New Digital Theft Law Ups Monetary Penalties

WASHINGTON, D.C.-President Clinton signed into law in December a bill that raises the ante for music pirates and other copyright-infringement violators by increasing statutory monetary penalties as much as 50%. New jail terms may also be considered when Congress starts its next session later this month.
The bill, the Digital Theft Deterrence and Copyright Damages Improvement Act, H.R. 3456, was introduced near the end of last session by Rep. Howard Coble, R-N.C., chairman of the House Intellectual Property Subcommittee. Clinton signed the bill Dec. 9.
The noncontroversial measure was approved on the House floor Nov. 18, the same day it was introduced. It was approved by the Senate the next day.
Short, sweet, and to the point, the one-page bill amends Chapter 5, Section 501, of the Copyright Act and replaces the minimum and maximum fines available to judges. The current $500 minimum per infringement penalty was made $750; the current maximum $20,000 per infringement fine was upped to $30,000; and the current maximum fine for "willful infringement" of $100,000 per infringement was increased to $150,000.
Jail terms are not increased under the measure, but Coble's office says members may consider new sentencing guidelines when Congress returns in late January.
Music industry reaction to the new law was positive. "There's no question it will be a better deterrent," says Ed Murphy, president of the National Music Publishers' Assn. "In fact, it's already had an effect-one Internet "interloper' has already taken down a site and cited the increased penalties as the reason."
Cary Sherman, senior executive VP/general counsel of the Recording Industry Assn. of America, says, "This demonstrates Congress's commitment to creators and copyright owners and its increasing recognition of the value of copyrighted works to our economy and to society. The increase in the levels of statutory damages can only further help in the fight against piracy."
ASCAP's Washington lobbyists also agree that that the new law will make a difference. A spokesman for BMI was not available for comment at press time.
Coble says that although the bill went through "at the midnight hour," with the Senate's approval, the penalty hike issue was "thoroughly examined in a hearing earlier this year."
He cites the increased penalties as a warning to pirates that the cost of business has gone up. Using a back-home, North Carolina idiom, he comments on the effect of the penalty hikes on infringers: "It was time we 'splained it to 'em."
Coble adds that "the last time we took a look at these penalties was in 1988. So it was time to at least raise them in light of the cost of inflation."
In the rush of last-minute votes, a spokesman in Coble's office admits there was no announcement of the bill's passage. "It kinda got lost in the shuffle," he says.