[House Report 108-670]
[From the U.S. Government Publishing Office]



108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     108-670

======================================================================
 
                        FAMILY MOVIE ACT OF 2004

                                _______
                                

 September 8, 2004.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 4586]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on the Judiciary, to whom was referred the bill 
(H.R. 4586) to provide that making limited portions of audio or 
video content of motion pictures imperceptible by or for the 
owner or other lawful possessor of an authorized copy of that 
motion picture for private home viewing, and the use of 
technology therefor, is not an infringement of copyright or of 
any right under the Trademark Act of 1946, having considered 
the same, reports favorably thereon with an amendment and 
recommends that the bill as amended do pass.

                                CONTENTS

                                                                   Page
The Amendment....................................................     2
Purpose and Summary..............................................     2
Background and Need for the Legislation..........................     3
Hearings.........................................................     4
Committee Consideration..........................................     4
Vote of the Committee............................................     4
Committee Oversight Findings.....................................     5
New Budget Authority and Tax Expenditures........................     5
Congressional Budget Office Cost Estimate........................     5
Performance Goals and Objectives.................................     7
Constitutional Authority Statement...............................     7
Section-by-Section Analysis and Discussion.......................     7
Changes in Existing Law Made by the Bill, as Reported............     7
Markup Transcript................................................     9
Dissenting Views.................................................    41

                             The Amendment

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Family Movie Act of 2004''.

SEC. 2. EXEMPTION FROM COPYRIGHT INFRINGEMENT FOR SKIPPING OF AUDIO OR 
                    VIDEO CONTENT OF MOTION PICTURES.

    Section 110 of title 17, United States Code, is amended--
            (1) in paragraph (9), by striking ``and'' after the 
        semicolon at the end;
            (2) in paragraph (10), by striking the period at the end 
        and inserting ``; and''; and
            (3) by inserting after paragraph (10) the following:
            ``(11)(A) the making of limited portions of audio or video 
        content of a motion picture imperceptible by or for the owner 
        or other lawful possessor of an authorized copy of that motion 
        picture in the course of viewing of that work for private use 
        in a household, by means of consumer equipment or services 
        that--
                    ``(i) are operated by an individual in that 
                household;
                    ``(ii) serve only such household; and
                    ``(iii) do not create a fixed copy of the altered 
                version; and
            ``(B) the use of technology to make such audio or video 
        content imperceptible, that does not create a fixed copy of the 
        altered version.''.

SEC. 3. EXEMPTION FROM TRADEMARK INFRINGEMENT FOR SKIPPING OF AUDIO OR 
                    VIDEO CONTENT OF MOTION PICTURES.

    Section 32 of the Trademark Act of 1946 (15 U.S.C. 1114) is amended 
by adding at the end the following:
    ``(3)(A) Any person who engages in the conduct described in 
paragraph (11) of section 110 of title 17, United States Code, and who 
complies with the requirements set forth in that paragraph is not 
liable on account of such conduct for a violation of any right under 
this Act.
    ``(B) A manufacturer, licensee, or licensor of technology that 
enables the making of limited portions of audio or video content of a 
motion picture imperceptible that is authorized under subparagraph (A) 
is not liable on account of such manufacture or license for a violation 
of any right under this Act. Such manufacturer, licensee, or licensor 
shall ensure that the technology provides a clear and conspicuous 
notice that the performance of the motion picture is altered from the 
performance intended by the director or copyright holder of the motion 
picture.
    ``(C) Any manufacturer, licensee, or licensor of technology 
described in subparagraph (B) who fails to comply with the requirement 
under subparagraph (B) to provide notice with respect to a motion 
picture shall be liable in a civil action brought by the copyright 
owner of the motion picture that is modified by the technology in an 
amount not to exceed $1,000 for each such motion picture.
    ``(D) The requirement under subparagraph (B) to provide notice, and 
the provisions of subparagraph (C), shall apply only with respect to 
technology manufactured after the end of the 180-day period beginning 
on the date of the enactment of the Family Movie Act of 2004.''.

SEC. 4. DEFINITION.

    In this Act, the term ``Trademark Act of 1946'' means the Act 
entitled ``An Act to provide for the registration and protection of 
trademarks used in commerce, to carry out the provisions of certain 
international conventions, and for other purposes'', approved July 5, 
1946 (15 U.S.C. 1051 et seq.).

                          Purpose and Summary

    The purpose of H.R. 4586 is to clarify that existing law 
allows companies to offer technologies and services that filter 
out inappropriate or adult content in movies, usually digital 
video discs (DVDs).

                Background and Need for the Legislation

    Motion picture fans have become increasingly concerned 
about picture content that they do not want to watch or hear, 
including that related to sex, profanity, and violence. For 
years, parents have manually turned down the volume of the 
audio or simply turned off playback of the offensive content. 
In recent years, people have begun using remote controls 
bundled with playback devices to accomplish the same thing. 
However, the ability of parents to manually filter out all of 
the content that they view as inappropriate has become more 
difficult as the number of sources of entertainment continues 
to increase.
    The Committee notes that airline and broadcast versions of 
numerous motion pictures exist that have been edited for 
offensive content. In the Committee's view, these works 
manifest a valuable family friendly market that directors and 
copyright holders are willing to serve by editing their movies. 
The ongoing policy dispute involving H.R. 4586 may have been 
avoided if these airline and broadcast versions had been made 
available for sale to the public in the first place.
    Because these versions are not being made available by 
copyright owners, a growing number of companies are now 
offering services to assist families in their efforts to shield 
their children from inappropriate content. These services range 
from selling derivative works to the public that have been 
edited by a third party other than the director or copyright 
holder to technology that skips and mutes content that parents 
may not want their children to watch or hear. Such services 
have spawned recent litigation between the companies that offer 
these services and the affected copyright holders.
    The Committee believes these services are an important tool 
for parents and other citizens concerned about audiovisual 
content to filter out inappropriate content. There is ongoing 
litigation in Colorado that is placing the viability of such 
services into question. The Committee believes that legislation 
is necessary to clarify which services and technology do not 
conflict with those rights protected under existing copyright 
and trademark law. The Committee is not endorsing any 
particular technology or service as either legal or more 
suitable for consumers than others. The decision regarding 
preference is left to consumers; the decision regarding 
legality is left to the courts.
    The Committee is nonetheless concerned that one service 
that has adopted a model that is already legal under existing 
law is embroiled in litigation. In fact, the Register of 
Copyrights testified on June 17, 2004, that this model is legal 
under existing law.\1\ The Committee believes that ongoing 
litigation threatens the viability of services that operate 
under this legal model and that legislation to clarify the 
legality of this model is therefore necessary.
---------------------------------------------------------------------------
    \1\ Family Movie Act: Hearings on H.R. 4586 Before the Subcomm. on 
Courts, the Internet, and Intellectual Property of the House of 
Representatives Comm. on the Judiciary, 108th Cong. 94 (2004).
---------------------------------------------------------------------------
    The model of services that the Committee believes is legal 
only skips and mutes content without adding any new audio or 
video content while making it clear to the end user that the 
modified version may not be supported by the director.
    Under existing law, moral (reputational) rights do not 
supersede parental rights to raise children as they see fit. 
The Committee believes that directors should be assured that 
their works are properly identified as such; but these same 
directors may not control every detail of how their works are 
displayed, particularly for a legal copy aired in the privacy 
of a consumer's home. Several directors and a trade association 
representing them have argued that for-profit services that 
offer families a means to control what they watch in the 
privacy of their own home were illegal under existing copyright 
law. The Committee strongly disagrees with this interpretation 
of copyright law.

                                Hearings

    The Committee's Subcommittee on Courts, the Internet, and 
Intellectual Property held an oversight hearing on this issue 
on May 20, 2004, with testimony received from five witnesses 
representing five organizations. The Subcommittee subsequently 
held a hearing on H.R. 4586 on June 17, 2004. Testimony was 
received from four witnesses representing four organizations.

                        Committee Consideration

    On July 8, 2004, the Subcommittee on Courts, the Internet, 
and Intellectual Property met in open session and ordered 
favorably reported the bill H.R. 4586, as amended, by a vote of 
11 to 5, a quorum being present. On July 21, 2004, the 
Committee met in open session and ordered favorably reported 
the bill H.R. 4586 with an amendment by a vote of 18 to 9, a 
quorum being present.

                         Vote of the Committee

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee notes that the 
following recorded vote occurred during the Committee's 
consideration of H.R. 4586. The Committee adopted the motion to 
report the bill favorably with an amendment by a vote of 18 
yeas to 9 noes.

                                                   ROLLCALL NO. 1
----------------------------------------------------------------------------------------------------------------
                                                                       Ayes            Nays           Present
----------------------------------------------------------------------------------------------------------------
Mr. Hyde........................................................
Mr. Coble.......................................................              X
Mr. Smith.......................................................              X
Mr. Gallegly....................................................              X
Mr. Goodlatte...................................................              X
Mr. Chabot......................................................              X
Mr. Jenkins.....................................................              X
Mr. Cannon......................................................              X
Mr. Bachus......................................................
Mr. Hostettler..................................................              X
Mr. Green.......................................................              X
Mr. Keller......................................................              X
Ms. Hart........................................................              X
Mr. Flake.......................................................
Mr. Pence.......................................................
Mr. Forbes......................................................              X
Mr. King........................................................              X
Mr. Carter......................................................              X
Mr. Feeney......................................................              X
Mrs. Blackburn..................................................              X
Mr. Conyers.....................................................                              X
Mr. Berman......................................................                              X
Mr. Boucher.....................................................
Mr. Nadler......................................................
Mr. Scott.......................................................                              X
Mr. Watt........................................................                              X
Ms. Lofgren.....................................................              X
Ms. Jackson Lee.................................................                              X
Ms. Waters......................................................                              X
Mr. Meehan......................................................
Mr. Delahunt....................................................
Mr. Wexler......................................................
Ms. Baldwin.....................................................                              X
Mr. Weiner......................................................
Mr. Schiff......................................................                              X
Ms. Sanchez.....................................................                              X
Mr. Sensenbrenner, Chairman.....................................              X
                                                                 -----------------------------------------------
    Total.......................................................             18               9
----------------------------------------------------------------------------------------------------------------

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII of the Rules 
of the House of Representatives, the Committee reports that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives is inapplicable because this legislation does 
not provide new budgetary authority or increased tax 
expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 4586, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, August 17, 2004.
Hon. F. James Sensenbrenner, Jr., Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4586, the Family 
Movie Act of 2004.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Melissa E. 
Zimmerman (for Federal costs), who can be reached at 226-2860, 
and Paige Piper/Bach (for the private-sector impact), who can 
be reached at 226-2960.
            Sincerely,
                                       Douglas Holtz-Eakin.

Enclosure

cc:
        Honorable John Conyers, Jr.
        Ranking Member
H.R. 4586--Family Movie Act of 2004.
    H.R. 4586 would specify that technology used to filter 
certain material out of movies for private viewing would not 
constitute a violation of copyright or trademark law. CBO 
estimates that implementing H.R. 4586 would have no effect on 
Federal spending.
    H.R. 4586 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would not affect 
the budgets of State, local, or tribal governments.
    H.R. 4586 would impose private-sector mandates as defined 
in UMRA. CBO estimates that the direct cost of the mandates 
would fall well below the annual threshold established by UMRA 
for private-sector mandates ($120 million in 2004, adjusted 
annually for inflation).
    First, the bill would impose a private-sector mandate on 
copyright owners. The bill would limit the right of copyright 
owners to collect compensation under copyright law from persons 
using or manufacturing a technology that enables making limited 
changes to a motion picture for a private home viewing. 
According to testimony from the Patent and Trademark Office and 
other sources, no such compensation is currently received by 
copyright owners. Therefore, CBO estimates that the direct cost 
of the mandate, measured as net income forgone, would be small 
or zero.
    Second, the bill also would impose a private-sector mandate 
on manufacturers, licensees, and licensors of technology that 
enables the making of limited portions of audio or video 
content of a motion picture imperceptible. Such manufacturers, 
licensees, or licensors would be required to ensure that the 
technology provides a clear and conspicuous notice that the 
performance of the motion picture is altered from the 
performance intended by the director or copyright holder of the 
motion picture. Complying with the mandate would exempt such 
manufacturers, licensees, or licensors from liability under 
section 32 of the Trademark Act of 1946. The direct cost of the 
mandate on those private-sector entities would be the total 
cost of providing the notice less the direct savings achieved 
by limiting their liability. CBO has no basis for determining 
the direct savings for the exemption from trademark liability. 
However, according to Government and other sources, the 
technology to provide the required notice is readily available 
and is currently used by some manufacturers. Thus, CBO expects 
the direct cost to comply with the mandate, if any, would be 
minimal.
    The CBO staff contacts for this estimate are Melissa E. 
Zimmerman (for Federal costs), who can be reached at 226-2860, 
and Paige Piper/Bach (for the private-sector impact), who can 
be reached at 226-2940. The estimate was approved by Peter H. 
Fontaine, Deputy Assistant Director for Budget Analysis.

