[House Report 117-693]
[From the U.S. Government Publishing Office]
117th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 117-693
======================================================================
AMERICAN MUSIC FAIRNESS ACT OF 2022
_______
December 30, 2022.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Nadler, from the Committee on the Judiciary, submitted the
following
R E P O R T
[To accompany H.R. 4130]
The Committee on the Judiciary, to whom was referred the
bill (H.R. 4130) to amend title 17, United States Code, to
provide fair treatment of radio stations and artists for the
use of sound recordings, and for other purposes, having
considered the same, reports favorably thereon with an
amendment and recommends that the bill as amended do pass.
CONTENTS
Page
Purpose and Summary.............................................. 4
Background and Need for the Legislation.......................... 5
Hearings......................................................... 8
Committee Consideration.......................................... 9
Committee Votes.................................................. 9
Committee Oversight Findings..................................... 9
Committee Estimate of Budgetary Effects.......................... 9
New Budget Authority and Congressional Budget Office Cost
Estimate....................................................... 9
Duplication of Federal Programs.................................. 9
Performance Goals and Objectives................................. 9
Advisory on Earmarks............................................. 10
Section-by-Section Analysis...................................... 10
Changes in Existing Law Made by the Bill, as Reported............ 11
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``American Music
Fairness Act of 2022''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Equitable treatment for terrestrial broadcasts and internet
services.
Sec. 3. Timing of proceedings under sections 112(e) and 114(f).
Sec. 4. Special protection for small broadcasters.
Sec. 5. Distribution of certain royalties.
Sec. 6. No harmful effects on songwriters.
Sec. 7. Value of promotion taken into account.
SEC. 2. EQUITABLE TREATMENT FOR TERRESTRIAL BROADCASTS AND INTERNET
SERVICES.
(a) Performance Right Applicable to Audio Transmissions Generally.--
Paragraph (6) of section 106 of title 17, United States Code, is
amended to read as follows:
``(6) in the case of sound recordings, to perform the
copyrighted work publicly by means of an audio transmission.''.
(b) Inclusion of Terrestrial Broadcasts in Existing Performance Right
and Statutory License.--Section 114(d)(1) of title 17, United States
Code, is amended--
(1) in the matter preceding subparagraph (A), by striking ``a
digital'' and inserting ``an'';
(2) by striking subparagraph (A);
(3) by redesignating subparagraphs (B) and (C) as (A) and
(B), respectively; and
(4) in subparagraph (A), as redesignated by paragraph (3), by
striking ``nonsubscription'' each place such term appears and
inserting ``licensed nonsubscription''.
(c) Technical and Conforming Amendments.--
(1) Definition.--Section 101 of title 17, United States Code,
is amended by inserting after the definition of ``architectural
work'' the following:
``An `'audio transmission'' is a transmission of a sound recording,
whether in a digital, analog, or other format. This term does not
include the transmission of any audiovisual work.''.
(2) Conforming removal of digital.--Title 17, United States
Code, is amended--
(A) in section 112(e)(8), by striking ``a digital
audio transmission'' and inserting ``an audio
transmission'';
(B) in section 114--
(i) in subsection (d)--
(I) in paragraph (2)--
(aa) in the matter preceding
subparagraph (A), by striking
``subscription digital'' and
inserting ``subscription''; and
(bb) in subparagraph
(C)(viii), by striking
``digital signal'' and
inserting ``signal''; and
(II) in paragraph (4)--
(aa) in subparagraph (A), by
striking ``a digital audio
transmission'' and inserting
``an audio transmission''; and
(bb) in subparagraph (B)(i),
by striking ``a digital audio
transmission'' and inserting
``an audio transmission'';
(ii) in subsection (g)(2)(A), by striking ``a
digital'' and inserting ``an''; and
(iii) in subsection (j)--
(I) in paragraph (6)--
(aa) by striking ``digital'';
and
(bb) by striking
``retransmissions of broadcast
transmissions'' and inserting
``broadcast transmissions and
retransmissions of broadcast
transmissions''; and
(II) in paragraph (8), by striking
``subscription digital'' and inserting
``subscription''; and
(C) in section 1401--
(i) in subsection (b), by striking ``a
digital audio'' and inserting ``an audio''; and
(ii) in subsection (d)--
(I) in paragraph (1), by striking ``a
digital audio'' and inserting ``an
audio'';
(II) in paragraph (2)(A), by striking
``a digital audio'' and inserting ``an
audio''; and
(III) in paragraph (4)(A), by
striking ``a digital audio'' and
inserting ``an audio''.
SEC. 3. TIMING OF PROCEEDINGS UNDER SECTIONS 112(E) AND 114(F).
Paragraph (3) of section 804(b) of title 17, United States Code, is
amended by adding at the end the following new subparagraph:
``(D) A proceeding under this chapter shall be
commenced as soon as practicable after the date of the
enactment of this subparagraph to determine royalty
rates and terms for nonsubscription broadcast
transmissions, to be effective for the period beginning
on such date of enactment, and ending on December 31,
2028. Any payment due under section 114(f)(1)(D) shall
not be due until the due date of the first royalty
payments for nonsubscription broadcast transmissions
that are determined, after the date of the enactment of
this subparagraph, by the Copyright Royalty Judges.
Thereafter, such proceeding shall be repeated in each
subsequent fifth calendar year.''.
SEC. 4. SPECIAL PROTECTION FOR SMALL BROADCASTERS.
