[Congressional Record (Bound Edition), Volume 150 (2004), Part 19]
[Senate]
[Pages 25445-25447]
[From the U.S. Government Publishing Office, www.gpo.gov]




             FAMILY ENTERTAINMENT AND COPYRIGHT ACT OF 2004

 Mr. CORNYN. Mr. President, would the chairman yield for a 
question?
  Mr. HATCH. I would be happy to yield for a question from the 
distinguished Senator from Texas.
  Mr. CORNYN. As the chairman knows, he and I and our other co-sponsors 
have worked throughout this Congress on the provisions of the Family 
Entertainment and Copyright Act of 2004 that we have introduced today. 
I just want to confirm what I believe to be our mutual understanding 
about the effect of certain provisions of the Family Movie Act. Title 
II of the Family Entertainment and Copyright Act of 2004 that we 
introduced today modifies slightly the Family Movie Act provisions of 
H.R. 4077 as passed by the House of Representatives. That bill created 
a new exemption in section 110(11) of the Copyright Act for skipping 
and muting audio and video content in motion pictures during 
performances that take place in the course of a private viewing in a 
household from an authorized copy of the motion picture. The House-
passed version specifically excluded from the scope of the new 
copyright exemption computer programs or technologies that make 
changes, deletions, or additions to commercial advertisements or to 
network or station promotional announcements that would otherwise be 
displayed before, during, or after the performance of the motion 
picture.
  My understanding is that this provision reflected a ``belt and 
suspenders'' approach that was adopted to quiet the concerns of some 
Members in the House who were concerned that a court might misread the 
statute to apply to ``ad-skipping'' cases. Some Senators, however, 
expressed concern that the inclusion of such explicit language could 
create unwanted inferences as to the ``ad-skipping'' issues at the 
heart of the recent litigation. Those issues remain unsettled, and it 
was never the intent of this legislation to resolve or affect those 
issues. In the meantime, the Copyright Office has confirmed that such a 
provision is unnecessary to achieve the intent of the bill, which is to 
avoid application of this new exemption in potential future cases 
involving ``ad-skipping'' devices; therefore, the Senate amendment we 
offer removes the unnecessary exclusionary language.
  Would the chairman confirm for the Senators present his understanding 
of the intent and effect, or perhaps stated more appropriately, the 
lack of any effect, of the Senate amendment on the scope of this bill?
  Mr. HATCH. My cosponsor, Senator Cornyn, raises an important point. 
While we removed the ``ad-skipping'' language from the statute to avoid 
this unnecessary controversy, you are absolutely correct that this does 
not in any way change the scope of the bill. The bill protects the 
``making imperceptible . . . limited portions of audio or video content 
of a motion picture . . .'' An advertisement, under the Copyright Act, 
is itself a ``motion picture,'' and thus a product or service that 
enables the skipping of an entire advertisement, in any media, would be 
beyond the scope of the exemption. Moreover, the phrase ``limited 
portions'' is intended to refer to portions that are both 
quantitatively and qualitatively insubstantial in relation to the work 
as a whole. Where any substantial part of a complete work, such as a 
commercial advertisement, is made imperceptible, the new section 
110(11) exemption would not apply.
  The limited scope of this exemption does not, however, imply or show 
that such a product would be infringing. This legislation does not in 
any way deal with that issue. It means simply that such a product is 
not immunized from liability by this exemption.
  Mr. CORNYN. I thank the chairman. I am pleased that we share a common 
understanding. If the chairman would yield for one more question about 
the Family Movie Act?
  Mr. HATCH. Certainly.
  Mr. CORNYN. This bill also differs from the House-passed version 
because it adds two ``savings clauses.'' As I understand it, the 
``copyright'' savings clause makes clear that there should be no 
``spillover effect'' from the passage of this law: that is, nothing 
shall be construed to have any effect on rights, defenses, or 
limitations on rights granted under title 17, other than those 
explicitly provided for in the new section 110(11) exemption. The 
second, relating to trademark, clarifies that no inference can be drawn 
that a person or company who fails to qualify for the exemption from 
trademark infringement found in this provision is therefore liable for 
trademark infringement. Is that the chairman's understanding as well?
  Mr. HATCH. Yes it is. Let me ask that a copy of the section-by-
section analysis of the Family Movie Act as amended by the Senate be 
included in the Record. This section-by-section analysis contains a 
more complete analysis of the bill as proposed today in the Senate, 
including the limited changes made by the bill Senators Leahy, Cornyn, 
Biden, and I offer today.
  The analysis follows.

