[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]


                 OVERSIGHT OF THE U.S. COPYRIGHT OFFICE

=======================================================================

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON COURTS, INTELLECTUAL 
                          PROPERTY, AND THE INTERNET

                                 OF THE

                       COMMITTEE ON THE JUDICIARY

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                     WEDNESDAY, SEPTEMBER 27, 2023

                               __________

                           Serial No. 118-47

                               __________

         Printed for the use of the Committee on the Judiciary
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]         

               Available via: http://judiciary.house.gov
               
                               __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
53-722                        WASHINGTON : 2023                    
          
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                       COMMITTEE ON THE JUDICIARY

                        JIM JORDAN, Ohio, Chair

DARRELL ISSA, California             JERROLD NADLER, New York, Ranking 
KEN BUCK, Colorado                       Member
MATT GAETZ, Florida                  ZOE LOFGREN, California
MIKE JOHNSON, Louisiana              SHEILA JACKSON LEE, Texas
ANDY BIGGS, Arizona                  STEVE COHEN, Tennessee
TOM McCLINTOCK, California           HENRY C. ``HANK'' JOHNSON, Jr., 
TOM TIFFANY, Wisconsin                   Georgia
THOMAS MASSIE, Kentucky              ADAM SCHIFF, California
CHIP ROY, Texas                      ERIC SWALWELL, California
DAN BISHOP, North Carolina           TED LIEU, California
VICTORIA SPARTZ, Indiana             PRAMILA JAYAPAL, Washington
SCOTT FITZGERALD, Wisconsin          J. LUIS CORREA, California
CLIFF BENTZ, Oregon                  MARY GAY SCANLON, Pennsylvania
BEN CLINE, Virginia                  JOE NEGUSE, Colorado
LANCE GOODEN, Texas                  LUCY McBATH, Georgia
JEFF VAN DREW, New Jersey            MADELEINE DEAN, Pennsylvania
TROY NEHLS, Texas                    VERONICA ESCOBAR, Texas
BARRY MOORE, Alabama                 DEBORAH ROSS, North Carolina
KEVIN KILEY, California              CORI BUSH, Missouri
HARRIET HAGEMAN, Wyoming             GLENN IVEY, Maryland
NATHANIEL MORAN, Texas               BECCA BALINT, Vermont
LAUREL LEE, Florida
WESLEY HUNT, Texas
RUSSELL FRY, South Carolina

                                 ------                                

           SUBCOMMITTEE ON COURTS, INTELLECTUAL PROPERTY, AND
                              THE INTERNET

                    DARRELL ISSA, California, Chair

THOMAS MASSIE, Kentucky              HENRY C. ``HANK'' JOHNSON, Jr., 
SCOTT FITZGERALD, Wisconsin              Georgia, Ranking Member
CLIFF BENTZ, Oregon                  TED LIEU, California
BEN CLINE, Virginia                  JOE NEGUSE, Colorado
LANCE GOODEN, Texas                  DEBORAH ROSS, North Carolina
KEVIN KILEY, California              ADAM SCHIFF, California
NATHANIEL MORAN, Texas               ZOE LOFGREN, California
LAUREL LEE, Florida                  MADELEINE DEAN, Pennsylvania
RUSSELL FRY, South Carolina          GLENN IVEY, Maryland

               CHRISTOPHER HIXON, Majority Staff Director
          AMY RUTKIN, Minority Staff Director & Chief of Staff
                            
                            
                            C O N T E N T S

                              ----------                              

                     Wednesday, September 27, 2023

                                                                   Page

                           OPENING STATEMENTS

The Honorable Darrell Issa, Chair of the Subcommittee on Courts, 
  Intellectual Property, and the Internet from the State of 
  California.....................................................     1
The Honorable Henry C. ``Hank'' Johnson, Ranking Member of the 
  Subcommittee on Courts, Intellectual Property, and the Internet 
  from the State of Georgia......................................     2
The Honorable Jerrold Nadler, Ranking Member of the Committee on 
  the Judiciary from the State of New York.......................     3

                                WITNESS

The Hon. Shira Perlmutter, Register of Copyrights & Director, 
  U.S. Copyright Office, Library of Congress
  Oral Testimony.................................................     5
  Prepared Testimony.............................................     8

          LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING

All materials submitted by the Subcommittee on Courts, 
  Intellectual Property, and the Internet, for the record are 
  listed below...................................................    42

                 QUESTIONS AND RESPONSES FOR THE RECORD

Questions to Register Shira Perlmutter, Register of Copyrights & 
  Director, U.S. Copyright Office, Library of Congress, submitted 
  by the Honorable Darrell Issa, Chair of the Subcommittee on 
  Courts, Intellectual Property, and the Internet from the State 
  of California, for the record
  Response from Register Shira Perlmutter, Register of Copyrights 
      & Director, U.S. Copyright Office, Library of Congress

 
                 OVERSIGHT OF THE U.S. COPYRIGHT OFFICE

                              ----------                              


                     Wednesday, September 27, 2023

                        House of Representatives

           Subcommittee on Courts, Intellectual Property, and

                              the Internet

                       Committee on the Judiciary

                             Washington, DC

    The Committee met, pursuant to notice, at 10:04 a.m., in 
Room 2141, Rayburn House Office Building, the Hon. Darrell Issa 
[Chair of the Subcommittee] presiding.
    Members present: Representatives Issa, Jordan, Fitzgerald, 
Cline, Kiley, Moran, Lee, Fry, Johnson of Georgia, Lieu, Ross, 
Schiff, Lofgren, Dean, and Ivey.
    Mr. Issa. [Presiding.] Good morning. The Subcommittee will 
come to order.
    Without objection, the Chair is authorized to declare a 
recess at any time.
    We want to welcome everyone here today, and particularly 
note that there are conferences going on, and that a number of 
members have been delayed, but will attend. So, please, it is 
not you; it is the busyness of this week that causes a little 
bit of a delay for some people being here.
    I will now recognize myself for the joy of an opening 
statement, which I will abbreviate.
    As we all know, the Copyright Office plays a critical role 
in our economy. Strong copyright protection, the incentives 
that our creators, our Constitutional creators, bestowed, if 
you will, not for the benefit of the creators, producers, or 
innovators, but for the benefit of our society. The 
Constitution itself confers a responsibility on Congress to 
promote the progress of science and useful arts by securing for 
limited times for authors and inventors the exclusive right to 
their respective writings and discoveries.
    We take that role seriously, and for more than 200 years, 
have continued to debate what promotes. Most laws and most 
things conferred in the Constitution are fairly static. They go 
back their original intent. When the intent is, in fact, a 
mandate to promote, we must from time to time review whether or 
not that promotion is fair and appropriate. Too much, in fact, 
we deny the public the opportunity to also share in those 
creations. Too little, and those creations do not happen.
    As the Copyright Office carries out a wide range of 
responsibilities, it, too, must change with the time. When the 
Copyright Office made the decision that, in fact, full AI-
produced had no right to a copyright, they did us all an 
appropriate favor, because, in fact, we know that pushing a 
button and letting that run for days, weeks, months, or years 
is not, in fact, continuous innovation.
    In fact, today, one of our discussions will be on the 
intersection of artificial intelligence and copyrights, because 
we do not want to limit AI from participating in the further 
promotion of intellectual property that is useful in not only 
copyright, but also in patent. We must make sure that this is, 
in fact, an incentive, and not simply a reward for the first to 
turn on a machine.
    We recently held hearings on music modernization, 
mechanical licensing, with the Copyright Office, and we look 
forward to the potential renewal in 2025.
    We also examined issues of the right to repair, including 
examining the Copyright Office's Section 1201--hotly debated, 
but necessary.
    At each turn, we have been reminded that the importance of 
the Copyright Office in all these areas cannot be overstated, 
which is why I am pleased that the Register of Copyrights 
accepted our invitation to appear at this hearing, so that we 
can go straight to the source and explore the issues she faces, 
in fact, whether there are appropriate intersections for us to 
join in legislative changes.
    I want to thank the Register, and I want to appreciate her 
time.
    So, with that, we will have an opening statement from Mr. 
Johnson, and then, go right to our witness.
    With that, I recognize the Ranking Member, Mr. Johnson of 
Georgia.
    Mr. Johnson of Georgia. Thank you, Mr. Chair, for hosting 
and holding this hearing.
    Thank you, Register Perlmutter, for your appearance today.
    What does it mean for human beings to create? In a very 
real way, this question is the subject of our hearing today. 
This is not just a philosophical or academic query; it has 
real-world implications for countless American families and 
American businesses, and as such, our answer to this question 
must be reflected in our laws.
    For well over 100 years, our Copyright Office has protected 
Americans' intellectual property, and by doing so, has 
protected American creativity and innovation. That is no easy 
task.
    As technology evolves, intellectual property evolves with 
it. Artists, entertainers, writers, musicians, coders, and 
creators adapt to a changing world, and unfortunately, so do 
those who seek to profit by stealing intellectual property or 
by undermining copyright protections that are a cornerstone of 
our free enterprise system and a driver of both art and 
commerce.
    This Committee has deep experience in examining new 
technologies and determining how our laws must change to 
acknowledge the role new methods of innovation play in the 
world. Internet connectivity changed the way writing and art is 
created and shared. So, in 1998, Congress passed the Digital 
Millennium Copyright Act to change the way we protect creators.
    When music streaming began, it disrupted our thriving music 
community of artists, songwriters, publishers, and record 
labels. Instead of letting it flounder, the Music Modernization 
Act created new ways to ensure that songwriters are paid for 
their work.
    For creators, for the Copyright Office, and for this 
Committee, the rise of artificial intelligence, or AI, might 
pose the greatest challenge yet. AI models, trained on 
copyrighted data, pose serious intellectual property questions 
regarding licensing and credit for final products.
    I'm glad the Copyright Office addressed the question of 
whether AI--or excuse me. I'm glad that the Copyright Office 
addressed the question of whether AI in their creations can 
claim copyright protections and found that artists can only 
seek copyright for their human contribution.
    We all, however, know that this is just the beginning. The 
European Union is considering finalizing legislation to 
regulate the use of AI, and it includes regulations governing 
so-called trustworthy or ethical AI. Other individual Nations 
have also begun to take steps to say how they want AI to impact 
their citizens' work, play--or how their citizens work, play, 
and create.
    The United States, the leader in AI development, stands 
alone in its silence thus far. We cannot afford to ignore the 
very real challenges AI presents, even as we enjoy its very 
real benefits. Missing the moment would set our Nation back and 
it would harm the artists who call America home.
    I'm proud to represent the State of Georgia, also known as 
the ``Hollywood of the South,'' where actors, screenwriters, 
directors, and others live their dream. Georgia is also home to 
a thriving music industry, where artists, songwriters, and 
record labels live, work, and play.
    Their work and the work of the ecosystem of creation that 
encircles television and filmmaking, as well as music, from the 
crew to the studios boosts the GDP in Georgia and keeps our 
State strong.
    I was glad to see the writers and the studios come to the 
table and find common ground on many issues, including AI. It 
is time for Congress to do the same.
    Just before his death, Robert Kennedy told a crowd that,

        You cannot measure a Nation just by its wealth. The Gross 
        National Product, measures neither our wit nor our courage; 
        neither our wisdom . . . nor our devotion to our country; it 
        measures everything, in short, except that which makes life 
        worthwhile.

