User Generated Content Sites

– Formula for Profit, or Recipe for Disaster?

By: Lawrence G. Walters, Esq.

Weston, Garrou, DeWitt & Walters www.FirstAmendment.com

Given the smashing success of YouTube™ and other video-sharing websites, it was inevitable that the adult industry would see a surge of similar business models involving adult material. Adult dating sites, ex-girlfriend sites, ‘tube’ sites, freak sites, community sites – you name it, and users are posting it. This online business method seems to be the latest rage in the industry, with about half of our firm’s clients looking to sue an adult tube site and the other half looking to open one. A major lawsuit has already been filed against the operators of PornoTube.com by powerhouse studio producer, Vivid Entertainment, asserting some interesting

claims, including a novel take on the legal effect of § 2257 non-compliance.¹

Given the viral spread of this new business and entertainment model, it is important to examine the legal risks associated with operating a user generated adult content website, and consider whether the legal risks outweigh the potential rewards. This article will delve into the varied legal concerns associated with online erotic video-sharing. As with all legal issues, an article is no substitute for competent legal advice. Before considering the operation of a user generated adult content site, it is essential to consult with an experienced adult industry attorney.

Section 2257 Issues

An obvious place to begin the discussion is with the complicated and nuanced issue of Section 2257 compliance. User generated website content is not, strictly speaking, produced by

¹ Vivid Entertainment LLC v. Data Conversions, Inc. et al, Case No. 2:2007cv08023 (C.D. Ca. Dec. 10, 2007), wherein the Plaintiff claims that Pornotube.com’s failure to comply with § 2257 results in unfair competition, with respect to all the other websites that are required to comply.

the operator. Rather, it is provided by the site’s users, who may, or may not, have created the content. Everything from erotic spousal activity, to shocking body modifications, to hidden bathroom cams, and even clips from unreleased, professionally-produced adult films, may appear on a typical user generated, adult content site. Most of this content is posted automatically to the

website for immediate viewing by the site’s users, without prior screening or approval by the webmaster.² Naturally, the following question comes to mind: Does the operator of such a website need to comply with either the records keeping or labeling requirements of Title 18,

3. § 2257?

As with most 2257 records keeping questions, the issue of compliance comes down to whether the business operation in question “produces” the actual sexually-explicit content. For purposes of this discussion, the term “produces,” as defined in Title 18, U.S.C. § 2257(h)(1)(2)(a), includes:

digitizing an image, of a visual depiction of sexually-explicit conduct; or, assembling, manufacturing, publishing, duplicating, reproducing, or reissuing a…digital image…[and],

inserting on a computer site or service a digital image of, or otherwise managing the sexually-explicit content, of a computer site or service that contains a visual depiction of, sexually-explicit conduct.

The term “produces” does not include activities that are limited to:

…digitization of previously existing visual depictions, as part of a commercial enterprise, with no other commercial interest in the sexually-explicit material

* * *

Distribution

* * *

² Sometimes all of the content is pre-screened by the operator; however this practice may impact some of the legal issues, as discussed below.

[or]

the transmission, storage, retrieval, hosting, formatting…of a communication, without selection or alteration of the content of the communication, except that deletion of a particular communication or material made by another person in a manner consistent with 230(c) of the Communications Act of 1934 (47 U.S.C. § 230(c)) shall not constitute such selection or alteration of the content of the communication.

Therefore, the relevant consideration comes down to whether the operation of a video- sharing site constitutes digitization of an image, assembly of an image, publication of an image, or managing the sexually-explicit content of a computer site on the one hand; or whether such operation will be considered digitization of a previously-existing visual depiction, mere distribution of the content, or the transmission, storage, retrieval, hosting, or formatting of a communication, on the other hand. Thus far, the courts have not addressed whether the current definitions of compliance-triggering activities, contained in § 2257, apply to the operation of a user generated content website.

In light of the Sixth Circuit’s decision striking down § 2257³, records keeping compliance

issues have taken somewhat of a back seat to other legal concerns, given the widespread industry perception that neither 2257 inspections nor prosecutions will occur until the constitutional issues are sorted out in court. Notwithstanding the accuracy or inaccuracy of this perception, the lull in 2257 activity has provided a unique opportunity for proliferation of user generated content sites.⁴

³ Connection Distributing Co. v. Keisler, 505 F.3d 545 (6th Cir. 2007).

⁴ It should be noted, however, that failure to comply with 2257 requirements could result in civil claims based on

unfair competition, as have been asserted in the lawsuit by Vivid Entertainment against Pornotube.com. See Vivid Entertainment LLC, supra.

The trial court’s decision in the above-referenced case involving Connection Distributing⁵ held that the operation of a “swingers” classified website, which allowed users to post sexually-explicit images of themselves on profile pages, did not require records keeping compliance so long as the website operator did not control the areas of the site where the users posted the 2257 triggering content.⁶ While this decision was ultimately superseded by the Sixth Circuit Court of Appeal’s opinion declaring § 2257 unconstitutional on it face, the trial court’s opinion provides some insight into how this issue might be interpreted by the courts.

The mechanics of the content submission process can significantly impact whether a video-sharing site is exposed to § 2257 compliance burdens. While a final determination whether to comply rests with the site’s operator, in consultation with the its attorney, the following factors might be considered in making this important decision:

1. Whether the content is reviewed and approved by the operator prior to its appearing on the site, or whether it is posted automatically (or some combination thereof);

2. Whether specific categories of content are solicited for, or permitted on, the site, or whether all content types are accepted;

3. Whether any content subjects or categories are deleted after posting, and how decisions relating to deletion of content are made;

4. Whether users are restricted in the manner in which content is submitted; i.e., whether profiles or restrictive forms are used, or whether content can be provided in a free form manner;

5. Whether the site is promoted as featuring specific subjects, or is more general interest in erotic fare;

⁵ Connection Distributing Co. v. Gonzalez, Case No. 1:95CV1993 (N.D. Oh. 2006).

⁶ The case did not decide whether the “labeling” obligations were triggered by this activity, however.

6. Whether any ‘seed’ content is included by the operator, and the impact of this content on the ultimate nature of the content submitted by users.

Generally, the less control the operator has over the posting of content by the user, the less likely the site will need to comply with 2257. However, this lack of control comes with a price, since the site operator will therefore be unable to prevent potentially illegal images or video from appearing – even temporarily – on the site. This heightens some of the other legal concerns such as child pornography, obscenity, or copyright infringement, as discussed below.

Even if the webmaster’s activities do not fall within the definition of “produces” in the Statute, so as to trigger records keeping obligations, they may meet the definition of the term “distribution.” While distributors are not subjected to records keeping obligations under the Statute, they are required to ensure that a proper “label” appears on the 2257-triggering content. From the standpoint of a user generated content website, this means that the webmaster would need to ensure that each depiction of actual sexually-explicit conduct is accompanied by a proper 2257 disclosure statement, identifying the full name and physical address of the records custodian along with the date and title of the work. Given the natural hesitation of many amateur content producers to provide information about themselves when posting sexually-explicit materials, non-compliance by users is virtually guaranteed if webmasters are considered distributors. The labeling issue therefore presents a significant concern.

The legal validity of § 2257 is far from over, since the Government is seeking further judicial review of the Sixth Circuit’s opinion. Thus, it is too early to discount the potential impact of 2257 on user generated content sites. The courts could reinstate the current version of 2257 by subsequent decision, or Congress could act to correct the constitutional concerns noted by the court. While passing new laws may lead to new challenges, it bears noting that the

appellate court’s decision in the Connection Distribution case came after more than 12 years of litigation and repeated constitutional challenges. Given the prevalent attitude hostility towards the adult industry that currently exists in Washington D.C., it is likely that some sort of performer age verification law will be on the books for years to come.

With respect to the current Statute, there are valid arguments on both sides with respect to its applicability to user generated content. On the one hand, website operators often act to digitize images hosted on user generated sites – even if the process is automated. Erotic images are “inserted” on these user generated content sites by both the user and the operator, and webmasters have some role in “managing” the content of the website — if only to “assemble” or “arrange” the categories or profiles.

On the other hand, the visual depictions posted to the site are “previously existing” and usually not created by the operator. Moreover, the webmaster’s activities may well be limited to activities like “transmission, storage, retrieval, hosting, and/or formatting” of the preexisting images, so as to fall within the plain meaning of the records-keeping exemption language. Notwithstanding the above, it remains an open question whether website transmission constitutes ‘distribution’ within the meaning of Section 2257. If so, labeling is required, at a minimum. Obviously, risks of non-compliance exist. Therefore, a decision can only be intelligently made in consultation with an adult industry lawyer, and must be based on the operator’s unique risk tolerance level.

Obscenity & Child Pornography

One of the strengths of the user generated content business model is the fact that the webmaster need not purchase or create content – instead it comes free of charge from the users. This strength is also one of the business model’s great weaknesses.

Since the content comes directly from users, the webmaster has no opportunity to make decisions as to what kind of content will appear on the site in question. While other adult website operators only purchase or create content that falls within their own risk tolerance levels, user generated content can (and often does) depict just about anything under the sun. This includes content that might be considered obscene or – worse yet – child pornography.

With respect to obscenity, the inability to review and approve each image or video clip before it is posted to the website means that some content, that the webmaster may not like, ends up on the website – at least for some period of time. The operator can delete the content – either in response to user complaints or its own review process – without losing any exemption that would otherwise be applicable, pursuant to § 2257(h)(b)(V).⁷ However, removing the content

after it has been posted does not change the fact that it may have appeared on the website at one

time, and may have been viewed or downloaded by claimants or government agents. One obvious answer is to review and authorize all content before it goes live to the website. In theory, this is a good option, but it has both legal and practical drawbacks. Initially, as a site’s popularity increases, so does the amount of content posted to it at any given time. The manpower necessary to review each second of every video clip or every image posted to the website may be cost-prohibitive. Moreover, the decision to review all content ahead of time may impact the viability of any claimed exemption under § 2257, as well as the immunity from civil suits provided by § 230 of the Communications Decency Act (discussed later). Pre-selection of acceptable content may well put the webmaster in the position of “assembling” or “managing” the sexually-explicit content, and thus trigger § 2257 obligations. The impact on these legal issues of any particular posting policy should be properly evaluated by the operator and the legal

⁷ Some deletion policies may be so broad as to result in “management” or “assembly” of the content, so caution is urged when developing a deletion policy.

department. However, the foregoing helps illustrate the “Catch 22” facing many user generated content website operators, since both auto-post and content review policies come with associated legal pros and cons.

One of the key advantages of 2257 compliance is the almost automatic defense to child pornography claims. The child pornography issues associated with user generated content are serious. Given the lack of 2257 performer records, website operators will usually be in the position of being unable to prove the age of individuals depicted on their user generated content website. No records mean no proof of age and possibly no defense to child pornography charges.

Prosecutors in the federal system use something called the “Tanner Scale” to prosecute individuals for child pornography charges, particularly where the actual birth date of the individual depicted in the images is unknown. The Tanner Scale allows prosecutors to call a pediatrician to the stand to testify regarding such factors as breast development, presence/absence of pubic hair,⁸ and maturity of the inner thigh tissue, when reviewing images of

suspected child pornography, to make prognostications about the suspected age of the individual

depicted. Therefore, federal prosecutors need only secure the testimony of a friendly pediatrician “expert” who is willing to testify that the individual depicted on the user generated post appears to be approximately 16-17 years of age, based on these factors. While the operator may ultimately win his or her criminal trial on issues of reasonable doubt, etc., by that time most of the serious consequences of a child pornography prosecution have been experienced, and the victory is quite hollow. Therefore, child pornography risks constitute one of the major drawbacks of the user generated content business model.

⁸ Given current industry grooming trends, this factor is becoming increasingly irrelevant.

A strict review policy may be necessary to weed out any even arguable underage images, or obscene material, to avoid the serious consequences. However the details and mechanics of how such a policy is instituted, will affect other issues such as § 2257 compliance and § 230 immunity.

Copyright

User generated content sites are copyright minefields. Much of the material posted on both the mainstream and adult-oriented user generated sites is clearly infringing. Some of the larger content producers and website operators blame their declining revenues on the widespread availability of their stolen content on ‘tube’ sites. The adult industry has taken steps to combat this rampant piracy, and is organizing in an effort to present a unified front against these infringers. ⁹

While the posters of infringing content are directly liable for copyright infringement, they are often penniless individuals sitting in their basement playing on the Internet. Even the RIAA would pass on the opportunity to sue most of them. The only deep pocket here is the website operator. That leads to the following question: Can user generated content sites be sued for vicarious or indirect copyright infringement for allowing routine use of their services to display copyrighted material without a license? The answer to that vexing question will likely come from the courts in the case filed by Viacom Entertainment against YouTube.com.¹⁰ The legal

issues are thorny. Ordinarily, websites which merely allow others to post material online, without any other interest in, or selection of, the content of the material posted, can argue that they are protected by the ‘safe harbor’ provisions of the Digital Millennium Copyright Act

⁹ Bourne, Justin “‘Piracy Roundtable’ Offers Solutions From Producers,” AVNOnline.com (Jan. 16, 2008), which can be viewed at: http://www.avn.com/index.cfm?objectID=839050DA-AAC2-F716-33386ED5B50B24EC.

10. Viacom Int’l, Inc. v. YouTube, Inc., et al., Case No. 1:07-cv-02103-LLS (S.D. N.Y. March 13, 2007).

(DMCA).¹¹ If safe harbor applies, the site cannot be held liable for damages in a copyright case. Before DMCA safe harbor can be asserted, the website must take certain steps to perfect its status as a protected site, including designation of an agent for receipt of copyright notices, posting of a Notice and Takedown policy, and filing the proper forms with the U.S. Copyright Office. The website must also properly respond to any DMCA notices it receives, in order to maintain safe harbor protection. Repeat offenders must be terminated, or the site could lose its

safe harbor arguments.¹²

But, what if the website’s user-posting technology is routinely used as a device to disseminate infringing materials? Can copyright liability be imposed under those circumstances? A similar argument was made against the Sony Corporation in the days of the Betamax video recorders, by the mainstream movie studios.¹³ They alleged that this device’s primary purpose was to facilitate duplication of copyrighted movies and TV shows, and the company should

therefore be held liable. The Supreme Court disagreed, and concluded that the Betamax VCR had substantial non-infringing uses, such as making personal backup copies or playing home movies.

However, when the Courts considered the Napster¹⁴ and Grokster¹⁵ cases, involving the

downloading and copying of mp3 music files, the websites lost. In those cases, the Court found that the primary purpose of both systems was to infringe on copyrights, despite any lawful uses they might have had. In the Grokster case, the Court observed that the device was intentionally

10. Digital Millennium Copyright Act, 17 U.S.C. § 512. Notably, not all user generated websites will enjoy DMCA safe harbor, depending on their level of control over the content posted to the site. See: Fair Housing Council of San Fernando Valley v. Roommates.com, LLC, 489 F.3d 921 (9^th Cir. 2007).

¹² 17 U.S.C. §512(i)(1)(A).

¹³ Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984).

¹⁴ A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).

¹⁵ MGM Studios, Inc. v. Grokster, Ltd. 545 U.S. 913 (2005).

marketed to the public as a means to download and trade mainstream music files, which otherwise enjoyed copyright protection.¹⁶

The outcome of the Viacom case against Google’s Youtube.com site, will be governed by the legal principles established by Sony, Napster and Grokster. Good arguments can be made either way, and much will depend on the copyright policing and protections undertaken by Youtube.com. Accordingly, future cases may be dependent on the specific facts relating to the operating policies of the sites in question. To the extent that efforts are made to protect copyright holders’ rights, that will sit well with the courts when DMCA safe harbor is asserted. For now, operators of user generated content sites take a risk when allowing users to upload copyrighted material.

Trademark

The trademark issues are similar, but not identical to, the copyright issues. Trademark issues usually arise, in this context, when a trademark owner seeks to hold a website operator responsible for trademark infringement as a result of the webmaster’s involvement in display of the protected mark on the website. Where the webmaster intentionally uses content containing the trademarked word or phrase in a commercial manner, the liability issues are clearer. However, where the webmaster merely creates an online venue allowing third party users to post information without the operator’s prior review or approval, the liability for infringement is less certain. Unlike copyright claims, Congress has not created a safe harbor allowing website operators – or even true ISP’s – to avoid liability as exists with the DMCA notice procedure. Lawmakers apparently overlooked potential trademark liability when designing the DMCA safe harbor, thus creating something of a “no-man’s land” of liability when protected marks are improperly included in user generated content posts.

¹⁶ Id. at 913.

The author has defended hosts, and others, against trademark claims resulting from user generated, or customer generated, content. Concepts of fair use may come into play when the marks are not prominently featured in the content, or only a passing reference is made to them. However, some companies take an aggressive enforcement policy when it comes to any unauthorized display of their marks on websites, thus creating a potential liability concern for operators of user generated content sites. The law has not developed to the point of any type of certainty, thus far. Accordingly, liability resulting from unauthorized publication of protected trademarks on user generated content sites remains a potential area of concern for operators.

Online Agreements, Terms & Conditions

Some of the legal concerns referenced above can be mitigated substantially by proper implementation of a good set of User Terms & Conditions. Members authorized to post content to an adult-oriented website should be constrained by a specific set of policies governing the type of content that is acceptable, and the grounds for suspension/termination of the user’s account. It goes without saying that uploading of obscene and child pornographic material must be categorically prohibited by the website’s user agreement. However, the website operator may want to adopt more specific policies as to the type of sexual material that is authorized to be posted to the website. Some operators will restrict depictions of certain fetish practices or depictions of violence, mutilation, amputation, menstruation, bodily fluids, and other distasteful topics. Other operators will try to avoid § 2257 liability by prohibiting any content containing actual sexually-explicit conduct. None of these depictions will be considered obscene, automatically, since the obscenity determination depends on a number of factors, including the local community standards where the case is brought. Certainly, the website operator is free to exclude any type of material that the operator believes will pose an inordinate risk to his or her

business operation. However, care should be taken to avoid being so selective to result in a loss of § 230 immunity, loss of DMCA safe harbor, or imposition of § 2257 obligations, as discussed above. Once the site’s policies are adopted, they should be enforced consistently through a meticulous content review procedure. It does little good to adopt strong content posting guidelines which result in little or no actual enforcement activity.

The member terms for a user content website must also focus on taking advantage of the immunities provided by the Communications Decency Act,¹⁷ (“CDA”), and the DMCA safe harbor. Section 230 of the CDA provides immunity to certain websites against claims based on the content of messages created by third parties and posted on those websites. Websites protected by Section 230 will be immune from claims like defamation, negligence, infliction of emotional distress, false light, invasion of privacy, etc.¹⁸ The website operator is permitted to delete certain content posted by third parties from the website, which is believed to be obscene, indecent, defamatory, or otherwise illegal, without losing the immunity protection, under the so- called “Good Samaritan” provisions of the Statute. A well-written set of User Terms can outline

the nature of this protection, and advise all users of the existence of the immunity protection against claims. At the same time, the Terms can outline the site’s Good Samaritan removal policy. Relatedly, the Terms & Conditions should include a “Notice and Takedown Policy” referenced above, to protect the site’s DMCA compliance efforts. This policy must include the name and contact information for the website’s DMCA Agent, who is appointed to receive and process copyright infringement notices. Done correctly, the inclusion of this information can help protect against damages claims resulting from copyright infringement. Finally, the User

¹⁷ Communications Decency Act of 1996, 47 U.S.C. § 223

¹⁸ E.g., Doe v. American Online, 783 So.2d 1010 (Fla. 2001).

Terms should adopt some sort of age verification policy and procedure.¹⁹ Of course, user generated content sites need all of the other legal goodies like Privacy Policies, Age Verification, Affiliate Agreements, SPAM Policies, etc. Cutting edge legal documents are essential for all adult-oriented websites, but given the increased potential for legal claims arising out of the often uncontrollable content submitted by users, all forms of legal protection become even more important. Needless to say, user generated content website operators will be thankful for all the protection that legal agreements can offer, in the event a claim arises.

Conclusion

As can be seen by the foregoing, the legal issues associated with user generated content sites are numerous, unsettled, and interrelated. Given the relative recent popularity of this particular business model, little law exists to specifically guide operators or their lawyers. However, legal decisions involving similar websites can be consulted in an effort to predict how the law will develop. Thus far, online companies that merely provide a venue or system for others to communicate on the Internet are treated surprisingly favorably by the courts. Therefore, decisions relating to services such as hosts, ISPs, and chat rooms, have tended to come down on the side of the service provider. However, as webmasters blur the line between access provider and content provider, the courts will be forced to take a closer look at how far the law should go in imposing liability on the operator for content submitted by users. The more involvement that the operator has in the ultimate selection or arrangement of content displayed, or the manner in which it is displayed and promoted, the more likely that the operator will be subjected to the ordinary liability of a content provider. The outcome of the Viacom Entertainment and Vivid Entertainment cases will significantly impact the law in this area, as the first cases to interpret these cutting edge issues. Until then, operators should diligently educate

¹⁹ For an example of such a procedure, see, www.BirthDateVerifier.com.

themselves as to the potential legal concerns, and work with trained professionals in an effort to reduce liability to reasonably tolerable levels.

Lawrence G. Walters, Esquire, is a partner with the law firm of Weston, Garrou, DeWitt & Walters, with offices in Orlando, Los Angeles, Las Vegas, Salt Lake City, and San Diego. Mr. Walters represents clients involved in all aspects of the adult industry. The firm handles First Amendment cases nationwide, and has been involved in much of the significant Free Speech litigation before the United States Supreme Court over the last 45 years. All statements made in the above article are matters of opinion only, and should not be considered legal advice. Please consult your own attorney on specific legal matters. You can reach Lawrence Walters at Larry@LawrenceWalters.com, www.FirstAmendment.com or AOL Screen Name: “Webattorney.”

IN THE CIRCUIT COURT, FIRST JUDICIAL CIRCUIT IN AND FOR ESCAMBIA COUNTY, FLORIDA

STATE OF FLORIDA,

Plaintiff,

vs.

CLINTON R. McCOWEN,

Defendant.

