Why do you think the Induce Act died in Congress this year, even though it had the support of the MPAA and RIAA?
Neither Sharman Networks nor any of the other peer-to-peer companies were invited to participate in those negotiations. We were just labelled as bad actors, while other people talked about the method and timing of our execution.
Do you think the entertainment industry overreached by asking for too much?
Yes. Particularly the way they did it. It became known that the RIAA and MPAA had been working with Senate staff on that language for over a year. Then suddenly this was put on the table, and the other side is told: "You have two months to reach a deal."
I can't think of any precedent for parties in a legal case coming to Congress and saying, "We're losing the case under current law. Can you change the law so we can win?" I think it's very unseemly. [Ed. note: The Induce Act was designed in part to overturn court decisions saying that the Grokster and Morpheus file-swapping networks were legal to operate.]
That's a procedural objection -- if you had time to review the Induce Act and the legal case was over, would you still object?
I learned (early on) to respect the legislative process. Whether or not you agreed with the legislation that was enacted, the process resulted in better legislation. Most of the copyright proposals that we've seen in the last few years, if they had gone through the regular process, would not have gone as far.
It's clear that they'd like to create a new cause of action of secondary infringement that would penalise new technologies and business models. That's very dangerous. Hollywood with its very deep pockets would use a law like that to crush new companies that were guilty of nothing.
Could you ever agree with the idea that a company should be legally liable for inducing infringement on a peer-to-peer network?
I, on behalf of my client, could never agree. Why would they ever agree to a change in the law that will leave them open to fighting a new lawsuit -- when this is very beneficial technology, and they've never done anything to indicate they encourage or look the other way about copyright infringement?
Looking ahead, what do you think of the idea of imposing a new tax -- perhaps on Internet connections -- to compensate content owners for losses caused by piracy?
I think the best way to reduce piracy on peer-to-peer networks is for the content owners to license their content in a way that's attractive. There's always going to be some unauthorised distribution going on. [There has been discussion] of having some kind of compulsory licence that would compensate copyright holders. My client's not advocating it, but they think it's worth looking at.
Would you ever rule out lobbying for an Internet provider tax?
This is an issue for Congress to consider. When I first began lobbying for Sharman, we did write [a policy paper to] Congress to suggest what we called an intellectual property use fee.
