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.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Piracy Deterrence and 
Education Act of 2004’’. 
SEC. 2. FINDINGS. 
The Congress finds as follows: 
(1) The Internet, while changing the way our 
society communicates, has also changed the nature
of many crimes, including the theft of intellectual 
property. 
(2) Trafficking in infringing copyrighted works 
through increasingly sophisticated electronic means, 
including peer-to-peer file trading networks, Internet 
chat rooms, and news groups, threatens lost jobs, 
lost income for creators, lower tax revenue, and 
higher prices for honest purchasers. 
(3) The most popular peer-to-peer file trading 
software programs have been downloaded by com-
puter users over 200,000,000 times. At any one time 
there are over 3,000,000 users simultaneously using 
just one of these services. Each month, on average, 
over 2,300,000,000 digital-media files are trans-
ferred among users of peer-to-peer systems. 
(4) Many computer users simply believe that 
they will not be caught or prosecuted for their con-
duct. 
(5) The security and privacy threats posed by 
certain peer-to-peer networks extend beyond users 
inadvertently enabling a hacker to access files. Mil-
lions of copies of one of the most popular peer-to-
peer networks contain software that could allow an 
independent company to take over portions of users’
computers and Internet connections and has the ca-
pacity to keep track of users’ online habits. 
(6) In light of these considerations, Federal law 
enforcement agencies should actively pursue crimi-
nals who steal the copyrighted works of others, and 
prevent such activity through enforcement and 
awareness. The public should be educated about the 
security and privacy risks associated with being con-
nected to certain peer-to-peer networks. 
SEC. 3. DETERRENCE AND COORDINATION. 
(a) PROGRAM; SHARING OF INFORMATION.—The Di-
rector of the Federal Bureau of Investigation, in consulta-
tion with the Register of Copyrights, shall—
(1) develop a program based on providing of in-
formation and notice to deter members of the public 
from committing acts of copyright infringement 
through the Internet; and 
(2) facilitate the sharing among law enforce-
ment agencies, Internet service providers, and copy-
right owners of information concerning acts of copy-
right infringement described in paragraph (1). 
The program under paragraph (1) shall include issuing 
appropriate warnings to individuals engaged in acts of 
copyright infringement described in paragraph (1) that 
they may be subject to criminal prosecution.
(b) CONSTRUCTION.—Nothing in this section shall be 
construed to expand the investigative or enforcement pow-
ers of the Federal Bureau of Investigation nor to affect 
the duty, if any, of Internet service providers to monitor 
their service, affirmatively seek facts indicating infringing 
activity, or share private information about the users of 
their systems. 
(c) PROHIBITION ON USE OF CERTAIN FUNDS.—The 
program created under subsection (a)(1) shall not use 
funds or resources of the Department of Justice allocated 
for criminal investigation or prosecution. 
SEC. 4. DESIGNATION AND TRAINING OF AGENTS IN COM-
PUTER HACKING AND INTELLECTUAL PROP-
ERTY UNITS. 
(a) DESIGNATION OF AGENTS IN CHIPS UNITS.—
The Attorney General shall ensure that any unit in the 
Department of Justice responsible for investigating com-
puter hacking or responsible for investigating intellectual 
property crimes is assigned at least one agent to support 
such unit for the purpose of investigating crimes relating 
to the theft of intellectual property. 
(b) TRAINING.—The Attorney General shall ensure 
that each agent assigned under subsection (a) has received 
training in the investigation and enforcement of intellec-
tual property crimes.
resources of the Department of Justice allocated for crimi-
nal investigation or prosecution. 
SEC. 6. ACTIONS BY THE GOVERNMENT OF THE UNITED 
STATES. 
Section 411(a) of title 17, United States Code, is 
amended in the first sentence by striking ‘‘Except for’’ 
and inserting ‘‘Except for an action brought by the Gov-
ernment of the United States or by any agency or instru-
mentality thereof, or’’. 
