[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1417 Introduced in House (IH)]







108th CONGRESS
  1st Session
                                H. R. 1417

To amend title 17, United States Code, to replace copyright arbitration 
 royalty panels with a Copyright Royalty Judge, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 25, 2003

     Mr. Smith of Texas (for himself, Mr. Berman, and Mr. Conyers) 
 introduced the following bill; which was referred to the Committee on 
                             the Judiciary

_______________________________________________________________________

                                 A BILL


 
To amend title 17, United States Code, to replace copyright arbitration 
 royalty panels with a Copyright Royalty Judge, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Copyright Royalty and Distribution 
Reform Act of 2003''.

SEC. 2. REFERENCE.

    Except as otherwise expressly provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of title 17, United States 
Code.

SEC. 3. COPYRIGHT ROYALTY JUDGE AND STAFF.

    (a) In General.--Chapter 8 is amended to read as follows:

           CHAPTER 8--PROCEEDINGS BY COPYRIGHT ROYALTY JUDGE

``Sec.
``801. Copyright Royalty Judge; appointment and functions.
``802. Copyright Royalty Judgeship; professional staff.
``803. Proceedings of Copyright Royalty Judges.
``804. Institution and conclusion of proceedings.
``Sec. 801. Copyright Royalty Judge; appointment and functions
    ``(a) Appointment.--The Librarian of Congress shall appoint a full-
time Copyright Royalty Judge. In making the appointment, the Librarian 
may consult with the Register of Copyrights.
    ``(b) Functions.--Subject to the provisions of this chapter, the 
functions of the Copyright Royalty Judge shall be as follows:
            ``(1) To make determinations concerning the adjustment of 
        reasonable copyright royalty rates as provided in sections 111, 
        114, 115, 119, and 1004.
            ``(2) To make determinations as to reasonable terms and 
        rates of royalty payments as provided in sections 112(e), 114, 
        115, 116, and 118. The rates applicable under sections 
        114(f)(1)(B), 115, and 116 shall be calculated to achieve the 
        following objectives:
                    ``(A) To maximize the availability of creative 
                works to the public.
                    ``(B) To afford the copyright owner a fair return 
                for his or her creative work and the copyright user a 
                fair income under existing economic conditions.
                    ``(C) To reflect the relative roles of the 
                copyright owner and the copyright user in the product 
                made available to the public with respect to relative 
                creative contribution, technological contribution, 
                capital investment, cost, risk, and contribution to the 
                opening of new markets for creative expression and 
                media for their communication.
                    ``(D) To minimize any disruptive impact on the 
                structure of the industries involved and on generally 
                prevailing industry practices.
            ``(3) To make determinations concerning the adjustment of 
        the copyright royalty rates under section 111 solely in 
        accordance with the following provisions:
                    ``(A) The rates established by section 111(d)(1)(B) 
                may be adjusted to reflect--
                            ``(i) national monetary inflation or 
                        deflation; or
                            ``(ii) changes in the average rates charged 
                        cable subscribers for the basic service of 
                        providing secondary transmissions to maintain 
                        the real constant dollar level of the royalty 
                        fee per subscriber which existed as of the date 
                        of October 19, 1976,
                except that--
                            ``(I) if the average rates charged cable 
                        system subscribers for the basic service of 
                        providing secondary transmissions are changed 
                        so that the average rates exceed national 
                        monetary inflation, no change in the rates 
                        established by section 111(d)(1)(B) shall be 
                        permitted; and
                            ``(II) no increase in the royalty fee shall 
                        be permitted based on any reduction in the 
                        average number of distant signal equivalents 
                        per subscriber.
                The Copyright Royalty Judge may consider all factors 
                relating to the maintenance of such level of payments, 
                including, as an extenuating factor, whether the 
                industry has been restrained by subscriber rate 
                regulating authorities from increasing the rates for 
                the basic service of providing secondary transmissions.
                    ``(B) In the event that the rules and regulations 
                of the Federal Communications Commission are amended at 
                any time after April 8, 1976, to permit the carriage by 
                cable systems of additional television broadcast 
                signals beyond the local service area of the primary 
                transmitters of such signals, the royalty rates 
                established by section 111(d)(1)(B) may be adjusted to 
                insure that the rates for the additional distant signal 
                equivalents resulting from such carriage are reasonable 
                in the light of the changes effected by the amendment 
                to such rules and regulations. In determining the 
reasonableness of rates proposed following an amendment of Federal 
Communications Commission rules and regulations, the Copyright Royalty 
Judge shall consider, among other factors, the economic impact on 
copyright owners and users; except that no adjustment in royalty rates 
shall be made under this subparagraph with respect to any distant 
signal equivalent or fraction thereof represented by--
                            ``(i) carriage of any signal permitted 
                        under the rules and regulations of the Federal 
                        Communications Commission in effect on April 
                        15, 1976, or the carriage of a signal of the 
                        same type (that is, independent, network, or 
                        noncommercial educational) substituted for such 
                        permitted signal; or
                            ``(ii) a television broadcast signal first 
                        carried after April 15, 1976, pursuant to an 
                        individual waiver of the rules and regulations 
                        of the Federal Communications Commission, as 
                        such rules and regulations were in effect on 
                        April 15, 1976.
                    ``(C) In the event of any change in the rules and 
                regulations of the Federal Communications Commission 
                with respect to syndicated and sports program 
                exclusivity after April 15, 1976, the rates established 
                by section 111(d)(1)(B) may be adjusted to assure that 
                such rates are reasonable in light of the changes to 
                such rules and regulations, but any such adjustment 
                shall apply only to the affected television broadcast 
