[Congressional Record (Bound Edition), Volume 150 (2004), Part 11]
[Senate]
[Pages 14136-14140]
[From the U.S. Government Publishing Office, www.gpo.gov]




            ARTISTS' RIGHTS AND THEFT PREVENTION ACT OF 2004

  Mr. FRIST. I ask unanimous consent that the Senate now proceed to the 
immediate consideration of Calendar No. 482, S. 1932.
  The PRESIDING OFFICER. The clerk will report the bill by title.
  The legislative clerk read as follows:

       A bill (S. 1932) to provide criminal penalties for 
     unauthorized recording of motion pictures in a motion picture 
     exhibit facility, to provide criminal and civil penalties for 
     unauthorized distribution of commercial prerelease 
     copyrighted works, and for other purposes.

  There being no objection, the Senate proceeded to consider the bill, 
which had been reported from the Committee on the Judiciary with an 
amendment to strike all after the enacting clause and insert in lieu 
thereof the following:
  (Strike the part shown in black brackets and insert the part shown in 
italic.)

                                S. 1932

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

     [SECTION 1. SHORT TITLE.

       [This Act may be cited as the ``Artists' Rights and Theft 
     Prevention Act of 2003'' or the ``ART Act''.

     [SEC. 2. CONGRESSIONAL FINDINGS.

       [Congress finds the following:
       [(1) Intellectual property, among other things, represents 
     the ideas, imagination and creativity needed to innovate long 
     before a product is brought to market. As such, it is 
     fundamental to the continued economic, social, and cultural 
     development of society and deserves the protection of our 
     laws.
       [(2) Music, film, software, and all forms of intellectual 
     property represent one of the strongest and most significant 
     sectors of the United States economy, as demonstrated by the 
     fact that these industries
       [(A) accounted for more than 5 percent of the United States 
     Gross Domestic Product (GDP), or $535,100,000,000 in 2001;
       [(B) employ almost 6 percent of all United States 
     employment; and
       [(C) led all major industry sectors in foreign sales and 
     exports in 2001.
       [(3) In an attempt to combat the growing use of the 
     Internet and technology for the illegal reproduction and 
     distribution of copyrighted materials, Congress unanimously 
     passed and President Clinton signed the ``No Electronic 
     Theft'' or ``NET'' Act in 1997. The NET Act is designed to 
     strengthen copyright and trademark laws and to permit the 
     prosecution of individuals in cases involving large scale 
     illegal reproduction or distribution of copyrighted works 
     where the infringers act willfully.
       [(4) Under the NET Act's requirement of economic harm, 
     investigations by law enforcement of copyright infringements 
     are particularly resource intensive and pose significant 
     challenges. In the interest of broader deterrence and in 
     order to facilitate the prosecution of particularly egregious 
     copyright violations, it is important to recognize that a 
     significant level of economic harm can be reached by the 
     distribution of so called ``prelease'' commercial works.
       [(5) The use of camcorders and other audiovisual recording 
     devices in movie theaters to make illegal copies of films is 
     posing a serious threat to the motion picture industry. 
     According to a recent industry study, 92.4 percent of the 
     first copies of movies available for download on the Internet 
     originate from camcorders.
       [(6) Given the difficulty of enforcement, online theft of 
     music, film, software, and all forms of intellectual property 
     continues to rise. The negative effects on this large segment 
     of the United States economy are significant, as exemplified 
     by almost a 31 percent drop in sales for the music industry

[[Page 14137]]

     from mid-year 2000 to mid-year 2003, which even critics of 
     the industry acknowledge to be heavily influenced by the 
     rampant distribution of pirated music.
       [(7) Federal legislation is necessary and warranted to 
     combat the most egregious forms of online theft of 
     intellectual property and its significant, negative economic 
     impact on the United States economy because
       [(A) Article 1, section 8 of the Constitution confers upon 
     Congress the power ``[t]o promote the Progress of Science and 
     useful Arts, by securing for limited Times to Authors and 
     Inventors the exclusive Right to their respective Writings 
     and Discoveries,'' as well as the power ``[t]o regulate 
     Commerce with foreign nations, and among the several 
     States.'';
       [(B) the importance of the music, film, software and other 
     intellectual property-based industries to the overall health 
     of the United States economy is well documented and 
     significant; and
       [(C) theft and distribution of intellectual property across 
     State and international lines occurs on a regular basis.

