypassing, removing,
     deactivating, or otherwise impairing a technological
     protection measure; and
       ``(B) a technological protection measure `effectively
     protects a right of a copyright owner under this title' if
     the measure, in the ordinary course of its operation,
     prevents, restricts, or otherwise limits the exercise of a
     right of a copyright owner under this title.
       ``(c) Other Rights, Etc., Not Affected.--(1) Nothing in
     this section shall affect rights, remedies, limitations, or
     defenses to copyright infringement, including fair use, under
     this title.
       ``(2) Nothing in this section shall enlarge or diminish
     vicarious or contributory liability for copyright
     infringement in connection with any technology, product,
     service, device, component or part thereof.
       ``(3) Nothing in this section shall require that the design
     of, or design and selection of parts and components for, a
     consumer electronics, telecommunications, or computing
     product provide for a response to any particular
     technological protection measure, so long as such part or
     component or the product, in which such part or component is
     integrated, does not otherwise fall within the prohibitions
     of subsection (a)(2) or (b)(1).
       ``(d) Exemption for Nonprofit Libraries, Archives, and
     Educational Institutions.--(1) A nonprofit library, archives,
     or educational institution which gains access to a
     commercially exploited copyrighted work solely in order to
     make a good faith determination of whether to acquire a copy
     of that work for the sole purpose of engaging in conduct
     permitted under this title shall not be in violation of
     subsection (a)(1). A copy of a work to which access has been
     gained under this paragraph--
       ``(A) may not be retained longer than necessary to make
     such good faith determination; and
       ``(B) may not be used for any other purpose.
       ``(2) The exemption made available under paragraph (1)
     shall only apply with respect to a work when an identical
     copy of that work is not reasonably available in another
     form.
       ``(3) A nonprofit library, archives, or educational
     institution that willfully for the purpose of commercial
     advantage or financial gain violates paragraph (1)--
       ``(A) shall, for the first offense, be subject to the civil
     remedies under section 1203; and
       ``(B) shall, for repeated or subsequent offenses, in
     addition to the civil remedies

[[Page S4896]]

     under section 1203, forfeit the exemption provided under
     paragraph (1).
       ``(4) This subsection may not be used as a defense to a
     claim under subsection (a)(2) or (b), nor may this subsection
     permit a nonprofit library, archives, or educational
     institution to manufacture, import, offer to the public,
     provide, or otherwise traffic in any technology which
     circumvents a technological protection measure.
       ``(5) In order for a library or archives to qualify for the
     exemption under this subsection, the collections of that
     library or archives shall be--
       ``(A) open to the public; or
       ``(B) available not only to researchers affiliated with the
     library or archives or with the institution of which it is a
     part, but also to other persons doing research in a
     specialized field.
       ``(e) Law Enforcement and Intelligence Activities.--This
     section does not prohibit any lawfully authorized
     investigative, protective, or intelligence activity of an
     officer, agent or employee of the United States, a State, or
     a political subdivision of a State, or a person acting
     pursuant to a contract with such entities.
       ``(f) Notwithstanding the provisions of subsection (a)(1),
     a person who has lawfully obtained the right to use a copy of
     a computer program may circumvent a technological protection
     measure that effectively controls access to a particular
     portion of that program for the sole purpose of identifying
     and analyzing those elements of the program that are
     necessary to achieve interoperability of an independently
     created computer program with other programs, and that have
     not previously been readily available to the person engaging
     in the circumvention, to the extent any such acts of
     identification and analysis do not constitute infringement
     under this title.
       ``(g) Notwithstanding the provisions of subsections (a)(2)
     and (b), a person may develop and employ technological means
     to circumvent for the identification and analysis described
     in subsection (f), or for the limited purpose of achieving
     interoperability of an independently created computer program
     with other programs, where such means are necessary to
     achieve such interoperability, to the extent that doing so
     does not constitute infringement under this title.
       ``(h) The information acquired through the acts permitted
     under subsection (f), and the means permitted under
     subsection (g), may be made available to others if the person
     referred to in subsections (f) or (g) provides such
     information or means solely for the purpose of achieving
     interoperability of an independently created computer program
     with other programs, and to the extent that doing so does not
     constitute infringement under this title, or violate
     applicable law other than this title.
       ``(i) For purposes of subsections (f), (g), and (h), the
     term ``interoperability'' means the ability of computer
     programs to exchange information, and for such programs
     mutually to use the information which has been exchanged.
       ``(j) In applying subsection (a) to a component or part,
     the court may consider the necessity for its intended and
     actual incorporation in a technology, product, service or
     device, which (i) does not itself violate the provisions of
     this chapter and (ii) has the sole purpose to prevent the
     access of minors to material on the Internet.

