Beware of Stealth Clauses to Laws

Opinion: Be on the lookout, columnist Chris Nolan warns, for a favorite congressional trick: slipping in additions to bills right before approval.

When Congress returns to Washington after Labor Day the stage will be set for all sorts of legislative shenanigans, the late-night, smoked-filled, back-room deal-making sessions everyone denounces but, make no mistake, just as many participate.

One favorite trick: inserting clauses into large "omnibus" legislative packages, budgets or other financial bills that need approval to keep the government functioning. Additions, often a single line referring—obscurely—to a particular law, slip in as bills are proofread, revised and amended to suit Congress.

At least one person working on behalf of Silicon Valley thinks if stock option legislation wins approval this year, it will be as part of a larger package. Although it has passed the House of Representatives, resistance to the idea is quite strong in the U.S. Senate. For many in tech, the passage of legislation keeping stock options from being treated as expenses would be good news.

But what congressional sleight-of-hand gives it can also take away. Working in an unusually heated partisan atmosphere and the usual end-of-session rush to tie up loose ends, and you have the makings for a little mischief. Throw in the uncertainty that comes with an election year, and everything ratchets up a notch.

So many are worried that the tech industrys long-standing war with the recording industry and Hollywood might end during a late-night session while no one is watching. The recent court ruling that file-sharing technologies like Grokster and Morpheus arent illegal could encourage the industry association to push Congress to act.

"There are all sorts of technical maneuvering that can go on," says Gigi Sohn, president of Public Knowledge, a Washington organization that lobbies on high-tech consumer issues related to copyright.

Copyright is a bit more obscure than the legislative proposals concerning stock options. But it can generate quite a lot of heat. The two industries most affected—Hollywood and its stepsister, the music business—are known and loved in Hollywood. Their lobbyists at the Motion Picture Association of America and the Recoding Industry Association of America, along with the large corporations they represent, pull out all the stops when it comes to protecting their interests.

That, say critics, is exactly how a little bit of proposed legislation—the Induce Act—came into existence. Induce, more formally known as S. 2560, would enact stiff penalties for those found guilty of intentionally encouraging someone to violate a copyright. The law is aimed directly at those who create file-sharing software.

Some in Washington say the Induce Act is a response to a bill submitted at the beginning of the year by Rep. Rick Boucher, D-Va. Boucher introduced H.R. 107, the Digital Media Consumers Rights Act, at the beginning of the year. The legislation, Boucher said last week when he appeared briefly on Stanford Professor Larry Lessigs blog, is an attempt to roll back some of the restrictions Lessig and others say unfairly restrict rights to use copyrighted work. Bouchers bill calls for copyright violators to be found in violation of the law only if they intend to thwart copyright restrictions.

For much of the summer, observers have been predicting that this years maneuvering is being done with an eye toward next years action. Thats what Boucher says he expects to happen. But given the court decision, Washingtons heated political climate and the changing of the guard that comes with the end of a congressional session, many are saying that tech interests should be especially alert.

"We would be foolish to let down our guard," says Sohn.

Bouchers bill, like the Senate legislation, hasnt headed to the floor. And that worries many of those watching the action. Because the Senate appears poised to act. Senate sponsors—who include senators Patrick Leahy, Barbara Boxer and Minority Leader Tom Daschle—have asked the U.S. Copyright Office to evaluate the proposals included in the Induce Act. A report from the office is due Sept. 7.

"That doesnt sound like somebody who wants to tee something up for next year," says Sohn.


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