Senators Leahy, Specter, Bayh, and Voinovich Introduce Intellectual Property Rights Enforcement Legislation
July 24, 2008
CONTACT: Office of Senator Leahy, 202-224-4242
WASHINGTON (Thursday, July 24, 2008) – Leading advocates in the Senate today will introduce legislation to protect American innovation and address intellectual property rights enforcement.
The Enforcement of Intellectual Property Rights Act of 2008 will be introduced in the Senate by Judiciary Committee Chairman Patrick Leahy (D-Vt.) and Ranking Member Arlen Specter (R-Pa.), and is co-sponsored by Sens. Evan Bayh (D-Ind.), George Voinovich (R-Ohio). Senators Dianne Feinstein (D-Calif.) and John Cornyn (R-Texas) are also cosponsors of the bill.
In a press conference on Capitol Hill, Leahy, Specter, Bayh and Voinovich highlighted key aspects of the legislation, which reflects a measured compromise of a number of intellectual property proposals introduced during this Congress. Key among the legislation’s components are: authorization for the Attorney General to enforce civil copyright laws; enhancements to civil intellectual property laws; enhancements to criminal intellectual property laws; coordination and strategic planning of federal efforts against counterfeiting and piracy; and increased resources for key programs within the Department of Justice to combat intellectual property theft.
“The protection of intellectual property is vital to our economy,” said Leahy. “The value of invention and innovation can be seen in so many Vermont-made products. The time has come to bolster the Federal effort to protect this most valuable and vulnerable property, to give law enforcement the resources and the tools it needs to combat piracy and counterfeiting, and to make sure that the many agencies that deal with intellectual property enforcement have the opportunity and the incentive to talk with each other, to coordinate their efforts, and to achieve the maximum effects for their efforts. This bill does just that.”
“With intellectual property contributing over $5 trillion to our national economy, it is one of our most valuable assets and we must protect it,” Specter said. “This bill gives our government the additional tools that it needs to do just that by enhancing the civil and criminal penalties for intellectual property violations and discouraging criminal organizations from entering the business of counterfeiting and piracy.”
“The global economy is not working as it should when we buy from countries that have a competitive advantage over us, and they steal from us when we have a competitive advantage over them,” Bayh said. “American businesses lose $250 billion every year, and we have lost more than 750,000 jobs because of intellectual property theft. The American auto industry estimates it could hire an additional 200,000 workers if we eliminated the trafficking of counterfeit auto parts. If hundreds of our cargo ships were being hijacked on the high seas or thousands of our business people were being held up at gunpoint in a foreign land, there would be a great sense of alarm and unshakable government resolve to act. That, in effect, is what is happening today, yet we are not doing nearly enough to stop it.”
“In the fierce competition of the 21st-century global marketplace, intellectual property is one of the few areas where America has a clear advantage over foreign competitors. It is vital that we protect that advantage, level the playing field and ensure continued economic growth for Americans,” Voinovich said. “This vital legislative is a critical step toward safeguarding the economic health of our country by improving the management, coordination and effectiveness of our nation’s intellectual property enforcement efforts.”
The bill’s cosponsors have introduced several intellectual property related legislative proposals in the 110th Congress. The bill is expected to be referred to the Senate Judiciary Committee.
Statement Of Senator Patrick Leahy (D-Vt.),
Chairman, Senate Judiciary Committee,
On The Enforcement Of Intellectual Property Rights Act Of 2008
July 24, 2008
Before I was a Senator, I was a prosecutor. As the Chittenden County State’s Attorney for eight years, I prosecuted all varieties of crime in Vermont. I know first hand how important it is for criminal investigators, and the lawyers who prosecute those cases, to have a full arsenal of legal tools to ensure that justice is done. I also know how important the intellectual property industries are to our economy, and to our position as a global leader. In Vermont, Hubbardton Forge makes beautiful, trademarked lamps. The Vermont Teddy Bear Company relies heavily on its patented products. Likewise, SB Electronics needs patents for its film capacitor products. Burton’s snowboards and logo are protected by trademarks and patents.