 Section-by-Section Analysis of the Family Movie Act of 2004, Amended 
                        and Passed by the Senate


                                Overview

       Title II of the Family Entertainment and Copyright Act of 
     2004 incorporates the House-passed provision of the Family 
     Movie Act of 2004, with limited changes as reflected in this 
     section-by-section analysis. As discussed herein, these 
     changes are not intended to and do not affect the scope, 
     effect or application of the bill.
       The purpose of the Family Movie Act is to empower private 
     individuals to use technology to skip and mute material that 
     they find objectionable in movies, without impacting 
     established doctrines of copyright or

[[Page 25446]]

      trademark law or those whose business models depend upon 
     advertising. This amendment to the law should be narrowly 
     construed to effect its intended purpose only. The sponsors 
     of the legislation have been careful to tailor narrowly the 
     legislation to clearly allow specific, consumer-directed 
     activity and not to open or decide collateral issues or to 
     affect any other potential or actual disputes in the law.
       The bill as proposed in the Senate makes clear that, under 
     certain conditions, ``making imperceptible'' of limited 
     portions of audio or video content of a motion picture--that 
     is, skipping and muting limited portions of movies without 
     adding any content--as well as the creation or provision of a 
     computer program or other technology that enables such making 
     imperceptible, does not violate existing copyright or 
     trademark laws. That is true whether the movie is on 
     prerecorded media, like a DVD, or is transmitted to the home, 
     as through pay-per-view and ``video-on-demand'' services.
     Subsection (a): Short Title
       Subsection (a) sets forth the short title of the bill as 
     the Family Movie Act of 2004.
     Subsection (b): Exemption From Copyright and Trademark 
         Infringement for Skipping of Audio or Video Content of 
         Motion Pictures
       Subsection (b) is the Family Movie Act's core provision and 
     creates a new exemption at section 110(11) of the Copyright 
     Act for the ``making imperceptible'' of limited portions of 
     audio or video content of a motion picture during a 
     performance in a private household. This new exemption sets 
     forth a number of conditions to ensure that it achieves its 
     intended effect while remaining carefully circumscribed and 
     avoiding any unintended consequences. The conditions that 
     allow an exemption, which are discussed in more detail below, 
     consist of the following:
       The making imperceptible must be ``by or at the direction 
     of a member of a private household.'' This legislation 
     contemplates that any altered performances of the motion 
     picture would be made either directly by the viewer or at the 
     direction of a viewer where the viewer is exercising 
     substantial choice over the types of content they choose to 
     skip or mute.
       The making imperceptible must occur ``during a performance 
     in or transmitted to the household for private home 
     viewing.'' Thus, this provision does not exempt an 
     unauthorized ``public performance'' of an altered version.
       The making imperceptible must be ``from an authorized copy 
     of a motion picture.'' Thus, skipping and muting from an 
     unauthorized or ``bootleg'' copy of a motion picture would 
     not be exempt.
       No ``fixed copy'' of the altered version of the motion 
     picture may be created by the computer program or other 
     technology that makes imperceptible portions of the audio or 
     video content of the motion picture. This provision makes 
     clear that services or technologies that make a fixed copy of 
     the altered version are not afforded the benefit of this 
     exemption.
       The ``making imperceptible'' of limited portions of a 
     motion picture does not include the addition of audio or 
     video content over or in place of other content, such as 
     placing a modified image of a person, a product, or an 
     advertisement in place of another, or adding content of any 
     kind.
       These limitations, and other operative provisions of this 
     new section 110(11) exemption, merit further elaboration as 
     to their purposes and effects.
       The bill makes clear that the ``making imperceptible'' of 
     limited portions of audio or video content of a motion 
     picture must be done by or at the direction of a member of a 
     private household. While this limitation does not require 
     that the individual member of the private household exercise 
     ultimate decision-making over each and every scene or element 
     of dialog in the motion picture that is to be made 
     imperceptible, it does require that the making imperceptible 
     be made at the direction of that individual in response to 
     the individualized preferences expressed by that individual. 
     The test of ``at the direction of an individual'' would be 
     satisfied when an individual selects preferences from among 
     options that are offered by the technology.
       An example is the C1earPlay model. C1earPlay provides so-
     called ``filter files'' that allow a viewer to express his or 
     her preferences in a number of different categories, 
     including language, violence, drug content, sexual content, 
     and several others. The version of the movie that the viewer 
     sees depends upon the preferences expressed by that viewer. 
     Such a model would fall under the liability limitation of the 
     Family Movie Act.
       This limitation, however, would not allow a program 
     distributor, such as a provider of video-on-demand services, 
     a cable or satellite channel, or a broadcaster, to make 
     imperceptible limited portions of a movie in order to provide 
     an altered version of that movie to all of its customers, 
     which could violate a number of the copyright owner's 
