`[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1858 Reported in House (RH)]





                                                 Union Calendar No. 213

106th CONGRESS

  1st Session

                               H. R. 1858

                      [Report No. 106-350, Part I]

_______________________________________________________________________

                                 A BILL

To promote electronic commerce through improved access for consumers to 
     electronic databases, including securities market information 
                               databases.

_______________________________________________________________________

                            October 8, 1999

 The Committee on the Judiciary discharged; committed to the Committee 
 of the Whole House on the State of the Union and ordered to be printed





                                                 Union Calendar No. 213
106th CONGRESS
  1st Session
                                H. R. 1858

                      [Report No. 106-350, Part I]

To promote electronic commerce through improved access for consumers to 
     electronic databases, including securities market information 
                               databases.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 19, 1999

   Mr. Bliley (for himself, Mr. Dingell, Mr. Tauzin, Mr. Markey, Mr. 
Oxley, and Mr. Towns) introduced the following bill; which was referred 
                      to the Committee on Commerce

                           September 30, 1999

    Reported with an amendment and referred to the Committee on the 
   Judiciary for a period ending not later than October 8, 1999, for 
  consideration of such provisions of the bill and amendment as fall 
within the jurisdiction of that committee pursuant to clause 1(k), rule 
                                   X
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

                            October 8, 1999

  Additional sponsors: Mr. Barton of Texas, Mr. Kasich, Mr. Clay, Ms. 
Eshoo, Mr. Deal of Georgia, Mr. Thompson of Mississippi, Mr. Blunt, Mr. 
     Stearns, Mr. Etheridge, Mr. McIntosh, Mr. Ney, Mr. Barrett of 
                       Wisconsin, and Mr. Boucher

                            October 8, 1999

 The Committee on the Judiciary discharged; committed to the Committee 
 of the Whole House on the State of the Union and ordered to be printed
[For text of introduced bill, see copy of bill as introduced on May 19, 
                                 1999]

_______________________________________________________________________

                                 A BILL


 
To promote electronic commerce through improved access for consumers to 
     electronic databases, including securities market information 
                               databases.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consumer and Investor Access to 
Information Act of 1999''.

          TITLE I--COMMERCE IN DUPLICATED DATABASES PROHIBITED

SEC. 101. DEFINITIONS.

    As used in this title:
            (1) Database.--(A) The term ``database'' means a collection 
        of a large number of discrete items of information that have 
        been collected and organized in a single place, or in such a 
        way as to be accessible through a single source, through the 
        investment of substantial monetary or other resources, for the 
        purpose of providing access to those discrete items of 
        information by users of the database. Such term does not 
        include works that are combined and ordered in a logical 
        progression or other meaningful way in order to tell a story, 
        communicate a message, represent an idea, or achieve a result.
            (B) If a database is organized into discrete sections 
        containing a large number of discrete items of information, 
        each section may be treated as a database if each such section 
        meets the requirements of subparagraph (A).
            (2) Duplicate of a database.--A database is ``a duplicate'' 
        of any other database if the database is substantially the same 
        as such other database, as a result of the extraction of 
        information from such other database.
            (3) Information.--The term ``information'' means facts, 
        data, or any other intangible material capable of being 
        collected and organized in a systematic way, with the exception 
        of works of authorship within the meaning of section 102 of 
        title 17, United States Code.
            (4) Commerce.--The term ``commerce'' means all commerce 
        which may be lawfully regulated by the Congress.
            (5) In competition.--The term ``in competition with'' when 
        used with respect to the sale or distribution of a database to 
        the public means that the database--
                    (A) displaces substantial sales or licenses of the 
                database of which it is a duplicate; and
                    (B) significantly threatens the opportunity to 
                recover a reasonable return on the investment in the 
                collecting or organizing of the duplicated database.
            (6) Government database.--The term ``government database'' 
        means a database that--
                    (A) has been collected or maintained by the United 
                States of America, any foreign government, or any 
                agency or instrumentality thereof;
                    (B) has been collected or maintained by a 
                commercial entity pursuant to a contract with the 
                United States of America or any agency or 
                instrumentality thereof, unless the information 
                contained in such database was permanently available on 
                an interactive computer network without restriction in 
                a publicly accessible electronic form without charge, 
                at the time a duplicate of such database was sold or 
                distributed; or
                    (C) is required by Federal statute or regulation to 
                be collected or maintained, to the extent so required.

