The Digital Millennium Copyright Act

WIPO Treaties Implementing Legislation [New]

Title I of the DMCA implements the WIPO treaties. To give effect to the treaties’ national eligibility requirements, the implementing legislation amends Sections 101 and 104 to extend protection under U.S. law to the works protected under the treaties. Like the Berne implementing legislation, the DMCA restores protection to works of other member countries that had not fallen into the public domain in the country of origin (except for expiration of term) but were no longer protected in the United States for failure to comply with formalities. Foreign works but not U.S. works are exempted from the Section 411(a) registration formalities.

The DMCA also added a new sui generis chapter 12 to title 17, implementing the treaty requirement that member countries provide adequate and effective protection against circumvention of technological measures used by copyright owners to protect their works under Section 1201, and implementing the treaty requirement that integrity of copyright management information be maintained (Section 1202).

Section 1201 prohibits the act of circumventing unauthorized access to a work and proscribes circumvention of copy protection schemes. Circumventing copying protection schemes, unlike circumventing access, is not tightly prohibited because fair use (at least theoretically) applies to works online, and thus in some instances the public will be justified in circumventing copy protection schemes in order to make fair use copies of a work. Under Sections 1201(d)–(j), government activities are expressly excluded from the circumvention provisions, as are nonprofit libraries, archives, and educational institutions if they circumvent to determine whether they want to access the work and entities that circumvent for the purposes of reverse engineering, encryption research, obtaining and disseminating personal identification information, and security testing. Section 1201(k) requires, in a clear case of special interest legislation, that within 18 months of enactment, all analog videocassette records be designed to conform with Macrovision to prevent copying of videos and analog signals.

Section 1202(a) prohibits knowingly providing or distributing false Copyright Management Information as defined under Section 1201(c), with the intent to induce, enable, facilitate, or conceal infringement. Related Section 1202(b) prohibits the unauthorized intentional removal or alteration of Copyright Management Information, or the dissemination of a work with altered or removed Copyright Management Information. Governmental activities are exempted under Section 1202(d), and broadcast stations and cable systems enjoy limited liability under Section 1202(e).

Sections 1203 and 1204 set out the civil and criminal penalties, respectively, for the violation of Sections 1201 or 1202, including equitable remedies and monetary damages, and criminal penalties of up to a $1,000,000 fine or 10 years’ imprisonment.

Finally, Section 1201(g) requires the Copyright Office to conduct two {Page 14} studies, one on encryption and the other on the effect of Sections 1201 and 1202 on technical developments.

Online Copyright Infringement Liability Limitation [New]

Title II of the DMCA creates a new Section 512 of the Copyright Act limiting the liability of service providers for transitory communications, system caching, storage of information on systems or networks at a user’s direction, and information location tools. The definition of “service provider” under the transitory communications exemption of Section 512(k)(1)(A) is more narrow than the same definition under the other three exemptions, found in Section 512(k)(1)(B). To qualify for any of the exemptions, however, under Section 512(i) a service provider must (1) adopt and reasonably implement a policy of terminating accounts of repeat infringers and (2) accommodate and not interfere with “standard technical measures.”

The transitory communications exemption, Section 512(a), limits the service provider’s liability when it transfers digital information at another’s request and covers not only transmission, routing, and providing connections but the making of transient copies as well. The system caching exemption limits a service provider’s liability for retaining for a limited time unmodified copies of material made available by someone other than the service provider which a subscriber directs to be transmitted. There are further conditions a service provider must meet: the content cannot be modified, retained copies must be refreshed in accordance with the statute, “hit” information cannot be interfered with, access must be limited in accordance with whatever conditions are imposed by the individual who posted the material, and material posted without authorization must be removed or blocked as soon as the service provider has notice that it has been done at the origination site.

The DMCA also limits service providers’ liability for infringing material posted on websites under Sections 512(c) and (g). The eligibility requirements are that (1) the provider cannot have actual knowledge of the infringement or be on notice, from either facts or circumstances, of the infringement, and must respond expeditiously to block or remove the material as soon as it has such knowledge or notice; (2) the provider cannot gain a financial benefit from the infringement if it has control over the infringing activity; and (3) the provider must expeditiously remove or block access to the infringing work as soon as it receives proper notice of the claimed infringement through its designated agent, which must have been filed with the Copyright Office. As a safeguard, Section 512(f) provides that if someone knowingly materially misrepresents that a work is infringing or was mistakenly removed or blocked, that party is liable for the resulting damages, costs, and attorneys’ fees to the alleged infringer, copyright owner, or service provider.

