[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]


                       DIGITAL COPYRIGHT PIRACY:
                 PROTECTING AMERICAN CONSUMERS, WORKERS, 
                               AND CREATORS

=======================================================================

                                HEARING

                               BEFORE THE

                  SUBCOMMITTEE ON COURTS, INTELLECTUAL 
                        PROPERTY, AND THE INTERNET

                                 OF THE

                       COMMITTEE ON THE JUDICIARY

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                      WEDNESDAY, DECEMBER 13, 2023

                               __________

                           Serial No. 118-57

                               __________

         Printed for the use of the Committee on the Judiciary
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]         


               Available via: http://judiciary.house.gov
               
                               __________

                   U.S. GOVERNMENT PUBLISHING OFFICE                    
54-399                      WASHINGTON : 2024                    
          
-----------------------------------------------------------------------------------     
              
                       COMMITTEE ON THE JUDICIARY

                        JIM JORDAN, Ohio, Chair

DARRELL ISSA, California             JERROLD NADLER, New York, Ranking 
KEN BUCK, Colorado                       Member
MATT GAETZ, Florida                  ZOE LOFGREN, California
ANDY BIGGS, Arizona                  SHEILA JACKSON LEE, Texas
TOM McCLINTOCK, California           STEVE COHEN, Tennessee
TOM TIFFANY, Wisconsin               HENRY C. ``HANK'' JOHNSON, Jr., 
THOMAS MASSIE, Kentucky                  Georgia
CHIP ROY, Texas                      ADAM SCHIFF, California
DAN BISHOP, North Carolina           ERIC SWALWELL, California
VICTORIA SPARTZ, Indiana             TED LIEU, California
SCOTT FITZGERALD, Wisconsin          PRAMILA JAYAPAL, Washington
CLIFF BENTZ, Oregon                  J. LUIS CORREA, California
BEN CLINE, Virginia                  MARY GAY SCANLON, Pennsylvania
LANCE GOODEN, Texas                  JOE NEGUSE, Colorado
JEFF VAN DREW, New Jersey            LUCY McBATH, Georgia
TROY NEHLS, Texas                    MADELEINE DEAN, Pennsylvania
BARRY MOORE, Alabama                 VERONICA ESCOBAR, Texas
KEVIN KILEY, California              DEBORAH ROSS, North Carolina
HARRIET HAGEMAN, Wyoming             CORI BUSH, Missouri
NATHANIEL MORAN, Texas               GLENN IVEY, Maryland
LAUREL LEE, Florida                  BECCA BALINT, Vermont
WESLEY HUNT, Texas
RUSSELL FRY, South Carolina
Vacant

                                 ------                                

           SUBCOMMITTEE ON COURTS, INTELLECTUAL PROPERTY, AND
                              THE INTERNET

                    DARRELL ISSA, California, Chair

THOMAS MASSIE, Kentucky              HENRY C. ``HANK'' JOHNSON, Jr., 
SCOTT FITZGERALD, Wisconsin              Georgia, Ranking Member
CLIFF BENTZ, Oregon                  TED LIEU, California
BEN CLINE, Virginia                  JOE NEGUSE, Colorado
LANCE GOODEN, Texas                  DEBORAH ROSS, North Carolina
KEVIN KILEY, California              ADAM SCHIFF, California
NATHANIEL MORAN, Texas               ZOE LOFGREN, California
LAUREL LEE, Florida                  MADELEINE DEAN, Pennsylvania
RUSSELL FRY, South Carolina          GLENN IVEY, Maryland

               CHRISTOPHER HIXON, Majority Staff Director
          AMY RUTKIN, Minority Staff Director & Chief of Staff
                            
                            
                            C O N T E N T S

                              ----------                              

                      Wednesday, December 13, 2023

                                                                   Page

                           OPENING STATEMENTS

The Honorable Darrell Issa, Chair of the Subcommittee on Courts, 
  Intellectual Property, and the Internet from the State of 
  California.....................................................     1
The Honorable Henry C. ``Hank'' Johnson, Ranking Member of the 
  Subcommittee on Courts, Intellectual Property, and the Internet 
  from the State of Georgia......................................     2

                               WITNESSES

Richard Gladstein, Academy Award nominated producer; President/
  Founder, FilmColony; Executive Director, Brooklyn College 
  Feirstein Graduate School of Cinema
  Oral Testimony.................................................     4
  Prepared Testimony.............................................     7
Riche T. McKnight, General Counsel, Ultimate Fighting 
  Championship; Executive Vice President, Deputy General Counsel, 
  Co-Head, Litigation, Endeavor
  Oral Testimony.................................................    10
  Prepared Testimony.............................................    12
Matthew Schruers, President, Computer & Communications Industry 
  Association; Co-Founder/Board Chair, Digital Trust & Safety 
  Partnership
  Oral Testimony.................................................    21
  Prepared Testimony.............................................    23
Karyn A. Temple, Senior Executive Vice President, Global General 
  Counsel, Motion Picture Association; Former Register of 
  Copyrights and Director, U.S. Copyright Office
  Oral Testimony.................................................    32
  Prepared Testimony.............................................    34

          LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING

All materials submitted by the Subcommittee on Courts, 
  Intellectual Property, and the Internet, for the record........    68

Statement from the Association of American Publishers, Dec. 13, 
  2023, submitted by the Honorable Ben Cline, a Member of the 
  Subcommittee on Courts, Intellectual Property, and the Internet 
  from the State of Virginia, for the record

                 QUESTIONS AND RESPONSES FOR THE RECORD

Questions submitted by the Honorable Darrell Issa, Chair of the 
  Subcommittee on Courts, Intellectual Property, and the Internet 
  from the State of California, for the record
  Questions for Karyn A. Temple, Senior Executive Vice President, 
      Global General Counsel, Motion Picture Association, Former 
      Register of Copyrights and Director, U.S. Copyright Office
  Questions for Matthew Schruers, President, Computer & 
      Communications Industry Association, Co-Founder and Board 
      Chair, Digital Trust & Safety Partnership
A response from Karyn A. Temple, Senior Executive Vice President, 
  Global General Counsel, Motion Picture Association, Former 
  Register of Copyrights and Director, U.S. Copyright Office, for 
  the record
A response from Matthew Schruers, President, Computer & 
  Communications Industry Association, Co-Founder and Board 
  Chair, Digital Trust & Safety Partnership, for the record

