Unlocking Consumer Choice and Wireless Competition Act

Mr. Speaker, I have a parliamentary inquiry.

I don't believe there is a rule for this bill. Is there a rule for this bill?

Mr. Speaker, I claim the time in opposition.

Mr. Speaker, I yield myself such time as I may consume, and I rise in opposition to the Unlocking Consumer Choice and Wireless Competition Act.

I support the sentiment behind this bill, and I support the version that was reported out of the Judiciary Committee. However, unfortunately, an important change that I will discuss to the detriment of this bill was added last week, just prior to this bill being brought to the floor.

The gentleman from Virginia (Mr. Goodlatte) gave some background with regard to why a bill is necessary. Ever since the Library of Congress ruled last year that unlocking your cell phone violates copyright law, there have been a number of us on both sides of the aisle who have worked to ensure that consumers have the right to unlock their wireless devices and use their property as they see fit.

I am proud to be a cosponsor of Congresswoman Lofgren's bill, the Unlocking Technology Act of 2013, which gives consumers the right to unlock their devices on a permanent basis.

Before I came to Congress, I was an entrepreneur who started a number of businesses, and I understand firsthand the importance of allowing a free market to thrive and to create a positive environment for businesses and consumers alike.

Allowing consumers to unlock their cell phones, which are their own personal property, can spur competition, allowing new start-up carriers to succeed, lowering prices, and increasing service options for all cell phone users.

To be clear, this is a separate issue from being contractually bound to use a certain provider for a certain period of time. Many Americans choose to enter into a long-term contract in exchange for discounts or free cell phones.

That is not the issue being discussed today, and I don't think there is a problem from either side of the aisle about those consensual contracts.

Rather, we are talking about unlocking cell phones that are not contractually bound to a certain service

provider. This has been an issue within our trade agreements.

I have recently drafted bipartisan letters to the United States Trade Representative, with Representative Massie, expressing concern that the leaked text of the Trans-Pacific Partnership agreement would potentially make any permanent fix to unlocking cell phones illegal.

Now, this bill is not a permanent fix. This bill would make clear congressional intent consistent with the optional agreement between the companies that they have reached. However, the last-minute change that was made in this bill, different from the bill that was passed out of committee, puts a real poison pill in this bill for consumer advocates, such as myself.

The bill adds the language that nothing in this subsection shall be construed to permit the unlocking of wireless handsets or other wireless devices for the purpose of bulk resale or to authorize the Librarian of Congress to authorize circumvention for such purpose or any other provision of law.

Now, while this gives, again, at least a patina of deniability that the bill is making a statement in one way or the other, the statement certainly implies that Congress believes that bulk unlocking is, in fact, illegal.

Now, why is bulk unlocking important? When it comes to the actual technical skills necessary, many consumers are not going to be unlocking their phones themselves. There needs to be a market in unlocked phones for consumers to have the full ability and to be empowered to choose the provider of their choice.

This bill does weigh in, with congressional intent, against the creation of a dynamic marketplace that increases consumer choice and options.

I think, without this clause, this was a bill that made it clear that we can't use the Digital Millennium Copyrights Act to interfere with an issue that is unrelated to copyright, but with this clause, it suggests that perhaps the DMCA's clauses can be used for noncopyright issues if, perhaps, somebody doesn't like the motive behind the unlocker.

So, as a result of this change, a number of organizations have withdrawn their support: iFixit, the Electronic Frontier Foundation, Public Knowledge, Generation Opportunity, and FreedomWorks.

I hope to be able to continue to work with colleagues on both sides of the aisle to improve this bill, but with the current language, I do not believe, at this point, that this bill is a step forward for consumers.

I reserve the balance of my time.

I yield 3 minutes to the gentleman from Virginia (Mr. Scott).

Mr. Speaker, I yield myself such time as I may consume.

In listening to the gentleman from California (Mr. Issa), there was a discussion of to what degree does this language interfere with potential and existing business models, and I agree with them. There are many workarounds. I think the danger here is invoking the language of copyright in an unrelated area.

To quote from Public Knowledge: this new language, even if Congress believes that bulk unlocking is a problem, it is clear that it is not a copyright problem. Just as individual unlocking is not a copyright problem, a bill designed to scale back overreaching copyright laws should not also endorse an overreach of copyright law.

I have a full statement from Public Knowledge that I will submit for the Record, Mr. Speaker. And as put by the Electronic Frontier Foundation, by expressly excluding bulk unlocking, this new legislation sends two dangerous signals: one, that Congress is okay with using copyright as an excuse to inhibit certain business models, even if the business isn't actually infringing on any of its copyrights; and, two, that Congress still doesn't understand the collateral damage section 1201 is causing.

For example, bulk unlocking not only benefits consumers, but it is also good for the environment. Unlocking allows reuse, and that means less electronic waste. I will be submitting the Electronic Frontier Foundation statement into the Record.

Again, the bill, as it passed committee, didn't weigh in on these matters of bulk unlocking and was satisfactory to consumer advocacy groups, including those that have now come out in opposition to this underlying bill.

Many of the arguments that the gentleman from Virginia (Mr. Goodlatte) made about the potential use of phones for criminal purposes may, in fact, be valid arguments and may, in fact, deserve policy responses, but not within the realm of copyright law.

They deserve appropriate attention within the realm of criminal law and perhaps might prevail upon the expertise of both of my colleagues from Virginia, who know far more about these matters than I.

But if there need to be harsher penalties or more enforcement within criminal law with regard to the illegal use of cell phones, whether locked or unlocked, or illicit transactions, that would be an appropriate venue.

But invoking copyright law is a very dangerous precedent for an unrelated area. We did reach a bipartisan consensus on this bill in July, but at the last minute after the bill was marked up and reported out, this new language was added to the bill that would have negative effects on consumers' ability to unlock their phones.

