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Hearing of the Courts, the Internet and Intellectual Property Subcommittee of the House Judiciary Committee - Intellectual Property Act of 2007


Location: Washington, DC


REP. HOWARD COBLE (R-NC): Thank you, Mr. Chairman. I want to initiate my comments by thanking you for the leadership that you have demonstrated in chairing what I regard as the judiciary's best subcommittee, generally, and I want to thank you specifically for having convened this hearing today. On the rare occasions, Mr. Chairman, that you and I have not seen eye to eye on a certain issue we have without exception disagreed agreeably.

Along with my colleagues who are cosponsors of this bipartisan bill, I share the view that this Congress must act to provide more effective tools and resources for those charged with combating piracy and counterfeiting. Indeed, I support the overwhelming majority of the provisions contained in this bill, and I hope to be able to add my name to that growing list at some point in the near future.

Prior to doing so, however, I believe it is in the interest of copyright holders and users to have further conversation and to develop a better understanding about the potential impact of Section 104, which relates to the computation of statutory damages in certain categories of copyright infringement actions.

This, Mr. Chairman, as you and I have discussed earlier, is a complex issue. I appreciate your understanding of my concern and your suggestions that the Copyright Office should as soon as practicable commence a roundtable sort of dialogue among the broad cross-section of interested stakeholders with the goal of providing further recommendations to our subcommittee. I support this process and want to take this opportunity to publicly encourage anyone with concerns about Section 104 to fully participate in this proposed dialogue.

Mr. Chairman, earlier this year, you will recall, Attorney General Gonzalez appeared before the full Judiciary Committee to discuss a range of issues involving the Department of Justice. During the question-and-answer period I asked the attorney general to specifically address concerns that the department may lack -- strike that -- to specifically address concerns that his department may lack the necessary tools to investigate and prosecute high-level intellectual property cases. I also asked him for guidance as to what steps we could take to more successfully prevent or prosecute counterfeiting and intellectual property piracy crimes within the United States and abroad.

I was impressed with the breadth and candor of General Gonzalez' unscripted response. He talked about the importance of increasing our level of cooperation with friends and allies around the world as well as the need to improve communications and education efforts targeted at American consumers. He stressed the determination and sophistication of criminals and terrorists, who will pay to advance technology by offering top dollar for the top innovators.

The attorney general described the department's engagement as an escalating real war that is being waged over the Internet through technology, and he candidly offered, and I quote, "I do sometimes worry that we don't have the best minds on this. We don't have adequate resources. And I think this is something that I would love to talk to the Congress about, because I worry about this very much," close quote. General Gonzalez also noted, "You always need more FBI agents, because these are very, very complicated cases."

Mr. Chairman, the bill before us today is one that has been drafted with a high degree of deliberation, thought and sensitivity to the concerns expressed by former Attorney General Gonzalez. I might add that they have been shared by many of us on this subcommittee for some time. The views of the department as well as other executive branch agencies and entities involved in enforcing and protecting IP rights have been weighed and given a great deal of consideration.

That said, the bill includes two bold new proposals. The first will establish an Office of the United States Intellectual Property Enforcement Representatives in the Executive Office of the President that is modeled, but on a much smaller scale, after the organic legislation that established the Office of the United States Trade Representative. The second will establish a new IP enforcement division at the Department of Justice that will ensure that IP enforcement issues, which are often forced to compete with other valid departmental priorities for scarce investigative and prosecutorial resources, will be able to receive a high level of dedicated attention, resources and priority that is commensurate to their importance to United States rights holders and to United States law enforcement interests.

Mr. Chairman, I'm sure much will be said as we continue to plow this field, but for the moment I look forward to hearing from our distinguished panel, and I again thank you, Mr. Chairman, for having convened this hearing, and yield back.


REP. COBLE: Thank you, Mr. Chairman, and thank the witnesses for appearing this morning.

Ms. Mandelker, it is my belief that IP-related criminal offenses traditionally have not enjoyed a high prosecutorial priority. I do believe, however, that has improved in recent times. With that in mind, what percentage of the department's resources are dedicated exclusively to the investigation and prosecution of IP-related criminal offenses?

MS. MANDELKER: Mr. Coble, I can't give you a specific percentage, but what I can tell you is what resources we do have dedicated to this important problem.

We have 230 computer hacking and intellectual property prosecutors spread throughout the country in the various U.S. attorneys' offices. Each U.S. attorney's office has at least one prosecutor who is specially trained to work on these types of cases.

In addition, within the U.S. attorney's offices, we have 25 units, CHIP units, so prosecutors of two or more who are, again, specially focused on IP theft. And within the Criminal Division where I work, we have 40 prosecutors in the Computer Crime and Intellectual Property Section, 14 of which are exclusively dedicated to IP theft.

Of course, this is an issue that is of priority within the department and so we have a task force of individuals across the department who are focused on this problem, including myself, including somebody in the attorney general's office and also in the deputy attorney general's office.

REP. COBLE: Thank you.

Ms. Sohn, let me get your opinion. Do you know whether a website may be considered to be a compilation under the Copyright Act, A, and if so do you know whether website owners actually register their sites with the Copyright Office and whether they would be conceivably -- would they conceivably be entitled to statutory damages in the event of infringement?

MS. SOHN: Certainly I don't see why a website couldn't be considered a compilation. And I don't really know if website owners -- I assume some website owners would register their websites with the Copyright Office, sure.

REP. COBLE: Well, some critics of Section 104 have alleged that it might have the effect of intervening in ongoing copyright litigation. What do you say to that?

MS. SOHN: Could you repeat the question? I'm not quite sure I understand.

REP. COBLE: I said some critics of Section 104 have alleged that it -- that this section, if enacted, might have the effect of intervening in ongoing copyright litigation that has been initiated. What is your response to that?

MS. SOHN: Well, that's entirely possible. I mean, it depends on whether you want to make it retroactive or not. Obviously Google is being sued in the Google book search case. They're being sued. Their subsidiary YouTube is being sued by Viacom. So it's possible it might have an effect.

REP. COBLE: I was going to ask Mr. Cotton a question, but I'm having a senior moment.

I was going to ask you a question, Mr. Cotton, but I cannot grasp it for the moment.

So with that in mind, Mr. Chairman, I will yield back before the red light appears.

REP. BERMAN: Thank you, Mr. Chairman. I mean -- Mr. Chairman -- Mr. Coble.

REP. COBLE: Thank you, sir.

REP. BERMAN: You were chairman for a long time -- (laughter) -- in the great days when you were chairman. I remember them well.

REP. COBLE: Thank you, sir.

Mr. Watt, the gentleman from North Carolina.


REP. COBLE: Mr. Chairman, I apologize for my ineptness. I misfiled my question. I just wanted to hear from Mr. Cotton. I don't think it's been addressed.

Mr. Cotton, the decision to require dedicated resources at DOJ, the White House and elsewhere is somewhat unusual and, some in the executive branch I think would argue, wrongheaded.

They imply that it will create an inflexible and meddlesome bureaucracy, and I'm not convinced that would be the case.

What do you say in response to that?

MR. COTTON: Well, I think our experience teaches one lesson very clearly, and it is one that has been reported to me from every sector of the coalition that I'm involved with, which is that officials that have a general jurisdiction responsibility wind up having other pressures on them to the extent that IP enforcement tends to fall down the to-do list, and that until there are both senior policy executives and until there are significant, dedicated, specialized IP enforcement resources, we will not make progress in addressing the issues that are on the table.

REP. COBLE: I thank you. That's what I wanted to get in.

Mr. Chairman, I thank you for recognizing me.


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