     [SEC. 3. CRIMINAL PENALTIES FOR UNAUTHORIZED RECORDING OF 
                   MOTION PICTURES IN A MOTION PICTURE EXHIBITION 
                   FACILITY.

       [(a) In General.--Chapter 13 of title 18, United States 
     Code, is amended by adding after section 2319A the following 
     new section:

     [``Sec. 2319B. UNAUTHORIZED RECORDING OF MOTION PICTURES IN A 
                   MOTION PICTURE EXHIBITION FACILITY

       [``(a) Offense.--Whoever, without the consent of the 
     copyright owner, knowingly uses or attempts to use an 
     audiovisual recording device in a motion picture exhibition 
     facility to transmit or make a copy of a motion picture or 
     other audiovisual work protected under title 17, United 
     States Code, or any part thereof, in a motion picture 
     exhibition facility shall--
       [``(1) be imprisoned for not more than 3 years, fined under 
     this title, or both; or
       [``(2) if the offense is a second or subsequent offense, be 
     imprisoned for no more than 6 years, fined under this title, 
     or both.
       [``(b) Forfeiture and Destruction.--When a person is 
     convicted of a violation of subsection (a), the court in its 
     judgment of conviction shall, in addition to any penalty 
     provided, order the forfeiture and destruction or other 
     disposition of all unauthorized copies of motion pictures or 
     other audiovisual works protected under title 17, United 
     States Code, or parts thereof, and any audiovisual recording 
     devices or other equipment used in connection with the 
     offense.
       [``(c) Authorized Activities.--This section does not 
     prevent any lawfully authorized investigative; protective, or 
     intelligence activity by an officer, agent, or employee of 
     the United States, a State, or a political subdivision of a 
     State, or a person acting pursuant to a contract with the 
     United States, a State, or a political subdivision of a 
     State.
       [``(d) Victim Impact Statement.--
       [``(1) In general.--During the preparation of the 
     presentence report pursuant to rule 32(c) of the Federal 
     Rules of Criminal Procedure, victims of an offense under this 
     section shall be permitted to submit to the probation officer 
     a victim impact statement that identifies the victim of the 
     offense and the extent and scope of the injury and loss 
     suffered by the victim, including the estimated economic 
     impact of the offense on that victim.
       [``(2) Contents.--A victim impact statement submitted under 
     this subsection shall include--
       [``(A) producers and sellers of legitimate works affected 
     by conduct involved in the offense;
       [``(B) holders of intellectual property rights in the works 
     described in subparagraph (A); and
       [``(C) the legal representatives of such producers, 
     sellers, and holders.
       [``(e) Definitions.--As used in this section, the following 
     definitions shall apply:
       [``(1) Audiovisual work, copy, and motion picture.--The 
     terms `audiovisual work', `copy', and `motion picture' have, 
     respectively, the meanings given those terms in section 101 
     of title 17, United States Code.
       [``(2) Audiovisual recording device.--The term `audiovisual 
     recording device' means a digital or analog photographic or 
     video camera, or any other technology capable of enabling the 
     recording or transmission of a copyrighted motion picture or 
     other audiovisual work, or any part thereof, regardless of 
     whether audiovisual recording is the sole or primary purpose 
     of the device.
       [``(3) Motion picture exhibition facility.--The term 
     `motion picture exhibition facility' means any theater, 
     screening room, lobby, indoor or outdoor screening venue, 
     ballroom, or other premises where copyrighted motion pictures 
     or other audiovisual works are publicly exhibited, regardless 
     of whether an admission fee is charges.''.
       [(b) Chapter Analysis.--The chapter analysis for chapter 
     113 of title 18, United States Code, is amended by inserting 
     after the item relating to section 2319A the following:

[``2319B. Unauthorized recording of motion pictures in a motion picture 
              exhibition facility.''.

     [SEC. 4. CRIMINAL INFRINGEMENT OF A COMMERCIAL PRERELEASE 
                   COPYRIGHTED WORK.

