Legislation to enact strict criminal penalties on software pirates in cyberspace was passed by a House subcommittee today.
Under the No Electronic Theft Act, parties could be found guilty of piracy even if they never profit by sharing, bartering, or exchanging unauthorized copies of intellectual property on the Net or via a computer.
The original version of the so-called NET Act imposed felony penalties for those who "willfully" made or possessed ten or more illegal digital copies of software, music recordings, or film clips worth at least $5,000. An amendment adopted today lowered the value of pirated material to $2,500 for a felony offense. If found guilty, offenders could get up to three years in prison.
The revised bill also added more stringent requirements for law enforcement when filing misdemeanor charges. Until today, the bill required that a violator only had to possess one copy of pirated material with no specified retail value to qualify for a misdemeanor.
"Instead, under the amendment, they'd have to show that ten infringing copies were made with a retail value of $1,000 or more," said Mark Traphagen, intellectual property trade policy counsel for the Software Publishers Association. "To be charged, you need to know that its against the law and go ahead and do it anyway." The misdemeanor offense carries up to a one-year jail term.
The SPA supports passage of the bill, which now goes before the full House Judiciary Committee. According to software industry trade groups, worldwide losses due to piracy exceeded $11.3 billion last year.
The U.S. Copyright Office also endorsed the legislation. But during hearings about the bill earlier this month, the telecommunications industry was concerned that the bill went too far.
"The bill spreads its reach too widely, jeopardizing in the process actors whose conduct in no sense warrants invocation of criminal sanction," the United States Telephone Association told Congress.