 
                       DIGITAL COPYRIGHT PIRACY:
          PROTECTING AMERICAN CONSUMERS, WORKERS, AND CREATORS

                              ----------                              


                      Wednesday, December 13, 2023

                        House of Representatives

           Subcommittee on Courts, Intellectual Property, and

                              the Internet

                       Committee on the Judiciary

                             Washington, DC

    The Committee met, pursuant to notice, at 10:03 a.m., in 
Room 2141, Rayburn House Office Building, the Hon. Darrell Issa 
[Chair of the Subcommittee] presiding.
    Members present: Representatives Issa, Fitzgerald, Bentz, 
Cline, Kiley, Lee, Johnson, Nadler, Lieu, Ross, Lofgren, and 
Ivey.
    Mr. Issa. The Subcommittee will come to order. Without 
objection, the Chair is authorized to declare a recess at any 
time.
    Today we would like to welcome this hearing on digital 
copyright privacy. I will now recognize myself for a short 
opening statement.
    Today we are exploring the topic of copyright privacy in a 
digital era. This is not a new subject. The Digital Millennium 
Copyright Act is more than 20 years old. Yet, emerging 
technologies and emerging threat have, in fact, caused us to 
once again have to revisit the threat to this great industry.
    In 2019, the industries involved in copyright employed 
nearly nine million people, contributed at least $1.3 trillion 
to the U.S. economy. Of these numbers, online piracy is 
estimated to cost over 200,000 jobs and approximately $50 
billion to our gross domestic product. You might ask, well, if 
they are in commerce why it is not in our GDP, because for the 
most part it goes to foreign countries, and it goes to 
individuals who will never pay their taxes.
    While copyright piracy used to be involved in back-alley 
sales of ripped CDs, DVDs, or in my day the bootleg 8-track, 
digital copyright piracy now involves amounts of infringing 
content made widely available on the internet. Much of it is 
given away for free, but not without a cost. The cost often 
includes the spyware and, in fact, side advertising that pays 
for giving away your rights free.
    Unfortunately, many of these websites, like FMovies, are 
hosted on servers that exist outside the United States, 
currently outside our ability to take them down. This creates 
unique judicial challenges for enforcement against widespread 
privacy on such websites. In some cases, these websites are 
even hosted within foreign governments, governments like the 
Russian government on military bases and other enemies of the 
United States.
    It is vital to understand the important difference between 
websites that happen to have infringing activities, websites 
that may host those who, in fact, do not respect intellectual 
property, and criminal websites who exist only for the purpose 
of, in fact, giving away that which they did not buy and have 
no rights to.
    In this hearing, we want to explore possible solutions to 
the worst of the worst, at least a way to minimize the 
prevalence of this infringing content on these illegal sites. 
These solutions could include requiring internet service 
providers to permanently block piracy sites that host only or 
substantially only infringing content. This is a very small 
portion of all ISPs but a large portion of that which is stolen 
on behalf of these individuals. Dynamic site blocking to 
address privacy of live sports and entertainment for set 
periods time may also be explored, working with platforms to 
remove pirated content as soon as possible to better meet the 
needs of live sports entertainment.
    I want to particularly focus on that here today. I look 
forward to the witnesses, because, in fact, notice and takedown 
might be fine in a week, a day, or an hour, unless, in fact, 
the event is only an hour or two along and one or two hours 
means there is no effective takedown in the live broadcast.
    Given the importance of this issue, I want to thank our 
witnesses for appearing here today. I want to say it once and 
for all. This Committee is the Committee of jurisdiction. 
Inaction is not acceptable. We have to find solutions that work 
for the intellectual property producers or we will not have the 
robust industry in the future that we have today.
    With that, I would like to recognize the Ranking Member for 
his opening statement.
    Mr. Johnson of Georgia. Thank you, Chair Issa. Thank you 
for holding this very important hearing.
    When the Barbie movie premiered earlier this year, it made 
$155 million its first three days in U.S. theaters. 
Internationally, it earned $359 million that first box office 
weekend. Barbie ultimately brought an estimated nine million 
new moviegoers to theaters according to a prescreening survey 
done by the Quorum.
    Industries like the film industry, ones that are reliant on 
the exclusive authority to reproduce and distribute creative 
derivative versions and--excuse me. Industries like the film 
industry, ones that are reliant on the exclusive authority to 
reproduce and distribute, create derivative versions, and 
publicly perform a copyrighted work contributed $1.29 trillion 
to the U.S. GDP in 2019. As the viewing public, we often hear 
the most about those top line numbers. That is because box 
office scores and tales of sold-out theaters make the news, but 
they are only a part of the story.
    Of those in this room who joined the crowds to see Barbie 
in theaters, I bet few, if any of us, sat through and watched 
as the credits rolled. If we had, we would have read the names 
of just a few of the myriad individuals required to make a 
movie. Yes, the film studios are the primary rightsholders of 
the copyrighted work, and the actors and directors get most of 
the world's attention. There are so many more people whose 
livelihoods depend on the success of a film. Technicians, 
writers, musicians, carpenters, engineers, artists, 
programmers, and so many more add up to constitute the film 
industry. The U.S. film and TV industries support and are 
supported by millions of individuals employed by those sectors.
    In 2019, copyright intensive industries in the United 
States employed 6.6 million individuals directly and two 
million more people through indirect employment. I say this all 
not to diminish the importance of box office success, far from 
it. It is important for us to remember that copyright law does 
not just support the bottom line, but also the small creators 
and industry workers. Copyright law itself may have little to 
do with driving a truck or feeding hungry studio workers. These 
are some of the people hurt by piracy of copyrighted works.
    Digital piracy of film and television has increased since 
2020. Between January-August 2022, there were 141.7 billion 
visits to copyright piracy sites worldwide. Piracy has caused 
an estimated annual loss of between 230,000 and 560,000 jobs in 
the United States and between $47.5 and $115.3 billion in 
reduced GDP. These are staggering losses to our creative 
fields. They impact not just the stars and studio executives 
but the many individuals who work in the industry. When 
industries cannot afford to pay competitive salaries, students 
look to different fields.
    Piracy of copyrighted works is not a new problem. What 
began as pirated DVDs back in the 1990s became a torrent of 
files in the 2000s. Torrent files have now become streaming. 
Today more than 80 percent of digital video piracy is conducted 
via streaming where copies of movies, television, and other 
copyrighted content are available in real time over the 
internet.
    Congress has acted to protect copyright dependent 
industries before. From the moment personal computers landed in 
homes around the world, we knew content piracy would be a 
concern. That is why Congress passed Section 512 of the Digital 
Millennium Copyright Act in 1998 to provide the opportunity to 
protect copyrighted works on the internet.
    I am looking forward to hearing from our witnesses how 
notice and takedown works today, what challenges exist in 
removing pirated content, and how changes in technology and the 
internet itself have impacted how we think about copyright 
protections overall.
    I would also note that I know the stakeholders are not 
limited to the people in this room. When Congress sets about to 
solve or even examine an issue, we need to look at all the 
facts and hear from everyone. We must approach any issue before 
this Committee with the seriousness and diligence it deserves. 
I am certain that my Chair will do that. This hearing is, 
however, an important first step to examining the problem of 
copyright piracy.
    Finally, welcome to our witnesses. I look forward to 
hearing from you today and appreciate your willingness to 
testify before us. I thank the Chair once again. I yield back 
the balance of--
    Mr. Issa. I thank the Ranking Member. Without objection, 
all other opening statements will be included in the record. It 
is now my pleasure to introduce our witnesses.
    Mr. Richard Gladstein is an Academy Award nominated 
producer and Executive Director of Brooklyn College Graduate 
School of Cinema and President and Founder of the motion 
picture production company, FilmColony. He has produced or 
executive produced films such as The Hateful Eight, Pulp 
Fiction, the one that all us know of, The Cider House Rules, 
Finding Neverland, among others. Welcome.
    Mr. Riche McKnight is General Counsel of the Ultimate 
Fighting Championship or UFC, an Executive Vice President, 
Deputy General Counsel, and Co-Head of Litigation for Endeavor. 
In addition to being UFC's parent company, Endeavor owns and 
operates a number of other businesses spanning sports, 
entertainment, advertising, and talent representation.
    Mr. Matthew Schruers. Mr. Schruers is the President of the 
Computer and Communications Industry Association where he leads 
its advocacy on behalf of the internet, communications, and 
technology companies. He is also Co-Founder and Board Chair of 
the Digital Trust and Safety Partnership, which develops best 
practices to foster a safer and more trustworthy internet.
    A returning champion, to use the UFC terminology, Ms. Karyn 
Temple. Ms. Karyn Temple is now the Senior Executive Vice 
President and Global General Counsel of the Motion Picture 
Association where she oversees the Association's legal affairs, 
content protection efforts around the world. We knew her in her 
previous roles as the U.S. Copyright Office, most recently 
Register of Copyrights. Prior to leading the U.S. Copyright 
Office, Ms. Temple headed the Office of Policy and 
International Affairs.
    I want to take just one more moment. All of you are 
distinguished. To have somebody who has looked at clouds from 
both sides now, so to speak, having been so key to determining 
copyright and how it is to be inherently protected by 
government and now seeing in one of the most fiercely 
competitive areas, the stealing of copyright, is a real honor. 
I want to thank you for all your service in both roles.
    With that, I have to swear you in. Then we can begin. If 
you would, please rise to take the oath.
    Raising your right hand, do you solemnly swear or affirm 
under penalty of perjury that the testimony you are about to 
give will be the truth and correct to the best of your 
knowledge, information, and belief so help you God?
    Let the record reflect that all witnesses answered in the 
affirmative. Please be seated.
    We will now begin with Mr. Gladstein.

                 STATEMENT OF RICHARD GLADSTEIN

    Mr. Gladstein. Chair Issa, Ranking Member Johnson, and the 
distinguished Members of the IP Subcommittee, thank you for 
your invitation to speak with you today on behalf of America's 
creative community.
    As the Chair said, I am a filmmaker and educator. I 
produced such films as The Bourne Identity, Finding Neverland, 
She's All That, The Cider House Rules, Pulp Fiction, among many 
others. I am currently the Executive Director at Brooklyn 
College's Feirstein Graduate School of Cinema, a part of the 
City University of New York, where we are educating the next 
generation of diverse storytellers.
    Film and television production benefits a great many of our 
cities and States. On average, for each and every day a film 
shoots, approximately $250,000 is contributed to that local 
economy. Small films generally shoot for about 24 days and 
large ones for over 70 days. Throughout the U.S., our film and 
television industries employ approximately 2.4 million 
Americans. These numbers bear out what I have always known in 
my heart to be true. Creativity is not just an important part 
of American life. It is the backbone of our Nation's cultural 
and economic strength.
    Despite being a robust engine for the U.S. economy, our 
industries have been besieged by digital piracy since the 
inception of the internet. We have been fighting these illegal 
activities with our hands tied behind our backs ever since.
    I am not here today to speak about issues concerning fair 
use or the use of clips from films or television shows or the 
ways in which ideas or content are used by others in similar 
works. Rather, I am going to confine my thoughts to the 
wholesale theft and distribution of our movies and TV shows by 
criminal enterprises, not facsimile or parts or replicas of our 
work, but rather the entire and actual film or television 
program.
    Large scale piracy operations today are criminal 
enterprises. They create internet sites that look deceptively 
similar to legitimate streaming services. A recent study found 
that as many as 30 million Americans use these illegal 
streaming services often without realizing they are doing so. 
The damages are significant, as another report found that 
piracy causes losses of at least $29 billion and as much as $71 
billion each and every year.
    It has also been proven that digital piracy costs the U.S. 
economy between 230,000 and 560,000 jobs every year. The vast 
majority of these job losses and revenues affect the workers 
behind the cameras, the production designers, costume 
designers, cinematogra-phers, caterers, and every member of 
their crews, including seamstresses, carpenters, electricians, 
and more. These are well paid, skilled jobs for crafts people. 
They often do not require a four-year college degree.
    Many look at us as large corporations. These individuals, 
again the backbone of our industry, are mostly freelance and a 
part of the gig economy. Ninety-two percent of the businesses 
in film and television employ fewer than ten people. Our 
workers' pension and health plans are funded by residuals. 
These residuals are derived from revenue and profits from 
movies and television shows. Piracy is eviscerating these 
profits.
    So, why are we allowing hundreds of thousands of American 
jobs to disappear each year? The truth is that most of the 
piracy happening in the United States is occurring through 
illegal services that are based overseas and beyond the reach 
of U.S. law enforcement. Although there are laws in place 
around the world that are proven to be effective against 
piracy, these tools are not yet available to us here in the 
United States.
    One such effective tool allows courts to issue no-fault 
injunctive relief or site blocking, creating orders that direct 
internet service providers after a full judicial process to 
block access to offshore websites that are found to be 
dedicated to piracy. This tool is effective in more than 40 
countries that have implemented it, including in Western 
democracies like Canada, the U.K., and Australia.
    There is a decade of evidence to support its effectiveness. 
Numerous studies have shown that this tool reduces traffic to 
pirate sites while also increasing traffic to legitimate and 
legal sites, the sites that actually result in fair 
compensation to creatives for their work. Early objections to 
site blocking erroneously said it would be abused, could cause 
harm to free speech, or break the internet. Creatives like me 
are fierce advocates for free speech, and we would never call 
for this important right to be blocked. When piracy is 
diminished with effective laws, film financiers and creatives 
will be able to realize the revenue they are entitled to.
    As my time is running out, I will say that, in sum, I am 
here to request that Congress find reasonable solutions, such 
as site blocking, to curtail the theft and distribution of our 
creative work. Those engaged in illegal behavior, as well as 
internet intermediaries, that consistently aid and abet such 
theft should be stopped and face penalties. Thank you for your 
invitation to speak with you and your consideration of my 
testimony.
    [The prepared statement of Mr. Gladstein follows:]
    [[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Issa. I thank the gentleman. We now go to Mr. McKnight.