       [Section 2319 of title 18, United States Code, is amended--
       [(1) by redesignating subsection (e) as subsection (f); and
       [(2) by adding after subsection (d) the following:
       [``(e)(1) For purposes of subsections (b) and (c) of this 
     section and of section 506(a) of title 17, United States 
     Code, in the case of a computer program, a nondramatic 
     musical work, a motion picture or other audio-visual work, or 
     a sound recording protected under title 17, United States 
     Code, that is being prepared for commercial distribution, it 
     shall be conclusively presumed that a person distributed at 
     least 10 copies or phonorecords of the work, and that such 
     copies or phonorecords have a total retail value of more than 
     $2,500, if that person--
       [``(A) distributes such work by making it available on a 
     computer network accessible to members of the public who are 
     able to reproduce the work through such access without the 
     express consent of the copyright owner; and
       [``(B) knew or should have known that the work was intended 
     for commercial distribution.
       [``(2) For purposes of paragraph (1), a work protected 
     under title 17, United States Code, is being prepared for 
     commercial distribution--
       [``(A) when at the time of unauthorized distribution, the 
     copyright owner had a reasonable expectation of substantial 
     commercial distribution and the work had not yet been so 
     distributed; or
       [``(B) in the case of a motion picture, protected under 
     title 17, United States Code, when at the time of 
     unauthorized distribution, the work had been made available 
     for viewing in motion picture exhibition facilities, but had 
     not been made available to the general public in the United 
     States in a format intended to permit viewing outside motion 
     picture exhibition facilities as defined in section 2319B.''.

     [SEC. 5. CIVIL REMEDIES FOR INFRINGEMENT OF A COMMERCIAL 
                   PRERELEASE COPYRIGHTED WORK.

       [Section 504(b) of title 17, United States Code, is 
     amended--
       [(1) by striking the first instance of ``The copyright'' 
     and inserting the following:
       [``(1) In general. The copyright''; and (2) by adding at 
     the end the following:
       [``(2) Damage for prerelease infringement.--
       [``(A) In general. In the case of a computer program, a 
     non-dramatic musical work, a motion picture or other 
     audiovisual work, or a sound recording protected under title 
     17, United States Code, that is being prepared for commercial 
     distribution, actual damages shall be presumed conclusively 
     to be no less that $2,500 per infringement, if a person--
       [``(i) distributes such work by making it available on a 
     computer network accessible to members of the public who are 
     able to reproduce the work through such access without the 
     express consent of the copyright owner; and
       [``(ii) knew or should have known that the work was 
     intended for commercial distribution.
       [``(B) Work prepared for distribution. For purposes of 
     subparagraph (A), a work protected under this title is being 
     prepared for commercial distribution--
       [``(i) when at the time of unauthorized distribution, the 
     copyright owner had a reasonable expectation of substantial 
     commercial distribution and the work had not yet been so 
     distributed; or
       [``(ii) in the case of a motion picture, protected under 
     this title, when at the time of unauthorized distribution, 
     the work had been made available for viewing in motion 
     picture exhibition facilities, but had not been made 
     available to the general public in the United States in a 
     format intended to permit viewing outside motion picture 
     exhibition facilities as defined in section 2319B of title 
     18.''.

     SEC. 6. SENTENCING GUIDELINES.

       [(a) In General. Not later than 180 days after the date of 
     enactment of this Act, the United States Sentencing 
     Commission shall--
       [(1) review the Federal sentencing guidelines with respect 
     to offenses involving the illegal reproduction and 
     distribution of copyrighted works in violation of Federal 
     law, including violations of section 2319 and section 2319B 
     of title 18, United States Code;
       [(2) amend the Federal sentencing guidelines, as necessary, 
     to provide for increased penalties for offenses involving the 
     illegal reproduction and distribution of works protected 
     under title 17, United States Code, in a manner that reflects 
     the serious nature of, and need to deter, such offenses;
       [(3) submit a report to Congress that details its findings 
     and amendments; and
       [(4) take such other action that the Commission considers 
     necessary to carry out this Act.
       [(b) Consultation.--In carrying out this section, the 
     United States Sentencing Commission shall seek input from the 
     Department of Justice, copyright owners, and other interested 
     parties.

     [SEC. 7. AUTHORIZATION.

       [There is authorized to be appropriated to the Department 
     of Justice an additional

[[Page 14138]]

     $5,000,000 for each of fiscal years 2005, 2006, 2007, 2008, 
     and 2009 to prosecute violations of section 2319 of title 18, 
     United States Code.]
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Artists' Rights and Theft 
     Prevention Act of 2004'' or the ``ART Act''.

     SEC. 2. CONGRESSIONAL FINDINGS.

