The U.S. District Court's Jan. 20 ruling favoring the Recording Industry Assn. of America (RIAA) in its 6-month-old lawsuit against Verizon could trigger an expensive political fight in Congress for changes in the 1998 Digital Millenium Copyright Act (DMCA). The court ruled that under the DMCA, such Internet service providers (ISPs) as Verizon must turn over subscriber information of potential copyright infringers to the RIAA and other copyright holders without requiring them to file a lawsuit.

The landmark decision by U.S. District Court Judge John D. Bates holds that in response to an "information subpoena" that the RIAA served last summer, Verizon was obliged to identify a subscriber who has illegally made available more than 600 copyrighted music files via the Internet.

Verizon had argued that the subpoena to turn over the records under the DMCA is valid only when an ISP is hosting material, not when it is only providing Internet access as a passive conduit of data. Bates ruled that Verizon's position "would create a huge loophole in Congress' efforts to prevent copyright infringement on the Internet."

Verizon attorney Sarah B. Deutsch says the company will appeal the case to the U.S. Court of Appeals for the District of Columbia Circuit before a three-judge panel after 30 days.

RIAA president Cary Sherman says the ruling "validates our interpretation of the law. We look forward to contacting the account-holder whose identity we were seeking so we can let them know that what they are doing is illegal."

Deutsch says, "We'd be quite upset if the RIAA were to begin an aggressive campaign against users without at least allowing the Court of Appeals to resolve this issue."

A ROCK AND A HARD PLACE

Sherman tells Billboard that the RIAA does not have any plans yet to subpoena Verizon or other companies to cough up other customer identities. "There's no defined path," he says. "This will be just one more tool in the arsenal in addressing the piracy issue."

Sherman also discounts the notion that the ruling could flare up into a political mess. "There are people out there who want to reopen the DMCA, right? So any possible excuse that they have, they're going to use. All this really proves is that Congress established an expedited procedure to deal with blatant copyright infringement. It's been in effect since 1998, and it has not been a problem-there hasn't been any abuse of it in all this time."

He also says that the industry will move forward, despite efforts to paint its activities as anti-consumer. "Sales in this industry are being killed, so which unhappy place would we rather be in: having an unhappy father who finds out his son is doing something illegal, or continuing to see sales go down the toilet [and] be unable to find any new talent or promote or market anyone on the roster and retail stores closing left and right? Which would we prefer?"

Sherman maintains that the DMCA provisions dealing with subpoenas do not make any distinction between those who host alleged infringing material on their site or server and those who serve merely as a conduit. "The provision never drew a distinction whether the ISP hosted the content or simply was a conduit for the content-and that's the only issue here." He adds, "I say this with great confidence, because we negotiated it."

One of the main parties to the negotiations between content companies and ISPs, Rep. Rick Boucher, D-Va., disagrees. "The DMCA clearly did not contemplate subpoenas in circumstances where the party who's sued does not maintain the material in question on its own computers or servers. The proper procedure, under the DMCA, would be a 'John Doe' lawsuit against the alleged infringer, and in the context of that lawsuit, subpoenas could be issued to the parties who would have the relevant information." Boucher also predicts, "I think the decision will be reversed."

The possible fight, observers say, hinges on two factors: whether the RIAA and record companies use the ruling selectively and judiciously to go after large-scale file-sharing infringers, and whether the opinion is upheld on appeal.

For its part, the RIAA says that the judge's ruling clearly states that there are safeguards for consumers and ISPs in the DMCA's sections permitting subpoenas to gain information to snag alleged abusers, including that of perjury for a company that requests the information not "in good faith." The RIAA also points out that the person it wants information on is "an uploader, making 600 files available, not a downloader."

Deutsch says Verizon does not look forward to a legislative battle. "We'd like the courts to resolve this. As you know, legislation is a long and difficult and painful process. But if the consumers get a raw deal, I'm sure there'll be calls to make things right in the eyes of consumers."

Members of Congress, like the rest of the nation, now use the Internet daily at work and at home and are much more attuned to online issues now than they were when the DMCA was debated and crafted, especially to matters relating to online privacy. And, as an observer noted, "many have telephone company and tech-corridor constituents back home."

Media Access Project president Andy Schwartzman says such companies will try to convince Congress that the ruling allows authorized "fishing expeditions," adding, "There's adequate remedies to go after illegal abusers without having to sweep in perfectly legitimate fair-use users in the process."

THE DMCA'S HISTORY

The DMCA was conceived in 1995 as a general-principles white paper from the Department of Commerce to allow the U.S. to join the World Intellectual Property Organization with digital-age copyright protections.

In the following years, hearings in the Senate and House aired the views of all involved parties and struggled to hammer out final provisions. One of the most contentious negotiations involved the issue of third-party infringement liability and the means to uncover infringers.

"We spent years negotiating the DMCA," Deutsch says. "And for years, everyone knew what it meant. And until the RIAA brought this challenge, no one was using this subpoena process to seek the identities of people whose material didn't reside on the service provider's system or network. There wasn't [peer-to-peer (P2P) file sharing] at the time we negotiated the DMCA, but there were things like file transfer protocol and attachments to e-mail, which are essentially the same thing. And people clearly understood the distinction between a 'conduit' and a 'hoster.' "

Jay Rosenthal, co-counsel of the Recording Artists' Coalition, says the artists' group is pleased with the ruling. He echoes others in the industry who are beginning to consider pushing for a government levy on ISPs similar to the blank-tape levy instituted in the '80s to offset losses due to home copying and piracy.

"For the first time, a court has ruled that ISPs cannot simply stand by while rampant P2P activity is taking place," he says. "Hopefully, this will spur Congressional re-examination of the ISPs' waiver of liability and perhaps move us toward implementation of an ISP levy or compulsory license."

Several bills that address fair use and piracy will be considered in the new Congress. Boucher reintroduced his Digital Media Consumers' Rights Act Jan. 7; he says the bill will protect the fair-use rights of users of copyrighted material and thereby allow digital-media consumers to make copies for their personal convenience. Copying for commercial gain would still be prohibited.

The bill, H.R. 107, also addresses two key provisions of the DMCA that prohibit the circumvention of a technical protection measure guarding access to copyrighted material even if the purpose of the circumvention is to exercise consumer fair-use rights. The new bill would limit the scope of the prohibition to circumvention for the purpose of copyright infringement. Its co-sponsors are Reps. John Doolittle, R-Calif.; Spencer Bachus, R-Ala.; and Patrick Kennedy, D-R.I. The RIAA opposes the bill, which never made it out of subcommittee in the last Congress.

Rep. Howard Berman, D-Calif., also plans to reintroduce a modified version of his bill that would allow content companies to employ such self-help technical measures as spamming-but short of hacking-to slow down or confuse peer-to-peer file sharing.