<http://online.wsj.com/article_print/0,,SB109209577232687104,00.html?mod=opinion> The Wall Street Journal August 10, 2004 REVIEW & OUTLOOK Internet Pirates August 10, 2004; Page A10 If you own a movie or record copyright, and someone else "induces" people to start infringing it, should you be able to sue the inducer? Senator Orrin Hatch thinks so, and it's possible his bad idea could become bad law. Granted, he's trying to address a real copyright problem. Music labels and movie studios are playing a frustrating game of whack-a-mole, with new Internet file-sharing networks popping up faster than the recording industry can protest. The newest networks, including KaZaa and Morpheus, are run as for-profit piracy havens but have found ways to skirt copyright laws. They display advertising on users' desktops but make sure that individual users, rather than anyone in corporate HQ, handle the actual dirty work of infringing copyright. The network operators then claim to be shocked by the illegal activity of individual file traders -- even though they're well aware that their users aren't swapping Shakespeare. Trouble is, the facts don't support the idea that legal action against these network operators would help in the larger fight against piracy. Napster's court-ordered shutdown in 2001 might have been a symbolic triumph over intellectual property theft, but it caused only a minor hiccup in the supply chain for pirated media. The new firms that took its place (the ones that Mr. Hatch's bill targets) are housed outside the U.S., which makes it tough to make them pay a court judgment. Long after they're gone, old copies of their software will allow new swappers to join the party. And even if none of these problems existed, there is already a second tier of file sharing programs like BitTorrent created by hobbyists who don't profit from piracy, and make lean targets for lawsuits. Which brings us to Mr. Hatch's legislation, known as the Induce Act, which gives copyright holders a cause of action to sue anyone who "induces" the violation of their copyrights. While it wouldn't make much of a dent in the Internet piracy problem it's designed to solve, it would unleash a wave of frivolous lawsuits. Makers of technologies ranging from computers and multimedia software to portable music players could find themselves in the crosshairs, on the theory that their wares encourage infringement. Even if the industry's major players showed restraint in using their new power to sue, technology producers would have to contend with the most litigious of copyright holders. Winning such suits, as legitimate technology producers hopefully would, is financially burdensome, especially to startups. The prospect of costly court battles would deter new investments in technology. Mr. Hatch claims his bill would leave in place a Supreme Court ruling that protects the makers of general-purpose technologies from copyright liability. Even if he were right, the conceptual problem with criminalizing tools is inescapable. As long as the necessary legal umbrella protecting technology tools stays in place, the shadier network operators will find a way to shelter themselves under it. The better legal tools to stop file traders are hidden in plain sight, in pre-Internet U.S. copyright law. "Willful" infringement -- when the copier knows, or should know, that he's over the line -- carries a statutory penalty of $150,000 per illegal copy. The content industry can also continue to sue individual pirates. With penalties this high, it doesn't take very many suits to substantially increase the expected cost of pirating an album or film. These suits aren't popular with customers, which is why music and movie companies are asking Congress for other ways of stopping piracy. But it's high time providers and consumers alike bit the bullet and recognized that individual users who pirate content really do deserve steep punishment. That's a better solution than creating more causes of action for the trial bar. -- ----------------- R. A. Hettinga <mailto: rah@ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'