    The Copyright Office protects many intangibles that make 
life worthwhile, and I sincerely hope that Congress has the 
courage to protect creators as new technologies disrupt their 
fields.
    I would like to thank Chair Issa for calling this hearing 
once again.
    Once again, I would like to thank Director or Register 
Perlmutter for being here. I look forward to hearing from you 
about your agency's work.
    Thank you.
    Mr. Issa. I thank the gentleman.
    I am now pleased to recognize the Ranking Member of the 
Full Committee, Mr. Nadler, for his opening statement.
    Mr. Nadler. Thank you, Mr. Chair.
    Mr. Chair, I would like to begin by thanking Ms. 
Perlmutter, the Register of Copyrights, for being here today.
    The Copyright Office bears responsibility for registering 
copyrights, examining copyright claims, and administering 
statutory licenses--not to mention advising Congress on new and 
emerging issues of copyright policy, among other 
responsibilities.
    As the Committee with jurisdiction over the matters related 
to the American judicial system, including intellectual 
property law, we have the responsibility to provide oversight 
of this critical office.
    Professional and amateur artists, authors, and coders rely 
on copyright protection to put their creations out into the 
world. These ownership rights promise that, with hard work and 
a lot of luck, it is possible to make a living from one's 
artistic and intellectual abilities.
    Our intellectual property laws foster creativity in the 
arts, as well as productivity and innovation. As such, the 
Copyright Office serves a dual role in American culture; it is 
protective of both the future and the past.
    While giving our hits the space to age gracefully into 
classics and for our visual artists the time to gain 
appreciation, the Copyright Office must also wrestle with 
integrating the newest artistic mediums and addressing 
philosophical questions about the use of technology in human 
creations.
    What we determine holds value, and how we choose to protect 
it, demonstrates to the world what we believe is important in 
this country. It is often the men and women in the Copyright 
Office who make those important determinations.
    Today, much of our conversation will focus on the future. 
Artificial intelligence, or AI, has changed and will continue 
to change the way Americans create. We cannot escape the novel 
difficult questions posed by the integration of AI models into 
our work.
    How should American creators interact with generative AI 
tools? What regulations will guide our innovations as a Nation? 
I was glad to see the Copyright Office address these questions 
this year in its March guidance and August Notice of Inquiry on 
the impact of generative AI. I look forward to hearing more 
about the results of the Copyright Office's examination of how 
AI will impact artists and intellectual property holders.
    The Music Modernization Act, which this Committee led 
efforts to enact in 2018, is an example of what can happen when 
an entire industry agrees to work together to protect creators. 
When streaming services arrived on the scene roughly a decade 
earlier, they disrupted the music industry's normal way of 
doing business. America's teenagers stopped waiting outside 
stores for the latest star's album to drop. Instead, the 
listening public moved online, where unlimited songs were 
available at their fingertips, and unfortunately, where there 
was no structure to ensure that songwriters could get paid.
    By creating the Music Licensing Corporation, or MLC, to 
ensure that songwriters receive the royalties they are due, we 
in Congress made clear that, no matter how the music industry 
evolves--and evolve it will--the people who write the songs 
deserve to be paid for their work.
    I'm looking forward to hearing from the Copyright Office, 
as the entity responsible for the administration of the MLC, on 
how it believes the MLC is accomplishing its goals.
    Some protections simply never existed in the first place. 
The United States is the only democratic Nation in the world 
that does not pay its performing artists when their songs are 
played on terrestrial radio. There is no reason not to pay our 
creators for their work.
    That is why I am proud to join Chair Issa in leading the 
American Music Fairness Act, which would require broadcasters 
to pay artists when their songs are played on the radio. Our 
actions should match our values, and paying artists when their 
songs are broadcast on AM and FM radio would take a vital step 
toward that ideal.
    The Copyright Office's jurisdiction is broad. Today will be 
an opportunity to expand beyond AI and music. I am also looking 
forward to hearing from Ms. Perlmutter about the status of the 
implementation of the CASE Act; how the Copyright Office is 
modernizing its outdated IT systems to better serve artists, 
and what changes, if any, need to be made to Section 1201 of 
the DMCA.
    Thank you, Mr. Chair, for holding this hearing, and I yield 
back the remainder of my time.
    Mr. Issa. I thank the gentleman.
    I now recognize--oh, sorry. Without objection, all other 
opening statements will be included in the record.
    It is now my honor to introduce our sole and important 
witness. Ms. Perlmutter is the Register of Copyrights and 
Director of the Copyright Office. She was appointed in October 
2020. Prior to her appointment, she served as the Chief Policy 
Officer and Director of International Affairs for the United 
States Patent and Trademark Office.
    We welcome our witness today and thank her for appearing.
    I would ask that you please rise to take the oath.
    Do you solemnly swear or affirm, under penalty of perjury, 
that the testimony you are about to give will be the truth and 
correct to the best of your knowledge, information, and 
beliefs, so help you God?
    Ms. Perlmutter. I do.
    Mr. Issa. Thank you. Please be seated.
    Let the record indicate the witness answered in the 
affirmative.
    Since you are the sole witness and the reason we are here 
today, we won't hold you strictly to the five-minutes, but the 
sooner we get to questions, the happier people here on this 
other part of this very cold room will be.
    I'm noting that because we asked to have it warmed up and 
we will do our best.
    Thank you, and you are recognized for your statement.
    We will turn the mic on. I know it is a little cold this 
morning, too.

