The COVID-19 Stimulus Bill Would Make Illegal Streaming a Felony

Providing relief via direct assistance and loans to struggling individuals and businesses hit hard by COVID-19 has been a priority for federal lawmakers this past month. But a gigantic spending bill has also become the opportunity to smuggle in some other line items, including those of special interest to the entertainment community.

Perhaps most surprising, according to the text of the bill (a combination of COVID relief and annual government spending), illegal streaming for commercial profit could become a felony.

It's been less than two weeks since Sen. Thom Tillis released his proposal to increase the penalties for those who would dare stream unlicensed works. In doing so, the North Carolina Republican flirted with danger. About a decade ago, Sen. Amy Klobuchar (D-Minn.) made a similar proposal before it ended up dying as people worried about sending Justin Bieber to jail. (No, seriously.) But Tillis' attempt has been winning better reviews for more narrowly tailoring the provisions toward commercial operators rather than users. That said, it's had very little time to circulate before evidently becoming part of the spending package. If passed, illegal streaming of works including movies and music tracks could carry a penalty of up to 10 years in jail.

That's not the only change to copyright law, either.

The spending bill also appears to adopt a long-discussed plan to create a small-claims adjudication system within the U.S. Copyright Office.

Advocates have long sought to give copyright owners some recourse to infringement outside of the expensive federal court system, though the so-called CASE Act has engendered some pushback from those weary of throwing certain disputes to unaccountable bureaucrats working for an agency suspected of favoring industry. Some critics believe the alternative dispute system to be unconstitutional, though by making the system opt-in and non-compulsory, advocates hope that it will survive any legal challenge and ultimately lead to swifter resolution over takedown notices for copyright material posted online. The CASE Act previously passed the House by a 410-6 vote before being blocked in the Senate by Ron Wyden (D-Ore.).

Among the other parts of the omnibus bill of interest to Hollywood is an extension of Section 181, a tax provision that allows for immediate deduction of television and film production costs up to $15 million. That incentive was scheduled to expire at the end of the year, but would now get an additional five years. (More analysis on that coming.)

UPDATE: On Monday night, lawmakers voted in favor of the package.

The Motion Picture Association of America cheered the outcome. The trade group said in a statement, "We are encouraged that this legislation includes an expanded employee retention credit, a grant for movie theaters and an extension of the federal film, television, and live theatrical incentive. We are also pleased that the package includes the Protect Lawful Streaming Act, which protects creators, innovators, and consumers by ensuring that operators of commercial pirate streaming services face meaningful criminal penalties in appropriate circumstances.”