                    Performance Goals and Objectives

    The Committee states that pursuant to clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, H.R. 
4586 is designed to clarify the legality of existing and future 
services and technology that enable the skipping or muting of 
content in audio-visual works.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the authority for 
this legislation in article I, Sec. 8, of the Constitution.

               Section-by-Section Analysis and Discussion

    The following discussion describes the bill as reported by 
the Committee.
    Section 1 provides that this Act may be cited as the 
``Family Movie Act of 2004.''
    Section 2 of the legislation creates a new subsection 
Sec. 110 (11) of Title 17. This new subsection ensures that 
U.S. copyright law sanctions the use of any filtering service 
or technology that mutes or skips content, provided the service 
or technology--

        1. Lis confined to private, in-home use, for the 
        household of the purchasing consumer only; and

        2. Ldoes not create a fixed copy of the alternate 
        version.

    The Committee is aware of services and companies that 
create fixed derivative copies of motion pictures and believes 
that such practices are illegal under the Copyright Act.
    Section 3 of the legislation clarifies existing U.S. 
trademark law to ensure that it cannot be interpreted to 
proscribe the operation of services identified in Sec. 2 so 
long as they display a clear and conspicuous notice that the 
altered version is not the performance intended by the director 
or copyright holder of the motion picture. The Committee 
believes that an on-screen disclaimer in large font at the 
beginning of a performance of a particular work that is 
displayed for a length of time suitable for the average viewer 
to read the notice is sufficient. Such notice would be similar 
to the FBI anti-piracy warnings shown at the beginning of most 
major motion pictures. This requirement begins 180 days after 
the legislation becomes law. Since the manufacturer of a 
physical device complying with the requirements maintains 
control over the device before the retail purchase point, these 
requirements should not burden consumer electronics 
manufacturers.

         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

              SECTION 110 OF TITLE 17, UNITED STATES CODE

Sec. 110. Limitations on exclusive rights: Exemption of certain 
                    performances and displays

    Notwithstanding the provisions of section 106, the 
following are not infringements of copyright:
            (1) * * *

           *       *       *       *       *       *       *

            (9) performance on a single occasion of a dramatic 
        literary work published at least ten years before the 
        date of the performance, by or in the course of a 
        transmission specifically designed for and primarily 
        directed to blind or other handicapped persons who are 
        unable to read normal printed material as a result of 
        their handicap, if the performance is made without any 
        purpose of direct or indirect commercial advantage and 
        its transmission is made through the facilities of a 
        radio subcarrier authorization referred to in clause 
        (8)(iii), Provided, That the provisions of this clause 
        shall not be applicable to more than one performance of 
        the same work by the same performers or under the 
        auspices of the same organization; [and]
            (10) notwithstanding paragraph (4), the following 
        is not an infringement of copyright: performance of a 
        nondramatic literary or musical work in the course of a 
        social function which is organized and promoted by a 
        nonprofit veterans' organization or a nonprofit 
        fraternal organization to which the general public is 
        not invited, but not including the invitees of the 
        organizations, if the proceeds from the performance, 
        after deducting the reasonable costs of producing the 
        performance, are used exclusively for charitable 
        purposes and not for financial gain. For purposes of 
        this section the social functions of any college or 
        university fraternity or sorority shall not be included 
        unless the social function is held solely to raise 
        funds for a specific charitable purpose[.]; and
            (11)(A) the making of limited portions of audio or 
        video content of a motion picture imperceptible by or 
        for the owner or other lawful possessor of an 
        authorized copy of that motion picture in the course of 
        viewing of that work for private use in a household, by 
        means of consumer equipment or services that--
                    (i) are operated by an individual in that 
                household;
                    (ii) serve only such household; and
                    (iii) do not create a fixed copy of the 
                altered version; and
            (B) the use of technology to make such audio or 
        video content imperceptible, that does not create a 
        fixed copy of the altered version.

           *       *       *       *       *       *       *

                              ----------                              


                SECTION 32 OF THE TRADEMARK ACT OF 1946

    Sec. 32. (1) * * *

           *       *       *       *       *       *       *

    (3)(A) Any person who engages in the conduct described in 
paragraph (11) of section 110 of title 17, United States Code, 
and who complies with the requirements set forth in that 
paragraph is not liable on account of such conduct for a 
violation of any right under this Act.
    (B) A manufacturer, licensee, or licensor of technology 
that enables the making of limited portions of audio or video 
content of a motion picture imperceptible that is authorized 
under subparagraph (A) is not liable on account of such 
manufacture or license for a violation of any right under this 
Act. Such manufacturer, licensee, or licensor shall ensure that 
the technology provides a clear and conspicuous notice that the 
performance of the motion picture is altered from the 
performance intended by the director or copyright holder of the 
motion picture.
    (C) Any manufacturer, licensee, or licensor of technology 
described in subparagraph (B) who fails to comply with the 
requirement under subparagraph (B) to provide notice with 
respect to a motion picture shall be liable in a civil action 
brought by the copyright owner of the motion picture that is 
modified by the technology in an amount not to exceed $1,000 
for each such motion picture.
    (D) The requirement under subparagraph (B) to provide 
notice, and the provisions of subparagraph (C), shall apply 
only with respect to technology manufactured after the end of 
the 180-day period beginning on the date of the enactment of 
the Family Movie Act of 2004.

                           Markup Transcript



                            BUSINESS MEETING

                        WEDNESDAY, JULY 21, 2004

                  House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 10:00 a.m., in Room 
2141, Rayburn House Office Building, Hon. F. James 
Sensenbrenner, Jr. [Chairman of the Committee] presiding.
    Chairman Sensenbrenner. The Committee will come to order. A 
quorum is present.
    [Intervening business.]
    [11:00 a.m.]
    Chairman Sensenbrenner. Next item on the agenda is H.R. 
4586, the ``Family Movie Act of 2004.'' The Chair recognizes 
the gentleman from Texas Mr. Smith, the Chairman of the 
Subcommittee on Courts, the Internet, and Intellectual 
Property, for a motion.
    Mr. Smith. The Subcommittee on Courts, Internet, and 
Intellectual Property reports favorably the bill H.R. 4586 with 
the single amendment in the nature of a substitute and moves 
its favorable recommendation to the full House.
    Chairman Sensenbrenner. Without objection, the bill will be 
considered as read and open for amendment at any point.
    [The bill, H.R. 4586, follows:]
    
    
    Chairman Sensenbrenner. And the Subcommittee amendment in 
the nature of a substitute which the Members have before them 
will be considered as read, considered as the original text for 
purposes of amendment, and open for amendment at any point.
    [The amendment in the nature of a substitute follows:]
    
