Hollywood waits to see how plan will be implemented

Entertainment executives took to Capitol Hill on Wednesday to express support for a White House plan to fight piracy, characterizing it as the kind of coordinated campaign so far lacking in efforts to fight rampant copyright infringement.

The pressing question now is how the 61-page plan, unveiled Tuesday, will be implemented. The White House “copyright czar” Victoria Espinel, business and labor leaders testified before the Senate Judiciary Committee that the plan, which is heavy on strengthening enforcement efforts, is a necessary initial step. It’s unclear what specific legislative action will be needed to move forward.

“We acknowledge that no silver bullet exists, either in the public or private sector, that can fully eradicate the problem of piracy,” Warner Bros. chairman and CEO Barry Meyer told the committee. He said it must be pursued on a variety of levels and with numerous approaches that feature vigorous enforcement and cross-industry cooperation to prevent infringement.

The judiciary committee was holding an oversight hearing on the newly established office of the Intellectual Property Enforcement Coordinator, Espinel’s official title.

Committee chairman Sen. Patrick Leahy (D-Vt.) reminded the gathering that the impact of illegal knockoffs is widespread in the economy, including phony pharmaceuticals and even counterfeit microchips acquired by the Defense Department. But the lion’s share of the hearing was devoted to the impact that a coordinated enforcement campaign could have on Hollywood and the music industry.

Meyer detailed how piracy affects the industry’s economic model including residuals, a point echoed by labor exec Paul Almeida, president of the Department for Professional Employees, AFL-CIO. “Estimates of the jobs lost to piracy in this sector alone is in the hundreds of thousands,” said Almeida. But online theft also robs workers of residuals and other benefits, he said.

Sen. Al Franken (D-Minn.), who said he remains a member of the WGA, SAG and AFTRA, claimed he can personally testify to the importance of residual checks. “I still get a $12 check whenever they play ‘Trading Places,’ ” said the former writer/actor for “Saturday Night Live.” The comment prompted a disclosure from Leahy that he also receives an occasional check for three appearances in Warner Bros.’ “Batman” movies.

Music publisher Caroline Bienstock said family-owned operations such as hers are especially hard hit by today’s rampant piracy because of their limited number of revenue streams. “We have a generation that has grown up thinking that music should be free, (and) an attitude that the Internet is superior to intellectual property,” she told the panel. She said increased enforcement should be accompanied by educational efforts.

Sen. Sheldon Whitehouse (D-R.I) said he is troubled that legitimate businesses are indirectly supporting Internet piracy, including Internet service providers, search engines and even credit cards that process the payment of pirated films. He asked the panel of witnesses why they haven’t taken action against these firms. “I would have thought your lawyers would have been there in 30 seconds,” he said.

Meyer said the industry is examining such “enabling practices,” but said doing so faces technological problems. He also pointed out that rapidly evolving digital technology is a double-edged sword. While it gives distribs new platforms to market their products, staying ahead of the pirates remains a constant battle.

Espinel offered details of the plan, stressing the importance of broad interagency cooperation that she said would address prevention and enforcement. She said the plan would boost cooperation with state and local law enforcement, increase training for personnel and establish groups to address specific issues.

Franken told Espinel that he remains concerned about “network neutrality” as it relates to Internet piracy. “I want to know how you put in place measures to protect against piracy that don’t impede the free flow of info on the Internet,” he said. Espinel replied that net neutrality “does not apply to unlawful content including the distribution of counterfeit products.”

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