             STATEMENT OF THE HON. SHIRA PERLMUTTER

    Ms. Perlmutter. There we go.
    Mr. Issa. OK, and then, get it a little closer, and we will 
all be happy. Thank you.
    Ms. Perlmutter. Good morning, Chair Issa, Ranking Member 
Johnson, and Members of the Subcommittee.
    Thank you for the opportunity to update you today on the 
recent accomplishments and current projects of the Copyright 
Office.
    The past year has been very productive on multiple fronts. 
We have substantially improved processing times, while making 
significant progress on IT modernization.
    We've launched work on artificial intelligence; marked a 
full year of operations of our new small claims tribunal; 
produced a number of policy studies; developed an economic 
research agenda, and engaged in rulemakings under the Music 
Modernization Act, as well as commencing the next Section 1201 
rulemaking.
    The Office's law and policy activities have been wide-
ranging. Most notably, we have moved quickly to address the 
copyright implications of artificial intelligence. Early this 
year, we announced a broad AI initiative, and in March, issued 
guidance on how to apply to register works that incorporate AI-
generated content.
    That guidance reaffirmed our longstanding position that 
human authorship is required for copyright protection--a 
position that was recently upheld by the District Court for the 
District of Columbia.
    Over the past six months, we've held a series of public 
listening sessions and webinars and have met with a diverse 
range of interested parties.
    We, then, published a Notice of Inquiry at the end of 
August seeking public comment on a full range of copyright-
related issues, including the legal treatment of the ingestion 
of copyrighted works for machine learning; the copyright-
ability of the output, and the imitation of the likeness and 
style of human creators.
    As of the first anniversary of the small claims tribunal, 
the Copyright Claims Board that was established by the CASE 
Act, nearly 500 claims have been filed--with about 10 percent 
of them so far in active proceedings. We've seen a steady 
influx involving a wide range of types of works with strong 
participation by individuals appearing pro se.
    Over the past year, the Office has responded to 
congressional inquiries on a number of issues, including 
studies on deferred examination of registration applications; 
on electronic deposits and the best edition requirement; and on 
standard technical measures, as defined in the Digital 
Millennium Copyright Act.
    We are currently completing a study on non-fungible tokens 
and intellectual property jointly with the Patent and Trademark 
Office.
    In our role administering the Copyright Act, the Office 
registered over 484,000 claims to copyright for millions of 
works in fiscal 2022.
    Processing times are at a historic low. The average for all 
copyright claims now stands 2.1 months. For fully electronic 
claims that don't require correspondence, the average is just 
over 1 month.
    We also recorded more than 14,000 documents containing 
titles of over a million works. A major milestone was reached 
last year with the opening of our online recordation pilot to 
the public. Almost 80 percent of all basic recordation 
documents are now submitted online, and processing times are 
measured in weeks rather than months.
    We've completed the consolidation of deposit materials from 
several facilities into a single modern warehouse to enable 
faster location services that are tracking and improved 
security.
    We're also implementing a new multichannel contact center 
to enhance communications with the public.
    Modernization remains a top priority. The planned 
Enterprise Copyright System, or ECS, will update and connect 
all our services, making them more efficient and easier to use. 
The first public releases were the online recordation system 
and a pilot of our new Copyright Public Records System.
    Development of a new and improved registration system is 
now well underway, and we've made considerable progress in 
digitizing pre-1978 records and making them available online.
    As the ECS becomes fully operational, we will focus on 
continuous development with regular maintenance and updating to 
avoid repeated overhauls of legacy systems.
    Finally, we've expanded our outreach through a greater 
range of educational materials and events offered to more 
audiences to further our goal of copyright for all.
    So, let me close by thanking the Subcommittee for your 
support of the Office's work to foster creativity and promote a 
thriving copyright system.
    [The prepared statement of the Hon. Perlmutter follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Issa. Thank you.
    I'm going to forego my questions initially and go to Mr. 
Fitzgerald.
    Mr. Fitzgerald. Thank you, Mr. Chair.
    Thank you for being here today.
    September 5th, the Copyright Office recently published an 
interpretative rule in the Federal Register relating to when 
late fees apply under the Music Modernization Act, instead of a 
proposed rule that would have been subject to public notice and 
comment. Given the potential commercial impact and the 
disruption of settled industry practices by this rule, can you 
speak to why the Associate Register of Copyrights, Suzy Wilson, 
is listed as the signatory on the rulemaking rather than 
yourself?
    Ms. Perlmutter. Suzy Wilson, as you said, ``Associate 
Register and also General Counsel.'' It is not unusual for the 
General Counsel to sign regulations that we issue in the 
Federal Register. It had no other substantive significance 
beyond that.
    Mr. Fitzgerald. OK. Very good.
    Do you or your office intend to issue further 
interpretative rules that circumvent public comment periods?
    Ms. Perlmutter. With that rule, in particular, we had 
originally asked for comment because we had heard different 
views expressed on the issue of the late fees. Once we looked 
at the comments and evaluated the statute further, we concluded 
that the statute was clear on the late fee issue and that it 
would be up to the CRB to determine any different treatment of 
late fees.
    Mr. Fitzgerald. Very good.
    Music fans, generally, want to listen to their favorite 
artists and songs regardless of which record label or artist it 
belongs to, or which PRO has particular rights to any given 
song. We had a wonderful field hearing in Nashville in which 
that point was brought up many times by many different 
individuals.
    They made the point; an individual song may have multiple 
writers who belong to different PROs. So, radio stations and 
music service providers generally need to license from all 
PROs, rather than just one or two. This arrangement, as you 
know, leads to a consistent upward trajectory of royalty rates 
because, if a PRO, like a GMR, it gets a high rate through 
contracting with in-demand songwriters, this rate will serve as 
a benchmark for negotiations with other services for a new, 
higher rate which can be used by the next PRO to negotiate a 
new rate, and so on.
    Can you talk about what your office is doing to keep the 
music affordable to customers?
    Ms. Perlmutter. The Copyright Office is not involved in 
rate-setting, either through the PROs or in terms of the work 
of the CRB in setting rates for music. So, we have a defined 
scope of authority in this area, and there are certain things 
we are regulating, but the actual amounts of the license fees 
we do not handle.
    Mr. Fitzgerald. So, would it be accurate to say, then, no 
matter what happens with those rates, that you would not 
intervene, and you certainly would not get involved in that 
discussion?
    Ms. Perlmutter. We would not intervene, although, to the 
extent that Congress is looking at any legislative changes, we 
would be happy to offer any kind of technical advice and 
assistance.
    Mr. Fitzgerald. OK. All 10 publishers represented by voting 
members of the MLC's Board are also represented on the Board of 
the National Music Publishers' Association. Are you at all 
concerned that this overlap raises questions about the MLC's 
independence and the ability to function as a neutral 
administrator?
    Ms. Perlmutter. We're aware that some have raised those 
concerns, and we do think it would be valuable to address those 
concerns and avoid any perceptions of a lack of balance. So, we 
would certainly be happy to discuss further any potential 
solutions. Any change in the board composition, however, would 
require statutory change.
    Mr. Fitzgerald. Just one final question. The other thing we 
heard on the field hearing was that there were many artists 
that the MLC was having a difficult time even locating. Have 
you been involved in that process at all, or do you oversee 
that in any way?
    Ms. Perlmutter. Yes, and we did do a study and issue a 
report about two years ago now with recommendations for the MLC 
and how to improve matching, to be able to pay out to the 
appropriate copyright owners.
    Mr. Fitzgerald. Do you think that has improved or are you 
tracking that at all?
    Ms. Perlmutter. I think it's improving. In terms of the MLC 
paying out under the new, blanket statutory license, I 
understand they've reported about a 90 percent match rate at 
this point. Then, in terms of matching the historical unmatched 
royalties, we believe that's improving.
    We recommended that the MLC not pay out for at least five 
years, so that there was more time than the statute, the 
statutory minimum to make, to do as much matching as possible 
and identify as many copyright owners as possible. It is our 
understanding that at this point in time the MLC is not 
planning to pay out the money anytime in the near future.
    Mr. Fitzgerald. Very good.
    I yield back.
    Mr. Issa. I thank the gentleman.
    We now recognize the Ranking Member of the Subcommittee, 
Mr. Johnson of Georgia.
    Mr. Johnson of Georgia. Thank you, Mr. Chair.
    Register Perlmutter, in its guidance, the Copyright Office 
argued that both the Constitution and the Copyright Act define 
an author as ``a human entity,'' excluding nonhuman creations, 
and noted that this stance is reinforced by various court 
rulings, and concluded that those using AI in their creations 
can claim copyright protection only for their human 
contributions.
    How did the Copyright Office make that determination, and 
how will that bright line help artists and creators survive in 
fields that will increasingly be filled with AI-generated 
works?
    Ms. Perlmutter. Well, I would divide my answer into two 
parts. So, the first part is the issue of the protectability of 
the output, the protectability of individual works that are 
generated using AI. To the extent that humans use AI as a tool, 
that should not affect the protectability of the work. The 
human author would still be the creator and the work would be 
protected by copyright. Using AI as a tool is not something 
entirely new. It has been used, in particular, in the music 
field, for example, for decades in various ways.
    The issue that we address because it was squarely put 
before us, in particular, in the Thaler case, was a situation 
where the claim was that a work was generated solely by a 
computer and in that situation, looking at the word author and 
both the Constitution and the statute, as you have noted, Mr. 
Johnson, we believe that this term implies human authorship and 
not that of a machine. That position was borne out by a number 
of court cases over decades, if not centuries. So, we were 
pleased to see the District Court and the District of Columbia, 
as I mentioned, agree with us on that. What we are trying to do 
is to guide people as to how they can register works that 
include generative AI outputs. In that context, we said they 
should just disclaim the portion of the work that was generated 
by AI and we will issue a registration for the work as a whole 
where there is some human authorship.
    The second part of the question I think really relates to 
what effect it will have on the ability of human creators to 
make a living when their works are input into the computer for 
purpose of machine learning and then the output might compete 
in the marketplace with their work. That is an issue that we 
are going to be studying that we have asked for comments on our 
Notice of Inquiry. We agree, it is a critically important issue 
for the future. We need to make sure that we do not inhibit the 
development of very exciting new technology, while at the same 
time ensuring that human creativity continues to thrive.
    Mr. Johnson of Georgia. Thank you. Many AI models are 
trained on copyrighted data, but not all the training data is 
licensed. Why is it important that copyrighted information used 
to train AI be licensed?
    Ms. Perlmutter. One of the issues that is presented both 
before us and that we have asked questions about in the Notice 
of Inquiry and also in some of the court cases that are pending 
is the extent to which any use of copyrighted works in training 
the AI may qualify as fair use. To the extent it qualifies as 
fair use, it would not need to be licensed. To the extent there 
are certain uses that do not qualify as fair use, there would 
be a need to obtain licenses. Then we have asked the further 
question of how would that be done as a practical matter? Can 
it be handled through direct licensing? Should it be handled 
through collective licensing? Or should Congress consider some 
sort of new compulsory license system?
    So, a lot of open questions still and we will be exploring 
all those as we review the responses to our Notice of Inquiry.
    Mr. Johnson of Georgia. Would licensing be sufficient?
    Ms. Perlmutter. It would certainly deal with the need to 
have authorization if a use falls within the rights under the 
Copyright Act and doesn't qualify as fair use. So, it would 
deal with the authorization element. Presumably, it will also 
