Attorney General Asks for More Tools to Combat IP Infringement

Eric Holder at hearing in 2013

Yesterday the House Judiciary Committee held an oversight hearing where Committee Members grilled Attorney General Eric Holder on recent controversies. However, lost in the coverage of the heated moments and verbal slip-ups (including Rep. Gohmert’s gem that “The attorney general will not cast aspersions on my asparagus”), was an excellent exchange between Rep. Mel Watt and the Attorney General on the problem of copyright infringement and online streaming.

During this exchange, the Attorney General notes that the Department of Justice is limited in its ability to prosecute criminal organizations or terrorists who would use illegal online streaming to finance their operations and called on Congress to create stiffer penalties for these violations. Right now, the Department of Justice can only bring up misdemeanor charges for these violations. It’s worth remembering that Congress already tried to fix this loophole once. In 2011, Sen. Klobuchar introduced S. 978 which made it a criminal offense to engage in large-scale, for-profit piracy using online streaming. Opponents of the legislation launched an outlandish (but unfortunately successful) smear campaign in which it accused Sen. Klobuchar of wanting to put Justin Beiber in jail.

If you want to watch the exchange, it starts at approximately 1:40:00 in the video from the full hearing.

Or see the excerpt here or read below for a rough transcript:

Watt: The administration has called on Congress to make illegal distribution by streaming a felony. Can you describe the current tools at the Department’s disposal to combat copyright infringement? And how would classifying streaming as a felony enhance the Department’s enforcement efforts in this area?

Holder: I think what we are looking for are just an expanded set of tools so that we can have a prosecution and enforcement efforts that’s consistent with the nature of the harm. All we can do now is bring a misdemeanor charge, and sometimes these crimes involve thousands, potentially millions of dollars, where a felony prosecution might be appropriate. We are not saying that we should only have a felony capability but we think we should have felony capability in addition to the misdemeanor capability that we already have that would take into account the nature of the crime that we are looking at.

Watt: According to World Customs Organization the international sales of counterfeit goods is a multi-billion dollar industry.  Many of the sales are increasingly made over the internet where criminals can hide their identities and elude capture. What steps has the department made to educate the public on the safety and security risks posed by these elicit sales?

Holder: That is a problem that we have tried to really focus on in terms of educational efforts. There are medicines that are stolen, intellectual property stolen, that put the public health at risk. We have found in some of our airplanes bolts that were inappropriately made. What we have tried to do as part of our enforcement efforts is to educate the public and to educate businesses about the dangers that flow from the theft of intellectual property.

Watt: Are there increasing indications of links between this problem and terrorism? Have you found any of those links and would you describe those for the committee?

Holder: Yes, I think that is actually a very good question. And I think it’s something that is very worrisome. As we saw organized crime get into a variety of businesses in order to support their efforts, we are now seeing terrorists groups getting into the theft of intellectual property, again, to generate money to support what they are trying to do for their terrorist means. And so it means we have to broaden our enforcement efforts, broaden the investigative efforts that we take, to examine what are the precise reasons why people are engaging in this kind of intellectual property thievery and to consider, unfortunately, whether or not there is a terrorist connection to it.  But that is, I think, a relatively new phenomena but one we need to be aware of.

Watt: And are there steps that you would recommend Congress consider to check the growth of this industry?

Holder: Yes, this is something I think we should try to work with Members of this Committee and more generally with Members of Congress about. I am particularly considered about the theft of intellectual property to support terrorist activities. And it would seem to me that in those instances, enhanced penalties might be appropriate, and so I think that is something working with Congress we should consider.

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About the author

Daniel Castro is a Senior Analyst with ITIF specializing in information technology (IT) policy. His research interests include health IT, data privacy, e-commerce, e-government, electronic voting, information security and accessibility. Before joining ITIF, Mr. Castro worked as an IT analyst at the Government Accountability Office (GAO) where he audited IT security and management controls at various government agencies. He contributed to GAO reports on the state of information security at a variety of federal agencies. He has a B.S. in Foreign Service from Georgetown University and an M.S. in Information Security Technology and Management from Carnegie Mellon University.