                 STATEMENT OF RICHE T. McKNIGHT

    Mr. McKnight. Chair Issa, Ranking Member Johnson, 
distinguished Members of the Subcommittee, thank you for 
inviting me to testify today.
    My name is Riche McKnight. I am Executive Vice President 
and General Counsel of the Ultimate Fighting Championship and 
Deputy General Counsel and Co-Head of Litigation at Endeavor, 
one of the world's largest sports, entertainment, and fashion 
companies. I am honored to testified about the internet piracy 
challenges that UFC faces as a provider of popular live sports 
content. UFC appreciates working with Congress on this issue, 
including the enactment of the Protecting Lawful Streaming Act 
in 2020.
    UFC is a preeminent content creator that hosts and airs 
live mixed martial arts content, including through a pay-per-
view option in the United States in partnership with ESPN+. UFC 
events are beloved and highly anticipated.
    As explained in my written statement, a critical element of 
UFC's content is that the essence of the event often involves 
highly impactful but very brief moments in time, such as a 
knockout in a fight or a well-executed move. These key moments 
frequently last only minutes or even seconds.
    Because UFC's content is so popular, UFC faces pervasive 
piracy of its live content. Pirates record the live streams not 
just through holding their phones up to a screen to record a 
UFC event and livestream it, but also through more 
sophisticated techniques resulting in HD quality video. The 
pirates also brazenly advertise on social media platforms to 
get viewers to come to their pirate websites with slogans like 
Watch UFC Free. When people learn that they will be able to 
access UFC content for free, they have no reason to purchase 
UFC content via pay-per-view.
    The problem is not unique to UFC. UFC recently submitted a 
joint letter with the NBA and the NFL to the U.S. Patent and 
Trademark Office that highlighted the challenges we all face 
with respect to the piracy of live sports events. By one 
estimate, the financial impact of online piracy across the 
global sports industry is up to $28 billion in additional 
potential annual revenue. UFC estimates that online piracy 
diverts multiple millions of dollars from legitimate purchases 
of UFC's content each year. In turn, this results in a 
substantial loss of tax revenue and harms sports providers' 
ability to host events that benefit local businesses and 
communities.
    UFC does the hard work to submit thousands of takedown 
requests to a variety of online service providers during and 
immediately after each UFC event. It has also engaged in 
outreach to individual platforms. However, despite these 
efforts, piracy persists. You have heard from and will continue 
to hear from my co-panelists about site blocking. UFC supports 
those efforts for the reasons that have already been discussed.
    UFC has also identified a few additional solutions that I 
will talk about today and that would significantly help address 
the problem of piracy of live sporting events. First and 
foremost, OSPs do not remove infringing livestreams and videos 
expeditiously, as is required for them to attain a safe harbor 
from liability for the infringement of their users under the 
Digital Millennium Copyright Act. In fact, infringing 
livestreams often stay online for a full UFC event. UFC has 
found the OSPs exploit a lack of clarity in DMCA as to what it 
means to remove content expeditiously, which clearly must 
account for whether the request is time sensitive.
    To put matters concretely, for each UFC pay-per-view event 
between January of last year and this past November, UFC sent 
thousands of takedown requests on average, even putting aside 
infringing content that was automatically removed by certain 
OSPs. For livestream content, 26 percent of infringing UFC 
content was permitted to stay up for longer than one hour after 
requests, a significant portion of a live event. Approximately 
six percent of content was permitted to stay up for longer than 
five hours. It is not uncommon for these streams to collect 
hundreds of thousands or even millions of views while they are 
available.
    Congress can and should clarify that at least for time-
sensitive content like live sporting events expeditious removal 
means that infringing content must be removed instantaneously 
or near instantaneously. It is not enough if an infringing 
livestream is left up until the live content ends.
    Second, many OSPs have not adopted an effective process for 
identifying and terminating repeat infringers, as is also 
required for them to have a safe harbor under the DMCA. Too 
frequently, UFC sees that after a user is terminated for repeat 
infringement, that same user will create new accounts that are 
obviously connected to the previous account. Clarification is 
needed that a reasonable repeat infringer policy would among 
other things involve account verification measures that prevent 
the creation of new accounts by the same person and other 
measures that would limit the ability of newly created accounts 
to live stream for a certain period or reach a widespread 
audience of viewers.
    We recognize this continues to be an ongoing conversation 
requiring input from all stakeholders. We hope to be able to 
work with you and the Members of this Subcommittee going 
forward. I want to thank the Subcommittee again for giving UFC 
the opportunity to testify today. I would be happy to answer 
any questions you may have. Thank you.
    [The prepared statement of Mr. McKnight follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Issa. Thank you. Mr. Schruers.

                 STATEMENT OF MATTHEW SCHRUERS

    Mr. Schruers. Chair Issa, Ranking Members Johnson, and the 
Members of the Subcommittee, thanks for the invitation. It is 
good to be with you again today. My name is Matt Schruers. I'm 
President of CCIA.
    For over 50 years, CCIA has been a voice for information, 
communications, and technology firms. Products provided by our 
members connect and empower users around the world, enabling 
work and study in commerce and entertainment for billions. In 
so doing, the digital sector is a proud and critical partner to 
the creative industry. Widespread adoption of technology 
products and services have created entirely new markets for the 
legal consumption of content, permitting users to lawfully 
enjoy digital media nearly anywhere at any time, generating 
more revenue opportunities for creators than have ever existed 
before.
    Tech companies are themselves IP creators, spending 
hundreds of millions of dollars on premium, award-winning 
content and millions more licensing content from others for 
lawful distribution. As leading providers of content and 
licensees, they understand well the value of that investment.
    It is the case that a small minority of bad actors' misuse 
digital tools to infringe IP rights. The digital sector shares 
the goal of preventing this. We must achieve this goal without 
interfering with legitimate online commerce, communication, and 
the Constitution. The most powerful tool to prevent 
infringement is ensuring that consumers can lawfully access the 
content they want, where they want it, when they want it on the 
device want it. Products provided by American tech leaders are 
making this possible.
    Now, in addition, CCIA members regularly engage with 
rights-
holders to identify and enforce against infringers, including 
through extensive content moderation systems that go above and 
beyond the notice and takedown that is currently contemplated 
by Federal law. Now, automated filtering is not always 
effective. It relies on third-party input, granular 
information. It can be misused. It can result in over-removal 
and over-enforcement against noninfringing content and fair 
use, thus suppressing lawful expression. So, automated systems 
do require human oversight and pairing the right solution with 
the problem to ensure they function properly.
    Policymakers should be wary of the proposal for online 
enforcement that is DNS level site blocking. This approach 
involves interfering with the basic architecture of the 
internet to suppress content. This blunt instrument of 
architectural regulation is inherently imprecise. It cannot be 
achieved file by file or even country by country, but instead 
disappears entire sites for the entire world. This puts far 
more speech at risk of suppression, similar to closing the 
Library of Congress over a single book. So, for that reason, 
DNS level site blocking is not technically or constitutionally 
possible to implement and certainly not without significant 
collateral damage.
    My written testimony describes in greater detail the EU's 
website blocking system, which is littered with false 
positives. It provides an instructive example of the unintended 
consequences of policy. There is little transparency around 
blocking orders and few ways to determine when content is being 
withheld from the public by court order. This is why 
technological experts like ICANN and the Internet Society have 
strongly advised against DNS level blocking.
    Now, election season is on us. It is prudent to recall that 
political speech is frequently a target of wrongful copyright 
allegations. In the last Presidential election, multiple 
candidates were prevented from livestreaming their own speeches 
due to dubious copyright claims. Campaign advertisements are 
regularly accused of infringement. Whether inadvertent or 
intentional, this cannot be tolerated in a democracy.
    So, in conclusion, the more blunt the instrument, the 
greater the risk to expression. So, we must calibrate solutions 
appropriately. Nevertheless, CCIA members are committed to 
fighting infringement by investing significant resources in new 
products that give new opportunities to creators and create 
better responses to infringement.
    I look forward to your questions. Thank you.
    [The prepared statement of Mr. Schruers follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Issa. Thank you. Ms. Temple.