       Congress finds the following:
       (1) Intellectual property--
       (A) represents the ideas, imagination and creativity needed 
     to innovate long before a product is brought to market;
       (B) is fundamental to the continued economic, social, and 
     cultural development of society; and
       (C) deserves the protection of our laws.
       (2) Music, film, software, and all other forms of 
     intellectual property represent one of the strongest and most 
     significant sectors of the United States economy, as 
     demonstrated by the fact that these industries--
       (A) accounted for more than 5 percent of the United States 
     Gross Domestic Product, or $535,100,000,000 in 2001;
       (B) represent almost 6 percent of all United States 
     employment; and
       (C) led all major industry sectors in foreign sales and 
     exports in 2001.
       (3) In an attempt to combat the growing use of the Internet 
     and technology for the illegal reproduction and distribution 
     of copyrighted materials, Congress unanimously passed and 
     President Clinton signed the ``No Electronic Theft (NET) 
     Act'' in 1997. The NET Act is designed to strengthen 
     copyright and trademark laws and to permit the prosecution of 
     individuals in cases involving large-scale illegal 
     reproduction or distribution of copyrighted works where the 
     infringers act willfully.
       (4) Under the No Electronic Theft (NET) Act's economic harm 
     requirement, investigations by law enforcement of copyright 
     infringements are particularly resource intensive and pose 
     significant challenges. In the interest of broader deterrence 
     and in order to facilitate the prosecution of particularly 
     egregious copyright violations, it is important to recognize 
     that a significant level of economic harm can be reached by 
     the distribution of prerelease commercial works.
       (5) The use of camcorders and other audiovisual recording 
     devices in movie theaters to make illegal copies of films is 
     posing a serious threat to the motion picture industry. 
     According to a recent industry study, 92.4 percent of the 
     first copies of movies available for download on the Internet 
     originate from camcorders.
       (6) Given the difficulty of enforcement, online theft of 
     music, film, software, and all forms of intellectual property 
     continues to rise. The negative effects on this large segment 
     of the United States economy are significant, as exemplified 
     by almost a 31 percent drop in sales for the music industry 
     from the middle of 2000 to the middle of 2003.
       (7) Federal legislation is necessary and warranted to 
     combat the most egregious forms of online theft of 
     intellectual property and its significant, negative economic 
     impact on the United States economy because--
       (A) Article 1, section 8 of the United States Constitution 
     gives Congress the power ``[t]o promote the Progress of 
     Science and useful Arts, by securing for limited Times to 
     Authors and Inventors the exclusive Right to their respective 
     Writings and Discoveries,'' as well as the power ``[t]o 
     regulate Commerce with foreign nations, and among the several 
     States.'';
       (B) the importance of the music, film, software and other 
     intellectual property-based industries to the overall health 
     of the United States economy is well documented and 
     significant; and
       (C) theft and unauthorized distribution of intellectual 
     property across State and international lines occurs on a 
     regular basis.

     SEC. 3. CRIMINAL PENALTIES FOR UNAUTHORIZED RECORDING OF 
                   MOTION PICTURES IN A MOTION PICTURE EXHIBITION 
                   FACILITY.

       (a) In General.--Chapter 113 of title 18, United States 
     Code, is amended by adding after section 2319A the following 
     new section:

     ``Sec. 2319B. Unauthorized recording of motion pictures in a 
       motion picture exhibition facility