/

CASE NO.: 2006-CF-003151-C

JUDGE: Allen

TABLE OF CONTENTS

Page

TABLE OF CONTENTS 2

TABLE OF AUTHORITIES 4

RELEVANT FACTS 10

ARGUMENT 12

I IN DETERMINING WHAT COMMUNITY STANDARDS TO APPLY IN OBSCENITY PROSECUTIONS, THE COURTS HAVE DISTINGUISHED BETWEEN TRADITIONAL ʺBRICK AND MORTARʺ PROSECUTIONS AND PROSECUTIONS BASED ON MATERIAL DISTRIBUTED SOLELY VIA THE

INTERNET 12

1. The relevant geographic community standard first devel- oped in prior cases involving traditional ʺbrick and mor-

tarʺ applications of the obscenity laws 13

2. Where obscenity prosecutions are based on materials available on the Internet, the courts have indicated that the relevant community by whose standards obscenity should be measured must be re-evaluated, because the use of purely local community standards would chill the dissemination of constitutionally protected expression to myriad other communities where the materials would be

accepted or tolerated and thus lawful 15

II	JURORS CAN ASCERTAIN NATIONAL COMMUNITY STANDARDS TODAY BECAUSE INTERNET MATERIALS, LIKE BROADCAST NEWS AND ENTERTAINMENT MEDIA, ARE AVAILABLE TO ALL. ……………………………	23
III	THE UNPRECEDENTED NATURE OF THE INTERNET ME-
	DIUM REQUIRES STANDARDS THAT ARE SENSITIVE AND
	SUITABLE TO PRESERVING ITS UNIQUE CHARACTERIS-
	TICS ……………………………………………..	28

4. APPLYING LOCAL COMMUNITY STANDARDS WOULD HAVE A DEVASTATING CHILLING EFFECT ON INTERNET EXPRESSION – SIMPLY TOO HIGH A COST TO BE CONSIS- TENT WITH APPLICABLE FIRST AMENDMENT

PROTECTIONS 30

4. WHILE NATIONAL STANDARDS ARE BOTH APPROPRIATE AND PERMISSIBLE, DEFENDANT IS ENTI- TLED AT LEAST TO STATE-WIDE COMMUNITY

STANDARDS 32

TABLE OF AUTHORITIES

Page

FEDERAL CASES

Supreme Court

Ashcroft v. American Civil Liberties Union (Ashcroft I), 535 U.S. 564, 122 S.Ct. 1700, 152 L.Ed.2d 771

(2002) ………………………………. 15, 19, 20, 22, 26, 28, 30

Ashcroft v. American Civil Liberties Union (Ashcroft II), 542 U.S. 656, 124 S.Ct. 2783, 159 L.Ed.2d 690

(2004) ………………………………………………. 18

Butler v. Michigan,

352 U.S. 380, 77 S.Ct. 524, 1 L.Ed.2d 412

(1957) ………………………………………………. 33

Elrod v. Burns,

427 U.S. 347, 96 S.Ct. 2673, 49 L.Ed.2d 547

(1976) ………………………………………………. 32

Hamling v. United States,

418 U.S. 87, 94 S.Ct. 2887, 41 L.Ed.2d 590

(1974) ………………………………………. 19, 24, 25, 29

Manual Enterprises, Inc. v. Day,

370 U.S. 478, 82 S.Ct. 1432, 8 L.Ed.2d 639

(1962) ………………………………………………. 27

Miller v. California,

413 U.S. 15, 93 S.Ct. 2607, 37 L.Ed.2d 419

(1973) …………………………. 9, 10, 13, 14, 16, 18, 23, 27, 33

Pope v. Illinois,

481 U.S. 497, 107 S.Ct. 1918, 95 L.Ed.2d 439

(1987) ………………………………………………. 11

Reno v. ACLU,

521 U.S. 844, 117 S.Ct. 2329, 138 L.Ed.2d 874

(1997) …………………………………………. 16, 17, 26

Sable Communications of California, Inc. v. Federal Communications Commission,

492 U.S. 115, 109 S.Ct. 2829, 106 L.Ed.2d 93

(1989) ……………………………………………. 19, 29

Smith v. United States,

431 U.S. 291, 97 S.Ct. 1756, 52 L.Ed.2d 324

(1977) ………………………………………………. 11

Courts of Appeals

ACLU v. Ashcroft,

322 F.3d 240 (3rd Cir. 2003) 18

ACLU v. Reno,

217 F.3d 162 (3rd Cir. 2000) ………………………….. 15, 18

Luke Records, Inc. v. Navarro,

960 F.2d 134 (11th Cir. 1992) 11

Perfect 10, Inc. v. CCBill L.L.C.,

F.3d (9th Cir. 2007) 22

District Courts

ACLU v. Gonzales,

F.Supp.2d (E.D.Pa. 2007) (2007 WL 861120) ………. 18, 22

Skywalker Records, Inc. v. Navarro,

739 F.Supp. 578 (S.D. Fla. 1990) 14

STATE CASES

Davidson v. State,

288 So.2d 483 (Fla. 1973) …………………………. 13, 14, 33

DOCKETED CASES

Souliaguine v. State of Florida,

Fifth Judicial Circuit of Florida, Appellate Division,

Case no. 2006-AP-300 11

CONSTITUTIONAL PROVISIONS

United States Constitution:

First Amendment ………………………………….. passim

Florida Constitution:

Article 1, §§ 4 & 9 8

FEDERAL STATUTES

47 U.S.C. § 223 (a) 16

47 U.S.C. § 223 (d) 16

47 U.S.C. § 231 Child Online Protection Act (ʺCOPAʺ)1,8, 19, 21, 22, 30, 31, 34

STATE STATUTES

FLORIDA STATUTES:

§ 847.001 (10) ………………………………………… 10

§ 895.03 ……………………………………………. 10

§ 895.03 (3) …………………………………………. 10

§ 895.03 (4) ………………………………………….. 10

§ 847.011 …………………………………………… 10

IN THE CIRCUIT COURT, FIRST JUDICIAL CIRCUIT IN AND FOR ESCAMBIA COUNTY, FLORIDA

STATE OF FLORIDA,

Plaintiff,

vs.

CLINTON R. McCOWEN,

Defendant.

/

CASE NO.: 2006-CF-003151-C

JUDGE: Allen

internet providers, and would violate the United States Supreme Courtʹs admonition in Miller v. California, 413 U.S. 15, 33, 93 S.Ct. 2607, 2620, 37 L.Ed.2d 419 (1973), that the dictates of the most sensitive jurisdictions should not be allowed to suppress the nature of the materials available in communi- ties where they are accepted or tolerated.^1/

Alternatively, defendant would move that the Court determine that the relevant ʺcommunityʺ whose standards will apply should be that of at least the entire state of Florida, as the use of at least a ʺstate-wideʺ standard will reduce, to some degree, the inherent self-censorship which would otherwise be caused by subjecting adult website operators to prosecution under the standards of the least tolerant geographic communities in a state. Use of a

ʺstate-wideʺ standard was specifically approved, though not required, in

Miller.

However, Miller was decided long before the birth of the Internet and its widespread commercial development, the World Wide Web (hence

ʺwww.***ʺ). Miller thus involved only tangible brick-and-mortar businesses. In the context of Internet-based obscenity prosecutions, Millerʹs approval of state wide standards should — in this context only — establish the smallest

¹ As that Court stated:

ʺPeople in different States vary in their tastes and attitudes, and this diversity is not to be strangled by the absolutism of imposed unifor- mity. . . . [T]he primary concern with requiring a jury to apply the standard of ʹthe average person, applying contemporary community standardsʹ is to be certain that . . . it will be judged by its impact on an average person, rather than a particularly susceptible or sensitive person — or indeed a totally insensitive one.ʺ 413 U.S. at 33 (emphasis added).

geographic community whose standards should be applied. Use of the standards of any smaller geographic community than at least the entire state would virtually guarantee the type of self-censorship against which the Miller Court warned, as the most restrictive communities in the nation would ultimately dictate what would be available for viewing in each jurisdiction and community throughout the nation.

RELEVANT FACTS

Defendant McCOWEN has been charged with two felony counts of violating specified subparagraphs of Florida Statutes (ʺFSʺ) § 895.03 prohibit- ing ʺracketeering activity,ʺ^2/ including, inter alia, alleged violations of FS

§ 847.011 (transmission or distribution, etc., of obscenity), in connection with his alleged operation of an adult-oriented website.

The statutory elements which the state must prove to justify a finding of obscenity are set forth in FS § 847.001 (10):

ʺ(10) ʺObsceneʺ means the status of material which:

ʺa. The average person, applying contemporary community standards, would find, taken as a whole, appeals to the prurient interest;

² The first count asserts a violation of § 895.03(3) (engaging in a pattern of racketeering activity); the second count describes the same activity but asserts a violation of § 895.03(4), engaging in a conspiracy to violate the same provision.

ʺb. Depicts or describes, in a patently offensive way, sexual conduct as specifically defined herein; and

ʺc. Taken as a whole, lacks serious literaty, artistic, political, or scientific value.ʺ (Emphasis added.)

Superimposed on that statutory definition of ʺobsceneʺ would be additional constitutionally required refinements of that test. Most significant to the present motion is the requirement, first clarified in Smith v. United States, 431 U.S. 291, 97 S.Ct. 1756, 52 L.Ed.2d 324 (1977), that the ʺ(b) prongʺ (patent offensiveness), as well as the ʺ(a) prongʺ (i.e., prurient interest), must be measured by ʺcontemporary community standards.ʺ^3/

In contrast, the ʺ(c) prongʺ (serious literary, artistic, political or scientific value – ʺLAPSʺ), is measured by a ʺreasonable manʺ standard which is not tied to the standards of any particular geographic community.^4/

The issue presented by this motion is a determination of which geo- graphic communityʹs contemporaneous standards are to be applied when determining whether internet materials (which, by definition, are simulta-

³ ʺ[T]he jury must measure patent offensiveness against contemporary commu- nity standards.ʺ Smith, 431 U.S. at 301, 97 S.Ct. at 1764. Accord, Haggerty v. State, 531 So.2d 364, 365-366 (Fl.App. 1988), reading the CCS requirement of Smith into the obscenity statuteʹs (b) prong to save it from a claim of facial invalidity.

⁴ See Pope v. Illinois, 481 U.S. 497, 500-501, 107 S.Ct. 1918, 1921, 95 L.Ed.2d 439

(1987), as well as a recent unpublished decision in Souliaguine v. State of Florida, Fifth Judicial Circuit of Florida, Appellate Division, Case no. 2006-AP-300 (at pp. 4-5 of slip opinion) (a copy of which is attached as Exhibit A for the Courtʹs convenience). See also Luke Records, Inc. v. Navarro, 960 F.2d 134, 138 (11th Cir. 1992), citing Pope and recognizing that local acceptance of materials is irrelevant to the third prong of the obscenity test.

neously and immediately viewable in real time world wide) meet the (a) and

(b) prongs of the statutory and constitutional definitions of ʺobscene.ʺ

ARGUMENT I

IN DETERMINING WHAT COMMUNITY STAN- DARDS TO APPLY IN OBSCENITY PROSECU- TIONS, THE COURTS HAVE DISTINGUISHED BETWEEN TRADITIONAL ʺBRICK AND MOR- TARʺ PROSECUTIONS AND PROSECUTIONS BASED ON MATERIAL DISTRIBUTED SOLELY VIA THE INTERNET

Although judicial opinions appear to conflict as to the appropriate makeup and geographical dimensions of the relevant geographic “commu- nity” whose standards are to be applied in obscenity cases, these apparent conflicts are readily explained by contrasting the opinions involving tradi- tional ʺbrick and mortarʺ businesses and those operating solely via the Internet.

1. The relevant geographic community standard first developed in prior cases involving traditional ʺbrick and mortarʺ applications of the obscenity laws.

Traditionally, the question of which geographic communityʹs standards should apply came up solely in the context of prosecutions for selling or distributing tangible ʺhard copiesʺ of allegedly obscene materials into or from a particular jurisdiction in which the defendant had chosen to do business. For example, in the seminal obscenity case of Miller v. California, 413 U.S. 15, 93 S.Ct. 2607, 37 L.Ed.2d 419 (1973),^5/ the United States Supreme Court determined that the geographic community was properly found to include the entire State of California (rather than the entire nation), at least with respect to prosecution of a mail-order business which knowingly mailed ʺhard copiesʺ of allegedly obscene materials to a particular address located in California.^6/ A Florida case similar to Miller was Davidson v. State, 288 So.2d 483, 486-

87 (Fla. 1973). Like Miller, Davidson involved a defendant who knowingly chose a particular community into which to ship tangible ʺhard copiesʺ of allegedly obscene materials. While acknowledging that it would have been permissible to employ state-wide standards, the court in Davidson, as in Miller, indicated that, at least in the context of mailing hard copies of materials to a specific address, it was also constitutionally permissible to apply the commu-

⁵ Miller is a seminal decision because it represented the first time in decades of attempts that a majority of the Supreme Court was finally able to agree on a constitutional test for defining obscenity.

⁶ The Court also stated, in dictum, that use of a smaller geographic community would have been permissible, but was not required.

nity standards of the local geographical area to which the material was shipped.

In the subsequent case of Skywalker Records, Inc. v. Navarro, 739 F.Supp. 578, 587-588 (S.D. Fla. 1990), reversed on other grounds, 960 F.2d 134 (11th Cir. 1992), and again a case involving hard copies of materials which a party had sold in a specified local community,^7/ the United States District Court for the Southern District of Florida held that the jury must apply the standards of a tri-county area consisting of Palm Beach, Broward, and Dade Counties (which coincided with the boundary of the jury pool for that court).^8/ Both of the parties asserted that a smaller geographic community should be used, that of Broward County alone,^9/ but the Court disagreed, holding that ʺthe bound- aries of the relevant community under Miller are a matter for judicial, not legislative, determination.ʺ^10/

However, whether the court used the community standards of an entire state (Miller), a three-county area (Skywalker Records), or a single county (Davidson), the common element of those cases was that they all involved

⁷ This action involved a civil suit brought by a record company seeking a determination that 2 Live Crewʹs records and audio cassettes were not obscene, contrary to the claims and enforcement threats of the Broward County Sheriff.

⁸ Although the trial judge ultimately found the recording obscene, the Court of Appeals reversed on grounds that the trial judge could not conclude that the recording lacked serious artistic value based solely on his own value judgments, and the trial record reflected no other evidence to support a finding of a lack of serious artistic value.

⁹ ʺBoth parties apparently assumed that the relevant community was only Broward County, Florida.ʺ 739 F.Supp. at 587.

¹⁰ 739 F.Supp. at 587.

knowing, targeted dissemination into a particular jurisdiction. They did not involve a medium like the Internet (or, more specifically, the World Wide Web) where the materials are theoretically ʺpresentʺ simultaneously every- where in the entire world and per force, in every jurisdiction in the nation, with the disseminator having no way to prevent distribution into jurisdictions with more restrictive community standards.^11/

2. Where obscenity prosecutions are based on materials available on the Internet, the courts have indicated that the relevant community by whose standards obscenity should be measured must be re-evaluated, because the use of purely local community standards would chill the dissemination of constitutionally protected expression to myriad other communities where the materials would be accepted or toler- ated and thus lawful.

With the advent of Internet communications, the constitutionally relevant community in obscenity cases has become exponentially more difficult to determine. The United States Supreme Courtʹs first ʺinternet

¹¹ This inability to control the geographic areas capable of viewing the informa- tion on a website has been well documented. See, e.g., ACLU v. Reno, 217 F.3d 162 (3rd Cir. 2000), enjoining enforcement of the Communications Decency Act (CDA) based specifically on its finding of ʺthe inability of Web publishers to restrict access to their Websites based on the geographic locale of the site visitor.ʺ Id. at 166. On direct appeal, no member of the Supreme Court disagreed with this particular proposition, and four of them expressly addressed it and agreed with it. See Ashcroft

v. American Civil Liberties Union (Ashcroft I), 535 U.S. 564, 122 S.Ct. 1700, 152 L.Ed.2d 771 (2002), concurring opinion of Justice OʹConnor, 535 U.S. at 587; concurring opinion of Justices Kennedy, Souter and Ginsburg, 535 U.S. at 595.

opinion,ʺ Reno v. ACLU, 521 U.S. 844, 117 S.Ct. 2329, 138 L.Ed.2d 874 (1997),

struck down under the First Amendment portions of the Communications Decency Act that criminalized the online transmission of materials with

ʺindecentʺ content to persons under 18,^12/ and the sending or displaying of

ʺpatently offensive messagesʺ to persons under 18.^13/ The Court concluded that the portions prohibiting ʺindecentʺ or ʺpatently offensiveʺ materials were vague and posed too great a risk of self-censorship by website operators. Such self-censorship, in turn, would unconstitutionally limit the scope of constitutionally protected non-obscene materials to which adult users would have access.^14/

Significantly, the Reno Court emphatically rejected the Governmentʹs argument that these portions of the CDA should be treated as ʺsecondary effectsʺ-based restrictions, analogous to ʺa sort of ʹcyberzoningʹ on the Internet,ʺ subject only to the relatively lax standards for analyzing time, place, and manner restrictions of expression. Instead, the Court held that they should be analyzed under the strict First Amendment standards that govern content-based restrictions on expression. Id. at 868, 117 S.Ct. at 2342.

¹² 47 U.S.C. § 223(a).

¹³ 47 U.S.C. § 223 (d).

¹⁴ The terms ʺindecentʺ in § 223(a), and ʺpatently offensiveʺ in § 223(d), were both found impermissibly vague, as neither required proof of all the elements of the Miller Court’s definition of ʺobscene.ʺ Id. at 871-874, 117 S.Ct. at 2344-2346. The plaintiffs did not challenge the CDAʹs separate statutory prohibition of ʺobsceneʺ materials.

Equally significant, Reno rejected the Governmentʹs argument that regulations of the internet should be subject to the same level of somewhat deferential constitutional scrutiny the Court had previously allowed for regulations of the content of the broadcast industry. Id. at 868-869, 117 S.Ct. at 2343. The Court concluded that ʺthe Internet is not as ʹinvasiveʹ as radio or televisionʺ (id.), because it would be far easier to be accidentally exposed to sexually explicit content if such were available on broadcast radio or televi- sion stations, than it would be to accidentally encounter such materials on the World Wide Web.” Id. at 869-870, 117. S.Ct. at 2343-2344.

Although the issue of which geographic communityʹs contemporary standards should be employed in determining whether online materials are either indecent or patently offensive obscene did not arise in Reno (because the Courtʹs ruling of facial invalidation made it unnecessary to reach that issue), Reno did offer the following observation which sheds some light on what is at issue when a court must determine what geographic communityʹs stan- dards should be employed in the context of an internet-based obscenity prosecution. Specifically, the Court noted that the various internet-based media (including, e.g., web-sites, listservs, and ʺchat roomsʺ) — collectively

ʺknown to its users as ʹcyberspaceʹ — [are] located in no particular geograph- ical location but available to anyone, anywhere in the world, with access to the Internet.ʺ Id. at 851, 117 S.Ct. at 2335. The Court estimated that by 1999, the Internet would be used by at least 200 million people. Id. at 850, 117 S.Ct. at

2334. Of course, the current number of users entirely dwarfs that 1999 esti- mate.^15/

After the Supreme Court invalidated the CDA, Congress responded by enacting the Child Online Protection Act (ʺCOPAʺ), 47 U.S.C. § 231, which uses a modified version of the Miller test to determine whether Internet materials are considered “harmful to minors.” In reviewing a preliminary injunction restraining enforcement of the statute, the Third Circuit Court of Appeals determined that COPA was facially unconstitutional to the extent that it required the ʺprurient interestʺ and ʺpatent offensivenessʺ prongs to be assessed on the basis of contemporary community standards.^16/ It reasoned that while the use of contemporary community standards makes sense in traditional obscenity prosecutions where a defendant has an opportunity to limit the geographic areas into which he sells or mails materials, its applica- tion in the context of an internet obscenity prosecution rendered the statute facially invalid.^17/

On appeal, a majority of the Supreme Court vacated the Court of Appealsʹ ruling and remanded. The Supreme Court said it was premature to

¹⁵ A more recent estimate (updated as of March 10, 2007) places the world-wide number at 6 1/2 billion current users. See Internet World Stats, Useage and Popula- tion Statistics, http://www.internetworldstats.com/stats7.htm.

¹⁶ American Civil Liberties Union v. Reno, 217 F.3d 162, 169-170 (3rd Cir. 2000), vacated by Ashcroft v. American Civil Liberties Union (Ashcrost I), 535 U.S. 564, 122 S.Ct. 1700, 152 L.Ed.2d 771 (2002); opinion on remand, ACLU v. Ashcroft, 322 F.3d 240 (3rd Cir. 2003); second opinion on appeal, Ashcroft v. American Civil Liberties Union (Ashcroft II), 542 U.S. 656, 124 S.Ct. 2783, 159 L.Ed.2d 690 (2004); Dist. Ct. opinion following remand, sub nom. ACLU v. Gonzales, F.Supp.2d (E.D.Pa. March 22, 2007) (2007 WL 861120).

¹⁷ ACLU v. Reno, 217 F.3d 162, 169-179 (3rd Cir. 2000).

hold the statute facially unconstitutional, and that the Court of Appeals had erred in concluding that COPA was necessarily rendered facially invalid solely by virtue of the fact that it had employed any ʺcommunity standardsʺ require- ment at all.^18/ However, every member of the Court joined in one opinion or another describing the appropriate ʺcommunity standards.ʺ Significantly, only three members of the Court (Justice Thomas, Chief Justice Rehnquist, and Justice Scalia) concluded that it would be permissible to apply local (rather than national) community standards in Internet prosecutions under COPA. No other justices shared that view.

In contrast, Justice OʹConnor concluded that COPA could only meet constitutional requirements if a ʺnational [community] standardʺ were used. 535 U.S. at 587. Justice OʹConnor first traced the Courtʹs precedents to conclude that adoption of a national standard in the internet context was not precluded by any prior decisions. She then explained the basis for her opinion:

I agree with Justice Kennedy that, given Internet speakers’ inabil- ity to control the geographic location of their audience, expecting [Internet speakers] to bear the burden of controlling the recipients of their speech, as we did in Hamling and Sable,^[19/] may be entirely

¹⁸ Ashcroft v. American Civil Liberties Union (Ashcroft I), 535 U.S. 564, 122 S.Ct. 1700, 152 L.Ed.2d 771 (2002).

¹⁹ Hamling v. United States, 418 U.S. 87, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974), involved a brick and mortar prosecution for mailing obscene materials. Sable Communications of California, Inc. v. Federal Communications Commission, 492 U.S. 115, 109 S.Ct. 2829, 106 L.Ed.2d 93 (1989), involved decency regulations applicable to what the Court referred to as a ʺdial-a-pornʺ service.

too much to ask, and will potentially suppress an inordinate amount of expression.^20/

Justice Breyer, also writing individually, concurred on the basis that Congress, as a matter of legislative intent, had intended the statutory word

ʺcommunityʺ to refer to the entire nationʹs adult community taken as a whole, and not to geographically separate local areas. Id. at 589. However, as reflected in the following passage, he appeared to believe that even had that not been Congressʹ intent, such a standard might have been constitutionally required:

ʺTo read the statute as adopting the community standards of every locality in the United States would provide the most puritan of commu- nities with a heckler’s Internet veto affecting the rest of the nation. The technical difficulties associated with efforts to confine Internet material to particular geographic areas make the problem particularly serious.ʺ^21/ Three other Justices – Justices Kennedy, Souter, and Ginsburg — sepa-

rately concurred on the ground that a critical issue is ʺcommunity standards as to what?ʺ Id. at 592 (emphasis added). Those Justices concluded that the use of community standards, per se, was not unconstitutional, but expressly disagreed with Justice Thomasʹ opinion that ʺthe Act is narrow enough to render the national variation in community standards unproblematic.ʺ Id. at

²⁰ Ashcroft I, 535 U.S. at 587 (O’Connor, J., concurring).

²¹ Ashcroft I, 535 U.S. at 590 (Breyer, J., concurring).

593. In explaining their reasoning, they also commented on the problems associated with using purely local standards:

ʺWhether the national variation in community standards produces overbreadth requiring invalidation of COPA, . . . depends on the breadth of COPAʹs coverage and on what community standards are being invoked.ʺ 535 U.S. at 592 (emphasis added).

Justice Kennedy expanded upon the above-italicized language:

ʺThe Court of Appeals found that COPA in effect subjects every Internet speaker to the standards of the most puritanical community in the United States. This concern is a real one . . . . Unlike Justice Thomas,

. . . I would not assume that the Act is narrow enough to render the national variation in community standards unproblematic.ʺ Id. at 593. Justice Stevens likewise noted the special First Amendment problems created when internet speech is subjected to ʺthe standards of the community most likely to be offended by the message,ʺ id. at 603, and concluded that COPA was facially unconstitutional in all circumstances. He further observed:

ʺIn its original form, the community standard provided a shield for communications that are offensive only to the least tolerant members of society. . . . In the context of the Internet, however, community stan- dards become a sword, rather than a shield. If a prurient appeal is offensive in a puritan village, it may be a crime to post it on the World Wide Web.ʺ

Based on that reasoning, he found COPA facially invalid in all applications, apparently being unwilling to give it a potential saving construction that would require use of national rather than local standards.