                signals carried on those systems affected by the 
                change.
                    ``(D) The gross receipts limitations established by 
                section 111(d)(1)(C) and (D) shall be adjusted to 
                reflect national monetary inflation or deflation or 
                changes in the average rates charged cable system 
                subscribers for the basic service of providing 
                secondary transmissions to maintain the real constant 
                dollar value of the exemption provided by such section, 
                and the royalty rate specified therein shall not be 
                subject to adjustment.
            ``(4) To authorize the distribution of those royalty fees 
        collected under sections 111, 119, and 1005 that the judge has 
        found are not subject to controversy.
            ``(5) To authorize the distribution of royalty fees 
        deposited with the Register of Copyrights under sections 111, 
        116, 119(b), and 1003, and to determine, in cases where 
        controversy exists, the distribution of such fees.
            ``(6) To accept or reject royalty claims filed under 
        section 111, 119, and 1007, on the basis of timeliness or the 
        failure to establish the basis for a claim.
            ``(7) To determine the status of a digital audio recording 
        device or a digital audio interface device under sections 1002 
        and 1003, as provided in section 1010.
    ``(c) Rulings.--The Copyright Royalty Judge may make any necessary 
procedural or evidentiary rulings in any proceeding under this chapter 
and may, before commencing a proceeding under this chapter, make any 
such rulings that would apply to the proceedings conducted by the 
Copyright Royalty Judge. The Copyright Royalty Judge may consult with 
the Register of Copyrights in making any rulings under this subsection.
    ``(d) Administrative Support.--The Librarian of Congress shall 
provide the Copyright Royalty Judge with the necessary administrative 
services related to proceedings under this chapter.
``Sec. 802. Copyright Royalty Judgeship; professional staff
    ``(a) Qualifications of Copyright Royalty Judge.--The Copyright 
Royalty Judge shall be an attorney with 10 or more years of legal 
practice with demonstrated experience in administrative hearings or 
court trials and demonstrated knowledge of copyright law who is free of 
any financial conflict of interest under subsection (h).
    ``(b) Professional Staff.--The Copyright Royalty Judge shall 
appoint 2 full-time staff members to assist the Copyright Royalty Judge 
in performing the functions of the Copyright Royalty Judge. Each staff 
member shall be an individual with expertise in copyright law and in 
the business and economics of industries affected by the actions taken 
by the Copyright Royalty Judge under this chapter.
    ``(c) Terms.--The term of the Copyright Royalty Judge shall be 5 
years. An individual serving as a Copyright Royalty Judge may be 
reappointed to subsequent terms as such judge. The term of the 
Copyright Royalty Judge shall begin when the term of the predecessor of 
that Judge ends. When the term of office of a Copyright Royalty Judge 
ends, the individual serving that term may continue to serve until a 
successor is selected.
    ``(d) Vacancies.--If a vacancy should occur in the position of 
Copyright Royalty Judge, the Librarian of Congress shall act 
expeditiously to fill the vacancy, and may appoint an interim Copyright 
Royalty Judge to serve until another Copyright Royalty Judge is 
appointed under this section. An individual appointed to fill the 
vacancy occurring before the expiration of the term for which the 
predecessor of that individual was appointed shall be appointed for the 
remainder of that term.
    ``(e) Compensation.--The Copyright Royalty Judge shall receive 
compensation at the rate of basic pay payable for level AL-2 for 
administrative law judges pursuant to section 5372(b) of title 5, and 
the staff members appointed under subsection (b) shall each be paid at 
a rate of pay determined by the Librarian of Congress which shall be 
not less than the basic rate of pay payable for GS-14 of the General 
Schedule and not more than the basic rate of pay payable for GS-15 of 
such Schedule. The compensation of the Copyright Royalty Judge and such 
staff members shall not be subject to any regulations adopted by the 
Office of Personnel Management pursuant to its authority under section 
5376(b)(1) of title 5.
    ``(f) Independence of Copyright Royalty Judge.--
            ``(1) In general.--The Copyright Royalty Judge shall have 
        full independence in making determinations concerning 
        adjustments and determinations of copyright royalty rates and 
        terms, the distribution of copyright royalties, the acceptance 
        or rejection of royalty claims and rate adjustment petitions, 
        and in issuing rulings under this title, except that the 
        Copyright Royalty Judge may consult with the Register of 
        Copyrights in making such determinations.
            ``(2) Performance appraisals.--
                    ``(A) In general.--Notwithstanding any other 
                provision of law or any regulation of the Library of 
                Congress, the Copyright Royalty Judge shall not receive 
                an annual performance appraisal.
                    ``(B) Relating to sanction or removal.--To the 
                extent that the Librarian of Congress adopts 
                regulations under subsection (h) relating to the 
                sanction or removal of a Copyright Royalty Judge and 
                such regulations require documentation to establish the 
                cause of such sanction or removal, the Copyright 
                Royalty Judge may receive an appraisal related 
                specifically to the cause of the sanction or removal.
    ``(g) Inconsistent Duties Barred.--The Copyright Royalty Judge may 
not undertake duties inconsistent with his or her duties and 
responsibilities as Copyright Royalty Judge.
    ``(h) Standards of Conduct.--The Librarian of Congress shall adopt 
regulations regarding the standards of conduct, including financial 
conflict of interest and restrictions against ex parte communications, 
which shall govern the Copyright Royalty Judge and the proceedings 
under this chapter.
    ``(i) Removal or Sanction.--The Librarian of Congress may sanction 
or remove a Copyright Royalty Judge for violation of the standards of 
conduct adopted under subsection (h), misconduct, neglect of duty, or 
any disqualifying physical or mental disability. Any such sanction or 
removal may be made only after notice and opportunity for a hearing, 
but the Librarian of Congress may suspend the Copyright Royalty Judge 
during the pendency of such hearing. The Librarian shall appoint an 
interim Copyright Royalty Judge during the period of any such 
suspension.
``Sec. 803. Proceedings of Copyright Royalty Judges
    ``(a) Proceedings.--The Copyright Royalty Judge shall conduct 
proceedings in accordance with subchapter II of chapter 5 of title 5, 
for the purpose of making determinations in carrying out the purposes 
set forth in section 801. The Copyright Royalty Judge shall act on the 
basis of a fully documented written record, prior decisions of the 
Copyright Royalty Tribunal, prior copyright arbitration panel 
determinations, and rulings by the Librarian of Congress before the 
effective date of the Copyright Royalty and Distribution Reform Act of 
2003. Any person participating in proceedings under this chapter may 
submit relevant information and proposals to the Copyright Royalty 
Judge in such proceedings.
    ``(b) Procedures.--
