Commentary Forum Center, 2/7/12

SOPA, PIPA, and Policing Internet Piracy

Online piracy costs U.S. copyright owners and producers billions of dollars every year, but legislation in Congress to block foreign Internet thieves and swindlers has met strong resistance from high-tech companies. There’s a strong argument that more needs to be done to protect artists, innovators and industries from copyright thieves.  There is also a need to shield consumers from products sold on the Internet that are fake, faulty and unsafe. Creative America, a coalition of Hollywood studios, networks and unions, says content theft costs U.S. workers $5.5 billion a year. The pharmaceutical industry loses billions to Internet sellers of drugs that are falsely advertised and may in some cases be harmful.

The two main bills dealing with the topic are the Protect Intellectual Property Act, or PIPA, in the Senate, and the similar Stop Online Piracy Act, or SOPA, in the House. While there are already laws on the books to combat domestic websites trafficking in counterfeit or pirated goods, there was no effective legislation to counter foreign violators.

As these bills were being considered in Congress, a large internet protest sprang up in opposition. Critics say they would constrain free speech, curtail innovation and discourage new digital distribution methods. In addition, critics contend that developing businesses and smaller websites could be saddled with expensive litigation costs.

The bills would allow the Justice Department and copyright holders to seek court orders against foreign websites accused of perpetrating or facilitating copyright infringement. While there is little the United States can do to take down those websites, the bills would bar online advertising networks and payment facilitators such as credit card companies and PayPal from doing business with an alleged violator. It also would forbid search engines from linking to such sites.

A group of leading Internet and technology companies argue that they could be forced to pre-screen all user comments, pictures and videos — effectively killing social media. Search engines, Internet service providers and social networks could be forced shut down websites linked to any type of pirated content.

Many legislators now have backed away from support of PIPA and SOPA. There is concern that the legislation would have the effect of reducing freedom of expression and undermining the dynamic, innovative global Internet. Both of these bills would now appear to be dead in the water.

In a related story, the Department of Justice announced Thursday that it has conducted a major action to shut down MegaUpload, a popular file-sharing site widely used for free downloads of movies and television shows. In January, MegaUploadwas indicted by a grand jury in Virginia for racketeering conspiracy, conspiracy to commit copyright infringement and other charges.  Federal authorities arrested four people and executed more than 20 search warrants in the U.S. and eight foreign countries, seizing 18 domain names and an estimated $50 million in assets, including servers run in Virginia and Washington, D.C.

MegaUpload is a “digital locker” that allows users to store files that can then be streamed or downloaded by others. Its subsidiary site, MegaVideo, became very popular for the unauthorized downloads of movies and TV shows. Users whose uploaded content proved particularly popular were paid for their participation.

Forum Questions of the Week:

What role should government play in policing virtual information, and to what extent is the government responsible for punishing those (i.e. MegaUpload) implicit in illegal internet uploads?

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