Consequently, although the Supreme Court in Ashcroft I did not render a square holding on whether national or local community standards should apply where Internet prosecutions are at issue, at least six Justices strongly suggested that an Internet-based prosecution based upon use of local rather than national community standards was likely to be unconstitutional.^22/ Cf. Perfect 10, Inc. v. CCBill L.L.C., F.3d (9th Cir. 2007).^23/

²² In a postscript to this point, defendant notes that a final judgment was just rendered by the District Court in that action on March 22, 2007, following two remands from the Supreme Court. ACLU v. Gonzales, F.Supp.2d. (E.D.Pa. 2007) (2007 WL 861120). The District Court found COPA entirely unconstitutional on its face, after it made numerous findings of fact regarding the adverse impact of such a law on Internet expression. As this most recent ruling on remand was not based on the ʺcontemporary community standardsʺ issue, it is not otherwise discussed in the present motion.

²³ In this very recent decision, the Ninth Circuit Court of Appeals concluded that state penalties for certain Internet copyright violations are preempted by federal copyright exemptions for Internet content providers, saying:

ʺBecause material on a website may be viewed across the Internet, and thus in more than one state at a time, permitting the reach of any particular state’s definition of intellectual property to dictate the contours of this federal immunity would be contrary to Congress’s expressed goal of insulating the development of the Internet from the various state-law regimes. *** In the absence of a definition from Congress, we construe the term ʺintellectual propertyʺ to mean ʺfederal intellectual property.ʺ Id. at *11.

II

JURORS CAN ASCERTAIN NATIONAL COMMU- NITY STANDARDS TODAY BECAUSE INTERNET MATERIALS, LIKE BROADCAST NEWS AND ENTERTAINMENT MEDIA, ARE AVAILABLE TO ALL.

Although the Miller Court approved use of state-wide community standards, many courts trying such cases opted for more localized standards, simply because they believed that jurors would be much more familiar with local standards than state-wide or national standards. In the 1970s, when this case law was evolving, that perception may well have been correct.

However, over the last 30 or more years, isolated American communi- ties operating in oblivion and ignorance of the standards and mores outside their borders have become a thing of the past. This striking change in Ameri- can culture has been brought about by a combination of many factors, including the disappearance of local broadcast news media (increasingly replaced by national and cable newcasts), a significant decrease in other local broadcast programming, and last, but certainly not least, the omnipresent nature of information (including both news and entertainment) coming from the Internet. Everyone potentially sees and experiences everything at the same time — or within hours — of everyone else.^24/

²⁴ This contemporaneous level of experience is facilitated by the increasingly

(continued…)

Because of this increased nationalization, all Americans are now exposed to the same information, including the same sounds, images and expression. Consequently, the notion of jurors from an isolated community of sheltered ʺstay-at-homeʺ citizens being unable to fathom or ascertain national community standards, is certainly not a significant concern (even assuming it ever once was^25/).

Certainly, there are still significant differences in that which is tolerated in one community compared to another. However, even in more conservative communities, citizens today have a much greater awareness of what exists in the broader national community.^26/ These days, and to an ever-increasing extent, we all see essentially the same news reports, the same entertainment, etc.^27/

²⁴ (…continued)

ubiquitous handheld and mobile devices which allow users to instantaneously receive news and information on everything from pending military action to the latest celebrity scandal.

²⁵ As noted infra, Hamling v. United States, 418 U.S. 87, 105-106 (1974), expressly recognized that there was no constitutional or practical problem with jurors, in appropriate cases, applying contemporary standards of communities other than their own.

²⁶ Moreover, even if a particular local community may happen to have compara- tively restrictive standards, jurors from such communities can recognize and apply a standard other than their own if told to do so. (Again, as Hamling clarified, a jury may be asked to apply the standards of another community if a case is transferred, e.g., on a motion for change of venue.) Just as in the course of a trial, lay jurors can become familiar with and apply concepts, procedures or regulations previously unknown to them, so too can properly instructed jurors working with different communitiesʹ standards apply them in an obscenity case.

²⁷ For example, Janet Jacksonʹs notorious ʺwardrobe malfunctionʺ at the 2005 Superbowl was simultaneously viewed on television by millions from every American community (and later was then repeatedly viewed again and again by millions on the Internet). Another example, exclusive to the Internet, is of a notorius

(continued…)

Consequently, should this Court agree with the majority of Supreme Court justices who have concluded that Internet obscenity should be measured by national community standards, that would be a relatively easy legal ruling to implement; it would not be terribly difficult to find a local jury with a reasonable understanding of — or at least an ability to apply — those stan- dards. Certainly, experts could assist jurors in ascertaining those standards, but most jurors will have at least a general sense of those standards at the outset. Moreover, the Supreme Court long ago made clear that jurors, if so directed, may constitutionally apply the standards of communities other than their own.

Specifically, in Hamling v. United States, 418 U.S. 87, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974), and in the context of a prosecution of a traditional brick- and-mortar business mailing allegedly obscene materials into a targeted community, the Supreme Court observed that although local community standards should apply to such prosecutions, it was also permissible, in appropriate cases, for jurors to apply community standards other than their own. After recognizing that the jurors in that case could apply their own local community standards, given that the offense occurred in the same jurisdiction from which the jurors were drawn, the Court nonetheless advised:

²⁷ (…continued)

photo of the pubic area of entertainer Britney Spears captured by a paparazzo as the actress was exiting a vehicle. That photo was on thousands of websites, and viewed by millions, within a short period of time after it was taken. Comments concerning that photo (and the propriety of its being published) were equally widely available on the Internet. All this material makes a national community standard much more

ʺknowableʺ in each local community, regardless of whether that national standard is congruent with each local standard.

ʺBut this is not to say that a district court would not be at liberty to admit evidence of standards existing in some place outside of this particular district, if it felt such evidence would assist the jurors in the resolution of the issues which they were to decide.ʺ 418 U.S. at 105-106 (emphasis added).

Clearly the Court contemplated that, in appropriate cases, jurors could be presented with evidence with which to assist them in evaluating the standards of a broader or different community beyond their own. Moreover, as made clear by six of the Justices in dictum in Ashcroft I, prosecutions of those having sexually explicit materials on Internet sites is precisely the type of case where such broader community standards should be employed.

Finally, perhaps the simplest reason for concluding that national standards should apply is that, in the past, there was nowhere near the level of national sharing of information and opinions that there is today. The Internet has been called “the most participatory form of mass speech yet developed.”^28/ According to the Court, the Web is a “unique and wholly new medium of worldwide human communication.”^29/

In part because of the highly participatory nature of the Internet itself, and also because of the ubiquitous nature of network programming and cable

²⁸ Reno v. American Civil Liberties Union, 521 U.S. 844, 863 (1997) (quoting

American Civil Liberties Union v. Reno, 929 F.Supp. 824, 883 (E.D. Pa. 1996)).

²⁹ Reno v. American Civil Liberties Union, 521 U.S. at 850.

television, national standards are far more ascertainable than in the past.^30/ Consequently, although national standards may, in the past, have occasionally been considered to be too inherently ʺunknowableʺ compared to local stan- dards,^31/ today, given the total saturation of nationwide network entertain- ment, news, opinions and commentary, as well as the ubiquitous availability of the same information to hundreds of millions of people simultaneously over the Internet, there is no longer any validity to the assertion that national standards are significantly less knowable than local standards.

³⁰ And, again, another component is that this information is now received and shared not only via computer, but also through cell phones, PDAʹs, iPods, MP3 players, podcasts, Bluetooth devices, gaming consoles, and countless other electronic gadgets and media.

³¹ Contrast, e.g., Miller, which, in the context of a ʺbrick and mortarʺ medium had rejected national standards as being too ʺhypothetical and unascertainableʺ (413 U.S. at 31), with Justice Harlanʹs plurality opinion in Manual Enterprises, Inc. v. Day, 370

U.S. 478, 82 S.Ct. 1432, 8 L.Ed.2d 639 (1962), concluding that national community standards should apply to all federal obscenity prosecutions. 370 U.S. at 488. Justice Harlan had come to that conclusion because of what he saw as ʺthe intolerable consequence of denying some sections of the country access to material, there deemed acceptable, which in others might be considered offensive to prevailing community standards.ʺ Id.

III

THE UNPRECEDENTED NATURE OF THE INTERNET MEDIUM REQUIRES STANDARDS THAT ARE SENSITIVE AND SUITABLE TO PRE- SERVING ITS UNIQUE CHARACTERISTICS

As many of the Supreme Court justices (indeed, a majority) expressly noted in Ashcroft I, each mode of expression has its own unique characteristics, and therefore must be accessed for First Amendment purposes by the stan- dards best suited to it. For example, Justice Stevens found significant distinc- tion between online communications and those sent through the mail, or over the telephone lines, because in the latter two circumstances the sender could avoid destinations with the most restrictive standards.^32/ Ashcroft I, 535 U.S. at 602 (Stevens, J., dissenting). In previous cases, he observed, local commu- nity standards were upheld based on the sender’s ability to tailor his messages to the communities it chose to serve, thus creating a permissible burden on the speaker to comply.^33/ However, the sender of Internet transmissions must necessarily display his message ʺto all of the 176.5 million Americans who have access to the Internetʺ if he chooses to display that message to even one.

³² Of course, unlike both mailed communications and telephonic communications, there simply is no ʺsenderʺ at all in the Internet context. The viewer goes to the website electronically and gets the material, whether the actual website is situated down the block or entirely across the world. No web publisher reaches out to the specific locale of the consumer.

³³ Id. at 605.

Id. Accordingly, he concluded that this “fundamental difference in technolo- gies,” requires a difference in the rules applicable to that particular medium:

ʺIn light of this fundamental difference in technologies, the rules applicable to the mass mailing of an obscene montage or to obscene dial-a-porn should not be used to judge the legality of messages on the World Wide Web.ʺ Id. at 606.

Likewise, Justices Kennedy, Souter, Ginsburg and OʹConnor agreed that the standards for controlling the content of traditional mail-order businesses and even phone-sex businesses should not apply to Internet-based businesses due to the uniqueness of that medium. See, e.g., 535 U.S. at 594-596 (Kennedy, Souter and Ginsburg, JJ., concurring),^34/ and 535 U.S. at 587 (OʹConnor, J., concurring)^35/

³⁴ Justice Kennedy, in a concurring opinion joined by Justices Souter and Ginsburg, stated:

ʺIt is true, as Justice Thomas points out, . . . that requiring a speaker addressing a national audience to meet varying community standards does not always violate the First Amendment. See Hamling v. United States, 418 U.S. 87, 106, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974) (obscene

mailings); Sable Communications of California, Inc. v. Federal Communica- tions Commission, 492 U.S. 115, 125-126, 109 S.Ct. 2829, 106 L.Ed.2d 93

(1989). These cases, however, are of limited utility in analyzing the one before us, because each mode of expression has its own unique charac- teristics, and each ʹmust be assessed for First Amendment purposes by standards suited to it.ʹ Southeastern Promotions, Ltd. v. Conrad, 420 U.S. 546, 557, 95 S.Ct. 1239, 43 L.Ed.2d 448 (1975). Indeed, when Congress purports to abridge the freedom of a new medium, we must be particu- larly attentive to its distinct attributes, for ʹdifferences in the character- istics of new media justify differences in the First Amendment stan- dards applied to them.ʹ Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 386, 89 S.Ct. 1794, 23 L.Ed.2d 371 (1969).ʺ Id. at 594-95.

³⁵ Justice OʹConnor stated:

ʺI agree with Justice Kennedy that, given Internet speakersʹ inability to control the geographic location of their audience, expecting them to bear the burden of controlling the recipients of their speech, as we did in Hamling and Sable, may be entirely too much to ask, and would

(continued…)

IV

APPLYING LOCAL COMMUNITY STANDARDS WOULD HAVE A DEVASTATING CHILLING EFFECT ON INTERNET EXPRESSION – SIMPLY TOO HIGH A COST TO BE CONSISTENT WITH APPLICABLE FIRST AMENDMENT PROTECTIONS

As discussed above, a clear majority of the Justices of the Supreme Court in Ashcroft I rejected the notion of applying local community standards to sexually oriented materials on the Internet. A majority of those judges con- cluded that application of local community standards in the Internet context would have too great a chilling effect on protected expression to be consistent with the requirements of the First Amendment. In all, five of the nine Justices concluded that use of nationwide standards, at least in the context of COPA, was not inherently unascertainable or unworkable, and a sixth, Justice Stevens, found COPA facially unconstitutional no matter how applied. Only three Justices^36/ found that use of local community standards would be permissible in a prosecution under COPA.

³⁵ (…continued)

potentially suppress an inordinate amount of expression.ʺ Id.

³⁶ Counsel recognize that one of the six justices (Justice OʹConnor) is no longer on the Court. However, her departure leaves five Justices in support of or without opposition to a national standard for Internet obscenity.

All six Justices gave the same reason for insisting upon national, rather than local, standards: the chilling impact which applying local standards would have on Internet expression. See, e.g., 535 U.S. at 587 (OʹConnor, concurring opinion), finding that use of local standards ʺwould potentially suppress an inordinate amount of expressionʺ; 535 U.S. at 590 (Breyer, concurring opinion), stating that ʺ[t]o read the statute as adopting the commu- nity standards of every locality in the United States would provide the most puritan of communities with a hecklerʹs Internet veto affecting the rest of the Nationʺ; 535 U.S. at 593 (concurring opinion of J. Kennedy, joined by Justices Souter and Ginsburg), concluding that subjecting Internet expression to local community standards ʺin effect subjects every Internet speaker to the stan- dards of the most puritanical community in the United Statesʺ and stating that

ʺ[t]his concern is a real one.ʺ Finally, Justice Stevens dissented, 535 U.S. at 603, because he would have held COPA unconstitutional because ʺʹthe ʺcommu- nity standardsʹ criterion as applied to the Internet means that any communica- tion available to a nationwide audience will be judged by the standards of the community most likely to be offended by the message.ʹʺ

Based on these opinions, it is clear that, at least where Internet-based speech is involved, it would be error of constitutional dimension to apply local standards, as there is simply too great a risk that such prosecutions will chill vast amounts of expression by others not before the court. Speakers would inevitably be fearful of having the constitutionality of their expression evaluated by the least tolerant communities in America and would then self-

censor to avoid the risk of prosecution in such jurisdictions. The resultant reduction in Internet available fare might please some, but given the inability of webmasters to limit geographical availability, others all over the country and the world would be deprived of constitutionally protected expression. This is a significant concern.^37/

V

WHILE NATIONAL STANDARDS ARE BOTH APPROPRIATE AND PERMISSIBLE, DEFENDANT IS ENTITLED AT LEAST TO STATE-WIDE COM- MUNITY STANDARDS.

For all the reasons above, the materials charged in this case should be evaluated under national community standards rather than local ones. However, in the alternative, defendants move the Court, as a matter of policy, fairness, and the overwhelming weight of authority, to require that the jury at least apply state-wide community standards. While such a standard might not be adequate, in many states, to be used as a substitute for national standards, Florida is a sufficiently diverse state that it may well be that the

³⁷ For example, in Elrod v. Burns, 427 U.S. 347, 373-374, 96 S.Ct. 2673, 2690, 49 L.Ed.2d 547 (1976), the Supreme Court held that even temporary interferences with the dissemination of constitutionally protected expression constitute injury which is ʺirreparable.ʺ A fortiori, where as here, a challenged statutory interpretation has the potential of effecting a permanent censorship, such a concern mandates use of a statutory interpretation that protects constitutional values.

diversity of standards within this state fairly represents the diversity of standards within the nation as a whole.^38/

Moreover, since the United States Supreme Court, in Miller, and the Florida Supreme Court in Davidson, have both expressly approved of use of a state-wide community standard, the use of such a standard is the absolute minimum to which defendants should entitled in an internet-based obscenity prosecution. It will at least reflect a sufficient breadth and diversity of experience and viewpoint to dilute the potential for First Amendment damage which is the inevitable byproduct of exclusive reliance solely on local stan- dards in an Internet-based case.

In short, insuring that at least full state-wide standards apply will provide some barrier to a type of concern analogous to the one described in Butler v. Michigan, 352 U.S. 380, 77 S.Ct. 524, 1 L.Ed.2d 412 (1957), where the Supreme Court struck down a law that ʺprohibited distribution of a book to the general public on the basis of the undesirable influence it may have upon youth.ʺ 352. U.S. at 381. The Court concluded that the impermissible effect of the enactment was ʺto reduce the adult population of Michigan to reading only what is fit for children.ʺ Id. at 383. By analogy, the use of anything less than at

Florida is a true melting pot, and thus representative of the views and opinions of individuals throughout the nation. Therefore, many of the concerns presented by using the community standards of a less diverse state are not as pointed given Floridaʹs unique makeup.

least a full state-wide community standard would be to reduce that which is available on the Internet to that deemed acceptable only in the communities with the most restrictive community standards. As the more recent COPA cases teach, that is an approach impermissibly restrictive of expression.

WESTON, G RRBU;i:)e ITT &

WALT

Lawrence G. Walters Florida Bar No.:776599 Derek B. Brett

Florida Bar No.: 0090750 781Douglas Avenue Altamonte Springs FL 32714

(407) 975-9150 (phone)

(407) 774-6151(fax)

Jerrx Mooney

Cahfomia Bar. No. 199542 Admitted ].JYO hac vice 12121Wilshire Blvd. Suite 900 Los Angeles CA 90025

(310) 442-0072

(310) 442-0899 (fax)

Of Counsel

Attorneys for Defendant McCOWEN

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Motion to Determine the Nature and Scope of the Community has been provided via U.S. Mail to Russell Edgar, Esquire, State Attorney’s Office, Post Office Box 12726, Pensacola, Florida 32575, M. James Jenkins, Esquire, 1211 West Garden Street, Pensacola, Florida 32501, and Clinton Couch, Esquire, 3 West Garden Street, Suite 352, Pensacola, Florida 32502, this 5th day of April 2007.

 

BEFORE THE UNITED STATES DEPARTMENT OF JUSTICE

Washington, D.C. 20530

Docket No. CRM 103 AG Order no. 2723-2004 RIN 1105-AB 505

To: Andrew Oosterbaan, Chief

Child Exploitation and Obscenity Section Criminal Division

United States Department of Justice Washington, D.C. 20530

COMMENTS

These comments are submitted pursuant to the above captioned proposed rule, dated June 25, 2004, 69 F.R. 35547, and relating to 18 U.S.C. § 2257.

BACKGROUND AND INTRODUCTION

The undersigned law firm represents many producers of still and motion pictures and print publications to which 18 U.S.C. § 2257 applies, as well as webmasters, Web hosts, Internet service providers and access providers, age verification services and distributors of such still and motion pictures in videotape, DVD, magazine and other formats, including the Internet. All of the proposed regulations apply to at least some of those clients. Following are the most significant concerns of those clients.

I.

THE EFFECTIVE DATES OF THE STATUTE AND REGULATIONS ARE CONTRARY TO LAW AND PRECEDENT

Enforcement of 18 U.S.C. § 2257 and the regulations thereunder promulgated by the Department was enjoined from the outset until July 3, 1995. Thereafter, the Department, in response to threatened litigation, agreed that the effective date of both 18 U.S.C.§ 2257 and the regulations promulgated thereunder would be July 3, 1995, rather than the effective dates specified therein, respectively November 1, 1990 and May 26, 1992. Because the district court conclusively established July 3, 1995 as the effective

date, which the Department publicly agreed would be uniformly applied, producers and distributors of materials made before then cannot be forced to comply with the statute and regulations retroactively.

Background

The Child Protection Restoration and Penalties Enhancement Act of 1990 was enacted on November 29, 1990. PL 101-647, 104 Stat 4789. Compliance with 18 U.S.C.

§ 2257, according to the face of the statute, was required as of November 1, 1990. Id., § 301(b); 18 U.S.C. § 2257(a)(1).

The regulations promulgated pursuant to the Act, 57 FR 15017-01, issued April 24, 1992 established an effective date for their application as May 26, 1992. 28 C.F.R.

§§ 75.2(a, b), 75.6 and 75.7(a)(1).

On February 21, 1991, several plaintiffs filed suit in the United States District Court for the District of Columbia, challenging the constitutionality of the Act, along with an application for a temporary restraining order. American Library Association, et al. v. Thornburgh, et al., case number 91-cv-00394-SS. Five days later, the court entered a “Stipulated Order by Judge Stanley Sporkin re Non-Enforcement of the Child Protection Restoration and Penalties Enhancement Act of 1990 Until Regulations Implementing the Act become effective; allowing time for comment following publication; and extending Filing Time for all Motions and Responses.”

The regulations promulgated pursuant to the Act, 57 FR 15017-01, issued April 24, 1992 established an effective date for their application as May 26, 1992. See 28 C.F.R. §§ 75.2(a)(1-2), 75.6 and 75.7(a)(1).

Following a flurry of briefing and argument, the court in the American Library Association case granted summary judgment in favor of the plaintiffs, largely striking down the statute:

“ORDER by Judge Stanley Sporkin: granting motion for summary judgment [36-1] by plaintiff(s), denying motion for summary judgment [25-2] by RICHARD THORNBURGH, DOJ; declaring that the record-keeping and labeling provisions of the Child Protection Restoration and Penalties Enforcement Act of 1990 as applied to producers and distributors of any material that contains depictions of people under 18 years of age is constitutional; declaring that the Act as applied to producers and distributors of any material who have satisfied themselves after due diligence that such material does not contain depictions of people under 18 years of age is unconstitutional; and enjoining the defendants from

enforcing the record-keeping and labeling provisions of the Act with respect to producers and distributors of any material who have satisfied themselves after due diligence that such material does not contain depictions of people under 18 years of age.”¹

The supporting opinion is published, American Library Ass’n. v. Barr, 794 F.Supp. 412 (D.D.C. 1992).

The resulting permanent injunction remained in effect during the appeal process, which ultimately resulted in some aspects of the Act being found unconstitutional, but finding that the Act in general did not offend the Constitution. Id., affirmed in part, reversed in part sub nom. American Library Ass’n. v. Reno, 33 F.3d 78 (D.C. Cir. 1994) rehearing denied (1995), suggestion for rehearing en banc denied 47 F.3d 121 (28, 1995)

cert. denied 515 U.S. 1158, 115 S.Ct. 2610, 132 L.Ed.2d 854 (1995).

The Court of Appeals received notice on June 27, 1995 that the United States Supreme Court had denied the petition for writ of certiorari on the previous day. Accordingly, the mandate of reversal was issued by the Court of Appeals on July 3, 1995.²

The effect of the issuance of the mandate of reversal was to dissolve the permanent injunction and its prohibition against the enforcement of the Act. On July 28, 1995, a hearing was held in the district court concerning the issue of enforcement of the Act with respect to activities that took place prior to the July 3, 1995 mandate, dissolving the injunction. The court found that the Department should be prohibited from enforcing the Act with respect to materials produced prior to that date. The order, in relevant part, stated:

“. . . [D]efendants shall not seek to enforce the Act against, or hold liable under the Act, plaintiff producers and distributors, their members or anyone in their chain of supply or distribution, for materials containing visual depictions made prior to July 3, 1995, provided such producers and distributors satisfied themselves after due diligence that such visual depictions are not of people under 18 years of age.”

The Department appealed from that order to the United States Court of Appeals for the District of Columbia Circuit.

¹ The forgoing is according to the records of the United States District Court for the District of Columbia, case number 91-cv-0394, which records can be accessed at the PACER (“Public Access to Court Electronic Records”) Web site. See http://pacer.psc.uscourts.gov.

² The forgoing is according to the records of the United States Court of Appeals for the District of Columbia Circuit, case number 92-5271, which records also can be accessed at the PACER Web site.