    
    Chairman Sensenbrenner. The Chair recognizes the gentleman 
from Texas, Mr. Smith, to strike the last word.
    Mr. Smith. I do move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Smith. Mr. Chairman, we are here today to determine 
whether parents have the right to decide what their children 
watch on the screen in the privacy of their own home. 
Specifically, do parents have a right to protect their children 
from sex, violence, and profanity in the movies?
    These days I don't think anyone would even consider buying 
a DVD player that doesn't come with a remote control, yet there 
are some who would defy the parents the right to use the 
equivalent electronic device that would protect their children 
from offensive material on television. Yes, parents might mute 
dialogue that others deem crucial or might fast-forward over 
scenes that others consider essential, but that is irrelevant. 
Parents should be able to mute or skip over anything they want 
if they feel it is in the best interest of their children. And 
as a practical matter, parents cannot monitor their children's 
viewing habits all the time.
    If you look at a DVD and VCR before and after technology 
has been used to mute or fast-forward over offensive material, 
there would be absolutely no difference in the product. It has 
not been sliced, diced, mutilated, or altered. The director's 
work is still intact. No unauthorized copies have been 
distributed, no copyright violated.
    Some have said that the recent decision by RCA to stop 
selling one brand of family-friendly technology is a sign that 
this legislation should not proceed. This issue has never been 
about simply one company or one technology. It has always been 
about the ultimate right of parents to limit the profanity, 
sex, and violence that their children are exposed to in the 
privacy of their own home.
    In fact, the Register of Copyrights has testified that 
skipping of content is legal under the law. Most recently the 
Supreme Court itself has issued a decision in Ashcroft v. ALCU 
concerning the Children's On-Line Protection Act. The majority 
opinion noted at length their preference for private sector 
filters to protect children from objectionable content on the 
Internet. Two quotes from the majority opinion are noteworthy. 
Quote, ``Filters are less restrictive than the Children's On-
Line Protection Act. They impose selective restrictions on 
speech at the receiving end, not universal restrictions at the 
source.'' the majority then added, quote, ``by enacting 
programs to promote use of filtering software, Congress could 
give parents that ability without subjecting protected speech 
to severe penalties,'' end quote.
    Just as the author of a book should not be able to force me 
or anyone else to read that book in any particular manner, a 
studio or director should not be able to force me or my 
children to watch a movie in a particular way. No one would 
argue that it would be or it should be against the law to skip 
over a few pages or even entire chapters of a book. So too it 
should not be illegal to skip over a few words or scenes in a 
movie.
    One criticism is that no one forces parents to make sure 
children watch objectionable movies. However, popular movies 
are used as homework assignments in many middle and high 
schools today. The parents are in fact forced to allow their 
children to watch a movie in the privacy of their own home, 
even though the movies contain objectionable content.
    However, Mr. Chairman, even that criticism itself is a 
distraction. Parents should have the right to show any movie 
they want and to skip or mute over any content they find 
objectionable. The Family Movie Act ensures that parents have 
those rights.
    Mr. Chairman, I will yield back the balance of my time.
    Chairman Sensenbrenner. Mr. Berman, the gentleman from 
California.
    Mr. Berman. Thank you, Mr. Chairman. I move to strike the 
last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Berman. Mr. Chairman, I ask my colleagues to oppose 
this bill. Notwithstanding the comments of my friend, the 
Chairman of the Subcommittee, and I think this is probably the 
first bill in the year and a half that he has been Chair and I 
have been Ranking Member where I disagree with him on an item 
that came out of Subcommittee as opposed to some other issues 
which don't come out of our Subcommittee.
    This is not a bill about empowering parents or protecting 
children. Notwithstanding the rhetoric in the opening 
statement, notwithstanding the Republican memo, I ask the 
Committee to remember two things. In the subCommittee I offered 
an amendment to ensure this bill only legalizes movie editing 
done on behalf of minor children. That amendment was rejected. 
I also offered an amendment, and Mr. Schiff is going to be 
offering an amendment on this bill, that limited the filtering 
to profanity, violence, and explicit sexual conduct. That 
amendment was rejected by the majority.
    So in defeating those amendments, essentially, and in the 
rhetoric to defeat those amendments, the supporters of the bill 
as presented to us stated that it is intended to facilitate 
movie editing by anyone, for anyone, for any purpose, not just 
for children. So even the bill's sponsors have acknowledged 
that this bill is not focused on empowering parents or 
protecting children.
    Let's be clear about something else too. H.R. 4586 does not 
give parents the ability to do anything they cannot legally do 
today. No parent has ever been sued or threatened with suit for 
editing or censoring the movies their children see. In fact, 
the Register of Copyrights have testified that H.R. 4586 is, 
quote, ``not needed because it seems reasonably clear that such 
conduct is not prohibited under existing law.'' copyright 
owners themselves clearly admit that parents have the legal 
authority to do such editing in the privacy of their own home.
    The bill is also not needed to give parents the 
technological ability to edit or censor the movies their 
children watch. To a large extent, parents already have this 
ability. They can use their remote control to fast forward, 
mute, or turn off a movie. They can engage their V-chips that 
are built into all televisions sold these days. And this bill 
does nothing to legalize technologies that enable parents to 
make editorial decisions about which movie scenes their 
children cannot see or hear.
    So what does this bill do? It gives for-profit companies 
the right to commercially exploit the copyrights and trademarks 
of movie makers without fear of liability. It allows those for-
profit companies to make editorial decisions about movies 
without the input of their creators and to market products 
containing those editorial decisions to anyone, parents or 
otherwise. This is the key point. H.R. 4586 does not empower 
parents to make editorial decisions about which scenes their 
children will or won't see; rather, it empowers for-profit 
companies like ClearPlay to make editorial decisions about 
which movie scenes other people's children will or won't see.
    When a parent uses a remote control to fast-forward through 
a scene, it is the parent who views the scene and assesses 
whether it is inappropriate for the child. Again, it is 
absolutely clear that such editing is entirely legal today. 
However, when a parent engages a ClearPlay filter, the parent 
relies on a nameless, faceless ClearPlay employee to decide 
which scenes are inappropriate for her child.
    The question at the heart of this bill and the copyright 
litigation to which it reacts is whether ClearPlay should be 
able to engage in such commercial editing without the 
permission of copyright and trademark owners. I don't believe 
Congress should be in the business of giving ClearPlay such a 
right.
    Even if you believe ClearPlay should have the legal ability 
to do such commercial editing, this bill won't get you there. 
H.R. 4586 only protects movie filtering technologies like 
ClearPlay from liability for copyright and trademark 
infringement, but it doesn't protect them, at least at this 
point, from suits for patent infringement.
    At least one company, Nissan Corporation, claims to have a 
patent over ClearPlay-type technology and has sued ClearPlay 
for patent infringement. Since Thompson Electronics recently 
pulled its ClearPlay-enabled DVD players from the market, it 
appears that Nissan's patent claims are well founded. Thus, if 
H.R. 4586 were to become law, ClearPlay very likely will not be 
able to distribute its technology. In fact, if it is----
    Chairman Sensenbrenner. The time of the gentleman has 
expired.
    Mr. Berman. I ask unanimous consent for 2 additional 
minutes.
    Chairman Sensenbrenner. Without objection.
    Mr. Berman. If the patent claims are valid, Nissan 
Corporation would be the only company that H.R. 4586 benefits. 
Nissan would be the only company that could distribute its 
technology without fear of liability. Knowing the professed 
intent of the bill's sponsors, I find it highly ironic that 
H.R. 4586 may exclusively benefit Nissan. Nissan, unlike 
ClearPlay, distributes a technology called Custom Play--well, 
actually ClearPlay distributes the same technology, but Nissan 
advertises that it allows movie viewers to either reduce or 
enhance the level of violence, sex, and profanity in a movie. 
The Nissan Web site states that using Custom Play technology, 
an adult can play a version of an adult video that seamlessly 
excludes content inconsistent with the viewer's adult content 
preferences. And that is presented at a level of explicitness 
preferred by the adult. Adult content categories are 
standardized and are organized into five groups: who, what, 
camera, position, and fetish. In other words, H.R. 4586 
exclusively protects from liability a technology that, among 
other things, enables viewers of pornographic movies to filter 
out the nonpornographic scenes. I am sure its sponsors don't 
intend H.R. 4586 to solely benefit a company that makes 
pornography more pornographic; however, that may very will be 
its effect.
    Now they are aware of the risk, I think they should think 
twice before asking Committee Members to vote in favor of this 
bill. Upon reflection, I think the bill's sponsors may agree 
with the Register of Copyrights who testified, quote----
    Chairman Sensenbrenner. The gentleman's time has once again 
expired.
    Without objection, all Members' opening statements will 
appear in the record at this point.
    [The prepared statement of Ms. Waters follows:]
Prepared Statement of the Honorable Maxine Waters, a Representative in 
                 Congress From the State of California
    Mr. Chairman, I move to strike the last word.
    Mr. Chairman, I have significant concerns about this bill. Mr. 
Berman has expressed many of them. Yet these concerns are somewhat 
lessened because the technology that we are addressing does not create 
an altered copy that can be redistributed to other users or to the 
public generally.
    As I understand the technology, it employs software that will 
filter what appears on a dvd player when a movie is inserted, but it 
does not alter the movie itself. I see some persuasiveness to the view 
that Representative Lofgren expressed in our Subcommittee markup that 
the technology simply assists authorized users in doing what they 
already have a right to do: namely, to view only those portions of a 
movie or a TV show that they wish to watch.
    Nonetheless, I question whether H.R. 4586 is necessary. I also 
believe that we must acknowledge that the bill contains no meaningful 
limits on the scope of permissible filtering. As a result, I believe 
that it will impinge on the artistic freedom of motion picture 
creators, weaken the rights of motion picture copyright owners, and 
raise First Amendment concerns.
    As I noted at the Subcommittee markup, if our goal is to protect 
young people from content that their parents deem objectionable, I 
believe that there are far less drastic means available to accomplish 
this.
    We know that there are versions of movies that appear on airlines 
and on television that are edited from the original work. While 
sometimes these movie versions are edited to shorten the time of the 
film or to delete the credits, they also sometimes are edited to ensure 
that content not deemed suitable for children is deleted.
    It seems clear to me that where the public, or a company like 
ClearPlay, has access to the so-called ``airplane'' or ``TV'' versions 
of movies that these versions will properly protect young people from 
potentially objectionable content.
    Thus, I continue to believe that if we are going to legislate in 
this area, where ``airplane'' or ``TV'' versions of a movie are 
licensed to a company like ClearPlay or where such versions are 
available for sale to the public, the airplane or TV version should 
represent the outer limit of permissible content editing.
    We should prevent the use of filtering software to create edited 
versions of movies that contain edits other than those included in the 
``airline'' or ``TV'' version where such a version is available to the 
public, and not permit additional filtering of the work without the 
consent of the motion picture owners and creators.
    Mr. Chairman, I am not seeking to require any movie owner to create 
an ``airline'' or ``TV'' version of any movie, nor should we require a 
movie owner to make an airline or TV version available to the public or 
to license such versions to companies like ClearPlay where such 
versions do exist.
    Mr. Chairman, I know that there is considerable controversy as to 
whether the software employed by ClearPlay violates the copyright or 
trademark laws, and my comments are not intended to express a view on 
that dispute. Yet, as I noted at our hearing on this bill, I think that 
the public would be well-served if the parties to the ClearPlay 
litigation can reach a commercial settlement of this dispute.
    I have no interest in allowing the possibility of legislation like 
this bill to be used as a club to influence settlement negotiations 
between the movie studios and ClearPlay in the federal court litigation 
pending in Colorado, or to influence any other efforts to arrive at a 
commercial resolution of this dispute. I fear that the prospect of this 
legislation is derailing meaningful settlement discussions.
    It seems as if the prospect of this legislation may have caused 
ClearPlay to raise its demands and to take certain terms off the table 
that it previously had offered. I am advised that ClearPlay is now 
asking that it be allowed to edit movies made by ``final cut'' 
directors for which no airplane or TV version is available. With regard 
to films for which TV or airplane versions are available, ClearPlay is 
now asking that it be able to make its own edits, rather than use the 
TV or airplane edits.
    Mr. Chairman, I am very concerned about preserving the rights of 
the movie studios and creative artists to protect their exclusive right 
to create derivative works based upon their copyrighted motion 
pictures. If the movie owners and the movie creators and directors can 
agree to give ClearPlay a license to exhibit ``airplane'' or ``TV'' 
versions of movies or if such versions are available to the public 
directly, the public will be very well-served. In these circumstances, 
I see no compelling reason whatsoever to create further exemptions from 
copyright and trademark law.
    I yield back the balance of my time.

    Chairman Sensenbrenner. Are there amendments? Gentleman 
from Texas, Mr. Smith, has a perfecting amendment. And the 
clerk will report the amendment.
    The Clerk. Mr. Chairman, I have two amendments.
    Chairman Sensenbrenner. This is Smith Texas 074 XML. Is 
that the right one? The clerk will report that amendment.
    The Clerk. Amendment to the amendment in the nature of a 
substitute to H.R. 4586 offered by Mr. Smith of Texas.
    [The amendment to the amendment in the nature of a 
substitute, offered by Mr. Smith of Texas, follows:]


    Chairman Sensenbrenner. Without objection, the amendment 
will be considered as read. The gentleman from Texas will be 
recognized for 5 minutes.
    Mr. Smith. I will be brief. The perfecting amendment makes 
one simple change to the Subcommittee reported bill. The 
existing bill refers in section 3 to manufacturers. The 
amendment would change such references to manufacturers, 
licensees, and licensors. This amendment would ensure that 
those who were involved in licensing the technology identified 
in this act do not also face trademark claims.
    So I urge my colleagues to support the perfecting 
amendment. And also, Mr. Chairman, I want to point out to my 
colleagues who are here today that the bill did receive 
bipartisan support as it was marked up in the Subcommittee.
    Ms. Lofgren. Would the gentleman yield? I just wanted to 
briefly comment about the bill and certainly this is a 
technical amendment. I think, and Mr. Berman's last comment 
about the use of technology to go the other direction in terms 
of content, emphasizes that really, although there has been a 
lot of discussion about the use of technology to protect 
parents, it is really about consumer rights in my judgment.
    And it seems to me that if an individual has a right not to 
watch parts of a DVD, which we all agree consumers have that 
right--you can go to the bathroom, you can go to the 
refrigerator--then it seems to me you have the right to use 
whatever technology you wish to as a tool to advance that 
right. So I think it is important to note that this technology 
does not permanently alter the underlying DVD, it has never 
changed, but it is merely a tool to allow people to watch what 
they want to watch, either enhanced so that they don't have to 
watch the nondirty parts, or to take out all the violence and 
dirty parts or whatever.
    So looking at it in that way this is just a consumer rights 
bill. And I feel very comfortable in supporting it.
    I thank the gentleman for yielding to me to say so.
    Mr. Smith. I thank the gentlelady from California for her 
comments. Mr. Chairman, I yield back.
    Chairman Sensenbrenner. Mr. Berman.
    Mr. Berman. I move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Berman. I have no objection to this amendment of a 
technical nature. I am not asking people to oppose this 
amendment. I just want to respond that were there a company to 
develop a software that enabled parents or consumers to develop 
filters to exclude items they wanted to, we would be talking 
about something very different. But this is not what this 
legislation authorizes and purports to legalize.
    And again I simply go back to the fact that things which 
empower consumers are very different than things which 
substitute for consumers' judgment with a product owned by 
somebody else so that their trademark and their copyright is 
changed. And the fact that this doesn't touch--if ever I heard 
of a distinction without a difference, the fact that this is a 
filter that makes imperceptible that which comes off of the DVD 
as opposed to altering the DVD to me is a distinction without a 
difference. They are changing what the creator of that work 
intended. I think that they should be working with that creator 
and that copyright owner to provide a licensed version of those 
things when they are in the business of making a profit by 
producing and distributing and selling these filters.
    I yield back.
    Chairman Sensenbrenner. The question is on the amendment to 
the amendment in the nature of a substitute offered by the 
gentleman from Texas, Mr. Smith.
    Those in favor will say aye.
    Opposed, no.
    The ayes appear to have it. Ayes have it. The amendment is 
agreed to.
    Further amendments? The gentleman from California Mr. 
Schiff.
    Mr. Schiff. I have two amendments at the desk. If I could 
take up the first, 110.
    Chairman Sensenbrenner. The clerk will report Schiff 110.
    The Clerk. Amendment to the amendment in the nature of a 
substitute to H.R. 4586 offered by Mr. Schiff. Page 1, line 15, 
strike ``limited'' and insert ``profane, sexual or violent.'' 
page 2, line 22, strike ``limited'' and insert ``profane, 
sexual, or violent.''
    [The amendment to the amendment in the nature of a 
substitute, offered by Mr. Schiff, follows:]


