I 

108TH CONGRESS 

2D SESSION H. R. 4077

To enhance criminal enforcement of the copyright laws, to educate the public 

about the application of copyright law to the Internet, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 31, 2004

Mr. SMITH of Texas (for himself, Mr. BERMAN, and Mr. CONYERS) introduced 

the following bill; which was referred to the Committee on the Judiciary 

A BILL

To enhance criminal enforcement of the copyright laws, to 

educate the public about the application of copyright 

law to the Internet, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Piracy Deterrence and 

5 Education Act of 2004’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds as follows: 

8 (1) The Internet, while changing the way our 

9 society communicates, has also changed the nature 
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1 of many crimes, including the theft of intellectual 

2 property. 

3 (2) Trafficking in infringing copyrighted works 

4 through increasingly sophisticated electronic means, 

5 including peer-to-peer file trading networks, Internet 

6 chat rooms, and news groups, threatens lost jobs, 

7 lost income for creators, lower tax revenue, and 

8 higher prices for honest purchasers. 

9 (3) The most popular peer-to-peer file trading 

10 software programs have been downloaded by com11 puter users over 200,000,000 times. At any one time 

12 there are over 3,000,000 users simultaneously using 

13 just one of these services. Each month, on average, 

14 over 2,300,000,000 digital-media files are trans15 ferred among users of peer-to-peer systems. 

16 (4) Many computer users simply believe that 

17 they will not be caught or prosecuted for their con18 duct. 

19 (5) The security and privacy threats posed by 

20 certain peer-to-peer networks extend beyond users 

21 inadvertently enabling a hacker to access files. Mil22 lions of copies of one of the most popular peer-to23 peer networks contain software that could allow an 

24 independent company to take over portions of users’ 
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1 computers and Internet connections and has the ca2 pacity to keep track of users’ online habits. 

3 (6) In light of these considerations, Federal law 

4 enforcement agencies should actively pursue crimi5 nals who steal the copyrighted works of others, and 

6 prevent such activity through enforcement and 

7 awareness. The public should be educated about the 

8 security and privacy risks associated with being con9 nected to certain peer-to-peer networks. 

10 SEC. 3. DETERRENCE AND COORDINATION. 

11 (a) PROGRAM; SHARING OF INFORMATION.—The Di12 rector of the Federal Bureau of Investigation, in consulta13 tion with the Register of Copyrights, shall—

14 (1) develop a program based on providing of in15 formation and notice to deter members of the public 

16 from committing acts of copyright infringement 

17 through the Internet; and 

18 (2) facilitate the sharing among law enforce19 ment agencies, Internet service providers, and copy20 right owners of information concerning acts of copy21 right infringement described in paragraph (1). 

22 The program under paragraph (1) shall include issuing 

23 appropriate warnings to individuals engaged in acts of 

24 copyright infringement described in paragraph (1) that 

25 they may be subject to criminal prosecution. 
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1 (b) CONSTRUCTION.—Nothing in this section shall be 

2 construed to expand the investigative or enforcement pow3 ers of the Federal Bureau of Investigation nor to affect 

4 the duty, if any, of Internet service providers to monitor 

5 their service, affirmatively seek facts indicating infringing 

6 activity, or share private information about the users of 

7 their systems. 

8 (c) PROHIBITION ON USE OF CERTAIN FUNDS.—The 

9 program created under subsection (a)(1) shall not use 

10 funds or resources of the Department of Justice allocated 

11 for criminal investigation or prosecution. 

12 SEC. 4. DESIGNATION AND TRAINING OF AGENTS IN COM13 PUTER HACKING AND INTELLECTUAL PROP14 ERTY UNITS. 

15 (a) DESIGNATION OF AGENTS IN CHIPS UNITS.—

16 The Attorney General shall ensure that any unit in the 

17 Department of Justice responsible for investigating com18 puter hacking or responsible for investigating intellectual 

19 property crimes is assigned at least one agent to support 

20 such unit for the purpose of investigating crimes relating 

21 to the theft of intellectual property. 

22 (b) TRAINING.—The Attorney General shall ensure 

23 that each agent assigned under subsection (a) has received 

24 training in the investigation and enforcement of intellec25 tual property crimes. 
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1 SEC. 5. EDUCATION PROGRAM. 

2 (a) ESTABLISHMENT.—There shall be established 

3 within the Office of the Associate Attorney General of the 

4 United States an Internet Use Education Program. 

5 (b) PURPOSE.—The purpose of the Internet Use 

6 Education Program shall be to—

7 (1) educate the general public concerning the 

8 value of copyrighted works and the effects of the 

9 theft of such works on those who create them; and 

10 (2) educate the general public concerning the 

11 privacy, security, and other risks of using the Inter12 net to obtain illegal copies of copyrighted works. 