                   STATEMENT OF KARYN TEMPLE

    Ms. Temple. Thank you, Chair Issa, Ranking Member Johnson, 
and the Members of the Subcommittee, for the opportunity to 
testify today on behalf of the motion picture, television, and 
streaming industries. Thank you for the very kind introduction 
at the beginning.
    The American motion picture and television production 
industry is the world leader in this sector, distributing its 
films and TV shows in over 130 countries. In 2021, the enduring 
value and global appeal of the U.S. movie industry earned $14.4 
billion in exports. Our industry is also a major U.S. employer 
that supported 2.4 million jobs and $186 billion in total wages 
in 2021.
    The topic of today's hearing is an issue of critical 
importance to our industry and to the many other industries 
that are part of the creative sector, piracy of valuable 
intellectual property.
    Piracy, of course, is not a victimless crime as you have 
heard. Piracy of filmed entertainment costs the U.S. economy 
$29.2 billion in over 230,000 jobs annually. It does not just 
affect big Hollywood studios and megastars. It affects everyone 
who works in the industry, such as carpenters, electricians, 
and hair stylists, as well as the businesses, as you heard most 
of them small businesses, that provide related services, like 
caterers, dry cleaners, and florists.
    In addition, piracy services can directly threaten 
Americans' personal and financial security, including exposing 
everyday people to credit card fraud, identity theft, and 
malware. Take FMovies, for example. It is a piracy website that 
has been blocked in 16 countries and was referred to U.S. law 
enforcement more than four years ago in 2019. It is still up 
and accessible to millions of users in the United States.
    If you would, please turn your attention to the screens. 
Anyone can simply type the FMovies' URL into their favorite 
browser today and an extremely professional and legitimate 
looking site pops up. You can literally scroll through 
thousands of movies and television shows, including this year's 
blockbusters, and even movies that have not yet hit theaters. 
You will see all our top-rated blockbusters and popular films.
    Here you see coming up Wonka, which won't be out into the 
United States' theaters until this Friday. It is just a click 
away on this piracy streaming service. Also, notice the ads for 
slotlights.net. That is an illegal online casino, likely 
Russian, that is targeting U.S. consumers. Analysis shows that 
this single piracy site had 168 million visits in just the 
month of November. Most of these visits come from the United 
States, accounting for roughly 38 percent of all users. This 
means that this site was visited more than 64 million times by 
people in the United States in just one month.
    As you clearly saw from this video, this is not a 
legitimate site that might include grandma's home movies or 
public domain documentaries. This is a commercial-scale 
operation whose sole purpose is to steal creative content and 
funnel the proceeds back to criminal organizations. If we had 
site blocking in the United States, as we do in the 16 other 
countries where versions of this site had been blocked already, 
then this piracy site's U.S. traffic would have plummeted, 
protecting U.S. consumers and the U.S. creative sector, and 
removing the financial incentives for piracy.
    So, it is beyond time for Congress to revisit no-fault 
injunctive relief to combat blatant forms of piracy. When 
Congress a decade ago considered establishing an express 
authority for such relief, opponents responded with the 
unfounded prediction of potential harm to the internet. As a 
result, Congress declined to move forward with legislation.
    Much of the world enacted these tools despite the 
overheated rhetoric. More than 40 countries, including leading 
democracies, such as the U.K., much of Western Europe, Canada, 
Australia, India, and South Korea, have enacted no-fault 
injunctive relief regimes that expressly authorize courts or 
administrative agencies to issue orders to ISPs to block access 
to websites dedicated to piracy. These laws work. They 
dramatically reduce visits to piracy sites. Even more 
important, they result in more visits to legal sites.
    None of the hyperbolic predictions about the effects of 
site blocking have come true. Examples of over-blocking, that 
is blocking of noninfringing content, or stifling free 
expression or deprivation of due process have been rare to the 
point of nonexistence. In fact, none of the examples of 
purported over-blocking that CCIA cited in its testimony 
actually involved a blocking order to an ISP because of 
copyright infringement.
    So, I am here today with some very good news. Effective 
tools to combat piracy exist. The sky has not fallen. Despite 
the widespread use of site blocking around the world, the 
internet is emphatically not broken. Thus, it is time for 
Congress to consider enacting express authority for a no-fault 
injunctive regime that will give rightsholders what more than a 
decade of experience around the globe has shown is one of the 
most effective tools to address piracy.
    Thank you for your time and attention to this important 
issue. I am happy to answer your questions.
    [The prepared statement of Ms. Temple follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Issa. Thank you. I am going to forego my initial round 
of questions and first go to the gentlelady from Florida, Ms. 
Lee.
    Ms. Lee. Thank you, Mr. Chair. Thank you to all our 
witnesses for being here today and sharing with us your 
insights and your expertise.
    Mr. Gladstein, I would like to begin with you. During your 
testimony, you described one remedy that you propose, which is 
site blocking. That is directing ISPs to block local access to 
websites that are dedicated to privacy. You also mentioned that 
you personally have a strong commitment to the First Amendment 
and protecting free speech. If you would please, elaborate for 
us on your perspective that site blocking does not infringe on 
First Amendment rights to speech and expression.
    Mr. Gladstein. Thank you for your question. You just were 
shown a website that is dedicated virtually entirely to 
distributing illegal programming that they don't own the rights 
to be disseminate. Blocking that site from doing what they are 
doing, the concept that this would be an infringement on free 
speech is I think a specious argument.
    If someone were to go and take a bunch of Ford F-150s and 
steal them and create a lot and judicial process went in and 
showed that. You looked at the VIN numbers, and you saw that 
they didn't have the right to sell. So, the person that set up 
this shop to sell these cars didn't have the right to do it. 
You went through a judicial review. You wanted to stop that 
store from selling illegal merchandise. The concept of saying 
that free speech would be infringed by blocking their 
advertising to sell free merchandise I think is specious, 
irrelevant, and it just makes no sense to me whatsoever.
    Ms. Lee. Tell us if you would, why and the what are the 
alternative remedies of the takedown? If the site is 
identified, having it shut down, why is that different and 
inadequate instead of the all-out site blocking?
    Mr. Gladstein. Well, I believe, I am not an expert at this, 
and Karyn would be better probably to answer, but the laws in 
which what we are able to do with companies that U.S. companies 
versus companies that are international companies is different. 
I think Karyn--
    Ms. Lee. We will give that to Ms. Temple. If you would, 
share with us a little bit more about your concepts of 
remedies, no-fault injunctive relief, and the distinction 
there.
    Ms. Temple. Yes, as he mentioned, the issue that we have 
been focusing on with respect to no-fault injunctive relief are 
those websites that are dedicated exclusively to infringement. 
They are not UGC sites. If we send them a takedown notice, they 
are not going to take it down because that is their primary and 
sole purpose. They are also often located overseas. So, the 
DMCA doesn't even apply necessarily to them.
    So, the only way that we can go after those types of sites 
is through a lot of civil enforcement, a lot of trying to get 
law enforcement overseas to actually go after the sites. If we 
are not able to get law enforcement overseas and we aren't able 
to find the website operators wherever they may be, then site 
blocking is the only remedy we have for the United States.
    For example, FMovies is a site where the operators of the 
site are actually located in Vietnam. Their servers are 
actually in Bulgaria. I recently went to Vietnam and requested 
and asked the Vietnamese law enforcement to go after those 
website operators. Again, we also referred this to U.S. law 
enforcement. So far, we have not been able to get that site 
down. So, again, millions and millions of U.S. consumers are 
accessing this illegal content.
    Ms. Lee. Mr. McKnight, you have a unique perspective on the 
takedown process, given your industry. Tell us if you would, 
your perspective on why that is inadequate.
    Mr. McKnight. Yes, we think that essentially the speed with 
which material moments occur in live events. Focusing on UFC, 
in particular, we may have a main car that features a popular 
fighter like Connor McGregor. In 5-10 minutes or less, 
sometimes 5-10 seconds, those moments that the fans care most 
about seeing can elapse. So, if they are able to pirate a 
stream for 5-10 minutes, they get what they want, essentially 
taking away any incentive to pay a dime for a legitimate piece 
of content.
    The technology is advancing, not just the means to access 
the content, but the quality. Some of these feeds, if you look 
at these pirated sites, are HD quality. They are just as good, 
or close to as good, as what you are getting on our site.
    So, our focus is on the definition of expeditious removal. 
We have evidence, empirical evidence that sites can do better. 
These are oftentimes social media platforms, not specifically 
folks who are dedicated to criminal conduct, but simply folks 
who have an opportunity and the technology to do better taking 
down these illegal streams in a way that we believe is 
appropriate. They can do it. We think they have a commercial 
incentive not to always put their best foot forward. We think 
in the absence of clarification as to what expeditious removal 
should mean, which is immediate or near immediate, then they 
will continue to not put their best foot forward. That is the 
issue we have in the--
    Mr. Issa. Would the gentlelady yield for just a second?
    Ms. Lee. Yes, Mr. Chair. I yield the balance of my time to 
the Chair.
    Mr. Issa. We will say balance. Just as a followup to make 
sure it is in the record with your questioning, Mr. McKnight, 
what is the fastest that you have seen takedown occur, just so 
that we understand how fast it has been and can be?
    Mr. McKnight. Yes, we have seen it happen in several 
minutes. That is about the fastest we see it happen. It has 
taken sometimes hours, sometimes days. It is really these 
fluctuations that give us the proof that the best foot forward 
is not always being put forward.
    We have been told by a particular platform that at one 
point we were elevated to kind of most favored Nation status. 
We saw a dramatic improvement for a few weeks. Then things kind 
of went back to what they were, status quo.
    Mr. Issa. I thank the gentlelady for yielding. With that, I 
recognize the Ranking Member for his questions.
    Mr. Johnson of Georgia. Thank you, Mr. Chair.
    Mr. Gladstein, what does copyright enforcement in the 
United States look like for individuals or small group creators 
who do not have access to resources like the UFC's or the MPA's 
Alliance for Creativity and Entertainment?
    Mr. Gladstein. We have various guilds and unions that 
assist filmmakers of all types. So, they are helpful. We rely 
on the distributors, who are often the financiers, of our films 
to make the decisions about where our films go. As a producer 
of Pulp Fiction, I am not, I don't get to weigh in on where my 
film is distributed. I can have an opinion, but it is often not 
listened to.
    I think the important thing to cite is that as a creator, 
the more people that see that very product that I have created 
thrills me. So, there are, I think, 140 legal streaming sites. 
So, it isn't a problem if there is not enough places to find 
the films in legitimate areas. Studios such as Warner Bros., 
Disney, and smaller art house distributors are trying to find 
the most vast audience that they can find in every corner of 
the world.
    We rely on those studios or distributors to issue these 
kind of takedown notices, et cetera. As a filmmaker, it is not 
something that I participate in. I would rather create my next 
movie while someone else is fighting the battle of swiping 
money from us somewhere else.
    Mr. Johnson of Georgia. Thank you.
    Ms. Temple, one of the many developments in recent years 
has been the trend from illegal downloads to illegal streaming. 
Can you explain what the implications of this shift are?
    Ms. Temple. Yes, thank you for the question. To add on to 
what the other witness said as well, in terms of notice and 
takedown and individuals not being able to really protect their 
rights, I will say that it is very difficult. We spend hundreds 
and millions of dollars to develop notice and takedown systems 
to send millions of notices to various UGC sites. Individual 
artists and creators often don't have the ability, and 
resources to do that. So, it is a very difficult situation for 
individual creators. That is something that has often been 
discussed with respect to the DMCA.
    I will say that with respect to how piracy works now, we 
are seeing online piracy that is streaming piracy now be the 
vast majority of the type of piracy that is out there. That is 
more than 90 percent of the piracy that is out there is 
streaming piracy. The difficulty, of course, as I mentioned 
earlier, is that it starts outside of our jurisdiction. So, the 
operators are not in the United States. We are able to go after 
them when they are here.
    The operators might be in one country. The servers where 
the infringing content is hosted might be in yet another 
country. The registrar or registry might be another country's 
registry that is actually like from Tonga. So, it is extremely 