(a) Specified Royalty Fees.--Section 114(f)(1) of title 17, United
States Code, is amended by inserting at the end the following new
subparagraph:
``(D)(i) Notwithstanding the provisions of
subparagraphs (A) through (C), the royalty rate shall
be as follows for nonsubscription broadcast
transmissions by each individual terrestrial broadcast
station licensed as such by the Federal Communications
Commission that satisfies the conditions in clause
(ii)--
``(I) $10 per calendar year, in the case of
nonsubscription broadcast transmissions by a
broadcast station that generated revenue in the
immediately preceding calendar year of less
than $100,000;
``(II) $100 per calendar year, in the case of
nonsubscription broadcast transmissions by a
broadcast station that is a public broadcasting
entity as defined in section 118(f) and
generated revenue in the immediately preceding
calendar year of $100,000 or more, but less
than $1,500,000; and
``(III) $500 per calendar year, in the case
of nonsubscription broadcast transmissions by a
broadcast station that is not a public
broadcasting entity as defined in section
118(f) and generated revenue in the immediately
preceding calendar year of $100,000 or more,
but less than $1,500,000.
``(ii) An individual terrestrial broadcast station
licensed as such by the Federal Communications
Commission is eligible for a royalty rate set forth in
clause (i) if--
``(I) the revenue from the operation of that
individual station was less than $1,500,000
during the immediately preceding calendar year;
``(II) the aggregate revenue of the owner and
operator of the broadcast station and any
person directly or indirectly controlling,
controlled by, or under common control with
such owner or operator, from any source, was
less than $10,000,000 during the immediately
preceding calendar year; and
``(III) the owner or operator of the
broadcast station provides to the nonprofit
collective designated by the Copyright Royalty
Judges to distribute receipts from the
licensing of transmissions in accordance with
subsection (f), by no later than January 31 of
the relevant calendar year, a written and
signed certification of the station's
eligibility under this clause and the
applicable subclause of clause (i), in
accordance with requirements the Copyright
Royalty Judges shall prescribe by regulation.
``(iii) For purposes of clauses (i) and (ii)--
``(I) revenue shall be calculated in
accordance with generally accepted accounting
principles;
``(II) revenue generated by a terrestrial
broadcast station shall include all revenue
from the operation of the station, from any
source; and
``(III) in the case of affiliated broadcast
stations, revenue shall be allocated reasonably
to individual stations associated with the
revenue.
``(iv) The royalty rates specified in clause (i)
shall not be admissible as evidence or otherwise taken
into account in determining royalty rates in a
proceeding under chapter 8, or in any other
administrative, judicial, or other Federal Government
proceeding involving the setting or adjustment of the
royalties payable for the public performance or
reproduction in ephemeral phonorecords or copies of
sound recordings, the determination of terms or
conditions related thereto, or the establishment of
notice or recordkeeping requirements.''.
(b) Technical Correction.--Section 118(f) of title 17, United States
Code, is amended by striking ``section 397 of title 47'' and inserting
``section 397 of the Communications Act of 1934 (47 U.S.C. 397)''.
SEC. 5. DISTRIBUTION OF CERTAIN ROYALTIES.
Section 114(g) of title 17, United States Code, is amended--
(1) in paragraph (1), by inserting ``or in the case of a
transmission to which paragraph (5) applies'' after ``this
section'';
(2) by redesignating paragraphs (5), (6), and (7) as (6),
(7), and (8), respectively; and
(3) by inserting after paragraph (4) the following new
paragraph:
``(5) Notwithstanding paragraph (1), to the extent that a
license granted by the copyright owner of a sound recording to
a transmitting entity eligible for a statutory license under
subsection (d)(2) extends to such entity's transmissions
otherwise licensable under a statutory license in accordance
with subsection (f), such entity shall pay to the collective
designated to distribute statutory licensing receipts from the
licensing of transmissions in accordance with subsection (f),
50 percent of the total royalties that such entity is required,
pursuant to the applicable license agreement, to pay for such
transmissions otherwise licensable under a statutory license in
accordance with subsection (f). That collective shall
distribute such payments in proportion to the distributions
provided in subparagraphs (B) through (D) of paragraph (2), and
such payments shall be the only payments to which featured and
nonfeatured artists are entitled by virtue of such
transmissions under the direct license with such entity.''.
SEC. 6. NO HARMFUL EFFECTS ON SONGWRITERS.
Nothing in this Act, or the amendments made by this Act, shall
adversely affect in any respect the public performance rights of or
royalties payable to songwriters or copyright owners of musical works.
SEC. 7. VALUE OF PROMOTION TAKEN INTO ACCOUNT.
Pursuant to section 114(f)(1)(B) of title 17, United States Code, in
determining rates and terms for terrestrial broadcast radio stations
under this Act, and the amendments made by this Act, the Copyright
Royalty Judges shall base their decision on economic, competitive, and
programming information presented by the parties, including whether use
of the station's service may substitute for or may promote the sales of
phonorecords or otherwise may interfere with or may enhance the sound
recording copyright owner's other streams of revenue from the copyright
owner's sound recordings.
Purpose and Summary
H.R. 4130, the ``American Music Fairness Act,'' is a
bipartisan bill that would expand the scope of public
performance rights in sound recordings to include terrestrial
broadcast (AM/FM radio) performances. Specifically, the bill
requires terrestrial radio stations that broadcast copyright-
protected sound recordings over AM/FM radio to pay a public
performance royalty to the copyright owners of, and artists who
performed, the sound recordings.
A ``sound recording'' is a recording of a particular
performance of a musical work.\1\ Typically, the copyright
owners of a sound recording are the artists who performed the
musical work (e.g., musicians and vocalists), and the producer
who captured, manipulated, and/or edited the work's sounds, who
may assign their rights to others, such as record labels. Under
current federal law, when a terrestrial radio station
broadcasts a copyright-protected sound recording, it is not
required to pay a public performance royalty to these copyright
owners.\2\ This contrasts with digital broadcast platforms
(e.g., cable, satellite, or the internet), which are required
by federal law to pay public performance royalties to the
performing artists, musicians, and other copyright owners of
the sound recordings.\3\ As a result, satellite radio and
digital streaming services are at a competitive disadvantage to
terrestrial radio stations. Additionally, American singers,
musicians, and producers fail to receive millions of dollars in
pay when terrestrial radio stations broadcast their creative
works without compensation.
