USTR Witnesses Urge Stronger Enforcement Tools for IP Violations in Special 301 Review
The U.S. Trade Representative should establish tougher law enforcement tools to better protect international intellectual property rights (IPR), IP advocates said at a USTR hearing. Witnesses recommended procedural reforms to the Special 301 review.
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The Special 301 review process should be used “to secure trade interests of all U.S. constituencies and not merely a narrow set of stakeholders,” said Rashmi Rangnath, staff attorney at Public Knowledge. The agency should not force countries to provide IPR protections “beyond the requirements of their international obligations,” she said. A more diplomatic approach “will foster better economic ties with the U.S. trading process.” The process should not be used to coerce countries to agree to treaties, like the Anti-Counterfeiting Trade Agreement, she added.
International penalties seem grossly inadequate, said Jonathan Gelfand, general counsel for BeachBody, a workout DVD company. The enforcement tools are as effective as “being caught driving 90 miles an hour on the freeway and only receiving a $10 speeding ticket that didn’t go against your insurance,” he said: Some “Chinese auction” websites “are extremely problematic.” EBay has been responsive to takedown requests, but “the problem is that it’s so easy to come up with another username,” he said. Some of the foreign sites have up to a two-week takedown process, which allows them to transact “hundreds of thousands of dollars of business before they come down.” China is still the company’s largest problem country, he said. “We're spending a considerable amount of time chasing a lot of the websites that come up.” A lot of the sites are rings, where terms of use “will reference the old site” that was taken down, and 10 to 20 websites are working in concert, “masquerading as the company itself,” he said.
Procedural reforms are needed with respect to software enforcement, said the Social Science Research Council. It’s probably fair to say that industry losses have been largely driven by software piracy claims, said Joe Karaganis, an SSRC researcher. “Piracy is part of the software business model in developing countries.” Criminalization of end-user piracy is “very poor” and “is entirely addressable through civil means,” he said. “It really shouldn’t be the business of the USTR to help the software industry shift the cost of optimizing its business model to public lobbies in other countries.” That is a poor use of government resources, he added.
The International Intellectual Property Alliance identified 40 countries that deny adequate and effective protections of IPR and fair and equitable market access, said Michael Schlesinger, assistant general counsel. These countries “harm our creative content businesses that bring movies, music” and other entertainment to the world, he said. Vietnam and Spain have shown a rapid increase in Internet piracy, he said. Vietnam “is going down a very similar road to China in terms of relying mainly on administrative enforcement mechanisms and not having any effective criminal enforcement mechanisms in place."
Because of the enormous challenge posed by Internet and mobile piracy, there’s a need for “a multifaceted approach, a strong legal framework, appropriate levels of responsibility for online infringements,” and strict enforcement by governments, Schlesinger said.