Subject: Fw: Database Protection Bill in the Senate - S 2291
patricem@ombwatch.org
Date: Thu, 16 Jul 1998 09:43:43 -0500
Date: Thu, 16 Jul 1998 09:43:43 -0500 From: patricem@ombwatch.org Subject: Fw: Database Protection Bill in the Senate - S 2291 To: roundtable@cni.org References: <Pine.GSO.3.95.980715195904.18197A-100000@well.com> Message-Id: <Chameleon.900597360.patrice@patrice.rtknet.org>
The message below contains information on a "new" bill and a
useful review of myths & facts about database copyright
protection (prepared by the Info Tech Ass'n of America).
Those folks who are concerned about access to govt info should
also be concerned about this bill -- its parent, HR 2652, would
give companies who used govt info control of the underlying
information -- i.e., public information.
Patrice
-------------------------------------
Patrice McDermott
patricem@ombwatch.org
OMB Watch
Date: 07/16/98
Time: 09:43:44
-------------------------------------
------------------------
From: Declan McCullagh <declan@well.com>
Subject: FC: EFF on new database protection bill in the Senate
Date: Wed, 15 Jul 1998 19:59:44 -0700 (PDT)
To: politech@vorlon.mit.edu
---------- Forwarded message ----------
Date: Wed, 15 Jul 1998 17:55:20 -0400
From: Alexander Fowler <afowler@eff.org>
To: declan@well.com
Subject: New Database Protection Bill in the Senate
Hi Declan,
I thought you might be interested to learn that last Friday,
July 10, 1998, Senator Grams (R-MN) introduced S. 2291, "The
Collections of Information Antipiracy Act." Sounds familiar,
right? Well, it should since this is the proposed companion
legislation to a controversial bill under the same name that
already passed the House this year (H.R. 2652).
Both bills are intended to add to existing copyright and
misappropriation law new protections on access to and use of
compilations of information (read "databases"). Such
protections are very similar to those once available under the
so-called "sweat of the brow" doctrine of copyright law. It is
interesting to note that "sweat of the brow" arose early in
this century, was the object of persistent scholarly criticism,
fell from favor by the 1980s, and in 1991 was held to be
unconstitutional by the Supreme Court.
As has characterized many of the develops with regard to H.R.
2652, this new Senate bill slipped into the Congressional
record without much fanfare or discussion. Proponents of these
bills, which include a few, very powerful database companies
like Reed-Elsevier and West Publishing, will tell you this is
because they successfully resolve a noncontroversial set of
issues. However, this is far from the truth, as a wide array
of commercial and noncommercial groups oppose both bills,
including AT&T, MCI, AAAS, IEEE, ACM, EFF, to name only a few.
Given Congress' sporadic schedule this year, my concern is that
unless more pressure is put on the Senate to convene hearings
on this issue, it is likely that something could pass the
Congress and go to the President much like the "No Electronic
Theft Act" (H.R. 2265) did late last year.
I'm forwarding you a copy of a very well written review of the
myths and facts about The Collections of Information Antipiracy
Act that was produced by the Information Technology Association
of America.
Sincerely,
Alex Fowler
EFF
MYTHS AND FACTS ABOUT H.R. 2652 --
THE COLLECTIONS OF INFORMATION ANTIPIRACY ACT
[Produced by the Information Technology Association of America,
http://www.itaa.org/database.htm, last updated on June 15,
1998.]
Myth: The database industry has suffered since the Supreme
Court found "sweat of the brow" protection for compilations
unconstitutional in 1991.
Fact: The database industry has grown at a phenomenal rate
since
1991:
Between 1991 and 1997, the number of database increased
from 7637 to 10338, an increase of 35%;
Between 1991 and 1997, the number of files contained
within databases increased from 4 billion to 11.2 billion, an
increase of 180%;
Between 1991 and 1996, the number of online searches
increased from 44.4 million to 79.9 million, an increase of
80%.
Just as significant as the growth of the industry is its
changing structure. In 1977 government, academic, and
non-profit entities produced 78% of all databases, while the
private sector produced only 22%. By 1991, the government,
academic, and non-profit share dropped to 30%, while the
private sector share increased to 70%. Since 1991, this
privatization has continued; by 1997, the government, academic
and non-profit share had fallen to only 22%, while the private
sector share soared to 78%. The shift in market structure,
combined with the increase in the absolute numbers of
databases, indicates that private investment in database
creation has increased since Feist.