Meanwhile, those in the adult industry raised same issue with respect to those that were not plaintiffs in the American Library Association litigation. The Free Speech Coalition, an adult-industry trade group not a plaintiff, threatened to undertake litigation to achieve the same result as in the American Library Association case. However, after some negotiation, Deputy Assistant Attorney General Kevin V. DeGregory wrote a letter to Paul J. Cambria, Esq., the attorney who had been representing the Free Speech Coalition in the matter, as follows:

“Dear Mr. Cambria:

“It has come to my attention that you intend to file a complaint in the United States District Court for the Central District of California challenging the constitutionality of the recordkeeping statute, Title 18 United States Code, Section 2257 (“the Act”). It is my understanding that your primary concern is that your clients be treated similarly to the plaintiffs in American Library Association v. Reno with respect to compliance obligations under the Act in the period May 26, 1992 to July 3, 1995.

“The Department will apply the ultimate judicial determination in the ALA case to your clients. Thus, if the United States pursues its appeal of the July 28, 1995 order in American Library and is not successful, or determines not to pursue the appeal, your clients’ obligations under the Act would be identical to the obligations of those explicitly covered by the July 28th order.

“I hope this proposal offers a solution to your clients’ concerns and that your proposed lawsuit proves unnecessary. Please do not hesitate to contact my office if I can provide more assistance on this or any other matter.”

On November 29, 1995, the Department moved the court of appeals to dismiss the appeal, which motion was granted on December 18, 1995.³

Since then, the entire adult entertainment industry has been laboring under the reasonable belief that the effective date of both the Act and of the underlying regulations was July 3, 1995. Numerous articles in trade publications and on Internet sites have expressed that position.⁴ Moreover, on November 29, 1995 Ann M. Kappler, Esq., one

³ Id., case number 95-5342.

⁴ E.g., Special AVN Report on the Labeling and Record-Keeping Compliance, ADULT VIDEO NEWS September, 1995, p. 265, Clyde DeWitt’s Legal Commentary, ADULT VIDEO NEWS October, 1995, Clyde

DeWitt’s Legal Commentary, ADULT VIDEO NEWS December, 1995, The Labeling and Record Keeping Law As We Now Know It, ADULT VIDEO NEWS January, 1996, YNOT News, Ask the Lawyers, April 3, 2003, http://ynotnews.ynotmasters.com/issues/040303/page7.html, Gone Too Wild, AVN ONLINE, April,

of the attorneys in the American Library Association case, issued a memorandum to the Plaintiffs “and supporters”, announcing that the government was filing its motion to dismiss the appeal from the order concerning the effective date of the Act and its regulations.

“Once the court grants [the Department’s motion to dismiss the appeal of the order concerning the effective date], Judge Sporkin’s order will become final. Because the government has already informed interested parties that it will adopt a uniform enforcement policy, the order will apply to everyone.

“In sum, once the court grants the motion to dismiss, it will be absolutely clear that images created prior to July 3, 1995 are not subject to the recordkeeping law (regardless of when they are published, duplicated or distributed. [Emphasis in the original.]”

That memorandum was widely circulated in the adult media industry, and was relied upon universally, as was the letter from Deputy Assistant DeGregory.

There remains in place the July 28, 1995 order, prohibiting the Department from enforcing the Act against the American Library Association plaintiffs “or anyone in their chain of supply or distribution.”

Suggested Remedy

The regulations should respect that injunction, and its corresponding promise to obey it and enforce the Act along with the implementing regulations evenhandedly. Accordingly, 28 C.F.R. § 75.2(a) should be corrected by substituting July 3, 1995 in place of November 1, 1990; 28 C.F.R. § 75.2(a)(1) should be corrected by substituting July 3, 1995 in place of May 26, 1992; 28 C.F.R. § 75.2(a)(2) should be corrected by substituting July 3, 1995 in place of May 26, 1992; 28 C.F.R. § 75.6 should be corrected by substituting July 3, 1995 in place of May 26, 1992; and 28 C.F.R. § 75.7(a)(1) should be corrected by substituting July 3, 1995 in place of May 26, 1992.

2003, p. 32, The Labeling And Record-Keeping Requirements of 18 U.S.C. § 2257, ADULT VIDEO NEWS June 2003, p.305 and Knock, Knock, It’s the 2257 Man, ADULT VIDEO NEWS June, 2004, p. 279.

II.

THE REQUIREMENTS IMPOSED UPON “SECONDARY PRODUCERS” EXCEED STATUTORY AUTHORITY

The underlying statute expressly states that the requirement to inspect and copy identification documents, acquire information from performers and keep and index records to be available for inspection applies to anyone who produces qualifying images which, according to statutory definition, “does not include mere distribution or any other activity which does not involve hiring, contracting for[,] managing or otherwise arranging for the participation of the performers depicted.” Both as originally enacted and as proposed to be amended, the regulations require what are defined as “secondary producers” to keep, index and make available for inspection the enumerated records, despite the clear statutory exemption for most of those so defined. The only case addressing the issue, Sundance Associates, Inc. v. Reno, 139 F.3d 804 (10th Cir. 1998), held that aspect of the regulations exceeded the Department’s statutory authority. The proposed, amended regulations, nonetheless, effectively retain the requirement that secondary producers maintain records in the same manner as primary producers, a requirement that was squarely struck down in Sundance. Additionally, a requirement that primary producers supply to all secondary producers copies of information about the performers, including identification documents typically including the performers’ residential addresses, serves no purpose but creates a significant risk that private information about the performers will become publicly available.

Background

While anyone involved in the distribution of an image that falls within the purview of 18 U.S.C. § 2257 is required to insure that the required statement is attached, the statute commands that producers also examine identification, collect information and keep and index the records created as a result, allowing inspection by the Attorney General. Those requirements apply to “[w]hoever produces” the material in question. 18

U.S.C. § 2257(a). The statute defines “produces” as “to produce, manufacture, or publish any book, magazine, periodical, film, video tape or other similar matter and includes the duplication, reproduction, or reissuing of any such matter, but does not include mere distribution or any other activity which does not involve hiring, contracting for[,] managing, or otherwise arranging for the participation of the performers depicted.” 18

U.S.C. § 2257(h)(3).

However, both the original regulations and the proposed, amended regulations define producers as both “primary producers” and “secondary producers,” the latter including a large universe of functionaries engaging in an “activity which does not involve hiring, contracting for[,] managing, or otherwise arranging for the participation of the performers depicted.” This was challenged with respect to the original regulations in Sundance Associates, Inc. v. Reno, 139 F.3d 804 (10th Cir.1998), which held that the application of the producer requirements to “secondary producers” who engaged in an

“activity which does not involve hiring, contracting for[,] managing, or otherwise arranging for the participation of the performers depicted” exceeded the regulatory power that Congress granted the Department of Justice. The proposed, amended regulations leave the defect found in the Sundance case materially unchanged.

Requiring webmasters and others in the chain of reproduction to obtain copies of age records is of particular concern because of understandable concern about performer privacy. Most age records contain substantial private, personal identification information such as driver’s license numbers, telephone numbers, residence addresses and, perhaps, social security numbers. The more this information is shared with third parties, the greater the likelihood that the information will fall into the wrong hands, and be used for improper purposes, such as identity theft or stalking.

Additionally, many webmasters obtain content from a large number of content producers, and have invested significant resources in establishing their online presence by displaying many gigabytes of content previously licensed from third party content producers. Given the industry-wide acceptance of the Sundance decision as the law, and its prevalence as industry standard, few webmasters have obtained copies of age records from every content producer from whom they have licensed or purchased content displayed on their websites. This new requirement would mandate that webmasters seek out age records from content producers, many of whom have moved, ceased doing business, or simply disappeared since the content was purchased. Those content producers, if they can be located, normally would have little or no incentive (and, certainly, no financial incentive) to provide the requested records. The webmaster would be forced to remove the content from display even though the content has been duly licensed and appropriate records custodian disclosures appear on the website. The practical implication of this requirement would be to immediately criminalize the display of a substantial amount of First Amendment-protected material on the Internet, because of the lack of supporting records.

Suggested Remedy

The proposed regulations, 28 C.F.R. § 75.1(c)(4) should be modified to strike the words “, other than those activities identified in paragraphs (c)(1) and (2) of this section,” so that all of the activities exempted by the statute are likewise exempted by the regulations.

III.

THE EXPANDED DEFINITION OF “PRODUCER”

Section 75.1(c)(5) of the proposed regulations defines “producer” to include “any subsidiary or parent organization, and any subsidiary of any parent organization, notwithstanding any limitations on liability that otherwise would be applicable.” This

expands the burden on organizations related to the producing organization well beyond anything authorized by the statute. The scope of this definition would impose criminal liability on, for example, a far-flung corporation that does not itself engage in any publishing activities at all, if it did not itself keep, index and allow inspection of records generated by another subsidiary of the same conglomerate which was in the publishing business a half a world away.

Background

28 U.S.C. § 75.1(c) defines a producer as follows:

“Producer means any person, including any individual, corporation, or other organization, who is a primary producer or a secondary producer.”

28 U.S.C. § 75.1(c)(5) states:

“A producer includes any subsidiary or parent organization, and any subsidiary of any parent organization, notwithstanding any limitations on liability that would otherwise be applicable.”

As explained above, the definition of “secondary producer” broadly causes to be included in the definition of “producer” effectively anyone who makes any modification of the image to which § 2257 applies. Proposed § 75.1(c)(5) causes further and unjustifiable expansion of those upon whom the producer’s requirements are imposed. There are two points of comment concerning this, one practical and one legal.

From a practical standpoint, this stands to place burdens on corporations that the Department (or Congress, for that matter) could not possibly have intended. For example, in the circumstance of a conglomerate corporation with wholly owned subsidiaries in a variety of endeavors around the country and the globe, the fact that one subsidiary produces, modifies or reproduces so much as one image requiring compliance with § 2257 and its regulations would require the home office of the parent corporation and all of the subsidiaries around the world to have the mechanism to display the records at its office and for at least 5, and perhaps as many as 12, years, 10 hours every day.

Moreover, this section raises the question of whether, in the above circumstance, the statement must disclose each of the dozens of locations where the records are stored. But, so long as there is one location where the records can be found, the objective of the statute clearly is achieved.

From a legal standpoint, § 75.1(c)(5) violates the principles articulated in

Sundance more dramatically than the requirements imposed by the regulations on a

“secondary producer.” This further expansion of the “producer” definition, well beyond what § 2257 authorizes, cannot possibly pass muster in the courts.

Suggested Remedy

Delete 28 U.S.C. § 75.1(c)(5) of the proposed regulations.

IV.

OTHER REGULATIONS EXCEED STATUTORY AUTHORITY

The proposed regulations exceed the Department’s authority under the statute in additional ways. First, as with the original regulations, the proposed, amended regulations require that the disclosure statement include “the date of production, manufacture, publication, duplication, or reissuance of the matter.” Second, the proposed, amended regulations purport to partially exempt non-commercial activities. Those components of the proposed regulations exceed the authority of the statute, for much the same reasons as do the requirements imposed upon “secondary producers”, as explained above.

Background

First, 18 U.S.C. § 2257(e)(1) requires that producers affix to every copy of any material within the scope of the statute, “in such a manner and in such form as the Attorney General shall by regulations prescribe, a statement describing where the records required by this section with respect to all performers depicted in that copy of the matter may be located.” Nothing in this section either requires the producer to include in the statement anything about any date or does it authorizes the Attorney General to promulgate regulations requiring that the disclosure statement include any date. Nonetheless, 28 C.F.R. § 75.6 (a)(2) requires that every statement shall contain “the date of production, manufacture, publication, duplication, reproduction, or reissuance of the matter.” None of those dates have any bearing on where the records can be located, nor do the categories of required dates further the objectives of the statute in protecting children from involvement in the production of sexually explicit material.

Second, 18 U.S.C. § 2257(a) states that “whoever produces any book . . . or other matter which . . .” is within the purview of the statute “. . . shall create and maintain individually identifiable records . . ..” The balance of the statute defines the required conduct and prohibited conduct to “any person”, without any reference to or requirement of commercial activity, and without any exemption for non-commercial activity. Nonetheless, as proposed, 28 C.F.R. § 75.1(d) states that “sell, distribute, redistribute and re-release refer to commercial distribution” of materials covered by the statute, “but does

not refer to non-commercial or educational distribution of such matter, including transfers conducted by bona fide lending libraries, museums, schools, or educational organizations.”

The terms defined in § 75.1(d) do not appear to be operative terms anywhere in the statute or regulations such that an exemption of non-commercial would be effected by

§ 75.1(d). The terms sell, distribute, redistribute and re-release are not found elsewhere in the regulations other than in the proposed 28 U.S.C. § 75.6, which states, “The information contained in the statement must be accurate as of the date on which the book, magazine, periodical, film, videotape, computer-generated image, digital image, picture, or other matter is sold, distributed, redistributed, or rereleased.” The statute, at 18 U.S.C.

§ 2257(f)(4), defines an offense for someone to “sell or otherwise transfer, or offer for sale or transfer” any material requiring a disclosure but does not have one.

Thus, to the extent that the proposed 28 C.F.R. § 75.1(d) is an effort to exempt to some extent noncommercial activities from compliance with the requirements of the statute, it does not appear to do so. To the extent that it might create such an exemption, the statute is plainly designed to apply with equal force to noncommercial activity.

In Sundance Associates, Inc. v. Reno, 139 F.3d 804 (10th Cir. 1998), as explained above, the court addressed the issue of the extent to which 18 U.S.C. § 2257 authorized the Attorney General to promulgate regulations. In so doing, the court noted that the starting point of any analysis of the breadth of regulatory authority begins with Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). Under Chevron, the court noted,

“As an initial matter, we decide whether Congress has directly spoken to the precise question at issue. . . . If the statute is clear and unambiguous that is the end of the matter, for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. . . . The traditional deference courts pay to agency interpretation is not to be applied to alter the clearly expressed intent of Congress.” 139 F.3d at 807 (internal quotations and citations omitted).

The court went on to note that where “the text and reasonable inferences from it give a clear answer against the Government,” that is “the end of the matter.” Id. at 808.

Nothing is different here. The plain language of the statute allows the Attorney General to promulgate regulations with respect to the “form” of the “statement describing where the records . . . may be located.” It neither requires a statement concerning any date nor authorizes the Attorney General to promulgate regulations with respect to any disclosure, other than “where the records . . . may be located.” A date is a “when”, not a “where”. Congress could not have been clearer. Nor does the statute authorize the Attorney General to exempt selected activities from liability.

Suggested Remedy

28 C.F.R. § 75.6 (a)(2) should be deleted, thereby eliminating the regulatory, but not statutory requirement that the statement include “the date of production, manufacture, publication, duplication, reproduction, or reissuance of the matter.” 28 C.F.R. 75.1(d) should be deleted, eliminating any suggestion of an exemption for noncommercial activity.

V.

THE REGULATIONS UNREASONABLY REQUIRE THAT THE RECORDS BE KEPT

AT THE PRODUCERS PLACE OF BUSINESS

Although the regulations are not entirely clear on this point, the Department has consistently taken the position that the place where the records must be maintained and made available for inspection be the producer’s and custodian’s place of business. So long as the records are situated in a place where they reasonably can be inspected, there is no justification for requiring that they be at the producer’s and custodian’s place of business.

Background

With the advent of inexpensive video technology, a large, heavily capitalized organization is no longer required for the production of motion pictures, and it never has been necessary for the production of photographs. Many producers do not maintain an office, accomplishing photography at “locations” that are either a producer’s residence or leased from the locations’ owners. And to the extent that secondary producers are required to keep and index records and make them available for inspection, Web site operators are implicated, and it is well-documented that many webmasters do not maintain places of business outside of their residences.

As interpreted by the Department, the current and proposed regulations require that a producer identify a place of business – which in thousands upon thousands of instances would necessarily be the producer’s residence, for lack of any other place over which the producer has control – at which the records are located and available for inspection. As the industry understands the Department’s position, it will not approve location of the records at a commercial repository.

This has a substantially detrimental impact upon speech, given the controversial nature of this genre. By this regulation, the Department imposes – uniquely upon authors of sexually oriented speech – a requirement that a controversial speaker reveal his or her residential address on every copy of every publication. Faced with that requirement, and

without the wherewithal to maintain a commercial operation, some producers will decide simply to not go forward.

Moreover, the above-described individuals have a tendency to move their residences more often than is typical of those involved in commercial endeavors, although even the larger producers move their businesses with some regularity. The requirement that the location of the records be the producer’s place of business is thereby counterproductive to the purpose of the statute. Once the materials are in circulation, the location of the custodian of records – at the time of its release – remains affixed to the matter. If the producing business moves, particularly if it is a small one, the Department may have no way of knowing where the producer’s office has relocated, thus frustrating the ability to inspect the records.

Additionally, this requirement has an immense financial impact on publishers, especially of print or DVD media. It is common knowledge that the “setup cost” for any printed material (which would include magazines, the boxes for video tapes and the paper inserts for DVDs), as well as for DVDs, is immense. Accordingly, printed materials and DVDs normally are initially produced in sufficient numbers to anticipate all future sales. If the producer moves, the inventory of unsold copies of magazines, DVDs and boxes for videotapes becomes worthless.

Suggested Remedy

Third parties should be allowed to act as custodian of records. If the regulations were to require third-party custodians to register with the Department and to notify the Department of any change of address, the Department would be assured that inspection of the records would be possible, notwithstanding the fact that a producer relocates, dies or goes out of business. The producers, of course, would be responsible for ensuring that the third-party custodian continued in compliance.

VI.

THE DEFINITION OF “NORMAL BUSINESS HOURS” IMPOSES AN UNREASONABLE BURDEN ON PRODUCERS

In defining the time when inspections must be allowed, the time includes “normal business hours,” defined as 8:00 AM to 6:00 PM local time, and any time when the producer is conducting business. That definition imposes unreasonable burdens on producers for two reasons. First, it requires that they be open for business 10 hours per day on every day of the year, requiring the records custodian to be present for unannounced inspections during all such hours, under penalty of incarceration, without any break, meals or vacation, which may violate state and federal employment laws.⁵ Second, it requires that inspections be allowed any time the producer is conducting

⁵ Notably, the proposed regulations do not provide for designation of alternate records custodians.

business, including production, such that inspections must be allowed at the producers place of business when, for example, the producer is creating a “location” production on another continent.

Background

28 C.F.R. § 75.5(c)(1), as proposed, requires:

“Inspections shall take place during normal business hours and at such places as specified in § 75.4. For the purpose of this part, ‘normal business hours’ are from 8 a.m. to 6 p.m., local time, and any other time during which the producer is actually conducting business relating to producing depiction of actual sexually explicit conduct.”

This imposes two extremely unreasonable requirements on producers.

First, this requires that they be open for inspection 10 hours per day, 365 days per year. There is no exemption for holidays or weekends, no allowance is made for lunch breaks, and a 10-hour day is two hours longer than what is typical in American businesses, as recognized by wage-and-hour laws of many states.

Second, this requires that the producer be open for inspections any time the producer is conducting business involving production. Accordingly, for example, if a producer based in Los Angeles is filming on location in Budapest from 8:00 AM until 4:00 PM Budapest time, he would be required to keep his Los Angeles offices open from 11:00 PM until 7:00 AM to allow for an inspection because the producer is engaging in activity relating to producing.

18 U.S.C. § 2257(c) requires that a producer make the records available at “all reasonable times”. The times specified above are patently unreasonable, and thus not authorized by Congress.

All of this must take into account the fact that not all producers are large companies, and they do not necessarily produce large numbers of motion pictures or other images which are regulated by § 2257. The above regulations require the producer of a single photograph to be open for business as described above for many years after the production.

Suggested Remedy

Limit the time of inspections to days and times on which the producers in fact are open for business at the office of the custodian, requiring that the business hours be posted at the custodian’s office.

VII.

THE PROVISION ALLOWING SEIZURE OF EVDIENCE DURING AN INSPECTION EXCEEDS STATUTORY AUTHORITY AND IS CONTRARY TO THE LAW

Inspectors, who can be anyone designated by the Attorney General, are generally granted broad authority to seize any evidence of the commission of any felony during the course of an inspection. Evidence of a felony could include evidence of violation of an obscenity statute, and seizure of media materials under those circumstances without a judicial determination of obscenity would offend the First Amendment. Moreover, this provision runs afoul of the established Fourth Amendment principles relating to searches and seizures. Finally, there is no limit to what the inspectors can copy, thus allowing the Department to require the producers to produce exactly the type of membership lists that the Supreme Court has held protected.

Background

As proposed, § 75.5(g) of the regulations, Inspection of Records, states: “(g) Seizure of evidence. Notwithstanding any

provision of this part or any other regulation, a law

enforcement officer may seize any evidence of the commission of any felony while conducting an inspection.”

The plain language of this proposal is extraordinarily broad, and is objectionable for a variety of reasons, especially when taken along with other regulations.

First, the term “law enforcement officer” is not defined anywhere in the proposed regulations or the underlying statute. A private citizen, not otherwise a law enforcement officer, who is deputized as an “inspector” by the Attorney General pursuant to § 75.5(a) of the proposed regulations could be said to be a “law enforcement officer” by virtue of that designation, alone. The proposed regulations certainly do not preclude such an interpretation.

Moreover, restricting the definition of “law enforcement officer” to someone who under some law is deemed a “law enforcement officer” of any variety does not necessarily limit to appropriately qualified personnel the class of persons who can exercise the broad seizure power granted by this proposed section. While every state presumably has standards for training and certification of law-enforcement personnel, those standards do not guarantee that a given inspector will be properly trained. For example, WIS. STAT. § 165.85(4)(b) excepts from much of the training and certification requirements law enforcement officers serving on a temporary or probationary basis. See

Kraus v. City of Waukesha Police and Fire Com’n., 261 Wis.2d 485, 497, 662 N.W.2d 294 (2003). And lack of qualification of the inspector may not provide any protection for the subject of the inspection. For example, in Barnes v. State, 305 Ark. 428, 810 S.W.2d 909 (1991), the Arkansas Supreme Court held that failure to meet Arkansas’ statutory law enforcement standards does not invalidate actions taken by law enforcement officers, in that case warrantless arrests.

Even assuming appropriately qualified inspectors, this proposal is riddled with potential violations of the Constitution. The most significant is that violation of any federal anti-obscenity law is a felony, e.g., 18 U.S.C. §§ 1461, 1462, 1465 and 1466, as is violation of the obscenity laws of many states, e.g., OKLA. STAT. ANN. TITLE 21 § 1021 and N.D. CENT. CODE § 12.1-27.1-01, including some states that define the offense as a felony, notwithstanding the fact that the punishment is more akin to that generally associated with a misdemeanor. E.g., ARIZ. REV. STAT. § 13-3502, LA. REV. STAT. ANN.

§ 14:106 and OHIO REV. CODE ANN. § 2907.32. Moreover, of course, violation of 18

U.S.C. § 2257 itself is a felony. Accordingly, this proposed regulation authorizes an inspecting law-enforcement officer to seize an extraordinarily broad array of evidence items.

Most striking is the authorization concerning obscenity offenses. The Supreme Court has long held that a prior restraint of speech cannot be brought about absent appropriate procedural safeguards. As explained in New York v. P.J. Video, Inc., 475 U.S. 868, 106 S.Ct. 1610, 89 L.Ed.2d 871 (1986):

“We have long recognized that the seizure of films or books on the basis of their content implicates First Amendment concerns not raised by other kinds of seizures. For this reason, we have required that certain special conditions be met before such seizures may be carried out. In Roaden v. Kentucky, 413 U.S. 496, 93 S.Ct. 2796, 37 L.Ed.2d 757 (1973), for example, we held that the police may not rely on the ‘exigency’ exception to the Fourth Amendment’s warrant requirement in conducting a seizure of allegedly obscene materials, under circumstances where such a seizure would effectively constitute a ‘prior restraint.’ In A Quantity of Books v. Kansas, 378 U.S. 205, 84 S.Ct. 1723, 12 L.Ed.2d 809 (1964), and Marcus v.