            ``(1) Participation in general.--Subject to paragraph (2), 
        a person may participate in proceedings under this chapter, 
        including through the submission of briefs or other 
        information, only if that person files with the Copyright 
        Royalty Judge, in such form and manner as the Librarian of 
        Congress may by regulation prescribe, a notice of intent to 
        participate in the proceedings, together with a filing fee of 
        $150, before the proceedings commence.
            ``(2) Small claims proceedings.--If the amount in 
        controversy that a party to a proceeding under this chapter to 
        determine the distribution of royalties asserts is $500 or 
        less, that party may elect to have the controversy decided by 
        the Copyright Royalty Judge on the basis of the filing in 
        writing of the initial claim, initial response by any opposing 
        party, and one additional response by each of such party. The 
        party making such election shall not be required to pay the 
        filing fee under paragraph (1).
            ``(3) Regulations.--
                    ``(A) In general.--The Register of Copyrights 
                shall, not later than 60 days after the date of the 
                enactment of the Copyright Royalty and Distribution 
                Reform Act of 2003, issue regulations to govern 
                proceedings under this chapter, subject to section 
                801(c).
                    ``(B) Interim regulations.--Until such regulations 
                are adopted, the regulations in effect under this 
                chapter on the day before such date of enactment shall 
                continue to apply, except that functions carried out 
                under such regulations by the Librarian of Congress, 
                the Register of Copyrights, or copyright arbitration 
                royalty panels that, as of such date of enactment, are 
                to be carried out by the Copyright Royalty Judge under 
                this chapter, shall be carried out by the Copyright 
                Royalty Judge under such regulations.
                    ``(C) Requirements.--Regulations issued under 
                subparagraph (A) shall include the following:
                            ``(i) The Federal Rules of Evidence with 
                        respect to hearsay shall apply to proceedings 
                        under this chapter.
                            ``(ii) Discovery in such proceedings shall 
                        be permitted for a period of 60 days. Final 
                        witness lists for the proceedings shall not be 
                        required until the end of the discovery period.
                            ``(iii) A defending party to a claim in a 
                        proceeding may serve upon an adverse party an 
                        offer to allow for a determination to be made 
                        against the adverse party for the claimed money 
                        or property or other specified amount up to the 
                        day on which hearings in the proceeding begin. 
                        If before the day on which hearings in the 
                        proceeding begin an offer under this clause is 
                        accepted, either party may file the offer and 
                        notice of acceptance of the offer with the 
                        Copyright Royalty Judge, who shall enter his or 
                        her determination pursuant thereto.
    ``(c) Decision of Copyright Royalty Judge.--Not later than 6 months 
after the date of publication of the notice in the Federal Register 
initiating a proceeding under this chapter, the Copyright Royalty Judge 
shall issue his or her determination in the proceeding, except that the 
Copyright Royalty Judge may extend that 6-month period to 1 year for 
that proceeding if the Copyright Royalty Judge determines such 
extension to be necessary. The Copyright Royalty Judge's determination 
shall be accompanied by the written record, and shall set forth the 
facts that the Copyright Royalty Judge found relevant to his or her 
determination. The Librarian of Congress shall cause such determination 
to be published in the Federal Register. The Librarian shall also 
publicize the determination in such other manner as the Librarian 
considers appropriate, including, but not limited to, publication on 
the official website of the Copyright Office. The Librarian shall also 
make the determination and the accompanying record available for public 
inspection and copying.
    ``(d) Judicial Review.--Any determination of the Copyright Royalty 
Judge under subsection (c) may, within 30 days after the publication of 
the determination in the Federal Register, be appealed, by any 
aggrieved party who would be bound by the determination, to the United 
States Court of Appeals for the District of Columbia Circuit. If no 
appeal is brought within that 30-day period, the determination of the 
Copyright Royalty Judge is final, and the royalty fee or determination 
with respect to the distribution of fees, as the case may be, shall 
take effect as set forth in the determination of the Copyright Royalty 
Judge. When this title provides that the royalty rates or terms that 
were previously in effect are to expire on a specified date, any 
adjustment by the Copyright Royalty Judge of those rates or terms shall 
be effective as of the day following the date of expiration of the 
rates or terms that were previously in effect, even if the Copyright 
Royalty Judge's determination is rendered on a later date. The pendency 
of an appeal under this paragraph shall not relieve persons obligated 
to make royalty payments under section 111, 112, 114, 115, 116, 118, 
119, or 1003 who would be affected by the determination on appeal to 
deposit the statement of account and royalty fees specified in those 
sections. The court shall have jurisdiction to modify or vacate a 
determination of the Copyright Royalty Judge only if it finds, on the 
basis of the record before the Copyright Royalty Judge, that the 
Copyright Royalty Judge acted in an arbitrary or capricious manner. If 
the court modifies the determination of the Copyright Royalty Judge, 
the court shall have jurisdiction to enter its own determination with 
respect to the amount or distribution of royalty fees and costs, to 
order the repayment of any excess fees, and to order the payment of any 
underpaid fees, and the interest pertaining respectively thereto, in 
accordance with its final judgment. The court may further vacate the 
determination of the Copyright Royalty Judge and remand the case to the 
Copyright Royalty Judge for proceedings in accordance with subsection 
(a).
    ``(e) Administrative Matters.--
            ``(1) Deduction of costs of library of congress and 
        copyright office from royalty fees.--
                    ``(A) Deduction from filing fees and royalty 
                fees.--The Librarian of Congress may, to the extent not 
                otherwise provided under this title, deduct from the 
                filing fees collected under subsection (b) for a 
                particular proceeding under this chapter the reasonable 
                costs incurred by the Library of Congress, the 
                Copyright Office, and the Copyright Royalty Judge in 
                conducting that proceeding, other than the salaries of 
                the Copyright Royalty Judge and the two professional 
                staff members appointed under section 802(b). To the 
                extent that such costs exceed the amount of such filing 