     ``Sec. 1202. Integrity of copyright management information

       ``(a) False Copyright Management Information.--No person
     shall knowingly and with the intent to induce, enable,
     facilitate or conceal infringement--
       ``(1) provide copyright management information that is
     false, or
       ``(2) distribute or import for distribution copyright
     management information that is false.
       ``(b) Removal or Alteration of Copyright Management
     Information.--No person shall, without the authority of the
     copyright owner or the law--
       ``(1) intentionally remove or alter any copyright
     management information,
       ``(2) distribute or import for distribution copyright
     management information knowing that the copyright management
     information has been removed or altered without authority of
     the copyright owner or the law, or
       ``(3) distribute, import for distribution, or publicly
     perform works, copies of works, or phonorecords, knowing that
     copyright management information has been removed or altered
     without authority of the copyright owner or the law,

     knowing, or, with respect to civil remedies under section
     1203, having reasonable grounds to know, that it will induce,
     enable, facilitate or conceal an infringement of any right
     under this title.
       ``(c) Definition.--As used in this chapter, `copyright
     management information' means the following information
     conveyed in connection with copies or phonorecords of a work
     or performances or displays of a work, including in digital
     form--
       ``(1) the title and other information identifying the work,
     including the information set forth on a notice of copyright;
       ``(2) the name of, and other identifying information about,
     the author of a work;
       ``(3) the name of, and other identifying information about,
     the copyright owner of the work, including the information
     set forth in a notice of copyright;
       ``(4) with the exception of public performances of works by
     radio and television broadcast stations the name of, and
     other identifying information about, a performer whose
     performance is fixed in a work other than an audiovisual
     work;
       ``(5) with the exception of public performances of works by
     radio and television broadcast stations, in the case of an
     audiovisual work, the name of, and other identifying
     information about, a writer, performer, or director who is
     credited in the audiovisual work;
       ``(6) terms and conditions for use of the work;
       ``(7) identifying numbers or symbols referring to such
     information or links to such information; or
       ``(8) such other information as the Register of Copyrights
     may prescribe by regulation, except that the Register of
     Copyrights may not require the provision of any information
     concerning the user of a copyrighted work.
       ``(d) Law Enforcement and Intelligence Activities.--This
     section does not prohibit any lawfully authorized
     investigative, protective, or intelligence activity of an
     officer, agent, or employee of the United States, a State, or
     a political subdivision of a State, or a person acting
     pursuant to a contract with such entities.
       ``(e) Limitations on Liability.--
       ``(1) Analog transmissions.--In the case of an analog
     transmission, a person who is making transmissions in its
     capacity as a radio or television broadcast station, or as a
     cable system, or someone who provides programming to such
     station or system, shall not be liable for a violation of
     subsection (b) if--
       ``(A) avoiding the activity that constitutes such violation
     is not technically feasible or would create an undue
     financial hardship on such person; and
       ``(B) such person did not intend, by engaging in such
     activity, to induce, enable, facilitate or conceal
     infringement.
       ``(2) Digital transmissions.--
       ``(A) If a digital transmission standard for the placement
     of copyright management information for a category of works
     is set in a voluntary, consensus standard-setting process
     involving a representative cross-section of radio or
     television broadcast stations or cable systems and copyright
     owners of a category of works that are intended for public
     performance by such stations or systems, a person identified
     in subsection (e)(1) shall not be liable for a violation of
     subsection (b) with respect to the particular copyright
     management information addressed by such standard if--
       ``(i) the placement of such information by someone other
     than such person is not in accordance with such standard; and
       ``(ii) the activity that constitutes such violation is not
     intended to induce, enable, facilitate or conceal
     infringement.
       ``(B) Until a digital transmission standard has been set
     pursuant to subparagraph (A) with respect to the placement of
     copyright management information for a category or works, a
     person identified in subsection (e)(1) shall not be liable
     for a violation of subsection (b) with respect to such
     copyright management information, where the activity that
     constitutes such violation is not intended to induce, enable,
     facilitate or conceal infringement, if--
       ``(i) the transmission of such information by such person
     would result in a perceptible visual or aural degradation of
     the digital signal; or
       ``(ii) the transmission of such information by such person
     would conflict with--

       ``(I) an applicable government regulation relating to
     transmission of information in a digital signal;
       ``(II) an applicable industry-wide standard relating to the
     transmission of information in a digital signal that was
     adopted by a voluntary consensus standards body prior to the
     effective date of this section; or
       ``(III) an applicable industry-wide standard relating to
     the transmission of information in a digital signal that was
     adopted in a voluntary, consensus standards-setting process
     open to participation by a representative cross-section of
     radio or television broadcast stations or cable systems and
     copyright owners of a category of works that are intended for
     public performance by such stations or systems.

     ``Sec. 1203. Civil remedies

       ``(a) Civil Actions.--Any person injured by a violation of
     section 1201 or 1202 may bring a civil action in an
     appropriate United States district court for such violation.
       ``(b) Powers of the Court.--In an action brought under
     subsection (a), the court--
       ``(1) may grant temporary and permanent injunctions on such
     terms as it deems reasonable to prevent or restrain a
     violation;
       ``(2) at any time while an action is pending, may order the
     impounding, on such terms as it deems reasonable, of any
     device or product that is in the custody or control of the
     alleged violator and that the court has reasonable cause to
     believe was involved in a violation;
       ``(3) may award damages under subsection (c);
       ``(4) in its discretion may allow the recovery of costs by
     or against any party other than the United States or an
     officer thereof;
       ``(5) in its discretion may award reasonable attorney's
     fees to the prevailing party; and
       ``(6) may, as part of a final judgment or decree finding a
     violation, order the remedial modification or the destruction
     of any device or product involved in the violation that is

