SOPA/PIPA, Foe to Internet Content Providers: Gone for Good, or Making a Comeback?

Supporters of bolder anti-piracy legislation, led by Hollywood, are dissatisfied with the current safeguards enacted to combat internet file-sharing.  The current legislation in place, the 1998 DCMA, requires sites to remove pirated materials upon any request made within the safe harbor period.  Beyond the safe harbor period, a service provider is no longer liable.  SOPA/PIPA (respectively, the House of Representatives’ Stop Online Piracy Act and the Senate’s Protect IP Act) are the recent failed attempts at extending the reach of the government when it comes to alleged copyright infringements on the internet.  Instead of a simple obligation to take down infringing content after a request, called a “takedown notice,” is received, there would be an obligation for each site to proactively keep an eye out for an infringing content; once the infringing content is posted, the site owner, for example, YouTube, would risk being shut down entirely.

Therein lies one of the chief criticisms of SOPA/PIPA: by having the government remove non-infringing content along with the infringing material, the constitutional guarantee of a right to free speech is violated.

SOPA/PIPA is not only aimed at entertainment; those with IP rights who have seen their goods counterfeited are also served by the legislation.  That is why Tiffany’s and True Religion Jeans, among others, voiced their support in letters to Congress.  On the other side of the issue, there was an interesting alignment of constitutionalists, the ACLU, and, most saliently, Silicon Valley.

What does all this mean for businesses?  As a Pepper Hamilton attorney explains, it makes paying for internet advertising a lot more risky: “If you’re marketing on a site and paying for spots, and it gets shut down, those marketing dollars are gone.  You could pay for something that is there for a day after paying for a month or a year.”

Following the January 18 coordinated blackout, where several sites attempted to simulate the potential broad censorship that would occur under SOPA/PIPA enforcement, various websites galvanized internet users to pressure Congress to jettison the legislation.  Despite previously broad support throughout Congress for the legislation, Congress announced the next day that it planned to table the bills indefinitely and the blackout was, thus, a great success.

At this point, the future of government involvement in online piracy is uncertain.  The MPAA even threatened to withhold financial support from the Democratic Party in the upcoming election, despite Hollywood’s role as a traditional bastion of democratic fundraising.

February 11, 2012: anti-ACTA protests across Europe. Image shown is of Warsaw, Poland.

Presently, there are protests throughout Europe over an international agreement that echoes the SOPA/PIPA approach: ACTA.  ACTA stands for “Anti-Counterfeiting Trade Agreement.”  The agreement was established in Tokyo, and signed by the EU.  However, EU member states have yet to ratify the agreement.  Germany has already stated it will not ratify ACTA, while it has proven immensely unpopular throughout Eastern Europe in particular.

Touting an alternative approach, one Congressman criticized SOPA/PIPA while emphasizing the need for a different framework than the one offered by SOPA/PIPA to address internet piracy.  California Republican Darrell Issa on the one hand criticized SOPA/PIPA and on the other hand suggested that the U.S. International Trade Commission would be the proper arbiter of these disputes.  The OPEN act is emerging as a possible replacement for the failed SOPA/PIPA legislation.  OPEN embodies the ideas of Rep. Issa, as described above.  Issa explains how the bill would work in effect: “If the ITC investigation finds that a foreign registered website is ‘primarily’ and ‘willfully’ infringing on the IP rights of a U.S. rights holder, the commission would issue a cease and desist order that would compel payment processors (like Visa and Paypal) and online advertising providers to cease doing business with the foreign site in question.  This would cut off financial incentives for this illegal activity and deter these unfair imports from reaching the U.S. market.”  While the bill is supported by Google and other Silicon Valley companies, the MPAA criticizes OPEN as going too easy on piracy.

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*  Lena Mualla is a second-year law student at Wake Forest University School of Law.  She holds a Bachelor of Arts in Government and International Politics from George Mason University.  Ms. Mualla, a Fulbright award recipient, taught English in Indonesia prior to entering law school.  Upon graduation, she intends to practice international law or environmental law.