Copyright Hearing Examines IP's Intersection with Innovation

As part of the House Judiciary Committee’s Subcommittee on Courts, IP, and the Internet’s ongoing assessment of copyright, a hearing was convened on Thursday titled Innovation in America: The Role of Technology.   The hearing was billed as an opportunity to hear from the technology community and build on last week’s creator’s panel, which focused on the often-overlooked relationship between the two communities and their resolve to work together to innovate. 

Subcommittee Chairman Coble marked his return to the Subcommittee after surgery last week, introducing the hearing by calling it a discussion of the “future . . . rather than the past,” and he asked that witnesses touch on what is to come, as well as what they need from government to meet these innovations.  He briefly noted the fact that “technology has forever changed the world in which we live,” acknowledging that technology depends “on [a] robust intellectual property system.”  Chairman Coble then turned to Rep. Watt, who reflected briefly on last week’s hearing.  He echoed the hearing’s sentiment that the “marriage between technology and content . . . is unmistakable . . . ” and we “have a stake in making it work.”  Full Committee Chairman, Rep. Goodlatte also provided an opening statement. 

The panel of interested parties included a slice of the tech field that at times seemed more interested in patent litigation than the copyright issues at hand. The five witnesses were Danae Ringelmann (Founder & Chief Customer Officer, Indiegogo), Jim Fruchterman (President & CEO, Benetech), Nathan Seidle (CEO, SparkFun Electronics, Inc.), Rakesh Agrawal (Founder & CEO, SnapStream Media), and Van Lindberg (VP of Intellectual Property, Rackspace). 

Ringelmann started her testimony with an introduction to her crowdfunding company, IndieGogo, which she founded as a way of solving “the inefficiency of finance.”  Through examples of different fundraising campaigns on IndieGogo, she drove a message that stressed innovation drives technology and technology drives innovation.

Fruchterman followed with a discussion of his non-profit organization, which primarily maintains a book-sharing library for the blind.  The library, which delivers ebooks digitally, crowdsourced the content by having volunteers scan the books and then make them available.  His organization was probably the most closely tied to copyright, allowing him to highlight existing sections of the Copyright Act as the basis for innovation; he pointed to Section 121 and Copyright Act’s protection of fair use.  He cited fair use as the bedrock of what allows them to provide ebooks to more than “a quarter of a million American students” for “1/15th” the cost of the traditional book.

Seidle, whose testimony almost exclusively examined patents, runs an e-commerce company that sells products and provides resources for individuals building or creating tech projects.  He held out his business as a model for why businesses do not need intellectual property protections; this point later drew criticism from Representatives during questioning, as it appeared to be a blanket statement to dismiss IP protections in favor of a completely open-source system, based on a single anecdote.  He departed from some of the other panelists in saying that innovation is not tied to IP and moreover that he believes innovation is being hampered by IP litigation.  Throughout his testimony, he noted his limited experience with patents but still attempted to use patents as a basis for statements about IP generally.

Agrawal, like Fruchterman discussed the importance of existing fair use exceptions to his business.  His company, which functions like a DVR and empowers clients to quickly and easily find and record television on a commercial scale, is the basis for shows like the Daily Show, Colbert Report, and the Soup.  He also pointed to local and national news media, as well as the government as active users of his company’s technology.

Batting cleanup, as Coble introduced him, Lindberg reflected on last week’s hearing on copyright and innovation, admitting “in truth [technology and copyright content holders] are not so far apart.”  He briefly discussed the importance of copyright by warning Congress that restrictive “changes to copyright law [will] make sharing more difficult.”  He was also wary of tailoring copyright law to a single business model, as new models drive businesses and create jobs.

The panel then opened for questions, which ran the gamut from interest in how individual creators factor into Seidle’s dismissal of IP law protections to the patent law system’s shortcomings.

Chairman Coble and Rep. Chu kicked off the questioning; Rep. Chu honed in on Lindberg’s dismissal of piracy, asking about the individual songwriters who use the copyright act to protect their own innovation.  Lindberg largely agreed that copyright holders rely on copyright to disseminate works and that they should be able to do that; he stated that he “fully support[s the] ability of content creators to make decisions about their content” but qualified his statement by discussing the new business models that are impeded by copyright.

Rep. Marino used Seidle’s contentions about patents to highlight the dangers of permitting piracy or removing IP protections.  His exchange with Seidle focused on Seidle’s statement that there is greater technological innovation in the absence of patents, simply based on his own company’s experience.  Seidle used a few examples but appeared to miss Rep. Marino’s point that open source is a choice that creators have and that copyright protections should be there for those who choose to use them.

Rep. Deutch, like Rep Marino also honed-in on IP protections as a choice.  While he commended Seidle for creating a thriving business without patents, he was skeptical of using what is likely an outlying example as a success story representative of the greater community’s experience with intellectual property protections.

Rep. Jeffries circled back to the interdependence of copyright and technology with the point that “co-existence [is] mutually beneficial.”  He pointed to both Fruchterman’s and Agrawal’s businesses as benefiting from the existence of copyright, saying that Benetech benefits from of creation of books, and SnapStream benefits from the creation of television. 

In closing, Rep. Watt entered a letter from the National Writers Union into the record.  The hearing will be the Subcommittee’s final hearing on copyright before the August recess, which begins on August 2nd.  The Subcommittee is expected to pick up their examination of copyright when Congress returns this fall.