Search Warrant, 367 U.S. 717, 81 S.Ct. 1708, 6 L.Ed.2d 1127 (1961), we had gone a step farther, ruling that the large-scale seizure of books or films constituting a ‘prior restraint’ must be preceded by an adversary hearing on the question of obscenity. In Heller v. New York, 413 U.S. 483, 93 S.Ct. 2789, 37 L.Ed.2d 745 (1973), we emphasized that, even where a seizure of allegedly obscene materials would not constitute a ‘prior restraint,’ but instead would merely preserve evidence for trial, the seizure must be made

pursuant to a warrant and there must be an opportunity for a prompt postseizure judicial determination of obscenity. And in Lee Art Theatre, Inc. v. Virginia, 392 U.S. 636, 88 S.Ct. 2103, 20 L.Ed.2d 1313 (1968), we held that a warrant authorizing the seizure of materials presumptively protected by the First Amendment may not issue based solely on the conclusory allegations of a police officer that the sought-after materials are obscene, but instead must be supported by affidavits setting forth specific facts in order that the issuing magistrate may ‘focus searchingly on the question of obscenity. Marcus, supra, at 732, 81 S.Ct., at 1716; see also Stanford v. Texas, 379 U.S. 476, 486, 85

S.Ct. 506, 512, 13 L.Ed.2d 431 (1965).” 475 U.S. at 873-

74.

The proposed regulation fails to take the above into account. For example, if an inspecting law-enforcement officer personally believes that a particular motion picture is obscene, although it never has been so adjudicated, this regulation allows the officer, upon reviewing the copy of it that is required to be kept with the records pursuant to the proposed § 75.2(a)(9)(i), to seize, with no warrant, every copy of the motion picture, along with any document constituting evidence of the operation of the production company involved in its distribution. As noted above, a warrant authorizing the very same seizure would be held invalid under the special constitutional protections afforded to expressive material. In another example, if while inspecting an Internet company an inspecting law-enforcement officer found in the records a depiction that the officer personally regarded as obscene, the inspector by this regulation is authorized to seize the computer that is disseminating the Web site, along with any records that evidence the operation of the Web site.

It is not only obscenity offenses that are problematic. Similar drastic consequences are authorized where an inspecting officer, for example, in reviewing the records of a particular performer for compliance with these regulations, finds that the records omit one of the stage names that the inspector remembers that the performer had used, there is little limit as to what the officer could seize in an effort to demonstrate that the omitted stage name was known to the producer. To the extent that records are kept and indexed on a computer – which is effectively required because of the extensive indexing requirements of proposed §§ 75.2(a)(3) and (d) and 75.3 – the officer’s observation of a single violation of these regulations, no matter how technical, would authorize the seizure of at least the computer and all backup files, as well as any paper records that might evidence anything about the operation of the subject business. Seizure of every copy of a producer’s records that are kept as required by these regulations not only places a producer in the untenable position of being unable to comply with the statute for want of records, it also has the effect of preventing the producer from, for example, continuing to operate the producer’s Web site or selling motion pictures, neither of which can be done without the infrastructure to comply with these regulations. This is akin to seizing the projector from a movie theater, a practice that has been universally

condemned by the courts as an unlawful prior restraint of speech, back when local police departments occasionally would engage in such tactics. E.g., Maguin v. Miller, 433 F.Supp. 223 (D. Kan. 1977) and Bongiovanni v. Hogan, 309 F.Supp. 1364, 1366 (S.D.N.Y. 1970); see also Southland Theatres, Inc. v. Butler, 350 F.Supp. 743, 745 (W.D. Tex. 1972)(return of the projectors was ordered.). More to the point, even if one of the films eventually were to be adjudicated obscene, the business cannot be closed as a consequence, regardless of procedural safeguards, Vance v. Universal Amusement Co., Inc., 445 U.S. 308, 100 S.Ct. 1156, 63 L.Ed.2d 413 (1980), much less on the inspecting officer’s personal conclusions alone with no judicial intervention.

Additionally, this broad provision runs afoul of established, constitutional limits on search and seizure. Assuming arguendo that law-enforcement officer inspector is properly entitled to conduct an inspection according to these regulations, the inspector’s broad authority that would be authorized by this seizure proposal runs afoul of established rules concerning search and seizure. The effect of this regulation, as proposed, fails the requirement that administrative searches be “carefully limited in time, place, and scope.” New York v. Burger, 482 U.S. 691, 702, 107 S.Ct. 2636, 96 L.Ed.2d

601 (1987), citing United States v. Biswell, 406 U.S. 311, 315, 92 S.Ct. 1593, 32 L.Ed.2d 87 (1972). Viewed another way, “if contraband is left in open view and is observed by a police officer from a lawful vantage point, there has been no invasion of a legitimate expectation of privacy and thus no ‘search’ within the meaning of the Fourth Amendment

– or at least no search independent of the initial intrusion that gave the officers their vantage point.” Minnesota v. Dickerson, 508 U.S. 366, 375, 113 S.Ct. 2130, 124 L.Ed.2d 334 (1993). And “if police are lawfully in a position from which they view an object, if its incriminating character is immediately apparent, and if the officers have a lawful right of access to the object, they may seize it without a warrant.” Id. at 374. This proposed regulation ignores the caveats established by these cases. Nothing in the regulation at all limits the scope of the search or confines that which can be seized to either what is incidental to the search or what is of immediately apparent incriminating character. If the evidence of commission of a felony is found in the records themselves, those records can be copied pursuant to § 75.5(e) and according to the recent amendments to the underlying statute, used against the business maintaining the records.

As a last point with respect to seizure, all of the wrongs that would be authorized should this provision be adopted are exacerbated by the Department’s requirement that the records be kept and made available for inspection at the producer’s/custodian’s place of business which, in the case of an increasingly large number of producers, means the producer’s residence. The prohibition against third-party custodians, which has been the Department’s consistent position, allows the law-enforcement inspectors to engage in this intrusive search and seizure activity in a producer’s residence. The home has consistently been afforded the highest level of constitutional protection against unreasonable searches and seizures by the courts.

Finally, § 75.5(e) allows the inspectors without any limitation to copy “any” record subject to inspection. The absence of limitation allows the inspectors to copy every record subject to inspection, which means every record of every depiction that the

producer has made since the effective date of these regulations. The impact of this is to allow the Department to amass a database about every performer involved in these productions. There is no need for the Department to create a database of performers’ records merely to satisfy its idle curiosity. This proposed regulation allows the Department to do indirectly that which it cannot do directly, which is to force the industry to produce the functional equivalent of membership lists of people engaged in constitutionally protected (albeit controversial) activity. The Supreme Court long ago rejected such a practice. National Ass’n. for Advancement of Colored People v. State of Alabama ex rel. Patterson, 357 U.S. 449, 78 S.Ct. 1163, 2 L.Ed.2d 1488 (1958).

Suggested Remedy

Delete proposed § 75.5(e), and limit § 75.5(g) to copying at no expense to the producer, rather than seizure.

VIII.

EXEMPTIONS FROM THE BURDENS IMPOSED ON “PRODUCERS” SHOULD ADDITIONALLY INCLUDE PRINTERS, AS WELL AS WEB HOSTS, DUPLICATORS OF VIDEOTAPES, DVDS, AND OTHER MEDIA

Apart from the fact that a mere printer, video duplicator, DVD replicator or duplicator of other media must be excluded from the requirements imposed upon producers because to do otherwise would exceed statutory authority according to the Sundance case, supra, there is no practical need for those entities to be subject to the requirements imposed upon producers. Nevertheless, both the original regulations and the proposed new ones broadly impose such burdens upon printers and the like. Moreover the failure to exclude “printers, film processors, and video duplicators whose sole function is to provide similar services to a producer” fails to take into account the holding in American Library Ass’n. v. Reno, 33 F.3d 78, 94 (D.C. Cir. 1994), invalidating the statute and regulations to the extent that they apply to those functions.

Background

The proposed regulations include a definition of “producer” that includes a “secondary producer”, which would include printers, videotape duplicators, DVD replicators and, but for the express exception in proposed § 75.1(c)(4)(i), photo processors. In American Library Ass’n. v. Reno, 33 F.3d 78, 94 (D.C. Cir. 1994), the court addressed this issue:

“The next objection concerns the inclusion within the definition of ‘secondary producers’ of persons who duplicate or reproduce sexually explicit materials that are

intended for commercial distribution. 28 C.F.R. § 75.1(c)(2). Appellees [challenging the regulations] point out that such persons include printers, film processors, and video duplicators whose roles are functionally indistinguishable from that of photo processors, who are specifically excluded from the definition of ‘producer.’ See

. . . § 75.1(c)(4)(i). As we understand the photo processing exception, it applies to persons to whom a producer delivers films for development or the making of prints and who, on completing their work, return the films and prints to the producer. The Government does not explain what interest is served by according different treatment to printers, film processors, and video duplicators whose sole function is to provide similar services to a producer. We agree, therefore, that the Act does not apply to persons who perform such services and return their work product to the producer who employed them.”

The regulations should respect the decision of the court on this point. Moreover, those who perform solely those functions are engaged in “activity which does not involve hiring, contracting for[,] managing or otherwise arranging for the participation of the performers depicted.” Accordingly, the Sundance case, supra, likewise prohibits imposing producer requirements on those engaged in the above functions.

Suggested Remedy

At the very least, § 75.1(c)(4) of the proposed regulations should be altered to specifically exclude from the definition of “producer” those “persons who perform only duplication services, and return their work product to the producer who employed them.” More appropriately, the entire holding of the Sundance case should be embraced.

IX.

THE REQUIREMENTS CONCERNING

THE SIZE AND LOCATION OF THE STATEMENT ARE UNREASONABLE IN MANY RESPECTS

When evaluated in the context of real-world publications of magazines, motion pictures and Web sites, the regulations concerning the size and location of the required statement are sometimes overly burdensome in some instances, vague in others and, in still others, do not make practical sense or reasonably further any legitimate purpose of the statute. The requirement that the typeface of the statement be at least as large as the largest typeface of the performers, director, producer, or owner, for example, likely would require the typeface of the statement in a magazine be the same size as the title,

which might easily be 100-200-point. Likewise, with respect to a motion picture, a title screen of a motion picture often names the producer in a typeface equal to the title which, again, would cause the typeface for the statement to be very large. Further, the minimum requirement of 11-point type on a videotape, DVD or Web page is immeasurable because the typeface of the statement is a function of the screen dimensions and settings of the monitor on which the material is viewed.

Background

Section 75.6(e), as proposed, requires that the statement be in the type size at least as large as the largest used to identify a performer, director, producer or owner, or in any case no smaller than 11-point-type, in black and white, un-tinted background. However, the 11-point-type requirement is meaningless in the context of cyberspace. The type display size will depend on the size of the monitor and/or chosen screen dimensions. Most Windows-based programs for example, allow for modification of screen size with a click of a mouse, which consequently modifies the type size of all text. Reference to any type size is illogical as it pertains to digital display. The same is true for video media, where the size of the typeface is a function of the size of the video monitor on which the matter is viewed.

Moreover, requiring the disclosure to be in a size equal to the largest used to identify a performer, director, producer or owner is overly burdensome, and amounts to forced speech that significantly impacts the message being conveyed in the media. Many adult-oriented websites use the name of the performer as the title of the website, which is often in very large type, which is typical of titles in any form of media. Requiring the disclosure to be in the same sized type as the title, forces the webmaster to substantially reduce the title size, or provide for a disclosure in huge letters, taking up many web pages of space.

With respect to many magazines, the title is often the name of the owner or producer. Titles, of course, are invariably in a very large typeface. The unreasonableness of a requirement of a statement in 144-point type, for example, is obvious. Similarly, the star performer in a motion picture or its producer often appears above the title and in an equally large typeface. This creates an equally unreasonable regulation.

Finally, the requirement that the type be “black on white, untinted background” is unreasonable. Many web pages use templates for their creation, wherein each page is the same color throughout the website. Requiring the first page to be white, with black type, could require substantial redesign of entire websites, merely to comply with the disclosure requirement. Such requirement would also potentially interfere with the theme and message sought to be conveyed by imposing artistic and editorial control on webmasters under penalty of fine and incarceration.

Suggested Remedy

Require only that the disclosure to be plainly viewable by the reader, thereby allowing the publisher or webmaster to choose the size of the text, along with the theme and color of the background.

X.

WITH RESPECT TO DVDS AND COMPARABLE MEDIA, THE LOCATION OF THE STATEMENT SHOULD BE SPECIFIED

DVDs were not in existence at the time the original regulations were promulgated, they are not considered by the proposed, amended regulations and, as they now are likely the most popular means of distribution of motion pictures, should be addressed by the regulations. Given the mechanism by which DVDs operate, it would be entirely consistent with the stated purpose for the statute to allow the statement to appear either on the opening screen or, in the alternative, on a conspicuous screen accessible from the opening screen.

Background

The required location of the statement is defined by the proposed regulations as follows:

Ҥ 75.8 Location of the statement.

“(a) All books, magazines, and periodicals shall contain the statement required in § 75.6 or suggested in §

75.7 either on the first page that appears after the front cover or on the page on which copyright information appears.

“(b) In any film or videotape that contains end credits for the production, direction, distribution, or other activity in connection with the film or videotape, the statement referred to in § 75.6 or § 75.7 shall be presented at the end of the end titles or final credits and shall be displayed for a sufficient duration to be capable of being read by the average viewer.

“(c) Any other film or videotape shall contain the required statement within one minute from the start of the film or videotape, and before the opening scene, and shall

display the statement for a sufficient duration to be read by the average viewer.

“(d) A computer site or service or Web address . . ..

“(e) For all other categories not otherwise mentioned in this section, the statement is to be prominently displayed consistent with the manner of display required for the aforementioned categories.”

Other than the addition of vague requirements for locating the statement on Web pages (addressed elsewhere), this regulation, as proposed, would remain unchanged. DVDs are eclipsing videotapes as the preferred medium for prerecorded motion pictures. The functionality of DVDs is different from videotapes in that the latter, like motion picture film, is simply played from beginning to end (videotapes having the additional fast-forward and fast-reverse functions). DVD technology allows that functionality, but the more popular format allows a “home” screen, allowing the viewer to choose from various functions, such as out-takes, previews of other motion pictures, interviews with the performers or the director, jumping to a particular point in the motion picture (to allow resumption of viewing after only viewing part of the motion picture), along with simply playing the motion picture from start to finish. The purposes of the statute could be served completely if the regulations allowed one of the selections on the “home” screen to direct the viewer to the disclosure required by the statute.

Additionally, the proposed regulations are perplexing in some circumstances with respect to DVDs. For example, a DVD could contain more than one motion picture, with a home screen allowing the viewer to select from two or more that are available. Other DVDs have one motion picture available in multiple languages or varying screen formats. It is not clear from the regulations where the disclosure should be situated, on the home screen, at the beginning of the motion picture selected from the home screen, or along with the end credits found at the end of the motion picture(s).

Suggested Remedy

Add a subsection to § 75.8 specifying where the statement should be placed on a DVD. The most practical and reasonable method would give the producer the option of either placing the statement on the first screen displayed or, alternatively, displaying it on a screen that can be selected from the first screen displayed.

XI.

THE REQUIREMENT WITH RESPECT TO THE LOCATION OF THE STATEMENT IN MOTION PICTURES AND VIDEOTAPES

IS UNREASONABLE

Both as written and according to the proposed, amended regulations, the statement with respect to motion pictures and videotapes is required to be at the beginning of the tape unless there are end titles or end credits to the motion picture, in which case the statement must be associated with the end credits. Since “end credits” and “end titles” can be ambiguous in the context of current videotapes, the producer should always be given the option of placing the statement at the beginning of the videotape or motion picture.

Background

For reasons that never have been made clear, the regulations as originally promulgated and as now proposed require that the statement on motion pictures be at the beginning of the motion picture but, if there are end titles or credits, with them, then the statement must be associated with them:

“(b) In any film or videotape that contains end credits for the production, direction, distribution, or other activity in connection with the film or videotape, the statement referred to in § 75.6 or § 75.7 shall be presented at the end of the end titles or final credits and shall be displayed for a sufficient duration to be capable of being read by the average viewer.

“(c) Any other film or videotape shall contain the required statement within one minute from the start of the film or videotape, and before the opening scene, and shall display the statement for a sufficient duration to be read by the average viewer.” 28 C.F.R. § 75.8(b-c).

From the standpoint of producers, this regulation is onerous because some statements at the conclusion of a motion picture may or may not consist of an “end title” or “end credit”, depending upon how those terms are interpreted. For example, if at the conclusion of the motion picture there is a copyright notice identifying the producer, is that an “end credit”? Is one “credit” sufficient to require that the disclosure be at that point, or must there be more?

Suggested Remedy

28 C.F.R. § 75.8(b-c) should be combined and modified to state,

“Any film or videotape shall contain the required statement within one minute from the start of the film or videotape, and before the opening scene, and shall display the statement for a sufficient duration to be read by the average viewer. If the film or videotape has one or more end titles or end credits, the required statement may, instead or in addition, follow the final end title or end credit.”

XII.

THE REQUIREMENTS THAT THE REQUIRED RECORDS BE ENTIRELY SEGREGATED FROM ALL OTHER RECORDS AND NOT CONTAIN ANY OTHER RECORDS ARE AT ODDS WITH THE PURPOSE OF THE ACT AND PLACE AN UNNECESSARY BURDEN ON THE RECORD KEEPER

The proposed regulations require that the required records be entirely segregated from and not contain any records other than those required to be maintained under the statute and regulations. While producers as a general matter would be expected to segregate required records simply to protect the integrity of trade secrets and other confidential information, an absolute ban on commingling any non-required records prevents, for example, inclusion of a copy of a second form of identification or additional information that would be helpful in locating performers.

Background

28 CFR § 75.2(e), as proposed, says, “Records required to be maintained under this part shall be segregated from all other records, shall not contain any other records, and shall not be contained within any other records [emphasis added].” While technically feasible, conforming to this regulation is extremely impractical. As proposed, the regulation essentially defines as a felony including one item of information not required by the statute and regulations. This, for example, would prohibit the careful producer from retaining copies of additional identification documents or information that would assist in locating the performer. All of that runs counter to a stated purpose of the statute and regulations, to identify performers who may have been photographed when underage.

There are legitimate business reasons for generally segregating the required records from a producer’s general business records. To do otherwise would cause inspections to be disruptive to the producer’s business operation. Additionally, commingling records could give inspectors access to trade secrets and other sensitive information that should not be public. Thus, this proposed regulation is not necessary.

Indeed, in articles written about the subject, lectures and legal advice given to producers, attorneys for the industry have uniformly advised producers to keep records required by these regulations segregated from other company records. Almost uniformly, producers are following this practice with no known exceptions.

A practical problem created by this requirement which results in it being unreasonable arises from the use of a computer to keep the records, which is effectively mandated for all but the smallest producers because of the indexing requirements of §§ 75.2(a)(3), 75.2(d) and 75.3. Even assuming that the producer uses a computer with no information stored on it other than records required by these regulations, those records are not entirely segregated from each other because they all are found on the same storage device (e.g., hard disk); and the computer must contain other data, such as executable programs, cache files, and so on.

Suggested Remedy

Delete 28 CFR § 75.2(e). Alternatively, modify it to require that the records “should be segregated from materially all other records, shall not contain any unrelated records . . . ,” and to take into account the reality that records often will be kept on computers.

XIII.

THE REGULATIONS IMPOSE UNREASONABLE AND VAGUE REQUIREMENTS UPON OPERATORS OF WEB SITES

Section 75.2(a)(1)(ii), as proposed, requires that the records must include “where the depiction is published on an Internet computer site or service, a copy of any URL associated with the depiction.” This requirement is vague, and subject to misinterpretation, and inadvertent noncompliance. The regulations must clarify what information, exactly, must be included with the depiction in terms of a URL or domain name, and limit it so as to be reasonable.

Background

According to The American Heritage® Dictionary of the English Language (Houghton Mifflin 4th ed. 2000), “URL means:

“An Internet address (for example, http://www.hmco.com/trade/), usually consisting of the access protocol (http), the domain name (www.hmco.com), and optionally the path to a file or resource residing on that server (trade).”

Thus, even according to a recognized lexicon, “URL” is a vague term. For example, using the above, simply a copy of the letters “http://www.hmco.com/trade/” may or may not be in compliance. Or, again using the above, a photocopy of what appears on http://www.hmco.com/trade/ may, or may not, be compliant. But the language of the proposed regulation, requiring a copy of “any URL associated with the depiction,” could easily be interpreted to include a copy of every page on the entire Web site on which the image is published. Thus, another interpretation, using the above example, would require all of the pages associated with http://www.hmco.com/ to be recorded, which would be the entire Web site. Many of them include hundreds or thousands of pages and images.

Assuming the webmaster could determine which “URL” to copy (unless it were limited to simply the URL address, e.g., http://www.hmco.com/trade/), the webmaster is next faced with the dilemma arising from the fact that, unlike print and motion picture media, Web pages regularly change, some every day. For example, materially every major newspaper – and for that matter, most every non-major news publications – has an “online edition”, the content of which changes at least at the rate of publication (i.e., daily, weekly, etc.), and often hourly. Adult entertainment Web sites are no different, updating content on a regular basis. Thus, this regulation may leave webmasters with the daunting and unacceptably burdensome task of changing all of the required records every time a Web page is changed.

Arguably, however, the above requirement, as written, requires only a copy of the URL at the time the record is made, and does not require updating. If that is the case, then this is duplicative of the preceding requirement that the records include “a copy of the depiction.”

Finally, imposing the burden of continuously updating the copy of the URL serves no purpose sufficient to justify that burden. The presumed purpose of it, to allow inspectors to correlate the performers with the depictions, is not furthered by requiring continuous updating of the records in that regard.

Suggested Remedy

Eliminate § 75.2(a)(1)(ii).

THE REQUIREMENT OF INCLUDING A COPY OF THE DEPICTION IS VAGUE AND OVERLY BURDENSOME

Section 75.2(a)(1)(i) requires that a “copy of the depiction” be kept with the age records pertaining to all content subject to the requirements of § 2257. The requirement is vague and overly burdensome.

Background

In the context of traditional media, compliance with this requirement means that a copy of an entire motion picture or magazine be in the file along with the balance of each of the performer’s records. This serves no purpose, so long as the depiction is adequately identified. The regulations already require a copy of an identification card containing the performer’s photograph, along with records identifying the material(s) in which the performer is depicted. Thus, faced with the need to verify that a particular performer appeared in a motion picture or magazine in question, the records already identify the motion picture or the issue of the magazine in which the performer can be found, along with a photograph of the performer found on the identification document. Thus, this requirement is duplicative.

The requirement also is particularly burdensome. To the records already required, this adds that a copy of the material be associated with each performer depicted in it. Thus, for example, if a publisher produced a magazine depicting 50 individuals, the publisher would be required to cram 50 copies of the magazine in with its records – for each month, assuming a monthly publication. The problem is magnified with respect to videotapes, and particularly motion pictures recorded on traditional film (a print of a typical motion picture feature length film consumes one or two cubic feet of space).

Of particular concern would be streaming video that changes from day to day, even hour to hour. It would be a near impossibility for a webmaster to keep a “copy” of digital media generated from a camera that may be running as much as 24 hours per day in one of the many “voyeur rooms” or “voyeur houses” available for access online.

