Expanded Piracy Fight Is Urged

Times Staff Writers

With piracy and copyright infringement now among the nation’s most intractable and costly crimes, a Justice Department task force has concluded that the federal government must vastly expand its investigative and prosecutorial efforts.

The task force report, compiled by a dozen high-level Justice Department officials during the last seven months, calls for an assault on intellectual property theft at all levels, ranging from solo operators to international crime rings that are costing U.S. businesses an estimated $250 billion a year.

Atty. Gen. John Ashcroft is scheduled to hold a news conference in Los Angeles today to discuss the recommendations detailed in the nearly 100-page report, a copy of which was provided to The Times. Ashcroft is expected to immediately authorize their implementation.

Among other things, the task force is calling for the creation of specialized units across the U.S. and for substantial increases in the number of prosecutors and FBI agents assigned to intellectual property theft and the sale of counterfeit products. One top Justice Department official said that under the recommendations, the number of prosecutors assigned full time to the problem would rise to 274 from 60.


Further, the task force is recommending that FBI agents and federal prosecutors be stationed in U.S. embassies in Hong Kong and Budapest, Hungary, regions seen as key manufacturing points for pirated goods. Justice Department officials also should work with the State Department to make copyright theft a priority in negotiating extradition treaties with foreign countries, according to the report.

“This initiative is the most ambitious, aggressive crackdown on intellectual property theft in history,” said David Israelite, chairman of the Task Force on Intellectual Property and deputy chief of staff at the Justice Department.

Most of the prosecutors assigned to the intellectual property units would come from the Justice Department’s Washington headquarters, a top Justice Department official said. If approved, such a commitment of personnel would make the enforcement of intellectual property theft a priority rivaling federal efforts to combat drug smuggling.

Los Angeles was chosen for Ashcroft to unveil the report’s recommendations because of the large number of counterfeit goods smuggled in and out of the ports of Los Angeles and Long Beach. What’s more, the U.S. attorney’s office in Los Angeles has handled the bulk of intellectual property cases, mostly involving entertainment-related piracy.


According to the report, the theft of intellectual property is not only a threat to the nation’s economy but, in certain cases, also a danger to consumers.

The authors said there was mounting evidence that counterfeit drugs had caused illness and even death. According to the World Health Organization, such fakes account for 8% to 10% of all pharmaceuticals worldwide. Counterfeit cellphone batteries, meanwhile, have been reported to cause fires and injuries.

Although the Justice Department task force stopped short of explicitly backing or opposing any legislation pending in Congress, it made its sentiments clear on three controversial efforts to modify federal copyright law, siding with the entertainment industry.

The top priority for Hollywood studios and major record companies has been the so-called Induce Act, which would attempt to outlaw file-sharing companies that depend on piracy for their livelihood. The bill, stalled in the Senate Judiciary Committee, is fiercely opposed by an array of technology, consumer-electronics and communications companies and public interest groups. They contend that the legislation essentially would give the entertainment industry veto power over new technologies.

But the task force’s report called unauthorized file-sharing networks “some of the most dangerous threats to copyright ownership today,” adding: “A copyright owner should have some express remedy against such networks and other businesses, to the extent that they depend upon and intend for their customers to violate the owner’s copyright.”

The task force also said Congress should make it a federal crime to share large amounts of copyrighted works on one of these networks. That’s similar to a proposal in the so-called Pirate Act, which passed the House and is pending in the Senate.

Opponents, including several consumer advocacy groups, fear that such a move would expose file sharers to prosecution even if nothing was downloaded from their computers.

Finally, the task force said federal prosecutors should target those who circumvent the electronic locks on movies and other copyrighted works. Consumer-electronics and public interest groups have thrown their support behind a bill to allow unlocking for “fair use” purposes, such as making a backup copy of a DVD, but the legislation has stalled amid stiff opposition from the studios, record companies and software manufacturers.