                fees, the Librarian of Congress may, after making the 
                deduction from such filing fees, deduct the balance of 
                such costs from not more than 1 percent of the royalty 
                fees deposited or collected under this title that 
                relate to that proceeding. Such deduction may be made 
                before the fees are distributed to any copyright 
                claimants.
                    ``(B) Remaining costs.--Any costs described in 
                subparagraph (A) that remain after the deductions under 
                subparagraph (A)--
                            ``(i) in ratemaking proceedings, shall be 
                        borne by the parties to the proceedings in 
                        equal proportions; and
                            ``(ii) in distribution proceedings, shall 
                        be borne by the parties to the proceedings in 
                        equal proportions.
                    ``(C) Appropriations.--All funds made available by 
                an appropriations Act as offsetting collections and 
                available for deductions under this subsection shall 
                remain available until expended.
            ``(2) Positions required for administration of compulsory 
        licensing.--Section 307 of the Legislative Branch 
        Appropriations Act, 1994, shall not apply to employee positions 
        in the Library of Congress that are required to be filled in 
        order to carry out section 111, 112, 114, 115, 116, 118, or 119 
        or chapter 10.
``Sec. 804. Institution and conclusion of proceedings
    ``(a) Filing of Petition.--With respect to proceedings under 
paragraphs (1) and (2) of section 801(b) concerning the determination 
or adjustment of royalty rates as provided in sections 111, 112, 114, 
115, 116, 118, and 1004, during the calendar years specified in the 
schedule set forth in subsection (b), any owner or user of a 
copyrighted work whose royalty rates are specified by this title, or 
are established under this chapter before or after the enactment of the 
Copyright Royalty and Distribution Reform Act of 2003, may file a 
petition with the Copyright Royalty Judge declaring that the petitioner 
requests a determination or adjustment of the rate. The Copyright 
Royalty Judge shall make a determination as to whether the petitioner 
has such a significant interest in the royalty rate in which a 
determination or adjustment is requested. If the Copyright Royalty 
Judge determines that the petitioner has such a significant interest, 
the Copyright Royalty Judge shall cause notice of this determination, 
with the reasons therefor, to be published in the Federal Register, 
together with the notice of commencement of proceedings under this 
chapter.
    ``(b) Timing of Petitions.--
            ``(1) Section 111 proceedings.--(A) In proceedings under 
        section 801(b)(1) concerning the adjustment of royalty rates 
        under section 111 to which subparagraph (A) or (D) of section 
        801(b)(3) applies, a petition described in subsection (a) may 
        be filed during the year 2005 and in each subsequent fifth 
        calendar year.
            ``(B) In proceedings under section 801(b)(1) concerning the 
        adjustment of royalty rates under section 111 to which 
        subparagraph (B) or (C) of section 801(b)(3) applies, within 12 
        months after an event described in either of those subsections, 
        any owner or user of a copyrighted work whose royalty rates are 
        specified by section 111, or by a rate established under this 
        chapter before or after the enactment of the Copyright Royalty 
        and Distribution Reform Act of 2003, may file a petition with 
        the Copyright Royalty Judge declaring that the petitioner 
        requests an adjustment of the rate. The Copyright Royalty Judge 
        shall then proceed as set forth in subsection (a) of this 
        section. Any change in royalty rates made under this chapter 
        pursuant to this subparagraph may be reconsidered in the year 
        2005, and each fifth calendar year thereafter, in accordance 
        with the provisions in section 801(b)(3)(B) or (C), as the case 
        may be.
            ``(2) Section 115 proceedings.--In proceedings under 
        section 801(b)(1) or (2) concerning the adjustment or 
        determination of royalty rates as provided in section 115, a 
        petition described in paragraph (1) may be filed in the year 
        2007 and in each subsequent fifth calendar year or as 
        prescribed in section 115(c)(3)(B), (C), or (D).
            ``(3) Section 116 proceedings.--(A) In proceedings under 
        section 801(b)(2) concerning the determination of royalty rates 
        and terms as provided in section 116, a petition described in 
        paragraph (1) may be filed at any time within 1 year after 
        negotiated licenses authorized by section 116 are terminated or 
        expire and are not replaced by subsequent agreements.
            ``(B) If a negotiated license authorized by section 116 is 
        terminated or expires and is not replaced by another such 
        license agreement which provides permission to use a quantity 
        of musical works not substantially smaller than the quantity of 
        such works performed on coin-operated phonorecord players 
        during the 1-year period ending March 1, 1989, the Copyright 
        Royalty Judge shall, upon petition filed under paragraph (1) 
        within 1 year after such termination or expiration, commence a 
        proceeding to promptly establish an interim royalty rate or 
        rates for the public performance by means of a coin-operated 
        phonorecord player of nondramatic musical works embodied in 
        phonorecords which had been subject to the terminated or 
        expired negotiated license agreement. Such rate or rates shall 
        be the same as the last such rate or rates and shall remain in 
        force until the conclusion of proceedings by the Copyright 
        Royalty Judge, in accordance with section 803, to adjust the 
        royalty rates applicable to such works, or until superseded by 
        a new negotiated license agreement, as provided in section 
        116(b).
            ``(4) Section 112 and 114.--With respect to proceedings 
        under section 801(b)(2) concerning the determination of 
        reasonable terms and rates of royalty payments as provided in 
        section 112 or 114, the Librarian of Congress and the Copyright 
        Royalty Judge shall proceed when and as provided by those 
        sections.
            ``(5) Section 118 proceedings.--With respect to proceedings 
        under section 801(b)(2) concerning the determination of 
        reasonable terms and rates of royalty payments as provided in 
        section 118, the Librarian of Congress and the Copyright 
        Royalty Judge shall proceed when and as provided by that 
        section.
            ``(6) Proceedings concerning distribution of royalty 
        fees.--With respect to proceedings under section 801(b)(5) 
        concerning the distribution of royalty fees in certain 
        circumstances under section 111, 116, 119, or 1007, the 
        Copyright Royalty Judge shall, upon a determination that a 
        controversy exists concerning such distribution, cause to be 
        published in the Federal Register notice of commencement of 
        proceedings under this chapter.''.
    (b) Conforming Amendment.--The table of chapters for title 17, 
United States Code, is amended by striking the item relating to chapter 
8 and inserting the following:

