"American business is under assault from counterfeiters and pirates every day, seven days a week," Mr. Morton said. "Criminals are stealing American ideas and products and distributing them over the Internet."
Now, this statement has all sorts of problems, and it's scary that a government official -- and one with the ability to outright seize domain names, would make so many false claims in a single quote. First of all, the evidence suggests that American business is not, in fact, "under assault" from counterfeiters and pirates. In fact, we've detailed a whole series of studies that suggest counterfeiting is not nearly as big a problem as the industry makes it out to be. In fact, studies have repeatedly shown that counterfeits are rarely even substitute products, as many buyers aren't being "fooled" at all, but are using the products as a way to build up to the real thing. There are a few areas where counterfeiting is serious -- such as with faked drugs -- but, even then, the "risk" is often overblown, as big pharma companies pretend that mere generics are also "counterfeits," when they're really just cheaper competition.
Of course, even more insidious is Morton's regular mixing of "counterfeiting" and "copyright infringement" -- which are two extremely different things. In his statement, however, he seems to rely on whatever is "worst" for what he's talking about. Counterfeit products seem like a bigger problem than straight copyright infringement, so he puts that first as saying "counterfeiters" are a problem. But, of course, the websites seized have nothing to do with counterfeits, so he switches and pretends he's talking about copyright, saying that "criminals are stealing American ideas and products and distributing them over the Internet." Except you can't "steal an idea." It's simply not possible. Nothing is missing. You can copy an idea -- but an idea is not copyrightable -- only an expression is. You would think that someone representing the US government, seizing domain names over copyright infringement would know that you can't copyright an idea.
So, given all of this, I have the following questions for Mr. Morton, anyone else at Homeland Security or in the Obama Administration, or those who support these domain seizures:
Under what legal mandate is a group that's supposed to be focused on Immigration and Customs getting involved in taking down websites? What does a website have to do with either immigration or customs?
Since the original seizures were announced at Disney, is it common practice for Homeland Security and/or ICE to focus on using their guns and power of raids and seizures in efforts that are designed to help specific companies?
Since at least some of the websites taken down were search engines that hosted no infringing material, how does Homeland Security/ICE make sure that it is not seizing domain names incorrectly (as it appears to have done in this case)?
Since we thought the US believed in due process, how does seizing domain names, prior to any adversarial trial, fit with the concept of innocent until proven guilty? And, yes, I'm well aware of the right to seize property as part of an investigation, but when dealing with websites, we are talking about a form of speech that has a much higher burden before it can be stopped -- so I'm curious for the government mandate on seizing domain names prior to a trial?
John Morton has made numerous claims of "harm" from these websites, but has not shown any evidence (publicly) to support those claims. Considering that the GAO and OECD's own reports question whether or not there is any such harm, can Morton show us which reports he relied on in proving "harm" before getting a court order to seize those domains? One would hope that the evidence of "harm" would come from more than a few companies, who haven't adapted to modern technology, merely claiming so. Hopefully Morton or others can show us the evidence.
I figure if we're going to allow Immigrations and Customs officials to suddenly start censoring the web, they should at least be able to answer those questions.
We already wrote about the recent Congressional committee hearings on intellectual property enforcement, where IP Czar Victoria Espinel blamed China. However, there were other speakers there as well, and perhaps the most interesting was from John Morton, the assistant secretary of Homeland Security's Immigration & Customs Enforcement (ICE) division -- the group that recently started working for Disney and seized a bunch of domains using questionable legal theories. We're still trying to figure out what the hell immigration and customs enforcement has to do with internet file sharing, and here was a chance to set the record straight.
In his opening remarks to the event, Rep. Howard Berman (who has been called the Representative from Disney, so it fits that he's happy that ICE now works for Disney) highlighted how this operation was "innovative thinking." (pdf):
Most recently, I was interested to read about the initiative
undertaken by Immigration and Customs Enforcement, or ICE, to seize the domain names of
Web sites that were unlawfully offering first-run movies. That is exactly the kind of innovative
thinking the Vice President called for -- and I am curious to hear from Assistant Secretary Morton
on how it came about, the obstacles that you faced, and how we can scale Operation "In Our
Sites" to enterprises that facilitate the theft of music, books and other products prone to
counterfeiting.
Note the sly trick (lie) from Berman here: suggesting that copyright infringement and counterfeiting are the same thing. You'll see this quite frequently these days (hello, ACTA), because it's easier to show actual problems from counterfeiting -- and nearly impossible to show problems from infringement. So by simply pretending they're the same, everyone can pretend that the "harm" from infringement is much worse. Note carefully that whenever anyone talks about the specific "harm," it always relates to counterfeiting. But when they talk about the "problem" they talk about infringement. It's amazing that no one calls them on this stuff.
Morton's talk was basically anchored with this kind of deception. You can read the whole thing here (pdf) or the embedded version below:
Let's dig into some specifics:
Simply put, American business is under assault from those who pirate copyrighted material and produce counterfeit trademarked goods.
And, we're off, with a simple conflation of two totally different things. Counterfeiting and copyright infringement are not the same at all.
Criminals are stealing American ideas and products and selling them over the Internet, in flea markets, in legitimate retail outlets and elsewhere. From counterfeit pharmaceuticals and electronics, to pirated movies, music, and software, these crooks are undermining the U.S. economy and jeopardizing public safety. American jobs are being lost, American innovation is being diluted and the public health and safety of Americans is at risk -- and organized criminal enterprises are profiting from their increasing involvement in IP theft.