    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Schiff. I thank the Chairman. Before I go to the 
merits, I wanted to join my colleague from California, Mr. 
Berman, in his remarks. This bill is really not about parents 
having editorial discretion over the films that their children 
see, but rather whether one private company or a series of 
private technology makers should have the unrestricted ability 
to edit someone else's work product and put it into the market, 
edit it in any way they like without having, as they are 
required under current law, to negotiate those rights with the 
developer of the content.
    This is, in just a different forum, one of the many 
disputes between the technology makers and the makers of 
content about who want to control that content. That is really 
what is at the heart of the bill. I think this amendment lays 
bare what this bill is really about. Because in sum what this 
amendment does is ensure that the protections provided by the 
legislation would only be extended to technology that is aimed 
at protecting viewers from profane, sexual, or violent content.
    This amendment was offered by Mr. Berman in Subcommittee. 
And as has been pointed out, while the proponents of the 
underlying bill have indicated that their goal is to provide 
filters that would sanitize movies of sex, violence, and 
profanity, the current bill is not drafted to limit its 
provisions to such edits; rather, the bill would legalize a far 
wider and unbridled universe of filtering to either increase 
profane, violent, and sexual content or decrease it.
    This legislation would provide a safe harbor to a company 
that proactively markets this product as a means of isolating 
sexual content for the viewer, as has been indicated by my 
colleague from California. And I sincerely doubt the proponents 
of this legislation intend to do that, but that is the effect.
    So this amendment would ensure that Congress is not 
promoting unintended consequences providing licenses to those 
that make filters that are less desirable. And since the 
amendment really goes precisely at what the proponents say they 
want to accomplish, I can only assume if they oppose the 
amendment that their goal is something different, that their 
goal is not really to limit the violence, the sexual, the 
profane, but rather to give a competitive economic advantage to 
some technology makers over other technology makers, to all 
technology makers over content makers, because what the 
technology makers seek to do they are capable of doing through 
negotiation. And currently those negotiations are going on.
    But if Congress steps in and changes the playing field, it 
obviously advantages some of the technology makers vis-a-vis 
others. But if our goal really is to limit this to protecting 
minors, to empower parents, this amendment goes right to the 
heart of what the proponents seek to do. And I think it will be 
apparent based on the support for this amendment or its 
opposition what is really at stake here.
    And I would urge all my colleagues to support this limiting 
language. I would yield back the balance of my time.
    Chairman Sensenbrenner. Mr. Smith.
    Mr. Smith. Mr. Chairman, we dealt with this amendment in 
Subcommittee, but I am happy to register my objection to it 
again. The Family Movie Act is not about just profane, sexual, 
or violent content, it is about the right of parents to decide 
what their children see. Parents may choose to skip over or 
mute anything they want to, quite frankly. It might be profane, 
sexual or violent content, but they might also choose to mute 
or skip over other content that they find objectionable. This 
content, for example, could include drug use that a parent does 
not want their teenager to watch, or it could simply be a scary 
part of a movie that an 8-year-old will get nightmares from. In 
other words, it is not just limited to the profane or the sex 
or the violence. Whatever the content depicted on the screen, 
parents should have a right to use a remote control to mute or 
skip over it or use technology to accomplish the very same 
thing.
    I urge my colleagues to oppose the amendment.
    Mr. Cannon. Would the gentleman yield?
    Mr. Smith. I would be happy to.
    Mr. Cannon. This, of course, has been a very interesting 
issue to me, since I represented all of the defendants in 
litigation between the studios and directors on the one hand, 
and the producers of innovation and technology that allows 
people a great deal more freedom as they look at Hollywood's 
otherwise admirable products. But I have a concern that is very 
important to me. We have in that lawsuit a number of 
technologies and theories of law. I am wondering if the 
gentleman from Texas could comment on the implications of this 
bill for other theories of law that are represented in that 
lawsuit. In other words, when the lawyers for the studios and 
the directors stand up and argue what we do here today, will 
that have an effect on that lawsuit, or do you see it as 
independent, maybe establishing some principles but not 
jeopardizing other arguments or issues?
    Mr. Smith. Would the gentleman yield? I envision this 
legislation as being independent both from lawsuits and from 
any specific technology, if that reassures the gentleman. And 
one reason for this legislation is that, quite frankly, we 
don't know what a specific court in a specific State is going 
to do. What we want to do here is make sure that parents, in 
whatever State they live, have the right to mute or skip over 
certain material that they consider to be offensive and not in 
the best interest of their children.
    Does that help the gentleman?
    Mr. Cannon. I thank the gentleman.
    Mr. Berman. Mr. Chairman.
    Chairman Sensenbrenner. The gentleman from California, Mr. 
Berman.
    Mr. Berman. Mr. Chairman, I obviously support the 
gentleman's amendment. Only two comments I want to make. One, 
in presenting the bill, this is about presenting--allowing 
parents, empowering parents to prevent children from seeing 
inappropriate violence, hearing inappropriate profanity, 
viewing inappropriate sexual content.
    Mr. Schiff offers an amendment and now it is about 
empowering parents to filter any item, including items that 
don't fit into those categories for children. When we offer an 
amendment that says all right, let's just allow this for when 
the parents are using filters to show it to the children, this 
is not about just parents showing it to the children.
    Why with all the rhetoric, why don't we just go right to 
the gentleman from California's point; they think it is a 
consumer right to have a commercial company create its own 
filters which are then sold to change, fundamentally in many 
cases, either in a pornographic enhancing or a pornographic 
reducing way or in any other way, the product of an artistic 
creation owned by somebody else.
    The second point I want to make is the comment that this is 
technology neutral. Just read the bill. This only purports to 
authorize one type of technology, a technology by means--it is 
a technology, if you look at the bill, the making--which allows 
the making of limited portions of audio or video content 
imperceptible by or for the owner or other lawful possessor, 
for private use in a household, although that may be changed by 
a subsequent amendment that the gentleman may offer, which are 
operated by an individual in that household, serve only such 
household, do not create a fixed copy of the altered version.
    If you create a fixed copy of the altered version, then 
this technology--that technology is not permitted. This bill is 
not technology neutral. This favors the ClearPlay-type 
technology, not technologies which alter, mutilate, splice, or 
whatever dice means, in the context of this. It is not a 
technology neutral proposal.
    Mr. Schiff. Would the gentleman yield? I wonder if I might 
pose a question to the gentleman from Texas that how far he 
thinks this legislation or other ought to go. Should purchasers 
of the technology be able to use it to edit a film to change 
the ending of a film?
    Mr. Smith. Would the gentleman yield? Let me repeat a 
couple of things that I thought I had made clear but apparently 
did not. First of all, I feel that parents should be able to 
use the technology to skip over anything that they deem 
offensive. If they want to skip the ending of a movie, even 
though someone else might consider it to be crucial, I think 
that is the right of the parents.
    So to follow upon what Mr. Berman just said, we have given 
examples of sex, violence, and profanity, but I made clear from 
the very beginning those are just the most egregious examples. 
I gave an example of a parent not wanting to see drug dealing, 
for example.
    So all the examples that you all might come up with are 
really red herrings or straw men or distractions to get us away 
from the real issue to me, which is the right of parents, the 
right of consumers, even in Ms. Lofgren's words, to use 
technology that we might have done--it might have been manual a 
generation ago, it might be by remote control in other year or 
two--but to use technology to skip over anything they deem 
offensive in the privacy of their own home.
    We are not talking about changing permanently the film or 
the DVD or the VCR. We are not talking about selling it for 
profit. We are not talking about commercializing it. We are 
talking about the right of parents to do what they want to do 
with the VCR in their own home.
    Mr. Berman. I yield to the gentleman from Massachusetts.
    Mr. Delahunt. I was just simply going to ask the Ranking 
Member Mr. Berman here, aren't there other technologies that 
are in existence at this moment in time that do exactly what 
the gentleman from Texas wishes to do?
    Mr. Berman. V-chips, remote controls, mute buttons, fast-
forward buttons.
    Mr. Delahunt. Is that why the----
    Mr. Berman. And other--and technologies which empower the 
parent--although I know it is not just the parent--but the 
parent to create their own filters to show movies.
    Chairman Sensenbrenner. The time of the gentleman has 
expired.
    Mr. Delahunt. Mr. Chairman.
    Chairman Sensenbrenner. The gentleman from Massachusetts.
    Mr. Delahunt. Move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Delahunt. I yield whatever time Mr. Berman needs to 
complete the point that he was making.
    Mr. Berman. On the theory that it is a point that I have 
already made, I will not make it again.
    Chairman Sensenbrenner. That is appreciated.
    Mr. Berman. At this moment.
    Mr. Delahunt. Again, I would just make the observation that 
I think it is rather clear that in the exchange between Mr. 
Smith and Mr. Berman and Mr. Schiff, and I applaud the 
gentleman for his amendment, I think it really does clarify for 
us this is really not--and I think we should be clear--this is 
not about violence, this is not about profanity, this is not 
about inappropriate sexual scenes, this is about a technology 
that will be provided a particular commercial advantage. That 
is what I see this to be. And I think it is absolutely 
inappropriate.
    And for those that have concerns about children viewing 
sex, violence, et cetera, any kind of unacceptable behavior, 
there are technologies that are in existence right now. We as a 
Committee are intruding ourselves into litigation. Yes, I 
understand the gentleman's point regarding that it would not be 
used in the sense of a particular discrete lawsuit; however, 
let's not kid ourselves. The parties to that particular 
litigation are waiting for action and it does create a certain 
leverage for Clear Channel in terms of the negotiations, 
because I presume that at some point in time reasonable people 
will work out an agreement and a settlement will be affected.
    Mr. Cannon. Would the gentleman yield?
    Thank you. We actually agree on a point here. I believe 
this bill gives a technological advantage; at least it makes 
clear that one technology is appropriate. I would like to make 
clear for the record that doing so doesn't--I think the 
gentleman from California was suggesting that there may be some 
rationale here for application of this theory as limiting the 
theories of law that the other, in this case plaintiffs, those 
people who are being sued by the directors and the studios 
have; that is, as I review this, I believe that this bill only 
adds protection to a particular technology and does nothing to 
undermine the theories of the case of the other plaintiffs with 
other technologies. And I would like to know if the gentleman 
from California, or Mr. Delahunt, you believe anything other 
than that.
    Mr. Delahunt. Reclaiming my time, I agree with the 
gentleman from Utah. This is all about, in my opinion, 
providing leverage for negotiations to secure a settlement. It 
has nothing to do with the outcome of legislation.
    Mr. Berman. Would the gentleman yield?
    Mr. Delahunt. Yield to the Ranking Member.
    Mr. Berman. Taking up a theme that the gentleman said 
earlier and the gentleman from California implied, I guess when 
you say it is about sex, violence, and profanity, it is really 
about the money. It does create an implication, I suggest, 
because the Register of Copyrights says for the copyright 
purposes you really don't need this bill, because a fixed copy 
isn't created through this filter and therefore it doesn't 
violate copyright now.
    Now, that is not a comment on the facts of the particular 
litigation and the Register acknowledges she hasn't seen the 
evidence that is being presented in that case. But when you 
have a bill that says do not create a fixed copy of the altered 
version, it certainly leaves an implication that if you do 
create a fixed copy, you are in bad shape. And so I would argue 
that by clear implication from the language of this bill, 
people with other kinds of technologies that don't meet the 
test of this bill, are in high risk.
    Mr. Smith. Would the gentleman yield?
    I certainly agree with Mr. Berman if we were to tamper with 
or alter permanently with the disc, that would be a copyright 
violation. But just for your sake, I think the record ought to 
be accurate. A while ago you mentioned Clear Channel instead of 
ClearPlay. That happens to be a constituent firm, and I 
wouldn't want to involve them in the this debate.
    Chairman Sensenbrenner. The gentleman's time has expired. 
The question is on the adoption of the amendment by the 
gentleman from California, Mr. Schiff.
    Those in favor will say aye.
    Opposed, no.
    The noes appear to have. The noes have it. The amendment is 
not agreed to.
    Are there further amendments?
    Mr. Schiff. I have a further amendment at the desk.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    [The amendment to the amendment in the nature of a 
substitute, offered by Mr. Schiff, follows:]