``8. PROCEEDINGS OF COPYRIGHT ROYALTY JUDGE.................     801''.

SEC. 4. DEFINITION.

    Section 101 is amended by inserting after the definition of 
``copies'' the following:
            ``The `Copyright Royalty Judge' is the Copyright Royalty 
        Judge appointed under section 802 of this title, and includes 
        any individual serving as an interim Copyright Royalty Judge 
        under such section.''.

SEC. 5. TECHNICAL AMENDMENTS.

    (a) Cable Rates.--Section 111(d)(4) is amended--
            (1) in subparagraph (B)--
                    (A) by striking ``Librarian of Congress shall, upon 
                the recommendation of the Register of Copyrights,'' and 
                inserting ``Copyright Royalty Judge shall'';
                    (B) by striking ``Librarian'' each subsequent place 
                it appears and inserting ``Copyright Royalty Judge''; 
                and
                    (C) by striking ``convene a copyright arbitration 
                royalty panel'' and inserting ``conduct a proceeding''; 
                and
            (2) in subparagraph (C), by striking ``Librarian of 
        Congress'' and inserting ``Copyright Royalty Judge''.
    (b) Ephemeral Recordings.--Section 112(e) is amended--
            (1) in paragraph (3), by amending the first sentence to 
        read as follows: ``During the first week of January 2007, the 
        Librarian of Congress shall cause notice to be published in the 
        Federal Register of the initiation of voluntary negotiation 
        proceedings for the purpose of determining reasonable terms and 
        rates of royalty payments for the activities specified by 
        paragraph (1) during the period beginning on January 1, 2007, 
and ending on December 31, 2011, or such other date as the parties may 
agree.'';
            (2) in paragraph (4)--
                    (A) by amending the first sentence to read as 
                follows: ``In the absence of license agreements 
                negotiated under paragraph (2), during the 60-day 
                period beginning on the date that is 6 months after 
                publication of the notice specified in paragraph (3), 
                and upon the filing of a petition in accordance with 
                section 804(a), the Copyright Royalty Judge shall 
                commence a proceeding pursuant to chapter 8 to 
                determine and publish in the Federal Register a 
                schedule of reasonable rates and terms which, subject 
                to paragraph (5), shall be binding on all copyright 
                owners of sound recordings and transmitting 
                organizations entitled to a statutory license under 
                this subsection during the 5-year period specified in 
                paragraph (3), or such other date as the parties may 
                agree.'';
                    (B) by striking ``copyright arbitration royalty 
                panel'' each subsequent place it appears and inserting 
                ``Copyright Royalty Judge''; and
                    (C) in the fourth sentence, by striking ``its 
                decision'' and inserting ``his or her decision'';
            (3) in paragraph (5), by striking ``or decision by the 
        Librarian of Congress'' and inserting ``, decision by Librarian 
        of Congress, or determination by the Copyright Royalty Judge''; 
        and
            (4) in paragraph (6)--
                    (A) in the first sentence, by striking ``January 
                2000, and at 2-year'' and inserting ``January 2012, and 
                at 5-year'';
                    (B) in the second sentence--
                            (i) by striking ``803(a)(1)'' and inserting 
                        ``804(a)''; and
                            (ii) by striking ``July 1, 2000, and at 2-
                        year'' and inserting ``July 1, 2012, and at 5-
                        year''; and
                    (C) in the last sentence, by striking ``802'' and 
                inserting ``803''.
    (c) Scope of Exclusive Rights in Sound Recordings.--Section 114(f) 
is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by amending the first 
                sentence to read as follows: ``During the first week of 
                January 2006, the Librarian of Congress shall cause 
                notice to be published in the Federal Register of the 
                initiation of voluntary negotiation proceedings for the 
                purpose of determining reasonable terms and rates of 
                royalty payments for subscription transmissions by 
                preexisting subscription services and transmissions by 
                preexisting satellite digital audio radio services 
                specified by subsection (d)(2) during the period 
                beginning on January 1, 2006, and ending on December 
                31, 2010, or such other date as the parties may 
                agree.'';
                    (B) in subparagraph (B)--
                            (i) by amending the first sentence to read 
                        as follows: ``In the absence of license 
                        agreements negotiated under subparagraph (A), 
                        during the 60-day period beginning on the date 
                        that is 6 months after publication of the 
                        notice specified in subparagraph (A), and upon 
                        the filing of a petition in accordance with 
                        section 804(a), the Copyright Royalty Judge 
                        shall commence proceedings pursuant to chapter 
                        8 to determine and publish in the Federal 
                        Register a schedule of rates and terms which, 
                        subject to paragraph (3), shall be binding on 
                        all copyright owners of sound recordings and 
                        entities performing sound recordings affected 