       ``(a) Offense.--Any person who, without the authorization 
     of the copyright owner, knowingly uses or attempts to use an 
     audiovisual recording device to transmit or make a copy of a 
     motion picture or other audiovisual work protected under 
     title 17, or any part thereof, from a performance of such 
     work in a motion picture exhibition facility, shall--
       ``(1) be imprisoned for not more than 3 years, fined under 
     this title, or both; or
       ``(2) if the offense is a second or subsequent offense, be 
     imprisoned for no more than 6 years, fined under this title, 
     or both.
       ``(b) Forfeiture and Destruction.--When a person is 
     convicted of a violation of subsection (a), the court in its 
     judgment of conviction shall, in addition to any penalty 
     provided, order the forfeiture and destruction or other 
     disposition of all unauthorized copies of motion pictures or 
     other audiovisual works protected under title 17, or parts 
     thereof, and any audiovisual recording devices or other 
     equipment used in connection with the offense.
       ``(c) Authorized Activities.--This section does not prevent 
     any lawfully authorized investigative, protective, or 
     intelligence activity by an officer, agent, or employee of 
     the United States, a State, or a political subdivision of a 
     State, or a person acting under a contract with the United 
     States, a State, or a political subdivision of a State.
       ``(d) Immunity for Theaters.--With reasonable cause, the 
     owner or lessee of a facility where a motion picture is being 
     exhibited, the authorized agent or employee of such owner or 
     lessee, the licensor of the motion picture being exhibited, 
     or the agent or employee of such licensor--
       ``(1) may detain, in a reasonable manner and for a 
     reasonable time, any person suspected of a violation of this 
     section for the purpose of questioning or summoning a law 
     enforcement officer; and
       ``(2) shall not be held liable in any civil or criminal 
     action arising out of a detention under paragraph (1).
       ``(e) Victim Impact Statement.--
       ``(1) In general.--During the preparation of the 
     presentence report under rule 32(c) of the Federal Rules of 
     Criminal Procedure, victims of an offense under this section 
     shall permitted to submit to the probation officer a victim 
     impact statement that identifies the victim of the offense 
     and the extent and scope of the injury and loss suffered by 
     the victim, including the estimated economic impact of the 
     offense on that victim.
       ``(2) Contents.--A victim impact statement submitted under 
     this subsection shall include--
       ``(A) producers and sellers of legitimate works affected by 
     conduct involved in the offense;
       ``(B) holders of intellectual property rights in the works 
     described in subparagraph (A); and
       ``(C) the legal representatives of such producers, sellers, 
     and holders.
       ``(f) Definitions.--In this section, the following 
     definitions shall apply:
       ``(1) Title 17 definitions.--The terms `audio-visual work', 
     `copy', `copyright owner', `motion picture', `motion picture 
     exhibition facility', and `transmit' have, respectively, the 
     meanings given those terms in sections 101 of title 17.
       ``(2) Audiovisual recording device.--The term `audiovisual 
     recording device' means a digital or analog photographic or 
     video camera, or any other technology or device capable of 
     enabling the recording or transmission of a copyrighted 
     motion picture or other audiovisual work, or any part 
     thereof, regardless of whether audiovisual recording is the 
     sole or primary purpose of the device.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 113 of title 18, United States Code, is 
     amended by inserting after the item relating to section 2319A 
     the following:

``2319B. Unauthorized recording of motion pictures in a motion picture 
              exhibition facility.''.

       ``(c) Definition.--Section 101 of title 17, United States 
     Code, is amended by inserting after the definition of 
     ``Motion pictures'' the following:
       ``The term `motion picture exhibition facility' means a 
     movie theater, screening room, or other venue that is being 
     used primarily for the exhibition of a copyrighted motion 
     picture, if such exhibition is open to the public or is made 
     to an assembled group of viewers outside of a normal circle 
     of a family and its social acquaintances.''.

     SEC. 4. CRIMINAL INFRINGEMENT OF A WORK BEING PREPARED FOR 
                   COMMERCIAL DISTRIBUTION.

       (a) Prohibited Acts.--Seciton 506(a) of title 17, United 
     States Code, is amended to read as follows:
       ``(a) Criminal Infringement.--
       ``(1) In general.--Any person who willfully infringes a 
     copyright shall be punished as provided under section 2319 of 
     title 18, if the infringement was committed--
       ``(A) for purposes of commercial advantage or private 
     financial gain;
       ``(B) by the reproduction or distribution, including by 
     electronic means, during any 180-day period, of 1 or more 
     copies or phonorecords of 1 or more copyrighted works, which 
     have a total retail value of more than $1,000; or
       ``(C) by the distribution of a work being prepared for 
     commercial distribution, by making it available on a computer 
     network accessible to members of the public if such person 
     knew or should have known that the work was intended for 
     commercial distribution.
       ``(2) Evidence.--For purposes of this subsection, evidence 
     of reproduction or distribution of a copyrighted work, by 
     itself, shall not be sufficient to establish willful 
     infringement of a copyright.
       ``(3) Definition.--In this subsection, the term `work being 
     prepared for commercial distribution' means--
       ``(A) a computer program, a musical work, a motion picture 
     or other audiovisual work, or a sound recording, if at the 
     time of unauthorized distribution--
       ``(i) the copyright owner has a reasonable expectation of 
     commercial distribution; and
       ``(ii) the copies or phonorecords of the work have not been 
     commercially distributed; or
       ``(B) a motion picture, if at the time of unauthorized 
     distribution, the motion picture--
       ``(i) has been made available for viewing in a motion 
     picture exhibition facility; and
       ``(ii) has not been made available in copies for sale to 
     the general public in the United States in a format intended 
     to permit viewing outside a motion picture exhibition 
     facility.''.
       (b) Criminal Penalties.--Section 2319 of title 18, United 
     States Code, is amended--
       (1) in subsection (a)--
       (A) by striking ``Whoever'' and inserting ``Any person 
     who''; and
       (B) by striking ``and (c) of this section'' and inserting 
     ``, (c), and (d)'';
       (2) in subsection (b), by striking ``section 506(a)(1)'' 
     and inserting ``section 506(a)(1)(A);
       (3) in subsection (c), by striking ``section 506(a)(2) of 
     title 17, United States Code'' and inserting ``section 
     506(a)(1)(B) of title 17'';