SEC. 102. PROHIBITION AGAINST DISTRIBUTION OF DUPLICATES.

    It is unlawful for any person or entity, by any means or 
instrumentality of interstate or foreign commerce or communications, to 
sell or distribute to the public a database that--
            (1) is a duplicate of another database that was collected 
        and organized by another person or entity; and
            (2) is sold or distributed in commerce in competition with 
        that other database.

SEC. 103. PERMITTED ACTS.

    (a) Collecting or Use of Information Obtained Through Other 
Means.--Nothing in this title shall restrict any person or entity from 
selling or distributing to the public a database consisting of 
information obtained by means other than by extracting it from a 
database collected and organized by another person or entity.
    (b) News Reporting.--Nothing in this title shall restrict any 
person or entity from selling or distributing to the public a duplicate 
of a database for the sole purpose of news or sports reporting, 
including news and sports information gathering, dissemination, and 
comment, unless the information duplicated is time sensitive and has 
been collected by a news or sports reporting entity, and the sale or 
distribution is part of a consistent pattern engaged in for the purpose 
of direct competition.
    (c) Law Enforcement and Intelligence Activities.--Nothing in this 
title shall prohibit an officer, agent, or employee of the United 
States, a State, or a political subdivision of a State, or a person 
acting under contract with such officers, agents or employees, from 
selling or distributing to the public a duplicate of a database as part 
of lawfully authorized law enforcement or intelligence activities.
    (d) Scientific, Educational, or Research Uses.--No person or entity 
who, for scientific, educational, or research purposes, sells or 
distributes to the public a duplicate of a database that has been 
collected or organized by another person or entity shall incur 
liability under this title so long as such conduct is not part of a 
consistent pattern engaged in for the purpose of competition with that 
other person or entity.

SEC. 104. EXCLUSIONS.

    (a) Government Information.--
            (1) Exclusion of government databases.--Protection under 
        section 102 shall not extend to a government database.
            (2) Incorporated nongovernment portions protected.--The 
        incorporation of all or part of a government database into a 
        non-government database does not preclude protection for the 
        portions of the non-government database which came from a 
        source other than the government database.
            (3) Authority to exclude additional government-supported 
        databases.--Nothing in this title shall prevent the Federal 
        Government or a State or local government from establishing by 
        law or contract that a database, the creation or maintenance of 
        which is substantially funded by such Federal, State, or local 
        government, shall not be subject to the protection afforded 
        under this title.
    (b) Databases Related to Internet Communications.--Protection under 
section 102 does not extend to a database incorporating information 
collected or organized--
            (1) to perform the function of addressing, routing, 
        forwarding, transmitting, or storing Internet communications; 
        or
            (2) to perform the function of providing or receiving 
        connections for Internet communications.
    (c) Computer Programs.--
            (1) Protection not extended.--Subject to paragraph (2), 
        protection under section 102 shall not extend to computer 
        programs, including any computer program used in the 
        manufacture, production, operation, or maintenance of a 
        database, or any element of a computer program necessary to its 
        operation.
            (2) Incorporated databases.--A database that is otherwise 
        subject to protection under section 102 is not disqualified 
from such protection solely because it resides in a computer program, 
so long as the database functions as a database within the meaning of 
this title.
    (d) Nonprotectable Subject Matter.--Protection under section 102 
does not extend to the sale or distribution to the public of a 
duplicate of any individual idea, fact, procedure, system, method of 
operation, concept, principle, or discovery.
    (e) Subscriber List Information.--Protection under section 102 does 
not extend to a database of subscriber list information within the 
meaning of section 222(f) of the Communications Act of 1934 (47 U.S.C. 
222(f)). Nothing in this subsection shall affect the operation of 
section 222(e) of such Act, under which a telecommunications carrier 
provides, upon request, subscriber list information for the purposes of 
publishing directories in any format under nondiscriminatory and 
reasonable rates, terms, and conditions.
    (f) Legal Materials.--Protection under section 102 does not extend 
to a database of primary legal materials, including court opinions, 
statutes, codes, regulations, or administrative agency decisions, from 
any Federal, State, or local jurisdiction, unless such materials were 
permanently available on an interactive computer network without 
restriction, in an official publicly accessible electronic form without 
charge, at the time a duplicate of such database was sold or 
distributed.
    (g) Securities Market Data.--Nothing in this title shall apply to 
any database, or any discrete section of a database, composed 
predominantly of market information within the meaning of section 
11A(e)(6) of the Securities Exchange Act of 1934, as amended by section 
201 of this Act.

