In a congressional year that many expected to be slow, if not quiet, due to the presidential election and continuing partisan strains between Congress and the Obama administration, Congress still managed to enact more than 210 new laws, with nearly 20 approved during the post-election, lame duck session that ended in late December. Granted, a number of them are primarily housekeeping or ceremonial in nature, but others could have a significant impact on a wide variety of citizens and businesses.
Among the laws passed in 2016 are one ensuring that crisis hotlines for veterans get answered (PL 114-247), one acting as a “bill of rights” for survivors of sexual assault (PL 114-236), one strengthening the process for reviewing and testing chemicals for toxicity (PL 114-182), and one extending a grant program to fund bulletproof vests, particularly for female officers (PL 114-155).
Support for Trade Secrets
Several laws were also enacted that merit the attention of the information industry. Among the most important would likely be the Defend Trade Secrets Act of 2016 (PL 114-153), the most significant reform of trade secret law in decades. Often called the fourth category of intellectual property after copyrights, patents, and trademarks, trade secrets cover information whose economic value is in the secret itself. That information, which can include formulas, products or product plans, manufacturing processes, customer lists, etc., can be a protectable trade secret only if it is not generally known or easily determined by others. Trade secret law often works side by side with patent law in that trade secret law allows a company to protect its R&D activities that might lead to a patentable invention.
Trade secrets have been largely protected by state law. This has created difficulties for companies that must attempt to enforce their trade secrets in different states with different standards for determining what is or is not a trade secret, what steps must be taken to enforce trade secrets, and the procedures for recovering from the loss or theft of a trade secret. The problem becomes even more acute in protecting trade secrets internationally.
The Defend Trade Secrets Act created a new level of federal protection for trade secrets, which will make it easier to enforce them nationally. The act also allows for property related to stolen or misappropriated trade secrets to be seized by the government to prevent misuse, provides for triple damages for willful or malicious appropriation of trade secrets, and creates a standard 3-year statute of limitations on claims of trade secret theft or misuse. Provisions were also included to give employees the freedom to take the skills learned by working for one employer to another employer, balanced against limitations on using the trade secrets of the former employer for the benefit of the new employer.
FOIA Gets New Requirements
In June, the FOIA (Freedom of Information Act) Improvement Act of 2016 (PL 114-185)—described as the most comprehensive reform of FOIA in years—was signed into law. The original FOIA, enacted in 1966, provided citizens and businesses with the right to request that the government disclose records and documents. While it was a significant step toward a more open government, restrictions built within FOIA, along with episodes of often hostile or disinterested responses by federal agencies, have led to a climate of suspicion. Online access has raised the stakes as the ease through which documents can be made available only highlights circumstances when documents are restricted.
The FOIA Improvement Act added several new requirements to FOIA, including the necessity of providing electronic access to FOIA-requested documents and to permanently post frequently requested documents, creating a “presumption of openness” that would require records to be released absent foreseeable harm or a specific legal restriction, and eliminating the exemption for intra-agency communications on records that are more than 25 years old. The act also calls for the creation of a consolidated FOIA portal to provide a single point for FOIA requests to all agencies.
Other Important Laws and Bills
The 1,000-page 21st Century Cures Act (PL 114-255), passed in December, will likely have significant impact on the healthcare and information industries. The act is a comprehensive series of initiatives intended to spur the development and introduction of pharmaceutical and medical products, therapies, and devices. It includes nearly $5 billion in new funding for the National Institutes of Health, most of which will go toward direct and grant-funded research at public, private, and academic facilities. Data-sharing and patent developments will be likely outcomes of this. In addition, the act aims to improve healthcare delivery by setting new requirements for interoperability and the certification of health information technology.
Other congressional acts of interest to the information industry that were passed in 2016 include the Judicial Redress Act of 2015 (PL 114-126), which allows foreign citizens to sue selected U.S. government agencies for the unauthorized disclosure of records containing personal information, and the MEGABYTE Act of 2016 (PL 114-210), which requires agencies to develop comprehensive software licensing polices. In the final weeks of its session, Congress enacted the Consumer Review Fairness Act of 2016 (PL 114-258), which bans the use of so-called gag clauses to prohibit critical reviews of products or services, and the Better Online Ticket Sales (BOTS) Act of 2016 (PL 114-274), which bans the use of ticket-buying software.