While Vermont is closest to my heart, every state in the Nation has such companies, and every community in the United States is home to creative and productive people. Intellectual property – copyrights, patents, and trademarks – is critical to our fiscal health and to our continuing dominance of the world economy. This valuable property is also terribly vulnerable; by its very nature, it is subject to numerous types of thievery and misappropriation. The Internet has brought great and positive change to all our lives, but it is also an unparalleled tool for piracy. The increasing inter-connectedness of the globe, and the efficiencies of sharing information quickly and accurately between continents, has made foreign piracy and counterfeiting operations profitable in numerous countries. Americans suffer when their intellectual property is stolen, they suffer when those counterfeit goods displace sales of the legitimate products, and they suffer when counterfeit products actually harm them, as is sometimes the case with fake pharmaceuticals and faulty electrical products.
The time has come to bolster the Federal effort to protect this most valuable and vulnerable property, to give law enforcement the resources and the tools it needs to combat piracy and counterfeiting, and to make sure that the many agencies that deal with intellectual property enforcement have the opportunity and the incentive to talk with each other, to coordinate their efforts, and to achieve the maximum effects for their efforts. The Enforcement of Intellectual Property Rights Act of 2008 does just that.
First, it gives the Department of Justice the ability to bring civil actions against anyone whose conduct constitutes criminal copyright infringement. Many times, a criminal sanction is simply too severe for the harm done. This provision, the concept of which has passed the Senate on three separate occasions as the PIRATE Act, gives the Department of Justice an extra tool.
Second, the bill enhances civil intellectual property rights law by eliminating unnecessary burdens to instituting a suit; improving remedies; and applying the copyright and trademark laws not only to imported goods, but also to exported and transshipped items.
Third, the bill improves and harmonizes the forfeiture provisions in copyright and counterfeiting cases.
Fourth, the bill addresses concerns that the current governmental structure to coordinate intellectual property rights enforcement among agencies and departments is impeding the Government from reaching its full potential. It creates a Coordinator within the Executive Office of the President to chair an inter-agency committee that will produce a Joint Strategic Plan to combat piracy and counterfeiting.
Finally, the bill will increase the resources available to Federal, state and local law enforcement.
We are not addressing theoretical concerns with this bill, nor are we making grandiose policy proclamations. We are synthesizing the real-world experiences of our many constituents who develop and monetize intellectual property – the individuals and companies that turn their creative and innovative efforts into jobs, goods, and services – with the daily frustrations of law enforcement agents who lack the laws, and the resources, to vindicate those property rights.
I was once a prosecutor. I am now a Senator. But I have always been a fan of movies. My cameo in the latest Batman movie, The Dark Knight, was priceless to me, but we can put real numbers on the value of that production to the economy. The Dark Knight shot for 65 days in Chicago, pouring almost $36 million into the local economy. Seventeen million dollars went to nearly 800 local vendors that were critical to the production of the movie. For example, one local lumber supplier employing 40 people played a central role in the set construction that helped transform Chicago into the mythical “Gotham City.” In order to fulfill the production needs of the film, the lumber company worked closely with 15 other Illinois-based companies. Those 15 suppliers employed an additional 350 workers.
All of that value is threatened by piracy. Just in the movie industry, piracy costs 140,000 U.S. jobs and $5.5 billion in wages each year. Piracy costs cities, towns and states an estimated $837 million in additional tax revenue each year. The movie industry alone produces $30.2 billion each year in revenue for 160,000 vendors all across the Nation, and 85 percent of those vendors employ 10 people or fewer.
This is a well balanced bill, drawn from numerous conversations with all manner of interested parties. It brings together the best of numerous proposals, including important legislation I introduced earlier this year with Senator Cornyn. His support on intellectual property matters is critical to our success moving forward. I thank him, and all the cosponsors of this legislation for their efforts and support. This bill will improve the enforcement of our Nation’s intellectual property laws, bolster our intellectual property-based economy, and protect American jobs.
I ask unanimous consent that the full bill text be included in the Record.