[[Page S4897]]

     in the custody or control of the violator or has been
     impounded under paragraph (2).
       ``(c) Award of Damages.--
       ``(1) In general.--Except as otherwise provided in this
     chapter, a person committing a violation of section 1201 or
     1202 is liable for either--
       ``(A) the actual damages and any additional profits of the
     violator, as provided in paragraph (2), or
       ``(B) statutory damages, as provided in paragraph (3).
       ``(2) Actual damages.--The court shall award to the
     complaining party the actual damages suffered by the party as
     a result of the violation, and any profits of the violator
     that are attributable to the violation and are not taken into
     account in computing the actual damages, if the complaining
     party elects such damages at any time before final judgment
     is entered.
       ``(3) Statutory damages.--
       ``(A) At any time before final judgment is entered, a
     complaining party may elect to recover an award of statutory
     damages for each violation of section 1201 in the sum of not
     less than $200 or more than $2,500 per act of circumvention,
     device, product, component, offer, or performance of service,
     as the court considers just.
       ``(B) At any time before final judgment is entered, a
     complaining party may elect to recover an award of statutory
     damages for each violation of section 1202 in the sum of not
     less than $2,500 or more than $25,000.
       ``(4) Repeated violations.--In any case in which the
     injured party sustains the burden of proving, and the court
     finds, that a person has violated section 1201 or 1202 within
     three years after a final judgment was entered against the
     person for another such violation, the court may increase the
     award of damages up to triple the amount that would otherwise
     be awarded, as the court considers just.
       ``(5) Innocent violations.--
       ``(A) In general.--The court in its discretion may reduce
     or remit the total award of damages in any case in which the
     violator sustains the burden of proving, and the court finds,
     that the violator was not aware and had no reason to believe
     that its acts constituted a violation.
       ``(B) Nonprofit library, archives, or educational
     institutions.--In the case of a nonprofit library, archives,
     or educational institution, the court shall remit damages in
     any case in which the library, archives, or educational
     institution sustains the burden of proving, and the court
     finds, that the library, archives, or educational institution
     was not aware and had no reason to believe that its acts
     constituted a violation.

     ``Sec. 1204. Criminal offenses and penalties

       ``(a) In General.--Any person who violates section 1201 or
     1202 willfully and for purposes of commercial advantage or
     private financial gain--
       ``(1) shall be fined not more than $500,000 or imprisoned
     for not more than 5 years, or both for the first offense; and
       ``(2) shall be fined not more than $1,000,000 or imprisoned
     for not more than 10 years, or both for any subsequent
     offense.
       ``(b) Limitation for Nonprofit Library, Archives, or
     Educational Institution.--Subsection (a) shall not apply to a
     nonprofit library, archives, or educational institution.
       ``(c) Statute of Limitations.--Notwithstanding section
     507(a) of this title, no criminal proceeding shall be brought
     under this section unless such proceeding is commenced within
     five years after the cause of action arose.

     ``Sec. 1205. Savings Clause

       ``Nothing in this chapter abrogates, diminishes or weakens
     the provisions of, nor provides any defense or element of
     mitigation in a criminal prosecution or civil action under,
     any Federal or State law that prevents the violation of the
     privacy of an individual in connection with the individual's
     use of the Internet.''.

     SEC. 104. CONFORMING AMENDMENT.

       The table of chapters for title 17, United States Code, is
     amended by adding at the end the following:

``12. Copyright Protection and Management Systems...........1201''.....

     SEC. 105. EFFECTIVE DATE.

       (a) In General.--Subject to subsection (b), the amendments
     made by this title shall take effect on the date of the
     enactment of this Act.
       (b) Amendments Relating to Certain International
     Agreements.--(1) The following shall take effect upon entry
     into force of the WIPO Copyright Treaty with respect to the
     United States:
       (A) paragraph (5) of the definition of ``international
     agreement'' contained in section 101 of title 17, United
     States Code, as amended by section 102(a)(8) of this title.
       (B) the amendment made by section 102(a)(10) of this title;
       (C) subparagraph (C) of section 104A(h)(1) of title 17,
     United States Code, as amended by section 102(c)(1) of this
     title; and
       (D) subparagraph (C) of section 104A(h)(3) of title 17,
     United States Code, as amended by section 102(c)(2) of this
     title.
       (2) The following shall take effect upon the entry into
     force of the WIPO Performances and Phonograms Treaty with
     respect to the United States:
       (A) paragraph (6) of the definition of ``international
     agreement'' contained in section 101 of title 17, United
     States Code, as amended by section 102(a)(8) of this title.
       (B) the amendment made by section 102(a)(11) of this title;
       (C) the amendment made by section 102(b)(7) of this title;
       (D) Subparagraph (D) of section 104A(h)(1) of title 17,
     United States Code, as amended by section 102(c)(2) of this
     title; and
       (E) the amendment made by section 102(c)(4) of this title;
     and
       (F) the amendment made by section 102(c)(5) of this title.
          TITLE II--INTERNET COPYRIGHT INFRINGEMENT LIABILITY

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Internet Copyright
     Infringement Liability Clarification Act of 1998''.

     SEC. 202. LIMITATIONS ON LIABILITY FOR INTERNET COPYRIGHT
                   INFRINGEMENT.