    The Clerk. Amendment to the amendment in the nature of a 
substitute to H.R. 4586 offered by Mr. Schiff. Add at the end 
the following: Section 5----
    Chairman Sensenbrenner. Without objection, the amendment is 
considered as read. The gentleman from California will be 
recognized for 5 minutes.
    Mr. Schiff. Mr. Chairman, this is a simple but important 
amendment that would provide a 3-year sunset for the 
legislation. As has already been pointed out the Register of 
Copyrights testified at the Subcommittee that the issues 
touched upon in this legislation are currently in the middle of 
litigation and negotiation, litigation addressing whether the 
manufacture and distribution of such technology violates the 
copyright law. And the Lanham Act is in Federal court with a 
summary judgment motion still pending.
    The parties to the pending litigation include the 
commercial providers of various movie filters available, the 
movie studies that own the copyrights, and the directors who 
are legitimately concerned about their rights as creators. But 
more importantly and perhaps more promising, are the serious 
ongoing negotiations that have been occurring between the 
individual studios and technology providers aimed at resolving 
this dispute through mutually acceptable licensing agreements. 
Indications are that those negotiations have progressed 
substantially well. However, this legislation will surely bring 
these negotiations to a complete halt.
    By supporting a 3-year sunset, Congress will be sending a 
clear message that negotiations should still be taken 
seriously. My colleagues on the other side of the aisle have 
often urged us to permit the marketplace to resolve a host of 
issues. This amendment would do just that. If we provide a 
small incentive to the studios and technology providers to work 
something out over the next 3 years, a permanent exemption is 
not needed.
    This amendment would also ensure that Congress can revisit 
this issue to make sure there are no unintended consequences. 
As we have already heard, the legislation would currently 
potentially provide a safe harbor to a company which markets 
its product as a means of isolating and enhancing sexual 
content for the viewer. And I doubt the proponents of 
legislation intended to promote that. It will ensure that 
Congress can come back and determine whether this legislation 
has indeed had such unintended consequences.
    I would urge my colleagues' support.
    Chairman Sensenbrenner. The gentleman from Texas, Mr. 
Smith.
    Mr. Smith. I oppose the amendment.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Smith. The issue before us today is still what right do 
parents have to control what their families see in the privacy 
of their own home. If we think that parents should have such 
right, there is no justification for limiting those rights. Are 
we saying that parents can only protect their children for 3 
years? Parents have a moral right and in fact a legal 
responsibility to protect their children from offensive 
material. Most parents remain heavily involved in the lives of 
their children. Why should we limit parental rights to only the 
next 3 years?
    The Register of Copyrights has already testified that what 
one of these companies is doing is legal, not that they are 
only legal for a certain number of years. This amendment seems 
to ignore the Register's testimony. Also, Mr. Chairman, I don't 
know of a single precedent by this full Committee where we have 
limited or attempted to limit any right. And I don't think we 
should start to by limiting the right of parents to only 3 
years.
    So I would encourage my colleagues to oppose this 
amendment. I yield back.
    Chairman Sensenbrenner. The gentlelady from Texas, Ms. 
Jackson Lee.
    Ms. Jackson Lee. I thank the Chairman. I would like to 
strike the requisite number of worlds.
    Chairman Sensenbrenner. The gentlelady is recognized for 5 
minutes.
    Ms. Jackson Lee. I will add my comments to incorporate Mr. 
Schiff previous amendment which was defeated--I thought that 
was certainly an effort of reasonable compromise--and then, of 
course, to add my comments on the present amendment that speaks 
to this question of a limitation, and combine it with my 
concern for the broadness of this legislation and to indicate 
that in the past I have been frankly welcoming a legislation 
that deals with the prohibition of obscenity and other untoward 
activities that might impact children. But in this instance, I 
think there are several points that would undermine this 
legislation at this point.
    One, there is ongoing litigation that may have an alternate 
viewpoint. Of course, here we go again. We are trying to thwart 
the third branch of government. That will be occurring in the 
next 48 hours as we debate legislation on the Marriage 
Protection Act. We now want to close the door prematurely and 
interfere with ongoing litigation.
    Secondarily, I think it is noted that we voted in this 
Committee, some of us, on the V-chip which has been working for 
a number of years.
    And then I want to take my good friend up on his question 
of morality, my good friend from Texas. He is absolutely right. 
It is a question of morality. What we have heard so often is 
that it is a question of parents being parents. Some of us who 
are parents realize that those are very challenging 
responsibilities. But parents have the opportunity to sit down 
with their children and be selective of what is on and what is 
not.
    The interesting point about this, of course, is that this 
is an economically biased legislative initiative. The poor 
parents who can't afford this technology will have their 
household, I assume, filled up with these bad movies, if you 
will, leave them to, I guess, their religious views and their 
morality. But the rich folks can go off to the Hamptons and 
leave the kids in front of sophisticated technology.
    Well, I believe in equal opportunity. Let all parents be 
parents, poor people, middle-class people, and rich people. 
Leave the technology alone and sit down and tell your kids what 
to look at, or turn the TV off, or sit down with them and 
discuss the issue.
    My concern was there was nudity in ``Schindler's List,'' 
nude bodies. Are you suggesting there is nothing wrong with 
that? There was interracial relationships in Spike Lee's 
``Jungle Fever.'' it is all a matter of taste and it is all a 
matter of having a family member sit down and deal with their 
children. Some of us have been perfect and imperfect. But it is 
our responsibility. We can be aided by certain tools, and I 
think the V-chip is reasonable. But I would argue at this 
point, with ongoing litigation, the fact that this is a 
purchased item and therefore some will get it and some won't, I 
just think at this point we need further facts and further 
study before we support this particular legislation.
    But I would support both amendments, one that has been 
defeated, but I rise in support of Mr. Schiff's amendment. I 
yield back my time.
    Chairman Sensenbrenner. Question is on the second Schiff 
amendment.
    Those in favor will say aye.
    Opposed, no.
    Noes appear to have it. Noes have it. And the amendment is 
not agreed to.
    Are there further amendments? The gentleman from Virginia, 
Mr. Scott.
    Mr. Scott. Move to strike the last word.
    Chairman Sensenbrenner. The gentleman is recognized.
    Mr. Scott. I would like to ask the gentleman from 
California a couple of questions to make sure I understand 
this. This machine that we are allowing to be used is not 
content neutral like a VCR or cassette tape, it is movie-
specific, where would you have to buy a subscription to a 
specific movie for this thing to work; that is to say, you 
can't view the altered version without paying somebody some 
money for that specific movie. Is that right?
    Mr. Berman. Close to right. Here, what you are doing is 
buying a filter, one of a number of filters in the case of 
ClearPlay, that are offered for a specific film that will be 
used when you show that film, it will be used on your machine, 
on your DVD player, and which will then filter out what some 
employees at ClearPlay decided should be filtered out. So it is 
you buy filters for a specific movie. It is not film neutral. 
It does not edit out certain words or certain scenes from all 
movies. It is movie specific.
    Mr. Scott. To get this movie after this altered version 
software, I buy the movie, and then have to pay someone a 
subscription fee or money to get this altered software, movie 
specific.
    Mr. Berman. That is right. A subscription I think that is 
actually--that is maybe their business model, subscriptions to 
choose which filters for which movies that we have decided we 
should create filters for and what--the kinds of things that 
our employees are filtering.
    Mr. Scott. Obviously you have trademark implications if you 
are selling a product which will show a version of a movie and 
the people that produce the movie don't get a cut of the 
action.
    Mr. Berman. That is exactly right.
    Mr. Scott. Now, does the pending litigation--would the 
outcome of the pending litigation solve this question?
    Mr. Berman. Yes. The pending litigation would solve--it 
would either say this kind of filtering system does not violate 
copyright law, does not violate the Lanham Act trademark law, 
or it does. And if it was concluded that it does, than perhaps 
we would want to consider--then debate the merits of whether 
they should be allowed and we should exempt and under what 
conditions we should exempt this kind of technology from 
copyright law and trademark law.
    Ms. Lofgren. Would the gentleman yield? I think it is 
important to clarify that the person who makes the movie, the 
DVD, is compensated; because in order to play the movie using 
the technology, you either have to buy the DVD or rent the DVD. 
So that doesn't change. It is just how you watch it that 
changes. I thank the gentleman.
    Mr. Scott. I would ask--but to view the different version, 
you would have to buy the DVD; but if for some reason you 
wouldn't buy it unless you could have the enhancement, movie-
specific enhancement so it would be ``Training Day'' without 
cuss words, the without-cuss-words edition, you would have to 
pay extra for, and the people who made ``Training Day'' would 
not have the editorial decision as to what gets cut out and 
what doesn't and they would get no cut of additional money.
    Ms. Lofgren. That is correct. If you used your remote to 
skip over the parts, or if you went to the refrigerator to get 
a beer while they were doing the dirty words, no one would get 
a cut of the beer for the altered version.
    Mr. Scott. But you didn't have to pay for the use of the 
remote control in the VCR.
    Mr. Berman. You have to pay for the beer but you don't have 
to otherwise pay to go to the refrigerator. The fact is that 
altered forms of films are a revenue stream for copyright 
owners. And that is why there is a market for films for 
airplanes, films for television, and in some cases, by the way, 
original cuts for DVDs that aren't shown in the theater. Each 
one of those produce revenue streams for the copyright owners 
and the creators.
    And under the collective bargaining agreements, the 
copyright owners must consult with the creators before they 
make those, so both as to how it is edited and the revenue 
stream, copyright owners traditionally recover additional 
monies for that altered version.
    Chairman Sensenbrenner. The time of the gentleman has 
expired. Are there further amendments?
    For what purpose does the gentleman from California seek 
recognition?
    Mr. Berman. I have an amendment at the desk, amendment 
number 2.
    Chairman Sensenbrenner. The clerk will report the 
amendment.
    The Clerk. Amendment to the amendment in the nature of a 
substitute to H.R. 4586 offered by Mr. Berman.
    Page 1, line 15, after----
    [The amendment to the amendment in the nature of a 
substitute, offered by Mr. Berman, follows:]