SEC. 7. AUTHORIZED APPROPRIATIONS. 
There are authorized to be appropriated to the De-
partment of Justice for fiscal year 2005 not less than 
$15,000,000 for the investigation and prosecution of viola-
tions of title 17, United States Code. 
SEC. 8. PREVENTION OF SURREPTITIOUS RECORDING IN 
MOTION PICTURE THEATERS. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘Artists’ Rights and Theft Prevention Act of 2004’’ or 
the ‘‘ART Act’’. 
(b) CRIMINAL PENALTIES FOR UNAUTHORIZED RE-
CORDING OF MOTION PICTURES IN A MOTION PICTURE 
THEATER.—
(1) IN
GENERAL.—Chapter 113 of title 18, 
United States Code, is amended by adding after sec-
tion 2319A the following new section:
‘‘§ 2319B. Unauthorized recording of motion pictures 
in a motion picture theater 
‘‘(a) OFFENSE.—Whoever, without the authorization 
of the copyright owner, knowingly uses or attempts to use 
an audiovisual recording device in a motion picture theater 
to transmit or make a copy of a motion picture or other 
audiovisual work protected under title 17, or any part 
thereof, in a motion picture theater shall—
‘‘(1) be imprisoned for not more than 3 years, 
fined under this title, or both; or 
‘‘(2) if the offense is a second or subsequent of-
fense, be imprisoned for no more than 6 years, fined 
under this title, or both. 
‘‘(b) FORFEITURE AND DESTRUCTION.—When a per-
son is convicted of a violation of subsection (a), the court 
in its judgment of conviction shall, in addition to any pen-
alty provided, order the forfeiture and destruction or other 
disposition of all unauthorized copies of motion pictures 
or other audiovisual works protected under title 17, or 
parts thereof, and any audiovisual recording devices or 
other equipment used in connection with the violation. 
‘‘(c) AUTHORIZED ACTIVITIES.—This section does 
not prevent any lawfully authorized investigative, protec-
tive, or intelligence activity by an officer, agent, or em-
ployee of the United States, a State, or a political subdivi-
sion of a State, or by a person acting pursuant to a con-
tract with the United States, a State, or a political sub-
division of a State. 
‘‘(d) VICTIM IMPACT STATEMENT.—
‘‘(1) IN GENERAL.—During the preparation of 
the presentence report pursuant to rule 32(c) of the 
Federal Rules of Criminal Procedure, victims of an 
offense under this section shall be permitted to sub-
mit to the probation officer a victim impact state-
ment that identifies the victim of the offense and the 
extent and scope of the injury and loss suffered by 
the victim, including the estimated economic impact 
of the offense on that victim. 
‘‘(2) CONTENTS.—A victim impact statement 
submitted under this subsection shall include—
‘‘(A) producers and sellers of legitimate 
works affected by conduct involved in the of-
fense; 
‘‘(B) holders of intellectual property rights 
in the works described in subparagraph (A); 
and 
‘‘(C) the legal representatives of such pro-
ducers, sellers, and holders. 
‘‘(e) DEFINITIONS.—In this section: 
‘‘(1) AUDIOVISUAL
WORK, COPY, ETC.—The 
terms ‘audiovisual work’, ‘copy’, ‘copyright owner’,
‘motion picture’, and ‘transmit’ have, respectively, 
the meanings given those terms in section 101 of 
title 17. 
‘‘(2) AUDIOVISUAL
RECORDING
DEVICE.—The 
term ‘audiovisual recording device’ means a digital 
or analog photographic or video camera, or any 
other technology or device capable of enabling the 
recording or transmission of a copyrighted motion 
picture or other audiovisual work, or any part there-
of, regardless of whether audiovisual recording is the 
sole or primary purpose of the device. 
‘‘(3) MOTION
PICTURE
THEATER.—The term 
‘motion picture theater’ means a movie theater, 
screening room, or other venue that is being used 
primarily for public performance of a motion pic-
ture.’’. 