       (a) In General.--Chapter 5 of title 17, United States Code,
     is amended by adding after section 511 the following new
     section:

     ``Sec. 512. Liability of service providers for online
       infringement of copyright

       ``(a) Digital Network Communications.--A service provider
     shall not be liable for monetary relief, or except as
     provided in subsection (i) for injunctive or other equitable
     relief, for infringement for the provider's transmitting,
     routing, or providing connections for, material through a
     system or network controlled or operated by or for the
     service provider, or the intermediate and transient storage
     of such material in the course of such transmitting, routing
     or providing connections, if--
       ``(1) it was initiated by or at the direction of a person
     other than the service provider;
       ``(2) it is carried out through an automatic technical
     process without selection of such material by the service
     provider;
       ``(3) the service provider does not select the recipients
     of such material except as an automatic response to the
     request of another;
       ``(4) no such copy of such material made by the service
     provider is maintained on the system or network in a manner
     ordinarily accessible to anyone other than anticipated
     recipients, and no such copy is maintained on the system or
     network in a manner ordinarily accessible to the anticipated
     recipients for a longer period than is reasonably necessary
     for the communication; and
       ``(5) the material is transmitted without modification to
     its content.
       ``(b) System Caching.--A service provider shall not be
     liable for monetary relief, or except as provided in
     subsection (i) for injunctive or other equitable relief, for
     infringement for the intermediate and temporary storage of
     material on the system or network controlled or operated by
     or for the service provider, where (i) such material is made
     available online by a person other than such service
     provider, (ii) such material is transmitted from the person
     described in clause (i) through such system or network to
     someone other than that person at the direction of such other
     person, and (iii) the storage is carried out through an
     automatic technical process for the purpose of making such
     material available to users of such system or network who
     subsequently request access to that material from the person
     described in clause (i), provided that:
       ``(1) such material is transmitted to such subsequent users
     without modification to its content from the manner in which
     the material otherwise was transmitted from the person
     described in clause (i);
       ``(2) such service provider complies with rules concerning
     the refreshing, reloading or other updating of such material
     when specified by the person making that material available
     online in accordance with an accepted industry standard data
     communications protocol for the system or network through
     which that person makes the material available; provided that
     the rules are not used by the person described in clause (i)
     to prevent or unreasonably impair such intermediate storage;
       ``(3) such service provider does not interfere with the
     ability of technology associated with such material that
     returns to the person described in clause (i) the information
     that would have been available to such person if such
     material had been obtained by such subsequent users directly
     from such person, provided that such technology--
       ``(A) does not significantly interfere with the performance
     of the provider's system or network or with the intermediate
     storage of the material;
       ``(B) is consistent with accepted industry standard
     communications protocols; and
       ``(C) does not extract information from the provider's
     system or network other than the information that would have
     been available to such person if such material had been
     accessed by such users directly from such person;
       ``(4) either--
       ``(A) the person described in clause (i) does not currently
     condition access to such material; or
       ``(B) if access to such material is so conditioned by such
     person, by a current individual pre-condition, such as a pre-
     condition based on payment of a fee, or provision of a
     password or other information, the service provider permits
     access to the stored material in significant part only to
     users of its system or network that have been so authorized
     and only in accordance with those conditions; and
       ``(5) if the person described in clause (i) makes that
     material available online without the authorization of the
     copyright owner, then the service provider responds
     expeditiously to remove, or disable access to, the material
     that is claimed to be infringing

[[Page S4898]]