deal with the compensation element and depending on the terms 
of license, at the license, it could also require credit being 
given to the creators.
    Mr. Johnson of Georgia. Thank you. My time is about to 
expire, so I will yield it back.
    Mr. Issa. I thank you for the six-seconds. We now go to the 
gentleman from Virginia, Mr. Cline.
    Mr. Cline. Thank you, Mr. Chair. Register Perlmutter, thank 
you for being here. You do a great job, and your 444 employees 
are well served.
    I want to go back to the subject of a hearing we had back 
in July with the MCA and Section 1201 and right to repair. The 
DMCA was introduced back in 1998 to address the evolving 
relationship between copyright, the internet, and merging 
technologies. Section 1201, as you know, prohibits the 
circumvention of technological protection measures designed to 
safeguard copyrighted works. Your office oversees a triennial 
rulemaking process pursuant to the DMCA to grant specific 
exemptions to 1201, balancing copyright protection with 
technological advancement. Some have called for reform of this 
process, particularly those who rely on exemptions to enable 
third-party repair of devices with TPMs.
    With respect to those issues, do you believe that Section 
1201 should be modified statutorily, or do you think the 
Copyright Office will make an authority sufficient to address 
the needs of copyright holders and consenters?
    Ms. Perlmutter. My answer would really be both. We are able 
through rulemaking to address the right to repair issue and we 
have done it in I think in the last three successive 
rulemakings. On the other hand, that is not the most efficient 
way to do it. It requires a lot of work from stakeholders and 
from the Copyright Office every three years. For that reason, 
in our report on Section 1201 a few years ago, we did recommend 
a statutory permanent exemptions for the right to repair in 
appropriate circumstances and we still believe that would be 
advisable.
    Mr. Cline. Can you talk about what are the most important 
reasons that led to your office's decision to expand those 
exemptions in that space?
    Ms. Perlmutter. We did hear that there were many situations 
where because copyrighted software is incorporated into devices 
of various kinds, and because it is protected by encryption or 
other technological measures, that the MCA's prohibition on 
circumventing technological measures made it impossible for 
people to get access for purposes of repair. So, for that 
reason, in particular contexts which were medical devices, 
consumer devices, and vehicles, we did put in place, we 
recommended to the Librarian of Congress, and she put in place, 
I should say, exemptions allowing circumvention in those 
situations to make repairs.
    We continue to believe that is a valuable tool for people 
to have and therefore we would support addressing it in a 
permanent way rather than through a triennial rulemaking.
    Mr. Cline. So, in your view, this expansion could lead to a 
proliferation of third-party repair shops and emergence of a 
more competitive and robust repair industry?
    Ms. Perlmutter. It may, yes.
    Mr. Cline. Now, that you have recently initiated your ninth 
triennial rulemaking process, we know that petitions for 
renewing existing exemptions and new exemptions were due August 
25th, can you offer any insight into new exemptions that are 
being requested and how they compared with requests over the 
past several rulemakings?
    Ms. Perlmutter. We have had a few new requests, not a 
deluge of them. We never know until we get them. We will be 
issuing a Notice of Proposed Rulemaking in October which will 
set out our recommendations on all the requests, but I don't 
think anything will be a tremendous surprise. There are a 
number of requests to renew existing exemptions or expand them 
and just a few new ones, not a lot.
    Mr. Cline. Talking about TPMs, rights holders argue that 
aside from protecting IP TPMs, ensure device safety, security, 
and reliability, what has your office found in terms of whether 
the increased granting of exemptions weaken IP rights for 
owners and present security issues for consumers?
    Ms. Perlmutter. We have not been made aware of any serious 
problems arising from any of the exemptions that the Librarian 
has granted. So far, what we have recommended, and the 
Librarian has adopted, have been very carefully delineated 
exceptions that are drafted in such a way that we believe 
avoids negative impacts.
    Mr. Cline. Thank you. I yield back.
    Mr. Issa. I thank the gentleman. We now go to the Ranking 
Member of the Full Committee, Mr. Nadler, for five minutes.
    Mr. Nadler. Thank you, Mr. Chair, and thank you for 
appearing before the Subcommittee. Unlike most other regulatory 
agencies, the Copyright Office has taken concrete steps toward 
studying and guiding the adoption of artificial intelligence 
with its guidance and Notice of Inquiry. How do you see the 
Copyright Office's role in AI regulation?
    Ms. Perlmutter. We have two separate roles. One is our role 
as the administrator of the Copyright Act and registering 
applications or registration, accepting applications for 
registration. There, we are having to make day-to-day decisions 
looking at specific examples of works created using AI 
technology and the extent to which there is a human 
contribution that can be protected by copyright. So, in a way, 
we are a bit of a natural laboratory for looking at what the 
dividing line is between human and computer creation.
    The second role that we play is as an advisor to this body 
and also to the courts and to other Executive Branch agencies 
on copyright law and policy. In our Notice of Inquiry, we are 
looking at all these issues. We are looking at whether we need 
to refine in any way the guidance that we issued in March on 
registration and we are looking at what the policy implications 
are and whether we would recommend any changes to legislation 
or regulation.
    Mr. Nadler. Well, you may have answered part of my next 
question. How should intellectual property be considered when 
Congress or the Executive Branch as a whole decides to regulate 
AI?
    Ms. Perlmutter. I am sorry. Can you repeat the question?
    Mr. Nadler. How should intellectual property be considered 
when Congress or the Executive Branch as a whole decides to 
regulate AI?
    Ms. Perlmutter. I think as a result of the input that we 
will get in response to the Notice of Inquiry we will have a 
better sense of the extent to which any changes to the 
copyright law are necessary. I know that this overlaps a bit 
with some of the questions more broadly affecting society from 
the development, in particular, generative AI dealing with 
security issues, and dealing with privacy issues. So, I think 
it is important to keep an eye on potential overlaps and 
potential relationships. At the moment, it appears that the 
copyright issues could be dealt with separately, that we don't 
yet see any necessary overlap between other initiatives 
relating to AI, but that may change as we continue to examine 
and follow what is happening in the space.
    Mr. Nadler. Thank you. What are the potential pitfalls of 
AI adoption in artistic fields like music, visual arts, and 
writing?
    Ms. Perlmutter. There have been great concerns expressed by 
creators and performers about the impact of a proliferation of 
AI-generated content on their ability to make a living. There 
are still a lot of unknowns about what the economic effect will 
be, and we are looking at those issues as well as the legal 
issues.
    In terms of the protectability of AI-generated content, 
there are a lot of questions about the extent to which it might 
replace human-generated content, what consumers are going to be 
interested in seeing, hearing, and listening to. So, all these 
issues are very much up in the air. We are looking to find out 
through the Notice of Inquiry all the concerns that people 
have, and we will take those into account in writing a report 
once we have had a chance to review the input.
    Mr. Nadler. Thank you. A professional portrait artist takes 
an average of 3-6 months to create a work of art. As they 
become more popular, their work will often change hands, 
becoming more valuable with each sale. If the artist will never 
see a painting of these later sales, does the Copyright Office 
continue to support the passage of Resale Royalty Scheme for 
visual artists?
    Ms. Perlmutter. Yes, we do, for exactly the reason that you 
mentioned. I think the copyright system for a long time has not 
served visual artists who create unique works of art as well as 
it has served other types of creators and having the ability to 
obtain a share in the money that is made when an original work 
is resold is one way to allow an artist to continue to benefit 
from an increased demand.
    Mr. Nadler. Thank you. My last question is under the 
current statutory framework, radio broadcasters do not need to 
compensate artists when their songs are played on AM/FM radio. 
What would be the benefits of legislation requiring royalty 
payments to the broadcast of artists' songs and what resources 
would the Copyright Office need to distribute those royalties?
    Ms. Perlmutter. This is an area where the Copyright Office 
for many years has recommended legislation. The United States 
is one of very, very few countries in the world that do not 
provide a full public performance right for sound recordings 
covering over-the-air broadcasts and we believe it is past time 
to do so. If we do so, that will mean more money coming into 
the United States from other countries that provide that right 
to performers, but only on a reciprocal basis, so they will not 
pay performers in the United States because the U.S. doesn't 
have an equivalent rate.
    Mr. Nadler. Thank you for supporting Chair Issa and my 
legislation and with that, I yield back.
    Mr. Issa. Thank you. We now go to the gentleman from Texas, 
Mr. Moran, for five minutes.
    Mr. Moran. Thank you, Mr. Chair. Director Perlmutter, thank 
you so much for your time today. I wanted to start out by 
talking a little bit about what kind of cooperation we have had 
across the globe with dealing with copyrightability of AI-
generated works. Can you tell me what level of cooperation we 
are currently engaging with other countries across the world 
with respect to this issue?
    Ms. Perlmutter. Yes, that is a very important question. 
Thank you. Of course, we can't only look at the issues within 
U.S. borders because the technology involved in AI can be 
international in scale. The databases can include copyrighted 
works from around the world. The technology is developed by 
different groups around the world, so we need to think about 
the international implications.
    We are in touch with our counterparts in other countries. I 
have been to numerous meetings just over the last nine months 
with copyright policymakers in a plethora of different 
countries, so we are trying to make sure that we talk to each 
other, that we understand what is happening and why.
    We are also participating in conversations through the 
World Intellectual Property Organization with other countries 
as well. The goal really is to say having a certain level of 
consistency and how we treat this issue and how we address the 
issue is going to be desirable. We don't need to have identical 
laws, but we should have consistent laws.
    Mr. Moran. I like the way you put that because we certainly 
want to contain our sovereignty here and make our own 
determinations, but consistency certainly provides some 
benefits to our human artists.
    Who is leading on this issue as you have been talking 
across the globe? I met with some folks from the E.U. 
Parliament last week. They seemed to be doing a lot in this 
space to determine what kind of framework should exist in the 
copyright and AI space. Who would you say is somebody we need 
to look at for leadership in this world that we need to 
cooperate with?
    Ms. Perlmutter. It is interesting because the Copyright 
Office here has become the leader in looking at the 
copyrightability issue because of our system of examining works 
submitted for registration. So, a lot of countries are looking 
to us on that particular issue.
    On other issues, yes, the E.U. has moved forward with The 
AI Act, which I believe is expected to go into force later this 
year, and that deals with transparency issues and the question 
of providing information about what copyrighted works have been 
input into the machine. Then, we have seen a lot of activity 
also in other countries, such as, Japan, Korea, and Singapore, 
for example.
    Mr. Moran. Let me switch gears and talk about the Copyright 
Claims Board for a moment. At the one-year mark of its 
establishment, there were over 500 cases filed with the 
Copyright Claims Board. Does the Copyright Office have enough 
resources to ensure the smooth operation of that board? Could 
you talk about that?
    Ms. Perlmutter. Yes. Thank you for that question. So far, 
the answer is yes, but we need to see how this evolves in the 
coming months and years. So far, the cases are coming in at a 
pretty steady rate and our fears in the beginning that we might 
be inundated have not yet happened, so there is plenty of work. 
At the moment, we have a team that is large enough to handle 
it. We will certainly come back and report if that turns out 
not to be the case.
    Mr. Moran. Speaking of reports, how are you keeping track 
of the statistics and the outcomes of the CCB cases? Talk to me 
about that.
    Ms. Perlmutter. A lot of data and information is publicly 
available on our website about the cases that have been filed. 
We are also developing internal charts and graphs to try to get 
a sense of what is happening and in what sectors. We will 
continue to make information available as is feasible.
    Mr. Moran. All right, and then finally, we have got about a 