In sum, this requirement serves little or no useful purpose, but is extraordinarily burdensome on publishers.

Suggested Remedy

Eliminate § 75.2(a)(1)(i-ii).

CATEGORIZATION REQUIREMENT

Sections 75.2(a)(3), 75.2(d) and 75.3 require that all records be retrievable in the following manners: 1) alphabetically; 2) numerically; 3) by legal name; 4) by alias; 5) by maiden name; 6) by nickname; 7) by stage name; 8) by professional name; 9) by title; 10) by number; 11) by “similar identifier of the media.” This is unreasonably burdensome on producers. Moreover, as proposed, the amended regulations would set forth indexing requirements in three places, §§ 75.2(a)(3), 75.2(d) and 75.3. The addition of § 75.2(d), to the extent that it is not duplicative of what already is found in §§ 75.2(a)(3) and 75.3 is unreasonable, particularly if applied to secondary producers.

Background

As proposed, 28 C.F.R. § 75.2(a)(3) states:

“(3) Records required to be created and maintained under this part shall be organized alphabetically, or numerically where appropriate, by the legal name of the performer (by last or family name, then first or given name), and shall be indexed or cross-referenced to each alias or other name used and to each title or identifying number of the book, magazine, film, videotape, computer- generated image, digital image, picture, URL, or other matter.”

The above is identical to the existing regulations, except that it adds “computer- generated image, digital image, picture, URL,” which is not a material change given the “or other matter” language, a catch-all that would have included computer-generated images in any event (assuming that they are images of actual persons⁶). The same is true with respect to § 75.3, which, as proposed, would provide:

“Records required to be maintained under this part shall be categorized alphabetically, or numerically where appropriate, and retrievable to: All name(s) of each performer, including any alias, maiden name, nickname, stage name, or professional name of the performer; and according to the title, number, or other similar identifier of each book, magazine, periodical, film, videotape, computer-generated image, digital image, picture, or other

⁶ The industry always has assumed – and there is no reason to believe otherwise – that § 2257 does not apply to visual depictions that are not of actual persons, given that it would be impossible to have an “identification document” for other than a natural person. Moreover, actual sexually explicit conduct can only take place between actual, natural persons.

matter. Only one copy of each picture of a performer’s picture identification card and identification document must be kept as long as each copy is categorized and retrievable according to any name, real or assumed, used by such performer, and according to any title or other identifier of the matter.”

Notwithstanding the above, comprehensive indexing requirements, the proposed, new regulations add a third indexing requirement, largely duplicative of the first ones:

“(d) For any record created or amended after [insert date 30 days after publication of the final rule in the Federal Register], all such records shall be organized alphabetically, or numerically where appropriate, by the legal name of the performer (by last or family name, then first or given name), and shall be indexed or cross- referenced to each alias or other name used and to each title or identifying number of the book, magazine, film, videotape, computer-generated image, digital image, picture, or other matter (including but not limited to Internet computer site or services). If the producer subsequently produces an additional book, magazine, film, videotape, computer-generated image, digital image, or picture, or other matter (including but not limited to Internet computer site or services) that contains one or more visual depictions of actual sexually explicit conduct made by a performer for whom he maintains records as required by this part, the producer shall add the additional title or identifying number and the names of the performer to the existing records and such records shall thereafter be maintained in accordance with this paragraph.”

First, it makes no sense to include three subsections that address indexing of records. And to the extent that this new section adds anything, either legally or in practice, to the existing requirements of §§ 75.2(a)(3) and 75.3, it is unimaginable that it is necessary. Indeed, the requirements are unduly burdensome as they exist.

In practice, the indexing requirement for the most part accomplishes little. If it is necessary to determine the date of birth of a performer, that can be accomplished with little indexing. So long as the records, for example, associated with the performers in a particular motion picture or magazine list the actual names of those depicted therein, the inspector can turn to the records concerning the particular performers. Otherwise, the burden of the required indexing is not justified by what it might accomplish. Most performers who appear in multiple motion-picture productions, multiple magazines or multiple Web sites, work for many producers. And since the indexing is on a producer- by-producer basis, if the objective of the indexing is to locate other places that a

particular performer has appeared, the most cursory search of the Internet is likely to produce profoundly more useful information.

Worse, if this requirement is allowed to apply to secondary producers, materially every adult Web site displaying images to which § 2257 applies will be required to create a computer database which likely will be more costly than is the operation of the site.

Suggested Remedy

Delete 28 C.F.R. §§ 75.2(d) and 75.3, and modify 28 C.F.R. § 75.2(a)(3), limiting the mandated indexing to a requirement that the records associated with any motion picture, magazine, or Web site include the actual names of all relevant performers or models⁷ depicted therein.

XVI.

THE SEVEN-YEAR REQUIREMENT

Section 75.4 requires that the records be maintained for seven (7) years from the last amendment to the record. This is unreasonable, and contrary to the decision of the United States Court of Appeals for the District of Columbia Circuit.

Background

In American Library Ass’n. v. Reno, 33 F.3d 78 (D.C. Cir. 1994), the Court held that the open-ended requirement in the present regulation was unreasonable, rendering a saving construction:

“Pending its replacement by a provision more rationally tailored to actual law enforcement needs, we will accept a period of five years as reasonable. We do so because it conforms with both the five-year statute of limitations applicable to the Act, 18 U.S.C. § 3282 (1988), and the minimum period recommended by the Pornography Commission.” Final Report⁸ at 621.” Id. at 91.

⁷ There may be portions of, for example, a motion picture or a magazine that do not contain any visual depiction of actual sexually explicit conduct. Accordingly, there need not be any records with respect to the performers depicted in those scenes so long as they are not in other scenes depicting actual sexually explicit conduct. A good example of this is an advertisement in a magazine, where the advertisement contains no depiction of actually sexually explicit conduct, but such depictions are found elsewhere in the issue.

⁸ Attorney General’s Commission on Pornography, Final Report (1986)

There is no justification for requiring that records be retained for more than five

(5) years. Nor is there justification for the requirement later in § 75.4 that the records be kept for five (5) years after the dissolution of the relevant organization. In total, § 75.4 can require that a record be retained as long as 12 years after its last amendment.

Suggested Remedy

Re-write the regulations to state that, notwithstanding any other requirement of these regulations, records need not be retained more than 5 years after the making of the depiction.

XVII.

THE SELLER’S ACCURACY BURDEN

Section 75.6(d) requires that “[t]he information contained in the statement must be accurate as of the date on which the [material] . . . is sold, distributed redistributed, or re[-]released.” 18 U.S.C. § 2257(f)(4), in turn, defines a felony criminal offense for selling or transferring materials covered by the statute and regulations without “a statement describing where the records required by this section may be located.” As written, the regulation could be construed to prohibit a wholesale or retail distributor from selling materials with an outdated statement, notwithstanding the statutory caveat that “such person shall have no duty to determined [sic] the accuracy of the statement or the records required to be kept.”

Background

In interpreting § 2257 and the current regulations, the court in American Library Ass’n. v. Reno, 33 F.3d 78 (D.C. Cir. 1994) found that the requirement that the statement be accurate as of the date of sale, etc., could not be applied to re-sellers:

“On its face, the regulations’ updating requirement would reach wholesale and retail transactions that lie entirely beyond the scope of the Act. See id. at § 75.1(d) (defining ‘sell, distribute, redistribute, and re[-]release’ to include ‘commercial distribution of a book, magazine, periodical, film, videotape, or other matter’ covered by the Act). The Act, however, imposes the obligation to keep records and affix statements only on those who ‘produce[ ] any book, magazine, periodical, film, videotape, or other matter which . . . contains . . . depictions . . . of actual sexually explicit conduct,’ 18 U.S.C. § 2257(a)(1); and it defines ‘produces’ to mean ‘produce, manufacture, or publish any

[such material] . . . and includes the duplication, reproduction, or reissuing of any such matter.’ Id. § 2257(h)(3). Because the Act does not apply to those solely engaged in the sale of these items, its requirements may not be imposed on them. The Act cannot be read to require a magazine vendor, for example, to revise the statement in a pornographic periodical ‘as of the date on which [it] is sold’ to a consumer.” Id. at 93.

The proposed regulations ignore the above.

Suggested Remedy

Modify § 75.6(d) to require only that “[t]he information contained in the statement must be accurate as of the date on which the [material] . . . is sold, distributed redistributed, or re-released by the primary producer.”

XVIII.

THE BURDEN OF VERIFYING PERFORMERS’ ALTERNATIVE NAMES

Section 75.2(a)(2) requires that the producer obtain from the performer “any name, other than each performer’s legal name, ever used by the performer, including the performer’s maiden name, alias, nickname, stage name, or professional name.” Arguably, this requires some variety of verification from the performer, although the Department has taken the position that the producer need only inquire of the performer and accept as true the performer’s response. The regulations, as written and as proposed, if construed literally would hold the producer responsible for the difficult task of verifying the accuracy of each of the names given by the performer and the impossible task of insuring that the performer did not omit any name.

Background

A statement of a person’s family history, which would include a name maiden name or a nickname, is a recognized exception to the hearsay rule. E.g., FED. R. EVID. 804(b)(4). If there is not a dispute at the time, legal scholars tell, it can be considered sufficiently trustworthy that it is admissible. If there is an issue of trustworthiness, as may be the case in this instance as to the performer’s identity or date of birth, it does not apply. Thus, the requirement that the producer examine an identification document is not unreasonable (at least whether the performer is over 18 years of age might be called into question). However, a statement of someone’s maiden name or nickname has no lack of indicia of trustworthiness. Producers should be allowed to take the performer’s word for those facts.

More fundamentally, however, is that there is usually no other source. Unlike a person’s legal name, which can be verified – more or less – by documents such as drivers’ licenses, there is no source for verification that a list, for example, of stage names is complete. If, for example, a producer knows that a performer has a stage name that the performer did not list, failure to include that name in the records likely would violate

§ 2257(f)(2). But a producer cannot determine the negative. If a performer has used a particular stage name, but fails to reveal it to the producer, it is unfair to hold the producer responsible

Suggested Remedy

Add to § 75.2(a)(2) a caveat, similar to that found in § 2257(f)(4), that the producer “shall have no duty to determine the accuracy of the performer’s representations beyond examining the required identification document.”

XIX.

THE IDENTITY OF INSPECTORS AND THEIR CREDENTIALS MUST BE ADDRESSED IN REGULATIONS

The regulations permit the Department to appoint inspectors on an ad hoc basis. Moreover, there are no standards for inspectors, so the Department can appoint as inspectors anyone ranging from private censorship groups to convicted felons. Additionally, there is nothing found in the proposed regulations establishing any identification cards or credentials for the inspectors, leaving producers prey to imposters.

Background

Proposed 28 U.S.C. § 75.5(a) states:

“(a) Authority to inspect. Investigators designated by the Attorney General (hereinafter ‘investigators’) are authorized to enter without delay and at reasonable times (as defined in subsection (c)(1)) any establishment of a producer where records under § 75.2 are maintained to inspect, within reasonable limits and in a reasonable manner, for the purpose of determining compliance with the record-keeping requirements of 18 U.S.C. 2257.”

However, the underlying statute requires only that the records be made “available to the Attorney General at all reasonable times [emphasis added].” 18 U.S.C. § 2257(c). The Department obviously takes the position here that Congress could not have intended

to limit the inspection privileges exclusively to the Attorney General – the member of the President’s Cabinet – personally. What Congress clearly did not do, however, is allow the Attorney General to deputize any private citizen to conduct inspections under this Act. And there are good reasons Congress did not write such expansive language as is found in the regulations.

28 U.S.C. § 515 defines persons who can act for the Attorney General: “Authority for legal proceedings; commission, oath,

and salary for special attorneys

“(a) The Attorney General or any other officer of the Department of Justice, or any attorney specially appointed by the Attorney General under law, may, when specifically directed by the Attorney General, conduct any kind of legal proceeding, civil or criminal, including grand jury proceedings and proceedings before committing magistrate judges, which United States attorneys are authorized by law to conduct, whether or not he is a resident of the district in which the proceeding is brought.

“(b) Each attorney specially retained under authority of the Department of Justice shall be commissioned as special assistant to the Attorney General or special attorney, and shall take the oath required by law. Foreign counsel employed in special cases are not required to take the oath. The Attorney General shall fix the annual salary of a special assistant or special attorney.”

The proposed regulations are not authorized by Congress to the extent that they allow inspections by other than those persons identified in § 515, above. Worse, the regulations do not identify any class of persons or qualifications required for those designated as inspectors. There is a good reason why Congress enacted § 515 and why the Department of Justice has rigorous standards for employing attorneys. This regulation empowers a low-ranking attorney in the Department to deputize virtually anyone as an investigator. And, although it can be presumed that those appointed as investigators would not be convicted felons or minors, certainly zealots who oppose any form of erotic expression will be knocking on the Department’s door to volunteer.

While it is doubtful that anyone other than those identified in § 515 could legally be appointed as inspectors, at the very least the class and qualifications for inspectors must be included in the proposed regulations and subjected to public scrutiny and comment. Indeed, the list of each individual proposed as an investigator should be subject to such scrutiny.

Most important is that individuals who fall under § 515 are issued identification badges by the Department of Justice. A producer subject to an inspection can become acquainted with the character of those identification badges, as is done with drivers’ licenses to identify the age of a performer, so as to be able to verify the credentials of a purported inspector.

The records required by § 2257 maintained contain very sensitive information, most significantly the residence address of a performer. Under the proposed regulations, that places a producer confronted with someone claiming to be an inspector in an untenable position. The producer could be guilty of a felony by refusing to allow the inspection, or could subject performers to harassment by allowing an imposter to inspect and copy the identification documents.⁹

If inspections are to be allowed by other than Department of Justice Attorneys – the legality of which is doubtful – the Department must, by regulation, create a special identification document (such as a card), affirming the inspector’s appointment by the Attorney General. By so doing, producers can learn to recognize such documents, thereby knowing whether the inspector is bona fide or an imposter. By the creation of such an identification document, anyone forging one would be subject to punishment under 18 U.S.C. § 1028, and other anti-forgery statutes.

Suggested Remedy

Modify the proposed § 75.5(a) to replace “Investigators designated by the Attorney General” with “The Attorney general and anyone designated by 28 U.S.C. § 515”. In any event, the investigators must be specifically defined, and an identification document establishing authority to conduct inspections must be created.

XX.

THE EXCLUSIONS FOR WEB HOSTING SERVICES

The exclusion from the definition of “producer” of certain Web hosting services exceeds the Department’s regulatory authority, and is vague and inadequate, ignoring the realities of the Internet.

Background

Section 75.1(c)(4)(iv) excludes from the definition of a producer “a provider of web hosting service who does not manage the content of the computer site or service.” This exclusion is vague, and does not clearly exempt all hosts and other service providers

⁹ This is for exactly that reason that California has excluded drivers’ license records from the public. CAL. VEHICLE CODE § 1808.21(a).

who merely allow for access to some form of online content without exercising editorial decisions over the content. For example, some hosts or service providers may exercise editorial or managerial control over some forms of content online, such as free hosts who include banner advertisements on the display of various websites, as their means of revenue generation. Other hosts may, to a certain extent, control the way in which content is displayed, thus, potentially removing those hosts from the scope of the exemption. To include them would apparently contradict the presumed intent of the exemption.

More fundamentally, however, the exclusion must be broadened to embrace the decision in Sundance Associates, Inc. v. Reno, 139 F.3d 804 (10th Cir. 1998) which, as explained earlier, prohibits the regulations from requiring record keeping by anyone involved only in an activity “which does not involve hiring, contracting for[,] managing, or otherwise arranging for the participation of the performers depicted.”

Suggested Remedy

Combine 75.1(c)(4)(iv) and 75.1(c)(4)(v), to state, “A provider of Web-hosting services, of an electronic communication service or of a remote computing service engaged only in activity that does not involve hiring, contracting for, managing, or otherwise arranging for the participation of the performers depicted.” At least, the word “content” should be modified with the words “sexually explicit,” thereby changing the definition to “a provider of web hosting services who does not manage the sexually explicit content of the computer site or service.”

XXI.

THE LOCATION OF THE DISCLOSURE ON A WEB SITE

The required location of the disclosure on a Web page is unreasonable and vague.

Background

As proposed, § 75.8(d) requires:

“A computer site or service or Web address containing a computer-generated image, digital image, or picture, shall contain the required statement on its homepage or principal URL.”

This creates several problems. First, many websites operate under a “sub- domain” business model, wherein a particular domain can have hundreds or thousands of sub-domains, making the “principal URL” or “homepage” difficult to identify with certainty. Moreover, requiring the entire text of the disclosure, which may involve

records custodian names and addresses for many content producers, which in some cases may consume pages and pages, will substantially interfere with the content and message sought to be conveyed on websites complying with the disclosure. The homepage of a Web site is often designed to be quickly loaded by a user’s computer because studies have established that Web surfers will not wait very long for a page to load; but will instead stop the loading process and go to another website if any substantial delay is generated by the loading of too much information on a homepage. Requiring the disclosure statement to be contained on the “homepage” or “principal URL” may cause significant downloading delays, resulting in lost user traffic and reduced revenue.

Moreover, an alternative that would be perfectly acceptable and consistent with the purpose of the statute would be to establish a link on the home page, directing the viewer to a page where the required information is displayed. Many Web site operators have adopted that approach, and in no case is there any difficulty locating the statement. Further, that approach allows the webmaster to place the link on a number of different pages where there might be some doubt as to which is the homepage or principal URL.

Suggested Remedy

Rewrite § 75.8(d) to state, “An interactive computer service shall contain the required statement either on a document that can be viewed by utilizing a conspicuous link from the first page accessed, or on that page.”

Respectfully submitted, WESTON, GARROU & DEWITT

12121 Wilshire Boulevard, Suite 900 Los Angeles, CA90025

(310) 442-0072

Fax (310) 442-0899

Dated: August 24, 2004

781 Douglas Avenue Altamonte Springs, FL 32714 (407) 389-4529

Fax (407) 774-6151

 

S. 877

One Hundred Eighth Congress of the

United States of America

AT THE FIRST SESSION

Begun and held at the City of Washington on Tuesday, the seventh day of January, two thousand and three

An Act

To regulate interstate commerce by imposing limitations and penalties on the trans- mission of unsolicited commercial electronic mail via the Internet.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Controlling the Assault of Non- Solicited Pornography and Marketing Act of 2003’’, or the ‘‘CAN- SPAM Act of 2003’’.

SEC. 2. CONGRESSIONAL FINDINGS AND POLICY.

1. FINDINGS.—The Congress finds the following:

   1. Electronic mail has become an extremely important and popular means of communication, relied on by millions of Americans on a daily basis for personal and commercial purposes. Its low cost and global reach make it extremely convenient and efficient, and offer unique opportunities for the development and growth of frictionless commerce.

   2. The convenience and efficiency of electronic mail are threatened by the extremely rapid growth in the volume of unsolicited commercial electronic mail. Unsolicited commercial electronic mail is currently estimated to account for over half of all electronic mail traffic, up from an estimated 7 percent in 2001, and the volume continues to rise. Most of these mes- sages are fraudulent or deceptive in one or more respects.

   3. The receipt of unsolicited commercial electronic mail may result in costs to recipients who cannot refuse to accept such mail and who incur costs for the storage of such mail, or for the time spent accessing, reviewing, and discarding such mail, or for both.

   4. The receipt of a large number of unwanted messages also decreases the convenience of electronic mail and creates a risk that wanted electronic mail messages, both commercial and noncommercial, will be lost, overlooked, or discarded amidst the larger volume of unwanted messages, thus reducing the reliability and usefulness of electronic mail to the recipient.

   5. Some commercial electronic mail contains material that many recipients may consider vulgar or pornographic in nature.

   6. The growth in unsolicited commercial electronic mail imposes significant monetary costs on providers of Internet access services, businesses, and educational and nonprofit institutions that carry and receive such mail, as there is a finite volume of mail that such providers, businesses, and

S. 877—2

institutions can handle without further investment in infra- structure.

1. Many senders of unsolicited commercial electronic mail purposefully disguise the source of such mail.

2. Many senders of unsolicited commercial electronic mail purposefully include misleading information in the messages’ subject lines in order to induce the recipients to view the messages.

3. While some senders of commercial electronic mail mes- sages provide simple and reliable ways for recipients to reject (or ‘‘opt-out’’ of) receipt of commercial electronic mail from such senders in the future, other senders provide no such ‘‘opt-out’’ mechanism, or refuse to honor the requests of recipi- ents not to receive electronic mail from such senders in the future, or both.

4. Many senders of bulk unsolicited commercial electronic mail use computer programs to gather large numbers of elec- tronic mail addresses on an automated basis from Internet websites or online services where users must post their addresses in order to make full use of the website or service.

5. Many States have enacted legislation intended to regu- late or reduce unsolicited commercial electronic mail, but these statutes impose different standards and requirements. As a result, they do not appear to have been successful in addressing the problems associated with unsolicited commercial electronic mail, in part because, since an electronic mail address does not specify a geographic location, it can be extremely difficult for law-abiding businesses to know with which of these dis- parate statutes they are required to comply.

6. The problems associated with the rapid growth and abuse of unsolicited commercial electronic mail cannot be solved by Federal legislation alone. The development and adoption of technological approaches and the pursuit of cooperative efforts with other countries will be necessary as well.

1. CONGRESSIONAL DETERMINATION OF PUBLIC POLICY.—On the basis of the findings in subsection (a), the Congress determines that—

   1. there is a substantial government interest in regulation of commercial electronic mail on a nationwide basis;

   2. senders of commercial electronic mail should not mis- lead recipients as to the source or content of such mail; and

   3. recipients of commercial electronic mail have a right to decline to receive additional commercial electronic mail from the same source.

SEC. 3. DEFINITIONS.

In this Act:

1. AFFIRMATIVE CONSENT.—The term ‘‘affirmative con- sent’’, when used with respect to a commercial electronic mail message, means that—

   1. the recipient expressly consented to receive the message, either in response to a clear and conspicuous request for such consent or at the recipient’s own initiative; and

   2. if the message is from a party other than the party to which the recipient communicated such consent, the recipient was given clear and conspicuous notice at

S. 877—3

the time the consent was communicated that the recipient’s electronic mail address could be transferred to such other party for the purpose of initiating commercial electronic mail messages.

2. COMMERCIAL ELECTRONIC MAIL MESSAGE.—

   1. IN GENERAL.—The term ‘‘commercial electronic mail message’’ means any electronic mail message the primary purpose of which is the commercial advertisement or pro- motion of a commercial product or service (including con- tent on an Internet website operated for a commercial purpose).

   2. TRANSACTIONAL OR RELATIONSHIP MESSAGES.—The term ‘‘commercial electronic mail message’’ does not include a transactional or relationship message.

   3. REGULATIONS REGARDING PRIMARY PURPOSE.—Not later than 12 months after the date of the enactment of this Act, the Commission shall issue regulations pursu- ant to section 13 defining the relevant criteria to facilitate the determination of the primary purpose of an electronic mail message.

   4. REFERENCE TO COMPANY OR WEBSITE.—The inclu- sion of a reference to a commercial entity or a link to the website of a commercial entity in an electronic mail message does not, by itself, cause such message to be treated as a commercial electronic mail message for pur- poses of this Act if the contents or circumstances of the message indicate a primary purpose other than commercial advertisement or promotion of a commercial product or service.

3. COMMISSION.—The term ‘‘Commission’’ means the Fed- eral Trade Commission.

4. DOMAIN NAME.—The term ‘‘domain name’’ means any alphanumeric designation which is registered with or assigned by any domain name registrar, domain name registry, or other domain name registration authority as part of an electronic address on the Internet.