The new language specifically states that the bill does not apply to bulk unlocking. Now, that signals that Congress believes that it is illegal for companies, including many small businesses and start-ups, to unlock cell phones in bulk, again, as Mr. Issa pointed out, not binding language, not something that immediately would be used to prosecute a small business, but it would create greater uncertainty-- not less uncertainty--around unlocking of cell phones in bulk, which could make it more difficult for consumers to buy an already unlocked, used cell phone. Again, since many consumers lack the technical expertise themselves to unlock cell phones, we want to ensure that they have availability to purchase unlocked cell phones and use them with the carrier of their choice.

Again, this is an inappropriate use of copyright law to bar small businesses and large businesses from unlocking devices when it has nothing to do with making illegal copies of protected works, the purpose of copyright law. Again, if there is a criminal problem, we should address that within the realm of criminal law and enforcement, not within the realm of copyright.

My colleague, Congresswoman Lofgren, offered compromise language to Chairman Goodlatte, but she reports back that this language was rejected because it was provided too late in the process. Again, I wish that Congresswoman Lofgren and others were brought in earlier in the process. I think there was the general assumption among the advocates on my side of the bill and that encourage more consumer choice that the bill, as reported

from committee, would be the bill that was considered on the floor, as is traditionally done.

Unfortunately, we are not voting on that bill that had that bipartisan consensus in committee. The bill has changed, and the bill now can be perceived as picking sides with regard to congressional intent of application of copyright law for bulk unlocking, something that many of us see as a negative precedent with regard to consumer choice and overreach of using copyright law to protect incumbent advantages.

But, Mr. Speaker, it is never too late to reach a compromise. There is no rush to bring this bill to the floor today. There is a temporary agreement in place which offers consumers the same protections that are considered under this bill, and I hope that the chair and ranking member consider working to improve this bill so that it can pass this body unanimously. It doesn't need to be a controversial bill.

I fear that the bill currently before us, while, again, it enshrines some of the current protections that protect consumers that Mr. Chaffetz talked so passionately about, also, unfortunately, weighs in in applying copyright law in an unrelated area that can have the effect of restricting consumer choice.

I reserve the balance of my time.

Rep. Goodlatte Slips Secret Change Into Phone Unlocking Bill That Opens

the DMCA Up for Wider Abuse

(By Mike Masnick)

As you may recall, there's been a ridiculous (on many

levels) fight concerning the legality of ``unlocking'' mobile

phones. Let's go through the history first. Because of

section 1201 of the DMCA, the ``anti-circumvention''

provision, companies have been abusing copyright law to block

all sorts of actions that are totally unrelated to copyright.

That's because 1201 makes it illegal to circumvent basically

any ``technological protection measures.'' The intent of the

copyright maximalists was to use this section to stop people

from breaking DRM. However, other companies soon distorted

the language to argue that it could be used to block certain

actions totally unrelated to copyright law--such as unlocking

garage doors, ink jet cartridges, gaming accessories . . .

and phones. There have been court cases about a number of

these issues, with (thankfully) many courts ruling against

this kind of abuse, though it still happens.

Separately, every three years, the Librarian of Congress

gets to announce ``exemptions'' to section 1201 where it

feels that things are being locked up that shouldn't be. Back

in 2006, one of these exemptions involved mobile phone

unlocking. Every three years this exemption was modified a

bit, but in 2012, for unexplained reasons, the Librarian of

Congress dropped that exemption entirely, meaning that

starting in late January of 2013, it was possible to

interpret the DMCA to mean that phone unlocking was illegal.

In response to this there was a major White House petition--

which got over 100,000 signatures, leading the White House to

announce (just weeks later) that it thought unlocking should

be legal--though, oddly, it seemed to place the issue with

the FCC to fix, rather than recognizing the problem was with

current copyright law.

Following this, a slew of new bills were introduced in

Congress, many of which attempted to narrowly deal with the

specific issue, while leaving the larger issues untouched.

Many of these bills were incredibly problematic, though

eventually the consensus seemed to get behind one bill before

. . . nothing. Fast forward a year and nothing has changed,

though the main bill, supported by Rep. Goodlatte, called the

Unlocking Consumer Choice Act, is scheduled to go to a vote

on Tuesday. It had gone through the basic markup process and

some adjustments had been made to make it a good first step

towards fixing problems.

As of last week, a bunch of folks, who were concerned about

the issues with unlocking and how Section 1201 was a problem,

were supportive of this bill and were expecting to publicly

speak out in favor of getting the bill passed. Except . . .

late last week, with no explanation whatsoever, and no

consultation with others even though the markup and Judiciary

Committee process had already concluded, Rep. Goodlatte

slipped into the bill a little poison pill/favor to big phone

companies, adding a seemingly innocuous statement as section

(c)(2):

No Bulk Unlocking--Nothing in this subsection shall be

construed to permit the unlocking of wireless handsets or

other wireless devices, for the purpose of bulk resale, or to

authorize the Librarian of Congress to authorize

circumvention for such purpose under this Act, title 17,

United States Code, or any other provision of law.

While this gives Goodlatte and other maximalists some sort

of plausible deniability that this bill is making no

statement one way or the other on bulk unlocking, it

certainly very strongly implies that Congress believes bulk

unlocking is, in fact, still illegal. And that's massively

problematic on any number of levels, in part suggesting that

the unlocker's motives in unlocking has an impact on the

determination under Section 1201 as to whether or not it's

legal. And that's an entirely subjective distinction when a

bill seems to assume motives, which makes an already

problematic Section 1201 much more problematic. Without that

clause, this seemed like a bill that was making it clear that

you can't use the DMCA to interfere with an issue that is

clearly unrelated to copyright, such as phone unlocking. But

with this clause, it suggests that perhaps the DMCA's anti-

circumvention clause can be used for entirely non-copyright

issues if someone doesn't like the ``motive'' behind the

unlocker.

