March 19, 1999

Bill on Protecting Databases Resurfaces in House

By JERI CLAUSING

ASHINGTON - The Clinton Administration and a diverse coalition of academics, Internet companies, banking and medical groups on Thursday lined up against legislation that raises a complex but key policy issue for the digital age: how to protect databases from pirates without limiting access to information that has historically been part of the public domain.

The bill, by Representative Howard Coble, a North Carolina Republican, is being sought by companies concerned that new technology allows competitors to quickly and easily copy massive collections of information that they compile, catalogue and resell. Because such collections generally consist of information in the public domain, they are not subject to copyright or other intellectual property protections.

But opponents say the bill goes too far, and could ultimately result in electronic toll gates to information that is now widely available free on the Internet -- from scientific research to stock quotes, telephone and e-mail listings, even directories of Internet domain names.

A similar proposal by Coble was passed twice by the House last year. But it fell victim to last minute House and Senate negotiations and was stripped from a larger bill, the Digital Millennium Copyright Act.

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Because database companies compile facts and lists of what generally is information in the public domain, their collections are not subject to copyright or other intellectual property protections.

Coble, at the first hearing on the issue this session, told the House Judiciary Committee's subcommittee on intellectual property that his new bill tries to strike a balance between the competing interests. "The balance provides adequate protection to insure there is an incentive for companies to invest in the development of collections of information, without inhibiting members of the scientific, library and research communities from carrying on their work."

And Coble, who is chairman of the subcommittee, promised to continue working to appease concerns of opponents.

But the two sides are still far apart. A coalition of more than 100 companies, education institutions, nonprofit and trade associations signed a paper given to the committee that said the proposal remained too broad, and would change the basic information policy of the country -- one that has historically protected expressions, not facts.

The Clinton Administration echoed those concerns.

Andrew J. Pincus, general counsel for the Department of Commerce, said the Administration recognized that there were legal gaps that currently allow the piracy of databases that companies have spent a lot of time and money creating. But he said a final proposal needs to be much more narrowly crafted so everyone knows "where the lines are drawn."

Charles E. Phelps, provost of the University of Rochester, said the current proposal would be a nightmare for researchers, who he said would need armies of lawyers to determine what kind of information to which they would and wouldn't have legal access.

"While there may be enough attorneys to guide us through this maze, we could not afford them," he said, urging that if Congress is in doubt, it should "err on the side of access."

The bill would make it illegal for someone to extract all of or substantial parts of a collection of information, if the action would "cause harm to the actual or potential market" for the owner of the database. Violators could faces fines of up to $250,000 for each offense and five years in prison.

Pincus suggested that the bill be changed to limit its reach to commercial pirates. He suggested the legislation apply only to those who, without authorization "extract for commercial distribution or distributes in commerce" all or a substantial part of a database. He also suggested that the threshold of causing harm be increased to substantial harm.

Pincus and others said they were also concerned that the law would allow companies to claim the market rights to certain areas of data collection. That would be a boon both to powerful companies already established in the database market and to speculators or new companies looking to enter a market.

"I fear this could lead to a gold rush of sorts - people running out to stake their claims," Pincus siad.

Marc A. Pearl, general counsel and vice president of government affairs for the Information Technology Association of America, compared the potential for speculative market claims to the first-come, first-serve policy that allows "cybersquatting" of potentially lucrative domain names.

"Anyone could put up a Web page and claim the rights to a certain market for databases," he said.

But witnesses representing database interests urged the committee not to make any more changes to the bill.

"Any additional changes must be viewed with great care and cautiousness," said Marilyn Winokur, executive vice president of Micromedex, which compiles and publishes a host of medical-related database, including the Physician's Desk Reference. "We cannot so dilute the bill as to undermine its effectiveness as a tool against database piracy."

Winokur, who was representing the Coalition Against Database Piracy, said database companies invest millions of dollars annually in the hardware and software needed to manage large bodies of information.

The Coble bill, she said, "is about eliminating the inequity in a legal regime that allows an unscrupulous competitor to copy with impunity the contents of someone else's compilation and then destroy the first compiler's market by selling a competing less expensive product.

"It is also about rectifying the injustice that takes place when a dishonest customer or a 'cyberprankster' -- without permission -- electronically copies and makes it freely available over the Internet. In sum, it is about helping restore fairness to the database marketplace."

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• Representative Howard Coble

• House Judiciary Committee

• Department of Commerce

• The University of Rochester

• Information Technology Association

• Micromedex

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Jeri Clausing at jeri@nytimes.com welcomes your comments and suggestions.

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