minute, I want to go back to this NOI that you were talking 
about earlier. In August of this year, as you noted, ``the 
Copyright Office initiated a Notice of Inquiry to better 
understand the use of copyrighted works in training AI 
models.'' As of about September, mid-September, I think you 
guys have had 15,000 responses. I know we are not yet to the 
deadline of responses. Can you highlight some of the key 
feedback you have already received including before the NOI?
    Ms. Perlmutter. I think what tends to happen is that we 
will get a rush of early responses as soon as we publish our 
notice and that is what happened. That is why the numbers seem 
high. Then we will tend to get many of the much more detailed 
responses late, like probably right near the deadline. So, at 
present, we are still going through the responses we have 
received so far. I think they have tended to be mostly 
reactions to the fact that we are doing the study and people 
talking about how important this is and how major the impact 
could be on their lives and careers.
    Mr. Moran. OK, thank you, Director. I yield back.
    Mr. Issa. I think the gentleman. We now go to the 
gentlelady from North Carolina, Ms. Ross.
    Ms. Ross. Thank you, Mr. Chair. Thank you for joining us 
today, Register Perlmutter.
    My home district in North Carolina is home to creators in a 
variety of creative fields from musicians to visual artists to 
filmmakers to writers. As a matter of fact, we are having a 
bluegrass festival, international bluegrass festival this 
weekend which I am sorry I will not be there for. We all 
benefit from the work of these artists who make our lives 
fuller and richer with their creativity, their skill, their 
dedication, and their craft. They would not be able to produce 
the work they do without strong copyright protections that 
allow them to make a living as creators. So, I am grateful for 
this opportunity to hear from you about initiatives that the 
Copyright Office is taking to ensure that creators can continue 
to profit from their work.
    In June 2022, the Copyright Office report titled, 
``Copyright Protections for Press Publishers,'' in that report, 
the Office addressed the fact that there is still no practical 
method available from the Copyright Office for copyright owners 
of dynamic and voluminous content, such as a news website or a 
mobile app to register their content. The advent of AI which 
enables new types of infringement puts publishers in an even 
more precarious position, as we know the news industry is also 
in a precarious position. In the report, the office stated the 
office takes these concerns seriously and is considering how to 
best address them as part of its ongoing modernization 
initiative.
    How has the office taken steps to address these concerns.
    Ms. Perlmutter. We do take the need for this very seriously 
and in fact, we are working on a Notice of Proposed Rulemaking 
at this moment on a group option for registering news websites, 
so that should appear soon. We believe we can do it within our 
existing technological capabilities and not wait until ECS is 
fully developed.
    Ms. Ross. Thank you. I am the lead democratic sponsor, 
along with the chair of a bill called the Pro Codes Act which 
would protect the copyrights of standards and codes 
incorporated into law while requiring a free version of each 
code to be published online. At our July markup of the Pro 
Codes Act, questions were raised about whether granting 
copyrights in industry standards such as the National 
Electrical Code was somehow improper or violated the government 
edicts doctrine. Given that the Copyright Office has issued 
thousands of copyright registrations for industry standards 
over the course of decades, it appears that the Copyright 
Office does consider such standards to be copyrightable.
    Can you further explain why allowing the private sector 
authors of standards to obtain and protect copyrights, even 
where those standards are later incorporated by reference into 
law does not violate the government edicts doctrine?
    Ms. Perlmutter. Our view is that the privately authored 
sets of standards are protected by copyright, as you note. This 
is an important incentive for the work that is required to 
develop these standards which can require a lot of thought and 
expertise, but that at the same time, the public should have 
access to them when they are incorporated into law because the 
public does have a right of access to the law.
    The courts have generally dealt with this issue so far by 
saying that while the standards themselves may be protected by 
copyright, the use of them generally falls under fair use if it 
is for purposes of using and applying and understanding the 
law. So, at present, we think the courts are handling this in 
an appropriate way.
    Ms. Ross. To compensate copyright holders for the use of 
their work to train AI models, some have suggested creating a 
licensing-type system for these works, similar to what the 
Music Modernization Act streamlined for music. From what you 
have seen of the Music Modernization Act effects, what do you 
think about these proposals?
    Ms. Perlmutter. First, I would say I think the Music 
Modernization Act is working very effectively. The issue of 
whether there should be a similar license for training AI is a 
complicated one. It would involve all types of works, not just 
musical works, and be far reaching in its scope. That is why we 
are asking questions about it in our Notice of Inquiry. I think 
there are a lot of practical issues involved that need to be 
explored including about how the license fees would be set, how 
it would be distributed, and if it is, how it can be made 
feasible given the volume of works that would be involved.
    Ms. Ross. Thank you, Mr. Chair. I yield back.
    Mr. Issa. Thank you. Thank you very much for your line of 
questioning.
    Now, we will go to the gentlelady from Florida, Ms. Lee.
    Ms. Lee. Good morning, and thank you so much for being 
here. I would like to start by returning to the discussion of 
the Copyright Claims Board and specifically, I think it is very 
interesting that you made great use of that, and it seems to be 
off to a productive start. I am interested though, there is a 
set of claims that were rejected because they were 
noncompliant, or they didn't meet the technical standards for 
going through that resolution process.
    Could you share with us what your office is doing to 
provide resources or guidance for those who are trying to 
utilize the Copyright Claims Board process?
    Ms. Perlmutter. Yes, thank you for that question. I am very 
proud of what we are doing to help people use the process. We 
have a website with a wealth of information. We have a handbook 
to tell people what they need to do to use the system. We have 
people who answer the phone and answer questions if anyone 
calls. We are also reaching out to get law school clinics and 
volunteer lawyers for the arts signed up to help people 
navigate the system even though they do not need to be 
represented by an attorney. We are doing a lot of outreach, a 
lot of public speaking about it.
    The system is set up so that there are a number of 
safeguards against inappropriate claims being brought so that 
was very carefully thought through by Congress in enacting the 
CASE Act, of course, and there are several opportunities along 
the way if a claim is noncompliant, the Board attorneys will 
tell the claimant and the claimant has two opportunities to 
revise the claim to make it compliant. I will say some of the 
lack of compliance we see is people sometimes bringing claims 
that, for example, don't involve copyright law, maybe a patent 
claim, or a claim against a foreign respondent which is not 
permitted under the statute.
    Ms. Lee. Based on what you have seen so far with the 
inception of the program and its progress to date, what do you 
anticipate being the future of the program? Do you anticipate 
it is going to be broadly utilized? Any challenges or things 
that you need Congress to do to help you succeed?
    Ms. Perlmutter. It seems to be very successful so far. The 
public reaction, the public reviews of what is going on have 
been positive. The system is working. We have had a number of 
final decisions, some based on settlements that have been 
entered into the record and we have found that while some 
respondents opt out, many respondents also are happy to proceed 
in the CCB and prefer the certainty of knowing that their 
potential damages are limited. So, we think it is working well 
and the upward trend has been quite steady, so we think that it 
will continue to go up, but presumably unless something really 
unusual happens, the trajectory won't change. We may need 
further resources, especially as we seek to further develop the 
eCCB, which is the electronic case management system. We will 
keep the Subcommittee apprised.
    Ms. Lee. Speaking of your electronic case management 
system, one of the things you touched on in your testimony was 
your efforts to modernize and replace legacy IT systems. Would 
you share with us what you are working on there and your 
strategic plan to ensure that you are making the right 
investments that are going to stand the test of time?
    Ms. Perlmutter. It has been a huge priority for the 
Copyright Office. IT modernization, we are now in the fifth 
year of our originally planned modernization effort and now we 
are moving toward continuous development. The main highlights, 
as I described in my testimony, already we have moved from a 
very archaic paper-based recordation system in the last two 
years to one that is online. That has been huge. We are now 
focusing on registration. We expect in the next year to begin 
user testing for various components of the registration system 
including the handling of electronic deposits.
    We are also going to start recording Notices of Termination 
online which we have not yet been able to do and that will 
start in the next year. We are making more and more historical 
records available online, so people no longer need to come to 
our offices in Washington, DC, to do research. We are 
experimenting with AI tools ourselves to extract metadata from 
our records. So, we have a lot planned.
    Ms. Lee. Thank you. I yield the balance of my time to the 
Chair.
    Mr. Issa. Thank you. That metadata brings up just one quick 
question I will inject. You mentioned the disclaiming of AI 
produced. Can you envision that along with disclaiming that 
they include the metadata that shows where they--what they 
ingested, how it turned into what they produced that they are 
disclaiming? Are you considering that within your IT 
modernization?
    Ms. Perlmutter. That is a very interesting idea. We have 
not yet considered it. We generally have been trying, however, 
to make the application for registration as easy and simple as 
possible and have heard some concern that we might be asking 
for too many details and people would prefer that we make it 
still easy to fill out an application without having to provide 
a lot of information. We have to keep that in mind as we look 
at that.
    Mr. Issa. Thank you. To be continued. With that, I go to my 
colleague and classmate from many years ago in Congress, Mr. 
Schiff.
    Mr. Schiff. Thank you, Mr. Chair. Thank you, Director, for 
being here. Earlier this year, it was reported that TikTok was 
limiting a number of songs available within its app for some 
users in Australia in an attempt to test the importance of 
music to the app's users. As a result, the number of people 
using TikTok in Australia declined for three consecutive weeks 
after the rollout of the test, according to numbers from the 
data research firm data.ai.
    The test revealed what many creatives already know to be 
true. Much of TikTok's success can be attributed to copyright 
works by musical artists, many of whom I represent in my Los 
Angeles District, and who are often under compensated for the 
use of their work on TikTok's platform.
    Director, in light of what we have seen in Australia and 
what is suggests, what thoughts do you and your office have 
about how the United States can ensure that creators and rights 
holders are protected when their work is used on digital 
platforms?
    Ms. Perlmutter. Well, this is obviously a top priority for 
all of us in the copyright field. We have done a number of 
things over the years to contribute to that effort.
    We, of course, don't have enforcement capabilities in the 
Copyright Office, but we do provide input from a policy 
perspective on what the law should say. That has included over 
the last few years a report on Section 512 of the DMCA and some 
improvements that could be made in that section, as well as 
looking at how copyright owners are using technological 
measures to identify and protect their works. We continue to be 
interested in that and to look at ways that we can convene 
interested parties to continue to discuss improvements.
    We also continue to follow and review what other countries 
are doing in this respect and what tools have been adopted 
elsewhere that could be useful to American right holders.
    Finally, we work closely with the Executive Branch on 
initiatives that have to do with international enforcement, 
including the U.S. Trade Representatives Special 301 report and 
Notorious Markets report.
    Mr. Schiff. In terms of TikTok, do you think the remedy is 
primarily an enforcement one, or are there legislative changes 
you have recommended as a policy matter?
    Ms. Perlmutter. We have not, to date, looked at potential 
legislative changes. I have not been made aware of any 
proposals from stakeholders but would be interested in hearing 
more about it.
    Mr. Schiff. Let me turn to something else. Earlier this 
year the Supreme Court decided the Warhol v. Goldsmith case 
dealing with fair use. How do you think that decision impacted 