     exclusive rights, or to make a determination of scenes to be 
     skipped or dialog to be muted and to offer to its viewers no 
     more of a choice than to view an original or an altered 
     version of that film. Some element of individualized 
     preferences and control must be present such that the viewer 
     exercises substantial choice over the types of content they 
     choose to skip or mute.
       It is also important to emphasize that the new section 
     110(11) exemption is targeted narrowly and specifically at 
     the act of ``making imperceptible'' limited portions of audio 
     or video content of a motion picture during a performance 
     that occurs in, or that is transmitted to, a private 
     household for private home viewing. This section would not 
     exempt from liability an otherwise infringing performance, or 
     a transmission of a performance, during which limited 
     portions of audio or video content of the motion picture are 
     made imperceptible. In other words, where a performance in a 
     household or a transmission of a performance to a household 
     is done lawfully, the making imperceptible limited portions 
     of audio or video content of the motion picture during that 
     performance, consistent with the requirements of this new 
     section, will not result in infringement liability. 
     Similarly, an infringing performance in a household, or an 
     infringing transmission of a performance to a household, are 
     not rendered non-infringing by section 110(11) by virtue of 
     the fact that limited portions of audio or video content of 
     the motion picture being performed are made imperceptible 
     during such performance or transmission in a manner 
     consistent with that section.
       The bill also provides additional guidance, if not an exact 
     definition, of what the term ``making imperceptible'' means. 
     The bill provides specifically that the term ``making 
     imperceptible'' does not include the addition of audio or 
     video content that is performed or displayed over or in place 
     of existing content in a motion picture. This is intended to 
     make clear in the text of the statute what has been expressed 
     throughout the consideration of this legislation, which is 
     that the Family Movie Act does not enable the addition of 
     content of any kind, including the making imperceptible of 
     audio or video content by replacing it or by superimposing 
     other content over it. In other words, for purposes of 
     section 110(11), ``making imperceptible'' refers solely to 
     skipping scenes and portions of scenes or muting audio 
     content from the original, commercially available version of 
     the motion picture. No other modifications of the content are 
     addressed or immunized by this legislation.
       The House sponsor of this legislation noted in his 
     explanation of his bill, and the Senate is also aware, that 
     some copy protection technologies rely on matter placed into 
     the audio or video signal. The phrase ``limited portions of 
     audio or video content of a motion picture'' means what it 
     would naturally seem to mean (i.e., the actual content of the 
     motion picture) and does not refer to any component of a copy 
     protection scheme or technology. This provision does not 
     allow the skipping of technologies or other copy-protection-
     related matter for the purpose of defeating copy protection. 
     Rather, it is expected that skipping and muting of content in 
     the actual motion picture will be skipped or muted at the 
     direction of the viewer based on that viewer's desire to 
     avoid seeing or hearing the action or sound in the motion 
     picture. Skipping or muting done for the purpose of or having 
     the effect of avoiding copy protection technologies would be 
     an abuse of the safe harbor outlined in this legislation and 
     may violate section 1201 of title 17.
       Violating the Digital Millennium Copyright Act, and 
     particularly its anti-circumvention provisions, is not 
     necessary to enable technology of the kind contemplated under 
     the Family Movie Act. Although the amendment to section 110 
     provides that it is not an infringement of copyright to 
     engage in the conduct that is the subject of the Family Movie 
     Act, the Act does not provide any exemption from the anti-
     circumvention provisions of section 1201 of title 17, or from 
     any other provision of chapter 12 of title 17. It would not 
     be a defense to a claim of violation of section 1201 that the 
     circumvention is for the purpose of engaging in the conduct 
     covered by this new exemption in section 110(11), just as it 
     is not a defense under section 1201 that the circumvention is 
     for the purpose of engaging in any other non-infringing 
     conduct.
       There are a number of companies currently providing the 
     type of products and services covered by this Act. The Family 
     Movie Act is intended to facilitate the offering of such 
     products and services, and it certainly creates no impediment 
     to the technology employed by those companies. Indeed, it is 
     important to underscore the fact that the support for such 
     technology and consumer offerings that is reflected in this 
     legislation is driven in some measure by the desire for 
     copyright law to be respected and to ensure that technology 
     is deployed in a way that supports the continued creation and 
     protection of entertainment and information products that 
     rely on copyright protection. This legislation reflects the 
     firm expectation that those rights and the interests of 
     viewers in their homes can work together in the context 
     defined in this bill. Any suggestion that support for the 
     exercise of viewer choice in modifying their viewing 
     experience of copyrighted works requires violation of either 
     the copyright in the work or of the copy protection schemes 
     that provide protection for