     upon notification of claimed infringements described in
     subsection (c)(3); provided that the material has previously
     been removed from the originating site, and the party giving
     the notification includes in the notification a statement
     confirming that such material has been removed or access to
     it has been disabled or ordered to be removed or have access
     disabled.
       ``(c) Information Stored on Service Providers.--
       ``(1) In general.--A service provider shall not be liable
     for monetary relief, or except as provided in subsection (i)
     for injunctive or other equitable relief, for infringement
     for the storage at the direction of a user of material that
     resides on a system or network controlled or operated by or
     for the service provider, if the service provider--
       ``(A)(i) does not have actual knowledge that the material
     or activity is infringing,
       ``(ii) in the absence of such actual knowledge, is not
     aware of facts or circumstances from which infringing
     activity is apparent, or
       ``(iii) if upon obtaining such knowledge or awareness, the
     service provider acts expeditiously to remove or disable
     access to, the material;
       ``(B) does not receive a financial benefit directly
     attributable to the infringing activity, where the service
     provider has the right and ability to control such activity;
     and
       ``(C) in the instance of a notification of claimed
     infringement as described in paragraph (3), responds
     expeditiously to remove, or disable access to, the material
     that is claimed to be infringing or to be the subject of
     infringing activity.
       ``(2) Designated agent.--The limitations on liability
     established in this subsection apply only if the service
     provider has designated an agent to receive notifications of
     claimed infringement described in paragraph (3), by
     substantially making the name, address, phone number,
     electronic mail address of such agent, and other contact
     information deemed appropriate by the Register of Copyrights,
     available through its service, including on its website, and
     by providing such information to the Copyright Office. The
     Register of Copyrights shall maintain a current directory of
     agents available to the public for inspection, including
     through the Internet, in both electronic and hard copy
     formats.
       ``(3) Elements of notification.--
       ``(A) To be effective under this subsection, a notification
     of claimed infringement means any written communication
     provided to the service provider's designated agent that
     includes substantially the following:
       ``(i) a physical or electronic signature of a person
     authorized to act on behalf of the owner of an exclusive
     right that is allegedly infringed;
       ``(ii) identification of the copyrighted work claimed to
     have been infringed, or, if multiple such works at a single
     online site are covered by a single notification, a
     representative list of such works at that site;
       ``(iii) identification of the material that is claimed to
     be infringing or to be the subject of infringing activity
     that is to be removed or access to which is to be disabled,
     and information reasonably sufficient to permit the service
     provider to locate the material;
       ``(iv) information reasonably sufficient to permit the
     service provider to contact the complaining party, such as an
     address, telephone number, and, if available an electronic
     mail address at which the complaining party may be contacted;
       ``(v) a statement that the complaining party has a good
     faith belief that use of the material in the manner
     complained of is not authorized by the copyright owner, or
     its agent, or the law; and
       ``(vi) a statement that the information in the notification
     is accurate, and under penalty of perjury, that the
     complaining party has the authority to enforce the owner's
     rights that are claimed to be infringed.
       ``(B) A notification from the copyright owner or from a
     person authorized to act on behalf of the copyright owner
     that fails substantially to conform to the provisions of
     paragraph (3)(A) shall not be considered under paragraph
     (1)(A) in determining whether a service provider has actual
     knowledge or is aware of facts or circumstances from which
     infringing activity is apparent, provided that the provider
     promptly attempts to contact the complaining party or takes
     other reasonable steps to assist in the receipt of notice
     under paragraph (3)(A) when the notice is provided to the
     service provider's designated agent and substantially
     satisfies the provisions of paragraphs (3)(A) (ii), (iii),
     and (iv).
       ``(d) Information Location Tools.--A service provider shall
     not be liable for monetary relief, or except as provided in
     subsection (i) for injunctive or other equitable relief, for
     infringement for the provider referring or linking users to
     an online location containing infringing material or activity
     by using information location tools, including a directory,
     index, reference, pointer or hypertext link, if the
     provider--
       ``(1) does not have actual knowledge that the material or
     activity is infringing or, in the absence of such actual
     knowledge, is not aware of facts or circumstances from which
     infringing activity is apparent;
       ``(2) does not receive a financial benefit directly
     attributable to the infringing activity, where the service
     provider has the right and ability to control such activity;
     and
       ``(3) responds expeditiously to remove or disable the
     reference or link upon notification of claimed infringement
     as described in subsection (c)(3); provided that for the
     purposes of this paragraph, the element in subsection
     (c)(3)(A)(iii) shall be identification of the reference or
     link, to material or activity claimed to be infringing, that
     is to be removed or access to which is to be disabled, and
     information reasonably sufficient to permit the service
     provider to locate such reference or link.
       ``(e) Misrepresentations.--Any person who knowingly
     materially misrepresents under this section (1) that material
     or activity is infringing, or (2) that material or activity
     was removed or disabled by mistake or misidentification,
     shall be liable for any damages, including costs and
     attorneys' fees, incurred by the alleged infringer, by any
     copyright owner or copyright owner's authorized licensee, or
     by the service provider, who is injured by such
     misrepresentation, as the result of the service provider
     relying upon such misrepresentation in removing or disabling
     access to the material or activity claimed to be infringing,
     or in replacing the removed material or ceasing to disable
     access to it.
       ``(f) Replacement of Removed or Disabled Material and
     Limitation on Other Liability.--
       ``(1) Subject to paragraph (2) of this subsection, a
     service provider shall not be liable to any person for any
     claim based on the service provider's good faith disabling of
     access to, or removal of, material or activity claimed to be
     infringing or based on facts or circumstances from which
     infringing activity is apparent, regardless of whether the
     material or activity is ultimately determined to be
     infringing.
       ``(2) Paragraph (1) of this subsection shall not apply with
     respect to material residing at the direction of a subscriber
     of the service provider on a system or network controlled or
     operated by or for the service provider that is removed, or
     to which access is disabled by the service provider pursuant
     to a notice provided under subsection (c)(1)(C), unless the
     service provider--
       ``(A) takes reasonable steps promptly to notify the
     subscriber that it has removed or disabled access to the
     material;
       ``(B) upon receipt of a counter notice as described in
     paragraph (3), promptly provides the person who provided the
     notice under subsection (c)(1)(C) with a copy of the counter
     notice, and informs such person that it will replace the
     removed material or cease disabling access to it in ten
     business days; and
       ``(C) replaces the removed material and ceases disabling
     access to it not less than ten, nor more than fourteen,
     business days following receipt of the counter notice, unless
     its designated agent first receives notice from the person
     who submitted the notification under subsection (c)(1)(C)
     that such person has filed an action seeking a court order to
     restrain the subscriber from engaging in infringing activity
     relating to the material on the service provider's system or
     network.
       ``(3) To be effective under this subsection, a counter
     notification means any written communication provided to the
     service provider's designated agent that includes
     substantially the following:
       ``(A) a physical or electronic signature of the subscriber;
       ``(B) identification of the material that has been removed
     or to which access has been disabled and the location at
     which such material appeared before it was removed or access
     was disabled;
       ``(C) a statement under penalty of perjury that the
     subscriber has a good faith belief that the material was
     removed or disabled as a result of mistake or
     misidentification of the material to be removed or disabled;
       ``(D) the subscriber's name, address and telephone number,
     and a statement that the subscriber consents to the
     jurisdiction of Federal Court for the judicial district in
     which the address is located, or if the subscriber's address
     is outside of the United States, for any judicial district in
     which the service provider may be found, and that the
     subscriber will accept service of process from the person who
     provided notice under subsection (c)(1)(C) or agent of such
     person.
       ``(4) A service provider's compliance with paragraph (2)
     shall not subject the service provider to liability for
     copyright infringement with respect to the material
     identified in the notice provided under subsection (c)(1)(C).
       ``(g) Identification of Direct Infringer.--The copyright
     owner or a person authorized to act on the owner's behalf may
     request an order for release of identification of an alleged
     infringer by filing (i) a copy of a notification described in
     subsection (c)(3)(A), including a proposed order, and (ii) a
     sworn declaration that the purpose of the order is to obtain
     the identity of an alleged infringer and that such
     information will only be used for the purpose of this title,
     with the clerk of any United States district court. The order
     shall authorize and order the service provider receiving the
     notification to disclose expeditiously to the copyright owner
     or person authorized by the copyright owner information
     sufficient to identify the alleged direct infringer of the
     material described in the notification to the extent such
     information is available to the service provider. The order
     shall be expeditiously issued if the accompanying
     notification satisfies the provisions of subsection (c)(3)(A)
     and the accompanying declaration is properly executed. Upon
     receipt of the order, either accompanying or subsequent to
     the receipt of a notification described in subsection
     (c)(3)(A), a service provider shall expeditiously give to the