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\1\Specifically, the Copyright Act defines ``sound recordings'' as
``works that result from the fixation of a series of musical, spoken,
or other sounds, but not including the sounds accompanying a motion
picture or other audiovisual work, regardless of the nature of the
material objects, such as disks, tapes, or other phonorecords, in which
they are embodied.'' 17 U.S.C. Sec. 101. The Copyright Act does not
define a ``musical work,'' but for registration purposes, the Copyright
Office defines ``musical works'' as ``original works of authorship
consisting of music and any accompanying words.'' Compendium of U.S.
Copyright Office Practices, 3rd ed. Sec. 802.01.
\2\See 17 U.S.C. Sec. 114(d)(1). Instead, the station pays a public
performance royalty only to the copyright owners of the underlying
musical work--usually the composer/songwriter or music publisher who
has a public performance right to that work. 17 U.S.C. Sec. 106.
\3\Like analog broadcasts, the digital broadcast by means of
``high-definition radio'' (HD-radio) technology by a terrestrial radio
station is exempt under current law from paying a public performance
royalty to sound recording owners. When ``simulcasting'' terrestrial
radio signals via the internet though, terrestrial radio stations are
subject to the payment of public performance royalties to sound
recording owners under 17 U.S.C. Sec. 114.
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H.R. 4130 corrects this unfairness by establishing that a
copyright owner's public performance right to a sound recording
encompasses an ``audio transmission''--rather than merely a
``digital audio transmission,'' as currently worded. The bill
defines an ``audio transmission'' as ``a transmission of a
sound recording, whether in digital, analog, or other format.''
By expanding the scope of existing public performance rights in
sound recordings to all audio transmissions, the bill requires
terrestrial radio stations--like digital broadcast platforms--
to secure a license to publicly broadcast a copyright-protected
sound recording.
Under the bill, terrestrial radio stations will use the
same royalty payment system that satellite radio and digital
streaming services already use--i.e., an existing non-profit
licensing collective that is required to split the public
performance royalty among the copyright owners. The Copyright
Royalty Board sets, and periodically resets, the royalty rate.
H.R. 4130 specifies that, when determining the royalty rate,
the Board must base its decision on economic, competitive, and
programming information presented by the parties, including
whether the radio station's service in broadcasting the sound
recording enhances the copyright owners' other streams of
revenue.
The bill also protects certain small terrestrial radio
stations (and the owners of those stations) by excluding radio
stations that fall beneath certain revenue thresholds from the
Board-established royalty rate. These excluded terrestrial
radio stations will instead pay yearly small flat fees for a
license to publicly perform copyright-protected sound
recordings. Specifically, the bill establishes an affordable,
predictable annual fee that allows these small terrestrial
radio stations to play unlimited music: $10/year for stations
earning less than $100,000/year, $100/year for public broadcast
stations earning $100,000 to $1,500,000, and $500/year for
other broadcast stations earning $100,000 to $1,500,000, unless
they are owned by a parent company making over $10 million/
year.
Representatives Ted Deutch (D-FL) and Darrell E. Issa (R-
CA) introduced H.R. 4130 on June 24, 2021, with Chairman
Jerrold Nadler (D-NY), Rep. Tom McClintock (R-CA), Rep. Karen
Bass (D-CA), Rep. Diana Harshbarger (R-TN), and Rep. Judy Chu
(D-CA) as original cosponsors. Following Rep. Deutch's
departure from the House, Chairman Nadler assumed first
sponsorship of H.R. 4130 on November 16, 2022, via unanimous
consent.
Background and Need for the Legislation
1. History of public performance rights
Article I, Section 8 of the Constitution grants Congress
the power ``[t]o promote the progress of science and useful
arts, by securing for limited times to authors and inventors
the exclusive right to their respective writings and
discoveries.''\4\ Congress first established copyright
protection in sound recordings in 1971 when it granted the
owners of such copyrights the right to control the
reproduction, distribution, and adaptation of their works.\5\
Congress did not grant copyright owners the right to control
the ``public performance''\6\ of their sound recordings at the
time, because it believed that possession of the three
aforementioned rights would adequately compensate sound
recording copyright owners.\7\
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\4\US Const. art I, Sec. 8, cl. 8.
\5\For a comprehensive discussion of the history of public
performance rights, see Dana A. Scherer, Cong. Rsch. Serv. R43984,
Money for Something: Music Licensing in the 21st Century 24-31 (2021)
[hereinafter Money for Something].
\6\``To perform or display a work `publicly' means--(1) to perform
or display it at a place open to the public or at any place where a
substantial number of persons outside of a normal circle of a family
and its social acquaintances is gathered; or (2) to transmit or
otherwise communicate a performance or display of the work to a place
specified by clause (1) or to the public, by means of any device or
process, whether the members of the public capable of receiving the
performance or display receive it in the same place or in separate
places and at the same time or at different times.'' 17 U.S.C.
Sec. 101.
\7\See Cong. Rsch. Serv., Copyright Licensing in Music
Distribution, Reproduction, and Public Performance 9 (2015).
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Controversy has always existed over whether the ``bundle of
rights'' to a sound recording should include a public
performance right. In a 1978 report, the Register of Copyrights
recommended that Congress add a sound recording performance
right. The Register predicted that new ``technological
developments could well cause substantial changes in existing
systems for public delivery of sound recordings . . . . [and]
[i]n that event, it [would be] . . . possible that a
performance right would become the major source of income from,
and incentive to, the creation of such works.''\8\
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\8\Register of Copyrights, Report on Performance Right in Sound
Recordings, H.R. Doc. No. 15, 95th Cong. (2d Sess. 1978).