[[Page 14139]]

       (4) by redesignating subsections (d) and (e) as subsections 
     (e) and (f), respectively;
       (5) by adding after subsection (c) the following:
       ``(d) Any person who commits an offense under section 
     506(a)(1)(C) of title 17--
       ``(1) shall be imprisoned not more than 3 years, fined 
     under this title or both;
       ``(2) shall be imprisoned not more than 5 years, fined 
     under this title, or both, if the offense was committed for 
     purposes of commercial advantage or private financial gain;
       ``(3) shall be imprisoned not more than 6 years, fined 
     under this title, or both, if the offense is a second or 
     subsequent offense; and
       ``(4) shall be imprisoned not more than 10 years, fined 
     under this title, or both, if the offense is a second or 
     subsequent offense under paragraph (2).''; and
       (6) in subsection (f), as redesignated--
       (A) in paragraph (1), by striking ``and'' at the end;
       (B) in paragraph (2), by striking the period at the end and 
     inserting a semicolon; and
       (C) by adding at the end the following:
       ``(3) the term `financial gain' has the meaning given the 
     term in section 101 of the title 17; and
       ``(4) the term `work being prepared for commercial 
     distribution' has the meaning given the term in section 
     506(a) of title 17.''.

     SEC. 5. CIVIL REMEDIES FOR INFRINGEMENT OF A WORK BEING 
                   PREPARED FOR COMMERCIAL DISTRIBUTION.

       (a) Preregistration.--Section 408 of title 17, United 
     States Code, is amended by adding at the end the following:
       ``(f) Preregistration of Works Being Prepared for 
     Commercial Distribution.--
       ``(1) Rulemaking.--Not later than 180 days after the date 
     of enactment of this Act, the Register of Copyrights shall 
     issue regulations to establish procedures for preregistration 
     of a work that is being prepared for commercial distribution 
     and has not been published.
       ``(2) Class of works.--The regulations established under 
     paragraph (1) shall permit preregistration for any work that 
     is in a class of works that the Register determines has had a 
     history of infringement prior to authorized commercial 
     distribution.
       ``(3) Application for registration.--Not later than 3 
     months after the first publication of the work, the applicant 
     shall submit to the Copyright Office--
       ``(A) an application for registration of the work;
       ``(B) a deposit; and
       ``(C) the applicable fee.
       ``(4) Effect of Untimely Application.--An action for 
     infringement under this chapter shall be dismissed, and no 
     award of statutory damages or attorney fees shall be made for 
     a preregistered work, if the items described in paragraph 3 
     are not submitted to the Copyright Office in proper form 
     within the earlier of--
       ``(A) 3 months after the first publication of the work; or
       ``(B) 1 month after the copyright owner has learned of the 
     infringement.''.
       (b) Infringement Actions.--Section 411(a) of title 17, 
     United States Code, is amended by inserting ``preregistration 
     or'' after ``shall be instituted until''.
       (c) Exclusion.--Section 412 of title 17, United States 
     Code, is amended by inserting ``, an action for infringement 
     of the copyright of a work that has been preregistered under 
     section 408(f) before the commencement of the infringement'' 
     after ``section 106A(a)''.

     SEC. 6. FEDERAL SENTENCING GUIDELINES.