Given that, both Public Knowledge and EFF have pulled their

support for the bill. As Public Knowledge noted:

``The new language specifically excluding bulk unlocking

could indicate that the drafters believe that phone unlocking

has something to do with copyright law. This is not a

position we support. Even if Congress believes that bulk

unlocking is a problem, it's clear that it's not a copyright

problem, just as individual unlocking is not a copyright

problem. A bill designed to scale back overreaching copyright

laws should not also endorse an overreach of copyright law.''

EFF made a similar statement:

By expressly excluding [bulk unlocking], this new

legislation sends two dangerous signals: (1) that Congress is

OK with using copyright as an excuse to inhibit certain

business models, even if the business isn't actually

infringing anyone's copyright; and (2) that Congress still

doesn't understand the collateral damage Section 1201 is

causing. For example, bulk unlocking not only benefits

consumers, it's good for the environment--unlocking allows

re-use, and that means less electronic waste

Two members of Congress who have been closely associated

with these issues, Reps. Zoe Lofgren and Anna Eshoo, also

pulled their support of the bill late Monday as well,

expressing their clear outrage at how this change was slipped

in after the fact, in a letter sent to their colleagues in

the House:

After this bill was marked up and reported out of

committee, a new section was added to the bill without notice

to or consultation with us. . . .

They furthermore point out that it's ridiculous that

Congress is not fixing the broken anti-circumvention parts of

the DMCA, and could possibly be strengthening them with this

sneaky change of language:

In his concurring opinion in Lexmark v. Static Control

Components, Judge Merritt wrote: ``We should make clear that

in the future companies like Lexmark cannot use the DMCA in

conjunction with copyright law to create monopolies of

manufactured goods for themselves . . .'' The court's holding

prevented Lexmark from using dubious copyright claims and an

overboard reading of 17 USC 1201--the same section the

Unlocking Consumer Choice Act alters--to prevent third

parties from creating competing printer ink cartridges. The

issue is similar here.

Mr. Speaker, I would like to yield 2 minutes to the gentleman from Virginia (Mr. Scott) for purposes of a colloquy.

I would like to inquire, Mr. Speaker, as to how much time remains on both sides?

I yield myself such time as I may consume.

Again, there seems to be some strong, bipartisan consensus here that there remains more work to be done. As Representative Chaffetz said, we do need a long-term solution. We need to ensure that any solution we enter is not compromised by our Nation's trade agreements to ensure that consumers are protected in control of their own devices in choosing the plan that they desire.

The language in question that was added after the bipartisan consensus was reached in committee is not operative language. It is not language that criminalizes something that wasn't criminal before or proactively bans the bulk sale of phones. What it does explicitly do is establish some degree of congressional intent.

Perhaps this colloquy between the two gentlemen from Virginia helped roll back a part of what could be read in the congressional intent of this language, and I am appreciative of that effort. However, congressional intent could, nevertheless, be construed that there is an imprint, there is a congressional desire to use a more restrictive view of copyright, one in which copyright laws can be used to ban business practices that have nothing to do with making illicit copies of protected works.

Copyrights are a very important area of law. It is meant to protect the creator of a work from having their work ripped off and sold and others profit at their expense. However, it is difficult to see, and this is why so many of us were critical of the Librarian of Congress' initial decision. It is very difficult to see what the nexus is between unlocking cell phones and copyright.

By adding this language in, it adds some degree of congressional perception that copyright law can be what many of us feel to be abused in this manner that reduces consumer choice and does not protect any legitimate creator of a work. Again, to the extent there are concerns from police and law enforcement officials with regard to how unlocked or locked cell phones are being used for transactions that are otherwise illegal, that is a question of criminal law and enforcement and something that I would hope to be certainly supportive of efforts within Judiciary or Homeland Security or other committees to ensure that we reduce crime across all of those. But let's not give the court's ruling on these actions a reason to think that perhaps Congress condones them.

Again, having my colleagues on both sides of the aisle on the Record talking about how this bill is simply a first step and how we need to go further and, of course, not backing away from the initial committee markup of the bill, it is certainly also helpful in establishing congressional intent. And that is really what we are talking about here. We are not talking about binding language where before this bill passes somebody doesn't go to jail, after this bill passes they do. We are talking about potential use and precedent going forward with regard to how copyright law can, from my perception, be misapplied to reduce consumer choice in areas that are unrelated to the purpose of copyright protection.

That is why I continue to stand in opposition to this bill, certainly appreciating the step forward of enshrining in law potentially that it is no criminal penalty for an individual unlocking their own cell phone. But, again, we want to make sure it doesn't happen at the expense of moving the entire discussion in the wrong direction.

An opinion in yesterday's L.A. Times was headlined, ``The House's cell phone unlocking bill: Thanks but no thanks.'' I would like to submit the L.A. Times op-ed into the Record, Mr. Speaker.

I reserve the balance of my time.

[From the Los Angeles Times, Feb. 25, 2014]

The House's Cellphone Unlocking Bill: Thanks But No Thanks

(By Jon Healey)

How hard can it be for Congress to make it legal for

consumers to switch mobile networks without having to buy a

new phone?

Too hard, evidently.

The House is scheduled to vote Tuesday on a bill that was

supposed to clear the way for consumers to unlock the phones

they buy from wireless companies after they've fulfilled

their contracts. But the measure, which was modest to begin

with, has been rendered irrelevant by voluntary agreements on

unlocking that the Federal Communications Commission obtained

from the wireless companies. The bill was also changed at the

last minute in a way that arguably weakens consumers'

ownership rights, prompting some consumer advocates and

Democrats to withdraw their support.

