Preliminary Thoughts on Stop Online Piracy Act (SOPA)

by on October 26, 2011 · 18 comments

This afternoon the Stop Online Piracy Act (H.R. 3261) was introduced by Rep. Lamar Smith of the House Judiciary Committee. This bill is a companion to the PROTECT IP Act and S.978, both of which were reported by the Senate Judiciary Committee in May.

There’s a lot some to like about the bill, but I’m uneasy about some quite a few of its provisions. While I’ll have plenty to say about this bill in the future, for now, here are a few preliminary thoughts:

  • The bill’s definition of “foreign infringing sites” at p. 10 borrows heavily from 18 U.S.C. § 2323, covering any site that commits or facilitates the commission of criminal copyright infringement and would be subject to civil forfeiture if it were U.S.-based. Unfortunately, the outer bounds of 18 U.S.C. § 2323 are quite unclear. The statute, which was enacted only a few years ago, encompasses “any property used, or intended to be used, in any manner or part to commit or facilitate” criminal copyright infringement. While I’m all for shutting down websites operated by criminal enterprises, not all websites used to facilitate crimes are guilty of wrongdoing. Imagine a user commits criminal copyright infringement using a foreign video sharing site similar to YouTube, but the site is unaware of the infringement. Since the site is “facilitating” criminal copyright infringement, albeit unknowingly, is it subject to the Stop Online Piracy Act?
  • Section 103 of the bill, which creates a DMCA-like notification/counter-notification regime, appears to lack any provision encouraging ad networks and payment processors to restore service to a site allegedly “dedicated to theft of U.S. property” upon receipt of a valid counter-notification and when no civil action has been brought. The DMCA contains a safe harbor protecting service providers who take reasonable steps to take down content from liability, but the safe harbor only applies if service providers promptly restore allegedly infringing content upon receipt of a counter notification and when the rights holder does not initiate a civil action. Why doesn’t H.R. 3261 include a similar provision?
  • The bill’s private right of action closely resembles that found in the PROTECT IP Act. Affording rights holders a legal avenue to take action against rogue websites makes sense, but I’m uneasy about creating a private right of action that allows courts to issue such broad preliminary injunctions against allegedly infringing sites. I’m also concerned about the lack of a “loser pays” provision.
  • Section 104 of the bill, which provides immunity for entities that take voluntary actions against infringing sites, now excludes from its safe harbor actions that are not “consistent with the entity’s terms of service or other contractual rights.” This is a welcome change and alleviates concerns I expressed about the PROTECT IP Act essentially rendering certain private contracts unenforceable.
  • Section 201 of the bill makes certain public performances via electronic means a felony. The section contains a rule of construction at p. 60 that clarifies that intentional copying is not “willful” if it’s based on a good faith belief with a reasonable basis in law that the copying is lawful. Could this provision cause courts to revisit the willfulness standard discussed in United States v. Moran, in which a federal court found that a defendant charged with criminal copyright infringement was not guilty because he (incorrectly) thought his conduct was permitted by the Copyright act?

  • Tom Sydnor

    Ryan, thanks, as usual, for thinking carefully and critically about H.R. 3261. Here are my initial reactions to your five points about H.R. 3261.
    Your first point should probably be narrowed. Forfeitures have been part of copyright law for a long time, and civil forfeitures to the government have been around long enough to prompt the enactment of laws intended to remediate the type of “innocent-intermediary” situation that you describe. Look at 18 U.S.C. sec. 2323(a)(2). It refers you to “Chapter 46 relating to civil forfeitures.”
    In Chapter 46 of the Criminal Code, 18 U.S.C. sec. 983(d) establishes an “innocent owner defense” for property owners who either did not know of the conduct that gave rise to the forfeiture or acted reasonably upon learning of it. I have thus used the neologism “culpable facilitation” when characterizing the standard for forfeiture under 18 U.S.C. sec. 2323.
    Your second point seems pretty sound. I’m not sure that the law should encourage restoration of service, but implicitly, that is an option if a counternotice is served under H.R. 32, particularly if no private action is subsequently filed. Nevertheless, given that a payment processor or an ad-network operator probably has a financial incentive to restore, (except, perhaps, in cases in which the processor or operator can see that the counternotice is pretty lame), I suspect that the law could reasonably leave the service-restoration decision to the judgment of the intermediary, with no pressure either way.
    Your third point is interesting, but at least preliminarily, I am not that concerned. As a general matter, it is difficult to get a PI or TRO even in an IP case. But the Rule 65 standards for preliminary relief should make it extremely difficult to get in any case in which the only relief to which the plaintiff could be entitled would be an injunction. (Why not just litigate the merits quickly?). I can imagine odd scenarios in which preliminary relief might make sense, but such cases should be uncommon, at best. Moreover, as a practical matter, legal actions under PROTECT IP or E-PARASITE provide internet analogs to customs seizures, and if the latter are any guide, then contested proceedings will be very, very rare. Finally, I suspect that copyright nor trademark owners are not the ones objecting to the use of the loser-pays model often incorporated in IP laws.
    Your fourth point is sound, but I suspect that this change will have very few practical effects. Terms of Service would almost never be interpreted to require the offeror to perform, aid, abet, or facilitate any tortious or illegal act. Even if that interpretation was unavoidable, then I believe that the general rule is that such contracts are contrary to public policy, and thus void and unenforceable. Nevertheless, I agree it is better to err on the side of enforcing legally enforceable private agreements.
    Your fifth point asks whether Sec. 201(c) might have negative implications upon the interpretation of “willfulness” in contexts covered by Sec. 201. I think the answer is pretty clearly “no.” Stating something like “x shall not be deemed to be ‘willful’ conduct” neither states nor implies anything about whether other types of conduct do or do not qualify as willful. As a result, I think the usual rules of statutory interpretation would preclude Sec. 201(c) from being interpreted to have negative implications.
    Those are my initial reactions, and I hope they are helpful. In any case, thanks for calling attention to tthese five issues. They all deserve attention. –Tom

