[Congressional Record Volume 151, Number 87 (Monday, June 27, 2005)] [House] [Pages H5226-H5227] From the Congressional Record Online through the Government Publishing Office [www.gpo.gov] INTELLECTUAL PROPERTY AND THE GROKSTER DECISION The SPEAKER pro tempore. Under a previous order of the House, the gentlewoman from California (Ms. Linda T. Sanchez) is recognized for 5 minutes. Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I rise to applaud the United States Supreme Court for their ruling today in the case of Metro-Goldwyn-Mayer Studios, Incorporated v. Grokster. By a unanimous ruling, 9-0 in favor of MGM, the Supreme Court sent a strong message today that our courts will protect the work of creative artists. I represent the 39th Congressional District in California. My State, region, and district are home to the motion picture industry, the music industry, and software companies. Many of my constituents work in these creative industries, and I know from talking to them that piracy hits their companies hard and their pocketbooks harder. Intellectual property is important to our economy as a whole, so copyright infringements also severely damage our national economy. In fact, according to the International Intellectual Property Alliance, in 2002, core copyright industries accounted for over 6 percent of the U.S. gross domestic product. That is over $626 billion. When you look at all copyright industries, they accounted for approximately 12 percent of the U.S. gross domestic product, or $1.25 trillion in 2002 alone. Obviously, intellectual property is a vital part of our economy, and piracy robs our economy of billions of dollars from this important industry. {time} 2030 Conservative estimates say that counterfeiting of U.S. businesses' copyrighted goods cost our economy between $200-$400 billion each year. When our economy suffers like that, America's workers suffer, too. The ``core'' copyright industries alone were estimated to have employed 4 percent of U.S. workers in 2002, a total of 5.48 million workers. But piracy causes 750,000 American workers to lose their jobs each year. This is where intellectual property laws come in and why the Supreme Court decision today in the Grokster is so important. The Court drew a line in the sand in the Grokster case and said that peer-to-peer file- sharing networks that encourage illegal file-sharing should not be shielded by our laws. The ruling protects the creative community but also allows the public to retain access to the benefits of peer-to-peer file-sharing technology. Mr. Speaker, I love movies and music as much as any consumer, and I use computer software every single day. I am also a fan of the Internet, and I want consumers to be able to use technology to get their favorite music and movies conveniently. But stealing is stealing. Swapping copyrighted files online is illegal, and just because it is easy doesn't make it right. We can have peer-to-peer networks that give every American access to the files they want online, and also provide creators with copyright protections. As long as companies like Grokster are allowed to facilitate illegal file swapping, we will continue to lose hundreds of dollars and hundreds of thousands of U.S. jobs each year. I am pleased that the Supreme Court took the first step today in Grokster towards ending illegal copyright infringement online, and protecting the industries that produce copyrighted works. Mr. CONYERS. Mr. Speaker, today's ruling is a victory for content creators and consumers. It is clear that those who encourage content theft are responsible for their conduct even if they themselves are not stealing. With this ruling, creators will be encouraged to take advantage of the digital marketplace and provide consumers with even more digital content. For years, consumers have been clamoring for access to digital content. Because content protection technology and content owners had not caught up with the Internet, music lovers turned to illegal download sites like Napster and Kazaa for digital content. We had heard that, if the content industry would just create a legal avenue for obtaining digital music, consumers would embrace it. The premonition was largely true. The record industry and high-tech worked together to develop digital content protection, to clear the rights needed to get music online, and to get music on the Internet. According to the Pew Internet and American Life Project, the response to legitimate digital content has been overwhelming: in 2004, only twenty- four percent of music downloaders had tried legitimate download sites; in 2005 to date, the number jumped to forty-three percent. Internet sites like Apple iTunes, Napster, and Rhapsody offer consumers a variety of ways of obtaining music, from one-time downloads to monthly subscriptions. In just the past few years, over 300 million songs were sold on just a single website. No matter how you view it, the marketplace is working. Today's Supreme Court decision makes it clear that encouraging others to steal is as nefarious as stealing directly. I have no doubt that, with this added assurance, content creators will roll out even more digital content to consumers. Mr. ENGEL. Mr. Speaker, I rise to join my Democratic colleagues in support of protecting our Nation's intellectual property. For decades the theft of music and movies has been commonplace. But, with the explosion of the Internet, the theft of copyright material has become a crisis. Just today, the Supreme Court, in an unanimous decision, stepped forward and protected Intellectual Property. In MGM v Grokster, the Supreme Court struck a fine balance that must exist to ensure consumers' rights and protect music and video content. The Court clearly stated that ``the record is replete with evidence that from the moment Grokster and Streamcast began to distribute free software, each one clearly voiced the objective that recipients use it to download copyrighted works, [[Page H5227]] and each took active steps to encourage infringement.'' Neither of these programs offered themselves as legitimate devices such as a VCR. A great majority of users knew and intended to subvert copyright and deny not just the record and movie companies' compensation, but take money out of the pockets of songwriters, studio personnel, camera men and make-up artists. We are also undertaking an effort to move to digital television. In the future, if the Congress does not act, copying and uploading a broadcast show will be all too easy. Many of us have worked on the ``Broadcast Flag,'' which is a technology that will allow consumers to continue to record a show for later viewing, but prevent the mass redistribution. The Federal Communications Commission had instituted a rule to this end, but the federal courts found the FCC lacked such authority. Thus, it falls on us in Congress to continue to update our laws in the digital era to stop copyright infringement. I hope we can do so quickly or, I fear, the best entertainment will be moved to cable and satellite and be unaffordable to some Americans. I thank Mr. Hoyer and Mr. Schiff for arranging this effort and applaud all of my colleagues' commitment to the protection of one of our Nation's most valuable assets. ____________________