13 (c) SECTOR SPECIFIC MATERIALS.—The Internet 

14 Use Educational Program shall, to the extent appropriate, 

15 develop materials appropriate to Internet users in dif16 ferent sectors of the general public where criminal copy17 right infringement is a concern. The Attorney General 

18 shall consult with appropriate interested parties in devel19 oping such sector-specific materials. 

20 (d) CONSULTATIONS.—The Attorney General shall 

21 consult with the Register of Copyrights and the Secretary 

22 of Commerce in developing the Internet Use Education 

23 Program under this section. 

24 (e) PROHIBITION ON USE OF CERTAIN FUNDS.—The 

25 program created under this section shall not use funds or 
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1 resources of the Department of Justice allocated for crimi2 nal investigation or prosecution. 

3 SEC. 6. ACTIONS BY THE GOVERNMENT OF THE UNITED 

4 STATES. 

5 Section 411(a) of title 17, United States Code, is 

6 amended in the first sentence by striking ‘‘Except for’’ 

7 and inserting ‘‘Except for an action brought by the Gov8 ernment of the United States or by any agency or instru9 mentality thereof, or’’. 

10 SEC. 7. AUTHORIZED APPROPRIATIONS. 

11 There are authorized to be appropriated to the De12 partment of Justice for fiscal year 2005 not less than 

13 $15,000,000 for the investigation and prosecution of viola14 tions of title 17, United States Code. 

15 SEC. 8. PREVENTION OF SURREPTITIOUS RECORDING IN 

16 MOTION PICTURE THEATERS. 

17 (a) SHORT TITLE.—This section may be cited as the 

18 ‘‘Artists’ Rights and Theft Prevention Act of 2004’’ or 

19 the ‘‘ART Act’’. 

20 (b) CRIMINAL PENALTIES FOR UNAUTHORIZED RE21 CORDING OF MOTION PICTURES IN A MOTION PICTURE

22 THEATER.—

23 (1) IN GENERAL.—Chapter 113 of title 18, 

24 United States Code, is amended by adding after sec25 tion 2319A the following new section: 
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1 ‘‘§ 2319B. Unauthorized recording of motion pictures 

2 in a motion picture theater 

3 ‘‘(a) OFFENSE.—Whoever, without the authorization 

4 of the copyright owner, knowingly uses or attempts to use 

5 an audiovisual recording device in a motion picture theater 

6 to transmit or make a copy of a motion picture or other 

7 audiovisual work protected under title 17, or any part 

8 thereof, in a motion picture theater shall—

9 ‘‘(1) be imprisoned for not more than 3 years, 

10 fined under this title, or both; or 

11 ‘‘(2) if the offense is a second or subsequent of12 fense, be imprisoned for no more than 6 years, fined 

13 under this title, or both. 

14 ‘‘(b) FORFEITURE AND DESTRUCTION.—When a per15 son is convicted of a violation of subsection (a), the court 

16 in its judgment of conviction shall, in addition to any pen17 alty provided, order the forfeiture and destruction or other 

18 disposition of all unauthorized copies of motion pictures 

19 or other audiovisual works protected under title 17, or 

20 parts thereof, and any audiovisual recording devices or 

21 other equipment used in connection with the violation. 

22 ‘‘(c) AUTHORIZED ACTIVITIES.—This section does 

23 not prevent any lawfully authorized investigative, protec24 tive, or intelligence activity by an officer, agent, or em25 ployee of the United States, a State, or a political subdivi26 sion of a State, or by a person acting pursuant to a con-
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1 tract with the United States, a State, or a political sub2 division of a State. 

3 ‘‘(d) VICTIM IMPACT STATEMENT.—

4 ‘‘(1) IN GENERAL.—During the preparation of 

5 the presentence report pursuant to rule 32(c) of the 

6 Federal Rules of Criminal Procedure, victims of an 

7 offense under this section shall be permitted to sub8 mit to the probation officer a victim impact state9 ment that identifies the victim of the offense and the 

10 extent and scope of the injury and loss suffered by 

11 the victim, including the estimated economic impact 

12 of the offense on that victim. 

13 ‘‘(2) CONTENTS.—A victim impact statement 

14 submitted under this subsection shall include—

15 ‘‘(A) producers and sellers of legitimate 

16 works affected by conduct involved in the of17 fense; 

18 ‘‘(B) holders of intellectual property rights 

19 in the works described in subparagraph (A); 

20 and 

21 ‘‘(C) the legal representatives of such pro22 ducers, sellers, and holders. 