5. ELECTRONIC MAIL ADDRESS.—The term ‘‘electronic mail address’’ means a destination, commonly expressed as a string of characters, consisting of a unique user name or mailbox (commonly referred to as the ‘‘local part’’) and a reference to an Internet domain (commonly referred to as the ‘‘domain part’’), whether or not displayed, to which an electronic mail message can be sent or delivered.

6. ELECTRONIC MAIL MESSAGE.—The term ‘‘electronic mail message’’ means a message sent to a unique electronic mail address.

7. FTC ACT.—The term ‘‘FTC Act’’ means the Federal Trade Commission Act (15 U.S.C. 41 et seq.).

8. HEADER INFORMATION.—The term ‘‘header information’’ means the source, destination, and routing information attached to an electronic mail message, including the origi- nating domain name and originating electronic mail address, and any other information that appears in the line identifying, or purporting to identify, a person initiating the message.

9. INITIATE.—The term ‘‘initiate’’, when used with respect to a commercial electronic mail message, means to originate or transmit such message or to procure the origination or

S. 877—4

transmission of such message, but shall not include actions that constitute routine conveyance of such message. For pur- poses of this paragraph, more than one person may be consid- ered to have initiated a message.

10. INTERNET.—The term ‘‘Internet’’ has the meaning given that term in the Internet Tax Freedom Act (47 U.S.C. 151 nt).

11. INTERNET ACCESS SERVICE.—The term ‘‘Internet access service’’ has the meaning given that term in section 231(e)(4) of the Communications Act of 1934 (47 U.S.C. 231(e)(4)).

12. PROCURE.—The term ‘‘procure’’, when used with respect to the initiation of a commercial electronic mail mes- sage, means intentionally to pay or provide other consideration to, or induce, another person to initiate such a message on one’s behalf.

13. PROTECTED COMPUTER.—The term ‘‘protected com- puter’’ has the meaning given that term in section 1030(e)(2)(B) of title 18, United States Code.

14. RECIPIENT.—The term ‘‘recipient’’, when used with respect to a commercial electronic mail message, means an authorized user of the electronic mail address to which the message was sent or delivered. If a recipient of a commercial electronic mail message has one or more electronic mail addresses in addition to the address to which the message was sent or delivered, the recipient shall be treated as a sepa- rate recipient with respect to each such address. If an electronic mail address is reassigned to a new user, the new user shall not be treated as a recipient of any commercial electronic mail message sent or delivered to that address before it was reassigned.

15. ROUTINE CONVEYANCE.—The term ‘‘routine convey- ance’’ means the transmission, routing, relaying, handling, or storing, through an automatic technical process, of an electronic mail message for which another person has identified the recipi- ents or provided the recipient addresses.

16. SENDER.—

    1. IN GENERAL.—Except as provided in subparagraph (B), the term ‘‘sender’’, when used with respect to a commercial electronic mail message, means a person who initiates such a message and whose product, service, or Internet web site is advertised or promoted by the message.

    2. SEPARATE LINES OF BUSINESS OR DIVISIONS.—If an entity operates through separate lines of business or divi- sions and holds itself out to the recipient throughout the message as that particular line of business or division rather than as the entity of which such line of business or division is a part, then the line of business or the division shall be treated as the sender of such message for purposes of this Act.

17. TRANSACTIONAL OR RELATIONSHIP MESSAGE.—

    1. IN GENERAL.—The term ‘‘transactional or relation- ship message’’ means an electronic mail message the pri- mary purpose of which is—

       1. to facilitate, complete, or confirm a commercial transaction that the recipient has previously agreed to enter into with the sender;

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2. to provide warranty information, product recall information, or safety or security information with respect to a commercial product or service used or purchased by the recipient;

3. to provide—

   1. notification concerning a change in the terms or features of;

   2. notification of a change in the recipient’s standing or status with respect to; or

   3. at regular periodic intervals, account bal- ance information or other type of account state- ment with respect to,

a subscription, membership, account, loan, or com- parable ongoing commercial relationship involving the ongoing purchase or use by the recipient of products or services offered by the sender;

1. to provide information directly related to an employment relationship or related benefit plan in which the recipient is currently involved, participating, or enrolled; or

2. to deliver goods or services, including product updates or upgrades, that the recipient is entitled to receive under the terms of a transaction that the recipient has previously agreed to enter into with the sender.

1. MODIFICATION OF DEFINITION.—The Commission by regulation pursuant to section 13 may modify the definition in subparagraph (A) to expand or contract the categories of messages that are treated as transactional or relation- ship messages for purposes of this Act to the extent that such modification is necessary to accommodate changes in electronic mail technology or practices and accomplish the purposes of this Act.

SEC. 4. PROHIBITION AGAINST PREDATORY AND ABUSIVE COMMER- CIAL E-MAIL.

1. OFFENSE.—

   1. IN GENERAL.—Chapter 47 of title 18, United States Code, is amended by adding at the end the following new section:

‘‘§ 1037. Fraud and related activity in connection with elec- tronic mail

‘‘(a) IN GENERAL.—Whoever, in or affecting interstate or foreign commerce, knowingly—

‘‘(1) accesses a protected computer without authorization, and intentionally initiates the transmission of multiple commer- cial electronic mail messages from or through such computer, ‘‘(2) uses a protected computer to relay or retransmit mul- tiple commercial electronic mail messages, with the intent to deceive or mislead recipients, or any Internet access service,

as to the origin of such messages,

‘‘(3) materially falsifies header information in multiple commercial electronic mail messages and intentionally initiates the transmission of such messages,

‘‘(4) registers, using information that materially falsifies the identity of the actual registrant, for five or more electronic

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mail accounts or online user accounts or two or more domain names, and intentionally initiates the transmission of multiple commercial electronic mail messages from any combination of such accounts or domain names, or

‘‘(5) falsely represents oneself to be the registrant or the legitimate successor in interest to the registrant of 5 or more Internet Protocol addresses, and intentionally initiates the transmission of multiple commercial electronic mail messages from such addresses,

or conspires to do so, shall be punished as provided in subsection (b).

‘‘(b) PENALTIES.—The punishment for an offense under sub- section (a) is—

‘‘(1) a fine under this title, imprisonment for not more than 5 years, or both, if—

‘‘(A) the offense is committed in furtherance of any felony under the laws of the United States or of any State; or

‘‘(B) the defendant has previously been convicted under this section or section 1030, or under the law of any State for conduct involving the transmission of multiple commer- cial electronic mail messages or unauthorized access to a computer system;

‘‘(2) a fine under this title, imprisonment for not more than 3 years, or both, if—

‘‘(A) the offense is an offense under subsection (a)(1); ‘‘(B) the offense is an offense under subsection (a)(4) and involved 20 or more falsified electronic mail or online user account registrations, or 10 or more falsified domain

name registrations;

‘‘(C) the volume of electronic mail messages trans- mitted in furtherance of the offense exceeded 2,500 during any 24-hour period, 25,000 during any 30-day period, or 250,000 during any 1-year period;

‘‘(D) the offense caused loss to one or more persons aggregating $5,000 or more in value during any 1-year period;

‘‘(E) as a result of the offense any individual commit- ting the offense obtained anything of value aggregating

$5,000 or more during any 1-year period; or

‘‘(F) the offense was undertaken by the defendant in concert with three or more other persons with respect to whom the defendant occupied a position of organizer or leader; and

‘‘(3) a fine under this title or imprisonment for not more than 1 year, or both, in any other case.

‘‘(c) FORFEITURE.—

‘‘(1) IN GENERAL.—The court, in imposing sentence on a person who is convicted of an offense under this section, shall order that the defendant forfeit to the United States—

‘‘(A) any property, real or personal, constituting or traceable to gross proceeds obtained from such offense; and

‘‘(B) any equipment, software, or other technology used or intended to be used to commit or to facilitate the commis- sion of such offense.

‘‘Sec.

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‘‘(2) PROCEDURES.—The procedures set forth in section 413 of the Controlled Substances Act (21 U.S.C. 853), other than subsection (d) of that section, and in Rule 32.2 of the Federal Rules of Criminal Procedure, shall apply to all stages of a criminal forfeiture proceeding under this section.

‘‘(d) DEFINITIONS.—In this section:

‘‘(1) LOSS.—The term ‘loss’ has the meaning given that term in section 1030(e) of this title.

‘‘(2) MATERIALLY.—For purposes of paragraphs (3) and (4) of subsection (a), header information or registration information is materially falsified if it is altered or concealed in a manner that would impair the ability of a recipient of the message, an Internet access service processing the message on behalf of a recipient, a person alleging a violation of this section, or a law enforcement agency to identify, locate, or respond to a person who initiated the electronic mail message or to investigate the alleged violation.

‘‘(3) MULTIPLE.—The term ‘multiple’ means more than 100 electronic mail messages during a 24-hour period, more than 1,000 electronic mail messages during a 30-day period, or more than 10,000 electronic mail messages during a 1-year period. ‘‘(4) OTHER TERMS.—Any other term has the meaning given

that term by section 3 of the CAN-SPAM Act of 2003.’’.

2. CONFORMING AMENDMENT.—The chapter analysis for chapter 47 of title 18, United States Code, is amended by adding at the end the following:

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1. those convicted of other offenses, including offenses involving fraud, identity theft, obscenity, child pornog- raphy, and the sexual exploitation of children, if such offenses involved the sending of large quantities of elec- tronic mail.

1. SENSE OF CONGRESS.—It is the sense of Congress that—

   1. Spam has become the method of choice for those who distribute pornography, perpetrate fraudulent schemes, and introduce viruses, worms, and Trojan horses into personal and business computer systems; and

   2. the Department of Justice should use all existing law enforcement tools to investigate and prosecute those who send bulk commercial e-mail to facilitate the commission of Federal crimes, including the tools contained in chapters 47 and 63 of title 18, United States Code (relating to fraud and false statements); chapter 71 of title 18, United States Code (relating to obscenity); chapter 110 of title 18, United States Code (relating to the sexual exploitation of children); and chapter

95 of title 18, United States Code (relating to racketeering), as appropriate.

SEC. 5. OTHER PROTECTIONS FOR USERS OF COMMERCIAL ELEC- TRONIC MAIL.

1. REQUIREMENTS FOR TRANSMISSION OF MESSAGES.—

   1. PROHIBITION OF FALSE OR MISLEADING TRANSMISSION INFORMATION.—It is unlawful for any person to initiate the transmission, to a protected computer, of a commercial elec- tronic mail message, or a transactional or relationship message, that contains, or is accompanied by, header information that is materially false or materially misleading. For purposes of this paragraph—

      1. header information that is technically accurate but includes an originating electronic mail address, domain name, or Internet Protocol address the access to which for purposes of initiating the message was obtained by means of false or fraudulent pretenses or representations shall be considered materially misleading;

      2. a ‘‘from’’ line (the line identifying or purporting to identify a person initiating the message) that accurately identifies any person who initiated the message shall not be considered materially false or materially misleading; and

      3. header information shall be considered materially misleading if it fails to identify accurately a protected computer used to initiate the message because the person initiating the message knowingly uses another protected computer to relay or retransmit the message for purposes of disguising its origin.

   2. PROHIBITION OF DECEPTIVE SUBJECT HEADINGS.—It is unlawful for any person to initiate the transmission to a pro- tected computer of a commercial electronic mail message if such person has actual knowledge, or knowledge fairly implied on the basis of objective circumstances, that a subject heading of the message would be likely to mislead a recipient, acting reasonably under the circumstances, about a material fact

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regarding the contents or subject matter of the message (con- sistent with the criteria used in enforcement of section 5 of the Federal Trade Commission Act (15 U.S.C. 45)).

3. INCLUSION OF RETURN ADDRESS OR COMPARABLE MECHA– NISM IN COMMERCIAL ELECTRONIC MAIL.—

   1. IN GENERAL.—It is unlawful for any person to ini- tiate the transmission to a protected computer of a com- mercial electronic mail message that does not contain a functioning return electronic mail address or other Inter- net-based mechanism, clearly and conspicuously displayed, that—

      1. a recipient may use to submit, in a manner specified in the message, a reply electronic mail mes- sage or other form of Internet-based communication requesting not to receive future commercial electronic mail messages from that sender at the electronic mail address where the message was received; and

      2. remains capable of receiving such messages or communications for no less than 30 days after the transmission of the original message.

   2. MORE DETAILED OPTIONS POSSIBLE.—The person initiating a commercial electronic mail message may comply with subparagraph (A)(i) by providing the recipient a list or menu from which the recipient may choose the specific types of commercial electronic mail messages the recipient wants to receive or does not want to receive from the sender, if the list or menu includes an option under which the recipient may choose not to receive any commercial electronic mail messages from the sender.

   3. TEMPORARY INABILITY TO RECEIVE MESSAGES OR PROCESS REQUESTS.—A return electronic mail address or other mechanism does not fail to satisfy the requirements of subparagraph (A) if it is unexpectedly and temporarily unable to receive messages or process requests due to a technical problem beyond the control of the sender if the problem is corrected within a reasonable time period.

4. PROHIBITION OF TRANSMISSION OF COMMERCIAL ELEC– TRONIC MAIL AFTER OBJECTION.—

   1. IN GENERAL.—If a recipient makes a request using a mechanism provided pursuant to paragraph (3) not to receive some or any commercial electronic mail messages from such sender, then it is unlawful—

      1. for the sender to initiate the transmission to the recipient, more than 10 business days after the receipt of such request, of a commercial electronic mail message that falls within the scope of the request;

      2. for any person acting on behalf of the sender to initiate the transmission to the recipient, more than

10 business days after the receipt of such request, of a commercial electronic mail message with actual knowledge, or knowledge fairly implied on the basis of objective circumstances, that such message falls within the scope of the request;

3. for any person acting on behalf of the sender to assist in initiating the transmission to the recipient, through the provision or selection of addresses to which the message will be sent, of a commercial electronic

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mail message with actual knowledge, or knowledge fairly implied on the basis of objective circumstances, that such message would violate clause (i) or (ii); or

1. for the sender, or any other person who knows that the recipient has made such a request, to sell, lease, exchange, or otherwise transfer or release the electronic mail address of the recipient (including through any transaction or other transfer involving mailing lists bearing the electronic mail address of the recipient) for any purpose other than compliance with this Act or other provision of law.

1. SUBSEQUENT AFFIRMATIVE CONSENT.—A prohibition in subparagraph (A) does not apply if there is affirmative consent by the recipient subsequent to the request under subparagraph (A).

1. INCLUSION OF IDENTIFIER, OPT–OUT, AND PHYSICAL ADDRESS IN COMMERCIAL ELECTRONIC MAIL.—(A) It is unlawful for any person to initiate the transmission of any commercial electronic mail message to a protected computer unless the message provides—

1. clear and conspicuous identification that the mes- sage is an advertisement or solicitation;

2. clear and conspicuous notice of the opportunity under paragraph (3) to decline to receive further commer- cial electronic mail messages from the sender; and

3. a valid physical postal address of the sender.

(B) Subparagraph (A)(i) does not apply to the transmission of a commercial electronic mail message if the recipient has given prior affirmative consent to receipt of the message.

1. MATERIALLY.—For purposes of paragraph (1), the term ‘‘materially’’, when used with respect to false or misleading header information, includes the alteration or concealment of header information in a manner that would impair the ability of an Internet access service processing the message on behalf of a recipient, a person alleging a violation of this section, or a law enforcement agency to identify, locate, or respond to a person who initiated the electronic mail message or to investigate the alleged violation, or the ability of a recipient of the message to respond to a person who initiated the elec- tronic message.

1. AGGRAVATED VIOLATIONS RELATING TO COMMERCIAL ELEC–

TRONIC MAIL.—

1. ADDRESS HARVESTING AND DICTIONARY ATTACKS.—

   1. IN GENERAL.—It is unlawful for any person to ini- tiate the transmission, to a protected computer, of a commercial electronic mail message that is unlawful under subsection (a), or to assist in the origination of such mes- sage through the provision or selection of addresses to which the message will be transmitted, if such person had actual knowledge, or knowledge fairly implied on the basis of objective circumstances, that—

      1. the electronic mail address of the recipient was obtained using an automated means from an Internet website or proprietary online service operated by another person, and such website or online service included, at the time the address was obtained, a notice stating that the operator of such website or online

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service will not give, sell, or otherwise transfer addresses maintained by such website or online service to any other party for the purposes of initiating, or enabling others to initiate, electronic mail messages; or

1. the electronic mail address of the recipient was obtained using an automated means that gen- erates possible electronic mail addresses by combining names, letters, or numbers into numerous permuta- tions.

1. DISCLAIMER.—Nothing in this paragraph creates an ownership or proprietary interest in such electronic mail addresses.

1. AUTOMATED CREATION OF MULTIPLE ELECTRONIC MAIL ACCOUNTS.—It is unlawful for any person to use scripts or other automated means to register for multiple electronic mail accounts or online user accounts from which to transmit to a protected computer, or enable another person to transmit to a protected computer, a commercial electronic mail message that is unlawful under subsection (a).

2. RELAY OR RETRANSMISSION THROUGH UNAUTHORIZED ACCESS.—It is unlawful for any person knowingly to relay or retransmit a commercial electronic mail message that is unlaw- ful under subsection (a) from a protected computer or computer network that such person has accessed without authorization.

1. SUPPLEMENTARY RULEMAKING AUTHORITY.—The Commis- sion shall by regulation, pursuant to section 13—

   1. modify the 10-business-day period under subsection (a)(4)(A) or subsection (a)(4)(B), or both, if the Commission determines that a different period would be more reasonable after taking into account—

      1. the purposes of subsection (a);

      2. the interests of recipients of commercial electronic mail; and

      3. the burdens imposed on senders of lawful commer- cial electronic mail; and

   2. specify additional activities or practices to which sub- section (b) applies if the Commission determines that those activities or practices are contributing substantially to the pro- liferation of commercial electronic mail messages that are unlawful under subsection (a).

2. REQUIREMENT TO PLACE WARNING LABELS ON COMMERCIAL ELECTRONIC MAIL CONTAINING SEXUALLY ORIENTED MATERIAL.—

   1. IN GENERAL.—No person may initiate in or affecting interstate commerce the transmission, to a protected computer, of any commercial electronic mail message that includes sexu- ally oriented material and—

      1. fail to include in subject heading for the electronic mail message the marks or notices prescribed by the Commission under this subsection; or

      2. fail to provide that the matter in the message that is initially viewable to the recipient, when the message is opened by any recipient and absent any further actions by the recipient, includes only—

         1. to the extent required or authorized pursuant to paragraph (2), any such marks or notices;

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1. the information required to be included in the message pursuant to subsection (a)(5); and

2. instructions on how to access, or a mechanism to access, the sexually oriented material.

1. PRIOR AFFIRMATIVE CONSENT.—Paragraph (1) does not apply to the transmission of an electronic mail message if the recipient has given prior affirmative consent to receipt of the message.

2. PRESCRIPTION OF MARKS AND NOTICES.—Not later than

120 days after the date of the enactment of this Act, the Commission in consultation with the Attorney General shall prescribe clearly identifiable marks or notices to be included in or associated with commercial electronic mail that contains sexually oriented material, in order to inform the recipient of that fact and to facilitate filtering of such electronic mail. The Commission shall publish in the Federal Register and provide notice to the public of the marks or notices prescribed under this paragraph.

4. DEFINITION.—In this subsection, the term ‘‘sexually ori- ented material’’ means any material that depicts sexually explicit conduct (as that term is defined in section 2256 of title 18, United States Code), unless the depiction constitutes a small and insignificant part of the whole, the remainder of which is not primarily devoted to sexual matters.

5. PENALTY.—Whoever knowingly violates paragraph (1) shall be fined under title 18, United States Code, or imprisoned not more than 5 years, or both.

SEC. 6. BUSINESSES KNOWINGLY PROMOTED BY ELECTRONIC MAIL WITH FALSE OR MISLEADING TRANSMISSION INFORMATION.

1. IN GENERAL.—It is unlawful for a person to promote, or allow the promotion of, that person’s trade or business, or goods, products, property, or services sold, offered for sale, leased or offered for lease, or otherwise made available through that trade or busi- ness, in a commercial electronic mail message the transmission of which is in violation of section 5(a)(1) if that person—

   1. knows, or should have known in the ordinary course of that person’s trade or business, that the goods, products, property, or services sold, offered for sale, leased or offered for lease, or otherwise made available through that trade or business were being promoted in such a message;

   2. received or expected to receive an economic benefit from such promotion; and

   3. took no reasonable action—

      1. to prevent the transmission; or

      2. to detect the transmission and report it to the Commission.

2. LIMITED ENFORCEMENT AGAINST THIRD PARTIES.—

   1. IN GENERAL.—Except as provided in paragraph (2), a person (hereinafter referred to as the ‘‘third party’’) that pro- vides goods, products, property, or services to another person that violates subsection (a) shall not be held liable for such violation.

   2. EXCEPTION.—Liability for a violation of subsection (a) shall be imputed to a third party that provides goods, products, property, or services to another person that violates subsection

1. if that third party—

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1. owns, or has a greater than 50 percent ownership or economic interest in, the trade or business of the person that violated subsection (a); or

(B)(i) has actual knowledge that goods, products, prop- erty, or services are promoted in a commercial electronic mail message the transmission of which is in violation of section 5(a)(1); and

(ii) receives, or expects to receive, an economic benefit from such promotion.

3. EXCLUSIVE ENFORCEMENT BY FTC.—Subsections (f) and (g) of section 7 do not apply to violations of this section.

4. SAVINGS PROVISION.—Except as provided in section 7(f)(8), nothing in this section may be construed to limit or prevent any action that may be taken under this Act with respect to any viola- tion of any other section of this Act.

SEC. 7. ENFORCEMENT GENERALLY.

1. VIOLATION IS UNFAIR OR DECEPTIVE ACT OR PRACTICE.— Except as provided in subsection (b), this Act shall be enforced by the Commission as if the violation of this Act were an unfair or deceptive act or practice proscribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).

2. ENFORCEMENT BY CERTAIN OTHER AGENCIES.—Compliance with this Act shall be enforced—

   1. under section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818), in the case of—

      1. national banks, and Federal branches and Federal agencies of foreign banks, by the Office of the Comptroller of the Currency;

      2. member banks of the Federal Reserve System (other than national banks), branches and agencies of for- eign banks (other than Federal branches, Federal agencies, and insured State branches of foreign banks), commercial lending companies owned or controlled by foreign banks, organizations operating under section 25 or 25A of the Federal Reserve Act (12 U.S.C. 601 and 611), and bank holding companies, by the Board;

      3. banks insured by the Federal Deposit Insurance Corporation (other than members of the Federal Reserve System) and insured State branches of foreign banks, by the Board of Directors of the Federal Deposit Insurance Corporation; and

      4. savings associations the deposits of which are insured by the Federal Deposit Insurance Corporation, by the Director of the Office of Thrift Supervision;

   2. under the Federal Credit Union Act (12 U.S.C. 1751 et seq.) by the Board of the National Credit Union Administra- tion with respect to any Federally insured credit union;

   3. under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) by the Securities and Exchange Commission with respect to any broker or dealer;

   4. under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.) by the Securities and Exchange Commission with respect to investment companies;

   5. under the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) by the Securities and Exchange Commission with respect to investment advisers registered under that Act;

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6. under State insurance law in the case of any person engaged in providing insurance, by the applicable State insur- ance authority of the State in which the person is domiciled, subject to section 104 of the Gramm-Bliley-Leach Act (15 U.S.C. 6701), except that in any State in which the State insurance authority elects not to exercise this power, the enforcement authority pursuant to this Act shall be exercised by the Commission in accordance with subsection (a);

7. under part A of subtitle VII of title 49, United States Code, by the Secretary of Transportation with respect to any air carrier or foreign air carrier subject to that part;

8. under the Packers and Stockyards Act, 1921 (7 U.S.C.