[[Page S4899]]

     copyright owner or person authorized by the copyright owner
     the information required by the order, notwithstanding any
     other provision of law and regardless of whether the service
     provider responds to the notification.
       ``(h) Conditions for Eligibility.--
       ``(1) Accommodation of technology.--The limitations on
     liability established by this section shall apply only if the
     service provider--
       ``(A) has adopted and reasonably implemented, and informs
     subscribers of the service of, a policy for the termination
     of subscribers of the service who are repeat infringers; and
       ``(B) accommodates and does not interfere with standard
     technical measures as defined in this subsection.
       ``(2) Definition.--As used in this section, ``standard
     technical measures'' are technical measures, used by
     copyright owners to identify or protect copyrighted works,
     that--
       ``(A) have been developed pursuant to a broad consensus of
     copyright owners and service providers in an open, fair,
     voluntary, multi-industry standards process;
       ``(B) are available to any person on reasonable and
     nondiscriminatory terms; and
       ``(C) do not impose substantial costs on service providers
     or substantial burdens on their systems or networks.
       ``(i) Injunctions.--The following rules shall apply in the
     case of any application for an injunction under section 502
     against a service provider that is not subject to monetary
     remedies by operation of this section:
       ``(1) Scope of relief.--
       ``(A) With respect to conduct other than that which
     qualifies for the limitation on remedies as set forth in
     subsection (a), the court may only grant injunctive relief
     with respect to a service provider in one or more of the
     following forms:
       ``(i) an order restraining it from providing access to
     infringing material or activity residing at a particular
     online site on the provider's system or network;
       ``(ii) an order restraining it from providing access to an
     identified subscriber of the service provider's system or
     network who is engaging in infringing activity by terminating
     the specified accounts of such subscriber; or
       ``(iii) such other injunctive remedies as the court may
     consider necessary to prevent or restrain infringement of
     specified copyrighted material at a particular online
     location, provided that such remedies are the least
     burdensome to the service provider that are comparably
     effective for that purpose.
       ``(B) If the service provider qualifies for the limitation
     on remedies described in subsection (a), the court may only
     grant injunctive relief in one or both of the following
     forms:
       ``(i) an order restraining it from providing access to an
     identified subscriber of the service provider's system or
     network who is using the provider's service to engage in
     infringing activity by terminating the specified accounts of
     such subscriber; or
       ``(ii) an order restraining it from providing access, by
     taking specified reasonable steps to block access, to a
     specific, identified, foreign online location.
       ``(2) Considerations.--The court, in considering the
     relevant criteria for injunctive relief under applicable law,
     shall consider:
       ``(A) whether such an injunction, either alone or in
     combination with other such injunctions issued against the
     same service provider under this subsection, would
     significantly burden either the provider or the operation of
     the provider's system or network;
       ``(B) the magnitude of the harm likely to be suffered by
     the copyright owner in the digital network environment if
     steps are not taken to prevent or restrain the infringement;
       ``(C) whether implementation of such an injunction would be
     technically feasible and effective, and would not interfere
     with access to noninfringing material at other online
     locations; and
       ``(D) whether other less burdensome and comparably
     effective means of preventing or restraining access to the
     infringing material are available.
       ``(3) Notice and ex parte orders.--Injunctive relief under
     this subsection shall not be available without notice to the
     service provider and an opportunity for such provider to
     appear, except for orders ensuring the preservation of
     evidence or other orders having no material adverse effect on
     the operation of the service provider's communications
     network.
       ``(j) Definitions.--
       ``(1)(A) As used in subsection (a), the term ``service
     provider'' means an entity offering the transmission, routing
     or providing of connections for digital online
     communications, between or among points specified by a user,
     of material of the user's choosing, without modification to
     the content of the material as sent or received.
       ``(B) As used in any other subsection of this section, the
     term ``service provider'' means a provider of online services
     or network access, or the operator of facilities therefor,
     and includes an entity described in the preceding paragraph
     of this subsection.
       ``(2) As used in this section, the term ``monetary relief''
     means damages, costs, attorneys' fees, and any other form of
     monetary payment.
       ``(k) Other Defenses Not Affected.--The failure of a
     service provider's conduct to qualify for limitation of
     liability under this section shall not bear adversely upon
     the consideration of a defense by the service provider that
     the service provider's conduct is not infringing under this
     title or any other defense.
       ``(l) Protection of Privacy.--Nothing in this section shall
     be construed to condition the applicability of subsections
     (a) through (d) on--
       ``(1) a service provider monitoring its service or
     affirmatively seeking facts indicating infringing activity
     except to the extent consistent with a standard technical
     measure complying with the provisions of subsection (h); or
       ``(2) a service provider accessing, removing, or disabling
     access to material where such conduct is prohibited by law.
       ``(m) Rule of Construction.--Subsections (a), (b), (c), and
     (d) are intended to describe separate and distinct functions
     for purposes of analysis under this section. Whether a
     service provider qualifies for the limitation on liability in
     any one such subsection shall be based solely on the criteria
     in each such subsection and shall not affect a determination
     of whether such service provider qualifies for the
     limitations on liability under any other such subsection.''.

