The House of Representatives' attempt to quickly pass a flurry of copyright legislation by tacking numerous provisions onto the Digital Millennium Copyright Act (DMCA) might end up delaying the enactment of the DMCA because of the growing controversy surrounding the last-minute additions.
On August 4, 1998, the House passed the DMCA (H.R. 2281) after adding a number of far-reaching provisions to the core elements of the bill. However, the House is now hearing complaints that it never engaged in meaningful debate about the merits of those additions. The core of the DMCA resembles its counterpart bill in the Senate (S. 2037) -- both implement treatises adopted by the World Intellectual Property Organization by, among other things, restricting the use of decrypting devices to undermine protected works, limiting the liability of Online Service Providers and permitting the copying of computer programs when repairing a computer. However, the following notable additions to the DMCA have created considerable controversy and are likely to be the subject of numerous Congressional and industry-wide debates for at least the remainder of 1998.
Creation of Rights in Databases
By restricting a third party's use "of a collection of information gathered, organized, or maintained by another person through the investment of substantial monetary or other resources," Title V of the DMCA (originally H.R. 2652) may create a heretofore-unrecognized intellectual property right in databases ("collection of information" is broadly defined). The Department of Commerce has expressed serious doubts about the constitutionality of this provision. Title V is controversial also because it would undermine a unanimous Supreme Court decision that copyright protections should not be extended to items such as databases. Feist Publications v. Rural Service Telephone Corp., 499 U.S. 340 (1991). A coalition of 38 organizations including the American Committee for Interoperable Systems, AT&T Corp. and Yahoo Inc. recently sent a letter to various Senators urging a more thorough review of this matter before any legislation is passed.
Discouraging New Internet Broadcasting Companies
Section 415 of the DMCA would amend previous legislation and clear the way for new companies that provide digital audio services to be subject to higher licensing fees, while protecting existing companies from the new fee structure. The Digital Future Coalition, an organization that represents the interests of both copyright holders and users, argues that Section 415 would erect barriers for companies such as new Internet music providers and broadcasters while protecting the market for companies that already exist. As a result, the growth of the market for digital audio services may also be impeded in favor of cable-based delivery. The recording industry, which would benefit from the higher fees imposed by this provision, argues that Section 415 restructures licensing fees in a way that is long overdue.
Narrowing of the Fair Use Doctrine
Section 414 of the DMCA deletes certain language from the "fair use" provision of the 1976 Copyright Act that expressly allows the photocopying or taping of copyrighted works for educational and certain other non-commercial purposes. Proponents of deleting the language argue that the deletion is merely a clarifying change, but opponents fear that educators and consumers will see their traditional fair use rights narrowed.
INTERNET COMPANIES SEEK PATENTS TO PROTECT BUSINESSES
It is not surprising that the proliferation of the Web has led numerous Internet companies to seek patents for software or other unique processes that they have created. Accordingly, the United States Patent and Trademark Office has recently awarded a number of patents relating to the Internet. At some point, it is possible that competition will be stifled by an increasingly large number of Internet processes that become patented, and by an increasingly vigilant body of patent holders seeking to enforce their newfound rights. For now, however, the field seems to be relatively wide open.
Creators most commonly apply for a "utility" patent, which protects the way an article is used in works. A "design" patent, which protects the way an article looks, can also be sought, sometimes in conjunction with a utility patent.
On August 11, 1998, a California-based company was awarded a patent for a search process that utilizes "common sense reasoning" rather than keywords or phrases (Patent No. 5,794,050). On the same day, CyberGold Inc. was awarded a patent for a creation dubbed "attention brokerage," whereby advertisers bid for Internet users' attention by offering compensation and incentives to users that click on the advertisement (Patent No. 5,794,210). Also in the realm of Internet advertising, Flycast Communications Corporation announced that it was awarded a patent for an advertising system that tailors the advertising campaign to the unique properties relating to the user, and Netcentives Inc. was awarded a patent for a system of online rewards programs (Patent No. 5,774,870).
Although Internet processes such as the foregoing are being actively patented, there has not been a similar movement to patent the "look and feel" (i.e. graphical user interface) of web sites, even though many sites attribute their success to the "look and feel" aspect of their web pages. The reason may lie in the difficulty of patenting an entire web site -- while certain parts of the site such as icons may be protected by design patents, other functional aspects of the site may not. Moreover, there have been no firm legal pronouncements in the U.S. that the "look and feel" of a web site is fully copyrightable. However, an interesting French case in late 1997 held that Cybion, a company offering Internet intelligence services, had a copyright interest for collective works in its web site, and ordered damages paid by Qualistream, a company that copied that Cybion site wholesale.
GORE ANNOUNCES ELECTRONIC BILL OF RIGHTS
Hot on the heels of the Federal Trade Commission (FTC) report in June denouncing the current state of online privacy and hinting at imminent government intervention, Vice President Al Gore recently announced an "Electronic Bill of Rights" to safeguard privacy in the digital age.
The Electronic Bill of Rights seeks to protect a wide range of personal information, including medical and financial records, as well as the online privacy of children and consumers online. The principles underlying the Electronic Bill of Rights closely track the principles promoted by the FTC report - Gore announced that people "should have the right to choose whether [their] personal information is disclosed, . . the right to know how, when and how much of that information is being used, . . . the right to see that information, . . . [and] the right to know if it's accurate, and correct it if it isn't."
Given all the attention on online privacy, companies seeking to conform their business practices to government recommendations and Internet-related legislation should place privacy policies at the top of their list. Even though companies should be expedient in making sure that their web sites contain a clear and easily accessible statement regarding their privacy policy, they should first conduct thorough audits of their internal procedures to ensure that the privacy policies that are being posted on the web site are in fact accurate.