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Copyright Law Enters the Digital Age

On October 28, 1998, the Digital Millennium Copyright Act (DMCA) became law. With the exception of a provision for the expansion of protection in databases, which failed to pass, the DMCA harmonizes U.S. Copyright law with the 1996 World Intellectual Property Organization (WIPO) Treaty and the WIPO Performances and Phono-grams Treaty.

Titles I and II of the DMCA address copyright issues raised by the advent of digital technology and the need to control the copying of protected works via on-line transmission.

Title I of the DMCA is designed to prevent the circumvention of technologies used to control access to copyrighted works (e.g., encryption, scrambling, digital certificates, etc.). Title I prohibits the manufacture, sale, or importation of any device primarily designed to circumvent these technologies. A broader provision prohibiting the actual circumvention of the technologies will take effect on October 28, 2000.

There are several exceptions to these prohibitions, including exceptions for libraries, educational institutions, law enforcement, security testing, and encryption research, as well as an exception allowing counter-actions against technologies designed to surreptitiously collect information about on-line activities (e.g., the ubiquitous "cookies" found on many Internet websites).

Another exception enables the lawful purchaser of a computer program to circumvent technologies used to control access to portions of the purchased program if his purpose is to analyze portions of the program necessary to achieve interoperability with other computer programs.

Title I of the DMCA also prohibits the manufacture, sale and importation of various recording devices, including camcorders and VCRs, that do not conform to industry standards for preventing unauthorized copying of copyrighted works. This prohibition will become effective on April 28, 2000.

Violating any of the prohibitions of Title I may subject the violator to damages, including a loss of profits, and to criminal penalties if the violation is willful.

Although not required by international treaty, Title II of the DMCA addresses the liability of Internet service providers (ISPs) for copyright infringement resulting from their transmission or storage of copyrighted works and their establishment of links to Internet sites that contain copyrighted works. Title II exempts ISPs from copyright infringement liability if they satisfy certain conditions. Among these conditions are that ISPs not modify the work in any manner, that ISPs comply with industry standards or protocols for transmission and storage, and that ISPs remove infringing materials expeditiously upon notification of a claimed copyright infringement. Further, ISPs are required to designate an agent to receive notifications of claimed infringement. Information about the agent must be provided to the Copyright Office and posted in a publicly accessible place such as the ISP's Internet website.

Ironically, an online provider who does not monitor the content of its transmissions may escape liability, but may incur liability if it performs such monitoring. However, this paradox existed prior to the DMCA and is a necessary corollary to the rule that persons are not contributorily liable where they have no opportunity to control or prevent the infringement.

To implement the WIPO Performances and Phono-grams Treaty, the DMCA grants copyright protection to sound recordings first made in the United States or another treaty party and to pictorial, graphic and sculptural works incorporated in a building or other structure or an architectural design embodied in a building located in the United States or another treaty party. Works published in the United States or a treaty party within 30 days after publication in a nation which is not a treaty party are deemed to be first published in the United States or a treaty party for purposes of granting protection.

Other titles in the DMCA include an exception from copyright infringement liability for computer maintenance and repair (discussed elsewhere in this newsletter), a compulsory licensing and royalty distribution scheme for the transmission of copyrighted music on the Internet and a new form of intellectual property right in the original design of boat hulls.

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