The current version is so bad, consumers would be better

off if Congress did nothing at all.

At issue is a dubious interpretation of copyright law that

deters people from moving their phones from one network to

another. Each mobile carrier typically sells phones with

electronic locks that prevent them from being reprogrammed to

work on rival carriers' networks. The U.S. Copyright Office,

acting through the Librarian of Congress, ruled in 2012 that

removing the locks violated the 1998 Digital Millennium

Copyright Act, which forbids the circumvention of

technologies that protect copyrighted works.

The ruling was bizarre, considering that the locks inside

phones don't protect against

software piracy; their only real purpose is to protect the

mobile carriers' business model. And the carriers have (and

use) better tools to recover the subsidies they put into the

phones they sell, most notably contracts that impose hefty

early termination penalties.

The 1998 law requires the Librarian of Congress to revisit

the anti-circumvention rules every three years, which means

the Electronic Frontier Foundation and other consumer

advocates can try to set things right in 2015. Sadly,

however, the default interpretation of the cellphone locks is

that they are covered by the anti-circumvention ban.

The Copyright Office's decision, which took effect early

last year, led more than 100,000 people to petition the White

House for help. Tech-friendly lawmakers lined up to offer

bills, including an elegantly simple one by Sen. Amy

Klobuchar (D-Wis.) that would require mobile companies to let

customers unlock the wireless devices they buy, and a more

sweeping proposal by Sen. Ron Wyden (D-Ore.) to exempt

wireless device unlocking from the anti-circumvention ban.

The best of the bunch was a bill by Rep. Zoe Lofgren (D-San

Jose) and a bipartisan group of co-sponsors to limit the 1998

law's anti-circumvention rules to locks that protect against

piracy. That bill also would have declared that it was not

copyright infringement for the owner of a mobile device to

unlock it for the purpose of switching to another network.

The House, however, is scheduled to take up a different

measure Tuesday afternoon, H.R. 1123 by Judiciary Committee

Chairman Bob Goodlatte (R-Va.) and co-sponsors from both

parties. As introduced, it would simply have replaced the

Copyright Office's 2012 ruling with its decision in 2010 that

cellphone owners could unlock their phones without running

afoul of copyrights. It also would have called on the

Librarian of Congress to decide within a year whether to

extend the exemption to all other locked wireless devices,

such as tablets.

The relief offered by the bill would have remained in

effect only until the Librarian of Congress reviewed the

anti-circumvention rules again in 2015, so it hardly seemed

worth the effort. The version that the House is slated to

vote on Tuesday also includes a new provision effectively

barring devices from being unlocked in bulk for the purpose

of reselling them.

The latter change disturbed Lofgren (a member of

Goodlatte's committee) and fellow Silicon Valley Democrat

Anna Eshoo, who accused Republicans of adding the provision

in secret after the Judiciary Committee approved the bill.

The proposed ban on unlocking for the sake of resale, they

argued in a letter to colleagues Monday, is an inappropriate

use of copyright law to stop people from disposing of the

devices they buy as they please.

``Congress should work to roll back abusive practices that

use copyright law to prevent owners from having control over

the devices they lawfully own,'' Lofgren and Eshoo wrote.

``What it means to 'own' a device that has been purchased is

what's at stake here. The new addition to the bill puts the

effort to stand up for the property rights of the owners of

technology devices at risk.''

Public Knowledge, a technology advocacy group, agreed.

``Even if Congress believes that bulk unlocking is a problem,

it's clear that it's not a copyright problem, just as

individual unlocking is not a copyright problem,'' said

Sherwin Siy, the group's vice president of legal affairs. ``A

bill designed to scale back overreaching copyright laws

should not also endorse an overreach of copyright law.''

Both Public Knowledge and the Electronic Frontier

Foundation withdrew their support for the measure after the

new provision was disclosed last week.

The House plans to bring up HR 1123 under an expedited

procedure that forbids amendments but requires a two-thirds

vote to pass. With some luck, Lofgren and Eshoo can rally all

the supposedly tech-friendly members in the chamber to knock

the bill off track.

As you may recall, there's been a ridiculous (on many

levels) fight concerning the legality of ``unlocking'' mobile

phones. Let's go through the history first. Because of

section 1201 of the DMCA, the ``anti-circumvention''

provision, companies have been abusing copyright law to block

all sorts of actions that are totally unrelated to copyright.

That's because 1201 makes it illegal to circumvent basically

any ``technological protection measures.'' The intent of the

copyright maximalists was to use this section to stop people

from breaking DRM. However, other companies soon distorted

the language to argue that it could be used to block certain

actions totally unrelated to copyright law--such as unlocking

garage doors, ink jet cartridges, gaming accessories . . .

and phones. There have been court cases about a number of

these issues, with (thankfully) many courts ruling against

this kind of abuse, though it still happens.

Separately, every three years, the Librarian of Congress

gets to announce ``exemptions'' to section 1201 where it

feels that things are being locked up that shouldn't be. Back

in 2006, one of these exemptions involved mobile phone

unlocking. Every three years this exemption was modified a

bit, but in 2012, for unexplained reasons, the Librarian of

Congress dropped that exemption entirely, meaning that

starting in late January of 2013, it was possible to

interpret the DMCA to mean that phone unlocking was illegal.

In response to this there was a major White House petition--

which got over 100,000 signatures, leading the White House to

announce (just weeks later) that it thought unlocking should

be legal--though, oddly, it seemed to place the issue with

the FCC to fix, rather than recognizing the problem was with

current copyright law.

Following this, a slew of new bills were introduced in

Congress, many of which attempted to narrowly deal with the

specific issue, while leaving the larger issues untouched.