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2. Creation of the digital public performance right for sound
recordings
As the Register predicted, the growing popularity of the
internet created an environment where the public performance of
copyright-protected sound recordings became an important new
source of both revenue and potential piracy. Congress responded
to the introduction of ``[s]atellite and digital technologies
[that made] possible the celestial jukebox, music on demand,
and pay-per-listen services''\9\ on the internet by amending
the Copyright Act to create a public performance right for
digital audio transmissions in the Digital Performance Right in
Sound Recordings Act of 1995.
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\9\S. Rep. No. 104-128 (1995).
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Specifically, Congress amended Section 106 of the Copyright
Act to provide an exclusive right to perform copyrighted sound
recordings publicly by means of a ``digital audio
transmission.''\10\ The Act exempted ``nonsubscription''
transmissions and retransmissions of sound recordings such as
television, radio, and business establishment broadcasts, so as
not to upset the current balance in the industry.\11\ For
``subscription transmissions,'' the 1995 Act created a
statutory licensing scheme under 17 U.S.C. Sec. 114 that
mandated the transmitter pay a royalty and comply with other
requirements.\12\ For ``interactive'' transmissions, the 1995
Act did not include a statutory licensing mechanism and instead
required ``interactive'' transmission services to directly
contract with the sound recording copyright owners, thus
leaving that licensing largely to the free market.\13\
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\10\A digital audio transmission is a ``transmission in whole or in
part in a digital or other non-analog format.'' 17 U.S.C. Sec. 101.
\11\17 U.S.C. Sec. 114(d)(1). See, e.g., S. Rep. No. 104-128, at 15
(1995) explaining, ``The sale of many sound recordings and the careers
of many performers have benefitted from . . . free over-the-air
broadcasting. [. . .] This legislation should do nothing to change or
jeopardize the mutually beneficial economic relationship between the
recording and traditional broadcast industries.''
\12\``A `new subscription service' is a service that performs sound
recordings by means of noninteractive subscription digital audio
transmissions and that is not a preexisting subscription service or a
preexisting satellite digital audio radio service.'' Subscribers pay
for subscription services. 17 U.S.C. Sec. 114(j)(8). These ``other
requirements'' included: (1) not playing too many songs by one artist
in close proximity, (2) not publishing a program schedule in advance,
(3) not causing a listener's receiver equipment to switch from one
channel to another in order to listen to more than one artist's songs
in a row, and (4) including copyright management information for the
music broadcast. 17 U.S.C. Sec. 114(d)(2)(C).
\13\``An `interactive service' is one that enables a member of the
public to receive a transmission of a program specially created for the
recipient, or on request, a transmission of a particular sound
recording, whether or not as part of a program, which is selected by or
on behalf of the recipient.'' 17 U.S.C. Sec. 114(j)(7).
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The Digital Millennium Copyright Act of 1998 (DMCA) amended
the types of transmissions included in the sound recording
public performance right to include noninteractive,
nonsubscription internet radio broadcasters, but continued to
exclude nonsubscription terrestrial radio broadcasts (AM/FM
radio).\14\ While the Music Modernization Act of 2018 (MMA)
modernized many aspects of the music licensing processes, it
left untouched the sound recording public performance right for
terrestrial radio broadcasts.\15\
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\14\See Matthew S. DelNero, Long Overdue? An Exploration of the
Status and Merit of a General Public Performance Right in Sound
Recordings, 51 J. Copyright Soc'y U.S.A. 473, 487 (2004).
\15\Money for Something 10.
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3. Effect of disparate public performance rights on artist compensation
The music industry has continued to evolve since the
passage of the MMA. The popularity of digital downloads has now
declined dramatically, especially since the introduction of
subscription-based music streaming services.\16\ Consumers
today increasingly choose to stream music; webcasting, digital
subscription radio services, and music-streaming services
constituted 82% of consumer spending in the recording industry
in 2019, up from just 12% in 2011.\17\
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\16\Id. at 2.
\17\Id. at 3.
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That streaming services are available over the same devices
as terrestrial radio broadcasts, however, raises concerns about
the disparate treatment of artists when their works are
broadcast over terrestrial radio versus satellite and internet
radio.\18\ This is especially true when, for example, a
consumer listening to music in a car may perceive little
difference between these types of platforms.\19\ Recording
artists argue that they are entitled to compensation from
terrestrial radio stations in the same way they receive
compensation from streaming services.\20\ Artists and record
labels calculate that they lose approximately $200 million
yearly, even though large broadcasting corporations take in
billions of dollars an annual advertising revenues.\21\
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\18\United States Copyright Office, Copyright and the Music
Marketplace, 87-88 (2015) [hereinafter Copyright and the Music
Marketplace].
\19\Id. at 88 (noting information that automobile in-dash receivers
are capable of receiving digital and analog transmissions of the same
sound recording).
\20\Id. at 87-88.
\21\Id. at 88; see also Dianlyn Cenidoza, The Clash Between
Terrestrial and Digital Radio: Pinned by the Music Modernization Act,
43 Seattle U. L. Rev. 841, 855 (2020).
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Moreover, because the Copyright Act does not provide a
public performance right to terrestrial radio broadcasts,
American recording artists do not receive public performance
royalties when their sound recordings are played over the radio
in foreign countries, even though virtually all other
industrialized nations recognize some form of public
performance right for sound recordings.\22\ Indeed, the United
States is among only a handful of nations (including Iran and
North Korea) that do not recognize a performer's right to be
paid for the broadcast of his or her music over the radio.\23\
Recording artists in other industrialized countries receive
royalties for their sound recordings played on the radio, but
due to the lack of reciprocity, American recording artists do
not have to be compensated for the terrestrial radio broadcast
of their music abroad.\24\ Given the popularity of American
music world-wide, the amount of lost revenue is large.