23 ‘‘(e) DEFINITIONS.—In this section: 

24 ‘‘(1) AUDIOVISUAL WORK, COPY, ETC.—The 

25 terms ‘audiovisual work’, ‘copy’, ‘copyright owner’, 
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1 ‘motion picture’, and ‘transmit’ have, respectively, 

2 the meanings given those terms in section 101 of 

3 title 17. 

4 ‘‘(2) AUDIOVISUAL RECORDING DEVICE.—The 

5 term ‘audiovisual recording device’ means a digital 

6 or analog photographic or video camera, or any 

7 other technology or device capable of enabling the 

8 recording or transmission of a copyrighted motion 

9 picture or other audiovisual work, or any part there10 of, regardless of whether audiovisual recording is the 

11 sole or primary purpose of the device. 

12 ‘‘(3) MOTION PICTURE THEATER.—The term 

13 ‘motion picture theater’ means a movie theater, 

14 screening room, or other venue that is being used 

15 primarily for public performance of a motion pic16 ture.’’. 

17 (2) CONFORMING AMENDMENT.—The table of 

18 sections for chapter 113 of title 18, United States 

19 Code, is amended by inserting after the item relating 

20 to section 2319A the following:

‘‘2319B. Unauthorized recording of motion pictures in a motion picture theater.’’.

21 SEC. 9. SENSE OF THE CONGRESS ON NEED TO TAKE STEPS 

22 TO PREVENT ILLEGAL ACTIVITY ON PEER-TO23 PEER SERVICES. 

24 (a) FINDINGS.—The Congress finds as follows: 
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1 (1) The most popular publicly accessible peer2 to-peer file sharing software programs combined 

3 have been downloaded worldwide over 600,000,000 

4 times. 

5 (2) The vast majority of software products, in6 cluding peer-to-peer technology, do not pose an in7 herent risk. Responsible persons making software 

8 products should be encouraged and commended for 

9 the due diligence and reasonable care they take in10 cluding by providing instructions, relevant informa11 tion in the documentation, disseminating patches, 

12 updates, and other appropriate modifications to the 

13 software. 

14 (3) Massive volumes of illegal activity, including 

15 the distribution of child pornography, viruses, and 

16 confidential personal information, and copyright in17 fringement occur on publicly accessible peer-to-peer 

18 file sharing services every day. Some publicly acces19 sible peer-to-peer file sharing services expose con20 sumers, particularly children, to serious risks, in21 cluding legal liability, loss of privacy, threats to com22 puter security, and exposure to illegal and inappro23 priate material. 

24 (4) The following studies and reports dem25 onstrate that pornography, including child pornog-
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1 raphy, is prevalent on publicly available peer-to-peer 

2 file sharing services, and children are regularly ex3 posed to pornography when using publicly available 

4 peer-to-peer file-sharing services: 

5 (A) A February 2004 report by the Gen6 eral Accounting Office (GAO) states that chil7 dren using peer-to-peer file-sharing technology 

8 can be exposed inadvertently to pornographic 

9 content. When searching for popular terms like 

10 ‘‘Britney’’, ‘‘Pokemon’’, and ‘‘Olsen twins’’, 

11 more than half the files retrieved were porno12 graphic, including 8 percent containing child 

13 pornography or child erotica. 

14 (B) The GAO also found that when 

15 searching the most popular peer-to-peer service 

16 for keywords known to be associated with child 

17 pornography, 42 percent of the returns (543 

18 out of 1,286 files) were associated with images 

19 of child pornography. 

20 (C) From 2001, when the National Center 

21 for Missing and Exploited Children began to 

22 track peer-to-peer child pornography, until 

23 2002, the number of reported incidents in24 creased over 400 percent—compared to an in25 crease of less than 100 percent for chat rooms, 
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1 less than 32 percent for websites, and no in2 crease for news groups and bulletin boards. 

3 (5) The full potential of peer-to-peer technology 

4 to benefit consumers has yet to be realized and will 

5 not be achieved until these problems are adequately 

6 addressed. 

7 (6) To date, the businesses that run publicly ac8 cessible file-sharing services have refused or failed to 

9 voluntarily and sufficiently address these problems. 

10 (7) Many users of publicly available peer-to11 peer file-sharing services are drawn to these systems 

12 by the lure of obtaining ‘‘free’’ music and movies. 

13 (8) While some users use parental controls to 

14 protect children from pornography available on the 

15 Internet and search engines, not all such controls 

16 work on publicly accessible peer-to-peer networks. 