     SEC. 203. CONFORMING AMENDMENT.

       The table of sections for chapter 5 of title 17, United
     States Code, is amended by adding at the end the following:

``512. Liability of service providers for online infringement of
              copyright.''.

      SEC. 204. LIABILITY OF EDUCATIONAL INSTITUTIONS FOR ONLINE
                   INFRINGEMENT OF COPYRIGHT.

       (a) Not later than six months after the date of enactment
     of this Act, the Register of Copyrights, after consultation
     with representatives of copyright owners and nonprofit
     educational institutions, shall submit to the Congress
     recommendations regarding the liability of nonprofit
     educational institutions for copyright infringement committed
     with the use of computer systems for which such an
     institution is a service provider, as that term is defined in
     section 512 of title 17, United States Code, (as amended by
     this Act), including recommendations for legislation the
     Register of Copyrights considers appropriate regarding such
     liability, if any.
       (b) In formulating recommendations, the Register of
     Copyrights shall consider, where relevant--
       (1) current law regarding the direct, vicarious, and
     contributory liability of nonprofit educational institutions
     for infringement by faculty, administrative employees,
     students, graduate students, and students who are employees
     of a nonprofit educational institution;
       (2) other users of their computer systems for whom
     nonprofit educational institutions may be responsible;
       (3) the unique nature of the relationship between nonprofit
     educational institutions and faculty;
       (4) what policies nonprofit educational institutions should
     adopt regarding copyright infringement by users of their
     computer systems;
       (5) what technological measures are available to monitor
     infringing uses;
       (6) what monitoring of their computer systems by nonprofit
     educational institutions is appropriate;
       (7) what due process nonprofit educational institutions
     should afford in disabling access by users of their computer
     systems who are alleged to have committed copyright
     infringement;
       (8) what distinctions, if any, should be drawn between
     computer systems which may be accessed from outside the
     nonprofit educational systems, those which may not, and
     combinations thereof;
       (9) the tradition of academic freedom; and
       (10) such other issues relating to the liability of
     nonprofit educational institutions for copyright infringement
     committed with the use of computer systems for which such an
     institution is a service provider that the Register considers
     appropriate.

     SEC. 205. EFFECTIVE DATE.

       This title and the amendments made by this title shall take
     effect on the date of the enactment of this Act.
               TITLE III--COMPUTER MAINTENANCE OR REPAIR

     SEC. 301. LIMITATION ON EXCLUSIVE RIGHTS; COMPUTER PROGRAMS.

       Section 117 of title 17, United States Code, is amended--
       (1) by striking ``Notwithstanding'' and inserting the
     following:
       ``(a) Making of Additional Copy or Adaptation by Owner of
     Copy.--Notwithstanding'';
       (2) by striking ``Any exact'' and inserting the following:
       ``(b) Lease, Sale, or Other Transfer of Additional Copy or
     Adaptation.--Any exact''; and
       (3) by adding at the end the following new subsections:
       ``(c) Machine Maintenance or Repair.--Notwithstanding the
     provisions of section 106, it is not an infringement for an
     owner or lessee of a machine to make or authorize the making
     of a copy of a computer program if such copy is made solely
     by virtue of the activation of a machine that lawfully
     contains an authorized copy of the computer program, for
     purposes only of maintenance or repair of that machine, if--
       ``(1) such new copy is used in no other manner and is
     destroyed immediately after the maintenance or repair is
     completed; and
       ``(2) with respect to any computer program or part thereof
     that is not necessary for that

[[Page S4900]]

     machine to be activated, such program or part thereof is not
     accessed or used other than to make such new copy by virtue
     of the activation of the machine.
       ``(d) Definitions.--For purposes of this section--
       ``(1) the `maintenance' of a machine is the servicing of
     the machine in order to make it work in accordance with its
     original specifications and any changes to those
     specifications authorized for that machine; and
       ``(2) the `repair' of a machine is the restoring of the
     machine to the state of working in accordance with its
     original specifications and any changes to those
     specifications authorized for that machine.''.
   TITLE IV--EPHEMERAL RECORDINGS; DISTANCE EDUCATION; EXEMPTION FOR
                         LIBRARIES AND ARCHIVES

     SEC. 401. EPHEMERAL RECORDINGS.