According to one estimate, American recording artists lose out
on $70 100 million in royalties for performances of their
copyrighted works abroad.\25\
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\22\Copyright and the Music Marketplace, 89 (2015).
\23\Id. at 89.
\24\Id.; see also John R. Kettle III, Dancing to the Beat of a
Different Drummer: Global Harmonization--And the Need for Congress To
Get in Step with a Full Public Performance Right for Sound Recordings,
12 Fordham Intell. Prop. Media & Ent. L.J. 1041, 1075 (2002) (``The
foreign countries that collect public performance royalties under their
laws only make such royalties available to nationals of member
countries that provide an equivalent right. Since the United States
does not provide a full public performance right for sound recordings,
American recording artists and record labels are not entitled to
receive the millions of dollars in foreign royalties collected that
would otherwise be payable.'').
\25\Copyright and the Music Marketplace, 89 (2015).
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Broadcasters have disputed this amount and point out that
some countries send public performance royalties
voluntarily.\26\ But a new amendment to European law\27\
currently being considered in the European Union would forbid
EU countries that have voluntarily been sending American
artists royalties from doing so going forward. The European
Commission recently completed a ``call for evidence'' on the
remuneration of music performers and record producers from non-
EU countries for recorded music played in the EU from various
stakeholders,\28\ and is considering amending EU law to
expressly mandate reciprocity--meaning that any amount
currently sent to the United States would evaporate.\29\
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\26\Id. at 90.
\27\In the European Union, Article 8(2) of the Rental and Lending
Right Directive (2006/115/EC) governs the remuneration right for
performers and record producers when their sound recordings are
broadcast to the public and played in public places.
\28\https://ec.europa.eu/info/law/better-regulation/have-your-say/
initiatives/13530-Remuneration-of-music-performers-and-record-
producers-from-third-non-EU-countries-for-recorded-music-played-in-the-
EU_en.
\29\One European advocacy group, the Independent Music Companies
Association (IMPALA), estimates that ``125m euros per annum are at
stake''--the amount the group expects to the transferred from Europe to
American artists should the amendment pass. See European
Performance Income & US Repertoire, available at: https://
www.impalamusic.org/european-
performance-income-us-repertoire/.
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Hearings
For the purposes of clause 3(c)(6)(A) of House rule XIII,
the following hearing was used to consider H.R. 4130: On
February 2, 2022, the Committee held a legislative hearing
entitled, ``Respecting Artists with the American Music Fairness
Act,'' to examine both the benefits and drawbacks of extending
the public performance right to all audio sound transmissions.
The hearing included witnesses representing recording artists,
musicians, producers, and broadcasters.\30\ The witnesses were:
(1) Gloria Estefan, Singer, Songwriter, Musician, and Recording
Artist; (2) Barry Massarsky, Partner, Co-Leader, Music
Economics and Valuation Services Practice, Citrin Cooperman
Advisors LLC; (3) Lawrence ``Boo'' Mitchell, Engineer,
Producer, Musician, and Owner, Royal Studios; (4) Curtis
LeGeyt, President and CEO, National Association of
Broadcasters; and (5) Dave Pomeroy, Bassist, Writer, and
Producer; President, Nashville Musicians Association, AFM Local
257; International Executive Officer, American Federation of
Musicians.
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\30\Respecting Artists with the American Music Fairness Act:
Hearing on H.R. 4130 Before the U.S. House of Representatives Judiciary
Committee, 117th Cong. (2022), available at https://
judiciary.house.gov/calendar/eventsingle.aspx?EventID=4835.
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Committee Consideration
On December 7, 2022, the Committee met in open session and
ordered the bill, H.R. 4130, favorably reported, as amended, by
a voice vote, a quorum being present.
Committee Votes
In compliance with clause 3(b) of House rule XIII, no
rollcall votes occurred during the Committee's consideration of
H.R. 4130.
Committee Oversight Findings
In compliance with clause 3(c)(1) of House rule XIII, the
Committee advises that the findings and recommendations of the
Committee, based on oversight activities under clause 2(b)(1)
of House rule X, are incorporated in the descriptive portions
of this report.
Committee Estimate of Budgetary Effects
Pursuant to clause 3(d)(1) of House rule XIII, the
Committee adopts as its own the cost estimate prepared by the
Director of the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974.
New Budget Authority and Congressional Budget Office Cost Estimate
Pursuant to clause 3(c)(2) of House rule XIII and section
308(a) of the Congressional Budget Act of 1974, and pursuant to
clause (3)(c)(3) of House rule XIII and section 402 of the
Congressional Budget Act of 1974, the Committee has requested
but not received from the Director of the Congressional Budget
Office a budgetary analysis and a cost estimate of this bill.
Duplication of Federal Programs
Pursuant to clause 3(c)(5) of House rule XIII, no provision
of H.R. 4130 establishes or reauthorizes a program of the
federal government known to be duplicative of another federal
program.
Performance Goals and Objectives
The Committee states that pursuant to clause 3(c)(4) of
House rule XIII, H.R. 4130 would amend the Copyright Act of
1976 (17 U.S.C.) to establish a terrestrial broadcast
performance right for sound recordings.
Advisory on Earmarks
In accordance with clause 9 of House rule XXI, H.R. 4130
does not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits as defined in clause 9(d),
9(e), or 9(f) of House rule XXI.
Section-by-Section Analysis
The following discussion describes the bill as reported by
the Committee.
Section 1. Short Title; Table of Contents
Section 1 establishes a short title and table of contents.
Section 2. Equitable Treatment for Terrestrial Broadcasts and Internet
Services
Section 2(a) establishes that there is an exclusive right
for the audio transmission of sound recordings by removing the
current limitation to ``digital'' audio transmission in 17
U.S.C. Sec. 106(6).