or clarified the way courts are supposed to apply the fair use 
analysis? How do you expect this ruling to impact any future 
rulemaking from the Copyright Office regarding the use of 
copyrighted material to train AI models?
    Ms. Perlmutter. We agree with the Supreme Court decision, 
which adopted a lot of the analysis of the U.S. Government. The 
government participated in that case as an amicus.
    It may be that the case will have an influence on the fair 
use analysis of the ingestion of copyrighted works for purposes 
of machine learning. It requires, well, it affirms the need to 
look at the markets for both the original work and the work 
that is based on the original work, the work that is the 
subject of the infringement claim, and to look at the extent to 
which they are competitive, that they share the same market, 
and the extent to which the defendant's use is commercial in 
nature.
    So, how that will apply to the analysis of fair use in the 
ingestion of copyrighted content for AI training is still up in 
the air. It will certainly affect it. We are watching the court 
cases to see how the courts react. We will, we have asked 
questions about this in our Notice of Inquiry. We will be 
analyzing it once we receive the responses as well. It does 
seem as if it will have an impact.
    Mr. Schiff. Well, certainly by those measures, whether it 
is in competition, the marketplace that test I think would be 
met, and that it is economic in nature is also plainly the 
case. Well, thank you, Director. I appreciate your work.
    With that, I will yield back, Mr. Chair.
    Mr. Issa. Could I ask you yield to me?
    Mr. Schiff. Of course.
    Mr. Issa. I just wanted to followup on one thing. You said 
fair use and then said use in commerce. Would you like to 
expand that linkage that fair use for not commerce is 
dramatically different than fair use when it is, in fact, 
turned into revenue?
    Ms. Perlmutter. Well, fair use is very context specific and 
requires weighing a lot of factors, as I am sure you're aware, 
Mr. Chair. One of the factors are the nature of the use, 
including the extent to which it is commercial or 
noncommercial. So, the courts will look at that as part of the 
total weighing, but it is not determinative. What the Supreme 
Court did in the Warhol case was to elucidate a bit further 
what the relevance was of the commerciality of the use.
    Mr. Issa. Thank you. Thanks for expanding.
    With that, we go to the gentleman from South Carolina, Mr. 
Fry.
    Mr. Fry. Thank you, Mr. Chair.
    Thank you, Madam Register, for being here today. I really 
appreciate the importance of this hearing and your testimony 
today.
    Judge Moran hit on this earlier. I want to explore this 
topic a little bit further. In August of this year, the 
Copyright Office initiated the NOI, the Notice of Inquiry, to 
better understand the use of copyrighted works in training AI 
models. Judge Moran asked, ``but I want to expand on that a 
little bit.'' What is--and I understand the themes. I know that 
the time is not yet finished in which people can comment. What 
are some of the early themes that you are seeing or the 
individual comments that come to your mind as some of the early 
feedback that you are receiving on the NOI?
    Ms. Perlmutter. I can't say that I have read all the 
thousands of comments we have received so far. Lawyers in the 
office are in the process of doing that. My understanding is 
most of the early comments came from individual creators and 
artists expressing concerns over what is happening.
    Mr. Fry. Just about the use of AI within their field?
    Ms. Perlmutter. Yes.
    Mr. Fry. Are they making suggestions on how to fix that, or 
they are just airing grievances?
    Ms. Perlmutter. Let me get back to you with an answer to 
that question. I will say it is interesting because creators 
and artists are very much on both sides of the issue in various 
ways, because I do want to make the point that many of them are 
using AI as a tool in the creation process and want to be sure 
they can continue to do that. At the same time, they are 
concerned about what the impact will be if AI-generated content 
is competing in the marketplace with their works.
    Mr. Fry. Madam Register, do you have any idea on the timing 
of when the Copyright Office might be able to make 
recommendations to us or a report to us based on this feedback?
    Ms. Perlmutter. I would like to say as soon as possible. I 
know that timing is important here because technology is 
evolving very rapidly and its impact is likely to start being 
felt. We would like to be able to make recommendations in a 
short timeframe.
    At the same time, we are aware that we are likely to be 
getting tens if not hundreds of thousands of comments. The 
comment period will end at the end of November. We will need 
some time to finish analyzing and absorbing and then writing 
the report. Hopefully, it will certainly be in 2024. I 
certainly hope it will be in the first half of 2024.
    Mr. Fry. Thank you. Some of the most resource intensive 
projects that the Copyright Office has on its agenda over the 
next six months, I imagine that is probably one of them. Do you 
have the resources to appropriately carry out those tasks, 
taking into account stakeholder comments, where applicable, and 
giving them due consideration?
    Ms. Perlmutter. I really appreciate that question. I 
believe we have the resources to do that at this point. It is 
true that we find ourselves doing more and more work as the 
copyright policy issues proliferate these days. At some point, 
we may need further resources. At present, we are well equipped 
to handle the work on our plate.
    Mr. Fry. Thank you for that. Under the MMA, the Copyright 
Office has an ongoing regulatory authority to promulgate 
regulations, to implement the law, and ensure that proper 
functioning of the Medical Licensing Collective in its duties, 
including ensuring it acts as a neutral administrator serving 
three primary sets of stakeholders, songwriters, publishers, 
and digital service providers.
    What steps can the Copyright Office take within its 
existing authority to improve oversight and transparency of the 
MLC, particularly, as redesignation approaches in 2025?
    Ms. Perlmutter. We are taking a number of steps in that 
respect. We hold regular meetings separately with each of the 
interest groups, with the publishers, the songwriters, the 
digital service providers, and the MLC itself. We have open 
rulemakings. We continue to have an open door for people to 
raise issues with us. We will, as you mentioned, commence a 
public notice asking for input with respect to redesignation 
starting early next year. We do think it is very important to 
make sure that all sides are heard and feel that they are able 
to participate in the process.
    Mr. Fry. What are some of the issues that are brought up in 
this, I guess, this sphere?
    Ms. Perlmutter. Well, the issues are constantly ongoing. 
Som there is, I think in general the process is working quite 
well. We do hear questions about perceptions that the board is 
not balanced because there are more members from the publishing 
community than the songwriter community. That is something that 
is set by statute. So, that would be an issue for Congress to 
address.
    Mr. Fry. OK. Final question. Given the increased usage of 
name, image, and likeness in the outputs of generative AI, what 
are your thoughts on how Congress can best understand and 
legislate on this issue?
    Ms. Perlmutter. This is also one of the issues that we are 
asking for input on in our Notice of Inquiry. A few years ago, 
the Copyright Office did a study on moral rights in the United 
States and as part of that study suggested that Congress would 
consider, might consider enacting a Federal right of publicity. 
There are a number of State laws that could cover the imitation 
of name, voice, and likeness that is currently taking place 
using generative AI. It is a patchwork of different laws in 
different States. So, the question is whether a Federal law 
that might either preempt State laws or at least set a ceiling 
or floor for what State laws can say would be desirable.
    Mr. Fry. Thank you. I really appreciate that.
    With that, Mr. Chair, I yield back.
    Mr. Issa. Thank you.
    With that, we go to the gentlelady from California, Ms. 
Lofgren.
    Mr. Lofgren. It is Lofgren.
    Thank you very much. Thank you--
    Mr. Issa. Sorry, Zoe.
    Mr. Lofgren. Ms. Perlmutter. First, just a kudos for the 
modernization efforts. I know we are not done yet, but we have 
made great progress. I want to thank you and the Librarian as 
well.
    Just a note on music modernization, I thoroughly think that 
was a triumph of collegiality and cooperation. There are a few 
bumps in the road. Part of it may be our fault. In terms of the 
songwriters, I am hoping that you can make an extra effort to 
reach out to them because of the, what Congress did, because we 
want to make sure everyone is heard. I know you believe in 
that.
    I want to talk about the right to repair. We haven't talked 
that much about Section 1201 in terms of reform. I raise that 
with some trepidation because people who have content worry, 
and I understand that. If you have a software tool that 
protects content, if it protects a movie, if it protects your 
song, if it protects your book, if it protects your visual art, 
you shouldn't be able to break that. So, I am not suggesting 
that.
    However, if you are using a software tool to protect 
something that isn't content, which is what you have addressed, 
that is a different situation. I am wondering, you can legally 
fix your tractor now, but you can't get the software that 
allows you to fix your tractor under 1201.
    So, I am wondering if we could craft a narrow exception 
that would not cause any concern among the content community 
that is specifically, narrowly, and unequivocally only directed 
toward the right to repair. Do you think that is possible to 
do? If so, would you help us?
    Ms. Perlmutter. Yes, I do think it is possible. In our 
office's report a couple of years ago on Section 1201, we noted 
that we had been recommending and the Librarian had been 
issuing exemptions to permit repair in certain circumstances 
and that it might make sense to have a permanent statutory 
exemption, so that this didn't need to be revisited every three 
years. We would still support that.
    Mr. Lofgren. We do have the triannual process for 1201 
exemptions. I want to thank you. When we did 1201, and I was 
here in the Congress when we wrote it, we didn't intend to 
allow cell phone companies to protect their monopolies. It was 
about protecting content, not factors, cell phones, or other 
equipment.
    You have a lot of work to do. I appreciate that, that you 
are not asking for more staff. If we were able to either 
streamline the 1201 process when it relates to noncontent 
issues or create a narrow exception that protects content, 
wouldn't that help relieve the workload in your office?
    Ms. Perlmutter. Yes, I think there are several areas where 
1201 could be amended that would make the process easier. I 
have to say I was around also when 1201 was written.
    Mr. Lofgren. Yes.
    Ms. Perlmutter. The idea of the amount of work it would 
require terrified me at the time. We have learned how to handle 
it. It is a lot of work.
    Mr. Lofgren. In terms of the right to your person, you have 
talked about that. It is really State law, publicity about 
yourself. It is important that we take steps more urgently on 
that given the artificial intelligence is already here. People 
are going to need to take action to protect their appearance 
and their personhood in AI.
    We don't have a statute I think in mind yet. I would very 
much welcome and ask for your assistance in crafting something 
that would provide that protection, but more importantly, that 
would think through how we might give people an easy avenue to 
enforce that right, because AI is massive. It is here. It is 
not going to be stopped. Yet, the potential for people to have 
their personhood misused is real, already here. Having a right 
and being able to enforce that right are two different things. 
Do you have comments on that?
    Ms. Perlmutter. We would be happy to assist in drafting.
    Mr. Lofgren. I appreciate that very much. We will followup 
with you.
    Mr. Chair, I yield back and thank you.
    Mr. Issa. I thank the gentlelady.
    We now go to the other gentleperson from California, Mr. 
Lieu.
    Mr. Lieu. Thank you, Mr. Chair. I want to thank Chair Issa 
and Ranking Member Johnson for holding this important hearing 
on copyright issues and to you, Register Perlmutter, for being 
here today and for your hard work and leadership.
    I also want to align myself with the comments of 
Congresswoman Zoe Lofgren in terms of the Music Modernization 
Act, which is coming up on the five-year anniversary. I was 
proud to have been a cosponsor of the Act. The MMA transformed 
the way songwriters, music publishers, and tech platforms 
operate under streaming models.
    The creation of the Mechanical License Collective has 
streamlined the administration, collection, and distribution of 
mechanical royalties. To date, it has paid out more than 1.3 
billion to songwriters and publishers. As Co-Chair of the 
Songwriters Caucus, I want to thank you and your entire team 
for continuing to work with the MLC in meeting its mandate to 
serve songwriters and ensure that they are compensated.
    So, I know you have answered a number of questions on fair 
use. I just want to understand. You are currently investigating 
the issue of whether it constitutes essentially fair use if a 
large language AI model trains itself on copyrighted works. Is 
that correct?
    Ms. Perlmutter. Yes, it is part of the questions in our 
Notice of Inquiry. Of course, it also will depend on the exact 
circumstances. So, not every use in training will be the same 