                        by this paragraph.''; and
                            (ii) by striking ``copyright arbitration 
                        royalty panel'' and inserting ``Copyright 
                        Royalty Judge''; and
                    (C) in subparagraph (C)--
                            (i) in clause (i)(II), by striking ``2001'' 
                        and inserting ``2011'';
                            (ii) in clause (ii)--
                                    (I) by striking ``803(a)(1)'' and 
                                inserting ``804(a)''; and
                                    (II) in subclause (II), by striking 
                                ``2001'' and inserting ``2011''; and
                            (iii) in clause (iii), by striking ``802'' 
                        and inserting ``803'';
            (2) in paragraph (2)--
                    (A) in subparagraph (A), by amending the first 
                sentence to read as follows: ``During the first week of 
                January 2007, the Librarian of Congress shall cause 
                notice to be published in the Federal Register of the 
                initiation of voluntary negotiation proceedings for the 
                purpose of determining reasonable terms and rates of 
                royalty payments for public performances of sound 
                recordings by means of eligible nonsubscription 
                transmissions and transmissions by new subscription 
                services specified by subsection (d)(2) during the 
                period beginning on January 1, 2007, and ending on 
                December 31, 2011, or such other date as the parties 
                may agree.'';
                    (B) in subparagraph (B)--
                            (i) by amending the first sentence to read 
                        as follows: ``In the absence of license 
                        agreements negotiated under subparagraph (A), 
                        during the 60-day period beginning on the date 
                        that is 6 months after publication of the 
                        notice specified in subparagraph (A), and upon 
                        the filing of a petition in accordance with 
                        section 804(a), the Copyright Royalty Judge 
                        shall commence proceedings pursuant to chapter 
                        8 to determine and publish in the Federal 
                        Register a schedule of rates and terms which, 
                        subject to paragraph (3), shall be binding on 
                        all copyright owners of sound recordings and 
                        entities performing sound recordings affected 
                        by this paragraph during the period beginning 
                        on January 1, 2007, and ending on December 31, 
                        2011, or such other date as the parties may 
                        agree.''; and
                            (ii) by striking ``copyright arbitration 
                        royalty panel'' each subsequent place it 
                        appears and inserting ``Copyright Royalty 
                        Judge'';
                    (C) in subparagraph (C)--
                            (i) in clause (i)(II), by striking 
                        ``January 2000, and at 2-year'' and inserting 
                        ``January 2012, and at 5-year'';
                            (ii) in clause (ii)--
                                    (I) by striking ``803(a)(1)'' and 
                                inserting ``804(a)''; and
                                    (II) in subclause (II), by striking 
                                ``July 1, 2000, and at 2-year'' and 
                                inserting ``July 1, 2012, and at 5-
                                year''; and
                            (iii) in clause (iii), by striking ``802'' 
                        and inserting ``803''; and
            (3) in paragraph (3), by striking ``or decision by the 
        Librarian of Congress'' and inserting ``, decision by the 
        Librarian of Congress, or determination by the Copyright 
        Royalty Judge''.
    (d) Phonorecords of Nondramatic Musical Works.--Section 115(c)(3) 
is amended--
            (1) in subparagraph (C), by amending the first sentence to 
        read as follows: ``During the period of June 30, 2006, through 
December 31, 2006, the Librarian of Congress shall cause notice to be 
published in the Federal Register of the initiation of voluntary 
negotiation proceedings for the purpose of determining reasonable terms 
and rates of royalty payments for the activities specified by 
subparagraph (A) during the period beginning January 1, 2008, and 
ending on the effective date of any new terms and rates established 
pursuant to this subparagraph or subparagraph (D) or (F), or such other 
date (regarding digital phonorecord deliveries) as the parties may 
agree.'';
            (2) in subparagraph (D)--
                    (A) by amending the first sentence to read as 
                follows: ``In the absence of license agreements 
                negotiated under subparagraphs (B) and (C), upon the 
                filing of a petition in accordance with section 804(a), 
                the Copyright Royalty Judge shall commence proceedings 
                pursuant to chapter 8 to determine and publish in the 
                Federal Register a schedule or rates and terms which, 
                subject to subparagraph (E), shall be binding on all 
                copyright owners of nondramatic musical works and 
                persons entitled to obtain a compulsory license under 
                subsection (a)(1) during the period beginning January 
                1, 2008, and ending on the effective date of any new 
                terms and rates established pursuant to subparagraph 
                (C) or (F) or this subparagraph, or such other date 