17 (9) Businesses that run publicly accessible peer18 to-peer file sharing services have openly acknowl19 edged, and numerous studies and reports have estab20 lished, that these services facilitate and profit from 

21 massive amounts of copyright infringement, causing 

22 enormous damage to the economic well-being of the 

23 copyright industries whose works are being illegally 

24 ‘‘shared’’ and downloaded. 
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1 (10) The legitimate digital music marketplace 

2 offers consumers a wide and growing array of 

3 choices for obtaining music legally, without exposure 

4 to the risks posed by publicly accessible peer-to-peer 

5 file sharing services. 

6 (11) The Federal Trade Commission issued a 

7 Consumer Alert in July of 2003 warning consumers 

8 that some file-sharing services contain damaging vi9 ruses and worms and, without the computer user’s 

10 knowledge or consent, install spyware to monitor a 

11 user’s browsing habits and send data to third parties 

12 or automatically open network connections. 

13 (12) Publicly available peer-to-peer file-sharing 

14 services can and should adopt reasonable business 

15 practices and use technology in the marketplace to 

16 address the existing risks posed to consumers by 

17 their services and facilitate the legitimate use of 

18 peer-to-peer file sharing technology and software. 

19 (b) SENSE OF CONGRESS.—It is the sense of the 

20 Congress that—

21 (1) responsible software developers should be 

22 commended, recognized, and encouraged for their ef23 forts to protect consumers; 

24 (2) currently the level of ongoing and persistent 

25 illegal and dangerous activity on publicly accessible 
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1 peer-to-peer file sharing services is harmful to con2 sumers, minors, and the economy; and 

3 (3) therefore, the Congress and the executive 

4 branch should consider all appropriate measures to 

5 protect consumers and children, and prevent such il6 legal activity. 

7 SEC. 10. ENHANCEMENT OF CRIMINAL COPYRIGHT IN8 FRINGEMENT. 

9 (a) CRIMINAL INFRINGEMENT.—Section 506 of title 

10 17, United States Code, is amended—

11 (1) by amending subsection (a) to read as fol12 lows: 

13 ‘‘(a) CRIMINAL INFRINGEMENT.—Any person who—

14 ‘‘(1) infringes a copyright willfully and for pur15 poses of commercial advantage or private financial 

16 gain, 

17 ‘‘(2) infringes a copyright willfully by the repro18 duction or distribution, including by the offering for 

19 distribution to the public by electronic means, during 

20 any 180-day period, of 1 or more copies or 

21 phonorecords of 1 or more copyrighted works, which 

22 have a total retail value of more than $1,000, or 

23 ‘‘(3) infringes a copyright by the knowing dis24 tribution, including by the offering for distribution 

25 to the public by electronic means, with reckless dis-
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1 regard of the risk of further infringement, during 

2 any 180-day period, of—

3 ‘‘(A) 1,000 or more copies or phonorecords 

4 of 1 or more copyrighted works, 

5 ‘‘(B) 1 or more copies or phonorecords of 

6 1 or more copyrighted works with a total retail 

7 value of more than $10,000, or 

8 ‘‘(C) 1 or more copies or phonorecords of 

9 1 or more copyrighted pre-release works, 

10 shall be punished as provided under section 2319 of title 

11 18. For purposes of this subsection, evidence of reproduc12 tion or distribution of a copyrighted work, by itself, shall 

13 not be sufficient to establish the necessary level of intent 

14 under this subsection.’’; and 

15 (2) by adding at the end the following: 

16 ‘‘(g) DEFINITIONS.—In this section: 

17 ‘‘(1) PRE-RELEASE WORK.—The term ‘pre-re18 lease work’ refers to a work protected under this 

19 title which has a commercial and economic value and 

20 which, at the time of the infringement, the defend21 ant knew or should have known that the work had 

22 not yet been made available by the copyright owner 

23 to individual members of the general public in copies 

24 or phonorecords for sale, license, or rental. 
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1 ‘‘(2) RETAIL VALUE.—The ‘retail value’ of a 

2 copyrighted work is the retail price of that work in 

3 the market in which it is sold. In the case of an in4 fringement of a copyright by distribution, if the re5 tail price does not adequately reflect the economic 

6 value of the infringement, then the retail value may 

7 be determined using other factors, including but not 

8 limited to suggested retail price, wholesale price, re9 placement cost of the item, licensing, or distribution10 related fees.’’. 