    Chairman Sensenbrenner. Without objection, the amendment is 
considered as read. The gentleman from California will be 
recognized for 5 minutes.
    Mr. Berman. Thank you, Mr. Chairman.
    H.R. 4586 limits the copyright and trademark rights of 
movie producers and directors, provides them no compensation or 
royalties for those statutory limitations of their rights. It 
was just pointed out in the dialogue that the gentleman from 
Virginia undertook with Ms. Lofgren and myself.
    The stated justification for these limitations on copyright 
and trademark rights is to ensure parental access to 
technological tools that filter objectionable content in motion 
pictures. My amendment will advance these goals in much the 
same way. It requires the manufacturers of these filtering 
technologies to offer competitors royalty-free licenses to 
their technology in order to get the protection from liability 
provided by H.R. 4586.
    This amendment will ensure the most widespread 
dissemination of filtering technologies to parents. It will 
ensure the best technologies available from a wide variety of 
vendors. If will ensure that parents will not have to pay 
monopoly prices for access to that technology. I think my 
amendment is fair. And if it is fair to limit the intellectual 
property rights associated with movies in order to benefit 
parents, then it is fair to the intellectual property rights of 
the filtering companies who are filtering without the consent 
of the copyright owners and without compensating them in order 
to benefit parents. If it is fair to provide movie copyright 
and trademark holders with no royalties in exchange for the 
loss of their rights, then filtering companies should likewise 
expect no royalties for a similar loss. That is my amendment.
    Mr. Schiff. I would like to say to my colleague from 
California, this is a brilliant amendment. It is very much a 
consumer----
    Mr. Berman. I didn't think of it.
    Mr. Schiff. It is very much a consumer rights amendment. It 
expands the benefits for the consumers that the proponents of 
the underlying bill purport to be concerned about.
    And I do have one question about both the amendment and the 
underlying bill, and that is, does the underlying bill permit, 
for example, one of the makers of this filter technology to 
advertise, buy a filter for ``The Terminator'' and you can 
change ``The Terminator'' in this way, or buy a filter for this 
movie and basically use the names, use the likenesses, use the 
subscription of the films without ever having to compensate the 
film makers?
    Mr. Berman. It certainly would, unless this bill is amended 
to strip that right from these people. And in addition, it 
contains a provision prohibiting Federal courts from hearing 
first amendment cases. No, it would certainly allow that.
    Chairman Sensenbrenner. Does the gentleman yield back?
    Mr. Berman. Yes.
    Chairman Sensenbrenner. The Chair recognizes the gentleman 
from Texas, Mr. Terminator.
    Mr. Smith. Thank you, Mr. Chairman. I oppose the amendment.
    Chairman Sensenbrenner. The gentleman is recognized for 5 
minutes.
    Mr. Smith. I really do have some difficulty understanding 
the reasoning behind the amendment. It seems to say----
    Mr. Berman. Would the gentleman yield? I would like to 
repeat the reasoning.
    Mr. Smith. It seems to say that American intellectual 
property laws that allow directors and studios to profit from 
their work for 95 years do not apply to those who create other 
forms of intellectual property. I recognize that some in 
Hollywood disagree with what companies like ClearPlay and 
others are doing, and that is certainly their right. But should 
we then stop such companies from offering their technology to 
interested parents by legislating a taking of a company's 
intellectual property?
    I have not seen any justification as to why this Committee 
should legislate the taking of someone else's intellectual 
property simply because someone in Hollywood doesn't like them. 
What is good for the goose is good for the gander. Perhaps we 
should require movie studios to offer free licenses to all who 
want to watch their movies because some people this country 
don't like the movies made in Hollywood. I urge my colleagues 
to oppose the amendment.
    Chairman Sensenbrenner. The gentleman from Michigan, Mr. 
Conyers.
    Mr. Conyers. I would like to observe that on a Committee of 
37 men and women, all but four of whom are lawyers, how we 
could be taking a matter that has been filed in a Federal court 
since August 2002--and we know that negotiations are ongoing--
and passed a law dealing with the specific issues that are in 
the litigation is beyond me. Can any Member in this case 
explain to me why we are doing this? This is so exceptional 
that I would seek an explanation if there is one. And I would 
yield to anyone.
    Mr. Berman. Thank you, John.
    My friend, the Chairman of the Subcommittee's point, you 
made my point. I view this bill as a taking. This is not simply 
about what is cut, what is obliterated from the creator's work, 
it is about whether the creator is entitled to any stream of 
revenue for the altered version of his work. And you will--I am 
saying if it is good for the goose, it is good for the gander. 
If you are going to have a taking of the creator's artistic 
rights and the copyright owner's rights, then let's have a 
compulsory royalty-free license for the creators of this 
technology, because our goal is to protect the children.
    Chairman Sensenbrenner. The question is on the Berman 
amendment to the amendment in the nature of a substitute.
    Those in favor will say aye.
    Opposed, no.
    Noes appear to have it. Noes have it. The amendment amount 
is not agreed to.
    Mr. Berman. Move to strike the last word.
    Chairman Sensenbrenner. We are running out of time.
    Mr. Berman. I am going to have raise one issue. Then we 
will go to a vote.
    The Chairman. The gentleman is recognized for 5 minutes.
    Mr. Berman. Thank you, Mr. Chairman. There is a concern 
that hasn't been raised by any amendment, that I will not offer 
as an amendment, that while this is entitled the Family Movie 
Act, it covers more than movies, could cover live over-the-air 
television programming, and that it immunizes from liability 
companies that manufacture technology to edit TV programs, 
including commercial stripping.
    In other words, this might, this bill might well legalize 
the elimination of a fairly common business model, which is 
over-the-air commercial television. And without trying to 
debate that issue now, I am just wondering if the Chairman 
might be willing to consider working through this issue to see 
if--what his intent would be with respect to that possibility.
    Chairman Sensenbrenner. Would the gentleman yield?
    The answer is yes, we will in work to consider this, with 
no promises being made as to a result.
    Mr. Berman. Well, that is quite an offer. Maybe I can keep 
you engaged.
    Chairman Sensenbrenner. The Chair is always happy to be 
engaged with the gentleman from California.
    If there are no further amendments, without objection, the 
Subcommittee amendment in the nature of the substitute laid 
down as the base text is amended as adopted. A reporting quorum 
is present.
    The question occurs on the motion to report the bill, H.R. 
4586, favorably, as amended.
    All in favor will say aye.
    Opposed, no.
    Ayes appear to have it.
    Mr. Berman. rollcall.
    Chairman Sensenbrenner. A rollcall is ordered. Those in 
favor of reporting the bill favorably, as amended, will answer 
aye. Those opposed will answer no.
    The Clerk. Mr. Hyde.
    [No response.]
    The Clerk. Mr. Coble.
    Mr. Coble. Aye.
    The Clerk. Mr. Coble, aye.
    Mr. Smith.
    Mr. Smith. Aye.
    The Clerk. Mr. Smith, aye.
    Mr. Gallegly.
    Mr. Gallegly. Aye.
    The Clerk. Mr. Gallegly, aye.
    Mr. Goodlatte.
    Mr. Goodlatte. Aye.
    The Clerk. Mr. Goodlatte, aye.
    Mr. Chabot.
    Mr. Chabot. Aye.
    The Clerk. Mr. Chabot, aye.
    Mr. Jenkins.
    Mr. Jenkins. Aye.
    The Clerk. Mr. Jenkins, aye.
    Mr. Cannon.
    Mr. Cannon. Aye.
    The Clerk. Mr. Cannon, aye.
    Mr. Bachus.
    [No response.]
    The Clerk. Mr. Hostettler.
    [No response.]
    The Clerk. Mr. Green.
    Mr. Green. Aye.
    The Clerk. Mr. Green, aye.
    Mr. Keller.
    Mr. Keller. Aye.
    The Clerk. Mr. Keller, aye.
    Ms. Hart.
    Ms. Hart. Aye.
    The Clerk. Ms. Hart, aye.
    Mr. Flake.
    [No response.]
    The Clerk. Mr. Pence.
    [No response.]
    The Clerk. Mr. Forbes.
    Mr. Forbes. Aye.
    The Clerk. Mr. Forbes, aye.
    Mr. King.
    Mr. King. Aye.
    The Clerk. Mr. King, aye.
    Mr. Carter.
    Mr. Carter. Aye.
    The Clerk. Mr. Carter, aye.
    Mr. Feeney.
    Mr. Feeney. Aye.
    The Clerk. Mr. Feeney, aye.
    Mrs. Blackburn.
    Mrs. Blackburn. Aye.
    The Clerk. Mrs. Blackburn, aye.
    Mr. Conyers.
    Mr. Conyers. No.
    The Clerk. Mr. Conyers, no.
    Mr. Berman.
    Mr. Berman. No.
    The Clerk. Mr. Berman, no.
    Mr. Boucher.
    [No response.]
    The Clerk. Mr. Nadler.
    [No response.]
    The Clerk. Mr. Scott.
    Mr. Scott. No.
    The Clerk. Mr. Scott, no.
    Mr. Watt.
    Mr. Watt. Pass.
    The Clerk. Mr. Watt, pass.
    Ms. Lofgren.
    Ms. Lofgren. Aye.
    The Clerk. Ms. Lofgren, aye.
    Ms. Jackson Lee.
    Ms. Jackson Lee. No.
    The Clerk. Ms. Jackson Lee, no.
    Ms. Waters.
    Ms. Waters. No.
    The Clerk. Ms. Waters, no.
    Mr. Meehan.
    [No response.]
    The Clerk. Mr. Delahunt.
    [No response.]
    The Clerk. Mr. Wexler.
    [No response.]
    The Clerk. Ms. Baldwin.
    Ms. Baldwin. No.
    The Clerk. Ms. Baldwin, no.
    Mr. Weiner.
    [No response.]
    The Clerk. Mr. Schiff.
    Mr. Schiff. No.
    The Clerk. Mr. Schiff, no.
    Ms. Sanchez.
    Ms. Sanchez. No.
    The Clerk. Ms. Sanchez, no.
    Mr. Chairman.
    Chairman Sensenbrenner. Aye.
    The Clerk. Mr. Chairman, aye.
    Chairman Sensenbrenner. Members in the chamber who wish to 
cast or change their vote? If not, the clerk will report.
    The gentleman from North Carolina, Mr. Watt.
    Mr. Watt. No.
    The Clerk. Mr. Watt, no.
    Chairman Sensenbrenner. The gentleman from Indiana, Mr. 
Hostettler.
    Mr. Hostettler. Aye.
    The Clerk. Mr. Hostettler, aye.
    The Clerk. There are 18 ayes, and 9 noes.
    Chairman Sensenbrenner. The motion to report favorably, as 
amended, is agreed to. Without objection, the bill will be 
reported favorably to the House in the form of a single 
amendment in the nature of a substitute incorporating the 
amendments adopted here today.
    Without objection, the Chairman is authorized to go to 
conference pursuant to House rules. Without objection, the 
staff is directed to make any technical and conforming changes.
    All Members will be given 2 days as provided by House rules 
in which to submit additional dissenting, supplemental, or 
minority views.
    The purpose for which this meeting has been called having 
been accomplished, the Committee stands adjourned.
    [Whereupon, at 12:00 p.m., the Committee was adjourned.]
                            Dissenting Views

    We strongly oppose H.R. 4586, the ``Family Movie Act of 
2004.'' With the purported goal of sanitizing undesired content 
in motion pictures, H.R. 4586 immunizes from copyright and 
trademark liability any for-profit companies that develop 
movie-editing software to make content imperceptible without 
permission from the movies' creators.\1\ H.R. 4586 takes sides 
in a private lawsuit, interferes with marketplace negotiations, 
fails to achieve its goal, is unnecessary and overbroad, may 
increase the level of undesired content, and impinges on 
artistic freedom and rights.
---------------------------------------------------------------------------
    \1\ H.R. 4586, the ``Family Movie Act of 2004,'' 108th Cong., 2d 
Sess. (2004). The bill's proponents refer to movies that have been 
sanitized of what they consider to be offensive content as ``family 
friendly.''
---------------------------------------------------------------------------
    The bill's proponents would have us believe that this bill 
is about whether children should be forced to watch undesired 
content, but it is not. The issue in this debate is who should 
make editorial decisions about what movie content children see: 
parents or a for-profit company. Supporters of H.R. 4586 
believe companies should be allowed to do the editing for 
profit, and without permission of film creators, while 
opponents believe parents are the best qualified to know what 
their children should not see. The legislation would accomplish 
little beyond inflaming the debate over indecent content in 
popular media and interfering with marketplace solutions to 
parental concerns.
    That is why H.R. 4586 is opposed by: (1) entities concerned 
with the intellectual property and artistic rights of creators, 
including the Directors Guild of America,\2\ the Motion Picture 
Association of America,\3\ and the Dean of the UCLA Film 
School; \4\ and (2) experts on copyright law, such as the 
Register of Copyrights.\5\
---------------------------------------------------------------------------
    \2\ See Derivative Rights, Moral Rights, and Movie Filtering 
Technology: Hearing Before the Subcomm. on Courts, the Internet, and 
Intellectual Property of the House Comm. on the Judiciary, 108th Cong., 
2d Sess. 86 (May 20, 2004) (written statement of Taylor Hackford, 
Directors Guild of America) [hereinafter May 20, 2004 Hearing].
    \3\ Family Movie Act of 2004: Hearing on H.R. 4586 Before the 
Subcomm. on Courts, the Internet, and Intellectual Property of the 
House Comm. on the Judiciary, 108th Cong., 2d Sess. 67-70 (June 17, 
2004) (statement of Jack Valenti, President and Chief Executive 
Officer, Motion Picture Ass'n of America) [hereinafter H.R. 4586 
Hearing]
    \4\ Declaration of Dean Robert Rosen In Support of the Director 
Parties' Opposition to ClearPlay, Inc.'s, Trilogy Studios, Inc.'s, and 
Family Shield Technologies, LLC's Motion for Summary Judgment, Huntsman 
v. Soderbergh (D. Colo.) (02-M-1662) [hereinafter Rosen Decl.].
    \5\ H.R. 4586 Hearing at 6 (statement of Marybeth Peters, Register 
of Copyrights).
---------------------------------------------------------------------------