complicated and difficult for us to actively go after these 
dedicated infringing sites because of the global nature of 
piracy.
    Mr. Johnson of Georgia. Thank you.
    Mr. McKnight, can you explain why this is especially 
significant for live events like those put on by the UFC?
    Mr. McKnight. Yes, as mentioned previously, we think that 
the short timeframe with which material moments can take place 
in the context of live events makes it ultimately important 
that platforms are putting their best foot forward in taking 
down this illicit content as soon as possible.
    This proverbial case of justice delayed is justice denied. 
So, oftentimes, if we're getting take-downs in 10-15 minutes, 
and hour, or certainly days, it's too late. The folks viewing 
the pirated streams have already seen these material moments 
and they've already made the decision that if those are 
available, they're not going to pay for legitimate content.
    Mr. Johnson of Georgia. Thank you. The Protect Lawful 
Streaming Act was enacted nearly three years ago to close 
certain gaps that made enforcement of infringement challenging 
when it was conducted by digital streaming. What effect has the 
Protect Lawful Streaming Act had on internet piracy so far, Mr. 
McKnight?
    Mr. McKnight. So, I think that the passage is certainly 
helpful. We worked long to get that passed. We would like to 
see it enforced because I think that the end of the day the 
true deterrent to folks who are professional pirates that we've 
been--some of which we've been speaking about today, is when 
they actually see these laws enforced. So, I think it's a huge 
step in the right direction and we'd love to see greater 
enforcement so that a true deterrent effect can take place in 
the market.
    Mr. Johnson of Georgia. Thank you, and I yield back.
    Mr. Issa. I thank the gentleman.
    We now go to the gentleman from Mr. Wisconsin, Mr. 
Fitzgerald.
    Mr. Fitzgerald. Thank you, Chair.
    Ms. Temple, how does piracy affect the type of films that 
might be financed or produced? Any opinion on that?
    Ms. Temple. Yes, that's a great question. Unfortunately, 
piracy does affect the variety of films that might be produced 
because you--it costs so much money to be able to produce a 
film that you want to make sure that the film will actually be 
able to get back its revenue. If a film is pirated, if it's an 
indie film or a niche film, then the revenue that is going to 
be affected by piracy will even be lower.
    So, unfortunately, that means that you often might see a 
few more of those blockbusters and those sequels and series 
types of films because those you know are going to have a large 
amount of revenue versus being able to have a wider variety of 
types of films. It really does impact minority filmmakers and 
independent filmmakers because they are not able as much as 
some of the larger studios to prevent the piracy that is going 
on.
    Mr. Fitzgerald. Yes, so the studios are more or less likely 
to take a risk on a film knowing that the prevalence of that 
piracy might be related to the content. Does that sound 
accurate?
    Ms. Temple. Yes, exactly.
    Mr. Fitzgerald. OK. Very good.
    Mr. McKnight, the area that you have been discussing is 
fascinating to me, to many other people, because of the live 
stream angle. What financial impact does copyright privacy--do 
you have any idea what impact it has on the live sports 
industry per se? Ballpark or any type of estimate on that?
    Mr. McKnight. So, we've done studies. You can't do it with 
exactitude, obviously, because you can't say every single 
person who looks at a pirate stream is going to convert to a 
paying consumer.
    Mr. Fitzgerald. Right.
    Mr. McKnight. Even if you take very conservative numbers, 
one out of five, you get into tens to hundreds of millions of 
dollars in losses. As Ranking Member Johnson correctly pointed 
out, the real problem here is a lot of people view this as 
victimless crimes, but the lack of these resources aren't just 
affecting an inanimate entity, or the wealthy members of that 
entity. There are also people downstream. They're the athletes, 
they're people who work the cameras, people who work in just 
very basic jobs like in the production crew, driving trucks, 
and doing things of that nature, all whom are impacted by this 
loss in revenue.
    Mr. Fitzgerald. The other thing I would say is as someone 
who--you brought up Connor McGregor, and I have seen a few of 
his fights. Oftentimes, that results in somebody organizing a 
party or bringing a group of people together to watch that. So, 
have you looked at the consumer end of it? Are people aware 
oftentimes that they may be not on an official site, but on a 
pirated site? What do people--how do they gauge where they are 
going to seek their entertainment or a live stream of a 
sporting event?
    Mr. McKnight. So, I think people are aware. I think the 
real issue is, like I said, they view it as somewhat of a 
victimless crime. If you go on a social media platform, for 
example, and someone uploads a UFC fight, you go and you click 
on the link, you don't view yourself as doing anything 
inappropriate. What you think you're doing is getting free 
access to an event you enjoy, and that the wealthy UFC won't 
miss the money they could be obtaining as a result of a 
legitimate purchase.
    When you multiply that thought process by hundreds of 
millions of times, obviously the dollars get significant and 
then you have that cascading effect on everyone involved up and 
down the stream of producing that event that I had mentioned 
before.
    So, I do think they know. They certainly know in the case 
of folks who are going to the professional pirates and paying 
cut rates that are advertising sometimes on the social media 
platforms essentially saying don't buy the event from the UFC; 
come here and get it for free. They're doing it in ways that I 
think it's readily easily to identify that you're not doing 
something proper.
    Mr. Fitzgerald. In a lot of commercial settings, whether it 
be a bar or a restaurant or someplace where they are actually 
using it to bring people to their restaurant or their place of 
business--have you guys looked at that angle of it? Is this 
something that is happening and is it a violation?
    Mr. McKnight. So, we do look at that. We do have commercial 
licensing agreements with many of these establishments--
    Mr. Fitzgerald. OK.
    Mr. McKnight. --that are showing it at bars and things of 
that nature. We have ways to police it when people are showing 
it without paying that commercial fee. That aspect of it is 
actually less of an issue than the individual user going to the 
social media sites or folks going to these professionally 
pirated sites where they are putting these sites up for the 
specific reason of showing pirated content.
    Mr. Fitzgerald. Very good. Thank you very much.
    I yield back, Chair.
    Mr. Issa. The gentleman yields back.
    We now go to my friend and colleague from California, Mr. 
Lieu.
    Mr. Lieu. Thank you, Chair Issa and Ranking Member Johnson, 
for holding this important hearing.
    So, Ms. Temple, I have a question for you. You showed 
FMovies, the online piracy site for movies. If you are in 
Europe and you typed in that website, would you be able to 
watch free movies in Europe?
    Ms. Temple. No, and the vast majority would not because 
again it's been blocked in 16 countries including most of the 
EU. So, you would not be able to access FMovies in those places 
where it has been site blocked through the legislation there.
    Mr. Lieu. Thank you.
    So, Mr. Schruers, I just went on my phone and went on 
FMovies, and it is still up, and I can watch Willy Wonka for 
free without paying for it. Why don't the online server 
providers block it right now, like today?
    Mr. Schruers. So, I take as described the site that we saw 
here, though I do have to ask--that might have to do with 
something with why Federal law enforcement hasn't taken action 
against this either. There are, of course, lots of remedies 
that are available today under existing Federal law.
    Mr. Lieu. I think the reason is because they are based in 
Vietnam. You don't have to take it as described. You can just 
go on your phone right now.
    Mr. Schruers. So, I think we should take a step back and 
recognize that if the remedy that is sought is implemented 
here, all we're doing is preventing a domain name from 
resolving to an IP address, right?
    Mr. Lieu. Right, I think that is important. So, I am going 
to ask the members of your organization to take it down right 
now.
    So FMovies is so popular, there is a whole Wikipedia site 
on it. I just read it. It has been in existence since 2016. It 
was launched seven years ago. It says what countries have 
blocked it, what countries haven't. Your members can take it 
down or can block it right now. I am just asking you to do 
that.
    Because we are trying to be reasonable here. This is such 
an unreasonable case. It is so clearly online piracy, copyright 
infringement. You don't want your organization, your members to 
be defending something so blatantly unlawful and unreasonable. 
So, I just asked your members to block that site today.
    Mr. Schruers. So, the broadband providers that actually 
provide the resolution of these domain names are not at this 
table, right?
    Mr. Lieu. Get them to block the site today. People should 
block the site today because you cannot defend this. It is just 
not defensible, and the Members of Congress here are watching 
this. This is not where you want to be. This is not where your 
industry wants to be. I get the nuances. I may not even oppose 
the views that you espouse today, but this particular site for 
example is not defensible, and certainly not for seven years.
    Mr. Schruers. I think I--
    Mr. Lieu. You did say in your testimony--you talk about how 
your organization and your companies work with stakeholders to 
do with copyright infringement. This has been going on since 
2016. It is so clearly indefensible. I am just asking you to 
take it down, to block it.
    Mr. Schruers. The digital services that are--content 
creators among my constituent are also victims of these sites. 
They, too, distribute content online and their content is also 
pirated. So, this is a broadly shared interest in preventing 
infringement. Obviously, the best tool for that is to make 
content as widely available as possible where and when 
consumers want it. Meeting consumers' needs is--
    Mr. Lieu. So, that is very interesting. I know you said 
that; you put it in your testimony. Do you think people 
actually don't know how they can watch the movie Willy Wonka? 
Do you think with internet search they won't be able to figure 
out how they can stream it and pay for it?
    Mr. Schruers. I think that's a great question because, at 
least as we've been told, Wonka is not yet available on this 
market, but it's available on other markets. So, we often see 
that pirates arbitrage windowed releases to try and take 
advantage of content not being available on one market. That's 
why a number of audiovisual producers have gone to worldwide 
releases, but--
    Mr. Lieu. So, what you are saying is that all movie CDOs 
immediately on releasing a movie in the movie studios need to 
also release it, right, online? Then is that your solution?
    Mr. Schruers. What I'm saying is the best strategy to fight 
piracy, among many strategies, is ensuring that consumers can 
access the content that they want to pay for. We've seen that 
when lawful services are launched in countries where there is 
high piracy, those rates go down because consumers by and large 
want to pay for the stuff. They want to consume it lawfully. 
There's obviously risk to infringing services. The vast 
majority of them want to support the creators that they enjoy.
    Mr. Lieu. Thank you. So, I ask the Members of your 
organization that can block this to block it. If they don't 
exist in your organization, I ask Chair of this Committee to 
call in a hearing with a witness that does represent the 
Members that could block this site and block it now.
    Mr. Issa. Would the gentleman yield?
    Mr. Lieu. Yes. No, no. Go ahead.
    Mr. Issa. Pursuant to your request I will agree to invite, 
if you will, members of the ISP community here to have a 
discussion about the proposed remedies and how some or all them 
might be implemented pursuant to court order. So, that will be 
an invitation that the Ranking Member and I will send out 
before we get to Christmas.
    Mr. Lieu. Thank you, Mr. Chair. I yield back.
    Mr. Issa. I thank the gentleman.
    We know go to the gentleman from Oregon, Mr. Bentz.
    Mr. Bentz. Thank you, Mr. Chair.
    Thank all of you for being here.
    Ms. Temple, I am trying to figure out if this is an issue 
of technology that we can fix it, or a lack of enforcement, or 
something else. So, tell me--as we listened to the exchange 
just previous to my questions, I am a little bit unclear. So, 
which is?
    Ms. Temple. Well, as I mentioned earlier, it is a very 
complicated issue. I will respond to what Mr. Schruers said 
about access to legitimate content. I think that is an argument 
that we were hearing 20 years ago, but quite frankly today, 
there are hundreds of ways to access movies legally online 
through streaming services throughout the world. So, there are 
a wide variety of legitimate offerings for consumers. Piracy 
still exists.
    What makes piracy so complicated and difficult is that 
technology does change and we do have to keep laws updated to 
be able to address the changing technology. As I mentioned 
before, streaming piracy has become one of the most prolific 
types of piracy that we have out there.
    Also, it's cross-jurisdictional again so it's difficult to 
be able to attack the websites where they are. I think 
Representative Lieu was right when he said that probably the 
reason that the U.S. law enforcement has not gone after FMovies 
is because the website operators are in Vietnam. We do 
encourage law enforcement and they do work together, but it 
sometimes takes time and years. We also went to Vietnam. 
Personally, I went to Vietnam to ask law enforcement to take 
action, but they have not done so yet.
    So, if we had a solution in addition to the solutions--this 
is not a panacea. We don't think that site blocking alone is 
the only solution. We still engage in a lot of self-help, but 