       (a) Review and Amendment.--Not later than 180 days after 
     the date of enactment of this Act, the United States 
     Sentencing Commission, pursuant to its authority under 
     section 994 of title 28, United States Code, and in 
     accordance with this section, shall review and, if 
     appropriate, amend the Federal sentencing guidelines and 
     policy statements applicable to persons convicted of 
     intellectual property rights crimes, including any offense 
     under--
       (1) section 506, 1201, or 1202 of title 17, United States 
     Code; or
       (2) section 2318, 2319, 2319A, 2319B, or 2320 of title 18, 
     United States Code.
       (b) Authorization.--The United States Sentencing Commission 
     may amend the Federal sentencing guidelines in accordance 
     with the procedures set forth in section 21(a) of the 
     Sentencing Act of 1987 (28 U.S.C. 994 note) as though the 
     authority under that section had not expired.
       (c) Responsibilities of United States Sentencing 
     Commission.--In carrying out this subsection, the United 
     States Sentencing Commission shall--
       (1) take all appropriate measures to ensure that the 
     Federal sentencing guidelines and policy statements described 
     in subsection (a) are sufficiently stringent to deter, and 
     adequately reflect the nature of, intellectual property 
     rights crimes;
       (2) determine whether to provide a sentencing enhancement 
     for those convicted of the offenses described in subsection 
     (a), if the conduct involves the display, performance, 
     publication, reproduction, or distribution of a copyrighted 
     work before it has been authorized by the copyright owner, 
     whether in the media format used by the infringing party or 
     in any other media format;
       (3) determine whether the scope of ``uploading'' set forth 
     in application note 3 of section 2B5.3 of the Federal 
     sentencing guidelines is adequate to address the loss 
     attributable to people who broadly distribute copyrighted 
     works without authorization over the Internet; and
       (4) determine whether the sentencing guidelines and policy 
     statements applicable to the offenses described in subsection 
     (a) adequately reflect any harm to victims from copyright 
     infringement if law enforcement authorities cannot determine 
     how many times copyright material has been reproduced or 
     distributed.

     SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appointed to the Department of 
     Justice $5,000,000 for each of the fiscal years 2005, 2006, 
     2007, 2008, and 2009 to prosecute violations of intellectual 
     property rights as set forth under sections 2318, 2319, 
     2319A, 2319B, and 2320 of title 18, United States Code.

  Mr. LEAHY. Madam President, I am glad that the Senate can today pass 
the ART Act, a piece of legislation that will help protect America's 
movies from a form of piracy that has become all too prevalent. This 
legislation will provide law enforcement with another important tool in 
fighting the harms wreaked by intellectual property theft, which robs 
our innovators--not to mention all those working behind the scenes--of 
compensation owed to them for producing films that carry American 
culture around the globe. The Motion Picture Association of America 
estimates that the movie industry loses $3 billion worldwide to piracy 
each and every year.
  Too often, we think of movie piracy as a disease whose symptoms are 
manifest only in foreign territories. While it is true that much of the 
movie industry's losses occur due to lax intellectual property 
enforcement in countries where the authorities are either ill-equipped 
or disinclined to enforce creators' rights, there is much we can do in 
this country to get our own IP house in order.
  I appreciate that Senator Hatch, Senator Feinstein, and Senator 
Cornyn have been so willing to address my concerns that the bill as 
introduced might inadvertently have a negative impact on the TEACH Act. 
In the 107th Congress, Senator Hatch and I worked to pass the TEACH 
Act, which ensured that educators could use limited portions of 
dramatic literary and musical works, audiovisual works, and sound 
recordings, in addition to the complete versions of non-dramatic 
literary and musical works that were already permitted, and that they 
could use the Internet to do so.
  I also appreciate my colleagues' willingness to eliminate the 
presumptions in the criminal liability provisions, and to take up the 
Copyright Office's creative ideas for addressing pre-release works.
  Were it not for their willingness to address these concerns, I would 
not have been able to offer my support for this bill. I thank my 
colleagues for their assurances as well as for their hard work in 
gaining passage of this important legislation.