  A. H.R. 4586 WOULD IMPROPERLY INTERFERE WITH PENDING LITIGATION AND 
  PREMATURELY TERMINATE MARKETPLACE NEGOTIATIONS TO SETTLE THE DISPUTE

    As a preliminary matter, the legislation is inappropriate 
because it not only addresses the primary issues in a pending 
lawsuit but also takes sides with one of the parties to that 
suit. The U.S. District Court for the District of Colorado 
currently has before it a case that began as an action brought 
by a company called Clean Flicks against directors of 
movies.\6\ Clean Flicks sought a declaratory judgment against 
several directors that its business practice of providing 
edited versions of movies to consumers does not violate the 
rights of those who own the copyrights and trademarks for the 
original movies.\7\
---------------------------------------------------------------------------
    \6\ Huntsman v. Soderbergh, No. 02-M-1662 (D. Colo. filed Aug. 29, 
2002). The parties are awaiting a ruling on a motion for summary 
judgment.
    \7\ Complaint and Jury Demand, Huntsman v. Soderbergh (D. Colo.) 
(No. 02-M-1662).
---------------------------------------------------------------------------
    In the course of litigation, the number of parties 
expanded. Because Clean Flicks claimed that its conduct was 
lawful under the Copyright Act, the directors sought to join 
the movie studios in the dispute. In addition, a Utah-based 
company known as ClearPlay joined on the side of Clean Flicks. 
ClearPlay employees view motion pictures and create software 
filters that tag scenes they find offensive in each movie; this 
editing is done without notice to or permission from the 
copyright owners (the movie studios) or movie directors.\8\ 
When downloaded to a specially-adapted DVD player, the 
ClearPlay software filter instructs the player to ``skip and 
mute'' the tagged content when the affiliated DVD movie is 
played. Consumers who play a DVD they have rented or purchased 
would thus not see or hear the scenes that ClearPlay has tagged 
for filtering.
---------------------------------------------------------------------------
    \8\ ClearPlay has fourteen filter settings: (1) strong action 
violence, (2) gory/brutal violence, (3) disturbing images (i.e., 
macabre and bloody images), (4) sensual content, (5) crude sexual 
content, (6) nudity (including art), (7) explicit sexual situations, 
(8) vain references to deity, (9) crude language and humor, (10) ethnic 
and racial slurs, (11) cursing, (12) strong profanity, (13) graphic 
vulgarity, and (14) explicit drug use.
---------------------------------------------------------------------------
    The bill directly addresses copyright and trademark issues 
raised in the case and inappropriately takes the side of one 
party. First, the content creators allege in the lawsuit that 
ClearPlay makes derivative works in violation of the Copyright 
Act; in particular, they argue ClearPlay's editing software 
violates their exclusive rights as movie copyright owners to 
make modifications or other derivations of the original 
movies.\9\
---------------------------------------------------------------------------
    \9\ See The Player Control Parties' Opening Brief in Support of 
Their Motion for Summary Judgment, Huntsman v. Soderbergh (D. Colo.) 
(No. 02-M-1662). Section 106(2) of title 17, United States Code, gives 
to authors the exclusive right to ``prepare derivative works based on 
the copyrighted work.'' The Copyright Act further defines a 
``derivative work'' as ``a work based upon one or more preexisting 
works, such as a translation, musical arrangement, dramatization, 
fictionalization, motion picture version, sound recording, art 
reproduction, abridgment, condensation, or any other form in which a 
work may be recast, transformed, or adapted. A work consisting of 
editorial revisions, annotations, elaborations, or other modifications, 
which, as a whole, represent an original work of authorship, is a 
`derivative work.' '' 17 U.S.C. Sec. 101.
---------------------------------------------------------------------------
  The Register of Copyrights has testified as to her opinion about the 
copyright issues involved in the case. The Register believes that 
infringement of the exclusive right under 17 U.S.C. Sec. 106(2) to make 
derivative works requires creation of a fixed copy of a derivative 
work. H.R. 4586 Hearing at 7. While the Register's opinion clearly 
bears much authority, it is neither binding on a court nor dispositive 
of the pending lawsuit. Due to the novelty of both the legal and 
technological issues involved, the court may very well reach a 
different conclusion from that drawn by the Register.
    Though no court has ruled on this issue, the bill would 
assist ClearPlay by preemptively vitiating this legal claim. It 
would amend the law to state that certain technology which 
makes portions of motion picture content imperceptible during 
playback does not violate copyright law. While not benefitting 
Clean Flicks and certain other defendants, the bill is 
specifically designed to legalize ClearPlay technology.
    Second, film directors claim that ClearPlay violates their 
trademark rights under section 43(a) of the Lanham Act.\10\ The 
directors allege that ClearPlay uses their trademarked names in 
a way that is likely to cause confusion as to the affiliation, 
connection, or association of ClearPlay with the director, or 
as to the origin, sponsorship, or approval of ClearPlay by the 
director.\11\ Their allegation is based on the fact that a 
ClearPlay-sanitized film still indicates the name of the 
director, making it incorrectly appear as if the director has 
approved the sanitized version.
---------------------------------------------------------------------------
    \10\ See The Player Control Parties' Opening Brief in Support of 
Their Motion for Summary Judgment, Huntsman v. Soderbergh (D. Colo.) 
(No. 02-M-1662).
    \11\ See 15 U.S.C. Sec. 1125(a)(1).
---------------------------------------------------------------------------
    As with the copyright claims against ClearPlay, the bill 
would usurp judicial consideration of the trademark claims 
against ClearPlay by legalizing the very conduct at issue in 
the pending litigation. The bill would make it legal under 
trademark law to sell a product that alters a work and then 
still attribute that work to the original's creator. The effect 
would again be to specifically benefit one party, ClearPlay, to 
the detriment of all others involved in pending litigation.
    In summary, the directors and movie studios have non-
frivolous legal claims against ClearPlay. Because the case has 
not proceeded past the most preliminary stages at the trial 
level, there has not been any statutory interpretation, let 
alone a problematic one, that would justify a legislative 
solution. In other words, the law has yet to be interpreted in 
this area, so there is no rational basis for Congress to pass 
legislation that eliminates certain copyright and trademark 
rights that are at issue between specific parties.
    Passage of this legislation is even more problematic 
considering that, over the past year, movie creators have 
negotiated in good faith to settle their dispute with 
ClearPlay. The movie creators had offered ClearPlay terms that 
would allow it to deploy its technology without fear of 
copyright or trademark liability.\12\ Unfortunately, due to the 
two hearings on this issue and the movement of H.R. 4586, those 
negotiations have stalled; ClearPlay has been emboldened to 
present several new demands that represent a significant step 
back from its previous positions. The growing prospects for a 
legislative fix have caused ClearPlay to abandon good-faith 
negotiation and have made it less likely that consumers will 
have the choices the bill's proponents allegedly desire.
---------------------------------------------------------------------------
    \12\ Despite the extremely complicated nature of these 
negotiations, they had proceeded quite far. In December 2003, the DGA 
agreed not to object under its collective bargaining agreement if the 
studios offered ClearPlay a license to utilize the edits contained in 
television and airplane versions of movies. The DGA believed this 
compromise was tolerable because a film's director usually makes the 
necessary edits for television and airplane versions and is able to 
control the integrity of such edited versions. Over the course of the 
next several months, the studios conveyed an offer along these lines to 
ClearPlay.
---------------------------------------------------------------------------
  More recently, ClearPlay presented the studios with a counteroffer. 
The studios forwarded this counteroffer to the DGA for its response. In 
a May 29, 2004 response, the DGA relaxed certain limitations on a 
previous agreement to allow ClearPlay to license the television and 
airplane versions of movies. Rather than accept this offer, or present 
a good-faith counteroffer, ClearPlay apparently has enlarged its 
demands: (1) for movies where, no airplane or television version is 
available, it has sought the ability to edit them; and (2) with regard 
to films for which television or airplane versions have been made 
available, it is asking that it be able to make its own edits, rather 
than use the pre-existing edited versions.
    In short, fundamental fairness prohibits Congress from 
passing legislation to influence a pending case and private 
business negotiations. As a matter of equity, it is unfair to 
change the rules in the middle of the game, particularly to 
help one specific entity; if passed, H.R. 4586 would be an 
unfortunate example of such unfairness. For these reasons, H.R. 
4586 should not be considered while litigation is pending.\13\
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    \13\ See H.R. 4586 Hearing at 8 (statement of Marybeth Peters, 
Register of Copyrights) (``I do not believe that such legislation 
should be enacted--and certainly not at this time. As you know, 
litigation addressing whether the manufacture and distribution of such 
software violates the copyright law and the Lanham Act is currently 
pending in the United States District Court for the District of 
Colorado. A summary judgment motion is pending. The court has not yet 
ruled on the merits. Nor has a preliminary injunction been issued--or 
even sought.'')
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                      B. H.R. 4586 IS UNNECESSARY

    Regardless of the outcome of the pending litigation, this 
legislation should not be brought before the House because it 
is unnecessary. Its supposed rationale is to make it easier for 
parents and children to avoid watching motion pictures with 
undesired content, but parents and children already have such 
options.
    At the outset, there is an obvious marketplace solution to 
undesired content in that consumers can merely elect not to 
view it. As the Register of Copyrights testified:

        I cannot accept the proposition that not to permit 
        parents to use such products means that they are 
        somehow forced to expose their children (or themselves) 
        to unwanted depictions of violence, sex and profanity. 
        There is an obvious choice--one which any parent can 
        and should make: don't let your children watch a movie 
        unless you approve of the content of the entire 
        movie.\14\
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    \14\ H.R. 4586 Hearing at 9 (written statement of Marybeth Peters) 
(emphasis added).

    The motion picture industry has even enhanced the ability 
of consumers to exercise this choice. For decades and on a 
voluntary basis, it has implemented a rating system for its 
products that indicates the level of sexual or violent content 
and the target audience age.\15\ Each and every major motion 
picture released in theaters or on DVD or VHS bears such a 
rating. Such ratings effectively enable parents to steer their 
children away from movies they consider inappropriate.
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    \15\ Motion Picture Ass'n of America, Movie Rating System 
Celebrates 34th Anniversary with Overwhelming Parental Support (Oct. 
31, 2002) (press release). The industry has five rating categories: G 
for General Audiences, PG for Parental Guidance Suggested, PG-13 for 
Parental Caution Suggested for children under 13, R for Restricted 
(parent or guardian required for children under 17), and NC-17 for No 
Children 17 and under admitted.
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    Most importantly, the film rating system enable parents to 
identify movies that they consider appropriate for their 
children, and the industry has acted to make this choice 
meaningful. The industry annually releases dozens of films 
geared toward audiences who do not wish to see sexual, violent, 
or profane content.\16\ As a result, it is clear that the movie 
industry provides parents with abundant opportunity to find 
films they will consider appropriate for their children. The 
movie industry has, therefore, already met the request of an 
H.R. 4586 supporter who looked forward to a day when ``the 
industry will get around to issue us age-appropriate 
products.'' \17\
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    \16\ In 1999, filmmakers released 14 G-rated and 24 PG-rated major 
motion pictures. In 2000, there were 16 G-rated and 27 PG-rated films. 
In 2001, 8 G-rated and 27 PG-rated movies were released. In 2002, 12 G-
rated and 50 PG-rated pictures were distributed. Finally, in 2003, 11 
G-rated and 34 PG-rated motion pictures were released.
    \17\ H.R. 4586 Hearing at 15 (statement of Amitai Etzioni, Founder 
and Director, The Institute for Communitarian Policy Studies, George 
Washington University).
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    While some of the bill's supporters say these choices are 
meaningless on the grounds that the entertainment industry 
markets violent and sexual content to youth,\18\ that claim is 
false according to the most recent and objective report. The 
Federal Trade Commission conducted the most recent study on 
this issue and concluded the following:
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    \18\ May 20, 2004 Hearing at 20 (statement of Jeff J. McIntyre, 
Senior Legislative and Federal Affairs Officer, American Psychological 
Ass'n).