       Section 112 of title 17, United States Code is amended by--
       (1) redesignating section 112(a) as 112(a)(1), and
     renumbering sections 112(a) (1), (2), and (3) as sections
     112(a)(1) (A), (B), and (C), respectively;
       (2) in section 112(a)(1), after the reference to section
     114(a), add the words ``or for a transmitting organization
     that is a broadcast radio or television station licensed as
     such by the Federal Communications Commission that broadcasts
     a performance of a sound recording in a digital format on a
     nonsubscription basis,'';
       (3) adding new section 112(a)(2) as follows:
       ``(2) Where a transmitting organization entitled to make a
     copy or phonorecord under section 112(a)(1) in connection
     with the transmission to the public of a performance or
     display of a work pursuant to that section is prevented from
     making such copy or phonorecord by reason of the application
     by the copyright owner of technical measures that prevent the
     reproduction of the work, such copyright owner shall make
     available to the transmitting organization the necessary
     means for permitting the making of such copy or phonorecord
     within the meaning of that section, provided that it is
     technologically feasible and economically reasonable for the
     copyright owner to do so, and provided further that, if such
     copyright owner fails to do so in a timely manner in light of
     the transmitting organization's reasonable business
     requirements, the transmitting organization shall not be
     liable for a violation of section 1201(a)(1) of this title
     for engaging in such activities as are necessary to make such
     copies or phonorecords as permitted under section
     112(a)(1).''.

     SEC. 402. LIMITATIONS ON EXCLUSIVE RIGHTS; DISTANCE
                   EDUCATION.

       (a) Not later than six months after the date of enactment
     of this Act, the Register of Copyrights, after consultation
     with representatives of copyright owners, nonprofit
     educational institutions and nonprofit libraries and
     archives, shall submit to the Congress recommendations on how
     to promote distance education through digital technologies,
     including interactive digital networks, while maintaining an
     appropriate balance between the rights of copyright owners
     and the needs of users. Such recommendations shall include
     any legislation the Register of Copyrights considers
     appropriate to achieve the foregoing objective.
       (b) In formulating recommendations, the Register of
     Copyrights shall consider--
       (1) the need for an exemption from exclusive rights for
     distance education through digital networks;
       (2) the categories of works to be included under any
     distance education exemption;
       (3) the extent of appropriate quantitative limitations on
     the portions of works that may be used under any distance
     education exemption;
       (4) the parties who should be entitled to the benefits of
     any distance education exemption;
       (5) the parties who should be designated as eligible
     recipients of distance education materials under any distance
     education exemption;
       (6) whether and what types of technological measures can
     and/or should be employed to safeguard against unauthorized
     access to, and use or retention of, copyrighted materials as
     a condition to eligibility for any distance education
     exemption, including, in light of developing technological
     capabilities, the exemption set out in section 110(2);
       (7) the extent to which the availability of licenses for
     the use of copyrighted works in distance education through
     interactive digital networks should be considered in
     assessing eligibility for any distance education exemption;
     and
       (8) such other issues relating to distance education
     through interactive digital networks that the Register
     considers appropriate.

     SEC. 403. EXEMPTION FOR LIBRARIES AND ARCHIVES.

       Section 108 of title 17, United States Code, is amended--
       (1) in subsection (a) by--
       (A) striking ``Notwithstanding'' and inserting ``Except as
     otherwise provided and notwithstanding'';
       (B) inserting after ``no more than one copy of phonorecord
     of a work'' the following: ``except as provided in
     subsections (b) and (c),''; and
       (C) by inserting after ``copyright'' in clause (3) the
     following: ``if such notice appears on the copy or
     phonorecord that is reproduced under the provisions of this
     section, or a legend stating that the work may be protected
     by copyright if no such notice can be found on the copy or
     phonorecord that is reproduced under the provisions of this
     section'';
       (2) in subsection (b) by--
       (A) striking ``a copy or phonorecord'' and inserting in
     lieu thereof ``three copies or phonorecords'';
       (B) striking ``in facsimile form''; and
       (C) striking ``if the copy or phonorecord reproduced is
     currently in the collections of the library or archives.''
     and inserting in lieu thereof ``if--
       ``(1) the copy or phonorecord reproduced is currently in
     the collections of the library or archives; and
       ``(2) any such copy or phonorecord that is reproduced in
     digital format is not otherwise distributed in that format
     and is not made available to the public outside the premises
     of the library or archives in that format.''; and
       (3) in subsection (c) by--
       (A) striking ``a copy or phonorecord'' and inserting in
     lieu thereof ``three copies or phonorecords'';
       (B) striking ``in facsimile form'';
       (C) inserting ``or if the existing format in which the work
     is stored has become obsolete,'' after ``stolen,''; and
       (D) striking ``if the library or archives has, after a
     reasonable effort, determined that an unused replacement
     cannot be obtained at a fair price.'' and inserting in lieu
     thereof ``if--
       ``(1) the library or archives has, after a reasonable
     effort, determined that an unused replacement cannot be
     obtained at a fair price; and
       ``(2) any such copy or phonorecord that is reproduced in
     digital format is not made available to the public in that
     format except for use on the premises of the library or
     archives in lawful possession of such copy.'';
       (E) adding at the end the following: ``For purposes of this
     subsection, a format shall be considered obsolete if the
     machine or device necessary to render perceptible a work
     stored in that format is no longer manufactured or is no
     longer reasonably available in the commercial marketplace.''.

  Mr. HATCH. Mr. President, I move to reconsider the vote.
  Mr. SMITH of Oregon. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Mississippi.

                          ____________________