if we had that additional tool of site blocking that would 
allow us to be even more effective to combat piracy today the 
way it occurs.
    Mr. Bentz. All right. Well, you take us directly to my 
question of what we should anticipate should the ISP folk come 
in. What are they going to say?
    Ms. Temple. Well, it's interesting because in our 
experience overseas where this has happened in 40 countries, we 
actually worked collaboratively with the ISPs. So, we have had 
great relationships and cooperative relationships with the ISPs 
because they understand that this is a process that is not 
overly burdensome to them. It's a process also that they are 
engaged in.
    So, my hope would be that the ISPs that you would call in 
would talk to the ISPs in the 40 countries that have this type 
of legislation. Then they would realize that the type of 
legislation we're asking for is legislation that works, that's 
effective, and that provides all the guardrails and due process 
issues that have been raised in the past.
    Mr. Bentz. We will see. So, let's stick with this for a 
second. The tools that you suggest: Site blocking, ham-handed, 
not directed. What is wrong with the device?
    Ms. Temple. Yes, certainly those who are not familiar with 
legislation and the way site blocking works could say that is 
the case, but in our experience for the last 10 years, that is 
just not true. The way that site blocking works is in all the 
jurisdictions in which we operate there is a very specific 
process first to assess whether the website is actually 
dedicated exclusively to infringement.
    Mr. Bentz. So, let me hop ahead. Does it on occasion not 
get it right?
    Ms. Temple. In our experience--
    Mr. Bentz. Is it perfect?
    Ms. Temple. Well, no law is perfect, so I can't say that--
    Mr. Bentz. I am not talking about the law; I am talking 
about the technology.
    Ms. Temple. In our experience, as I said, we do not see 
instances of over-blocking or--
    Mr. Bentz. In anticipating a difference of opinion, Mr. 
Schruers, maybe you can answer the question.
    Mr. Schruers. Yes, so I think there are a number of 
examples cited in my testimony and others that we can provide 
where these architectural-level solutions have gone wrong.
    Now, if we're talking about this one site that we've seen, 
and this remedy that's being proposed would only be available 
against that site, then that's one situation. If this remedy 
would be available against any online presence that's accused 
of infringement, well then would this remedy be available 
against campaign advertisements that are alleged to have not 
licensed their music? I mean, we have to ask against what 
constituency can this be applied, first of all. Then second, 
what's the potential collateral damage?
    It may not be remembered, but 10 years ago due to miscali-
bration I understand of IT the digital service Spotify was 
blocked in this building, right? So, mistakes happen, and we 
need to ensure that the remedies are properly scoped for the 
problem.
    Mr. Bentz. Thank you. I yield back.
    Mr. Issa. I thank the gentleman.
    We now go to the gentlelady from North Carolina, Ms. Ross.
    Ms. Ross. Thank you, Mr. Chair and Ranking Member. Thanks 
to all the witnesses for joining us today.
    When artists and creators pour their energy into developing 
a product or a creative work, whether it is a song, a movie, a 
book, an article, a piece of visual art, or anything else, they 
deserve the opportunity to profit from their work. Digital 
privacy is theft of that opportunity. It deprives not only the 
copyright holders, but the individual artists and technicians 
who have contributed to a product to earn their livelihood and 
be able to profit from their creativity and their work. This is 
embodied in our Constitution.
    Ms. Temple, I know you have gotten a lot of questions about 
how site blocking works. Which countries have been most 
effective in executing site blocks while also respecting due 
process?
    Ms. Temple. Thank you for the question. I think in our 
experience the United Kingdom has been very effective in 
implementing site blocks, but also recognizing and protecting 
individual freedoms. Australia is another jurisdiction that has 
extensive experience in this and has been very effective. They 
recently in 2018 did a full review of their legislation to see 
if it had any negative impacts and continued on with the 
legislation because it did not. So, those are two jurisdictions 
that we find to be very, very effective.
    Ms. Ross. Just to pick up in Australia, because you cited 
evidence from studies in Australia that when there were no-
fault injunctions that would encourage a shift to legal 
channels. Can you tell us more about these findings and how no-
fault injunctions affect users' behavior and choices?
    Ms. Temple. Yes, thank you. We've done a lot of studying 
over the last 10 years in which we've been operating in 
countries that have no-fault injunctive relief regimes, and our 
statistics and research shows that not only does traffic to the 
websites, that are actually illegal websites--not only has that 
plummeted, but consumers then go to legal websites. So, we see 
an increase of between 5-12 percent to legal websites after we 
block in a certain jurisdiction.
    Ms. Ross. That is great. That goes a little bit to Mr. 
McKnight's testimony.
    I want to shift a little bit. I represent the Research 
Triangle area of North Carolina, a number of research 
universities, and I want to highlight how digital piracy 
impacts scientific journals and threatens the security of 
American research. For example, Sci-Hub, an active private 
website based on Russia, has amassed over 80 million scientific 
journal articles often by illegally targeting university 
websites in the U.S.
    Mr. Schruers, are you familiar with Sci-Hub and do you know 
if your members, including AI developers, have systems in place 
to ensure that they do not obtain content to train AI systems 
from Sci-Hub or other pirated sites?
    Mr. Schruers. I'm familiar with the website, but I don't 
think I have enough information to answer that question right 
now. I'm happy to followup for the record.
    Ms. Ross. That would be terrific.
    Then for all the witnesses, and maybe we will start with 
Mr. McKnight because I haven't addressed a question to you, 
yet.
    Have there been any international policies that have been 
especially effective at preventing consumers from cyber fraud 
that often result in engagement with piracy sites?
    Mr. McKnight. I think the site blocking that we've been 
talking about has been demonstrated to be effective in certain 
countries, at least against professional pirates. I'm certainly 
not an expert in this area. We're focusing more on expeditious 
removal and enforcement here in the U.S. So, that's how I would 
answer from our perspective.
    Ms. Ross. Mr. Gladstein, do you have anything to add? Then 
we can come to the other two.
    Mr. Gladstein. No.
    Ms. Ross. OK. Mr. Schruers?
    Mr. Schruers. I don't know if I have any more to add to 
that. Thank you.
    Ms. Ross. Ms. Temple?
    Ms. Temple. Yes, I would just add that again we've noticed 
that site blocking has been effective and in our analysis of 
those harms that come to consumers that go to those sites 
you're for example four times more likely to be the victim of 
credit card fraud, four times more likely to be the victim of 
malware, I think 30 times more likely to have viruses on your 
computers. So, site blocking does help protect consumers.
    We were actually very pleased that we were able to work 
with the Department of Homeland Security and the IPR Center a 
few months ago to issue a PSA that talked about the harms to 
consumers from online pirated websites. So, site blocking would 
be able to help that as well.
    Ms. Ross. Thank you very much.
    Mr. Chair, I yield back.
    Mr. Issa. I thank the gentlelady. The gentlelady yields 
back.
    We now go to the gentleman from California, Mr. Kiley.
    Mr. Kiley. Thank you, Mr. Chair.
    Mr. McKnight, I appreciated your testimony and certainly 
understand the harm that is done that is sort of unique when we 
are talking about live sports, that there is a real value 
proposition to actual live consumption. So, a remedy that is 
delayed even by an hour or so is insufficient.
    So, we have talked about various potential remedies, maybe 
redefining expeditiously to mean instantaneously or near 
instantaneously. Could you help me understand kind of how the 
mechanics of this work? Like if there is a fight going on how 
do you sort of in the moment find the illegal streams and then 
alert the ISPs?
    Mr. McKnight. Sure. There's a number of ways. Some of the 
ISPs have automatic--to the extent you can identify and 
digital--the technology, depending on how good the stream is 
and the quality of it, can identify it and pull it down.
    Where we have the issues is where we then have to identify 
and then submit these take-down requests. Then it's a question 
of how fast they take action after that, after those requests 
are submitted. We're seeing very, very uneven performance. In 
some areas there's just nonresponsiveness and that's when 
you're seeing things like hours to days.
    Then with other sites we've worked with we've--social media 
platforms that we've worked with we've seen it happen 7-9 
minutes. It's not terrible, but it's not effective. Most 
importantly we know it's not the best they can do because it's 
been better.
    Mr. Kiley. Right.
    Mr. McKnight. We've had conversations and seen things 
improve, but only momentarily, only to go back to sort of like 
the problematic practices that we observed a long time.
    Mr. Kiley. So, you said that the ISPs--that if the quality 
of the stream is good enough, they can find it. How do they do 
that?
    Mr. McKnight. They have technology. Like say if someone 
holds their phone up to a screen.
    Mr. Kiley. Yes.
    Mr. McKnight. Depending on the quality of which that stream 
is put forth on a social media platform, for example, there is 
technology that can identify it as a problematic stream and 
automatically take it down off of a social media platform or--
    Mr. Kiley. OK. So, it is automatic? In other words, the 
technology identifies this as a copy essentially?
    Mr. McKnight. Correct.
    Mr. Kiley. There is no need for notice and take down, and 
for a person to approve it? It just comes down?
    Mr. McKnight. Correct, in those instances where that can be 
identified.
    Mr. Kiley. So, is there a way to incorporate that 
technology even on the provider side where you could sort of 
include it in--
    Mr. McKnight. Giving us access. Yes. One particular 
provider has offered to do that, but many others haven't. Yes, 
there are technological potential to develop that type of 
technology. Some folks have it already. They're just not 
putting their best foot forward.
    Mr. Kiley. Yes.
    Mr. McKnight. Look, without making accusations, the natural 
commercial incentive, if you're running one of these sites, is 
the more users you have viewing content over your site the 
better it is for you commercially.
    Mr. Kiley. Right.
    Mr. McKnight. Right? So, you don't necessarily have the 
incentive to put your best foot forward here. If you look at 
the law the way it's currently constructed, it's not clear that 
we have a case that hours isn't expeditiously or that even a 
day isn't expeditiously. The point we're making is if you're 
dealing with a live event as opposed to something like a movie; 
and there are other issues there that have been explained well 
by my co-panelists, that isn't expeditiously. It's 
definitionally not expeditiously to not take it down after it's 
already over.
    Mr. Kiley. Right.
    Mr. McKnight. In effect the commercial value is gone.
    Mr. Kiley. Is there any way to--I think there is a way with 
the technology where it can just be scrambled, or whatever, so 
you don't have to have an active taking it down per se. It is 
just that there is no--it doesn't actually--I don't know, Mr. 
Schruers, do you want to weigh in on that as well? Maybe you 
have some technical expertise. I am just trying to understand 
the nature of what is available technologically so that can 
inform the best solution from a policy perspective.
    Mr. Schruers. Filtering technology is sadly not magic. 
There's no metadata that says this is an infringing stream, 
although perhaps humans can determine from certain contextual 
clues whether or not something is authorized, although we can 
get that wrong, too.
    Mr. Kiley. How can you not make that--if you have one 
authorized transmission wouldn't any retransmission of that 
sort of definition unauthorized? So, that could be identified?
    Mr. Schruers. So, there's a crucial piece of data there, 
which is what is the authorized transmission? A number of 
leading services do allow and invite live sporting events to 
pre-identify what content is lawful. They may furnish hashes 
that allow for real-time filtering, but that does require data 
and interindustry collaboration to ensure that the digital 
services have the tools to prevent the content from being 
ingested into their system. Of course, that all assumes that 
this isn't just a hyperlink to some site elsewhere.
    Mr. Kiley. Right. Yes. Did you have anything else you 
wanted to add? I am sorry, Mr. McKnight.
    Mr. McKnight. Well, I would just say in our case we only 
have one legitimate authorized partner in the U.S., which is 
ESPN+. So, if our live events are being shown anywhere else, 
it's definitionally unauthorized.
    Mr. Kiley. Right. Right. OK. Thank you very much.
    Mr. Issa. I thank the gentleman.
    Continuing with our California run, the gentlelady from San 
Jose, Ms. Lofgren.
    Ms. Lofgren. Well, thank you very much, Mr. Chair, and 
thanks to each one of these witnesses for their excellent 
testimony.
    Mr. Gladstein, no one is going to defend that infringing 
site, including me. To me the only question is how do we 
prevent this piracy? None of us should be defending it, and I 
include myself very much in that category.
    It was just 12 years ago that we had a very tumultuous 
markup in this room. I think just Mr. Issa, Mr. Johnson, and I 
were here. At the time technical experts: The Internet Society, 
ICANN, and others, strongly advised against DNS-level filtering 
or blocking and instead urged that content-level decisions be 
made at the network edge and not at the internet's 
