it was first offered for sale. The obvious question, in this era of electronic databases which are constantly updated with new information which would qualify for protection, is how will one determine what is 15 years old and therefore freely useable? We understand that there was some discussion last year of creating a deposit system within the Copyright Office. We believe that such a solution could be the answer, provided that a practical system could be developed that would not be unduly expensive or burdensome for database creators or users.

CONCLUSION

Mr. Chairman, the evolution of the legislation to fill the void left by the Feist decision has taken us ever closer to our goal. With H.R. 354, the AIPLA believes that we are indeed very near the balanced approach needed to reestablish the incentives for continued American leadership in the field while addressing the legitimate needs of users. We are ready to work with you and with other interested individuals and organizations to resolve any remaining issues to facilitate the prompt enactment of this important and needed legislation.

Mr. COBLE. Thank you, Mr. Kirk.
Mr. Phelps.

STATEMENT OF CHARLES PHELPS, PROVOST, UNIVERSITY OF ROCHESTER

Mr. PHELPS. Thank you, Mr. Chairman, members of the subcommittee. I appreciate this opportunity to present the views of three major higher education associations on H.R. 354.

First, I want to thank you for your responsiveness to our previous concerns. You've made a number of changes in your bills over the last year and H.R. 354 contains further improvements in accepted uses for university research and educational purposes. We acknowledge and thank you for your responsiveness. Therefore, at the risk of seeming ungrateful, I must state that we believe that more work needs to be and yet can be done expeditiously.

A single core principle directs our thinking on database use and protection: the preservation of access to facts as a part of the public domain for use by all. Our longstanding national information policy has fostered the unfettered flow of information for research and education and has served this Nation well.

As the Supreme Court said in Feist, "all facts-scientific, historical, biographical, and news of the day... are part of the public domain available to every person." "The raw facts and the compilation may be copied at will. This result is neither unfair nor unfortunate. It is the means by which copyright advances the progress of science and art."

The U.S. leads the world in science and technology. The Nation benefits economically, militarily and in the quality of life and the products of economic research and advanced education.

Moreover, the higher education enterprise itself is one of the most successful sectors of the economy. The quality of U.S. higher education has attracted far more students from abroad than has that of any other country in the world. Perhaps only professional basketball has succeeded more in international competition than higher education. We should not put that success at risk.

Given the importance of our national research and educational enterprise and the role that our enlightened national information policy plays in sustaining the creativity and productivity of this enterprise we believe Congress should always move to protect access to information and to preserve the ability of science, scholars and

educators to use information to advance their research and education missions. If in doubt, you should err on the side of access. To preserve access to information we believe that the database protection legislation should meet three critical standards. First, the protection should only target specifically identified wrongful conduct rather than establishing a broad prohibition against use. Second, protection should apply only to clearly defined classes of materials, to compilations and not the facts they comprise. And third, the protection available for compilations in this domain should not exceed that now provided for original creative works of authorship through copyright law.

We believe that H.R. 354 does not yet meet these standards. Our specific concerns are the following: first, the prohibition on extraction or use in commerce is unreasonably broad and grants substantial control over information itself long after it is extracted from the protected collection. The term "use" has no meaningful bound and could cover virtually any academic conduct involving the information.

At each step of the way in using information a professor or student will be required to know the origins of and the investment in the information, whether it represents a quantitatively or qualitatively substantial part of the collection, whether the specific use is licensed and whether the use harms a market. While there might be enough attorneys to guide us through this legal maze as we carry out our academic work, we could not afford them.

I have seen Ms. Winokur's written statement on behalf of the Coalition Against Database Piracy and agree with her that the real threat to the database industry are unscrupulous competitors and cyber-pranksters, but I do not believe you need H.R. 354 in its current form to address those threats. I believe you need only a focused bill perhaps making extracted material available to others in a manner that is likely to serve as a market substitute for the original collection.

Second, the definition of "protected collection" is so broad that it literally covers almost any academic publication, including and article, a textbook, or a report in a scientific study with its accompanying data. It should be narrowed in the text of the bill. I understand from the written statements that the Copyright Office agrees with this goal. We do disagree with the Office's belief that the language in the bill now accomplishes that and my written testimony does provide alternative approaches.

Third, liability under H.R. 354 should not be triggered where a taking is either quantitatively or qualitatively insubstantial. The essence of compilation is quantity. If you protect the quantitatively insubstantial you protect the facts themselves. A single fact or several are just facts, no matter how important. In order for liability to attach, the taking must be quantitatively substantial. Further, the material that is taken must itself be the result of substantial effort and investment that the bill protects.