Many of these bills were incredibly problematic, though

eventually the consensus seemed to get behind one bill

before... nothing. Fast forward a year and nothing has

changed, though the main bill, supported by Rep. Goodlatte,

called the Unlocking Consumer Choice Act, is scheduled to go

to a vote on Tuesday. It had gone through the basic markup

process and some adjustments had been made to make it a good

first step towards fixing problems.

As of last week, a bunch of folks, who were concerned about

the issues with unlocking and how Section 1201 was a problem,

were supportive of this bill and were expecting to publicly

speak out in favor of getting the bill passed. Except... late

last week, with no explanation whatsoever, and no

consultation with others even though the markup and Judiciary

Committee process had already concluded, Rep. Goodlatte

slipped into the bill a little poison pill/favor to big phone

companies, adding a seemingly innocuous statement as section

(c)(2):

No Bulk Unlocking--Nothing in this subsection shall be

construed to permit the unlocking of wireless handsets or

other wireless devices, for the purpose of bulk resale, or to

authorize the Librarian of Congress to authorize

circumvention for such purpose under this Act, title 17,

United States Code, or any other provision of law.

While this gives Goodlatte and other maximalists some sort

of plausible deniability that this bill is making no

statement one way or the other on bulk unlocking, it

certainly very strongly implies that Congress believes bulk

unlocking is, in fact, still illegal. And that's massively

problematic on any number of levels, in part suggesting that

the unlocker's motives in unlocking has an impact on the

determination under Section 1201 as to whether or not it's

legal. And that's an entirely subjective distinction when a

bill seems to assume motives, which makes an already

problematic Section 1201 much more problematic. Without that

clause, this seemed like a bill that was making it clear that

you can't use the DMCA to interfere with an issue that is

clearly unrelated to copyright, such as phone unlocking. But

with this clause, it suggests that perhaps the DMCA's anti-

circumvention clause can be used for entirely non-copyright

issues if someone doesn't like the ``motive'' behind the

unlocker.

Given that, both Public Knowledge and EFF have pulled their

support for the bill. As Public Knowledge noted:

``The new language specifically excluding bulk unlocking

could indicate that the drafters believe that phone unlocking

has something to do with copyright law. This is not a

position we support. Even if Congress believes that bulk

unlocking is a problem, it's clear that it's not a copyright

problem, just as individual unlocking is not a copyright

problem. A bill designed to scale back overreaching copyright

laws should not also endorse an overreach of copyright law.''

EFF made a similar statement:

By expressly excluding [bulk unlocking], this new

legislation sends two dangerous signals: (1) that Congress is

OK with using copyright as an excuse to inhibit certain

business models, even if the business isn't actually

infringing anyone's copyright; and (2) that Congress still

doesn't understand the collateral damage Section 1201 is

causing. For example, bulk unlocking not only benefits

consumers, it's good for the environment--unlocking allows

re-use, and that means less electronic waste

Two members of Congress who have been closely associated

with these issues, Reps. Zoe Lofgren and Anna Eshoo, also

pulled their support of the bill late Monday as well,

expressing their clear outrage at how this change was slipped

in after the fact, in a letter sent to their colleagues in

the House:

After this bill was marked up and reported out of

committee, a new section was added to the bill without notice

to or consultation with us. . . .

They furthermore point out that it's ridiculous that

Congress is not fixing the broken anti-circumvention parts of

the DMCA, and could possibly be strengthening them with this

sneaky change of language:

In his concurring opinion in Lexmark v. Static Control

Components, Judge Merritt wrote: ``We should make clear that

in the future companies like Lexmark cannot use the DMCA in

conjunction with copyright law to create monopolies of

manufactured goods for themselves . . .'' The court's holding

prevented Lexmark from using dubious copyright claims and an

overboard reading of 17 USC 1201--the same section the

Unlocking Consumer Choice Act alters--to prevent third

parties from creating competing printer ink cartridges. The

issue is similar here.

Congress should work to roll back abusive practices that

use copyright law to prevent owners from having control over

the devices they lawfully own. What it means to ``own'' a

device that has been purchased is what's at stake here. The

new addition to the bill puts the effort to stand up for the

property rights of the owners of technology devices at risk.

It is sad that the bipartisan consensus reached during

mark-up in the Judiciary

committee to improve the law has been destroyed by a secret

decision of the majority after the bill was reported out.

Unfortunately, the bill was deemed so uncontroversial that

it's been listed on the suspension calendar of the House,

which is where non-controversial bills are put to ensure

quick passage. That means that, not only did Goodlatte slip

in a significant change to this bill that impacts the entire

meaning and intent of the bill long after it went through the

committee process (and without informing anyone about it),

but he also got it put on the list of non-controversial bills

to try to have it slip through without anyone even noticing.

Either way, it seems that even if the bill does pass, it

won't do anything to fix a very broken part of the DMCA and,

in fact, could make it somewhat worse. Politics as usual when

it comes to anything having to do with copyright.

Mr. Speaker, I am prepared to close, and I yield myself the balance of my time.

I am heartened by the discussion on both sides of the aisle with regard to the path forward. I wish we could be at a better place today. I think we had a bill that was reported out of committee that would not have engendered, I don't believe, any degree of controversy here on the floor of the House.

We have now moved to a place where the bill does invoke some degree of appropriate controversy and some degree of appropriate opposition. I would advance that it is never too late to reach a compromise, either before this bill is voted upon--perhaps my colleague, Mr. Goodlatte, will be willing to consider Ms. Lofgren's language change--or after this bill passes. I think that we would all agree that this issue is not one in any way, shape, or form that is being put to bed here today.

