The PRO-IP Act was designed to "strengthen" US intellectual property protections, but opponents of the bill have referred to it as "gluttonous" and overreaching. One of the most controversial bits of the bill was a provision to stop treating compilations of copyrighted works as a single work. This change would mean, for instance, that a music label could seek 10 or 12 times the allowed statutory damages when it prosecutes someone who sells a single copy of an album. For magazines and newspapers which contain a host of separate copyrighted pieces (articles, advertising, etc.), the effects could be even more dire, since a single lost copyright lawsuit could put publishers on the hook for millions and millions of dollars in fines. Today, a House subcommittee removed the controversial provision from the Bill and passed it on to the full committee for further comment.
William Patry, Google's top copyright counsel and the man who literally wrote the book on the subject, said that the compilation change made him "very happy." Public Knowledge head Gigi Sohn, who testified to Congress about the bill's shortcomings late last year, also said in a statement that she was "pleased that the Subcommittee deleted from the bill the section (Section 104) that would have allowed multiplied damages for infringement of a compilation far beyond any reasonable levels."
An argument by copyright owners in defense of the change was that it essentially lowered the value of individual works. If a music company, for example, was able to nail someone for selling 10 songs from 10 different artists, the company could seek the maximum statutory damages ($150,000) and then multiply the amount by 10 ($1.5 million). But if that same petty crook was selling all 10 songs on a single CD, it would be treated as a compilation and the label could only get $150,000.
The standard response to this from digital rights groups is that statutory damages are plenty high already, and that nothing prohibits plaintiffs from seeking much higher amounts of money once they prove actual damages (statutory damages required no proof that the activity in question has harmed the copyright owner).
In their view, removing the statutory limits on damages from compilations could create significant legal uncertainty for companies that use copyrighted content in their operations. Any mistake, even an inadvertent one, that ends up in court could well see a company liable for damages so astronomical that it would simply have to close its doors. The bigger concern is not that this would happen on a regular basis, but that the possibility of it happening was so catastrophic that new companies would be scared off doing anything interesting with copyrighted content.
This argument was actually brought up during a stakeholder roundtable early this year. A US official from the Copyright Office reportedly asked those pushing the change if they could point to a single example from the last several decades in which they had suffered economic harm from the compilations provision. According to reports from those in the room, this led to a significant period of dead air (a claim I heard echoed again last week at a music conference in New York).
The good news here is that Rep. Howard Berman's (D-CA) Subcommittee on Courts, the Internet, and Intellectual Property, actually made the changes in response to work by subcommittee staff, the US Copyright Office, and testimony from hearings. Despite his hostility to several provisions in the bill, Patry concluded that the process worked well, in the end. "Committee staff and the Copyright Office devoted a great deal of attention to the issue and the round table that was held was very well run and very balanced," he noted. "It was government at its best."
Berman took responsibility for making the changes. In his opening statement at the markup hearing this morning, he agreed that the bill "is not perfect" and said that this was why he would be "introducing a managers' amendment today that will address some of the concerns groups have brought to the Subcommittee's attention." Despite Berman's reputation as a big booster of the MPAA and RIAA, he also has a reputation for being willing to listen to other voices and make changes in response to legitimate criticisms. Kudos to him for doing that.
Berman's not necessarily done with the compilations issue, though. He went on to say that the section would be pulled out of "expediency," and said that legislators needed more time to craft a good solution. "There will be ongoing discussions about these issues," he said.