July 18, 1997 1:40 PM PDT

Bill to take ISPs off copyright hook

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Internet access providers would not be responsible for software pirates or copyright thieves who break the law using their services if a bill introduced yesterday in the House of Representatives becomes law.

Rep. Howard Coble (R-North Carolina) and Rep. Henry Hyde (R-Illinois) are pushing the Online Copyright Limitation Liability Act, which exempts online services and ISPs from liability for copyright violations on their networks if the companies don't know about the illegal activity and never benefit financially from the acts.

Services can also skirt responsibility for linking to pirated material unless it's proven in court that the links were actual endorsements of the illegal material. The bill also says companies shouldn't have to police their customers' activity. "A red flag should not be ignored, but a provider should not ordinarily be required to go out and search for red flags," Coble's analysis of the bill states.

For businesses such as America Online, the bill's passage would be good news because they wouldn't be accountable for customers' deeds, something they face now. "Under current law, a person is liable for direct infringement..with or without knowledge of infringement," the analysis states.

During the World Intellectual Property Organization's December conference in Geneva, Switzerland, ISPs, the American Library Association, and telephone companies also fought a international treaty provision that would have forced them to police patrons or customer activities for copyright violations because it held them responsible for all infringements over their services. The treaty was changed by the 157 global delegates at the last minute, a victory for Net access providers.

But the proposed bill is not gaining kudos in all corners of the online industry. Software publishers fear its passage will lead to more illegal copying and distribution of their products, which means lost profits. In addition, companies may not want to sell products online if their copyright protections are weakened.

"This is bad for e-commerce because companies will be reluctant to put their best software on the Net," said Mark Traphagen, vice president of government affairs for the Software Publishers Association, one of the largest software industry trade associations with more than 1,200 members.

"Current law in some circumstances holds online providers liable and provides an incentive for online providers to use responsible business practices," added Traphagen. "This change will let them to turn their head away when they know piracy is going on. Now, we just have to prove that illegal copying took place. This legislation means we have to prove that services profited from it or had knowledge...This is impossible on the Net."

The bill's authors designated Rep. Bob Goodlatte (R-Virginia) to conduct meetings with service providers and intellectual property rights owners to negotiate further terms of the bill. Goodlatte conducted similar meetings last summer.

 

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