I would hope that, as a guiding principle, Members on both sides of the aisle look to consumer choice and the power of markets to achieve the best outcome and ensure that incumbents don't seek to co-opt copyright law to the detriment of our economy and the detriment of consumer choice.

Again, this bill has language that can be construed as applying copyright law in another area and having a congressional blessing to do so, which is why I encourage my colleagues to join Electronic Frontier Foundation, Public Knowledge, Generation Opportunity, FreedomWorks, and iFixit, and some of those very organizations that were in the forefront of proposing that we pass a bill that allows unlocking that have since withdrawn their support from this bill because of the last-minute changes, which I saw for the first time yesterday and that I wish this House had a bigger opportunity to vet, perhaps bringing this bill forward under a rule if the suspension motion fails.

If a third of the Members of the House oppose, we would have an opportunity to remedy this bill under a rule that was hopefully structured to allow for compromise language that would then allow the bill to proceed with near unanimity. I hope my colleagues on both sides of the aisle see that as an opportunity, certainly not as a rebuke to the chair and ranking member on the committee. We appreciate the direction and the intent behind this bill, their desire to make sure that Americans know that they are not under duress or a criminal threat if they are unlocking their own cell phone. That is a sentiment that both the chair and the ranking member have echoed passionately, but I think we can do better with regard to ensuring that this bill is also not a precedent for the use of overreaching copyright law and a congressional blessing to do so in a way that hampers the trade, the bulk trade of unlocked cell phones which offer great potential benefits to the marketplace and to consumers.

So I urge my colleagues to vote ``no'' on this suspension bill, to consider working with both sides to get to ``yes,'' and to move in a direction that we look at as a guiding principle, ensuring that consumers and the marketplace are allowed to fully operate without the co-option of copyright law to protect incumbents.

I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 1123) to promote consumer choice and wireless competition by permitting consumers to unlock mobile wireless devices, and for other purposes, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous materials on H.R. 1123, currently under consideration.

Mr. Speaker, I yield myself such time as I may consume.

Last winter, due to an expired exemption to existing law, consumers lost the legal right to unlock their cell phones so that they could use them on a different wireless carrier. Outraged consumers flooded Congress and the White House with complaints over this change in policy that resulted in reduced marketplace competition.

In response to this impact on consumers, a bipartisan group of House Judiciary Committee members introduced H.R. 1123, the Unlocking Consumer Choice and Wireless Competition Act. The legislation reinstates the prior exemption to civil and criminal law for unlocking cell phones for personal use. It also creates an expedited process to determine whether this exemption should be extended to other wireless devices such as tablets.

When this legislation is enacted, consumers will be able to go to a kiosk in the mall, get help from a neighbor, or see a wireless carrier to help unlock their cell phone without any risk of legal penalties. This is not the case today, which is why this legislation is necessary.

H.R. 1123 is supported by such diverse groups in the cellular industry, from the large carriers of CTIA to the small carriers of the Competitive Carriers Association.

Although these two groups announced a private sector agreement in December on unlocking based upon this same legislation, that agreement cannot eliminate the potential of civil and criminal sanctions for consumers who unlock their cell phones. So the need for the legislation remains. Even Consumers Union supports this critical legislation.

The committee has been aware of law enforcement concerns regarding the explosive growth in smartphone thefts. Efforts by criminals to undertake bulk unlocking and transfers of stolen phones are a growing concern in America. Smartphones seem to have become crime magnets in many cities across America.

Because the policy issue has always focused on the ability of consumers to unlock their phones, the legislation is similarly focused on individual consumer unlocking without raising law enforcement concerns. Why would it make sense for Congress to enable criminal gangs to more easily make money off stolen phones instead of simply solving the main issue of consumers being able to unlock their own phones?

Some would like this legislation to go even further. However, I hope all can agree that this is a good start and a solid piece of legislation that will empower consumer choice.

I urge my colleagues to support this important proconsumer legislation, and I reserve the balance of my time.

Mr. Speaker, at this time, it is my pleasure to yield 3 minutes to the gentleman from California (Mr. Issa), the chairman of the Oversight and Government Reform Committee.

Will the gentleman yield?

Mr. Speaker, I yield an additional 1 minute to the gentleman from California.

I thank the gentleman for yielding.

Mr. Speaker, on the very point that the gentleman from California just raised, I will submit a letter for the Record from the Small Business & Entrepreneurship Council, representing many small businesses and entrepreneurs around America and endorsing this legislation.

I would also like to note that the Consumers Union of America and the Competitive Carriers Association, which are the small telecommunications companies that have to compete with the big behemoths, would both be concerned about their ability to compete in this very area; but they both support this legislation as well, the Consumers Union representing consumers and small businesses, and the SBE representing small businesses and entrepreneurs.

SBE Council,

Vienna, VA, February 24, 2014.

Hon. Bob Goodlatte,

Chairman, Committee on the Judiciary, Washington, DC.

Dear Chairman Goodlatte: The Small Business &

Entrepreneurship Council (SBE Council) is pleased to support

H.R. 1123, the Unlocking Consumer Choice and Wireless

Competition Act of 2013. Entrepreneurs require flexibility to

successfully run their businesses, and they certainly support

the freedom and choice provided by H.R. 1123.

H.R. 1123 repeals a Library of Congress (LOC) rulemaking

determination regarding the circumvention of measures

controlling access to copyrighted software on wireless

telephone handsets for the purposes to connecting to other,

different wireless handsets. This means entrepreneurs and

small businesses can easily switch to another carrier once

their contracts expire on their cell phones or tablets.

H.R. 1123 is a common sense measure that aligns government

policies with the flexibility the 100,000 members of SBE

Council need. We look forward to working with you to advance

Mr. Speaker, at this time, it is my pleasure to yield 2 minutes to the gentleman from Utah (Mr. Chaffetz), a member of the Judiciary Committee.