                               SECTION 3

  Mr. HATCH. Mr. President, Section 3 of the ART Act establishes a new 
provision of Title 18 entitled. ``Unauthorized Recording of Motion 
Pictures in a Motion Picture Exhibition Facility.'' I ask Senator 
Cornyn, what is the purpose of this provision?
  Mr. CORNYN. Section 3 addresses a serious piracy issue facing the 
movie business: the use of camcorders in a motion picture theater. Sad 
to say there are people who go to the movie theater, generally during 
pre-opening ``screenings'' or during the first weekend of theatrical 
release, and using sophisticated digital equipment, record the movie. 
They're not trying to save $8.00 so they can see the movie again. 
Instead, they sell the camcorded version to a local production factory 
or to an overseas producer, where it is converted into DVDs or similar 
products and sold on the street for a few dollars per copy. This misuse 
of camcorders is a significant factor in the estimated $3.5 billion per 
year of losses the movie industry suffers because of hard goods piracy. 
Even worse, these camcorded versions are posted on the Internet through 
``P2P'' networks such as KaZaa, Grockster and Morpheus--and made 
available for millions to download. The goal of our bill is to provide 
a potent weapon in the arsenal of prosecutors to stem the piracy of 
commercially valuable motion pictures at its source.
  Mr. HATCH. I have heard it said that this bill could be used against 
a salesperson or a customer at stores such as

[[Page 14140]]

Best Buy or Circuit City if he or she were to point a video camera at a 
television screen showing a movie. Is this cause for concern?
  Mr. CORNYN. Absolutely not. The offense is only applicable to 
transmitting or copying a movie in a motion picture exhibition 
facility, which has to be a movie theater or similar venue ``that is 
being used primarily for the exhibition of a copyrighted motion 
picture.'' In the example of Best Buy--the store is being used 
primarily to sell electronic equipment, not to exhibit motion pictures. 
For the same reason, the statute would not cover a university student 
who records a short segment of a film being shown in film class, as the 
venue is being used primarily as a classroom, and not as a movie 
theater.
  Mr. HATCH. Does the Senator from California agree with our colleague 
from Texas?
  Mrs. FEINSTEIN. Absolutely, on all points.
  Mr. HATCH. I have also heard some say that this statute could be used 
to prosecute someone for camcording a DVD at his home. Is this a fair 
concern?
  Mrs. FEINSTEIN. No, it is not. The definition of a motion picture 
exhibition facility includes the concept that exhibition has to be 
``open to the public or is made to an assembled group of viewers 
outside of a normal circle of a family and its social acquaintances.'' 
This definition makes clear that someone recording from a television in 
his home does not meet that definition. It is important to emphasize 
that the clause ``open to the public'' applies specifically to the 
exhibition, to the facility. An exhibition in a place open to the 
public that is itself not made to the public is not the subject of this 
bill. Thus, for example, a university film lab may be ``open to the 
public.'' However, a student who is watching a film in that lab for his 
or her own study or research would not be engaging in an exhibition 
that is ``open to the public.'' Thus, if that student copied an excerpt 
from such an exhibition, he or she would not be subject to liability 
under the bill.
  Mr. HATCH. Do the users of hearing aids, cell phones or similar 
devices have anything to fear from this statute?
  Mrs. FEINSTEIN. Of course not. The statute covers only a person who 
``knowingly uses or attempts to use an audiovisual recording device to 
transmit or make a copy of a motion picture or other audiovisual work 
protected under Title 17, or any part thereof . . . In other words, the 
defendant would have to be making, or attempting to make, a copy that 
is itself an audiovisual work, or make, or attempt to make, a 
transmission embodying an audiovisual work, as that term is defined in 
Section 101 of Title 17. As much, the Act would into reach the conduct 
of a person who uses a hearing aid, a still camera, or a picture phone 
to capture an image or mere sound from the movie.
  Mr. HATCH. It appears that there is no fair use exception to this 
provision. Is that correct?
  Mrs. FEINSTEIN. This is a criminal provision under Title 18, not a 
copyright provision under Title 17. Accordingly, there is no fair use 
exception included. However, Federal prosecutors should use their 
discretion not to bring criminal prosecutions against activities within 
movie theaters that would constitute fair use under the copyright laws. 
The object of this legislation is to prevent the copying and 
distribution of motion picture in a manner that causes serious 
commercial harm. This legislation is not intended to chill legitimate 
free speech.
  Mr. HATCH. Does the Senator from Texas agree?
  Mr. CORNYN. Yes, on all points.
  Mr. FRIST. I ask unanimous consent that the committee substitute 
amendment be adopted, the bill, as amended, be read the third time and 
passed, the motion to reconsider be laid on the table, and any 
statements be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The committee amendment in the nature of a substitute was agreed to.
  The bill (S. 1932), as amended, was read the third time, and passed.

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