Database legislation.

Once again the U.S. Congress is considering database legislation to protect even uncopyrightable databases. For many years collections of facts such as print or electronic databases were protected by copyright under the sweat of the brow doctrine. The compiler of a factual database was rewarded for his or her hard work in gathering and compiling the facts. The U.S. Supreme Court altered the landscape considerably with the 1991 decision in Feist v. Rural Telephone Co., (1) which struck down the sweat of the brow doctrine and held that collections of facts had to satisfy the originality/creativity requirement. Hard work was no longer enough. While many such databases possess sufficient creativity, found in selection, arrangement, indexing, and value adding to the data, many others do not. Despite scant evidence that the database industry was suffering because of Feist, efforts were begun in the mid-1990s to convince Congress that a new form of legal protection was needed.

The European Union (EU) adopted a Database Directive (2) in 1996, which protects databases whether the compilation qualifies for copyright or not. The Directive made it possible to protect a collection of facts for even a minimal level of investment of money or resources. In exchange for this investment, the database owner gets a wide range of exclusive rights, including the right to extract or utilize all or a substantial part of the database for 15 years. The result is that the first comer obtains a powerful adaptation right similar to that which copyright provides. Member countries must adopt conforming database legislation. EU countries may exempt illustrations for teaching or scientific research and some countries have done so, but not all.

In the United States proponents of database legislation include most of the large commercial database publishers along with realtors, who are interested in protecting their "multiple listing" database, and the New York Stock Exchange. Opponents of database legislation include online service providers, online stockbrokers, major information technology companies, representatives of library associations, and higher education. Opponents also include groups that license large amounts of data from others. Editorials against overly strong database protection have run in the New York Times and the Washington Post.

Even among proponents, there are two different schools of thought about database legislation. One is relatively strong protection based on an exclusive property rights model, most recently embodied in H.R. 106-354. Others prefer a weaker form of protection based on a misappropriation model, reflected in H.R. 106-1858.

H.R. 354

The aim of the coverage in H.R. 354 is to achieve a similar level of protection as that provided by the EU Directive but to ensure that it complies with the legal traditions of the United States. It defines "collections of information" broadly as "information ... collected and ... organized for the purpose of bringing discrete items of information together in one place or through one source so that persons may access them." As with the EU Directive, eligibility is in terms of investment of substantial money or resources in gathering, organizing, or maintaining a collection of information. The owner then gets two exclusive rights: (1) a right to make all or a substantial part of a protected collection available to others and (2) a right to extract all or a substantial part of a database and to make it available to others. Data would be protected for 15 years, but any update to the database would make it eligible for another 15 years of protection. The bill has a reasonable use exception, but it is not at all similar to fair use. H.R. 354 was championed by the House Judiciary Committee Subcommittee on Intellectual Property.

H.R. 1858

H.R. 1858 was favored by the House Commerce Committee as a minimalist approach to database protection. The definition of database used in this bill is similar to that in H.R. 354, but it clearly excludes traditional literary works that tell a story or communicate a message. The bill prohibits wholesale duplication of a preexisting database but only if it was distributed in commerce. There is no duration clause in the bill, unlike H.R. 354's 15-year term. H.R. 1858 contains a set of exceptions such as news reporting, law enforcement activities, intelligence agencies, online stockbrokers, and online service providers. There is also an express exception for non-profit scientific, educational, or research activities.

The introduction of these bills and the rhetoric surrounding them highlight disputes not only between both sides of the database protection debate but also between the House Commerce and Judiciary Committees. The 106th Congress failed to enact database legislation because of this dispute and a lack of agreement about whether database legislation was needed at all. The EU is pressing for other countries to enact legislation similar to its Directive, which contains a reciprocity clause; EU countries would deny protection to foreign nationals or enterprises that have no base of operation in the EU unless their country of origin provides similar database protection for nationals of EU countries. This is referred to as national treatment, and it may compel the United States to enact some form of database protection.

The matter is once again being considered by Congress. Next month's column will address the current proposal, the Database and Collections of Information Misappropriation Act of 2003.

(1) 499 U.S. 340 (1991)

(2) Directive 96/9/EC of the European Parliament and the Council of 11 March 1996 on the legal protection of databases, 1996 O.J. (L77) 20.