SEC. 105. RELATIONSHIP TO OTHER LAWS.

    (a) Other Rights Not Affected.--Subject to subsection (b), nothing 
in this title shall affect rights, limitations, or remedies concerning 
copyright, or any other rights or obligations relating to information, 
including laws with respect to patent, trademark, design rights, 
antitrust, trade secrets, privacy, access to public documents, misuse, 
and the law of contract.
    (b) Preemption of State Law.--On or after the effective date of 
this Act, no State law that prohibits or that otherwise regulates 
conduct that is subject to the prohibitions specified in section 102 
shall be effective to the extent that such State law is inconsistent 
with section 102.
    (c) Licensing.--Subject to the provisions on misuse in section 
106(b), nothing in this title shall restrict the rights of parties 
freely to enter into licenses or any other contracts with respect to 
the use of information.
    (d) Communications Act of 1934.--Nothing in this title shall affect 
the operation of the Communications Act of 1934 (47 U.S.C. 151 et seq.) 
or the authority of the Federal Communications Commission.
    (e) Securities Laws.--Nothing in this title shall affect--
            (1) the operation of the Securities Act of 1933 (15 U.S.C. 
        78a et seq.), the Securities Exchange Act of 1934 (15 U.S.C. 
        78a et seq.), the Public Utility Holding Company Act of 1935 
        (15 U.S.C. 79a et seq.), the Trust Indenture Act of 1939 (15 
        U.S.C. 77aaa et seq.), the Investment Company Act of 1940 (15 
        U.S.C. 80a-1 et seq.), the Investment Advisers Act of 1940 (15 
        U.S.C. 80b et seq.), or the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.); or
            (2) the authority of the Securities and Exchange 
        Commission.

SEC. 106. LIMITATIONS ON LIABILITY.

    (a) Service Provider Liability.--A provider of telecommunications 
services or information services (within the meaning of section 3 of 
the Communications Act of 1934 (47 U.S.C. 153)), or the operator of 
facilities therefor, shall not be liable for a violation of section 102 
if such provider or operator did not initially place the database that 
is the subject of the violation on a system or network controlled by 
such provider or operator.
    (b) Misuse.--A person or entity shall not be liable for a violation 
of section 102 if the person or entity benefiting from the protection 
afforded a database under section 102 misuses the protection. In 
determining whether a person or entity has misused the protection 
afforded under this title, the following factors, among others, shall 
be considered:
            (1) the extent to which the ability of persons or entities 
        to engage in the permitted acts under this title has been 
        frustrated by contractual arrangements or technological 
        measures;
            (2) the extent to which information contained in a database 
        that is the sole source of the information contained therein is 
        made available through licensing or sale on reasonable terms 
        and conditions;
            (3) the extent to which the license or sale of information 
        contained in a database protected under this title has been 
        conditioned on the acquisition or license of any other product 
        or service, or on the performance of any action, not directly 
        related to the license or sale;
            (4) the extent to which access to information necessary for 
        research, competition, or innovation purposes has been 
        prevented;
            (5) the extent to which the manner of asserting rights 
        granted under this title constitutes a barrier to entry into 
        the relevant database market; and
            (6) the extent to which the judicially developed doctrines 
        of misuse in other areas of the law may appropriately be 
        extended to the case or controversy.

SEC. 107. ENFORCEMENT.

    (a) Use of Federal Trade Commission Act Authority.--The Federal 
Trade Commission shall have jurisdiction, under section 5 of the 
Federal Trade Commission Act (15 U.S.C. 45), to prevent violations of 
section 102 of this title.
    (b) Rulemaking Authority.--The Federal Trade Commission may, 
pursuant to subparagraph (A) or (B) of section 18(a) of the Federal 
Trade Commission Act (15 U.S.C. 57a(a)), but without regard to the 
limitations contained in section 18(b)(3) of such Act, prescribe rules 
to implement this title.
    (c) Enforcement.--Any violation of any rule prescribed under 
subsection (b) shall be treated as a violation of a rule respecting 
unfair or deceptive acts or practices under section 5 of the Federal 
Trade Commission Act (15 U.S.C. 45). Notwithstanding section 5(a)(2) of 
such Act (15 U.S.C. 45(a)(2)), communications common carriers shall be 
subject to the jurisdiction of the Federal Trade Commission for 
purposes of this title.
    (d) Actions by the Commission.--The Federal Trade Commission shall 
prevent any person or entity from violating section 102 or a rule of 
the Commission under subsection (b) of this section in the same manner, 
by the same means, and with the same jurisdiction, powers, and duties 
as though all applicable terms and provisions of the Federal Trade 
Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a 
part of this title. Any person or entity who violates section 102 or 
such rule shall be subject to the penalties and entitled to the 
privileges and immunities provided in the Federal Trade Commission Act 
in the same manner, by the same means, and with the same jurisdiction, 
power, and duties as though all applicable terms and provisions of the 
Federal Trade Commission Act were incorporated into and made a part of 
this title.