                (regarding digital phonorecord deliveries) as may be 
                determined pursuant to subparagraphs (B) and (C).''; 
                and
                    (B) in the second sentence, by striking ``copyright 
                arbitration royalty panel'' and inserting ``Copyright 
                Royalty Judge'';
            (3) in subparagraph (E)(i), in the first sentence, by 
        striking ``the Librarian of Congress'' and inserting ``a 
        copyright arbitration royalty panel, the Librarian of Congress, 
        or the Copyright Royalty Judge''; and
            (4) in subparagraph (F), by striking ``1997'' and inserting 
        ``2007''.
    (e) Coin-Operated Phonorecord Players.--Section 116 is amended--
            (1) in subsection (b), by amending paragraph (2) to read as 
        follows:
            ``(2) Chapter 8 proceeding.--Parties not subject to such a 
        negotiation may have the terms and rates and the division of 
        fees described in paragraph (1) determined in a proceeding in 
        accordance with the provisions of chapter 8.''; and
            (2) in subsection (c)--
                    (A) in the subsection heading, by striking 
                ``Copyright Arbitration Royalty Panel Determinations'' 
                and inserting ``Determinations by Copyright Royalty 
                Judge''; and
                    (B) by striking ``a copyright arbitration royalty 
                panel'' and inserting ``the Copyright Royalty Judge''.
    (f) Use of Certain Works in Connection With Noncommercial 
Broadcasting.--Section 118 is amended--
            (1) in subsection (b)--
                    (A) in paragraph (1), by striking the second and 
                third sentences;
                    (B) in paragraph (2), by striking ``the Librarian 
                of Congress: Provided, That'' and inserting ``a 
                copyright arbitration royalty panel, the Librarian of 
                Congress, or the Copyright Royalty Judge, if''; and
                    (C) in paragraph (3)--
                            (i) by amending the first sentence to read 
                        as follows: ``In the absence of license 
                        agreements negotiated under paragraph (2), the 
                        Copyright Royalty Judge shall, pursuant to 
                        chapter 8, conduct a proceeding to determine 
                        and publish in the Federal Register a schedule 
                        of rates and terms which, subject to paragraph 
                        (2), shall be binding on all owners of 
                        copyright in works specified by this subsection 
                        and public broadcasting entities, regardless of 
                        whether such copyright owners have submitted 
                        proposals to the Librarian of Congress.''; and
                            (ii) in the second sentence, by striking 
                        ``copyright arbitration royalty panel'' and 
                        inserting ``Copyright Royalty Judge'';
            (2) in subsection (c), by striking ``1997'' and inserting 
        ``2007''; and
            (3) in subsection (d), by striking ``a copyright 
        arbitration royalty panel'' and inserting ``the Copyright 
        Royalty Judge''.
    (g) Secondary Transmissions by Satellite Carriers.--Section 
119(b)(4) is amended--
            (1) in subparagraph (A), by striking ``Librarian of 
        Congress'' the first place it appears and inserting ``Copyright 
        Royalty Judge''; and
            (2) by amending subparagraphs (B) and (C) to read as 
        follows:
                    ``(B) Determination of controversy; 
                distributions.--After the first day of August of each 
                year, the Copyright Royalty Judge shall determine 
                whether there exists a controversy concerning the 
                distribution of royalty fees. If the Copyright Royalty 
                Judge determines that no such controversy exists, the 
                Copyright Royalty Judge shall, after deducting 
                reasonable administrative costs under this paragraph, 
                distribute such fees to the copyright owners entitled 
                to receive them, or to their designated agents. If the 
                Copyright Royalty Judge finds the existence of a 
                controversy, the Copyright Royalty Judge shall, 
                pursuant to chapter 8 of this title, conduct a 
                proceeding to determine the distribution of royalty 
                fees.
                    ``(C) Withholding of fees during controversy.--
                During the pendency of any proceeding under this 
                subsection, the Copyright Royalty Judge shall withhold 
                from distribution an amount sufficient to satisfy all 
                claims with respect to which a controversy exists, but 
                shall have discretion to proceed to distribute any 
amounts that are not in controversy.''.
    (h) Digital Audio Recording Devices.--
            (1) Royalty payments.--Section 1004(a)(3) is amended by 
        amending the third sentence to read as follows: ``Not more than 
        once each year, any interested copyright party may petition the 
        Copyright Royalty Judge to increase the royalty maximum and, if 
        more than 20 percent of the royalty payments are at the 
        relevant royalty maximum, the Copyright Royalty Judge shall 
        prospectively increase such royalty maximum with the goal of 
        having no more than 10 percent of such payments at the new 
        royalty maximum; however the amount of any such increase as a 
        percentage of the royalty maximum shall in no event exceed the 
        percentage increase in the Consumer Price Index during the 
        period under review.''.
            (2) Entitlement to royalty payments.--