  • Ryan Radia

    Thanks, Tom.

    According to Sutherland’s § 22, under the rules of statutory construction regarding amendatory acts, it is generally presumed that the legislature is aware of the prior judicial construction of the statute. Where Congress has amended a statute, but left some portions unchanged, the presumption is that Congress intended to leave the untouched provisions’ original meaning intact. Moreover, as the 7th Cir. held in Brown v. Marquette Sav. & Loan Ass’n, “[o]ne method of interpreting the significance of subsequent amendments to a statute takes dispute or ambiguity, such as a split in the circuits, to be an indication that a subsequent amendment is intended to clarify, rather than change, the existing law.” Another relevant principle is that the enumeration by Congress of one case excludes another, assuming the unmentioned items are part of a commonly associated group. In such instances, the choice to enumerate one case but not another justifies that inference that the unmentioned items were excluded deliberately, not inadvertently. (See Perlin v. Hitachi Capital Am. Corp., 497 F.3d 364, 369 (3d Cir. 2007)).

    In the case of SOPA, we should presume that Congress realizes that courts are split on the meaning of the term “willful” for purposes of criminal copyright infringement. Since Section 201(c) explicitly states that its rule of construction holds solely “for purposes of amendments made by this section,” we should presume that Congress intends for SOPA to have no affect on how courts interpret the term “willful” for purposes of the statutory provisions unchanged by SOPA. So while it’s safe to say that SOPA won’t affect how courts determine willfulness in cases involving defendants accused of reproduction or distribution, I suspect courts will presume that § 201(c) is aimed at clarifying that the “intent to copy” line of cases should not apply in cases arising under the SOPA amendments. Thus, in one sense, criminal defendants charged with violating the performance right will enjoy greater protections than defendants charged with criminal reproduction/distribution. However, since courts will presume Congress was aware of the conflicting interpretations of “willful,” and given the rule that inclusion implies exclusion, won’t courts assume that Congress intentionally included the phrase “reasonable basis in law” for the purpose of excluding defendants whose belief in the legality of their conduct was unreasonable? Maybe not, but I see no reason why Section 201(c) should include the “reasonable basis in law” phrase.

    On a related note, what do you make of the fact that SOPA — unlike S.978 — would criminalize certain public performances via electronic means without any attendant “commercial advantage or private financial gain?” Unlike S.978, SOPA amends 17 U.S.C. § 506(a)(1)(B) to include public performances, and further amends 18 U.S.C. § 2319(c)(1) to include public performances.

  • Ryan Radia

    Thanks, Tom.

    According to Sutherland’s § 22, under the rules of statutory construction regarding amendatory acts, it is generally presumed that the legislature is aware of the prior judicial construction of the statute amended. Where Congress has amended a statute, but left some portions unchanged, the presumption is that Congress intended to leave the untouched provisions’ original meaning intact. Moreover, as the 7th Cir. held in Brown v. Marquette Sav. & Loan Ass’n, “[o]ne method of interpreting the significance of subsequent amendments to a statute takes dispute or ambiguity, such as a split in the circuits, to be an indication that a subsequent amendment is intended to clarify, rather than change, the existing law.” Another relevant principle is that the enumeration in a statute by Congress of one case excludes another, assuming the unmentioned items are part of a commonly associated group. In such instances, the choice to enumerate one case but not another justifies that inference that the unmentioned items were excluded deliberately, not inadvertently. See Perlin v. Hitachi Capital Am. Corp., 497 F.3d 364, 369 (3d Cir. 2007).

