Category Archives: Government Oversight

IPEC Victoria Espinel Steps Down

Intellectual Property Enforcement Coordinator, Victoria Espinel, has stepped down from her position, effective Friday, August 9, 2013. Andrew Ramonas, “White House IP Chief Victoria Espinel Steps Down,” Corporate Counsel, Aug. 13, 2013. Until a new IPEC is officially named, Howard Shelanski, administrator of the U.S. Office of Information and Regulatory Affairs, will act as Interim IPEC. Id.

According to Corporate Counsel, “Congress created the intellectual property enforcement coordinator post in the Prioritizing Resources and Organization for Intellectual Property Act of 2008 (text), and the Senate confirmed Espinel as the coordinator in December 2009. She previously was an IP law professor at George Mason University School of Law and the first assistant U.S. trade representative for intellectual property and innovation.” Id. Continue reading

USPTO Extends Deadline for Voluntary Best Practices Study

The USPTO recently requested comment from the public on the topic of “processes, data metrics, and methodologies that could be used to assess the effectiveness of cooperative agreements and other voluntary initiatives to reduce intellectual property infringement that occurs on-line—such as copyright piracy and trademark counterfeiting.” See Prior Blog Post, White House Releases Second Joint Strategic Plan for IP Enforcement (June 20, 2013). The original deadline for comment was July 22, 2013.

On July 17, 2013, the USPTO extended the deadline until August 21, 2013.

Interested parties should respond to the current regulation (Fed. Reg. No. 2013-17166, see explanation in “Voluntary Best Practices Study; Extension of Comment Period“) and include the information itemized in the original request (Fed. Reg. No. 2013-37210).

Online Piracy and Counterfeiting: Ad Networks Adopt New “Best Practices Guidelines”

On July 15, 2013, the US Intellectual Property Enforcement Coordinator (IPEC), Victoria Espinel, announced the adoption of best practices for online advertising, with an aim to reduce the influx of counterfeiting or pirating conduct. The IPEC explained that these practices are aimed at “reducing the flow of ad revenue to operators of sites engaged in significant piracy and counterfeiting.” Victoria Espinel, “Coming Together to Combat Online Piracy and Counterfeiting,” Office of Management and Budget (July 15, 2013). The participants in this program – at least at the outset, are 24/7 Media, AOL, Conde Nast, Google, Microsoft, SpotXchange and Yahoo! Id.   While supporting and encouraging initiatives like this, the IPEC also cautioned that these activities be undertaken in the context of other interests in the Internet marketplace:

“It is critical that such efforts be undertaken in a manner that is consistent with all applicable laws and with the Administration’s broader Internet policy principles emphasizing privacy, free speech, fair process, and competition. We encourage the companies participating to continue to work with all interested stakeholders, including creators, rightholders, and public interest groups, to ensure that their practices are transparent and fully consistent with the democratic values that have helped the Internet to flourish. We also encourage other participants in the online advertising space to consider adopting voluntary initiatives that protect ad networks, publishers, advertisers, creators, rightholders, and above all, consumers.”

Id. The IPEC’s blog post includes links to the public statements made by AOL, Google, Microsoft and Yahoo! about these best practices. A copy of the best practices themselves can be found here.

Earlier Online Advertising Initiatives

In March 2012, the IPEC announced another best practices initiative: IPEC, “Advertisers and Advertising Agencies Address Online Infringement Through Best Practices,” Spotlight at 3 (Mar. 2012). Specifically, the American Association of Advertisers (“4As”) and the Association of National Advertisers (“ANA”) strongly encouraged their members to take affirmative steps to prevent U.S. advertisers from placing their ads on predatory foreign websites (“PFWs”) – those websites based outside U.S. borders that target U.S. consumers and offer predominantly counterfeit products or pirated content. Press Release, “ANA, 4As Release Statement of Best Practices Addressing Online Piracy and Counterfeiting” (undated); Member Bulletin, “Media Matters: Statement of Best Practices to Address Online Piracy and Counterfeiting,” (June 1, 2012).

These affirmative steps include, for example, insertion of language in ad placement contracts that requires ad networks and other intermediaries involved in U.S.-originated advertising campaigns to take commercially reasonable measures to prevent ads from appearing on PFWs.  Member Bulletin (June 1, 2012). Other steps include requiring intermediaries involved in the serving of an advertisement to respond expeditiously to complaints by rights holders or advertisers and to provide remediation to advertisers whose ads have been misplaced on PFWs. Id.

