[Congressional Record Volume 143, Number 147 (Tuesday, October 28, 1997)]
[Senate]
[Pages S11301-S11302]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         ADDITIONAL STATEMENTS

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                          PASSAGE OF H.R. 672

 Mr. HATCH. Mr. President, I rise today to laud the Senate 
passage of H.R. 672. This legislation, which was introduced by 
Congressman Coble in the House of Representatives, is the counterpart 
to legislation I introduced in the Senate on March 20 of this year--the 
Copyright Clarification Act of 1997 (S. 506). The Copyright 
Clarification Act was reported unanimously by the Senate Judiciary 
Committee on April 17.
  The purpose of these bills is to make technical but needed changes to 
our Nation's copyright laws in order to ensure the effective 
administration of our copyright system and the U.S. Copyright Office. 
The need for these changes was first brought to my attention by the 
Register of Copyrights, Marybeth Peters, and I want to thank her for 
her outstanding work.
  Among the most important amendments made by H.R. 672 is a 
clarification of the Copyright Office's authority to increase its fees 
for the first time since 1990 in order to help cover its costs and to 
reduce the impact of its services on the Federal budget and the 
American taxpayer. This clarification is needed because of ambiguities 
in the Copyright Fees and Technical Amendments Act of 1989, which 
authorized the Copyright Office to increase fees in 1995, and every 
fifth year thereafter. Because the Copyright Office did not raise its 
fees in 1995, as anticipated, there has been some uncertainty as to 
whether the Copyright Office may increase its fees again before 2000 
and whether the baseline for calculating the increase in the consumer 
price index is the date of the last actual fee settlement, 1990, or the 
date of the last authorized fee settlement, 1995. H.R. 672 clarifies 
that the Copyright Office may increase its fees in any calendar year, 
provided it has not done so within the last 5 years, and that the fees 
may be increased up to the amount required to cover the reasonable 
costs incurred by the Copyright Office.
  Although H.R. 672 does not require the Copyright Office to increase 
its fees to cover all its costs, I believe it is important in that it 
provides the Copyright Office the statutory tools to become self-
sustaining--a concept that I promoted in the last Congress. Currently 
the Copyright Office does not recover the full cost of its services 
through fees, but instead receives some $10 million in annual 
appropriations.
  Several studies have supported full-cost recovery for the Copyright 
Office. For example, A 1996 Booz-Allen and Hamilton management review 
of the Library of Congress recommended that the Copyright Office pursue 
full-cost recovery, noting that the Copyright Office has been subject 
to full-cost recovery in the past and that the potential revenues to be 
derived from pursuing a fee-based service was significant. A 1996 
internal Copyright Office management report prepared by the Library of 
Congress also recommended full-cost recovery for copyright services. 
The Congressional Budget Office has also suggested full-cost recovery 
for the Copyright Office as a means of achieving deficit reduction. 
These recommendations were endorsed by the General Accounting Office in 
its recent report, Intellectual Property, Fees Are Not Always 
Commensurate with the Costs of Service.

  It is my understanding that the Copyright Office has embraced the 
goal of achieving full-cost recovery for its copyright services. H.R. 
672 will provide the authority to achieve that goal, and by passing 
this legislation this year, the Copyright Office will be able to move 
expeditiously to adjust their fees for the coming year.
  I also want to note the importance of the amendment which the Senate 
has adopted to H.R. 672 to overturn the Ninth Circuit's decision in La 
Cienega Music Co. v. ZZ Top, 53 F.3d 950 (9th Cir. 1995), cert denied, 
116 S. Ct. 331 (1995). My colleagues will recall that Senator Leahy and 
I introduced this legislation in March of this year as a provision of 
S. 505, the Copyright Term Extension Act of 1997.
  In general, La Cienega held that distributing a sound recording to 
the public--by sale, for example--is a publication of the music 
recorded on it under the 1909 Copyright Act. Under the 1909 act, 
publication without copyright notice caused loss of copyright 
protection. Almost all music that was first published on recordings did 
not contain copyright notice, because publishers believed that it was 
not technically a publication. The Copyright Office also considered 
these musical compositions to be unpublished. The effect of La Cienega, 
however, is that virtually all music before 1978 that was first 
distributed to the public on recordings has no copyright protection--at 
least in the Ninth Circuit.
  By contrast, the Second Circuit in Rosette v. Rainbo Record 
Manufacturing Corp., 546 F.2d 461 (2d Cir. 1975), aff'd per curiam, 546 
F.2d 461 (2d Cir. 1976) has held the opposite--that publish 
distribution of recordings was not a publication of the music contained 
on them. As I have noted, Rosette comports with the nearly universal 
understanding of the music and sound recording industries and of the 
Copyright Office.
  Since the Supreme Court has denied cert in La Cienega, whether one 
has copyright in thousands of musical compositions depends on whether 
the case is brought in the Second or Ninth Circuits. This situation is 
intolerable. Overturning the La Cienega decision will restore national 
uniformity on this important issue by confirming the wisdom of the 
custom and usage of the affected industries and of the Copyright Office 
for nearly 100 years.
  In addition to these two important provisions, H.R. 672 will: First, 
correct drafting errors in the Satellite Home Viewer Act of 1994, which 
resulted from the failure to take into account the recent changes made 
by the Copyright Tribunal Reform Act of 1993, and which mistakingly 
reversed the rates set by a 1992 Copyright Arbitration Royalty Panel 
for satellite carriers; second, clarify ambiguities in the Copyright 
Restoration Act dealing with the restoration of copyright protection 
for certain works under the 1994 Uruguay Round Agreements Act; third, 
ensure that rates established in 1996 under the Digital Performance 
Rights in Sound Recordings Act will not lapse in the event that the 
Copyright Arbitration Royalty Panel does not conclude rate-setting 
proceedings prior to December

[[Page S11302]]

1, 2000; fourth, restore definitions of jukebox and jukebox operator, 
which were mistakingly omitted when the old jukebox compulsory license 
was replaced with the current negotiated jukebox license; fifth, revise 
the currently unworkable requirement of a 10-day advanced notice of 
intent to copyright the fixation of live performances, such as sporting 
events; sixth, clarify administrative issues regarding the operation of 
the Copyright Arbitration Royalty Panels; seventh, provide needed 
flexibility for the Librarian of Congress in setting the negotiation 
period for the distribution of digital audio recording technology 
[DART] royalties; and, eighth, make miscellaneous spelling, 
grammatical, capitalization, and other corrections to the Copyright 
Act.
  Mr. President, this is important legislation, and I am pleased the 
Senate has acted to approve it prior to adjourning this fall. I wish to 
thank my colleagues and to encourage the House to accept the Senate 
amendment and to forward H.R. 672 to the President for his signature 
without delay.

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