    In the case of SOPA, we should presume that Congress realizes that courts are split on the meaning of the term “willful” for purposes of criminal copyright infringement. Since Section 201(c) explicitly states that its rule of construction holds solely “for purposes of amendments made by this section,” we should presume that Congress intends for SOPA to have no affect on how courts interpret the term “willful” for purposes of the statutory provisions unchanged by SOPA. So while it’s safe to say that SOPA won’t affect how courts determine willfulness in cases involving defendants accused of reproduction or distribution, I suspect courts will presume that § 201(c) is aimed at clarifying that the “intent to copy” minority line of cases should not apply in cases arising under the SOPA amendments. Thus, in one sense, criminal defendants charged with violating the performance right will enjoy greater protections than defendants charged with criminal reproduction/distribution. However, since courts will presume Congress was aware of the conflicting interpretations of “willful,” and in light of the “inclusion implies exclusion” canon, won’t courts assume that Congress intentionally included the phrase “reasonable basis in law” for the purpose of excluding defendants whose belief in the legality of their conduct was unreasonable? Maybe not, but I see no reason why Section 201(c) should include the “reasonable basis in law” phrase given how many theoretical defendants have no clue what the Copyright Act does.

    On a related note, what do you make of the fact that SOPA — unlike S.978 — would criminalize certain public performances via electronic means without any attendant “commercial advantage or private financial gain?” Unlike S.978, SOPA amends 17 U.S.C. § 506(a)(1)(B) to include public performances, and further amends 18 U.S.C. § 2319(c)(1) to include public performances.  

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  • http://srynas.blogspot.com/ Steve R.

    This is a disappointing post based on the premise “The Technology Liberation Front is the tech policy blog dedicated to keeping politicians’ hands off the ‘net and everything else related to technology.”. Based on the fundamental Libertarian premise that government is inefficient and that regulations would have unintended consequences; I would have expected a post calling for less regulation not more.

    In terms of broad policy, this law seems to be an extension of the continued “land grab” by the private sector in further aggrandizing their so-called property rights which even includes criminalizing certain market activities. As an aside, if it is acceptable for corporations to have government protection through the police power of the State, why doesn’t the consumer get equal protection? Laws that serve one segment of society at the expense of another will diminish respect for the law and may cripple the entire concept of “the rule of law.”.

    The so-called “war” on piracy is one of many current on-going “wars” were the Politicians are promoting FUD to imposed continued incremental loss of liberties in the US.

    There is also a foreign policy implication.  There is a phrase, what goes around comes around. The US today may be a technological leader, but other countries (such as China) may begin to assume degrees of technological leadership. They may look at our laws and emulate them. Should that happen we may well end-up paying these countries/companies exorbitant licensing fees. Given our increasing deficit, do we really want to promote so-called “intellectual property” rights that could be used against us?

  • Ryan Radia

    Like our nation’s framers, I believe that defining and enforcing the terms of intellectual privilege in a way that furthers social welfare is among the few legitimate functions of government. That’s not an easy task, to say the least, and Congress has failed time and time again to pass IP laws that actually “promote the progress of science and the useful arts.” With respect to copyright law, exclusivity terms should be reduced dramatically, damage awards overhauled, and access to orphan works expanded substantially. And that’s just the tip of the iceberg!

    Based on my reading of the empirical literature, the optimal level of copyright protection is greater than zero. As such, I reluctantly support anti-rogue websites legislation in principle because I believe that lawmakers could, at least in theory, address the genuine problems these websites pose to consumers without harming free speech, entrepreneurship, or Internet freedom. However, given that Congress’s third stab at the matter — SOPA — is in many respects even more problematic than its predecessors (COICA and PIPA), I am increasingly doubtful that the political will exists on Capitol Hill to craft a thoughtful, narrowly tailored piece of legislation. But I persevere.

    Tom Bell argues that technological evolution will likely one day render copyright obsolete. That day cannot come soon enough. The downside of granting intellectual privilege troubles me profoundly, particularly because IP conflicts with other fundamental rights. Still, I see IP as a “necessary evil” today, albeit one that may well eventually become just plain evil.

  • Ryan Radia

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  • http://srynas.blogspot.com/ Steve R.

    Well thank-you for the reply. Yes, defining the extent/scope of the copyright privilege is a legitimate function. Unfortunately it has been improperly morphed into a so-called property right. Nevertheless, its growing irrationality and excess is approaching the Thermidor of the French Revolution. Well almost. To bad that we are unfortunately in disagreement.

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  • http://www.facebook.com/curtis.neeley Curtis Neeley

    WoW comments sound extremely well reasoned.47 USC already requires regulation of the Internet by the FCC and the FCC is malfeasant in not following the law.  It is VERY obvious that the Internet is not regulated by the FCC.  Ny lawsuit has demanded that the FCC be ordered to begin.
    http://www.curtisneeley.com/NameMedia/2011-2558/08_11-2558_Docket_files/2558%20APPEAL%20BRIEF.pdf

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