infrastructure core. I think that probably continues to this 
day. So, the question is what are the best remedies? I think 
that is something I would love to focus on, Mr. Chair.
    One of the things that I am interested in is when we have 
done a number of laws to help on this, I would like to know how 
they are being administered by those charged with enforcement. 
For example, the Copyright Claims Board has the ability to take 
action as part of the CASE Act, which I supported. I don't know 
how that is going. I would like to know that. Obviously, that 
is not the major studios.
    Federal prosecution under the Protecting Lawful Streaming 
Act of 2020. What has been done on that? Has the DOJ brought 
any cases? I would like to know about that.
    The National Intellectual Property Rights Coordination 
Center led by Homeland Security is supposed to help with the 
Protecting Lawful Streaming Act. They have a center there. How 
is that working? I would like to know that as well.
    One of the concerns, I think that we are missing the boat, 
frankly, and I thought so 12 years ago when we had this 
tumultuous markup. These piracy sites would not exist if they 
weren't lucrative. They are making money and that is why they 
exist.
    There are problems in terms of the effectiveness of trying 
to block IP addresses. There are technical issues that the 
internet engineers brought to a head 12 years ago, but there is 
no technical problem in preventing the funding. If the credit 
card companies are going to be told they cannot process the 
funds for a variety of sites, these sites will go away.
    Now, there is a problem internationally, but the OPEN Act 
that I supported would have made the copyright trademark 
infringements and unfair trade practice and would have brought 
in the U.S. International Trade Commission as a partner in 
this. I think even though sometimes we are not happy with their 
level of concern, and sometimes they go in the wrong direction, 
it is a hook actually in terms of going abroad with the 
financial services component of this. To me the answer has 
always been to cutoff the money and this will go away.
    So, I am interested--Mr. Schruers, you are the only one 
here with--speaking from technology, and I know the Chair has 
said we are going to have other hearings on technology, but 
part of--YouTube for example has gotten the digital file for 
various content, so that they can take action when there is an 
infringement.
    One question I have, and it has been problematic, because 
you can make minor changes to that digital file and evade it--
have we explored or is it even possible to do that kind of 
digital file on a broader basis and would it work given the 
alteration that could be made?
    Then if anybody has a comment about cutting off the money, 
which I think is probably going to be the most lucrative, the 
most effective method we can--I would be very interested.
    Mr. Schruers. Thank you for the question, Congresswoman. I 
think that's a great point. There are among leading services 
and leading content providers evolving strategies to share what 
we call hashes, which are sort of like digital fingerprints of 
a piece of content. Digital services will filter for that hash. 
That's used both in the copyright context and outside of it, 
and it's a very effective way to intercept at the point of 
ingestion content that should not be in a particular place or 
should not be available for any number of reasons.
    Obviously, technology is expensive. It has to be 
implemented in each service in a different fashion, but it is a 
very effective way to solve these problems at the front end. It 
requires a lot of intersectoral cooperation.
    Ms. Lofgren. I see my time is expired, but I would invite 
the witnesses--
    Mr. Issa. I would ask unanimous consent that the gentlelady 
have one additional minute. Without objection, so ordered.
    Ms. Lofgren. Thank you. I would just invite each of the 
witnesses to comment, even after this hearing, on the concept 
of denying access to financial rewards through the financial 
system, the credit card companies and the like, on how we might 
work together to explore that. I know that we have got just a 
few minutes here and it is a deep subject.
    Mr. Gladstein. May I make a quick comment?
    Ms. Lofgren. I would love to make this impossible to profit 
from.
    Mr. Gladstein. May I make a quick comment?
    Ms. Lofgren. Sure.
    Mr. Gladstein. One of the issues with following the money 
that might not service this issue as well as you've just 
stated, quite frankly, is that many of these sites don't charge 
the consumer anything to be able to watch that film. So, what 
Netflix or Apple or anyone is competing with is the free 
dispersal of the product. The way in which those sites are 
making money is from advertising and from selling malware that 
they get from those that go onto their sites. For credit 
cards--
    Ms. Lofgren. Right. So, we would have to go after the 
advertisers as well?
    Mr. Gladstein. So, the consumer isn't using their credit 
card. They're just hitting a button. The technology is such 
that the programming that they're watching doesn't look like 
someone sat in the back of a theater with their iPhone and 
copied the movie. It is a digital copy of the film that looks 
exactly like the film I just made. I couldn't tell the 
difference between the version that's on FMovies and the 
version that's on Netflix.
    So, following--and also bitcoin is used often now.
    Ms. Lofgren. Right.
    Mr. Gladstein. There are various other ways in which these 
folks doing this illegal activity is doing other illegal 
activity and benefiting from those that are going on to their 
sites. So, merely the credit card is not a solution, I don't 
think.
    Ms. Lofgren. Not all of it.
    Mr. Chair, I appreciate your giving me an additional 
minute. I will just close with this: I hope we don't get into 
another tumultuous dysfunctional technical fight as we did 12 
years ago, but I do think we have a lot of opportunity to look 
at enforcement including DOJ, including potential financial 
cutting off. I think the gentleman's testimony is enlightening 
and we could spend a lot more time getting into this and maybe 
getting some real results. So, I yield back, and I thank--
    Mr. Issa. I thank the gentlelady. Those 12 years ago the 
names SOPA and PIPA were bantered around, and we thought that 
this was going to be a solution without any debate. I can 
promise the gentlelady that we are going to invite all the 
parties, we are going to go through a process that at least 
makes sure that all facts and capabilities are known before any 
legislation goes forward.
    I have a history with several here on the dais of fighting 
against our own Chair at the time and Ranking Member and 
against the Senate. We won, but unfortunately the content 
producers do not have a solution. So, I want to find justice at 
a fair rate, something that you and I fought against more than 
a decade ago, but we know we still need to protect the content 
producers. So, I look forward to working with it and I promise 
an open and transparent process.
    Ms. Lofgren. Very good.
    Mr. Issa. I know thank the gentleman from Virginia for his 
patience and yield to him.
    Mr. Cline. Let me tell you, Mr. Chair, thank you for the 
time. I want to thank the gentlelady from California, because I 
wasn't here 12 years ago, but I was here 20, 25 years ago, but 
I was sitting back there and watching the DMCA debate and 
watching the telecom activate. So, this is fascinating for me, 
and I appreciate the gentlelady's expertise and all her work.
    Ms. Lofgren. If the gentleman will yield, I think--
    Mr. Cline. I am happy to.
    Ms. Lofgren. --the Chair, former Chair, and I may be the 
only Members of this Subcommittee who were here when the DMCA 
was approved, and obviously the technology has changed since 
that time. So, I appreciate your--
    Mr. Cline. It has. I would want to start by agreeing with 
the gentlelady in her comments about DOJ. In 2020 only four 
criminal copyright cases were charged. In 2021 only five were 
charged. Only three were charged in 2022. So, we have a ways to 
go.
    I would like to have DOJ here and have the opportunity to 
get into a discussion with them about this issue, because there 
are so many different issues with DOJ that we have to discuss 
that it is a challenge to cover everything you need to. With 
this topic I think having a specific hearing regarding the lack 
of prosecution would be helpful.
    I also want to address your comments about the technologies 
12 years ago. The changes in technology might not be all that 
significant, but when you are talking about the internet, I 
mean 12 years is a lifetime. I would guess that there have been 
changes in technology that may make site blocking more 
feasible, more effective, maybe more targeted.
    Ms. Temple, can you comment on any of the technological 
developments in that area?
    Ms. Temple. Yes, I think the main thing that we have 
learned over the last 10 years of working with these laws with 
ISPs is to work again collaboratively with them and provide 
them flexibility in terms of the use of technology. I know that 
there's been a lot of talk about DNS-level blocking, but that's 
not the only type of blocking, and that's not even the primary 
type of blocking that we're talking about.
    So, when we ask for site blocking orders overseas, we work 
with the ISPs. They have flexibility in the law in terms of 
utilizing the most effective and most efficient and least 
burdensome type of technology, whether that is DNS blocking, 
IPS address blocking, or URL blocking. So, that is one of the 
things that we've found to be--one of the most effective ways 
to accomplish it is to work collaboratively with the ISPs and 
allow them the flexibility to determine how they will actually 
implement blocks that don't negatively affect networks.
    Mr. Cline. Mr. Schruers, I will give you the opportunity to 
respond there and talk about the technologies that are used.
    Mr. Schruers. So, it's critical to think about the--I'd say 
the first question you have to ask is: At what level of 
abstraction are we solving this problem? I'd say throughout the 
digital sector there's an interest, a desire, an urgency about 
responding to piracy because in many cases these sites are 
dangerous. Of course, there's a lot of content interest within 
the digital sector. So, everybody agrees this is a problem.
    Mr. Cline. I want to go specifically to the technology, 
though.
    Mr. Schruers. Right. So, as to the technology, if we're 
talking about broadband providers at the architectural level--
and I should make clear those--not principally my constituents 
and I don't want to speak for them--I am aware of and my 
testimony cites a number of problems with that.
    For digital services that are at the edge of the network 
they, of course, comply with the Digital Millennium Copyright 
Act notice and take down, and maybe go above and beyond that 
and do allow even live events to pre-identify URL-level 
filtering to ensure that URLs don't resolve.
    Mr. Cline. How many take-down notices do CCIA members who 
operate content platforms receive in a given year?
    Mr. Schruers. I don't have that at my fingertips, but the 
number is in the millions, if not the billions.
    Mr. Cline. OK. How much money is spent processing these 
take-down notices?
    Mr. Schruers. Again, I don't know that companies break that 
out, but they spend extraordinary amounts not only on the 
processing by their trust teams, but on the development of 
technologies that go well beyond what they're required to do by 
law. Tens of millions of dollars are being invested every year 
for some companies in their systems that don't just block 
content, but actually allow rights holders to monetize 
infringing uses of the works.
    So, in many cases they're given the option to say, hey, I 
can leave this content up and get a share of the revenue if I 
so choose, or of course have it removed. Increasingly rights 
holders choose to do that and get a cut of the ad revenue, 
which is a win/win.
    Mr. Cline. Mr. Chair, my time is expired. I would just like 
to note that this hearing is focused on audiovisual, but 
copyright piracy impacts several industries, from movies, 
music, books, and publishing. I would like unanimous consent to 
submit a comment for the record from the American Association 
of Publishers regarding the online--
    Mr. Issa. Without objection, so ordered.
    Mr. Cline. Thank you, Mr. Chair.
    Mr. Issa. If the gentleman would yield, I would share with 
you that I was not here in 1998, but I was Chair of the 
Consumer Electronics Association.
    Mr. Cline. OK. Yes.
    Mr. Issa. So, we were paying close attention and working 
closely, of not collaboratively, with the MPAA.
    Mr. Cline. Mr. Chair, I do see a lot of familiar faces who 
might have been on this side of the dais, whether staff or 
otherwise, out in the audience and they may be a little grayer 
and a little more wrinkled, but they are recognizable today.
    Mr. Issa. Just as interested. I thank the gentleman.
    We now go to the Ranking Member of the Full Committee, Mr. 
Nadler.
    Mr. Nadler. Thank you, Mr. Chair, for holding this 
important hearing. Mr. Chair, not only do the creative arts 
serve to entertain and educate us, but they also support 
industries that contribute billions of dollars to the economy 
every year. Those industries exist because of the audiences 
that buy their final product. We as consumers want the 
inspiration, emotion, and diversion evoked by artistic 
expression. In exchange we are expected to pay a fair market 
rate for those products no matter the format in which we 
consume them.
    Intellectual property laws including copyright laws exist 
to foster creativity and innovation. They are a promise that 
with hard work and a lot of luck you can monetize your 
imagination. No technological changes have challenged that 
promise like the advent of the internet. Even as technology 
helped us discover art beyond our small corners of the world it 
made those creations easier to steal and thus less lucrative to 
produce.
    Copyright law is nothing without the ability to enforce 
those ownership rights. It was with this reality in mind that 
in 1998 when the internet was still in its infancy Congress 
passed the Digital Millennium Copyright Act, or DMCA, to 