Fourth, the bill's concept of market harm far exceeds the traditional bounds of misappropriation and unfair competition law and provides database proprietors with the ability to define markets and thus liability. Harm should focus on the dissemination of a

market substitute. If extraction is prohibited it should be limited to extraction that causes substantial harm to the primary market. Fifth, the bill's exceptions for educational activities and other reasonable uses contain conditions that substantially restrict their usefulness. For example, the non-profit academic exception is conditioned on the absence of "direct harm to the actual market." That sounds fair until you realize that direct harm means non-payment of the fee and "from actual market" can be anything that the proprietor wants. That is far from the result the Copyright Office says is appropriate, to quote: "Where such use is a serious and immediate threat to the producer's investment." And the user is a member of the market for which the database is produced.

Sixth, the bill fails to protect the public against unreasonable market power from compilations not readily available from competitive sources and fails to secure access to older, no longer protected versions of protected compilations. This could lead to a death trap of perpetual protection. Again, I understand that the Copyright Office agrees that further work on these issues may be needed.

The bill also does not protect for institutions that act as on line service providers from unreasonable liability for the conduct of third parties. And all universities and colleges serve this function for their community.

My written statement amplifies these concerns and proposes specific solutions. When you consider the threat that overly broad protection poses to the foundation of the scientific, academic and research communities we hope you will give our proposals full consideration. We'd be most happy to work with you to clarify the language.

Thank you.

[The complete statement of Mr. Phelps follows.]

PREPARED STATEMENT OF CHARLES PHELPS, PROVOST, UNIVERSITY OF ROCHESTER

I am Charles E. Phelps, Provost of the University of Rochester. I appreciate this opportunity to testify before the Subcommittee on H.R. 354, "The Collections of Information Antipiracy Act." My testimony is presented on behalf of the Association of American Universities, the American Council on Education, and the National Association of State Universities and Land-Grant Colleges, which together represent over 1,500 colleges and universities. These Associations understand the need to protect databases, and they support legislation targeted to address unfair competition and database piracy. Indeed, universities and colleges often are creators of collections of information.

We very much appreciate the revisions to H.R. 2652 contained in H.R. 354 that seek to address concerns raised about acceptable uses of databases and the potential for perpetual protection of databases. We are concerned, however, that the protections provided to collections of information in H.R. 354 remain overly broad in a number of key respects that will impede the core academic activities of research and teaching. We are prepared to work with the Subcommittee and with other interested parties to develop a consensus approach that can be supported by all.

We approach the issue of database protection with a single core principle: Because data and information are the cornerstone of scientific and scholarly research, teaching and learning, we believe it is imperative to preserve the fundamental premise of this nation's information policy that no one may own facts or information, or may prevent the full, unfettered use of facts and information. As the Supreme Court said in Feist, "all facts-scientific, historical, biographical, and news of the day. part of the public domain available to every person." Feist Pubs., Inc. v. Rural Telephone Service Co., 499 U.S. 340, 348 (1991), quoting Miller v. Universal City Studios, Inc., 650 F.2d 1365, 1368 (5th Cir. 1981). “[T]he raw facts [in a compilation] may be copied at will. This result is neither unfair nor unfortunate. It is the means

are

by which copyright advances the progress of science and art." 499 U.S. 340, 350 (1991).

This policy has served the country well. The United States stands at the forefront of learning, science and technological achievement, and the nation has benefited richly from this leadership in international economic competitiveness, lifesaving advances in medicine and health care, technological superiority in defense, and an enriched quality of life for our citizens. We believe that the enlightened information policies of this nation have played a significant role in sustaining the creativity and productivity of the research and education programs that led to these benefits. Congress should avoid any legislation that could threaten this fundamental principle that facts and information remain in the public domain. Educators and researchers should not be required to have an attorney on call at all times. Wherever decisions are to be made about the proper scope of protection for compilations of information, Congress should err on the side of caution and access to information.

Based on this principle, we can identify several critical standards that any legislation to protect compilations of information should meet: First, protection should be targeted to deal with specifically identified wrongful conduct. Second, protection should be addressed to a clearly defined class of materials and should be limited to compilations as compilations, not the facts or the information per se. Third, the protection available for compilations of information should be no broader, or stronger, than the protection available for original, creative works of authorship.

Regrettably, H.R. 354 fails to meet these standards. We do not lightly conclude that, as written, H.R. 354 threatens to chill research and education and to place information in the control of a limited number of commercial interests. But we do conclude that we cannot support H.R. 354 in its current form.

Our three associations and their member colleges and universities have the following specific concerns.

• H.R. 354's prohibition on "extraction or use in commerce" is unreasonably broad and grants substantial control over information itself, long after it is extracted from a protected collection. The bill should focus its prohibition on one who makes extracted material available to others in a manner that is likely to serve as a market substitute for the original collection. Certain extraction may also be prohibited.

• The definition of a protected collection is so broad that it literally covers almost any publication, including an article, a textbook, or the report of a scientific study (with accompanying data). It should be narrowed in the text of the bill.

