Subcommittee approves database protection bill

A U.S. House subcommittee has approved a bill intended to prevent information stored in databases from being copied by rival companies and used to offer competing products.

The House Judiciary Committee's Subcommittee on Courts, the Internet and Intellectual Property voted Thursday to approve the Database and Collections of Information Misappropriation Act of 2003, over objections from Democrats that the bill would allow owners of databases to secure copyright-like protections on facts within databases, not just proprietary information.

Several other laws on the books, including contract and copyright laws, protect companies in almost all cases where information in databases is stolen, said Representative Rick Boucher, a Virginia Democrat. "This is the classic solution in search of a problem."

In late September, opponents of the legislation, including the U.S. Chamber of Commerce, raised some of the same objections.  But Lamar Smith, a Texas Republican who is chairman of the subcommittee, repeated Wednesday the reasons backers want the bill, saying current copyright law has inadequate protections for databases.

"Databases require substantial investments of time, personnel and money," Smith said. "Information companies must dedicate resources to gathering and verifying factual material, presenting it in a user-friendly way, and keeping it current. In cyberspace, technological developments represent a threat as well as an opportunity for collections of information. Digitally copying factual material from a third party's collection, and using it to form a competing information product is cheaper and easier than ever."

Smith offered an amendment to the bill intended to exempt nonprofit universities and research institutions from liability. The bill allows companies who've had their databases stolen to sue in civil court, with penalties of up to two times the actual damages.

But compromises in the legislation, which members of the House have been attempting to pass for about eight years, have weakened the bill from providing copyright-like protections for databases to protecting only against misappropriations of databases, said Representative Howard Berman, a California Democrat. "It's a pale shadow of its former self," Berman said of this year's bill.

Boucher offered four other amendments to the bill, which were either voted down or withdrawn. One would have exempted libraries from penalties in the bill, but that amendment was rejected by the committee. A second Boucher amendment would have prevented database owners from using the bill to protect legal materials produced by federal courts or any legislative materials.

"These are documents prepared for the public at the public's expense," Boucher said.

That amendment also failed after Smith objected to it, and Boucher withdrew another amendment that would have exempted Internet service providers and other telecommunications companies from being sued because misappropriated information was transmitted over their networks. Republicans on the committee agreed to work with Boucher on that provision before the full House Judiciary Committee debated the bill.