Government Officials and Industry Representatives Clash Over Enforcement of Intellectual Property Rights in Cyberspace

(November 29, 2000) Government officials responsible for enforcing intellectual property laws, and representatives of intellectual property owners, held a public meeting at which they discussed law enforcement activities in cyberspace. Industry representatives criticized the lack of prosecutions by the U.S. Department of Justice.

The event was a public meeting of the National Intellectual Property Law Enforcement Coordination Council (NIPLECC), which was created by the Treasury/Postal appropriations bill that was signed into law on September 29, 1999. It is due to write a report to Congress on intellectual property rights (IPR) law enforcement in January of 2001.

Todd Dickinson

Todd Dickinson, chief of the USPTO, and Co-Chairman of the group, stated that "one of our principal focuses now ... is working to protect intellectual property in the digital age. Now, this presents new, substantial challenges."

"This is a very difficult time for industries," Dickinson added, "that are ravaged by electronic crime on the Internet."

The government officials spoke first, and reviewed the extent of their agencies' activities regarding intellectual property rights enforcement. Most stated that they are interested and active, and training their personnel, conducting studies, and liaising with their counterparts in foreign governments.

After these statements, the government officials posed for a group photograph. Kevin DiGregory, Deputy Assistant Attorney General at the Criminal Division at the U.S. Department of Justice, and the official most responsible for criminal enforcement of violations of intellectual property rights statutes, was present to make an opening statement, and to pose for photographs. However, he walked out of the meeting before listening to industry comments.

His efforts were roundly condemned by members of the industry panel.

DiGregory said in his opening statement that the Department of Justice is involved in four ways. It has brought prosecutions under counterfeiting statutes, under the Economic Espionage Act, and under the No Electronic Theft Act; it is "enhancing training"; it has urged the "amendment of sentencing guidelines"; and it is involved in "industry outreach".

Maria Strong, of the International Intellectual Property Alliance, stated that there is an "urgent need for more effective prosecution ... at the federal level."

Robert Kruger, of the Business Software Alliance, rebutted DiGregory's assertions. He stated that there "is a critical need for increased law enforcement against copyright pirates on the Internet" and that the "domestic law enforcement response, in our view, is underwhelming." He stated also that "there have been less than a handful of public prosecutions following the transmission of an infringing software, or other digital works, on the Internet."

Kruger also condemned government's failure to speak out to the public on this topic. "There is a raging debate -- a highly public debate -- over whether copyright infringement on the Internet is wrong, whether anybody cares, whether there are any meaningful consequences. We regularly hear from consumers and the creative community ... but largely missing from the debate -- one of the strongest influencers of public opinion -- is the constables."

Maxim Waldbaum, of the INTA, argued that civil actions by intellectual property owners are an ineffective deterrent to pirates. He added that even criminal prosecutions that do not include incarceration are ineffective. He argued for sentences that include jail time.

Several witnesses offered other suggestions, in addition to more prosecutions. For example, Stevan Mitchell, of the Interactive Digital Software Association, commented that the defense and intelligence agencies have become involved in anti-drug efforts, and suggested that they also provide intelligence on intellectual property violations.

Raymond Kelly, Commissioner of the U.S. Customs Service, stated that his agency screens goods coming across U.S. borders for counterfeiting. He also stated that the Customs Service has formed a group to address intellectual property rights online.

He continued that in FY 1997 through FY 1999 "the Customs Service made over 9,000 IPR seizures worth more than 228 Million Dollars." It also conducted over 1,500 investigations resulting in 209 arrests, 172 indictments, and 188 convictions. He further estimated that the value of IPR seizures in FY 2000 will be around $100 Million.

The efforts of the Customs Service were praised by several industry speakers.

Other government panelists addressed the roles of their agencies. Marybeth Peters, the Register of Copyrights, pointed out that "we really have no law enforcement obligations." John Desrocher of the USTR reviewed the Special 301 process. Wayne of the State Department stated that U.S. embassies and consulates help conduct "on the ground assessment" in foreign countries. However, he acknowledged that most of the State Department's information comes from private industry.

In addition to the industry representatives, one member of the public stood up to ask a question. He stated that he was planning to start a technology company, but was concerned that there will be little protection globally for intellectual property rights in 30 years. Sandra Bell of the Customs Service stated that her agency had enforced the laws for 200 years, and will still be doing so in 30 years. However, he received little encouragement from the other government officials.

There was one light moment at the hearing. At one point Maria Strong referenced her desire to work with a government agency. Todd Dickinson interrupted to inquire whether she meant that she desired to work with multiple government agencies. This led Robert Kruger to quip, "We should be so lucky as to have two government agencies wanting to pursue the same pirate."

The meeting was held in the Auditorium of the U.S. Department of Commerce on Monday afternoon, November 27. In addition to the government and industry panelists, there were about 50 other persons present.