• Liability under H.R. 354 should not be triggered where a taking is quantitatively or qualitatively insubstantial or where the portion that is taken was not the subject of substantial investment.

• The bill's concept of "market harm" far exceeds the traditional bounds of misappropriation and unfair competition law and provides database proprietors with the ability to create markets, and thus, liability.

• The exception for non-profit educational activities contains a broad, vague condition that vitiates its protection.

• The exception for other reasonable uses is insufficiently flexible, and contains conditions that greatly limit its benefit.

• The bill fails to protect the public against unreasonable market power from compilations that are not readily available from competitive sources.

• The bill should secure access to older versions of protected compilations, in order to prevent perpetual protection.

• The bill does not protect institutions that act as online service providers from unreasonable liability.

• The bill lacks clear exemptions from liability for non-profit teaching activities, akin to the exemptions in Copyright Act section 110.

In the following statement, the Higher Education Associations provide an overview of the basic academic activities that are threatened by H.R. 354. We then amplify the three standards we have identified. Finally, we discuss our specific concerns with the bill and offer suggestions for improving the legislation. It is important to stress that these suggestions are not presented as a menu from which a few items may be chosen. We believe that each of the fundamental issues discussed below should be addressed in order to preserve the flow of information and the progress of science and learning.

I. THE ACADEMIC ENVIRONMENT AND ACTIVITIES THREATENED BY H.R. 354

The research and teaching missions of colleges and universities are fundamentally tied to information and the translation of information into knowledge: through the production, analysis, verification, interpretation, and dissemination of information, scientists and scholars expand the frontiers of knowledge and transmit that everexpanding knowledge to colleagues and to students. The results of research are publicly disseminated through articles, books, workshops, conferences, and increasingly through digital networks as well. Research results so disseminated are used by other scientists and scholars-to build on, to critique, to re-examine and re-interpret. Through the give and take over what may be initially conflicting data or interpretations of data, new phenomena are understood and verified, and knowledge is advanced.

The process of translating data into knowledge requires the open exchange of information among allied scholars and critics alike. Increasingly, research is conducted in teams, often from several institutions. Data are drawn from multiple sources, recombined and merged with new data to produce data sets that may lead to new and unanticipated findings. Data sets vary from the results of a single experiment, captured in a table in a single journal article, to the vast databases of information compiled from meteorological remote sensing instruments, geographic information systems, particle accelerators, and systematic aggregations of research results to produce databases of genomic, chemical, and medical information, and much

more.

Databases supporting research and scholarship are not limited to the sciences. Databases supporting work in the humanities and social sciences are proving increasingly essential to advancing knowledge in these disciplines; specialized dictionaries, annotated bibliographies of worldwide research resources, census information, and compilations of text citations are just a few of the systematic compilations of information critical to humanistic and social science research.

In the academic community, these databases are dynamic instruments: they are not only sources of information, but they themselves-or components of them-become ingredients in new products, both through the combination of multiple contemporaneous data sets to produce qualitatively new products, and through the re-analysis of prior data from new perspectives provided by new findings or new analytic tools. A scientist may apply a formula developed from his or her research to a different set of data, yielding a different interpretation of that data; multidisciplinary researchers may combine components of databases from physical, biological, chemical, and meteorological data to understand the dynamics of ecological systems; social scientists may combine elements of databases of demographic, economic, legal, and political information in comparative analyses of national or regional populations worldwide.

Some of the best education is learning by doing and by discovering, and students are increasingly using databases to draw their own conclusions, duplicating the research process to learn through discovery under the guidance of faculty.

For all of these research and educational activities, faculty and students must be able to have open and easy access to compilations of data of all sizes, from single research results to large databases, and they must be able to work with these compilations-extracting, combining, and aggregating sets of data-to advance the frontiers of knowledge and educate students about those advances.

These academic uses of information do not require that all information be free; indeed, universities now pay substantial sums for commercial databases. But these uses do require sufficiently flexible conditions of use, conditions that can be stultified by a proprietary protection scheme that makes use, reuse, and recombination difficult and militates against the ability to exchange information with colleagues and students.

II. THE STANDARDS AGAINST WHICH LEGISLATION TO PROTECT COMPILATIONS SHOULD BE JUDGED

In general, the Associations share the view of the Administration, as expressed last year by the Department of Commerce, that "any [law to protect compilations and databases] should be predictable, simple, minimal, transparent, and based on rough consensus." Letter from Andrew J. Pincus, General Counsel, Department of Commerce, to Senator Patrick J. Leahy, August 4, 1998 (the "Pincus Letter”). In particular, we emphasize three important criteria.

First, the protection should be targeted to deal with specifically identified wrongful conduct. We respectfully believe that it is not good policy to adopt a broad, catchall prohibition, which is subject to potentially broad but ambiguous exceptions that are subject to judicial construction and application. Such an approach will ensure