SEC. 108. REPORT TO CONGRESS.

    Not later than 36 months after the date of enactment of this title, 
the Federal Trade Commission shall report to the Congress on the effect 
this title has had on electronic commerce and on the United States 
database industry and related parties, including--
            (1) the availability of databases, search engines, and 
        other tools for locating information necessary for electronic 
        commerce;
            (2) the extent of competition between database producers, 
        including the concentration of market power within the database 
        industry;
            (3) the investment in the development and maintenance of 
        databases, including changes in the number and size of 
        databases;
            (4) the availability of information to industries and 
        researchers which rely upon such availability;
            (5) whether in the period after enactment of this title 
        database producers have faced unfair competition, particularly 
        from publishers in the European Union; and
            (6) the extent to which extraction of information from 
        databases, to a degree insufficient to result in liability 
        under section 102, is harming database producers' incentive to 
        collect and organize databases.

SEC. 109. EFFECTIVE DATE.

    This title shall take effect on the date of the enactment of this 
Act, and shall apply to the sale or distribution after that date of a 
database that was collected and organized after that date.

                TITLE II--SECURITIES MARKET INFORMATION

SEC. 201. MISAPPROPRIATION OF REAL-TIME MARKET INFORMATION.

    Section 11A of the Securities Exchange Act of 1934 (15 U.S.C. 78k-
1) is amended by adding at the end the following new subsection:
    ``(e) Misappropriation of Real-Time Market Information.--
            ``(1) Prohibition against misappropriation.--Subject to 
        paragraphs (3), (4), and (5), any person or entity who--
                    ``(A) obtains directly or indirectly from a market 
                information processor real-time market information, and
                    ``(B) directly or indirectly sells, distributes or 
                redistributes, or otherwise disseminates such real-time 
                market information, without the authorization of such 
                market information processor,
        shall be liable to such market information processor for the 
        remedies set forth in paragraph (2).
            ``(2) Civil remedies.--
                    ``(A) Civil actions.--Any person who is injured by 
                a violation of paragraph (1) may bring a civil action 
                for such a violation in an appropriate United States 
                district court, except that any action against a State 
                governmental entity may be brought in any court that 
                has jurisdiction over claims against such entity.
                    ``(B) Temporary and permanent injunctions.--To the 
                extent otherwise authorized by section 1651 of title 
                28, United States Code, or other law, any court having 
                jurisdiction of a civil action under this subsection 
                shall have the power to grant temporary and permanent 
                injunctions, according to the principles of equity and 
                upon such terms as the court may deem reasonable, to 
                prevent a violation of paragraph (1).
                    ``(C) Monetary relief.--When a violation of 
                paragraph (1) has been established in any civil action 
                arising under this subsection, the plaintiff shall be 
                entitled to recover any damages sustained by the 
                plaintiff.
                    ``(D) Disgorgement.--When a violation of paragraph 
                (1) has been established, if the plaintiff is not able 
                to prove recoverable damages to the full extent of the 
                defendant's monetary gain directly attributable to the 
                violation, the court, in its equitable discretion, may 
                order the defendant to disgorge the amount of such 
                monetary gain to the plaintiff.
            ``(3) Permitted acts.--
                    ``(A) Gathering or use of real-time market 
                information independently obtained.--Nothing in this 
                subsection shall restrict any person or entity from 
                independently gathering real-time market information, 
                or from selling, distributing or redistributing, or 
                otherwise disseminating such independently gathered 
                information.
                    ``(B) News reporting.--Nothing in this subsection 
                shall restrict any news reporting entity from 
                extracting real-time market information for the sole 
                purpose of news reporting, including news gathering, 
                dissemination, and comment, unless the extraction is 
                part of a consistent pattern of competing in the 
                distribution of real-time market information with the 
                market information processor from which the information 
                was obtained.
            ``(4) Relationship to other laws.--
                    ``(A) Preemption.--Subject to subparagraphs (B) 
                through (F), on and after the date of enactment of this 
                subsection, this section--
                            ``(i) shall exclusively govern the 
                        unauthorized extraction, sale, distribution or 
                        redistribution, or other dissemination of real-
                        time market information; and
