One of the biggest challenges for a variety of firms is dealing with online piracy. Recently, Congress has been debating the different provisions of the Stop Online Piracy Act. This is a proposed regulation that is increasing the enforcement of existing copyright laws over the Internet. However, debate about the ethics surrounding the legislation has created tremendous amounts of animosity. To fully understanding what is happening, means examining different viewpoints. Once this takes place, is when we will highlight how this is impacting the way business law cases are argued.
Over the last several years, the issue of online piracy has been increasingly brought to the forefront. The reason why, is because the total amounts of economic losses have risen dramatically (with this accounting for $12.5 billion in the United States alone). At the same time, the total number of counties that are actively involved in online piracy is continuing to increase. Evidence of this can be seen by looking at the below table (which shows the top countries for online piracy). ("Online Piracy Numbers," 2012)
Countries Involved in Online Piracy
Percentage of Online Piracy
("Online Piracy Numbers," 2012)
These figures are important, in illustrating how online piracy is becoming a major problem for developing nations. This is because these activities have become so common in places such as
China that this is viewed as normal. In the long-term, this will have a negative financial impact on the producers of movies, videos, music, published materials and software. ("Online Piracy Numbers," 2012)
To address these issues Congress is considering the Stop Online Piracy Act (SOPA). This is a proposed regulation that will give law enforcement greater powers to enforce the online trafficking of counterfeit goods and intellectual property. To administer the various provisions, the police would be able to obtain a court order. This will prevent advertising companies and payment processors from conducting business with anyone who is involved in illegal activities. These include: bans on search engines and internet service providers (ISPs) from linking with these kinds of sites. Anyone who is in violation of these provisions will be subject to a penalty of five years in prison. In response to the legislation, both opponents and proponents have been debating the impact of this regulation on Internet related activities. To fully understand the ethics behind the arguments requires looking at the views of both sides. Together, these elements will provide the greatest insights as to how morals are shaping the debate on this issue from a business law perspective. ("SOPA," 2011)
The Views of Proponents
Proponents of SOPA believe that the law will go a long way in cracking down against online piracy. The main reason is because these activities are allowed to go unchecked under existing regulations. What is happening is a number of foreign web sites have been developed. They allow their customers to download copyright protected materials for free. This gives them ability to circumvent U.S. copyright laws. Once this takes place, is when the creator of the original content will lose money by not receiving the royalties that they are entitled to. As a result, proponents will argue that by having this kind of law in place. Congress is protecting revenues, jobs and intellectual property rights. (Vefedias, 2012)
These views are important, because they are showing the ethics that are involved with copyright law. This is when someone has the right to be compensated for their work and ideas. If everyone is allowed to download anything they wanted to. This would create a system where no one is compensated for their efforts. Over the course of time, this will eliminate any kind of incentive for individuals to innovate. (Vefedias, 2012)
Moreover, there is case precedent that supports the idea of the individual having their intellectual property rights protected at all times. Some good examples of this can be seen with the following U.S. Supreme Court cases to include: Burrow -- Giles Lithographic v. Sarony, Wheaton v. Peters, Mazer v. Stein, Fortnightly Corp. v. United Artists, Sony Corp. v. Universal Studies, Stern Electronics v. Kaufman and UMG v. MP3. These different cases establish how copyright protections can be applied to: any television show, movie, written document, art work, music, web site and software. This is important, in showing how there is a legal precedent in supporting these views. As a result, SOPA is taking these basic protections and extending them further to cover issues with foreign-based web sites. This will provide a de facto way of preventing the sale of copyright materials over the Internet. (Boyden, 2010) (Vefedias, 2012)
At the same time, the increased enforcement provisions and harsher punishments will serve as a deterrent for anyone that is involved in these activities. This will give the police the power to aggressively investigate and prosecute suspects. From an ethical viewpoint, proponents will argue that this law is protecting the rights of the individual to create new ideas. This will ensure continuous amounts of innovation (which will produce new products and services for everyone). Once this happens, is when the individual will be able to be compensated for their ideas and the time they have spent in developing them.
From a business law point-of-view, these regulations will ensure that current system is enhanced. This creates an environment where everyone will respect the intellectual rights that have been established by previous case precedent. Otherwise, anyone who is involved (in these activities) will be aggressively investigated and prosecuted to serve as a deterrent. This is the point when everyone will act within the moral guidelines that are established by the legal system. (Vefedias, 2012)
The Views of Opponents
Opponents will take a much different view when it comes to copyright protections. According to these individuals, this law will stifle any kind of innovation. The reason why is because, law enforcement can impose limitations on: entire groups of domain names down to a single URL address. This is troubling, because it means that at some point in the future entire sections of the Internet could be shutdown based on copyright concerns. (Gross, 2012)
Moreover, there is language inside the law that will remove any kind of protections that ISPs are receiving from the safe harbor provisions of the Digital Millennium Copyright Act. At the same time, various nonprofit groups and libraries are concerned that they could be subject to prosecution from photocopying any kind of materials. This has led to massive amounts of protests from a host of ISPs, cable providers and Internet-based organizations such Wikipedia. (Gross, 2012)
A good example of this occurred recently, when several different websites (i.e. Wikipedia, Yahoo and Google) announced that they were having a massive 12-hour blackout. This was designed to show the public, what could happen if the different provisions from SOPA were enacted. However, after facing tremendous amounts of backlash, Congress decided to shelf the bill. (Gross, 2012)
Commenting about what happened was one of the opponents to the bill (named Sherwin Siy) who said, "The language is still broad, allowing the DOJ or copyright holders to take court actions targeting any foreign websites that enable or facilitate copyright infringement. The bill does not define what enabling or facilitating infringement means, and could include ISPs, Web hosting services, or any site that links to a suspected infringer. In addition, the bills allow copyright holders to seek court orders requiring online advertising networks and payment processors to stop doing business with accused infringers. The legal actions from copyright holders are an incredible amount of power that somebody can have over a website." (Gross, 2012) This is significant in showing how the opponents believed that SOPA will have an impact on: individual creativity and the basic freedoms everyone enjoys (by giving the government unprecedented power).
From an ethical point-of-view, this is going directly against the basic morals that America was founded upon (personal freedom). The fact that government can take away the ability of someone to view certain sites on the Internet is an abuse of this power. At the same time, this could create situations where the government could go after entire organizations that are helping to support any kind of illegal downloading websites (such as: search engines or payment processors). Once this takes place, is when these companies will be held accountable for the actions of select web sites. This goes against the basic principles of American law with everyone having the right to confront their accusers. The fact that government can make accusations and then engage in actions to punish them is in direct violation of the ideals of freedom.
However, from a business law point-of-view, this is hurting the recording industry. The reason why is because any kind of delays could lead to even more losses down the road. This is based on concerns about possible civil rights abuses that have not occurred. While it is ignoring case precedent, which is clear…