Infotech Lobbies Against Patent Chief

An industry-led coalition wants to derail portions of a pending international agreement regarding digital copyrights, saying it could stack the deck against them during 1997 congressional debates on cyberspace property rights.

Industry executives are lobbying the White House via letters and meetings because "almost none of us thought we could convince Bruce" that his intellectual property policies will tilt the balance of legal rights toward the copyright owners and away from infotech companies and citizens, said Ed Black, president of the Computer and Communications Industry Association.

Such an imbalance would undermine the infotech industry's growth and curb citizens' access to information, said Black, who is working with the Digital Futures Coalition, a group of online and telecommunications companies lobbying against Lehman's proposals.

One reason for urgency, Black said, is fear that Lehman will try to write his policies into the international Berne Convention on copyrights, due to be updated with computer-related policies in December.

"Until [Lehman] hears something different from the administration, he'll continue down the path he's going," said Carolyn Breedlove, a senior lobbyist at the powerful National Education Association, which opposes Lehman's policies. The Clinton administration's plans to upgrade the nation's schools with computer and Internet technology will be stymied by the high cost of meeting stringent copyright rules required by Lehman's policies, she said.

Lehman said he has tried to balance the demands of the communications companies with the demands of the companies that own copyrighted products. "[One side] is attempting to use the [international] talks to jockey for position" in domestic discussions on liability, said Lehman.

"There are only two people higher than me in the administration," and there's no sign that either President Bill Clinton or Commerce Secretary Mickey Kantor are rethinking their support for the current policies, Lehman said.

"We don't think anyone in the White House is aware" of the threat posed by Lehman's policies, which are strongly supported by the influential movie and music industries, said CCIA's Black, who believes it would be almost impossible to use U.S. legislation to make changes in Berne Convention related policy.

"Postponement of the debate until 1997 is probably the best thing, because this is a very complex issue," NEA's Breedlove said. The NEA has 2.2 million members, many of whom are active in the Democratic Party.

"Our coalition is hopeful that when major California companies team with serious and substantial private sector organizations, including the NEA, that senior members of the administration will recognize there are serious, substantive issues that can be resolved [in the United States] before a rush to international judgment is made" in Berne, said Adam Eisgrau, Washington lobbyist for the American Library Association, which is part of the Digital Futures Coalition.

"It is going to be a tough fight," said Black.

The Digital Futures Coalition and a parallel alliance of companies called the Ad-Hoc Copyright Coalition, are against Lehman on two critical issues: How much responsibility online companies should be given for preventing copyright violations conducted via their networks, and whether computerized databases should be protected under a new law, rather than the existing copyright law.

These anti-Lehman groups are opposed by the movie and music industries, which fear their copyrighted products will be pirated via the Internet. These industries, led by the Motion Picture Association of America, the Newspaper Association of America and the Information Industries of America, have funded the Washington-based Creative Incentive Coalition to lobby for their cause. Copyrighted products account for $238 billion in annual revenue and help employ 3 million people, according to John Raffetto, a spokesman for the coalition.

In their appeal to the White House, Lehman's opponents are hoping to cut his liability and database proposals out of the impending Berne agreement on copyrights, giving the infotech industry time to win support in Congress.

Online companies such as America Online Inc., Dulles, Va., and CompuServe, Columbus, Ohio, are particularly concerned about the liability issue, which they say will entangle them in lawsuits every time a copyrighted product is surreptitiously transmitted via their networks. They are backed by the phone companies, which have announced plans to offer Internet service to their many customers, and by some companies that plan to electronically distribute their copyrighted information.

Telecommunications companies "can provide any kind of service they want. They just have to do it responsibly," said the Creative Incentive Coalition's Raffetto. The copyright owners need the cooperation of the online companies "in a minimal way. We are not asking that they open people's e-mail," Raffetto said.

To help broker a compromise, Rep. Bob Goodlatte, R-Va., sponsored industry negotiations on the liability issue during the summer. But the two sides couldn't arrive at a compromise because the online firms "went for an all-or-nothing strategy," said Raffetto. "They saw this legislation as their chance of getting out of being liable.... They tried to wash their hands of it," he said.

After the breakdown of those negotiations, Lehman recently started another round of negotiations, raising suspicion among the telecommunications companies that he will try to make them liable for significant violations of copyrighted product. Online companies "have managed to slow down the progress of this much-needed legislation," said Lehman.

Lehman said his newest proposal is "totally fair. That doesn't mean it can't be improved."

Copyright owners would gain increased protections, while telecommunications and online companies would gain "a cleaner, less open-ended liability," he said.

Communications companies that simply provide a communications conduit for customers cannot be held liable for copyright infringements, but companies that link customers, bulletin boards and World Wide Web pages "should not be immunized for [copyright] violations at all," he said.

However, online companies have complained about Lehman's latest proposal. "It is definitely a step backward" from the Goodlatte language, said Brian Ek, a spokesman for Prodigy Services Co., an online company based in White Plains, N.Y.

Also, the Patent Office has no plans to bring up the liability issue during the Berne negotiations, which are hosted by the multinational World Intellectual Property Organization, he said.

But Lehman's diplomatic proposals at Berne will require Congress to settle the liability issue in 1997, said Eisgrau. The proposals to be debated at the Berne Convention include a measure extending copyright protection to intellectual property sent via networks, effectively requiring Congress in 1997 to draft legislation -- such as liability rules -- that implement the Berne decision inside the United States, he said.

And once the Berne rules are in place, the United States won't be able to buck the international tide, said Black.

On a second front, Lehman is against some of the members of the DFC coalition over copyright protection for databases. Lehman has proposed a provision at the Berne negotiations creating a new legal framework intended to protect databases from being copied by commercial rivals. The provision is strongly backed by the Washington-based Information Industries Association, a group of major copyright-owning companies such as newspapers, software and online companies.

Eisgrau and others object to this provision, saying it will hinder the free flow of information to citizens, schools, libraries and researchers.

"I flatly disagree with that," said Lehman. The database provision "is more generous and liberal" than existing law, and will protect the fair use of databases by schools and librarians, he said.

On a third front, Lehman supports a measure in a pending Senate bill that would transfer legal authority over copyright regulations from Congress to the White House-controlled Patent and Trademark Office. The Senate bill, S 1961, is sponsored by Utah Republican Sen. Orrin Hatch, chairman of the Senate Committee on the Judiciary.

Hatch's bill is similar to a House bill that would deregulate the Patent Office, while keeping it a government-controlled agency. However, the Senate bill would also transfer the copyright office's policy authority to Lehman's office.

But the Senate's measure would transfer all copyright authority to the administration, perhaps hurting citizens' ability to make modest but fair use of companies' copyrighted information, said Marybeth Peters, the recorder of copyrights at the copyright office, based in the Library of Congress.

Lehman said the administration has not taken a position on the transfer of copyright authority, but he added that would ease the creation of a national copyright policy.

There is little time for the House and the Senate to iron out their differences and pass a unified bill, likely postponing congressional debate until 1997 on the copyright office.