Section 512(d) uses the same standards as set forth in Section 512(c) to offer service providers limited liability for referring (i.e., hyperlinking) users to a website containing infringing material.

Section 512(e) offers limited liability to nonprofit educational institutions when their teachers or students infringe material online with knowledge or {Page 15} awareness, so long as the infringement does not include providing access to course materials that were required or recommended in the past three years, the institution was not notified more than twice over three years that the teacher or student was infringing (you would think one notification would be enough), and the school provides users with materials promoting copyright compliance.

Computer Maintenance and Repair: Reversing MAI v. Peak [New]

The DMCA reverses the result of Mai v. Peak42 but not the theory (i.e., that a temporary copy of a program is a reproduction and thus requires authorization by the copyright owner) by amending Section 117 of title 17 to permit a computer program owner to make a temporary copy of a program for the purpose of maintaining or repairing a computer.

Broadcasters’ Ephemeral Digital Sound Recordings Exemption [New]

Section 402 of the DMCA expands Section 112 of title 17 to give FCC-licensed broadcasters and Digital Performance Right in Sound Recordings Act statutory license holders (including subscription music services, webcasters, and satellite digital audio radio services) the right to create ephemeral recordings in order to digitally transmit a sound recording. The Act also requires sound recording owners to make available to broadcasters the means to circumvent any technology that prevents the reproduction of the work, or to exempt the broadcasters from liability if they make a copy after the owner does not timely provide the circumvention technology.

Library and Archives Exemption [New]

Section 404 of the DMCA amends Section 108 of title 17 to exempt libraries and archives from putting copyright notices on reproductions the library or archive makes unless the particular copy of the work reproduced bears a copyright notice. Libraries and archives also are permitted to make up to three copies, instead of just one, of either digital or analog phonorecords for preservation or research purposes. The digital copies, however, may not be distributed in a digital format or made available to the public for use outside the library or archive.

The Webcasting Statutory License [New]

The Digital Performance Right in Sound Recordings Act (DPRSRA) did not expressly mention webcasters. In the DMCA, Congress expanded the formerly {Page 16} unwieldy and now impenetrable Section 114 to give webcasters the right to the DPRSRA statutory license and to further limit the already weak digital performance right. The conference committee report urges the courts not to strip licensees of their license if they commit an “erroneous” “non-material violation” under the new Section 114, a violation that is bound to happen under such an unwieldy piece of legislation.

This section of the DMCA also amends Section 112 to create an ephemeral recording option for digital transmitters who want to make more than one exempted copy. Now, any transmitter who qualifies for a statutory license under Section 114(f) (not just broadcasters) can obtain an ephemeral copy license and make more than one copy.

Assumption of Contractual Obligations Upon Transfers of Rights in Motion Pictures [New]

Inserted into Section 4001 of the DMCA is a provision addressing assumption of residual payment obligations for motion pictures, in light of the frequent transfers and bankruptcies in the industry that does lunches and deals but not contracts.

Protecting Boat Hull Designs [New]

The Vessel Boat Hull Design Protection Act adds a new chapter 13 to title 17. The Act provides sui generis protection for 10 years to boat hulls that are no longer than 200 feet. The Act requires that the vessel hull be “an original design of a useful article.” The Act hyperextends the copyright concepts, requiring originality and using copyright useful-article language, yet granting protection without any mention of conceptual separability.

To qualify for the protection, an application of the design needs to be registered within two years of making the design public. The Act then grants the owner of the design the exclusive right to make, sell, import, or distribute for sale or commercial use a hull embodying the design, subject to a few exemptions. As passed, the Act was scheduled to expire two years from enactment, on October 28, 2000.