11 (b) PENALTIES.—Section 2319 of title 18, United 

12 States Code, is amended—

13 (1) by redesignating subsections (d) and (e) as 

14 subsections (e) and (f), respectively; 

15 (2) by inserting after subsection (c) the fol16 lowing: 

17 ‘‘(d) Any person who commits an offense under sec18 tion 506(a)(3) of title 17—

19 ‘‘(1) shall be imprisoned not more than 3 years, 

20 or fined in the amount set forth in this title, or both, 

21 or, if the offense was committed for purposes of 

22 commercial advantage or private financial gain, im23 prisoned for not more than 5 years, or fined in the 

24 amount set forth in this title, or both; and 
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1 ‘‘(2) shall, if the offense is a second or subse2 quent offense under paragraph (1), be imprisoned 

3 not more than 6 years, or fined in the amount set 

4 forth in this title, or both, or, if the offense was 

5 committed for purposes of commercial advantage or 

6 private financial gain, imprisoned for not more than 

7 10 years, or fined in the amount set forth in this 

8 title, or both.’’; and 

9 (3) in subsection (f), as so redesignated—

10 (A) in paragraph (1), by striking ‘‘and’’ 

11 after the semicolon; 

12 (B) in paragraph (2), by striking the pe13 riod and inserting ‘‘; and’’; and 

14 (C) by adding at the end the following: 

15 ‘‘(3) the term ‘financial gain’ has the meaning 

16 given that term in section 101 (relating to defini17 tions) of title 17.’’. 

18 (c) CIVIL REMEDIES FOR INFRINGEMENT OF A COM19 MERCIAL PRE-RELEASE COPYRIGHTED WORK.—Section 

20 504(b) of title 17, United States Code, is amended—

21 (1) by striking ‘‘The copyright owner’’ and in22 serting the following: 

23 ‘‘(1) IN GENERAL.—The copyright owner’’; and 

24 (2) by adding at the end the following: 
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1 ‘‘(2) DAMAGES FOR PRE-RELEASE INFRINGE2 MENT.—

3 ‘‘(A) IN GENERAL.—In the case of any 

4 pre-release work, actual damages shall be pre5 sumed conclusively to be no less than $10,000 

6 per infringement, if a person—

7 ‘‘(i) distributes such work by making 

8 it available on a computer network acces9 sible to members of the public; and 

10 ‘‘(ii) knew or should have known that 

11 the work was intended for commercial dis12 tribution. 

13 ‘‘(B) DEFINITION.—For purposes of this 

14 subsection, the term ‘pre-release work’ has the 

15 meaning given that term in section 506(g).’’. 

16 SEC. 11. AMENDMENT OF FEDERAL SENTENCING GUIDE17 LINES REGARDING THE INFRINGEMENT OF 

18 COPYRIGHTED WORKS AND RELATED 

19 CRIMES. 

20 (a) AMENDMENT TO THE SENTENCING GUIDE21 LINES.—Pursuant to its authority under section 994 of 

22 title 28, United States Code, and in accordance with this 

23 section, the United States Sentencing Commission shall 

24 review and, if appropriate, amend the sentencing guide25 lines and policy statements applicable to persons convicted 
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1 of intellectual property rights crimes, including sections 

2 2318, 2319, 2319A, 2319B, 2320 of title 18, United 

3 States Code, and sections 506, 1201, and 1202 of title 

4 17, United States Code. 

5 (b) FACTORS.—In carrying out this section, the Sen6 tencing Commission shall—

7 (1) take all appropriate measures to ensure that 

8 the sentencing guidelines and policy statements ap9 plicable to the offenses described in subsection (a) 

10 are sufficiently stringent to deter and adequately re11 flect the nature of such offenses; 

12 (2) consider whether to provide a sentencing en13 hancement for those convicted of the offenses de14 scribed in subsection (a) when the conduct involves 

15 the display, performance, publication, reproduction, 

16 or distribution of a copyrighted work before the time 

17 when the copyright owner has authorized the dis18 play, performance, publication, reproduction, or dis19 tribution of the original work, whether in the media 

20 format used by the infringing good or in any other 

21 media format; 

22 (3) consider whether the definition of 

23 ‘‘uploading’’ contained in Application Note 3 to 

24 Guideline 2B5.3 is adequate to address the loss at-
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1 tributable to people broadly distributing copyrighted 

2 works over the Internet without authorization; and 

3 (4) consider whether the sentencing guidelines 

4 and policy statements applicable to the offenses de5 scribed in subsection (a) adequately reflect any harm 

6 to victims from infringement in circumstances where 

7 law enforcement cannot determine how many times 

8 copyrighted material is reproduced or distributed. 

9 (c) PROMULGATION.—The Commission may promul10 gate the guidelines or amendments under this section in 

11 accordance with the procedures set forth in section 21(a) 

12 of the Sentencing Act of 1987, as though the authority 

13 under that Act had not expired.

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