Mr. Speaker, I yield myself 1 minute to say to the gentleman from Colorado, I understand that you would like to see copyright law changed. But the fact of the matter is this is copyright law, and so the fact of the matter is right now consumers cannot legally unlock their phones, and we need to fix that problem. We have been working to do it.

I have worked very closely with the ranking member of the full committee and the ranking member of the subcommittee on the Judiciary Committee so that this change that was made is bipartisan. It should come as a surprise to no one because we, in fact, discussed this during the markup of the bill in the committee. When we did discuss that, we said we would continue to work with Members moving forward, and we came up with language that is bipartisan.

It is also supported, by the way, by Senator Leahy and Senator Grassley in the United States Senate. This is a bipartisan and bicameral compromise to move this legislation forward to address the concerns of organizations like the American Consumers Union supporting this legislation, the Small Business & Entrepreneurship Council, the Competitive Carriers Association, the CTIA, and also, importantly----

I yield myself an additional 30 seconds. I will read very briefly from the letter from the National Fraternal Order of Police.

It says: ``As Congress contemplates legislation to facilitate lawful unlocking by individuals, either for themselves or for devices on a family plan, we urge you to retain the prohibition on bulk unlocking consistent with both the 2010 and 2012 decisions from the Copyright Office. We believe that maintaining this prohibition will reduce smartphone thefts because the criminal sale of these devices will no longer be as profitable.''

I reserve the balance of my time.

That is correct. This legislation is not intended to impair unlocking related to family plans consisting of a small number of handsets or of used phones by legitimate recyclers or resellers. The objective of this savings clause is to make it clear that the legislation does not cover those engaged in subsidy arbitrage or in attempting to use the unlocking process to further traffic in stolen devices.

That is correct.

Mr. Speaker, at this time, it is my pleasure to yield 2 minutes to the gentleman from Georgia (Mr. Collins), a member of the Judiciary Committee.

Mr. Speaker, I am the last speaker remaining on our side. I believe I have the right to close, so if the gentleman has anything else he would like to say.

Mr. Speaker, I yield myself the balance of my time.

I would just say to the gentleman from Colorado, I understand his larger aspirations with regard to changes in copyright law. The committee recognizes that our copyright laws have not been amended in 40 years, and that we are conducting a comprehensive review. We have held many hearings on copyright issues already. We have many more planned, and we are going to continue that work, but this small bill to protect the rights of consumers on cell phone unlocking does not meet his aspirations to try to use it as a vehicle for greater things being done here because it is intended to be a narrow fix to a problem that was created when the Register of Copyrights did not take the necessary steps to allow the continued unlocking of cell phones.

So it has taken a great deal of bipartisan work on the part of the ranking member and myself; the ranking member of the subcommittee, who had objections to the bill as reported out of the committee, has since left Congress, and the new ranking member has signed off on the change that was made here to bring organizations like the Fraternal Order of Police into acceptance of this, and we still have the support of important consumer organizations, like Consumers Union, as well as the cell phone industry organizations. As a result, this legislation needs to move forward as it is today.

The savings clause that the gentleman objects to is meant to make it clear that this is focused on consumers and not on the larger issues. If enacting in one area as we are in this very narrow, targeted bill, we sent a signal in another area, and a signal is what the gentleman identifies, we would never enact anything. So it is important that we address what is in this bill, the language that was worked out in the committee, that was discussed in the committee, that was then worked out further as the bill was reported to the floor, and pass this legislation today, and we can work on these broader issues in the future, but in the meantime, we need to protect the rights of our consumers to unlock the phones that they own when they purchase a used cell phone.

I am happy to yield briefly to the gentlewoman.

Reclaiming my time, what the gentlewoman says is, indeed, true; that there is a private agreement, but that private agreement cannot and does not mitigate the fact that the act of unlocking a cell phone carries with it a felony penalty under the law, and that is absolutely ridiculous. So this legislation needs to be passed, and we can then move on to have the larger debate about the importance of cell phone unlocking--or rather, section 1201 of the DMCA, and other issues as we move forward on various copyright issues in the committee, but now is not the place, now is not the time to have that debate.

This simple, bipartisan legislation should be passed by the House. I urge my colleagues to support the legislation.

I yield back the balance of my time.

Mr. Speaker, I rise today to recognize passage of several pieces of legislation during the week of February 24, 2014. Unfortunately, I was not able to vote for final passage of these bills because I was out on medical leave recovering from much needed hip replacement surgery.

H.R. 1211, the FOIA Oversight and Implementation Act of 2014, is important legislation that increases transparency and streamlines the process for requests of public information disclosures under the Freedom of Information Act. This legislation passed through one of my committees, the House Oversight and Government Reform Committee, with my support.

H.R. 1123, the Unlocking Consumer Choice and Wireless Competition Act, is a bill that reverses a previous Library of Congress rule that made the unlocking of cell phones illegal after the FCC and industry had agreed that consumers had every right to unlock their phones. It also directs the Library of Congress to issue a rule to determine whether consumers should be allowed to unlock similar devices, such as tablets.

H.R. 1944, the Private Property Rights Protection Act, is a bill to remedy a Supreme Court decision, Kelo v. New London, regarding governments' eminent domain powers. This legislation is very similar to one passed in the 112th Congress, which passed by voice vote. I am a strong supporter of private property rights and I agree 100 percent with the sense of Congress stated in this legislation that it should be ``the policy of the United States to encourage, support, and promote the private ownership of property and to ensure that the constitutional and other legal rights of private property owners are protected by the federal government.''