181 et seq.) (except as provided in section 406 of that Act (7 U.S.C. 226, 227)), by the Secretary of Agriculture with respect to any activities subject to that Act;

1. under the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.) by the Farm Credit Administration with respect to any Federal land bank, Federal land bank association, Federal intermediate credit bank, or production credit association; and

2. under the Communications Act of 1934 (47 U.S.C. 151 et seq.) by the Federal Communications Commission with respect to any person subject to the provisions of that Act.

1. EXERCISE OF CERTAIN POWERS.—For the purpose of the exercise by any agency referred to in subsection (b) of its powers under any Act referred to in that subsection, a violation of this Act is deemed to be a violation of a Federal Trade Commission trade regulation rule. In addition to its powers under any provision of law specifically referred to in subsection (b), each of the agencies referred to in that subsection may exercise, for the purpose of enforcing compliance with any requirement imposed under this Act, any other authority conferred on it by law.

2. ACTIONS BY THE COMMISSION.—The Commission shall pre- vent any person from violating this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms and provisions of the Federal Trade Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a part of this Act. Any entity that violates any provision of that subtitle is subject to the penalties and entitled to the privileges and immunities provided in the Federal Trade Commis- sion Act in the same manner, by the same means, and with the same jurisdiction, power, and duties as though all applicable terms and provisions of the Federal Trade Commission Act were incor- porated into and made a part of that subtitle.

3. AVAILABILITY OF CEASE–AND-DESIST ORDERS AND INJUNCTIVE RELIEF WITHOUT SHOWING OF KNOWLEDGE.—Notwithstanding any other provision of this Act, in any proceeding or action pursuant to subsection (a), (b), (c), or (d) of this section to enforce compliance, through an order to cease and desist or an injunction, with section 5(a)(1)(C), section 5(a)(2), clause (ii), (iii), or (iv) of section 5(a)(4)(A), section 5(b)(1)(A), or section 5(b)(3), neither the Commission nor the Federal Communications Commission shall be required to allege or prove the state of mind required by such section or subparagraph.

4. ENFORCEMENT BY STATES.—

   1. CIVIL ACTION.—In any case in which the attorney gen- eral of a State, or an official or agency of a State, has reason to believe that an interest of the residents of that State has been or is threatened or adversely affected by any person who

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violates paragraph (1) or (2) of section 5(a), who violates section 5(d), or who engages in a pattern or practice that violates paragraph (3), (4), or (5) of section 5(a), of this Act, the attorney general, official, or agency of the State, as parens patriae, may bring a civil action on behalf of the residents of the State in a district court of the United States of appropriate jurisdiction—

1. to enjoin further violation of section 5 of this Act by the defendant; or

2. to obtain damages on behalf of residents of the State, in an amount equal to the greater of—

   1. the actual monetary loss suffered by such resi- dents; or

   2. the amount determined under paragraph (3).

1. AVAILABILITY OF INJUNCTIVE RELIEF WITHOUT SHOWING OF KNOWLEDGE.—Notwithstanding any other provision of this Act, in a civil action under paragraph (1)(A) of this subsection, the attorney general, official, or agency of the State shall not be required to allege or prove the state of mind required by section 5(a)(1)(C), section 5(a)(2), clause (ii), (iii), or (iv) of section 5(a)(4)(A), section 5(b)(1)(A), or section 5(b)(3).

2. STATUTORY DAMAGES.—

   1. IN GENERAL.—For purposes of paragraph (1)(B)(ii), the amount determined under this paragraph is the amount calculated by multiplying the number of violations (with each separately addressed unlawful message received by or addressed to such residents treated as a separate viola- tion) by up to $250.

   2. LIMITATION.—For any violation of section 5 (other than section 5(a)(1)), the amount determined under subparagraph (A) may not exceed $2,000,000.

   3. AGGRAVATED DAMAGES.—The court may increase a damage award to an amount equal to not more than three times the amount otherwise available under this paragraph if—

      1. the court determines that the defendant com- mitted the violation willfully and knowingly; or

      2. the defendant’s unlawful activity included one or more of the aggravating violations set forth in sec- tion 5(b).

   4. REDUCTION OF DAMAGES.—In assessing damages under subparagraph (A), the court may consider whether—

      1. the defendant has established and implemented, with due care, commercially reasonable practices and procedures designed to effectively prevent such viola- tions; or

      2. the violation occurred despite commercially reasonable efforts to maintain compliance the practices and procedures to which reference is made in clause (i).

3. ATTORNEY FEES.—In the case of any successful action under paragraph (1), the court, in its discretion, may award the costs of the action and reasonable attorney fees to the State.

4. RIGHTS OF FEDERAL REGULATORS.—The State shall serve prior written notice of any action under paragraph (1) upon

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the Federal Trade Commission or the appropriate Federal regu- lator determined under subsection (b) and provide the Commis- sion or appropriate Federal regulator with a copy of its com- plaint, except in any case in which such prior notice is not feasible, in which case the State shall serve such notice imme- diately upon instituting such action. The Federal Trade Commission or appropriate Federal regulator shall have the right—

1. to intervene in the action;

2. upon so intervening, to be heard on all matters arising therein;

3. to remove the action to the appropriate United States district court; and

4. to file petitions for appeal.

1. CONSTRUCTION.—For purposes of bringing any civil action under paragraph (1), nothing in this Act shall be con- strued to prevent an attorney general of a State from exercising the powers conferred on the attorney general by the laws of that State to—

   1. conduct investigations;

   2. administer oaths or affirmations; or

   3. compel the attendance of witnesses or the produc- tion of documentary and other evidence.

2. VENUE; SERVICE OF PROCESS.—

   1. VENUE.—Any action brought under paragraph (1) may be brought in the district court of the United States that meets applicable requirements relating to venue under section 1391 of title 28, United States Code.

   2. SERVICE OF PROCESS.—In an action brought under paragraph (1), process may be served in any district in which the defendant—

      1. is an inhabitant; or

      2. maintains a physical place of business.

3. LIMITATION ON STATE ACTION WHILE FEDERAL ACTION IS PENDING.—If the Commission, or other appropriate Federal agency under subsection (b), has instituted a civil action or an administrative action for violation of this Act, no State attorney general, or official or agency of a State, may bring an action under this subsection during the pendency of that action against any defendant named in the complaint of the Commission or the other agency for any violation of this Act alleged in the complaint.

4. REQUISITE SCIENTER FOR CERTAIN CIVIL ACTIONS.— Except as provided in section 5(a)(1)(C), section 5(a)(2), clause (ii), (iii), or (iv) of section 5(a)(4)(A), section 5(b)(1)(A), or section 5(b)(3), in a civil action brought by a State attorney general, or an official or agency of a State, to recover monetary damages for a violation of this Act, the court shall not grant the relief sought unless the attorney general, official, or agency estab- lishes that the defendant acted with actual knowledge, or knowledge fairly implied on the basis of objective circumstances, of the act or omission that constitutes the violation.

1. ACTION BY PROVIDER OF INTERNET ACCESS SERVICE.—

   1. ACTION AUTHORIZED.—A provider of Internet access service adversely affected by a violation of section 5(a)(1), 5(b), or 5(d), or a pattern or practice that violates paragraph (2), (3), (4), or (5) of section 5(a), may bring a civil action in

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any district court of the United States with jurisdiction over the defendant—

1. to enjoin further violation by the defendant; or

2. to recover damages in an amount equal to the greater of—

   1. actual monetary loss incurred by the provider of Internet access service as a result of such violation; or

   2. the amount determined under paragraph (3).

1. SPECIAL DEFINITION OF ‘‘PROCURE’’.—In any action brought under paragraph (1), this Act shall be applied as if the definition of the term ‘‘procure’’ in section 3(12) contained, after ‘‘behalf’’ the words ‘‘with actual knowledge, or by con- sciously avoiding knowing, whether such person is engaging, or will engage, in a pattern or practice that violates this Act’’.

2. STATUTORY DAMAGES.—

   1. IN GENERAL.—For purposes of paragraph (1)(B)(ii), the amount determined under this paragraph is the amount calculated by multiplying the number of violations (with each separately addressed unlawful message that is trans- mitted or attempted to be transmitted over the facilities of the provider of Internet access service, or that is trans- mitted or attempted to be transmitted to an electronic mail address obtained from the provider of Internet access service in violation of section 5(b)(1)(A)(i), treated as a separate violation) by—

      1. up to $100, in the case of a violation of section 5(a)(1); or

      2. up to $25, in the case of any other violation of section 5.

   2. LIMITATION.—For any violation of section 5 (other than section 5(a)(1)), the amount determined under subparagraph (A) may not exceed $1,000,000.

   3. AGGRAVATED DAMAGES.—The court may increase a damage award to an amount equal to not more than three times the amount otherwise available under this paragraph if—

      1. the court determines that the defendant com- mitted the violation willfully and knowingly; or

      2. the defendant’s unlawful activity included one or more of the aggravated violations set forth in section 5(b).

   4. REDUCTION OF DAMAGES.—In assessing damages under subparagraph (A), the court may consider whether—

      1. the defendant has established and implemented, with due care, commercially reasonable practices and procedures designed to effectively prevent such viola- tions; or

      2. the violation occurred despite commercially reasonable efforts to maintain compliance with the practices and procedures to which reference is made in clause (i).

3. ATTORNEY FEES.—In any action brought pursuant to paragraph (1), the court may, in its discretion, require an undertaking for the payment of the costs of such action, and assess reasonable costs, including reasonable attorneys’ fees, against any party.

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SEC. 8. EFFECT ON OTHER LAWS.

1. FEDERAL LAW.—(1) Nothing in this Act shall be construed to impair the enforcement of section 223 or 231 of the Communica- tions Act of 1934 (47 U.S.C. 223 or 231, respectively), chapter

71 (relating to obscenity) or 110 (relating to sexual exploitation of children) of title 18, United States Code, or any other Federal criminal statute.

(2) Nothing in this Act shall be construed to affect in any way the Commission’s authority to bring enforcement actions under FTC Act for materially false or deceptive representations or unfair practices in commercial electronic mail messages.

2. STATE LAW.—

   1. IN GENERAL.—This Act supersedes any statute, regula- tion, or rule of a State or political subdivision of a State that expressly regulates the use of electronic mail to send commer- cial messages, except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto.

   2. STATE LAW NOT SPECIFIC TO ELECTRONIC MAIL.—This Act shall not be construed to preempt the applicability of—

      1. State laws that are not specific to electronic mail, including State trespass, contract, or tort law; or

      2. other State laws to the extent that those laws relate to acts of fraud or computer crime.

3. NO EFFECT ON POLICIES OF PROVIDERS OF INTERNET ACCESS SERVICE.—Nothing in this Act shall be construed to have any effect on the lawfulness or unlawfulness, under any other provision of law, of the adoption, implementation, or enforcement by a provider of Internet access service of a policy of declining to transmit, route, relay, handle, or store certain types of electronic mail messages.

SEC. 9. DO-NOT-E-MAIL REGISTRY.

1. IN GENERAL.—Not later than 6 months after the date of enactment of this Act, the Commission shall transmit to the Senate Committee on Commerce, Science, and Transportation and the House of Representatives Committee on Energy and Commerce a report that—

   1. sets forth a plan and timetable for establishing a nation- wide marketing Do-Not-E-Mail registry;

   2. includes an explanation of any practical, technical, secu- rity, privacy, enforceability, or other concerns that the Commis- sion has regarding such a registry; and

   3. includes an explanation of how the registry would be applied with respect to children with e-mail accounts.

2. AUTHORIZATION TO IMPLEMENT.—The Commission may establish and implement the plan, but not earlier than 9 months after the date of enactment of this Act.

SEC. 10. STUDY OF EFFECTS OF COMMERCIAL ELECTRONIC MAIL.

1. IN GENERAL.—Not later than 24 months after the date of the enactment of this Act, the Commission, in consultation with the Department of Justice and other appropriate agencies, shall submit a report to the Congress that provides a detailed analysis of the effectiveness and enforcement of the provisions of this Act and the need (if any) for the Congress to modify such provisions.

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2. REQUIRED ANALYSIS.—The Commission shall include in the report required by subsection (a)—

   1. an analysis of the extent to which technological and marketplace developments, including changes in the nature of the devices through which consumers access their electronic mail messages, may affect the practicality and effectiveness of the provisions of this Act;

   2. analysis and recommendations concerning how to address commercial electronic mail that originates in or is transmitted through or to facilities or computers in other nations, including initiatives or policy positions that the Federal Government could pursue through international negotiations, fora, organizations, or institutions; and

   3. analysis and recommendations concerning options for protecting consumers, including children, from the receipt and viewing of commercial electronic mail that is obscene or porno- graphic.

SEC. 11. IMPROVING ENFORCEMENT BY PROVIDING REWARDS FOR INFORMATION ABOUT VIOLATIONS; LABELING.

The Commission shall transmit to the Senate Committee on Commerce, Science, and Transportation and the House of Rep- resentatives Committee on Energy and Commerce—

1. a report, within 9 months after the date of enactment of this Act, that sets forth a system for rewarding those who supply information about violations of this Act, including—

   1. procedures for the Commission to grant a reward of not less than 20 percent of the total civil penalty collected for a violation of this Act to the first person that—

      1. identifies the person in violation of this Act;

and

2. supplies information that leads to the success-

ful collection of a civil penalty by the Commission; and

1. procedures to minimize the burden of submitting a complaint to the Commission concerning violations of this Act, including procedures to allow the electronic submission of complaints to the Commission; and

1. a report, within 18 months after the date of enactment of this Act, that sets forth a plan for requiring commercial electronic mail to be identifiable from its subject line, by means of compliance with Internet Engineering Task Force Standards, the use of the characters ‘‘ADV’’ in the subject line, or other comparable identifier, or an explanation of any concerns the Commission has that cause the Commission to recommend against the plan.

SEC. 12. RESTRICTIONS ON OTHER TRANSMISSIONS.

Section 227(b)(1) of the Communications Act of 1934 (47 U.S.C. 227(b)(1)) is amended, in the matter preceding subparagraph (A), by inserting ‘‘, or any person outside the United States if the recipient is within the United States’’ after ‘‘United States’’.

SEC. 13. REGULATIONS.

1. IN GENERAL.—The Commission may issue regulations to implement the provisions of this Act (not including the amendments made by sections 4 and 12). Any such regulations shall be issued in accordance with section 553 of title 5, United States Code.

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2. LIMITATION.—Subsection (a) may not be construed to authorize the Commission to establish a requirement pursuant to section 5(a)(5)(A) to include any specific words, characters, marks, or labels in a commercial electronic mail message, or to include the identification required by section 5(a)(5)(A) in any particular part of such a mail message (such as the subject line or body).

SEC. 14. APPLICATION TO WIRELESS.

1. EFFECT ON OTHER LAW.—Nothing in this Act shall be inter- preted to preclude or override the applicability of section 227 of the Communications Act of 1934 (47 U.S.C. 227) or the rules pre- scribed under section 3 of the Telemarketing and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6102).

2. FCC RULEMAKING.—The Federal Communications Commis- sion, in consultation with the Federal Trade Commission, shall promulgate rules within 270 days to protect consumers from unwanted mobile service commercial messages. The Federal Communications Commission, in promulgating the rules, shall, to the extent consistent with subsection (c)—

   1. provide subscribers to commercial mobile services the ability to avoid receiving mobile service commercial messages unless the subscriber has provided express prior authorization to the sender, except as provided in paragraph (3);

   2. allow recipients of mobile service commercial messages to indicate electronically a desire not to receive future mobile service commercial messages from the sender;

   3. take into consideration, in determining whether to sub- ject providers of commercial mobile services to paragraph (1), the relationship that exists between providers of such services and their subscribers, but if the Commission determines that such providers should not be subject to paragraph (1), the rules shall require such providers, in addition to complying with the other provisions of this Act, to allow subscribers to indicate a desire not to receive future mobile service commercial messages from the provider—

      1. at the time of subscribing to such service; and

      2. in any billing mechanism; and

   4. determine how a sender of mobile service commercial messages may comply with the provisions of this Act, consid- ering the unique technical aspects, including the functional and character limitations, of devices that receive such messages.

3. OTHER FACTORS CONSIDERED.—The Federal Communica- tions Commission shall consider the ability of a sender of a commer- cial electronic mail message to reasonably determine that the mes- sage is a mobile service commercial message.

4. MOBILE SERVICE COMMERCIAL MESSAGE DEFINED.—In this section, the term ‘‘mobile service commercial message’’ means a commercial electronic mail message that is transmitted directly to a wireless device that is utilized by a subscriber of commercial mobile service (as such term is defined in section 332(d) of the Communications Act of 1934 (47 U.S.C. 332(d))) in connection with such service.

SEC. 15. SEPARABILITY.

If any provision of this Act or the application thereof to any person or circumstance is held invalid, the remainder of this Act and the application of such provision to other persons or cir- cumstances shall not be affected.

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SEC. 16. EFFECTIVE DATE.

The provisions of this Act, other than section 9, shall take effect on January 1, 2004.

Speaker of the House of Representatives.

Vice President of the United States and

President of the Senate.

ADULT INDUSTRY UPDATE

By: Lawrence G. Walters

www.firstamendment.com

There’s no denying it; an undercurrent of fear has gripped the adult entertainment industry. The nomination of John Ashcroft for Attorney General is a good indicator of the type of law enforcement climate we are likely to see under the Bush administration. Conventional wisdom dictates that the Justice Department, with someone like Ashcroft at the helm, will dust off the antiquated obscenity laws and begin an attack on the adult industry, the likes of which have not been seen since the Regan years.

The good news is that the emergence of new media, such as the Internet, has created unique legal arguments that may potentially render these outdated laws unconstitutional.

According to AVN.com, a number of major production companies have been meeting to formulate strategies to counter a feared Bush administration crackdown on the industry. The Clinton administration has prosecuted few obscenity cases over the last eight years, choosing instead to concentrate its law enforcement resources on child pornography offenses. By all indications, that is about to change.

Putting aside the risk involved, the adult Internet industry has consistently been profitable. According to www.ihollywoodforum.com, “It’s the only segment of the entertainment industry that consistently makes money.”However, many of the owners of adult Internet companies are members of Generation X, and have not lived through the law enforcement crackdown during the Regan/Bush years. There also exists a pervasive attitude amongst Webmasters that virtually any sexually explicit content is legal so long as it does not involve children or animals. This is a dangerous conclusion, and one not well-supported by the history of obscenity prosecutions in this country. For instance, this writer has defended obscenity prosecutions brought against relatively tame works such as Deepthroat and Behind the Green Door. The bottom line is that obscenity can be anything that a jury believes it is, so long as the content is sexually explicit. Many of the larger companies are having their content reviewed by their attorneys in order to reduce the risk of obscenity prosecutions under the new administration. We have also suggested that our clients engage the services of psychologists and sex therapists to review all content before distribution. The next four years promise to be an interesting time for the adult industry, and a busy time for First Amendment lawyers.

The profits and success of the adult industry are, of course, driven by consumer desire. According to a new poll by Harlequin Enterprises, 75% of the population has erotic fantasies, although less than half act them out. Argentineans and Chileans are the most likely to have erotic fantasies, with 95% of the individuals polled admitting to having such fantasies. Japan was at the bottom of the list. Regardless of how the new administration approaches the issues of pornography and obscenity, it can’t outlaw the desire for intimate human contact.

Potential criminal prosecution is not the only problem facing the adult Internet industry. Recently, America Online (“AOL”) filed a lawsuit against Cyber Entertainment Network (“CEN”), a company that owns and operates adult Websites. The suit accuses CEN, and others, of sending junk email to AOL members, typically known as “Spam.” In addition to naming CEN, and its owners, the lawsuit names eight employees and twenty-five Webmasters under contract to promote the adult Websites. The Complaint seeks an injunction against further Spamming and damages, which could include ten ($10.00) dollars for each unsolicited email or $25,000.00 per day that each message was transmitted. The suit accuses CEN of violating its own “no Spam”policy by encouraging Webmasters to send unsolicited emails promoting its network of sites, according to Yahoo! News. This lawsuit is the latest attempt by AOL to deal with one of its biggest recurring problems: SPAM. On some days, customer complaints have reached 25,000, accordingtotheCompany. “Whatwe’reactingonisanobligationtoourmembersto hold spammers accountable,”said AOL’s Nicholas Graham. “we are pursuing the owners of a program who give out incentives for porn spamming-and those that then go out and harvest email addresses and screen names to expressly send Spam”he said. Ebay has announced a similar crackdown on members who send unsolicited email to other members, in response to mounting complaints.

By way of update from last month’s report on the City News & Novelties, Inc. v. City of Waukesha case pending in the U.S. Supreme Court; the Court recently decided to dismiss the case as moot. This decision appears to be a small victory for the adult industry since it was feared that the Court could use this case to take away significant First Amendment protections called procedural safeguards. Under the procedural safeguards doctrine, applicants for adult entertainment licenses are entitled to a decision on the application within a specified, brief time period, and a prompt judicial review of any licensing decision. For now, the law of procedural safeguards will remain the same. It could have been much worse.

The City News case was dismissed as moot after the adult business involved had closed its doors and indicated its intent to remain closed. Precisely the same scenario occurred in the Supreme Court case decided last year in the case of the City of Erie, Pennsylvania v Paps A.M.. According to the U.S. Supreme Court, the distinction was that the adult business had prevailed in the lower court in the Erie case, whereas the adult business had lost in the lower court in the City News case. Accordingly, if the Court had dismissed the Erie case as moot, the City would have been injured by the continuation of a decision in favor of the adult business. In contrast, the City of Waukesha would not be injured by dismissal of the City News case since the City had prevailed below. The lesson here is that the Court will do everything in its power to prevent a decision favorable to adult businesses.

In other news, the U.S. Supreme Court recently allowed an Appeals Court decision to stand which limited “sexually explicit communication”on the Internet. This decision was rendered from the Fourth Circuit Court of Appeals, which is seen as one of the most conservative courts in the country. The decision upheld a 1996 Virginia law that barred state employees from engaging in sexually explicit communication on the Internet.

The ACLU challenged the law on behalf of six University professors, claiming that it amounted to an attack on academic freedom. In a surprising holding, the Fourth Circuit Court of Appeals determined that job-related speech does not involve matters of public concern, and therefore is not protected by the First Amendment. The decision is seen as a serious threat to academic freedom in this country.

Webmasters who are seeking to avoid prosecution in the U.S. by moving overseas take heed: Singapore recently announced its intent to prosecute porn sites, no matter where they’re located. In a report from a Singapore-based online news service on January 05, 2001, the Singapore government announced its intention to prosecute its citizens who operate pornographic Websites, even if those sites are located on servers outside the country. The Computer Crimes Division of Singapore’s Criminal Investigation Department said: “The police will trace the location of the site and ask the overseas hosting company to help with investigations.” The CCD also confirmed that they were on the lookout for potential violators, according to the report. Under Singaporean law, operators of pornographic Websites can be prosecuted under the “Undesirable Publications Act”and face $10,000.00 in fines and up to three years in jail. The warnings appear to be working, since most Singaporean based adult Websites have shut down. We call that kind of self-censorship the “chilling effect.” Although… it seems like it’s getting pretty cold around these parts too.

Lawrence G. Walters, Esquire, is a partner in the law firm of Wasserman & Walters in Winter Park, Florida. His practice concentrates in First Amendment and Internet law. He represents clients involved in all aspects of adult media. All statements made in the above article are expressions of opinion only, and should not be considered specific legal advice. You should always consult your own lawyer regarding any legal issue. You can access the firm’s web site at: www.firstamendment.com