Myth: H.R. 2652 will not lead to an increase in the price of
databases.
Fact: Between 1986 and 1996 the consumer price index increased
44%, and the price of health care increased 84%. The price of
subscriptions to scholarly journals, which consist of
"collections of information" and often are published by
commercial firms, increased by 148%. If the price increased
this much when there was no special database protection and
competition was possible, imagine how much it will increase
after H.R. 2652 grants database compilers a legal monopoly.
Myth: H.R. 2652 is necessary to ensure database publishers with
an adequate return on their investment.
Fact: The Dutch-British conglomerate Reed Elsevier, one of the
major supporters of H.R. 2652, publishes many scientific
"collections of information." The profit margin of Reed
Elsevier's science section in 1996 was almost 42% -- even
higher the Microsoft's profit margin of 35.5%!
Myth: Existing law does not provide databases with sufficient
protection.
Fact: The proponents of H.R. 2652 base their entire argument on
one case: the Eleventh Circuit's decision in Warren Publishing.
We believe that the Eleventh Circuit misapplied the copyright
law in that case, and reached the wrong conclusion. But the
courts have reached the right conclusion in the vast majority
of the copyright decisions relating to databases -- cases never
mentioned by H.R. 2652's proponents. For example, the Ninth
Circuit recently found that copyright did reach the CPT
database of the American Medical Association -- another of H.R.
2652's supporters. The Ninth Circuit withheld protection from
the database, however, because the AMA misused its copyright.
As it seeks to regain protection through H.R. 2652, the AMA
neglects to mention that it disqualified itself from existing
protections by virtue of its misconduct.
Furthermore, database publishers can rely on numerous other
forms of protection, including trademark, trade secret,
contract, state common law misappropriation, and technological
protection. It should be noted that the Senate recently adopted
S. 2037, which bolsters technological protections by
prohibiting their circumvention.
Nonetheless, unfair commercial predation of databases should
not be tolerated, and a statute directed specifically at this
problem merits serious consideration.
Myth: H.R. 2652 simply tries to restore the status quo prior to
the Supreme Court's 1991 Feist decision finding "sweat of the
brow" protection unconstitutional.
Fact: The "sweat of the brow" doctrine -- granting copyright
protection to the facts in a compilation as a reward for the
effort invested in gathering the facts -- was never the
prevailing approach for the protection of compilations; it
existed in tandem with the more mainstream approach of
protecting only the expression in the compilation. Sweat of the
brow began to decline with Congress' adoption of the Copyright
Act in 1976, and it was in full retreat by the 1980's. The
Feist decision in 1991 was just the final blow. In short, H.R.
2652 tries to turn the clock back more than twenty years; since
the 1976 Act, database publishers have known they could not
rely upon the sweat of the brow doctrine.
Moreover, H.R. 2652 is far broader than the "sweat of the brow"
doctrine. Courts created sweat of the brow as a stop gap
measure to protect a narrow class of directories in which there
was no protectable expression. H.R. 2652, by contrast, applies
to collections of information even if they qualify for
copyright. For this very large class of databases, H.R. 2652
allows publishers to charge more with no off-setting societal
benefit. Further, H.R. 2652 prohibits transformative uses of
the information -- re-use of the information in different
kinds of products. Sweat of the brow was not applied in such
a far reaching manner. H.R. 2652 thus represents a radical
departure from the way information traditionally has been
treated in the country.
Myth: H.R. 2652 is required to assure protection for U.S.
databases in Europe.
Fact: While the European Database Directive will deny sui
generis protection for U.S. databases if similar protection
does not exist here, the Directive will still afford copyright
protection to those U.S. databases. And since several European
countries currently do not offer adequate copyright protection
for databases, the Directive will actually improve matters for
U.S. databases relative to the status quo. In other words, U.S.
companies will be no worse off that they are now, and indeed
might be better off. Also, U.S. companies can receive sui
generis protection if they simply establish subsidiaries in
Europe -- something many of the proponents of H.R. 2652 already
have. Finally, as its proponents have admitted, H.R. 2652
probably would not satisfy the Database Directive's reciprocity
requirement, because it is based on a tort rather than a
property approach.
In any event, we should not let the European Community dictate
what our laws should be. To the contrary, we should challenge
the Database Directive's reciprocity provision before the World
Trade Organization.
