Testimony before the Subcommittee on Telecommunications Trade, and Consumer Protection U.S. House of Representatives Committee on Commerce H.R. 2281 The WIPO Copyright Treaties Implementation Act June 6, 1998 Presented by: Charles E. Phelps, Ph.D. Provost University of Rochester On behalf of: Association of American Universities (AAU) Mr. Chairman and members of the Subcommittee: I am Charles E. Phelps, Provost and Professor of Economics and Political Science at the University of Rochester. I am pleased to have this opportunity to testify before the Commerce Subcommittee on Telecommunications, Trade and Consumer Affairs on behalf of the Association of American Universities, an organization of 62 major research universities. At my university and others around the United States, the Provost is the chief academic officer, ultimately the person in charge of all teaching and research work undertaken within the university. In standard corporate language, the Provost is the Chief Operating Officer for the main work of the university -- teaching and research. I speak today as an officer of one of the leading institutions in a sector of the US economy -- higher education -- that stands without question as the best in the world. The House Judiciary Committee has worked with the higher education community in developing this legislation, and a number of our initial concerns have been addressed. However, some important issues remain unresolved, matters about which I will speak today. The two most critical problems the current legislation poses for colleges and universities are: (1) the legislation creates a new right of access but includes none of the limitations or exceptions that are applied to proprietary rights in current law; the effect of this unconstrained new right would be to sharply restrict the ability of faculty and students to use information in research and education activities, (2) the on-line service provider liability provisions of Title II do not accommodate the special status of faculty employees or the need for due process in response to a notice of infringement. 1. Right of Access Current copyright law is carefully constructed as a balance between interests of producers and users of information. Accordingly, the law grants proprietary rights to copyright owners as an economic incentive for producing creative works, and the law establishes limitations and exceptions to those proprietary rights to enhance access to and productive use of creative works. One of the key exceptions to proprietary rights used by the academic community is "fair use." The Copyright Act of 1976 codified the judicially created "fair use" doctrine. The fair use defense was initially developed by the courts to limit the scope of copyright through a common sense "equitable rule of reason." The Copyright Act provides, in relevant part, that "the fair use of a copyrighted work, including such use by reproduction in copies . . ., for purposes such as criticism, comment, news reporting, teaching . . ., scholarship, or research" is not an infringement. The fair use doctrine permits the use of selected portions of copyrighted material under certain circumstances without having to secure the permission of the copyright owner. Fair use is fundamental to much of what we do in a university; the continuing vigor of our education and research programs depends on its continuing viability. However, H.R. 2281 creates a new right of access that, as currently crafted, contains no provision for fair use or any other limitations and exceptions to proprietary rights. Section 1201(a)(1) stipulates that "No person shall circumvent a technological protection measure that effectively controls access to a work protected under this title." This seemingly simple language could eliminate or sharply restrict university access to information by failing to stipulate also that fair use and other limitations and exceptions apply to this new right of access as they do to current proprietary rights. Such a result does not appear to be intended by the Judiciary Committee. Indeed, the committee added a "savings clause" (Sec. 1201(d)), which states that nothing in the bill shall affect current-law exemptions to copyright infringement. Moreover, the House Judiciary Committee Report (H. Rept. 105-551, Part I) contains the following language with respect to Sec. 1201(a)(1): Paragraph (a)(1). The act of circumventing a technological protection measure put in place by a copyright owner to control access to a copyrighted work is the electronic equivalent of breaking into a locked room in order to obtain a copy of a book. Paragraph (a)(1) establishes a general prohibition against gaining unauthorized access to a work by circumventing a technological protection measure put in place by the copyright owner where such protection measure otherwise effectively controls access to a work protected under Title 17 of the U.S. code. Paragraph (a)(1) does not apply to the subsequent actions of a person once he or she has obtained authorized access to a copy of a work protected under Title 17, even if such actions involve circumvention of additional forms of technological protection measures. In a fact situation where the access is authorized, the traditional defenses to copyright infringement, including fair use, would be fully applicable. So, an individual would not be able to circumvent in order to gain unauthorized access to a work, but would be able to do so in order to make fair use of a work that he or she has acquired lawfully. Despite these indications of intent to apply current-law limitations and exceptions to the new right of access, the proposed legislation does not fully accomplish this objective. The savings clause of 1201(d) simply continues current-law exemptions to copyright infringement, but is silent about the new prohibition against circumvention created by 1201(a)(1). And the Committee report language contains no comparable statutory language. We would appreciate this committee's assistance in adding statutory language to H.R. 2281 that implements the concepts contained in the report language quoted above. 