IP enforcement reforms proposed by the Obama Administration

The US Administration has recently released “The Administration’s White Paper on Intellectual Property Enforcement Legislative Reforms”.  This White Paper contains 20 recommendations on IP enforcement, and the implication is that the recommendations will form part of legislative amendments that are presented to Congress during the term of the administration.

The key recommendations set out in the White Paper are:

  1. Illegal streaming of content: In response to changes in the technology used by infringers, the Administration recommends that infringement by illegal streaming or other similar new technology should constitute a felony.
  2. Wiretapping authority: The Administration recommends that wiretapping authority be given to law enforcement authorities for criminal copyright and criminal trademark offences.  This is intended to assist with targeting organised crime and its leaders.
  3. Increasing statutory maximum criminal penalties: The Administration recommends increasing criminal penalties for economic espionage and drug offences (especially counterfeit drug offences) under the Federal Food, Drug and Cosmetic Act (FFDCA).  Currently, the statutory maximum for these offences is 15 years for economic espionage and 3 years for drug offences. The Administration recommends that this be increased to at least 20 year in prison for economic espionage but did not quantify what the increase should be for drug offences.
  4. Increasing Sentencing Guideline ranges:  The White Paper recommends increasing the Sentencing Guideline ranges applicable to offences relating to intellectual property.  Increases are recommended for theft of trade secret, economic espionage, copyright and trademark infringement, recidivist intellectual property offenders and intellectual property infringements involving organised criminal enterprises, counterfeit pharmaceuticals or where a infringer knowingly sells infringing products for military or law enforcement.  
  5. Power to share information with rightholders:  The White Paper recommends that the Department of Homeland Security (DHS) be given powers to inform rightholders of potential infringements pre-seizure of allegedly infringing goods.  A similar right to inform pre-seizure is recommended where Government authorities discover devices that can be used to circumvent technological measures used to control access to copyrighted works.  In both cases, the intent is that these pre-seizure communications will help the DHS to determine whether or not items are infringing or are circumvention devices.  Similar powers to inform rightholders after the potentially infringing good or circumvention device is seized are also recommended.  It is intended that post-seizure communications will assist rightholders to combat and investigate upstream infringements and potentially alter their technological controls to undermine the effectiveness of circumvention devices.  
  6. Counterfeit drugs:  In addition to the changes to statutory maximum sentences and Guideline ranges (see above), the Administration recommends that a track-and-trace system be introduced for pharmaceuticals and related products and that importers and manufacturers notify of any counterfeit drugs or medical products (and its potential health risks) it discovers.  The White Paper also recommends amendments to the FFDCA, including introducing forfeiture authority for counterfeit drug offences. 

In addition to these key recommendations, the White Paper also recommends that sound recording owners be given the right of public performance transmitted by over-the-air broadcast stations, and that new powers be given to the US Customs and Border Protection service to issue penalties relating to the export and import of infringing products.

Taken together, the White Paper recommendations will significantly change the current US IP enforcement regime.  The White Paper has already generated debate in the blogosphere, and it will be interesting to see whether all of the recommendations make their way into amending legislation.

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