(2) CONFORMING AMENDMENT.—The table of 
sections for chapter 113 of title 18, United States 
Code, is amended by inserting after the item relating 
to section 2319A the following:
‘‘2319B. Unauthorized recording of motion pictures in a motion picture the-
ater.’’.
SEC. 9. SENSE OF THE CONGRESS ON NEED TO TAKE STEPS 
TO PREVENT ILLEGAL ACTIVITY ON PEER-TO-
PEER SERVICES. 
(a) FINDINGS.—The Congress finds as follows:
(1) The most popular publicly accessible peer-
to-peer file sharing software programs combined 
have been downloaded worldwide over 600,000,000 
times. 
(2) The vast majority of software products, in-
cluding peer-to-peer technology, do not pose an in-
herent risk. Responsible persons making software 
products should be encouraged and commended for 
the due diligence and reasonable care they take in-
cluding by providing instructions, relevant informa-
tion in the documentation, disseminating patches, 
updates, and other appropriate modifications to the 
software. 
(3) Massive volumes of illegal activity, including 
the distribution of child pornography, viruses, and 
confidential personal information, and copyright in-
fringement occur on publicly accessible peer-to-peer 
file sharing services every day. Some publicly acces-
sible peer-to-peer file sharing services expose con-
sumers, particularly children, to serious risks, in-
cluding legal liability, loss of privacy, threats to com-
puter security, and exposure to illegal and inappro-
priate material. 
(4) The following studies and reports dem-
onstrate that pornography, including child pornog-
raphy, is prevalent on publicly available peer-to-peer 
file sharing services, and children are regularly ex-
posed to pornography when using publicly available 
peer-to-peer file-sharing services: 
(A) A February 2004 report by the Gen-
eral Accounting Office (GAO) states that chil-
dren using peer-to-peer file-sharing technology 
can be exposed inadvertently to pornographic 
content. When searching for popular terms like 
‘‘Britney’’, ‘‘Pokemon’’, and ‘‘Olsen twins’’, 
more than half the files retrieved were porno-
graphic, including 8 percent containing child 
pornography or child erotica. 
(B) The GAO also found that when 
searching the most popular peer-to-peer service 
for keywords known to be associated with child 
pornography, 42 percent of the returns (543 
out of 1,286 files) were associated with images 
of child pornography. 
(C) From 2001, when the National Center 
for Missing and Exploited Children began to 
track peer-to-peer child pornography, until 
2002, the number of reported incidents in-
creased over 400 percent—compared to an in-
crease of less than 100 percent for chat rooms,
less than 32 percent for websites, and no in-
crease for news groups and bulletin boards. 
(5) The full potential of peer-to-peer technology 
to benefit consumers has yet to be realized and will 
not be achieved until these problems are adequately 
addressed. 
(6) To date, the businesses that run publicly ac-
cessible file-sharing services have refused or failed to 
voluntarily and sufficiently address these problems. 
(7) Many users of publicly available peer-to-
peer file-sharing services are drawn to these systems 
by the lure of obtaining ‘‘free’’ music and movies. 
(8) While some users use parental controls to 
protect children from pornography available on the 
Internet and search engines, not all such controls 
work on publicly accessible peer-to-peer networks. 
(9) Businesses that run publicly accessible peer-
to-peer file sharing services have openly acknowl-
edged, and numerous studies and reports have estab-
lished, that these services facilitate and profit from 
massive amounts of copyright infringement, causing 
enormous damage to the economic well-being of the 
copyright industries whose works are being illegally 
‘‘shared’’ and downloaded.
(10) The legitimate digital music marketplace 
offers consumers a wide and growing array of 
choices for obtaining music legally, without exposure 
to the risks posed by publicly accessible peer-to-peer 
file sharing services. 