[[Page 25447]]

     such work should be rejected as counter to legislative intent 
     or technological necessity.
       The House-passed bill included an explicit exclusion to the 
     new section 110(11) exemption in cases involving the making 
     imperceptible of commercial advertisements or network or 
     station promotional announcements. This provision was added 
     on the House floor to respond to concerns expressed by 
     Members during the House Judiciary Committee markup that the 
     bill might be read somehow to exempt from copyright 
     infringement liability devices that allow for skipping of 
     advertisements in the playback of recorded television (so 
     called ``ad-skipping'' devices). Such a reading is not 
     consistent with the language of the bill or its intent.
       The phrase ``limited portions of audio or video content of 
     a motion picture'' applies only to the skipping and muting of 
     scenes or dialog that are part of the motion picture itself, 
     and not to the skipping of commercial advertisements, which 
     are themselves considered motions pictures under the 
     Copyright Act. It also should be noted that the phrase 
     ``limited portions'' is intended to refer to portions that 
     are both quantitatively and qualitatively insubstantial in 
     relation to the work as a whole. Where any substantial part 
     of a complete work (including a commercial advertisement) is 
     made imperceptible, the section 110(11) exemption would not 
     apply.
       The House-passed bill adopted a ``belt and suspenders'' 
     approach to this question by adding exclusionary language in 
     the statute itself. Ultimately that provision raised concerns 
     in the Senate that such exclusionary language would result in 
     an inference that the bill somehow expresses an opinion, or 
     even decides, the unresolved legal questions underlying 
     recent litigation related to these so-called ``ad-skipping'' 
     devices. In the meantime, the Copyright Office also made 
     clear that such exclusionary language is not necessary. In 
     other words, the exclusionary language created unnecessary 
     controversy without adding any needed clarity to the statute.
       Thus, the Senate amendment omits the exclusionary language 
     while leaving the scope and application of the bill exactly 
     as it was when it passed the House. The legislation does not 
     provide a defense in cases involving so-called ``ad-
     skipping'' devices, and it also does not affect the legal 
     issues underlying such litigation, one way or another. 
     Consistent with the intent of the legislation to fix a narrow 
     and specific copyright issue, this bill seeks very clearly to 
     avoid unnecessarily interfering with current business models, 
     especially with respect to advertising, promotional 
     announcements, and the like. Simply put, the bill as amended 
     in the Senate is narrowly targeted to the use of technologies 
     and services that filter out content in movies that a viewer 
     finds objectionable, and it in no way relates to or affects 
     the legality of so-called ``ad-skipping'' technologies.
       There are a variety of services currently in litigation 
     that distribute actual copies of altered movies. This type of 
     activity is not covered by the section 110(11) exemption 
     created by the Family Movie Act. There is a basic distinction 
     between a viewer choosing to alter what is visible or audible 
     when viewing a film, the focus of this legislation, and a 
     separate entity choosing to create and distribute a single, 
     altered version to members of the public. The section 110(11) 
     exemption only applies to viewer directed changes to the 
     viewing experience, and not the making or distribution of 