for fair use purposes.
    Mr. Lieu. When do you expect that to be completed?
    Ms. Perlmutter. Well, that will be part of our report or 
reports coming out of the NOI, so as early as possible in 2024.
    Mr. Lieu. OK. As part of the investigation, it is not only 
whether a large language model, let's say it trains itself on 
copyrighted Taylor Swift songs, but also you are looking at if 
it outputs lyrics in the style of Taylor Swift songs. Are you 
looking at whether that is fair use as well?
    Ms. Perlmutter. Yes. Of course, it will also be, whatever 
we say in our report will also be informed by any court 
decisions that have come out by that point in time in the cases 
that have been brought.
    Mr. Lieu. You have also said that essentially perhaps it 
should be essentially a Federal right for voice recordings 
because right now audio is not copyrighted, correct?
    Ms. Perlmutter. The style or sound of a voice is not 
protected by copyright.
    Mr. Lieu. Your office had issued a report basically 
suggesting that there should be some sort of Federal name, 
image, and likeness law essentially.
    Ms. Perlmutter. We recommended that Congress consider that, 
yes.
    Mr. Lieu. OK. That report laid out essentially a proposal 
that was around the same level as what California's protections 
are. Is that correct?
    Ms. Perlmutter. I am not sure if I would say it was the 
same level. It contained some of, it talked about the elements 
of that legislation in California. Of course, the report came 
out before we had the generative AI that we have today. So, any 
legislation would need to take into account what the current 
capabilities and contexts are.
    Mr. Lieu. All right. Thank you. In March of this year, your 
office issued, basically announced that a work that involves 
``sufficient human authorship'' can be copyrightable. So, let's 
say someone uses AI to write a song of which over half the 
lyrics are written by AI. Would that constitute sufficient 
human authorship? How do you determine what that means?
    Ms. Perlmutter. I wouldn't impose any strict percentage or 
numerical limit. So, less than half could be sufficient human 
authorship. It is really decided on a case-by-case basis. I 
find it very useful to think of this by analogizing it to a 
human and human situation. So, for example, if two people 
collaborated in writing a song, did each of them contribute 
enough authorship to make them co-author of the song? If the 
answer is yes in that context, then it should be the same in 
the AI context.
    Mr. Lieu. Ultimately for this you are just going to have to 
rely on trust, right, that someone actually discloses they use 
AI to help them with whatever creative work they are trying to 
copyright.
    Ms. Perlmutter. Yes, but that is true of all applications 
we receive. Applicants have to certify that what they are 
saying is truthful. It is a government document. There are 
penalties for making false statements. Of course, you could 
risk losing your registration.
    Mr. Lieu. Do you view AI software as different than other 
kinds of software that creators have been using for decades to 
make their creations better?
    Ms. Perlmutter. Yes, that is a good question. I think what 
we are seeing with the new generative AI in the last nine 
months or so does seem to be different, not just in speed but 
in kind from the technologies that were used before. I think in 
the past AI was used more as a tool. Now, what we see is that 
it is generating content that if it were generated by a human 
being would be protected by copyright. So, I think we have 
moved to a somewhat different world than we were in before.
    Mr. Lieu. Thank you.
    I yield back.
    Mr. Issa. I thank the gentleman.
    We now go to the gentlelady from Pennsylvania, Ms. Dean.
    Ms. Dean. I thank you, Chair. I thank the Ranking Member 
for hosting and holding this oversight hearing. Thank you, 
Register Perlmutter, for your work and the work of your 444-
person team to carry out the mission of the U.S. Copyright 
Office, which is promoting creativity and free expression by 
administering the Nation's copyright laws and by providing 
impartial expert advice. I thank you for that work.
    As an author myself, I benefit from and importantly rely 
upon the protections that copyright law provides. As we have 
all been discussing here, with the rise of AI these protections 
are more important than ever. So, I guess my theme for my five 
minutes is twofold. We must protect the spark of ingenuity that 
makes copyrighted work uniquely human, and so at this 
precipice, what are the top things we do to protect human 
content.
    So, I was thinking about your office. Are you able to 
identify AI-generated work? Are you concerned about applicants 
hiding AI copyright, AI work within a copyright registration 
request application? What are the steps that you go through? I 
have to say nightmarishly I go back to the days when I was a 
professor of writing. I would be reading papers and wondering 
are those student's words or are they someone else's. So, what 
is it that you have to do now in this world to identify AI 
within an application?
    Ms. Perlmutter. Our examiners look carefully at an 
application. We have issued this guidance that tells people if 
AI-generated content is included they need to disclose it. You 
are right. We have to trust, and we do take as factual the 
statements that are made in an application unless we have some 
reason to think they are not accurate.
    So, there have been situations where it has been obvious 
from the face of an application that some of the content in the 
work may have been generated by AI. So, our examiners will go 
back and ask the applicant about it and engage in some 
correspondence. What we have seen so far in some of the cases 
we have had is that the result is that the applicant will then 
end up disclaiming some portion of the work that is submitted. 
So that has worked, for example, in books where the 
illustration was generated by AI, but the text and the 
selection and arrangement of the text with the images was done 
by the human applicant.
    So, there is no way to be 100 percent sure. We are not 
unique in having that problem in today's world. We do our best 
to see from the face of the application and the deposit whether 
we think there is AI-generated content. Again, there are some 
legal requirements for people to be honest in the content, in 
the statements that they make to a government office.
    Ms. Dean. Absolutely. I was thinking of Mr. Lieu's question 
and sort of the reverse side of that. The office, your office 
instructs applicants to disclose all AI-generated content that 
is more than de minimis. What is de minimis?
    Ms. Perlmutter. It is not a new concept. So, the same rules 
apply, for example, if the work contains content created by a 
third party. That also has to be disclaimed if it is more than 
de minimis.
    We had a Webinar, we held a Webinar this spring where we 
walked people through the guidance and gave them a number of 
examples and told people that essentially what we mean by de 
minimis is, more than de minimis is if the material that is 
generated by AI would be protected by copyright if it were 
generated by a human being, then it should be disclaimed.
    Ms. Dean. Interesting, yes.
    Ms. Perlmutter. So, we are not talking about just some 
small portion or something incidental, but something that, 
again, if a third party had generated it, if a human being had 
generated it, you would disclaim it as a separately 
copyrightable work.
    Ms. Dean. That is logical. That makes sense.
    Finally, in the few seconds I have left, what has your 
office thought about or learned as a result of the labor 
disputes with the writers and the studios? Full disclosure, my 
son was on strike. He is part of the Writers Guild. In terms 
of, obviously one of the big issues was use of AI in written 
materials and in writers rooms. How is the Copyright Office 
connected there? What clear rules should we be developing?
    Ms. Perlmutter. Well, it is a good question. Clearly the 
strike, both strikes, SAG-AFTRA and the Writers Guild, showed 
how important AI has become to authors and performers, because 
it was a critical part as I understand it of the negotiations.
    We are now looking at what came out of the settlement on AI 
and analyzing it. Of course, we don't play a role because these 
are private party negotiations. It is not really a question of 
what the law says. It is a question of what they agree to. It 
is helpful to see what was thought to be important and what was 
thought to be reasonable as the private parties were 
negotiating. So, we will be looking carefully at the result.
    Ms. Dean. Again, I thank you for all the work that you and 
your office does.
    I yield back.
    Mr. Issa. I thank the gentlelady.
    We now go to the gentleman from California, Mr. Kiley.
    Mr. Kiley. I am going to yield the balance of my time. I 
did just want to say thank you for your testimony. I know that 
your office has been very active in getting input on these very 
novel and vexing issues related to AI. I have certainly heard 
from a lot of creators who have concerns in this area. I think 
it is really important that we be mindful of the ability of 
creators to protect their rights and intellectual property 
moving forward.
    So, with that, I yield to the Chair.
    Mr. Issa. I thank the gentleman.
    I am going to try and use up a little bit of Mr. Kiley's 
time to challenge you to expand on making the record clear as 
much as we can.
    So, let me go through some things that might happen to 
somebody's writings. You tell me whether they are clearly 
disclaimable, clearly ineligible, or clearly not a factor, de 
minimis as was said earlier. Spell check.
    Ms. Perlmutter. No need to disclaim. That is a tool that 
has been commonly used for a long time.
    Mr. Issa. Word substitution to create enhancements such as 
sort of a thesaurus might do.
    Ms. Perlmutter. I would say the same thing.
    Mr. Issa. Phrase enhancement, how is it better said.
    Ms. Perlmutter. I would also just say the use of a tool to 
enhance something that is created by a human would not raise an 
issue as to copyrightability.
    Mr. Issa. Enhancement of desirability based on machine-
learned desirability and focus group analysis.
    Ms. Perlmutter. I also would see that more as a tool. 
Again, the machine is not generating something that would be 
copyrightable if a human generated it.
    Mr. Issa. Final question in this series. Using these types 
of tools but a regenerative AI, if you ingested an entire book 
and 40 percent of the words, phrases, and content were changed 
while, in fact, the underlying intent of the author wasn't and 
that, but enhanced the desirability and all those other 
phrases, would that, in fact, be either disclaimable or 
ineligible?
    Ms. Perlmutter. So, the applicant wrote a book, and then 40 
percent of the book was--
    Mr. Issa. Ingested, has the book evaluated by AI for all 
these and other ideas, and the book, although the same book 
with the same happy ending or unhappy ending was modified with 
40 percent of the words and/or phrases being changed. I am 
using 40 as an arbitrary number.
    Ms. Perlmutter. It is a tougher question. I think what we 
are talking about here is you have got an original 
copyrightable work by a human, which is the book, and then a 
derivative work created by the machine, which probably would 
not be copyrightable as a separate work.
    Mr. Issa. If you publish only the one, which is--and I am 
using the example for a reason. Ms. Dean said it very well. You 
are a professor. You are evaluating somebody's work. In my day, 
I had to put up with the nuns in my college objecting to my 
handwriting and my spelling. That has now been collectively, 
creatively enhanced in a way that I would probably do better in 
at least theology. However, I also wrote a book. I probably 
would have written a much better book if it was ingested by 
regenerative AI today.
    The question is if Ms. Dean's book and my book were thrown 
in and hypothetically 40 percent of the words and phrases were, 
according to the machine, enhanced, but, in fact, the book was 
still a true copy of the author's work, what do you disclaim? 
What is copyrightable? What is not? It is an arbitrary 
question, but I thought for the record if you would give us 
your best analysis.
    Ms. Perlmutter. Yes, it is a tough question. I think one 
thing that is important to understand is that what we require 
in a disclaimer is just something that says the work 
incorporates AI-generated content and an explanation of what 
the human contribution was. So, it doesn't require really fine 
tuning and specificity.
    I think what your question really goes to is that these are 
not easy decisions. They are not easy lines to draw. So, one of 
the things when I talk about the Copyright Office being a 
natural laboratory for this is we are looking at individual 
applications and making case by case determinations, which is, 
of course, something that copyright law always requires. How do 
you draw the line between an idea and expression? How do you 
determine whether someone has contributed enough to be a co-
author?
    We are learning more and more each day as we look at more 
and more of these applications and make decisions on them. Some 
of those decisions are being challenged in the courts and will 
be being reviewed.
    Mr. Issa. I thank the gentlelady. I thank the gentleman for 
yielding the time.
    We now go to Mr. Ivey for five minutes.
    Mr. Ivey. Thank you, Mr. Chair. I want to commend you for 
having this hearing. I have only been on the Committee for 
about nine months now. I think we have done, of all the hearing 
we have done, I think we have done four that I would put in the 
substantive category. Three of them have been yours. I greatly 
appreciate that fact.
