Homeland Security's Crackdown on Websites Trafficking Counterfeit Goods Raises Alarms

Department of Homeland Security has seized more than 80 domain names since November – shutting down websites it alleges have been trafficking in counterfeit goods.

Attorney General Eric Holder says the bogus merchandise, including fake purses and prescription drugs, are harming the U.S. economy and endangering American lives. “When fake goods find their way into our nation's marketplaces, the health and safety of our people can be severely compromised,” Holder said at a White House forum on intellectual property theft.

While the aim may be noble, some within the tech industry say they are concerned that the government can get an order from a federal magistrate and shut down a website without ever contacting the owner.

“You start with kind of a ‘presumed guilty’ kind of approach because really there's nobody, there's no opportunity to stand up and say, ‘Now wait a minute, my site's just fine,’” David Sohn, of the Center for Democracy and Technology, warned. Under current law, domain name owners can challenge seizure of their websites in an administrative hearing after the fact.

If Sen. Patrick Leahy, D-Vt., succeeds, the Justice Department would have enhanced powers to do even more. He has introduced the Combating Online Infringement and Counterfeits Act, which has broad, bipartisan support. It would allow the Justice Department to get expedited orders for shutting down domestic websites and to have the power to order U.S.-based companies to re-route consumer traffic away from offending foreign websites.

Former Assistant Attorney General Tom Dupree says the law “gives our law enforcement agencies the tools necessary to stop these sort of counterfeiting operations, many of which operate abroad.”

Sen, Ron Wyden, D-Ore., is not a fan of the Leahy proposal and has said he will work to block passage of the bill. In Wyden’s estimation, “deploying this statute to combat online copyright infringement seems almost like using a bunker-busting cluster bomb, when what you need is a precision-guided missile."

The measure will essentially be nullified if not passed before the term of the 111th Congress expires Jan. 4, 2011. Wyden underwent successful prostate cancer surgery Monday, and it is unclear when he may return to the Senate – or if the Leahy bill will make it to the floor for a full Senate vote before Christmas.