     actual altered copies of the motion picture.
       Related to this point, during consideration of this 
     legislation in the House there were conflicting expert 
     opinions on whether fixation is required to infringe the 
     derivative work right under the Copyright Act, as well as 
     whether evidence of Congressional intent in enacting the 1976 
     Copyright Act supports the notion that fixation should not be 
     a prerequisite for the preparation of an infringing 
     derivative work. This legislation should not be construed to 
     be predicated on or to take a position on whether fixation is 
     necessary to violate the derivative work right, or whether 
     the conduct that is immunized by this legislation would be 
     infringing in the absence of this legislation.
       Subsection (b) also provides a savings clause to make clear 
     that the newly-created copyright exemption is not to be 
     construed to have any effect on rights, defenses, or 
     limitations on rights granted under title 17, other than 
     those explicitly provided for in the new section 110(11) 
     exemption.
     Subsection (c): Exemption From Trademark Infringement
       Subsection (c) provides for a limited exemption from 
     trademark infringement for those engaged in the conduct 
     described in the new section 110(11) of the Copyright Act.
       In short, this subsection makes clear that a person 
     engaging in the conduct described in section 110(11)--the 
     ``making imperceptible'' of portions of audio or video 
     content of a motion picture or the creation or provision of 
     technology to enable such making available--is not subject to 
     trademark infringement liability based on that conduct, 
     provided that person's conduct complies with the requirements 
     of section 110(11). This section provides a similar exemption 
     for a manufacturer, licensee or licensor of technology that 
     enables such making imperceptible, but such manufacturer, 
     licensee or licensor is subject to the additional requirement 
     that it ensure that the technology provides a clear and 
     conspicuous notice at the beginning of each performance that 
     the performance of the motion picture is altered from the 
     performance intended by the director or the copyright holder.
       Of course, nothing in this section would immunize someone 
     whose conduct, apart from the narrow conduct described by 
     110(11), rises to the level of a Lanham Act violation. For 
     example, someone who provides technology to enable the making 
     imperceptible limited portions of a motion picture consistent 
     with section 110(11) could not be held liable on account of 
     such conduct under the Trademark Act, but if in providing 
     such technology the person also makes an infringing use of a 
     protected mark or engages in other ancillary conduct that is 
     infringing, such conduct would not be subject to the 
     exemption provided here. As amended by the Senate, the bill 
     also makes clear that failure by a manufacturer, licensee, or 
     licensor of technology to qualify for the exemption created 
     by this subsection is not, by itself, enough to establish 
     trademark infringement. Failure to qualify for the safe 
     harbor from trademark liability merely means that the 
     manufacturer, licensee, or other licensor of technology 
     cannot assert an affirmative defense based on this exemption 
     in a case where trademark infringement or some other 
     violation of the Trademark Act is established.
     Subsection (d): Definition
       Subsection (d) provides definitional clarification 
     regarding short-hand references throughout this section to 
     the ``Trademark Act of 1946.''

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