    Thank you, ma'am, for coming today. I appreciate the great 
work you are doing.
    I think we are in the hair-splitting segment of the hearing 
now. I am going to followup on some of the questions the Chair. 
I am trying to figure this out. I am a lawyer by training, but 
not productive law. I did litigation, unlike the copyright 
world where you are helping actual creations being made and 
protected.
    One of the things I was wondering about was, and I think 
you mentioned this earlier. So, you have got sort of a human 
creator who generates let's say a song and uses AI to help with 
the--there is a portion of the song that is in part generated 
by the AI. That is AI that has been trained and ingested other 
information or music from other sources. I think what you were 
saying was that the creator, when the human creator comes to 
seek a copyright, has to explain or disclaim that there was AI 
generation as part of the final overall work. Is that right?
    Ms. Perlmutter. Yes, they would not have to disclaim the 
use of AI as the tool, like to provide a beat or that kind of 
thing or to change a rhythm. They would if there was let's say 
a melody created entirely by AI that they incorporated into 
their larger musical work.
    Mr. Ivey. OK. So, we will go forward with that. I have got 
a son that creates beats. He would disagree with where you drew 
that line right there, but we will set that to the side.
    So, the melody line, so, and let's say then that, because 
we have got people who approached me, for example, and they 
were complaining about AI being trained using their creative 
work product. So, in the song that you and I just made, and 
this author says I had AI-trained assistance in generating this 
song. How was, or has there been a determination that has been 
made with respect to the people who helped create the content 
that was used to train the AI that was then used in this song? 
How are they, or compensated for their work, or is it 
recognized even?
    Ms. Perlmutter. Yes, well, that is a critical question 
right now. I know--and by the way I am a reformed litigator 
myself. I know there are a number of cases pending in the 
courts asking exactly that question.
    So, assuming that the technology requires the reproduction 
of the works in the computer for purposes of the machine 
learning, there would be a prima facie case of infringement. 
Then the question would be whether it is fair use. Whether it 
is fair use might depend both on how it is used in the training 
and also what the output is going to be and the extent to which 
it competes in the market with the original.
    Mr. Ivey. To what extent is this all going to be reliant on 
I think your term was honesty, I'll say honor code, but, the 
individual who--and I will preface the question with this just 
in my experience, to the extent compensation and the dollars 
get bigger, the honesty and honor code gets sometimes 
marginalized.
    So, you mentioned some of this before, which is the 
certification gets signed and the like. Are there stronger 
enforcement and protections that could be out there for the 
creators of the original content that was ingested by the AI 
model?
    Ms. Perlmutter. Yes, well, the honor issue and the accuracy 
and statements made to the government agency has to do more 
with the applications for registration.
    In terms of litigation, what is interesting is I am seeing 
that more and more some of the companies that are producing and 
distributing AI technology and tools are beginning to say that 
they will license the copyrighted content that they use. Some 
companies that create or license themselves copyrighted content 
are saying that they are now going to create AI using that 
licensed content. So, we may be getting more and more people 
who are interested in making sure that there are no legal 
questions surrounding their use of copyrighted works to train 
the AI.
    Other than that, the way to keep people honest I suppose is 
these lawsuits that are being brought, some of them as class 
actions. We will see what the courts have to say about the 
legality of proceeding without a license.
    Mr. Ivey. Spoken like a true litigator, right.
    Then the last question in relation to that, the CCB I guess 
is sort of an alternative approach. So, instead of going to 
court, they can choose this path, but it is voluntary. I did 
have a question about copyright trolls. Also, on the point you 
just made, to what extent could that be an avenue where these 
sorts of disputes get hashed out in a way that--again, a lot of 
the people who are musicians or writing songs are, oh, jeez, I 
am over my time, I apologize, Mr. Chair, aren't wealthy people.
    Mr. Issa. You are the second last. So, you are only holding 
up my questions. You are good.
    Mr. Ivey. Thank you, Mr. Chair. I appreciate it.
    Their ability to hire litigators can be limited. Is the CCB 
an option or an avenue that might be a viable approach for them 
or not so much?
    Ms. Perlmutter. The CCB would be a possible approach. The 
limitation is that they can't issue injunctions. So, they can't 
order anyone to stop infringing. There is a limit of $30,000 in 
damages.
    So, certainly, the other option and the one that has been 
pursued so far has been bringing cases in Federal court where 
presumably, especially if it is a class action, there are 
lawyers who will get compensated at the end of the day if the 
action is successful.
    So, I have been wondering whether we will start to see many 
cases involving generative AI in the CCB. So, far that has not 
begun to happen.
    Mr. Ivey. Thank you, ma'am. Keep up the good work.
    Thank you, Mr. Chair, for your indulgence.
    Mr. Issa. Thank you. Thank you for your question, because I 
am going to followup directly on that.
    The CCB, as you say, voluntary, $30,000 limit, creation of 
Congress, still in the early stages. However, the gentleman 
from Maryland mentioned the word copyright trolls. We are 
seeing a growth of what many would call copyright trolls, 
people who gather a few earlier words, and even when they are 
dramatically different, they still make the claim. There is a 
high cost in Federal court.
    As you know, your experience in the past at the Patent and 
Trademark Office we created PTAB, and it is an alternate. It 
serves a similar purpose of adjudicating and is appealable to 
the Federal Circuit. It also, though, has a significant role in 
changing, if items end up in the Federal court, how the Federal 
court looks at them, because they give the obvious deference to 
the decision of PTAB.
    Although it is not universally loved here on the dais, in 
this case, if we were to take the model in its infancy of CCB 
but empower it to be a right to go and, in fact, the decisions 
of it be if not substantive enough to be automatically 
considered adjudication, if we considered them to be admissible 
and some deference by the Federal court, would that be in your 
opinion a helpful use and expansion of the role of that?
    The reason I ask it is Federal judges are perplexed trying 
to understand if this piece of a lyric should or shouldn't. 
They generally get one case in a career, where you have 500 
cases in front of you today.
    Ms. Perlmutter. It is an interesting question. I hadn't 
thought about that before. I will say, again, it is early days. 
We have only had one full written decision on the merits so 
far. We do have a very good board with three officers who are 
extremely experienced with litigation on both sides of the 
copyright issues. I have a lot of confidence in the quality of 
the decisions that are going to be issued.
    So, yes, it could be that they could be useful as 
precedent. They certainly would be available to the public to 
look at. I think that is a very important aspect of the CCB.
    Mr. Issa. One of the reasons that I ask that question is 
that I am an old Oversight and Reform Chair. The reforms that 
are probably needed going forward to the institution of 
Congress for which you oversee it really do have to do with how 
the Patent and Trademark Office has been able to set fees, fund 
itself, and expand to serve the very people whose intellectual 
property is being protected. You have not been. You are a much 
smaller entity, in no small part because you depend on Congress 
to fund you.
    So, one of the reforms that I want to put out here today 
during your visit is the idea that we have the ability on this 
Committee to change the structure, to provide for fee setting, 
to provide for a level of autonomy and expansion to meet the 
demands of, in fact, those entities you serve. I want to make 
sure that we make it clear that is something we would like to 
have an ongoing dialog about.
    I will stop you because I don't want to be too long in this 
final one.
    Earlier today we talked about what I call standard 
essential copyright, in other words, copyrights that are put 
into products or even into standards. Would it be helpful for 
Congress to, in fact, as we pretty well define standard 
essential patents as something which does not give up the right 
of the patent holder but gives a requirement to make available, 
even at a fee but still available? Should copyrights that are 
embedded in products, whether it is inside the deep bowels of 
an automobile or the toner cartridge of a photocopier, should 
that, in fact, be something that Congress addresses and 
defines?
    Ms. Perlmutter. I think that is an area where attention 
could be useful. It may be that in the process of putting a 
permanent exemption into Section 1201, which as I have said we 
support, we could look at how to define the scope of that 
exception.
    Mr. Issa. Thank you. Last, copyright is a little different 
than patents in that just because something has been 
copyrighted 100 years ago or 1,000 years ago it doesn't take a 
lot to, in fact, create a new copyright. Would you agree?
    Ms. Perlmutter. Yes.
    Mr. Issa. However, your office and the offices around the 
world today do not maintain a single database so that one can 
at least reference the scope and the prior art, if you will.
    Do you believe that in the 21st century we should establish 
a global copyright database, meaning that all the entities like 
you around the world should, in fact, have an interoperable 
database so that when there is a question of whether something 
is new and original, or simply lifted as the gentlelady from 
Pennsylvania implied as a former professor, in fact, that there 
be an ever-expanding database? For lack of that, is that level 
of trust on the author perhaps a little greater than it should 
be in the 21st century?
    Ms. Perlmutter. There is a lot to unpack in that question. 
So, I would say, first, more data being available to the 
public, including internationally, is definitely a positive 
thing. It is certainly something that people have long 
advocated for in the music space, because it would be very 
useful given the complexity of music licensing to have that 
kind of complete database.
    One question is the extent to which that should be a 
function of government and the extent to which it should be a 
privately run database, which might be a little bit more 
flexible and easy to keep up to date.
    One of the issues with having some kind of international 
government-run database is that, of course, copyright 
registration is not mandatory. Not all works are registered. 
So, by definition, it won't be completely comprehensive. 
Another problem is that many countries around the world don't 
have a registration system. So, we probably have the most 
extensive registration system that exists. So, there are a lot 
of issues to be dealt with.
    Then, of course, it is also the case that, unlike patent 
law, with copyright law the fact that someone else came up with 
something similar in the past doesn't mean that your use is 
infringing. It has to actually be copied from the original. So, 
the mere fact that something was in a database, and you did 
something similar would not necessarily establish infringement. 
So, in a sense, there is less of a need on the copyright side 
than there is in industrial property.
    Mr. Issa. In closing, in discussions with many of the, or 
three of the regenerative AI producers, they all tell me that, 
in fact, providing the metadata that goes with the portion of 
the ingested material, which, if you will, the AI brain used, 
is, in fact, relatively easy if written into the code.
    Should, like Europe, as we address mandates, should, in 
fact, we ensure that this information is written into the code 
so that, in fact, for you and other users that metadata is 
available, and by the way, yes, potentially for litigators?
    Ms. Perlmutter. This is definitely one of the issues we 
heard a lot about in our listening sessions earlier this year 
and something that we are asking about in the NOI. I think 
there is a strong argument that some level of transparency is 
important for many reasons, as you say, including for the 
ability of copyright owners to know that their works were 
incorporated in some way in the machine learning.
    Mr. Issa. Thank you. Last, would you agree to take 
questions for the record if they come to you timely in the next 
week or so?
    Ms. Perlmutter. I would be happy to. Thank you.
    Mr. Issa. Thank you.
    With that, this concludes today's hearing. I want to thank 
our witnesses for appearing before the Committee.
    Without objection, all Members will have five legislative 
days to submit additional written questions for the witness and 
additional materials for the record.
    Without objection, this hearing is adjourned.
    [Whereupon, at 11:53 a.m., the Subcommittee was adjourned.]

    All materials submitted for the record by Members of the 
Subcommittee on Courts, Intellectual Property, and the Internet 
can
be found at: https://docs.house.gov/Committee/Calendar/ByEvent 
.aspx?EventID=116404.

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