(11) The Federal Trade Commission issued a 
Consumer Alert in July of 2003 warning consumers 
that some file-sharing services contain damaging vi-
ruses and worms and, without the computer user’s 
knowledge or consent, install spyware to monitor a 
user’s browsing habits and send data to third parties 
or automatically open network connections. 
(12) Publicly available peer-to-peer file-sharing 
services can and should adopt reasonable business 
practices and use technology in the marketplace to 
address the existing risks posed to consumers by 
their services and facilitate the legitimate use of 
peer-to-peer file sharing technology and software. 
(b) SENSE OF CONGRESS.—It is the sense of the 
Congress that—
(1) responsible software developers should be 
commended, recognized, and encouraged for their ef-
forts to protect consumers; 
(2) currently the level of ongoing and persistent 
illegal and dangerous activity on publicly accessible
peer-to-peer file sharing services is harmful to con-
sumers, minors, and the economy; and 
(3) therefore, the Congress and the executive 
branch should consider all appropriate measures to 
protect consumers and children, and prevent such il-
legal activity. 
SEC. 10. ENHANCEMENT OF CRIMINAL COPYRIGHT IN-
FRINGEMENT. 
(a) CRIMINAL INFRINGEMENT.—Section 506 of title 
17, United States Code, is amended—
(1) by amending subsection (a) to read as fol-
lows: 
‘‘(a) CRIMINAL INFRINGEMENT.—Any person who—
‘‘(1) infringes a copyright willfully and for pur-
poses of commercial advantage or private financial 
gain, 
‘‘(2) infringes a copyright willfully by the repro-
duction or distribution, including by the offering for 
distribution to the public by electronic means, during 
any 180-day period, of 1 or more copies or 
phonorecords of 1 or more copyrighted works, which 
have a total retail value of more than $1,000, or 
‘‘(3) infringes a copyright by the knowing dis-
tribution, including by the offering for distribution 
to the public by electronic means, with reckless dis-
regard of the risk of further infringement, during 
any 180-day period, of—
‘‘(A) 1,000 or more copies or phonorecords 
of 1 or more copyrighted works, 
‘‘(B) 1 or more copies or phonorecords of 
1 or more copyrighted works with a total retail 
value of more than $10,000, or 
‘‘(C) 1 or more copies or phonorecords of 
1 or more copyrighted pre-release works, 
shall be punished as provided under section 2319 of title 
18. For purposes of this subsection, evidence of reproduc-
tion or distribution of a copyrighted work, by itself, shall 
not be sufficient to establish the necessary level of intent 
under this subsection.’’; and 
(2) by adding at the end the following: 
‘‘(g) DEFINITIONS.—In this section: 
‘‘(1) PRE-RELEASE WORK.—The term ‘pre-re-
lease work’ refers to a work protected under this 
title which has a commercial and economic value and 
which, at the time of the infringement, the defend-
ant knew or should have known that the work had 
not yet been made available by the copyright owner 
to individual members of the general public in copies 
or phonorecords for sale, license, or rental.
‘‘(2) RETAIL VALUE.—The ‘retail value’ of a 
copyrighted work is the retail price of that work in 
the market in which it is sold. In the case of an in-
fringement of a copyright by distribution, if the re-
tail price does not adequately reflect the economic 
value of the infringement, then the retail value may 
be determined using other factors, including but not 
limited to suggested retail price, wholesale price, re-
placement cost of the item, licensing, or distribution-
related fees.’’. 