                            ``(ii) shall supersede any other Federal or 
                        State law (either statutory or common law) to 
                        the extent that--
                                    ``(I) such other Federal or State 
                                law establishes rights and remedies 
                                with respect to the unauthorized 
                                extraction, sale, distribution or 
                                redistribution, or other dissemination 
                                of real-time market information that 
                                are different from or in addition to 
                                the rights and remedies established by 
                                this subsection; or
                                    ``(II) such other Federal or State 
                                law is inconsistent with this section.
                    ``(B) Federal securities laws.--Nothing in this 
                subsection shall--
                            ``(i) affect the operation of any other 
                        provision of the securities laws (as defined in 
                        section 3(a)(47)), or the rules and regulations 
                        thereunder; or
                            ``(ii) impair or limit the authority of the 
                        Commission.
                    ``(C) Antitrust.--Nothing in this subsection shall 
                limit in any way the constraints that are imposed by 
                Federal and State antitrust laws on the manner in which 
                products and services may be provided to the public, 
                including those regarding single suppliers of products 
                and services.
                    ``(D) Licensing.--Nothing in this subsection shall 
                restrict the rights of parties freely to enter into 
                licenses or any other contracts with respect to the 
                extraction, sale, distribution or redistribution, or 
                other dissemination of real-time market information, 
                and to maintain civil actions under State law to 
                enforce such licenses or contracts.
                    ``(E) Federal trade commission.--Nothing in this 
                subsection shall affect--
                            ``(i) the authority of the Federal Trade 
                        Commission; or
                            ``(ii) the operation of any of the laws 
                        administered by the Federal Trade Commission.
                    ``(F) Other laws.--Nothing in this subsection shall 
                affect rights, limitations, or remedies concerning 
                rights or obligations under laws with respect to 
                patent, trademark, or fraud.
            ``(5) Limitations on actions.--
                    ``(A) Additional limitation.--No civil action shall 
                be maintained under this subsection for the extraction, 
                sale, distribution or redistribution, or other 
                dissemination of market information that is not real-
                time market information.
                    ``(B) Persons or entities subject to contractual 
                remedies.--No civil action shall be maintained under 
                this subsection by a market information processor 
                against any person or entity to whom such processor 
                provides real-time market information pursuant to a 
                contract or agreement between such processor and such 
                person or entity with respect to any real-time market 
                information or any rights or remedies provided pursuant 
                to such contract or agreement.
            ``(6) Definitions.--As used in this subsection:
                    ``(A) Market information.--The term `market 
                information' means information--
                            ``(i) with respect to quotations and 
                        transactions in any security; and
                            ``(ii) the collection, processing, 
                        distribution, and publication of which is 
                        subject to this title.
                    ``(B) Real-time market information.--Taking into 
                account the present state of technology, different 
                types of market data, how market participants use 
                market data, and other relevant factors, the Commission 
                may, consistent with the protection of investors and 
                the public interest and with the objectives of this 
                section, prescribe by rule the extent to which market 
                information shall be considered to be real-time market 
                information for purposes of this subsection.
                    ``(C) Market information processor.--The term 
                `market information processor' means any exchange, 
                self-regulatory organization, securities information 
                processor, or national market system plan 
                administrator.''.

SEC. 202. EFFECTIVE DATE.

    (a) In General.--The amendment made by section 201 shall take 
effect on the date of the enactment of this Act, and shall apply to 
acts committed on or after that date.
    (b) Prior Acts Not Affected.--No person or entity shall be liable 
under section 11A(e) of the Securities Exchange Act of 1934 (15 U.S.C. 
78k-1(e)), as added by section 201 of this Act, for the extraction, 
sale, distribution or redistribution, or other dissemination of real-
time market information prior to the date of enactment of this Act, by 
that person or by that person's predecessor in interest.`