Section 2(b) makes changes to allow for the licensing of
this expanded exclusive right under the same statutory license
established in 17 U.S.C. Sec. 114 that is currently used by
internet and satellite radio and makes conforming amendments
throughout the rest of title 17. (Under Sec. 114, the collected
royalties are distributed so that 50% goes to the copyright
owner, 45% goes to the featured artist, and 2.5% goes to each
of two entities, one representing nonfeatured musicians and one
representing nonfeatured vocalists.)
Section 3. Timing of Proceedings Under Sections 112(e) and 114(f)
Section 3 provides that the Copyright Royalty Board shall
begin proceedings immediately to establish the appropriate
public performance royalty rate for terrestrial radio, and that
that rate shall apply to transmissions made between the date of
enactment and December 31, 2028, though payment is not due
until the royalty rate is established. New proceedings shall
occur every five years.
Section 4. Special Protection for Small Broadcasters
Section 4 establishes separate yearly rates for certain
smaller radio stations. For broadcast stations that generated
less than $100,000 in revenue in the proceeding calendar year,
the yearly fee is $10. For public broadcast stations that
generated between $100,000 to $1,500,000 in the proceeding
calendar year, the yearly fee is $100. For all other broadcast
stations that generated between $100,000 to $1,500,000 in the
proceeding calendar year, the yearly fee is $500. These
exceptions do not apply to any station controlled or owned by
another entity whose revenue, combined with that station's
revenue, exceeds $10,000,000. These yearly royalty rates are
not admissible as evidence or to be taken into account in any
royalty rate proceeding for the public performance of sound
recordings.
Section 5. Distribution of Certain Royalties
Section 5 establishes that if a copyright holder directly
contracts with broadcast stations to license terrestrial
performance rights (rather than the broadcast station relying
on the statutory license of Sec. 114), the broadcast station
must still pay 50% of the direct license payment to the entity
administering the Sec. 114 royalty to be distributed to artists
(where it is split as it would be under the Sec. 114 license so
that the featured artist receives 45% and entities representing
nonfeatured musicians and nonfeatured vocalists each receive
2.5%).
Section 6. No Harmful Effects on Songwriters
Section 6 provides that nothing in this Act shall adversely
affect the public performance rights or royalties to be paid to
songwriters or owners of musical works copyrights.
Section 7. Value of Promotion Taken into Account
Section 7 provides that in determining the royalty rate for
terrestrial broadcast public performance of sound recordings,
the Copyright Royalty Board may consider the promotional value
conferred by the broadcast station's playing of the sound
recording.
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, and existing law in which no
change is proposed is shown in roman):
TITLE 17, UNITED STATES CODE
* * * * * * *
CHAPTER 1--SUBJECT MATTER AND SCOPE OF COPYRIGHT
Sec. 101. Definitions
Except as otherwise provided in this title, as used in this
title, the following terms and their variant forms mean the
following:
An ``anonymous work'' is a work on the copies or
phonorecords of which no natural person is identified
as author.
An ``architectural work'' is the design of a building
as embodied in any tangible medium of expression,
including a building, architectural plans, or drawings.
The work includes the overall form as well as the
arrangement and composition of spaces and elements in
the design, but does not include individual standard
features.
An ``audio transmission'' is a transmission of a
sound recording, whether in a digital, analog, or other
format. This term does not include the transmission of
any audiovisual work.
``Audiovisual works'' are works that consist of a
series of related images which are intrinsically
intended to be shown by the use of machines, or devices
such as projectors, viewers, or electronic equipment,
together with accompanying sounds, if any, regardless
of the nature of the material objects, such as films or
tapes, in which the works are embodied.
The ``Berne Convention'' is the Convention for the
Protection of Literary and Artistic Works, signed at
Berne, Switzerland, on September 9, 1886, and all acts,
protocols, and revisions thereto.
The ``best edition'' of a work is the edition,
published in the United States at any time before the
date of deposit, that the Library of Congress
determines to be most suitable for its purposes.
A person's ``children'' are that person's immediate
offspring, whether legitimate or not, and any children
legally adopted by that person.
A ``collective work'' is a work, such as a periodical
issue, anthology, or encyclopedia, in which a number of
contributions, constituting separate and independent
works in themselves, are assembled into a collective
whole.
A ``compilation'' is a work formed by the collection
and assembling of preexisting materials or of data that
are selected, coordinated, or arranged in such a way
that the resulting work as a whole constitutes an
original work of authorship. The term ``compilation''
includes collective works.
A ``computer program'' is a set of statements or
instructions to be used directly or indirectly in a
computer in order to bring about a certain result.
``Copies'' are material objects, other than
phonorecords, in which a work is fixed by any method
now known or later developed, and from which the work
can be perceived, reproduced, or otherwise
communicated, either directly or with the aid of a
machine or device. The term ``copies'' includes the
material object, other than a phonorecord, in which the
work is first fixed.
``Copyright owner'', with respect to any one of the
exclusive rights comprised in a copyright, refers to
the owner of that particular right.
A ``Copyright Royalty Judge'' is a Copyright Royalty
Judge appointed under section 802 of this title, and
includes any individual serving as an interim Copyright
Royalty Judge under such section.
A work is ``created'' when it is fixed in a copy or
phonorecord for the first time; where a work is
prepared over a period of time, the portion of it that
has been fixed at any particular time constitutes the
work as of that time, and where the work has been
prepared in different versions, each version
constitutes a separate work.
A ``derivative work'' is 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''.
A ``device'', ``machine'', or ``process'' is one now
known or later developed.
A ``digital transmission'' is a transmission in whole
or in part in a digital or other non-analog format.