Congress also enacted laws directing the Library of Congress to expand the formats it uses for providing access to books for the blind and physically disabled (PL 114-219) and reauthorizing the Sound Recording and Film Preservation Programs through FY2026 (PL 114-217). It saw the implementation of the Librarian of Congress Succession Modernization Act of 2015 (PL 114-86) when Carla Hayden was appointed by President Barack Obama to a fixed 10-year term as Librarian of Congress.
A Slow Process
Legislation—particularly complex legislation—can take years of work sessions, drafts, and hearings before being enacted into law. The America Invents Act of 2011, the most significant patent reform law of the 21st century (so far), was before Congress in its previous forms for nearly a decade before it was finally passed. Congress continues to explore additional patent reforms, primarily the Innovation Act (HR 9), which seeks to curtail patent litigation abuses and patent trolls. The bill saw significant work in 2015 and hearings in 2016, and this work will likely continue in the 115th Congress. While a number of copyright initiatives were introduced in 2015 and 2016, none were enacted, although work sessions and roundtables continue to be held on broader copyright reform legislation to update and perhaps replace the 40-year-old Copyright Act of 1976.
What to Expect From the 115th Congress and New President
Looming over all of this pending work—and even some completed work—was the extraordinary election of 2016. The Republican candidate was generally quiet on intellectual property and other issues of concern to the information industry. However, his presidency, along with the continuing Republican control of both houses of Congress, will in all probability shake up a number of actions and initiatives over the next 2–4 years.
The most significant impact of the change of administration is that for the first time in 10 years, there will be both a Republican Congress and a Republican presidential administration. The impact of this on future legislation and policy will be multi-fold. First, Republicans will remain in command of all House and Senate committees and congressional leadership, giving them enormous control over the legislative process and what legislation ultimately sees the light of day.
Second, Republicans will have less fear of a presidential veto. The presidential veto threat often gave the Obama administration and the Democratic minority in Congress some leverage, because their caucus had enough strength to sustain a veto.
Finally, the Republican presidential administration means that the leadership of virtually the entire executive branch will shift from Democratic to Republican. Departments including Justice, Commerce, Treasury, Defense, and Homeland Security will transition, as will commissions such as the Federal Communications Commission (FCC) and the Federal Trade Commission (FTC).
Commentators have had a field day speculating on areas of law and policy likely to be impacted by the election results. Prominent among them is Net Neutrality and the recently enacted broadband privacy rules. Publications as diverse as Bloomberg BNA, USA TODAY, and Inside Sources are projecting that Republican opposition at both the congressional and FCC levels will see Net Neutrality rules rolled back or possibly eliminated. FCC chairman Tom Wheeler, a Democrat appointed by President Obama and a champion of Net Neutrality and broadband privacy, already announced that he will step down from the FCC on Jan. 20. His successor will almost certainly be a Republican. And prior to his formal candidacy, the president-elect tweeted that Net Neutrality was an “attack on the internet” and a “top down power grab,” which indicates a lack of presidential support as well.
Other areas of law and policy that have been identified as ripe for renewed review and change include the Trans-Pacific Partnership—which ended up being a highly contentious campaign issue—and cybersecurity policy, including encryption and surveillance practices. This could reignite the battle over software “backdoors” into iPhones and other smart devices. Data sharing for government-sponsored research as well as in global commerce has been mentioned, as have consumer privacy considerations at the FTC and the FCC. While the president-elect did not focus on intellectual property during the campaign, there is some speculation that as a literally trademarked and licensed “brand,” he will be protective of intellectual property rights. There is also talk that the telecommunications industry might benefit from proposals to spend upward of $1 trillion on infrastructure.
The 115th Congress is installed on Jan. 3, 2017, and the new president will be inaugurated on Jan. 20.