H.R. 3865, the Stop Targeting of Political Beliefs by the IRS Act, is an incredibly important piece of legislation designed to prevent the IRS from adopting a proposed rule that changes the way 501(c)(4) organizations are allowed to operate under the tax code. As the Oversight Committee noted in its hearing this week, this rule is tantamount to ``doubling down'' on the discriminatory practices against conservative groups that were uncovered in 2013. I strongly support this bill.

H.R. 2804, the All Economic Regulations Are Transparent Act, is a bill that requires federal agencies to further disclose and report on much of their processes and rules. One of my favorite provisions of this bill is that agencies and Washington bureaucrats pushing forth new regulations have to assess and disclose the costs that their proposed rules will have on small businesses and the economy. If the rules are going to be made, they should have a sound basis and fully consider the economic impact. This bill accomplishes those goals and has my support.

H.R. 3193, the Consumer Financial Protection and Soundness Improvement Act, makes a series of changes to the Consumer Financial Protection Bureau (CFPB) to rein in much of its autocratic authority. It will replace the Director of CFPB with a five member independent commission; it makes CFPB subject to the regular authorization and appropriations process; it requires the CFPB to use the GS pay scale like other federal agencies; and it prohibits the CFPB from accessing or using personal financial data of a consumer without express permission. I support reining in the unchecked authorities of the CFPB and support this legislation.

H.R. 899, the Unfunded Mandates Information and Transparency Act, is a bill that, among other things, enhances the ability of the public to identify federal mandates that may impose additional costs to citizens, workers, businesses, as well as State, local, and tribal governments. I am a firm believer that the Federal Government must not crush the smaller guy with undue burdens and mandates. I strongly support this important legislation.

Had I been present for these votes, I would have voted in support of these three important bills with an ``aye'' vote on rollcall Nos. 63, 64, 67, 69, 78, 85 and 90.

I thank the chairman.

Mr. Speaker, when I was alerted as to this change, like Mr. Polis, I asked, What will be the impact? And, at first glance, I was concerned that it could be a poison pill, that it could limit the ability, for example, for somebody to take trade-ins of thousands of phones and unlock them, but I found no such case because they are buying from an individual.

At that moment, they choose to unlock it as part of the arrangement, and you now have an unlocked phone. There is no prohibition on buying 500 unlocked phones and selling 500 unlocked phones.

As a matter of fact, when I went through the language of bulk sales, I could find essentially no possible business plan that would require the unlocking of bulk phones, except as to buying from a wholesaler who did not intend them to be unlocked, intended them to be sold individually, unlocking them, and then selling them off to another party.

Any transaction in which the product gets to an individual or in which unlocking occurs at the time of the individual is fully covered by this bill.

So although I did share the concern of the gentleman from Colorado (Mr. Polis) that there was a scenario in which somebody would not be able to unlock a phone, I discovered that there was nothing that the consumer would be affected by that could possibly affect this.

For example, let me say that, hypothetically, I am that individual, that company, and Mr. Polis and I have something in common, which is we both ran companies. If I am an individual and I want to buy 1,000 locked phones, there is going to be an easy unlock capability. Third parties are going to be able to provide the unlock capability.

I can buy 1,000 locked phones or 100,000 locked phones. I can sell them to somebody else, who sells them to somebody else. Anytime that company or individual is down to the end user who wants to unlock a phone, that capability is there.

Mr. Polis is one of the most intelligent and knowledgeable and trained people in this area of anyone in Congress, but if we go through each of the workarounds that we, in business, would do, I can find no scenario whatsoever in which this would stop the consumer from receiving an unlocked phone, if they chose to, even if, in the interim basis, there were many transactions of 10 or 100,000 phones of bulk sale.

It does not prevent the sale of unlocked bulk phones being sold and resold. It does not prevent the bulk sale of locked phones. So you only have to ensure, as I understand the law--and I have checked it against the language--that the unlocking occurs in support of the consumer.

So though I share the opposition's concern, I believe--I have looked through, vetted it, and like Mr. Polis, as a businessman, I have found that it stops no business plan and hurts no consumer.

I thank the chairman for bringing this legislation. I urge its support.

I yield to the gentleman from Virginia.

Thank you, Mr. Chairman.

Mr. Speaker, again, as we come here to talk about this, I join and associate myself with the gentleman from Utah and also the other comments that have been made here. We are looking to protect consumers. I enjoy the opportunity to go forward and look at an issue which we are supportive of: consumer choice.

As a member of the Judiciary Committee's IP Subcommittee, I believe if a consumer has met their contractual obligations with a service provider, then they should have the right to unlock and use the device with another carrier.

Our Nation's intellectual property law should prioritize three things: innovation, creation, and competition. Frankly, holding consumers hostage to their carrier fails to pass the smell test in this category.

We live in an age where consumers want choice, access, and freedom. Although carriers may have to evolve and develop to address the changes that this legislation may have on their business models, I am confident that any changes made will only better serve the consumer and promote competition.

It is with that in mind that I understand the gentleman from Colorado, and I understand the thought, because I actually had passed and do support the larger measure that came out of the Judiciary Committee. But also, in taking into account, there is a process here in which I believe that immediate help to consumers is the bigger issue and would be willing and will work, as I have stated before, for the larger measures that have been talked about here before. However, to hold this bill as it is and say this is not something to move forward on I can't accept and would urge all Members to accept this bill. It is a process of moving forward.

I do not believe that there is picking sides here. In fact, what I believe is happening here is we are protecting consumers and moving the discussion down the line. That is what we are sent here to do, and I believe this is a good balance between the two.

I respect the gentleman from Colorado and, Mr. Speaker, believe that we can work further on this, but this is a bill that needs to be passed today so we can move on and protect our consumers.

Mr. Chairman, I appreciate your work and the work of the committee in doing so. This is a matter of consumers, this is a matter of choice, and we need to make sure that this body stands for that.