To ``display'' a work means to show a copy of it,
either directly or by means of a film, slide,
television image, or any other device or process or, in
the case of a motion picture or other audiovisual work,
to show individual images nonsequentially.
An ``establishment'' is a store, shop, or any similar
place of business open to the general public for the
primary purpose of selling goods or services in which
the majority of the gross square feet of space that is
nonresidential is used for that purpose, and in which
nondramatic musical works are performed publicly.
The term ``financial gain'' includes receipt, or
expectation of receipt, of anything of value, including
the receipt of other copyrighted works.
A work is ``fixed'' in a tangible medium of
expression when its embodiment in a copy or
phonorecord, by or under the authority of the author,
is sufficiently permanent or stable to permit it to be
perceived, reproduced, or otherwise communicated for a
period of more than transitory duration. A work
consisting of sounds, images, or both, that are being
transmitted, is ``fixed'' for purposes of this title if
a fixation of the work is being made simultaneously
with its transmission.
A ``food service or drinking establishment'' is a
restaurant, inn, bar, tavern, or any other similar
place of business in which the public or patrons
assemble for the primary purpose of being served food
or drink, in which the majority of the gross square
feet of space that is nonresidential is used for that
purpose, and in which nondramatic musical works are
performed publicly.
The ``Geneva Phonograms Convention'' is the
Convention for the Protection of Producers of
Phonograms Against Unauthorized Duplication of Their
Phonograms, concluded at Geneva, Switzerland, on
October 29, 1971.
The ``gross square feet of space'' of an
establishment means the entire interior space of that
establishment, and any adjoining outdoor space used to
serve patrons, whether on a seasonal basis or
otherwise.
The terms ``including'' and ``such as'' are
illustrative and not limitative.
An ``international agreement'' is--
(1) the Universal Copyright Convention;
(2) the Geneva Phonograms Convention;
(3) the Berne Convention;
(4) the WTO Agreement;
(5) the WIPO Copyright Treaty;
(6) the WIPO Performances and Phonograms Treaty; and
(7) any other copyright treaty to which the United
States is a party.
A ``joint work'' is a work prepared by two or more
authors with the intention that their contributions be
merged into inseparable or interdependent parts of a
unitary whole.
``Literary works'' are works, other than audiovisual
works, expressed in words, numbers, or other verbal or
numerical symbols or indicia, regardless of the nature
of the material objects, such as books, periodicals,
manuscripts, phonorecords, film, tapes, disks, or
cards, in which they are embodied.
The term ``motion picture exhibition facility'' means
a movie theater, screening room, or other venue that is
being used primarily for the exhibition of a
copyrighted motion picture, if such exhibition is open
to the public or is made to an assembled group of
viewers outside of a normal circle of a family and its
social acquaintances.
``Motion pictures'' are 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.
To ``perform'' a work means to recite, render, play,
dance, or act it, either directly or by means of any
device or process or, in the case of a motion picture
or other audiovisual work, to show its images in any
sequence or to make the sounds accompanying it audible.
A ``performing rights society'' is an association,
corporation, or other entity that licenses the public
performance of nondramatic musical works on behalf of
copyright owners of such works, such as the American
Society of Composers, Authors and Publishers (ASCAP),
Broadcast Music, Inc. (BMI), and SESAC, Inc.
``Phonorecords'' are material objects in which
sounds, other than those accompanying a motion picture
or other audiovisual work, are fixed by any method now
known or later developed, and from which the sounds can
be perceived, reproduced, or otherwise communicated,
either directly or with the aid of a machine or device.
The term ``phonorecords'' includes the material object
in which the sounds are first fixed.
``Pictorial, graphic, and sculptural works'' include
two-dimensional and three-dimensional works of fine,
graphic, and applied art, photographs, prints and art
reproductions, maps, globes, charts, diagrams, models,
and technical drawings, including architectural plans.
Such works shall include works of artistic
craftsmanship insofar as their form but not their
mechanical or utilitarian aspects are concerned; the
design of a useful article, as defined in this section,
shall be considered a pictorial, graphic, or sculptural
work only if, and only to the extent that, such design
incorporates pictorial, graphic, or sculptural features
that can be identified separately from, and are capable
of existing independently of, the utilitarian aspects
of the article.
For purposes of section 513, a ``proprietor'' is an
individual, corporation, partnership, or other entity,
as the case may be, that owns an establishment or a
food service or drinking establishment, except that no
owner or operator of a radio or television station
licensed by the Federal Communications Commission,
cable system or satellite carrier, cable or satellite
carrier service or programmer, provider of online
services or network access or the operator of
facilities therefor, telecommunications company, or any
other such audio or audiovisual service or programmer
now known or as may be developed in the future,
commercial subscription music service, or owner or
operator of any other transmission service, shall under
any circumstances be deemed to be a proprietor.
A ``pseudonymous work'' is a work on the copies or
phonorecords of which the author is identified under a
fictitious name.
``Publication'' is the distribution of copies or
phonorecords of a work to the public by sale or other
transfer of ownership, or by rental, lease, or lending.
The offering to distribute copies or phonorecords to a
group of persons for purposes of further distribution,
public performance, or public display, constitutes
publication. A public performance or display of a work
does not of itself constitute publication.
To perform or display a work ``publicly'' means--
(1) to perform or display it at a place open to the
public or at any place where a substantial number of
persons outside of a normal circle of a family and its
social acquaintances is gathered; or
(2) to transmit or otherwise communicate a
performance or display of the work to a place specified
by clause (1) or to the public, by means of any device
or process, whether the members of the public capable
of receiving the performance or display receive it in
the same place or in separate places and at the same
time or at different times.
``Registration'', for purposes of sections 205(c)(2),
405, 406, 410(d), 411, 412, and 506(e), means a
registration of a claim in the original or the renewed
and extended term of copyright.