Revisions to the Act were made in the 1999 budget bill,43 including removing the sunset and providing the following revised definition of a “vessel”:

A “vessel” is a craft—

(A) that is designed and capable of independently steering a course on or through water through its own means of propulsion; and

(B) that is designed and capable of carrying and transporting one or more passengers.

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Effective Dates [New]

The DMCA generally was effective upon enactment. One exception is title I, implementation of the treaties, which although also generally effective upon enactment, has a few exceptions, such as the national eligibility and restoration provisions, which are effective when the treaties go into force with respect to the United States.

106th Congress: 1999–2000 [New]

After enacting the bloated DMCA, Congress quickly turned its attention to other matters, such as figuring out ways to permit the massive theft of broadcast signals satellite distributors have engaged in since the late 1980s. Congress was apparently shocked—shocked!—that arbitrators had faithfully followed the 1994 amendments to Section 119 in setting market rates for lawful satellite retransmissions. But it was truly shocked when the networks, after years of being grilled about why they hadn’t sued satellite distributors for flagrantly violating the white area restrictions, not only sued but won, leading to a scheduled termination of service for ineligible consumers. The double whammy caused by this unaccustomed respect for congressional intent caused Congress to howl quickly in protest and to set about undoing things. Various bills with titles like “Save Our Satellites,”44 “Satellite Television Improvement Act,”45 and the like46 were introduced, but one bill, H.R. 1554, by Congressman Coble, took off like a satellite signal itself, being passed on the floor of the House on the suspension calendar the day after its introduction, April 26th. The Senate, a more deliberative body, waited a whole three weeks before sending its version, previously introduced as S. 247, back under the same bill number. A conference was requested and agreed to and conferees were appointed, and there things sat in the summer break. After the summer recess, Congress came back invigorated, compromises were struck, and a major revision to Section 119 was folded into the budget bill.47 The sunset was extended once again, this time to December 31, 2004, the royalty rates were substantially reduced (superstation signals by 30 percent and network signals by 45 percent), and for the first time, local signals may be provided to subscribers. Recreational vehicles and commercial long-haul trucks were included, while the definition of “unserved household”—important for determining eligibility to receive distant network signals—was revised. Satellite companies will be required to comply with must carry rules, just like cable.

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The budget bill contained other intellectual property provisions, including a surprise “technical” amendment revising the work-for-hire categories in Section 101 to include sound recordings. In separate legislation48 statutory damages were increased, to a minimum of $750 and a maximum of $30,000 for nonwillful infringement and $150,000 for willful infringement. Additionally, the Sentencing Commission was told to get off their duff and issue guidelines for penalties assessed under the 1997 No Electronic Theft Act.

Another “technical corrections” act, Public Law No. 106-44,49 corrected things like two Sections 512 (Section 512, passed as part of the Sony Bono Copyright Term Extension Act, is now Section 513), and (as a matter of substance) increased the “on sale” bar to boat hull protection from one to two years.50

Another perennial, sui generis data base protection, threatens again, this time seriously,51 joined by special interest legislation in the form of an amendment to title VII of the Communications Act of 1934 concerning rights in stock trading information.52

42 991 F.2d 511, 26 USPQ2d 1458 (9th Cir. 1993).

43 P.L. 106–113, 106th Cong., 1st Sess. (Nov. 25, 1999).

44 H.R. 851, 106th Cong., 1st Sess. (1999).

45 H.R. 1027, 106th Cong., 1st Sess. (1999).

46 See also H.R. 89 (“Satellite Access to Local Televisions Act”); S. 247 (“Satellite Home Viewers Improvements Act”); S. 303 (“Satellite Television Act”); H.R. 768 (“Copyright Compulsory License Improvement Act”); H.R. 1554 (“Satellite Copyright, Competition, and Consumer Protection Act of 1999”), 106th Cong., 1st Sess. (1999).

47 P.L. 106-113, 106th Cong., 1st Sess. (Nov. 29, 1999).

48 P.L. 106-160.

49 Act of Aug. 5, 1999 (S. 1260), 106th Cong., 1st Sess., 113 Stat. 221.

50 Amending 17 U.S.C. §1302(5).

51 H.R. 354, 106th Cong., 1st Sess. (1999).

52 S. 95, 106th Cong., 1st Sess. (1999) (McCain).