As has been reported elsewhere, the US Department of Justice responded rather critically to S.3325. The EFF has a copy of the letter. There are two principle complaints: first, that the DoJ has better things to do with public funds than provide pro bono legal representation for rights holders in enforcement actions; and second, that the mandated U.S. Intellectual Property Enforcement Coordinator (IPEC) office "constitutes a legislative intrusion into the internal structure and composition of the President's Administration."
The letter concludes: "It is our hope that changes will be made so that the President's senior advisors can recommend that the President support the measure." This is, of course, a veto threat. The fact that the letter was co-signed by Lilly Fu Claffee, General Counsel of the US Department of Commerce, can only be seen to underline the force of this threat. This was a strong signal from the administration that the bill would not be acceptable in that form.
The US Senate responded to the first complaint, by dropping that section entirely. The amended S.3325, now called the Prioritizing Resources and Organization for Intellectual Property Act of 2008, no longer authorizes the Attorney General to pursue civil actions on behalf of the rights-holders. This amended bill passed unanimously in the Senate on Friday, September 26, 2008, and now has been moved over to the House of Representatives, where it is on the suspension calendar as a postponed suspension vote and thus could potentially be passed in a matter of minutes, under the procedural rules. (Exactly how this bill qualifies for suspension under the $100 Million threshold, when it contains, by my count, $275 M of appropriations in Title IV and an unbounded ("such sums as may be necessary to carry out this title") appropriation in Title III, isn't clear to me. But then that threshold is not in the House rules; it's something the parties impose on themselves.)
The amended bill does nothing to address the second complaint, and is presumably still "objectionable on constitutional separation of powers grounds" to the Bush administration. Whether this is sufficient on its own to doom this version of the bill remains to be seen. Naturally, the other parts of the bill also remain, including the seizure powers, the increased statutory damages, and the $125 M appropriation for the enhancement of local enforcement activities. RIAA Chairman and CEO Mitch Bainwol is reportedly pleased with this, saying "Additional tools for intellectual-property enforcement are not just good for the copyright community but for consumers who will enjoy a wider array of legitimate offerings."
Public Knowledge issued a statement, saying in part "At a time when the entire digital world is going to less restrictive distribution models, and when the courts are aghast at the outlandish damages being inflicted on consumers in copyright cases, this bill goes entirely in the wrong direction." The comment about the courts is presumably a reference to the recent appeal decision ordering a new trial for Jammie Thomas, which described the statutory damage award in that case as "unprecedented and oppressive," and noted that "it would be a farce to say that a single mother’s acts of using Kazaa are the equivalent, for example, to the acts of global financial firms illegally infringing on copyrights in order to profit in the securities market." (my emphasis) (See also Howard Knopf's comments on this case here.)
From the Canadian perspective it is worth pointing out that one of the stated purposes of the IPEC office would be to pressure foreign governments to "establish international standards and policies for the effective protection and enforcement of intellectual property rights." Notably, sec. 303(a)(7)(C) would mandate "building a formal process for consulting with companies, industry associations, labor unions, and other interested groups in other countries with respect to intellectual property enforcement." Clearly, the opinions of citizens (of any country) are of little importance, except to the extent that they belong to "interested groups". And groups that would advocate for user's rights--like the Canadian Library Association, for example--are of secondary concern at best.
UPDATE: S.3325 was passed by the House of Representatives, shortly after 4:30 pm, in a vote of 381 yeas to 41 nays (11 not voting). It remains to be seen whether President Bush will sign it, or whether the two-thirds majority support (which is currently present in both houses of Congress) would still be there to override a veto.