Except, of course, you cannot "steal" ideas. And notice how the paragraph moves seamlessly back and forth between counterfeit goods and infringement. If infringement on the internet is the real problem, then why are they talking about "health and safety" which has nothing to do with people watching movies online. Furthermore, the whole "selling them over the Internet" may apply to counterfeit goods, but I thought the whole problem with content online is that people aren't "selling" it but giving it away for free? Why conflate the two unless your sole purpose is to confuse?
Finally, the GAO just dinged the government for buying into bogus industry claims about "lost jobs" and diluted innovation. So why is a government official repeating them?
Intellectual property rights are intended to discourage thieves from selling cheap imitations of products, which are often far less safe or reliable than the original products.
Please, let's be clear: Trademark law is designed to prevent consumer confusion over such imitations. Copyright law is entirely different and is designed to create incentives that "promote the progress of science." But, again, Morton is carefully conflating the two, because it hides the weakness of the idea that Homeland Security has any role in dealing with internet file sharing.
Intellectual property rights also protect the actor, director, writer, musician and artist from having a movie, manuscript, song or design illegally sold by someone who had no part in the artistry of creating it.
While true to some extent, again, "sold" over the internet? Wasn't the whole problem that all this stuff is available for free?
This increase in access to the Internet, while of great benefit for global communication and commerce, represents a very real threat to America's film and music industries. Their products are extremely susceptible to Internet piracy, especially as bandwidth increases. As a result of this growing concern, ICE counterfeiting and piracy investigations are increasingly directed to web-based criminals.
You know, cars represented a very real threat to America's horse and buggy industries. Would customs officials have blocked automobile manufacturing as well? The job of Homeland Security is not to pick which technology wins or to protect the business models of some legacy companies within an industry. And it's not actually a "threat." It's an opportunity for those who know how to embrace it. Remember, the movie industry continues to do quite well -- and it was the one who claimed that the DVD business would kill it. If this were a few decades back, would ICE be blocking all DVD imports because it represented a "a very real threat to America's film industry"? After all, that's exactly what the industry claimed, just as they are doing now. Why does Morton and ICE simply believe it this time when the industry has been wrong every single time about technology threats?
ICE has a legacy of engagement in IP theft enforcement -- stretching from our past years as U.S. Customs Service investigators to our present role as Homeland Security investigators. ICE is a leading agency in the investigation of criminal intellectual property violations involving the illegal production, smuggling, and distribution of counterfeit and pirated products, as well as money laundering violations.
Sure, the role is supposed to be about blocking counterfeit goods at the border. That's got nothing to do with file sharing online, so why dump it in there?
Representatives from the Motion Picture Association of America (MPAA) and RIAA assisted participating customs authorities with focused training, targeting and analysis...
Once again, we see biased industry players "training" government officials. Given the "training" we've seen both the MPAA and RIAA create for schools, why does it seem likely that they leave out certain important things (fair use, anyone?)?
ICE is an active member of the U.S. delegation negotiating the Anti-Counterfeiting Trade Agreement (ACTA). The goal of ACTA is to work with other countries interested in promoting strong enforcement of IPR. ACTA aims to strengthen legal frameworks to bridge existing gaps between laws and dedicated enforcement....
Someone's off message. Remember, ACTA isn't supposed to be about changing legal frameworks or laws.
Last month, the IPR Center launched Operation In Our Sites, a new initiative aimed at Internet counterfeiting and piracy.
Please. Be honest: it was aimed at piracy. It had nothing whatsoever to do with counterfeiting.
On June 30, more than 75 ICE agents participated in this enforcement action, which resulted in the seizure of assets from 15 bank, PayPal, investment, and advertising accounts.
And, um, also raising all sorts of legal questions about Homeland Security's right to just seize domains. On top of that, as many are starting to point out, just because you seize the domain name, it doesn't mean you take down the actual site. And, all this will really do is drive file sharers further underground.
Interestingly, as the new owners of the domain name, ICE has been able to determine the number of visitors these sites have received since seizures. Within two days of ICE's enforcement action against these pirating web sites, over 1.7 million visitors saw the banner. This number is more than the daily total of "hits" the sites were receiving when they offered pirated movies and music. In other words, the government's warning banners have "gone viral," and Internet users are actually seeking the web site out to view the banners themselves. The resulting public education about pirating is a significant result of this enforcement operation.
You might want to ask those visitors what they learned. Because many learned that Homeland Security is focused on stopping file sharing, rather than important things like stopping terrorism. People who are visiting those sites aren't suddenly saying "hey, wow, now I know it's illegal and I'll stop."
The IPR Center recognizes that law enforcement cannot fight IP theft alone and we look to partner with private industry in our efforts. In a market economy, no one has a greater incentive for protecting intellectual property rights than private industry. Companies want to protect their investments in research, development, manufacturing, sales, marketing and product distribution.
No. They want to protect their profits. They want to protect the monopoly rents guaranteed by the government. It's really quite scary how Homeland Security admits that it's protecting the business models of certain industries over those of other industries. This is not the role Homeland Security is supposed to be playing.
I have no problem with Homeland Security stopping legitimately harmful or faked products at the border. That makes perfect sense. But no one has explained what any of that has to do with seizing domains from file sharing sites. Conflating trademark infringement and copyright infringement, and acting as if they're the same thing, while highlighting the harm of fake drugs and then lumping in downloaded music and movies is extremely disingenuous. It's too bad our tax dollars are being used to prop up companies who refuse to adapt, and the lengths to which government employees will go to, in an effort to rationalize such blatant extension of their mandate in order to help out key companies.