2. On-line Service Provider Liability Limitations Our most important concerns with the liability provisions center on how our faculty would be treated under the proposed law. As employees of universities and colleges, faculty would -- under the current law -- create institutional liability for copyright violations that derive from the faculty members' independent actions. However, a strong (and valuable) culture and tradition in our universities and colleges maintains complete freedom of expression, work, and publication for faculty, unfettered and unsupervised by institutional oversight or control. The total intellectual freedom of our faculties is one of the most important aspects of the way we operate and has been a key factor in the emergence of the higher education system in the United States as the very best in the world. With that intellectual freedom firmly and universally supported by our colleges and universities, faculty can and do compete in the intellectual marketplace of ideas, and that competition creates our outstanding successes in both undergraduate and graduate education. Any effort to impose controls over the work of the faculty that interfered with their intellectual freedom would stifle the creativity and productivity of their work. However, if faculty are treated as employees of the university in this legislation's service provider liability scheme, the liability concerns arising from that law would place universities and colleges in a position of needing either to police the digital world of our universities vigorously to guard against copyright violation liability, or to scale back substantially the scope of university digital networks and services. Either outcome would create a substantial tension between the faculty and administration of any college or university, and would ultimately serve to dampen the effectiveness of our institutions. The solution most preferred from the point of view of universities and colleges would simply be to acknowledge that faculty are in every meaningful way unsupervised in terms of the material they put on the web, and therefore to treat them equivalently to students in our networked environments -- as users of networks rather than as service provider employees. This brings me to a second concern, namely how a college or university might respond to a notice of copyright infringement within the context of the current draft legislation's language. Under the proposed legislation, the copyright owner can serve "notice" of a possible violation of the copyright law, and the "defense" the university can undertake to avoid liability requires either that we convince the faculty member or student to remove the offending material, or, failing that, sever the individual's connection to the Web. (These acts are referred to as "takedown" of the allegedly offending material or connection.) This "notice and takedown" process assumes guilt, with possible innocence to be determined subsequently. Colleges and universities fully understand the need for an expeditious response to cases of copyright infringement in the digital environment, where a market can be damaged or destroyed quickly. But the legislation's notice and takedown procedure would have a different impact on institutions of higher education than it would on commercial service providers. For any .NET or .COM service provider, severing the connection of the implicated user merely eliminates $10 or $20 a month in revenue. In the .EDU world of universities and colleges, responding to a notice of alleged infringement is more problematic. Universities and colleges fundamentally rest on the premise that free and open expression of opinion is not only desirable, but essential. Enforcing the "takedown" of material in response to a notice of alleged infringement would have the appearance of suppression of speech, particularly in a setting where fair use makes the legality or illegality of a particular infringement claim less than crystal clear (more about this issue in a moment). Worse than taking down material before verifying that it is in fact infringing, severing a faculty or student's connection to the Web is tantamount to banishing that individual from the academic community. It would either alter the way faculty teach courses or (in the case of students) block the ability to participate. It would eliminate a major form of communication between our students and faculty that helps to create a sense of community. We could not envision taking such a drastic step without first invoking careful internal processes of review. Yet the proposed legislation offers these "takedown" actions as the only sure way to protect against liability. Whether any given claim of infringement would eventually be upheld by a court of law is much more uncertain in the world of higher education than in the commercial sector by virtue of the widespread and exceedingly important application of fair use. As indicated earlier, much of what we do in universities and colleges in teaching and research relies on our ability to access copyrighted material under fair use provisions. Fair use, as defined by legislation and case law, draws no bright line between acceptable use and unacceptable copyright violation. Reasonable people can differ in their views of what constitutes fair use. Yet in the proposed legislation, copyright owners can precipitate with the simple filing of a notice of infringement (which may or may not be valid) a series of difficult and potentially disruptive steps within the university that we would have to undertake to create a safe harbor. Thus, for universities, the safe harbor crafted in the legislation is scarcely a safe harbor at all, but more a perilous navigation between the Scilla of destroying our intellectual community (by taking down material or connections) and the Charybdis of facing liability for potential violations of the copyright law. In light of these concerns, we seek a recognition by those crafting the legislation that the notice and takedown process is more disruptive to the world of higher education than it is to the world of commercial online service providers. And we seek an understanding that any steps we take to either take down material or remove someone's connection to the Web through our networks must inevitably involve due process procedures within our institutions that have no counterpart in the world of commercial service providers. Indeed, if we did not undertake such careful procedures, we could well be held -- and rightly so, I firmly believe -- in violation of our implicit contracts with students about participation in our academic community or be put in a position of denying our faculty's ability to teach and conduct research effectively. We need -- and will be most happy and eager to work with the Congress -- to find modifications to the proposed legislation that accommodate the particular needs of the academic environment while at the same time protecting legitimate copyright interests. We take very seriously the legal protection of intellectual property, and indeed, universities and colleges and our faculty and staff benefit enormously from that system of protections. At the same time, our ability to teach and carry out research relies importantly on the access to information that the fair use provisions of copyright law create, and we urgently wish to maintain those rights in the world of digital information. Thank you for this opportunity to present our views.