        On the whole, the motion picture industry has continued 
        to comply with its pledge not to specifically target 
        children under 17 when advertising films rated R for 
        violence. In addition, the studios generally are 
        providing clear and conspicuous ratings and rating 
        information in advertisements for their R- and PG-13 
        rated films.\19\
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    \19\ Federal Trade Comm'n, Marketing Violent Entertainment to 
Children: A Fourth Follow-up Review of Industry Practices in the Motion 
Picture, Music Recording & Electronic Game Industries 10 (July 2004).

The industry is, therefore, doing its part to keep undesired 
content away from children.
    The facts demonstrate that parents have the information and 
tools necessary to make and enforce informed choices about the 
media their children experience and have plenty of wholesome 
media alternatives to offer their children.

   C. H.R. 4586 WOULD LEGALIZE EDITING THAT IS INCOMPREHENSIBLE AND 
      OVERBROAD AND WOULD LEAD TO AN INCREASE IN UNDESIRED CONTENT

    H.R. 4586 would lead to editing that is inconsistent, 
overbroad, and counterproductive. First, ClearPlay does not 
screen out the content it purportedly is designed to filter. 
The New York Times found that ClearPlay's editing does not 
conform to its own standards:

        For starters, its editors are wildly inconsistent. They 
        duly mute every ``Oh my God,'' ``You bastard,'' and 
        ``We're gonna have a helluva time'' (meaning sex). But 
        they leave intact various examples of crude teen slang 
        and a term for the male anatomy.

        In ``Pirates of the Caribbean,'' ``God-forsaken 
        island'' is bleeped, but ``heathen gods'' slips 
        through.\20\
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    \20\ David Pogue, Add ``Cut'' and ``Bleep'' to a DVD's Options, 
N.Y. Times, May 27, 2004, at G1.

In this regard, ClearPlay is seemingly ineffective, and the 
legislation would be, as well.
    Second, the legislation is overbroad and would go beyond 
its allegedly intended effects of legalizing tools for 
sanitizing movies of sex, violence, and profanity. In fact, 
H.R. 4586 would legalize a far wider and less desirable 
universe of filters for profit than its sponsors have 
disclosed. Filters could be based on social, political, and 
professional prejudices and could edit more than just movies.
    For instance, because the bill is not explicitly limited to 
the deletion of sex, violence, and profanity, it would legalize 
socially-undesirable editing, such as:

         LA filter that edits out racial conflict 
        between law enforcement and minorities in The 
        Hurricane, conflict that sets the context for how the 
        minorities later react to the police; \21\
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    \21\ ClearPlay actually has made such edits. ``In its alterations 
of the film, ClearPlay chooses to omit the racist language [used by 
white police officers against a young Rubin Carter] that is integral to 
our understanding of the story. . . . ClearPlay skips these lines in 
full, choosing to fast-forward its version of the movie to a later part 
of the interrogation scene. However, it is via this racist and 
threatening language that the audience connects with the intimidation 
that the young Carter must feel and the racism he is encountering at 
the very center of law enforcement.'' Rosen Decl., supra note 4, at 6-
7.

         LA filter that skips over the nude scenes from 
        Schindler's List, scenes that are critical to conveying 
        the debasement and dehumanization suffered by 
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        concentration camp prisoners;

         LA filter that strips Jungle Fever of scenes 
        showing interracial romance and leaves only those 
        scenes depicting interracial conflict; and

         LA filter marketed by Holocaust revisionists 
        that removes from World War II documentaries any 
        footage of concentration camp.

    The legislation also would immunize products that filter 
political or business content based on the opinions of the 
creator, including:

         LA filter that skips over political 
        advertisements contrary to the positions of the 
        developer's beliefs;

         LA filter that cleanses news stories, such as 
        by editing out comments in support of or in opposition 
        to government policies; and

         LA filter that deletes television stories 
        either helpful to the filter developer's competitor or 
        critical of the developer's corporate parent.

    We would hope that none of the bill's proponents would 
condone such malicious editing. Unfortunately, at the full 
Committee markup of the legislation, the sponsors rejected an 
effort to limit the proposal to its purported scope of profane, 
sexual, and violent content.\22\ If enacted, H.R. 4586 could 
lead to the editing of artistic works based upon racial, 
religious, social, political, and business biases.
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    \22\ See Markup of H.R. 4586 Before the House Comm. on the 
Judiciary, 108th Cong., 2d Sess. (July 21, 2004) (amendment offered by 
Rep. Adam Schiff (D-CA) to limit editing to profane, sexual, and 
violent content) [hereinafter H.R. 4586 Markup]. The amendment was 
defeated by voice vote. Id.
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    Moreover, the bill would permit the editing of works other 
than movies. While the bill's author argues that its purpose is 
to sanitize movies,\23\ a close reading of the legislation 
shows that it would permit the editing of broadcast television 
programming, as well. More specifically, H.R. 4586 permits the 
``making of limited portions of audio or video content of a 
motion picture imperceptible.'' \24\ The copyright law defines 
``motion pictures'' as ``audiovisual works consisting of a 
series of related images which, when shown in succession, 
impart an impression of motion, together with accompanying 
sounds, if any.'' \25\ Because this definition includes 
television programs,\26\ the legislation would permit editing 
of broadcast television.
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    \23\ H.R. 4586 Markup (statement of Rep. Lamar Smith (R-TX)).
    \24\ H.R. 4586.
    \25\ 17 U.S.C. Sec. 101.
    \26\ H.R. Rep. No. 1476, 94th Cong., 2d Sess. (1976) (House report 
on the 1976 Copyright Act).
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    As a result, the bill would legalize a filter that skips, 
for instance, all commercial advertisements during playback of 
free, over-the-air broadcast television programming. The 
revenues that broadcast television companies generate from 
selling commercial advertisement time is the sole means by 
which television programming is financed.\27\ Permitting 
television commercials to be deleted would reduce the ability 
of television programmers to sell ad time and thus make it 
financially difficult for television stations to remain in 
business. Consumers across the country would thus be deprived 
of a prime and free source of news, entertainment, and other 
information.
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    \27\ In the Matter of Commission Seeks Public Comment on Spectrum 
Policy Task Force Report: Joint Reply Comments of the Association for 
Maximum Service Television, Inc. and the National Association of 
Broadcasters Before the Federal Communications Comm'n, ET Docket No. 
02-135 13 (Feb. 28, 2003).
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    Finally, the legislation could lead to increased violence 
and sexual content in entertainment. Just as H.R. 4586 allows 
nudity to be edited out, it allows everything except nudity to 
be deleted. This concern is not merely hypothetical. Nissim 
Corporation has patented a technology called CustomPlay that, 
among other things, enables viewers of pornographic movies to 
filter out the non-pornographic scenes and ``enhance'' the 
adult-viewing experience.\28\
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    \28\ Using CustomPlay, ``[a]n adult can play a version of an adult 
video that seamlessly excludes content inconsistent with the viewer's 
adult content preferences, and that is presented at a level of 
explicitness preferred by the adult. Adult content categories are 
standardized and are organized into five groups Who, What, Camera, 
Position, and Fetish.'' CustomPlay, Content Preferences (visited Aug. 
24, 2004) .
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    Additionally, because H.R. 4586 only protects technology 
developers like ClearPlay from liability for copyright and 
trademark infringement, Nissim may cause the bill to backfire 
on its sponsors. Nissim has sued ClearPlay for patent 
infringement, claiming to have a patent on ClearPlay-type film-
editing technology.\29\ If Nissim's claims are valid, then only 
Nissim could distribute such film-editing software.\30\ Thus, 
contrary to its stated purpose, H.R. 4586 could succeed in 
legalizing only Nissam's technology, which enables users to 
increase the proportion of sex or violence in a movie.
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    \29\ Nissim Corp. v. ClearPlay, No. 04-21140 (S.D. Fla. filed May 
13, 2004).
    \30\ In response to a cease-and-desist letter from Nissim, a 
manufacturer of DVD players, Thomson, pulled ClearPlay-enabled players 
from the retail market.
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        D. H.R. 4586 WOULD IMPAIR ARTISTIC FREEDOM AND INTEGRITY

    The problems with this legislation are compounded by the 
fact that it violates principles of artistic freedom and 
expression. The concept of protecting artistic freedom is well 
recognized.\31\ The National Endowment for the Arts states 
``[a]rtistic work and freedom of expression are a vital part of 
any democratic society.'' \32\ For this reason, the NEA seeks 
to preserve works of art,\33\ and an important part of 
preservation is to ensure artists are involved in how their 
creations are portrayed.
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    \31\ Sam Ricketson, The Berne Convention: 1886-1986 456 (1997) 
(``Any author, whether he writes, paints, or composes, embodies some 
part of himself--his thoughts, ideas, sentiments and feelings--in his 
work, and this gives rise to an interest as deserving of protection as 
any of the other personal interests protected by the institutions of 
positive law, such as reputation, bodily integrity, and confidences. 
The interest in question here relates to the way in which the author 
presents his work to the world, and the way in which his identification 
with the work is maintained.'').
    \32\ National Endowment for the Arts, Strategic Plan: FY2003-2008 3 
(Feb. 2003).
    \33\ Id. at 8.
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    This principle, commonly referred to as a ``moral right,'' 
is so important that it is required by international agreements 
and is codified in U.S. law. For instance, the Berne Convention 
for the Protection of Literary and Artistic Works grants 
creators the right to object to ``any distortion, mutilation, 
or other modification of, or other derogatory action in 
relation to, the said work, which would be prejudicial to his 
honor or reputation.'' \34\ The United States, recognizing the 
importance of this right, subsequently enacted it into both 
copyright law \35\ and trademark law.\36\
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    \34\ Berne Convention for the Protection of Literary and Artistic 
Works, art. 6bis, 1971.
    \35\ 17 U.S.C. Sec. 106A.
    \36\ 15 U.S.C. Sec. 1125.
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    While moral rights protection for U.S. creators is far 
weaker than the protection afforded European creators, a 
certain level of protection for the moral rights of U.S. 
creators does exist. The ability of creators to bring claims 
under the Lanham Act, just as directors have done against 
ClearPlay, does provide creators with an important ability to 
protect their moral rights. In fact, the availability of 
section 43(a) was one of the specific reasons Congress decided, 
during adoption of the Berne Convention Implementation Act, 
that U.S. law met the moral rights obligations contained in the 
Berne Convention.\37\ By limiting the availability of Lanham 
Act suits, H.R. 4586 is limiting the moral rights of directors 
in a way that conflicts with U.S. obligations under the Berne 
Convention.
---------------------------------------------------------------------------
    \37\ 133 Cong. Rec. H1293 (daily ed. Mar. 16, 1987) (statement of 
Rep. Robert Kastenmeier).
---------------------------------------------------------------------------
    Contrary to our laws and international obligations, H.R. 
4586 does not require that filtering be done with the 
permission of the content creator or owner, but rather creates 
an exemption from copyright and trademark liability for 
filtering. As the Register of Copyrights stated before the 
Subcommittee:

        I have serious reservations about enacting legislation 
        that permits persons other than the creators or 
        authorized distributors of a motion picture to make a 
        profit by selling adaptations of somebody else's motion 
        picture. It's one thing to say that an individual, in 
        the privacy of his or her home, should be able to 
        filter out undesired scenes or [dialogue] from his or 
        her private home viewing of a movie. It's another 
        matter to say that a for-profit company should be able 
        to commercially market a product that alters a 
        director's artistic vision.\38\
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    \38\ H.R. 4586 Hearing at 10 (written statement of Marybeth 
Peters).

    It is clear, therefore, that the legislation violates an 
artist's right to his or her artistic integrity. To permit 
editing of a creation without the permission of the creator is 
to encourage censorship and to vitiate freedom of expression.
    In conclusion, H.R. 4586 is ill-conceived, poorly-drafted 
legislation. Beyond its patent assault on intellectual property 
rights, the bill inappropriately involves Congress in a private 
business dispute and would lead to socially undesirable editing 
and actually permit the distribution of technology that makes 
pornography even more pornographic. Finally, it encourages 
unwarranted intrusions into artistic freedom. For these 
reasons, we dissent.

                                   John Conyers, Jr.
                                   Howard L. Berman.
                                   Robert C. Scott.
                                   Sheila Jackson Lee.
                                   Maxine Waters.
                                   William D. Delahunt.
                                   Robert Wexler.
                                   Tammy Baldwin.

                                 