protect copyrighted works online. Even with that landmark law 
in place copyright piracy is still an issue that threatens 
industry stability and artists' livelihoods, and the problem is 
growing larger each year.
    I appreciate the opportunity to examine the issue of 
piracy, but as we consider any potential solutions, we should 
make sure we are looking at the problem not as it existed 25 
years ago, but as it exists today. Copyright piracy now 
encompasses broad cybersecurity concerns, artificial 
intelligence considerations, and distribution changes like 
streaming services. Any action we contemplate must be flexible 
enough to stand not just the test of time, but also changes in 
technology that we cannot possibly imagine.
    Artists and content creators deserve to have their works 
and industries protected from illegal online piracy and I am 
grateful to Chair Issa and Ranking Member Johnson for giving 
this issue the attention it deserves. With that in mind I have 
a few questions for our excellent panel of witnesses.
    Ms. Temple, could you please help clarify the differences 
between IP address blocking, DNS blocking, and dynamic site 
blocking? When and how are each of these remedies useful?
    Ms. Temple. Yes, thank you for the question. As I mentioned 
earlier, in most of the jurisdictions in which we operate the 
site blocking order that is issued is flexible, so the ISP is 
just ordered to block access to the site. The actual way in 
which that is done is up to the ISP. They might use DNS 
blocking. They could use IP address blocking or URL blocking. 
In most cases it's usually either DNS or IP address blocking.
    With respect to DNS blocking it's typically--imagine I 
guess sending an envelope through the mail and you have an 
address that you're looking for. The ISP, the access ISP is 
going to need to look for the address of pirate.com, for 
example, because they don't know the specific IP address. They 
have to go to a DNS resolver and get the actual physical IP 
address, the 12312.34.5 address for the website. So, in DNS 
blocking the access ISP knows that they should not be going to 
look up the IP address for that site. Instead, usually they 
just disregard the request to go look up that site. So, they 
can't get the address to that website.
    IP address blocking is similar, but it's looking at the IP 
address. So, as opposed to the pirate.com issue it might--if 
you know the actual IP address, the ISP will not actually allow 
access to the specific IP address that the website has.
    Then URL blocking is a little bit more complicated, but 
that is really they inspect the packet that's going over the 
internet and ensure that the very, very specific URL is not 
able to be returned back to the customer.
    Mr. Nadler. Thank you.
    Mr. McKnight, one of the primary challenges of enforcing 
anti-piracy laws is that the source of most pirated content is 
overseas. Could you please explain why this is significant and 
what policies if any can improve identification and enforcement 
of overseas actors?
    Mr. McKnight. So, a lot of our enforcement efforts are 
actually based here domestically because even though it is 
certainly true, as has been explained by my co-panelists, that 
a lot of the problem does start and originate overseas, a lot 
of the social media platforms in things like Facebook, Twitch, 
the usual suspects that we're seeing our content pirated over, 
actually here is domestically in the U.S. So, when we're 
looking for the definition of expeditious removal to be 
clarified, it's primarily to address that issue.
    The closing of the streaming loophole, which was something 
that we got--you all helped us get passed in 2020, has been 
tremendously effective. I think with respect to that it's all 
about enforcement, domestic or overseas is getting enforcement 
against these career pirates. Because unless they see folks 
actually going to jail or being shut down as a result of this 
legislation that's powerful and has been enacted, they don't 
necessarily have a full incentive not to engage in the conduct. 
They pay attention to laws being passed. It's meaningful. It's 
helpful. What's really helpful is when they see folks being 
caught and they see them suffering consequences.
    Mr. Nadler. Thank you. My last question is to Mr. Schruers. 
Mr. Schruers, sites hosting pirated content often endanger 
consumers through malware, cyber schemes, and insecure 
connections. If in your view site blocking regimes go too far, 
how do you suggest we keep consumers safe?
    Mr. Schruers. So, thank you for the question. Obviously, as 
I said, the best defense is a good offense and making content 
widely available on as many platforms and in many contexts 
possible is one of the first things that we need to do.
    Once we've moved beyond that we need to look at 
interindustry collaboration to ensure that digital services 
have the granular data and metadata about content to 
meaningfully pre-identify, for example, in the context of live 
streams that something would be infringing, to filter on 
ingest, and obviously strike arrangements such as those that I 
described earlier where in some cases rights holders can choose 
to monetize instead of simply prevent. So, there's a lot of 
options available.
    Then of course we have the existing panoply of remedies 
that are available under existing copyright law. Statutory 
damages, actual damages, all the extrajudicial relief that's 
available under Section 512, to say nothing of technological 
protection measures and small claims. There are probably more 
remedies in the Copyright Act than many of our other IT laws.
    So, we have a lot of robust tools at our disposal. There 
are many arrows in the quiver that we can use. To be clear, 
we're only raising concern about one specific arrow and one 
specific context when we raise concerns about DNS-level site 
blocking.
    Mr. Nadler. Thank you. Mr. Chair, I thank you for your 
indulgence and I yield back.
    Mr. Issa. You have always granted me similar indulgences. I 
thank the former Chair and Ranking Member.
    Now for me. Mr. Schruers, I found it interesting that one 
of the things we haven't gotten too much into is Mr. McKnight's 
question. From your knowledge, technical knowledge, forgetting 
about how something is blocked, when Mr. McKnight puts in a 
notice and take-down, is there any reason that it should not be 
able to be done in single-digit minutes as it sometimes is, or 
even faster today based on technology?
    Mr. Schruers. So, the ability of a given service is going 
to respond to take-downs are going to vary depending on the 
context, the nature of the work, the scope of the take-down. 
It's not uncommon for a rights holder to submit millions of 
URLs, some of which may not be accurate. Because every take-
down does terminate access to expressive content, there are 
consequences for getting things wrong.
    So, I know many services are instantaneous. A lot of 
services that allow rights--
    Mr. Issa. Wait a second. I didn't ask that question. I only 
asked is there any technological reason that it can't be done 
instantly?
    Mr. Schruers. When access to content is terminated--if you 
remove--
    Mr. Issa. You are getting into the ramifications. Maybe I 
will clarify my question. We I think can all agree that the 
technology using AI is available for Mr. McKnight to submit for 
it to be validated against metadata comparison. If he is making 
that data available through the live stream, the idea that it 
can be compared and identified and taken down essentially 
without human interaction would seem to be unequivocal. So, it 
sounds like there may be administrative reasons that an entity 
can respond to why they're not taking it down.
    As the entity that created the original notice and take-
down and the entity that can update it, as Mr. McKnight is 
asking us to, is there any reason we shouldn't update a 
requirement that it either be taken down using that technology, 
which is near-instant, or that he or his--any company receive a 
response within the same period of time as to that which delays 
it?
    That is what I am asking. It is much more narrow than the 
other subjects we are talking about because we are not talking 
about do you have the capability? We are assuming the 
capability exists, because it does exist for notice and take-
down. What is your response to that? Either do it or respond 
near instantly?
    Mr. Schruers. I think we agree that an expeditious response 
is appropriate, particularly where there's economic 
consequences as have been described. Of course, Section 512 
already requires expeditious response. There has been some 
litigation about what that means in practice.
    Mr. Issa. Well, we are really good at eliminating the need 
for litigation by redefining to the courts what we really 
meant. It sometimes saves a court a lot of trouble.
    Let me just go on with another round of questions. Ms. 
Temple, you have heard a lot here and you certainly saw us say 
we don't want to have SOPA and PIPA revisited. We want to have 
full and complete. I want to leave free speech in another 
bucket, but I want to ask you a question.
    Based on the actions of these internet providers of using 
their protections under 230 to regularly take down infringing 
content that you often see--in other words Mr. McKnight and 
others, and even Mr. Schruers has said that providers do it, 
but lawyers say sua sponte. They do it without a complaint 
often and they do it with reasonable protection. If they can do 
it without a complaint, as they often do, by matching, is there 
any reason that we shouldn't encourage them to do it more often 
or substantially all the time?
    Ms. Temple. Yes, if you're talking about filtering and 
ensuring that illegal content is not posted up on UGC sites, 
that is something that certainly we want them to do more of and 
we want to have more automated ways that you don't have to send 
them millions and millions of notices that the other mentioned.
    With respect to dedicated websites, of course it's much--
that are dedicated to infringement, are not UGC sites where 
people are posting, it is much more complicated because those 
websites are not going to take down the infringing content. 
They're not going to filter it out because they're dedicated to 
piracy.
    Mr. Issa. Let me close with just a couple of questions.
    Mr. Gladstein, I haven't asked you any questions, but I am 
going to ask these questions in a sense on your behalf as a 
producer of content that finds himself somewhat harmless--or 
harmed without any ability. I might note that at one time I had 
dinner at a large banquet, but we were at the end of the table. 
It was Francis Ford Coppola who bemoaned how little control he 
had over Godfather III, and if he had only had more control how 
much better it would have been. So, it is not just the fire and 
forget. Sometimes it is even when you are producing it.
    Ms. Temple, because you have this unique expertise on both 
sides of it, let me just ask a few simple technical questions. 
To the best of your knowledge when somebody imports a tangible 
product that violates IP rights, including patent, trademark, 
copyright, does the U.S. Customs have the authority to stop it?
    Ms. Temple. Yes, it does.
    Mr. Issa. When a court or the ITC issues either an 
exclusion order in the case of the ITC or injunction in the 
case of Article 3, do all Federal agencies have the ability to 
use their powers to stop the importation of those products?
    Ms. Temple. Yes. Yes, they do.
    Mr. Issa. So, today as a closing question aren't we just 
talking about finding the equivalent of what for 200-plus years 
our Customs and other agencies have done when there is due 
process and entities such as Article 3 courts have reached a 
decision? The execution of that protection is done by our 
government or on behalf of our government by orders to those 
who participate in bringing things into the United States?
    Ms. Temple. Yes, I would agree that's a very similar 
process.
    Mr. Issa. So, as we invite the Department of Justice, which 
was suggested, and as we reinvite those who chose not to be 
here today, those who can talk to us about--Mr. Schruers, I 
appreciate your expertise, but I want to have more of those 
entities in here to talk about what is technically possible, 
not just what is technically difficult. Because it is this 
Committee's jurisdiction and this Committee's decision that we 
protect through our ports of entry when a DVD comes in bootleg, 
we must be able to protect on the internet. If we do not have 
that ability today, it is our responsibility to create that 
ability.
    I want to close by just making one statement: I know there 
have been good-faith negotiations that have gone on behind the 
scenes. I have been told that those negotiations broke down to 
a certain extent because of hold harmless questions in our very 
litigious society. It is also the jurisdiction of this 
Committee, at the Full Committee level, to provide that type of 
protection.
    So, let's be clear that in getting it I am aware that if 
you get a court order and Customs seizes DVDs coming into the 
country, everybody is held harmless. There isn't, in fact, a 
government right to do so, and all you can do is maybe get your 
DVDs back later if there was a mistake. You don't get to 
litigate against the person that brought the claim in court.
    What is possible in the tangible world; I want to put on 
notice those that we are going to have in followup, we want to 
find a solution in the internet world. We will not quit under 
this Committee, including my Ranking Member to my left and my 
Full Committee Ranking Member also to my left, until we do so.
    With that I want to thank your witnesses and I want to 
thank all those in attendance who often represent people who 
did not speak here today. With that we stand--oh, I am sorry. 
All Members will have five days to issue questions.
    I would ask the witnesses would they respond to written 
questions if they receive them?
    Ms. Temple. Yes.
    Mr. Schruers. Yes.
    Mr. Issa. Thank you. With that we stand adjourned.
    [Whereupon, at 11:51 a.m., the Subcommittee was adjourned.]

    All materials submitted for the record by Members of the 
Subcommittee on Courts, Intellectual Property, and the Internet 
can
be found at: https://docs.house.gov/Committee/Calendar/ByEvent 
.aspx?EventID=116671.

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