Enforcement of Intellectual Property Rights Act of 2008
Title I – Authorization of Civil Copyright Enforcement by Attorney General. Currently, the Justice Department cannot bring civil actions against copyright infringers, but many times a criminal sanction is simply too severe for the harm done. This title gives the Attorney General authority to bring civil actions against anyone whose conduct constitutes criminal copyright infringement. The language of this section is substantively similar to Senator Leahy’s PIRATE Act, which has been passed three times by the Senate already.
Title II – Enhancements to Civil Intellectual Property Laws. This title enhances civil intellectual property rights law by eliminating unnecessary burdens to instituting a suit; improving remedies; and applying the copyright and trademark laws not only to imported goods, but also to exported and transshipped items. More specifically, it amends the Copyright Act so that registration of a copyrighted work is a requirement before bringing a civil infringement suit, but not a criminal one. It also creates a new “harmless error” provision so that an infringer cannot escape liability just because a registration certificate for an infringed work has an inadvertent error in it. This title also allows seizing documents and records in civil infringement actions concerning the manufacture, sale, or receipt of things involved in those violations. It ensures, in both the Copyright Act and the Trademark Act, that courts can enter appropriate protective orders with respect to discovery. As for penalties, this title provides for treble damages not only for those who intentionally use a counterfeit mark, but also for those who intentionally supply goods or services necessary to a violation of the Trademark Act. It also doubles the statutory damages in trademark counterfeiting cases to a range of $1000 to $200,000 for use of a counterfeit mark, and to $2,000,000 for willful use of a counterfeit mark.
Title III - Enhancements to Criminal Intellectual Property Laws. This title harmonizes the forfeiture provisions that apply in cases of criminal copyright infringement with those concerning trademarks for counterfeit documentation or packaging, unauthorized fixation of live musical performances, unauthorized recording of motion pictures, trafficking in counterfeit goods or services, and violations of the Economic Espionage Act. The general forfeiture provision is also improved in two ways: it does not permit forfeiting property used in an offense unless it is owned or predominantly controlled by the violator or a conspirator, and it requires the government to establish a substantial connection between the property and the violation. In addition, this title enhances the maximum statutory penalties for counterfeiting offenses that endanger public health and safety. It increases maximum penalties for trafficking in counterfeit goods or services from 10 to 20 years imprisonment for knowingly or recklessly causing serious bodily injury, and to life imprisonment for knowingly or recklessly causing or attempting to cause death.
Title IV – Coordination and Strategic Planning of Federal Effort Against Counterfeiting and Piracy. This title responds to concerns that the current structure within the Government to coordinate enforcement of intellectual property rights is ineffective and inefficient. It creates an advice-and-consent level position, the Intellectual Property Enforcement Coordinator (IPEC), to serve in the Executive Office of the President and chair an inter-agency committee, that will produce and implement a joint strategic plan to enforce intellectual property laws. The committee will comprise the IPEC and Senate-confirmed representatives of the Office of Management and Budget, the Department of Justice, the United States Patent and Trademark Office and other relevant units of the Department of Commerce, the Office of the United States Trade Representative, the Department of State, the United States Agency for International Development, the Bureau of International Narcotics Law Enforcement, the Department of Homeland Security, United States Customs and Border Protection, United States Immigration and Customs Enforcement, the Food and Drug Administration of the Department of Health and Human Services, the United States Copyright Office, and any other agencies the President names.
Title V – Department of Justice Programs. This title increases the resources available to federal and local law enforcement agencies to combat theft of intellectual property. It creates grants for state and local law enforcement, and it creates an operational unit within the FBI to fight intellectual property crimes. It requires a comprehensive training program on intellectual property offenses at the Department of Justice, and establishes an Organized Crime Task Force at Justice to study organized crime relating to intellectual property theft. It authorizes funds for the FBI and DOJ to hire and train additional agents and prosecutors to investigate and prosecute intellectual property crimes, and requires the Attorney General to send five “intellectual property law enforcement coordinators” to the countries or regions where there presence and assistance can have the greatest positive effect on US intellectual property rights and interests.
Photo of Sen Leahy by musicFIRSTcoalition.