Myth: H.R. 2652 will protect small businesses.
Fact: While H.R. 2652 may benefit a few small database
publishers, it will harm far more. Most small database
publishers are value added publishers; they extract
information from existing databases and add value by inserting
new information or arranging the information in a new way. H.R.
2652 will allow the large upstream database publishers to drive
the small value-added publishers out of business. Thus, it
should come as no surprise that the driving forces behind this
legislation are Reed Elsevier and Thomson (the Canadian company
which bought West Publishing) -- two of the world's largest
publishing houses.
Myth: H.R. 2652 will not harm research activities.
Fact: H.R. 2652 is opposed by the American Association for the
Advancement of Science, the Institute of Electrical and
Electronics Engineers, and many universities because of the
negative impact it will have on the collaborative methodology
of research. Currently, observation made by different
scientists in different institutions are pooled together in
databases which form the basis for analysis by still other
scientists. H.R. 2652 will create disincentives for the sharing
of data, which in turn will retard the advancement of
knowledge. H.R. 2652 will also erect barriers to the writing of
survey articles and textbooks; when the author of a textbook
extracts data from a scientific article, he is harming the
"potential market" for a product including that data -- a
textbook written by the scientist who wrote the article.
To be sure, H.R. 2652 does include an exception for non-profit
research, but that exception is circular. It applies only if
the extraction or use does not harm the actual or potential
market for the information -- the basic test for all
extractions and uses under the bill, and a test which as noted
above many research uses cannot meet.
Myth: H.R. 2652 will not harm businesses outside the database
industry.
Fact: H.R. 2652 will increase the costs of information for all
businesses. Additionally, H.R. 2652 will allow database
publishers to control the use of information by its business
customers. Currently, businesses buy information such as
customer lists and reconfigure them for internal use. Under
H.R. 2652, a database publisher can claim that this
recompilation harms a "potential market" for its database.
Further, companies which rely on scientific will suffer from
H.R. 2652's adverse impact on science.
Myth: H.R. 2652 does not protect information -- just
collections of information .
Fact: H.R. 2652 prohibits the extraction or use of a
quantitatively or qualitatively substantial part of a
collection of information. A relatively small amount of
information could be considered "qualitatively substantial."
Moreover, the second comer would have no way of knowing in
advance what information he could extract before crossing the
line; thus, as a practical matter, H.R. 2652 affords protection
to a relatively small amount of information within a
collection.
Myth: H.R. 2652 contains sufficient safeguards against monopoly
pricing by sole source databases.
Fact: The only safeguard provided by H.R. 2652 is a savings
clause that the antitrust laws apply to sole source databases.
This provides little comfort, given the expense and duration of
antitrust litigation and the prevalence of sole source
databases. Most database markets are so small that they are
served by one supplier.
Myth: Potential adverse impacts of H.R. 2652 have been grossly
exagerrated because it does not prevent people from gathering
the information themselves.
Fact: In many cases, the publisher of the database controls the
underlying information, making independent compilation
impossible. For example, one of the databases the AMA seeks to
protect is its membership list. The AMA maintains such a list
as part of its function as the organization that represents and
regulates the medical profession in the U.S.; it would be a
practical impossibility for another entity to create a list of
all the doctors in the U.S. from scratch. Similarly, the New
York Stock Exchange maintains information on all the stock
quotations as part of its function of administering the stock
market. There is no practical way for an entity other than the
stock exchange to assemble a complete set of stock quotes.
Additionally, historic data often is available only from
publishers who have been in business for a long time; old court
decisions are available only from West and Lexis-Nexis, which
copied West's databases. Ironically, Lexis-Nexis, part of Reed
Elsevier, now seeks to prevent the very sort of copying that
allowed it to create its database in the first place.
Beyond the impossibility of recreating a database in some
cases, there is the fundamental information policy question of
whether we want to require people to invest time and energy in
recollecting information that has already been collected --
reinventing the wheel. For over two hundred years, the answer
has been no. The Senate must decide if now is the time to
change this bedrock principle.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Alexander Fowler
Director of Public Affairs
Electronic Frontier Foundation
E-mail: afowler@eff.org
Tel/Fax: 202 462 5826 (East Coast)
Tel: 415 436 9333; Fax 415 436 9993 (West Coast)
You can find EFF on the Web at <http://www.eff.org>
EFF supports the Global Internet Liberty Campaign
<http://www.gilc.org>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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