Conclusions

The problem of online counterfeiting and piracy undertaken by PFWs causes serious damage to the U.S. economy and U.S. businesses. See, e.g., StopFakes.com, “Top 10 Ways to Protect Yourself From Counterfeiting and Piracy” (undated). Every initiative aimed at reducing the impact of these activities is welcome, assuming that other rights (such as First Amendment, privacy, competition and fundamental due process) are not sacrificed. Hopefully, we will see more initiatives from other key players in the Internet ecosystem that are not only aimed at reducing online piracy and counterfeiting, but also at effectively eliminating the incentive for PFWs to capitalize on U.S. intellectual property rights. By eliminating the incentive, perhaps the “cost” to offer pirated content and counterfeited goods will simply be too high, and these entities will choose to no longer offer them.

White House Releases Second Joint Strategic Plan for IP Enforcement

Today, the IPEC (Intellectual Property Enforcement Coordinator) announced that the White House has released its second Strategic Plan for IP Enforcement. The IPEC’s blog provides more information about what is included in the update: http://www.whitehouse.gov/blog/2013/06/20/intellectual-property-key-driver-our-economy. Among the myriad updates in this report are the following:

  • Report on private sector “voluntary” agreements to combat counterfeiting and piracy:
    1) Center for Safe Internet Pharmacies (jointly established by American Express, Discover, eNom, Facebook, GoDaddy, Google, MasterCard, Microsoft, Neustar, PayPal, Visa and Yahoo!);
    2) Joint initiative by AT&T, Cablevision, Comcast, Time Warner Cable, and Verizon along with music labels and movie studios to voluntarily reduce online piracy;
    3) Creation of best practices by payment processors such as American Express, Discovery, MasterCard, PayPal and Visa to withdraw payment services for online sales of counterfeit and pirated goods; and
    4) The Association of National Advertisers’ and American Association of Advertising Agencies’ joint leadership pledge not to support online piracy and counterfeiting with advertising revenue (see MPAA’s report about the issuance of this pledge);
  • Of the 20 legislative recommendations made in the Administration’s March 2011 White Paper on Intellectual Property Enforcement Legislative Recommendations, seven of them have become law.

The Administration re-articulated its continuing concerns about the following areas: 1) abusive patent litigation tactics that pose “a significant and growing challenge to innovation” and is seeking introduction and passage of various patent reform recommendations; 2) efforts by foreign governments to require the transfer of trade secrets or other proprietary business information as a condition of market access or the ability to do business in that country; and 3) changes in technology, social norms, business models and global distribution models that further complicate IP enforcement concerns (such as cloud computing, mobile computing, data storage, information security and 3D printing). It reports having made strides already to address these concerns, but recognizes that more work remains to be done.

The USPTO simultaneously issued a request for public comment about Voluntary Best Practices to curb online counterfeiting and piracy. A summary of the Notice and its components can be found here: http://www.regulations.gov/#!documentDetail;D=PTO-C-2013-0036-0001; the actual Federal Register Notice is here: http://www.regulations.gov/contentStreamer?objectId=09000064813341ca&disposition=attachment&contentType=pdf. According to the Notice, comments must be submitted by July 22, 2013.

The first Strategic Plan was announced in 2010. Prior Privacy and IP Law Blog posts about the IPEC and other IP enforcement initiatives/updates can be found here: IPEC.

Congressional Joint Economic Committee Published Report on Impacts of IP Theft

On August 6, 2012, the Joint Economic Committee issued its report on “The Impact of Intellectual Property Theft on the Economy.” (Press release; report). In summary, the report explains:

“IP infringement harms companies through lost revenue, the costs of IP protection, damage to brand, and decreased incentives to innovate because of potential theft.[FN3] Consumers are harmed when they purchase counterfeit goods of lower quality, some of which, such as counterfeit medicines, may pose health or safety risks. Governments lose tax revenue and bear enforcement costs. Decreased incentives to innovate resulting from IP infringement reduce economic growth, weaken the nation’s competitiveness, and decrease job creation.” (Report at 1)

Each of these items of harm are detailed in the report, which cites statistics about seizures by various government agencies, both U.S. and abroad. In addition, it singles out China as a major source of “pirated goods seized at the U.S. border.” (Id.)

The report also posits that small businesses are less likely to be able to combat such infringement, or actively enforce their IP rights, because they lack the resources to pursue enforcement actions.  The report explains that this conclusion derives directly from statistics about filing habits in judicial fora:  “Data on investigations initiated and completed by the U.S. ITC [International Trade Commission] show that while small businesses represent 79.0 percent of all businesses in the U.S., they comprise only 10.5% of firms filing complaints regarding intellectual property infringement.” (Id. at 3) (footnote omitted). Indeed, 78.9% of the firms that seek to enforce their rights through this mechanism are apparently large or public firms. (Id.)

Finally, the report concludes that the Intellectual Property Enforcement Coordinator (IPEC) is preparing a new Joint Strategic Plan on Intellectual Property Enforcement, which presents an opportunity to improve protections for U.S. IP rights holders. (The IPEC’s June 2012 Report on the Joint Strategic Plan (2 Year Anniversary Report) is the most current version available online.)