Rep. Issa and Others Propose USITC Based Approach to Web Sites Dedicated to Infringing Activity

December 14, 2011. Rep. Darrell Issa (R-CA), Rep. Zoe Lofgren (D-CA), Sen. Ron Wyden (D-OR), and others have announced, but not yet introduced, a competing bill to be titled "Online Protection & Enforcement of Digital Trade Act". This title provides a near acronym -- "OPEN Act". See, draft [18 pages in PDF].

Their summary of the draft states that their proposal would give new authority to the U.S. International Trade Commission (USITC) to deal with rogue foreign web sites.

The summary states that the USITC is already "an arbiter of whether imports violate U.S. intellectual property rights and should or should not be allowed into the U.S. Under current law, rightsholders can petition the ITC to investigate whether certain imports violate U.S. trademarks and copyrights. The ITC is authorized to not only investigate these issues but to initiate actions to prevent the imports in question from entering into the U.S."

It elaborates that "Under our proposal, the ITC would be authorized to initiate an investigation at a rightsholder's request and issue a cease-and-desist order against foreign websites that provide illegal digital imports and/ or facilitate the importation of counterfeit goods. In order to issue such an order, the ITC would need to find that the foreign website is ``primarily´´ and ``willfully´´ engaging in infringement of U.S. copyrights or willfully enabling imports of counterfeit merchandise. This standard comports with existing copyright and trademark law. An ITC cease-and-desist order would, under this proposal, compel financial transaction providers and Internet advertising services to cease providing financial and advertising services to the foreign website."

It also states that "respondents would have a right to be heard", but that the USITC could issue emergency ex parte orders.

It also proposes "immunity for those entities that are complying with the ITC orders, including financial transaction providers and Internet advertising services that voluntarily refuse to provide services to foreign websites that endanger public health by supplying illicit prescription drugs."

The draft bill provides that "It shall be unlawful to operate or maintain an Internet site dedicated to infringing activity."

Then, if the USITC "determines ... that an Internet site dedicated to infringing activity is operated or maintained in violation" of this prohibition, the USITC may "issue an order to cease and desist the infringing activity of the Internet site against the Internet site and to the owner and the operator of the Internet site".

The draft also provides that a "financial transaction provider shall take reasonable measures, as expeditiously as reasonable, designed to prevent or prohibit the completion of payment transactions by the provider that involve customers located in the United States and the Internet site associated with the domain name subject to the order ..."

Also, "an Internet advertising service shall, as expeditiously as reasonable, take technically feasible measures intended to cease serving advertisements to the domain name subject to the order ... in situations in which the service would directly share revenues generated by the advertisements with the operator of the Internet site associated with that domain name."

The draft contains numerous immunity provisions for intermediaries. For example, "No cause of action shall lie in any court against a financial transaction provider or an Internet advertising service on which a copy of an order is served ... or against any director, officer, employee, or agent thereof, other than in an action ... for‚ (i) any act reasonably designed to comply with this subsection or reasonably arising from the order; or (ii) any act, failure, or inability to meet the obligations under this subsection of the provider or service if the provider or service, as the case may be, makes a good faith effort to comply with such obligations."