    Section 1006(c) is amended by striking ``Librarian of Congress 
shall convene a copyright arbitration royalty panel which'' and 
inserting ``Copyright Royalty Judge''.
            (3) Procedures for distributing royalty payments.--Section 
        1007 is amended--
                    (A) in subsection (a), by amending paragraph (1) to 
                read as follows:
            ``(1) Filing of claims.--During the first 2 months of each 
        calendar year, every interested copyright party seeking to 
        receive royalty payments to which such party is entitled under 
        section 1006 shall file with the Copyright Royalty Judge a 
        claim for payments collected during the preceding year in such 
        form and manner as the Librarian of Congress shall prescribe by 
        regulation.''; and
                    (B) by amending subsections (b) and (c) to read as 
                follows:
    ``(b) Distribution of Payments in the Absence of a Dispute.--After 
the period established for the filing of claims under subsection (a), 
in each year, the Copyright Royalty Judge shall determine whether there 
exists a controversy concerning the distribution of royalty payments 
under section 1006(c). If the Copyright Royalty Judge determines that 
no such controversy exists, the copyright royalty judge shall, within 
30 days after such determination, authorize the distribution of the 
royalty payments as set forth in the agreements regarding the 
distribution of royalty payments entered into pursuant to subsection 
(a). The Librarian of Congress shall, before such royalty payments are 
distributed, deduct the reasonable administrative costs incurred by the 
Librarian and the Copyright Office under this section.
    ``(c) Resolution of Disputes.--If the Copyright Royalty Judge finds 
the existence of a controversy, the Copyright Royalty Judge shall, 
pursuant to chapter 8 of this title, conduct a proceeding to determine 
the distribution of royalty payments. During the pendency of such a 
proceeding, the Copyright Royalty Judge shall withhold from 
distribution an amount sufficient to satisfy all claims with respect to 
which a controversy exists, but shall, to the extent feasible, 
authorize the distribution of any amounts that are not in controversy. 
The Librarian of Congress shall, before such royalty payments are 
distributed, deduct the reasonable administrative costs incurred by the 
Librarian and the Copyright Office under this section.''.
            (4) Determination of certain disputes.--(A) Section 1010 is 
        amended to read as follows:
``Sec. 1010. Determination of certain disputes
    ``(a) Scope of Determination.--Before the date of first 
distribution in the United States of a digital audio recording device 
or a digital audio interface device, any party manufacturing, 
importing, or distributing such device, and any interested copyright 
party may mutually agree to petition the Copyright Royalty Judge to 
determine whether such device is subject to section 1002, or the basis 
on which royalty payments for such device are to be made under section 
1003.
    ``(b) Initiation of Proceedings.--The parties under subsection (a) 
shall file the petition with the Copyright Royalty Judge requesting the 
commencement of a proceeding. Within 2 weeks after receiving such a 
petition, the Librarian of Congress shall cause notice to be published 
in the Federal Register of the initiation of the proceeding.
    ``(c) Stay of Judicial Proceedings.--Any civil action brought under 
section 1009 against a party to a proceeding under this section shall, 
on application of one of the parties to the proceeding, be stayed until 
completion of the proceeding.
    ``(d) Proceeding.--The Copyright Royalty Judge shall conduct a 
proceeding with respect to the matter concerned, in accordance with 
such procedures as the Copyright Royalty Judge may adopt. The Copyright 
Royalty Judge shall act on the basis of a fully documented written 
record. Any party to the proceeding may submit relevant information and 
proposals to the Copyright Royalty Judge. The parties to the proceeding 
shall bear the entire cost thereof in such manner and proportion as the 
Copyright Royalty Judge shall direct.
    ``(e) Judicial Review.--Any determination of the Copyright Royalty 
Judge under subsection (d) may be appealed, by a party to the 
proceeding, in accordance with section 803(d) of this title. The 
pendency of an appeal under this subsection shall not stay the 
determination of the Copyright Royalty Judge. If the court modifies the 
determination of the Copyright Royalty Judge, the court shall have 
jurisdiction to enter its own decision in accordance with its final 
judgment. The court may further vacate the determination of the 
Copyright Royalty Judge and remand the case for proceedings as provided 
in this section.''.
            (B) The item relating to section 1010 in the table of 
        sections for chapter 10 is amended to read as follows:

``1010. Determination of certain disputes.''.

SEC. 6. TRANSITION PROVISIONS.

    (a) In General.--Subject to subsection (b), the amendments made by 
this Act shall not affect any proceedings commenced before the 
enactment of this Act under the provisions of title 17, United States 
Code, amended by this Act, and pending on such date of enactment. Such 
proceedings shall continue, determinations made in such proceedings, 
and appeals taken therefrom, as if this Act had not been enacted, and 
shall continue in effect until modified under title 17, United States 
Code, as amended by this Act.
    (b) Effective Periods for Certain Ratemaking Proceedings.--
Notwithstanding subsection (a), terms and rates determined under 
proceedings under section 114(f)(2) or 112(e) of title 17, United 
States Code, commenced in 2002 shall be effective for an additional 
period of 3 years, or until such later date as the parties may agree, 
in lieu of the 2-year period otherwise provided for under such 
sections.
                                 <all>