(b) PENALTIES.—Section 2319 of title 18, United 
States Code, is amended—
(1) by redesignating subsections (d) and (e) as 
subsections (e) and (f), respectively; 
(2) by inserting after subsection (c) the fol-
lowing: 
‘‘(d) Any person who commits an offense under sec-
tion 506(a)(3) of title 17—
‘‘(1) shall be imprisoned not more than 3 years, 
or fined in the amount set forth in this title, or both, 
or, if the offense was committed for purposes of 
commercial advantage or private financial gain, im-
prisoned for not more than 5 years, or fined in the 
amount set forth in this title, or both; and
‘‘(2) shall, if the offense is a second or subse-
quent offense under paragraph (1), be imprisoned 
not more than 6 years, or fined in the amount set 
forth in this title, or both, or, if the offense was 
committed for purposes of commercial advantage or 
private financial gain, imprisoned for not more than 
10 years, or fined in the amount set forth in this 
title, or both.’’; and 
(3) in subsection (f), as so redesignated—
(A) in paragraph (1), by striking ‘‘and’’ 
after the semicolon; 
(B) in paragraph (2), by striking the pe-
riod and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(3) the term ‘financial gain’ has the meaning 
given that term in section 101 (relating to defini-
tions) of title 17.’’. 
(c) CIVIL REMEDIES FOR INFRINGEMENT OF A COM-
MERCIAL PRE-RELEASE COPYRIGHTED WORK.—Section 
504(b) of title 17, United States Code, is amended—
(1) by striking ‘‘The copyright owner’’ and in-
serting the following: 
‘‘(1) IN GENERAL.—The copyright owner’’; and 
(2) by adding at the end the following:
‘‘(2) DAMAGES
FOR
PRE-RELEASE
INFRINGE-
MENT.—
‘‘(A) IN
GENERAL.—In the case of any 
pre-release work, actual damages shall be pre-
sumed conclusively to be no less than $10,000 
per infringement, if a person—
‘‘(i) distributes such work by making 
it available on a computer network acces-
sible to members of the public; and 
‘‘(ii) knew or should have known that 
the work was intended for commercial dis-
tribution. 
‘‘(B) DEFINITION.—For purposes of this 
subsection, the term ‘pre-release work’ has the 
meaning given that term in section 506(g).’’. 
SEC. 11. AMENDMENT OF FEDERAL SENTENCING GUIDE-
LINES REGARDING THE INFRINGEMENT OF 
COPYRIGHTED 
WORKS 
AND 
RELATED 
CRIMES. 
(a) AMENDMENT
TO
THE
SENTENCING
GUIDE-
LINES.—Pursuant to its authority under section 994 of 
title 28, United States Code, and in accordance with this 
section, the United States Sentencing Commission shall 
review and, if appropriate, amend the sentencing guide-
lines and policy statements applicable to persons convicted
of intellectual property rights crimes, including sections 
2318, 2319, 2319A, 2319B, 2320 of title 18, United 
States Code, and sections 506, 1201, and 1202 of title 
17, United States Code. 
(b) FACTORS.—In carrying out this section, the Sen-
tencing Commission shall—
(1) take all appropriate measures to ensure that 
the sentencing guidelines and policy statements ap-
plicable to the offenses described in subsection (a) 
are sufficiently stringent to deter and adequately re-
flect the nature of such offenses; 
(2) consider whether to provide a sentencing en-
hancement for those convicted of the offenses de-
scribed in subsection (a) when the conduct involves 
the display, performance, publication, reproduction, 
or distribution of a copyrighted work before the time 
when the copyright owner has authorized the dis-
play, performance, publication, reproduction, or dis-
tribution of the original work, whether in the media 
format used by the infringing good or in any other 
media format; 
(3) 
consider 
whether 
the 
definition 
of 
‘‘uploading’’ contained in Application Note 3 to 
Guideline 2B5.3 is adequate to address the loss at-
tributable to people broadly distributing copyrighted 
works over the Internet without authorization; and 
(4) consider whether the sentencing guidelines 
and policy statements applicable to the offenses de-
scribed in subsection (a) adequately reflect any harm 
to victims from infringement in circumstances where 
law enforcement cannot determine how many times 
copyrighted material is reproduced or distributed. 
(c) PROMULGATION.—The Commission may promul-
gate the guidelines or amendments under this section in 
accordance with the procedures set forth in section 21(a) 
of the Sentencing Act of 1987, as though the authority 
under that Act had not expired.
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