In a major overhaul of existing copyright law, a bi-partisan House overwhelmingly approved a bill that calls for stiffer copyright infringement penalties, a new copyright czar, and an enhanced US Department of Justice IP enforcement apparatus.

The legislation is called Prioritizing Resources and Organization for Intellectual Property Act (PRO IP). And its recent overwhelming approval in the US House of Representatives brought applause from members of the intellectual property industry, although no welcome mat was extended by Justice Department officials and doubts lingered as to whether President Bush would actually sign it into law.

Jointly sponsored by Democratic Representatives John Conyers of Michigan and Howard Berman of California, as well as Republican Lamar Smith of Texas, the sweeping 69-page PRO IP Act overhauls existing copyright law in three important ways:

Stiffer penalties for copyright infringers, including:

• Maximum – and easier to obtain – penalties for repeat copyright offenders. Current law states that anyone who “willfully” infringes a copyright by distributing over $1,000 worth of material (including over a P2P network) is a criminal. The PRO IP Act, while maintaining the 10-year prison term for repeat offenders, now takes away the requirement that repeat felons must have distributed at least 10 copyrighted works within 180 days.
• Seizure and auction by the Justice Department of any computer or network hardware used to enable a copyright crime. In this civil asset forfeiture, the owner does not have to be found guilty of a crime for his property to be confiscated. The proceeds of the auction will go to the Department’s budget.
• Treble damages in counterfeiting cases. In determining damages in a case involving the use of a counterfeit mark or designation, the court (barring extenuating circumstances) will “enter judgment for three times such profits or damages, whichever amount is greater…”

Upon passing the bill, the House Judiciary Committee’s subcommittee on Courts, the Internet and Intellectual Property killed its most controversial amendment – which would have increased the fines for compilation CDs containing pirated music by 10 times or more. This means fines for a 10-song compilation CD would have ranged from $7,500 to $1.5 million rather than the current $750 to $150,000.

A new federal bureaucracy headed by a copyright czar.

The new bill calls for the establishment of the Office of the United States Intellectual Property Enforcement Representative, which would coordinate and strategize the federal effort against counterfeiting and piracy. The new agency head will be appointed by the president, confirmed by the Senate, and bear the exalted rank of Ambassador Extraordinary and Plenipotentiary. His or her charge: to be the president’s main advisor on intellectual property matters, develop a Joint Strategic Plan, and oversee intellectual property attaches in embassies abroad.

Restructure of Department of Justice IP functions.

The revamping will include the establishment of the “Intellectual Property Enforcement Division” headed by an Intellectual Property Enforcement Officer who will coordinate all DOJ efforts in this regard. The new team will also assume the IP rights enforcement functions of the Computer Crime and IP section of the DOJ’s Criminal Division. Plus, local law enforcement agencies will be given grants to help fight copyright infringement.

According to MPAA chairman, Dan Glickman, “We applaud the members of the House of Representatives for passing the PRO IP Act…a comprehensive, bi-partisan measure that will strengthen our nation’s economy and generate more jobs…by bolstering protections for intellectual property…” He added, “…the PRO IP Act is welcomed by both the business and labor communities because it can improve our nation’s economic outlook…”

A staff attorney at the Electronic Frontier Foundation was not as enthused, saying that the Department of Justice has said more than once that it doesn’t need this new office and additional help. She also indicated that the additional tax dollars would be better spent elsewhere.

Although the House passing of the PRO IP Act is definitely good news for brand and content owners, the celebration has to wait until the Senate takes up its version of the bill and the president finally signs this comprehensive bill.