``Sound recordings'' are works that result from the
fixation of a series of musical, spoken, or other
sounds, but not including the sounds accompanying a
motion picture or other audiovisual work, regardless of
the nature of the material objects, such as disks,
tapes, or other phonorecords, in which they are
embodied.
``State'' includes the District of Columbia and the
Commonwealth of Puerto Rico, and any territories to
which this title is made applicable by an Act of
Congress.
A ``transfer of copyright ownership'' is an
assignment, mortgage, exclusive license, or any other
conveyance, alienation, or hypothecation of a copyright
or of any of the exclusive rights comprised in a
copyright, whether or not it is limited in time or
place of effect, but not including a nonexclusive
license.
A ``transmission program'' is a body of material
that, as an aggregate, has been produced for the sole
purpose of transmission to the public in sequence and
as a unit.
To ``transmit'' a performance or display is to
communicate it by any device or process whereby images
or sounds are received beyond the place from which they
are sent.
A ``treaty party'' is a country or intergovernmental
organization other than the United States that is a
party to an international agreement.
The ``United States'', when used in a geographical
sense, comprises the several States, the District of
Columbia and the Commonwealth of Puerto Rico, and the
organized territories under the jurisdiction of the
United States Government.
For purposes of section 411, a work is a ``United
States work'' only if--
(1) in the case of a published work, the work is
first published--
(A) in the United States;
(B) simultaneously in the United States and another
treaty party or parties, whose law grants a term of
copyright protection that is the same as or longer than
the term provided in the United States;
(C) simultaneously in the United States and a foreign
nation that is not a treaty party; or
(D) in a foreign nation that is not a treaty party,
and all of the authors of the work are nationals,
domiciliaries, or habitual residents of, or in the case
of an audiovisual work legal entities with headquarters
in, the United States;
(2) in the case of an unpublished work, all the
authors of the work are nationals, domiciliaries, or
habitual residents of the United States, or, in the
case of an unpublished audiovisual work, all the
authors are legal entities with headquarters in the
United States; or
(3) in the case of a pictorial, graphic, or
sculptural work incorporated in a building or
structure, the building or structure is located in the
United States.
A ``useful article'' is an article having an
intrinsic utilitarian function that is not merely to
portray the appearance of the article or to convey
information. An article that is normally a part of a
useful article is considered a ``useful article''.
The author's ``widow'' or ``widower'' is the author's
surviving spouse under the law of the author's domicile
at the time of his or her death, whether or not the
spouse has later remarried.
The ``WIPO Copyright Treaty'' is the WIPO Copyright
Treaty concluded at Geneva, Switzerland, on December
20, 1996.
The ``WIPO Performances and Phonograms Treaty'' is
the WIPO Performances and Phonograms Treaty concluded
at Geneva, Switzerland, on December 20, 1996.
A ``work of visual art'' is--
(1) a painting, drawing, print, or sculpture,
existing in a single copy, in a limited edition of 200
copies or fewer that are signed and consecutively
numbered by the author, or, in the case of a sculpture,
in multiple cast, carved, or fabricated sculptures of
200 or fewer that are consecutively numbered by the
author and bear the signature or other identifying mark
of the author; or
(2) a still photographic image produced for
exhibition purposes only, existing in a single copy
that is signed by the author, or in a limited edition
of 200 copies or fewer that are signed and
consecutively numbered by the author.
A work of visual art does not include--
(A)(i) any poster, map, globe, chart, technical
drawing, diagram, model, applied art, motion picture or
other audiovisual work, book, magazine, newspaper,
periodical, data base, electronic information service,
electronic publication, or similar publication;
(ii) any merchandising item or advertising,
promotional, descriptive, covering, or packaging
material or container;
(iii) any portion or part of any item described in
clause (i) or (ii);
(B) any work made for hire; or
(C) any work not subject to copyright protection
under this title.
A ``work of the United States Government'' is a work
prepared by an officer or employee of the United States
Government as part of that person's official duties.
A ``work made for hire'' is--
(1) a work prepared by an employee within the scope
of his or her employment; or
(2) a work specially ordered or commissioned for use
as a contribution to a collective work, as a part of a
motion picture or other audiovisual work, as a
translation, as a supplementary work, as a compilation,
as an instructional text, as a test, as answer material
for a test, or as an atlas, if the parties expressly
agree in a written instrument signed by them that the
work shall be considered a work made for hire. For the
purpose of the foregoing sentence, a ``supplementary
work'' is a work prepared for publication as a
secondary adjunct to a work by another author for the
purpose of introducing, concluding, illustrating,
explaining, revising, commenting upon, or assisting in
the use of the other work, such as forewords,
afterwords, pictorial illustrations, maps, charts,
tables, editorial notes, musical arrangements, answer
material for tests, bibliographies, appendixes, and
indexes, and an ``instructional text'' is a literary,
pictorial, or graphic work prepared for publication and
with the purpose of use in systematic instructional
activities.
In determining whether any work is eligible to be
considered a work made for hire under paragraph (2),
neither the amendment contained in section 1011(d) of
the Intellectual Property and Communications Omnibus
Reform Act of 1999, as enacted by section 1000(a)(9) of
Public Law 106-113, nor the deletion of the words added
by that amendment--
(A) shall be considered or otherwise given any legal
significance, or
(B) shall be interpreted to indicate congressional
approval or disapproval of, or acquiescence in, any
judicial determination,
by the courts or the Copyright Office. Paragraph (2)
shall be interpreted as if both section 2(a)(1) of the
Work Made For Hire and Copyright Corrections Act of
2000 and section 1011(d) of the Intellectual Property
and Communications Omnibus Reform Act of 1999, as
enacted by section 1000(a)(9) of Public Law 106-113,
were never enacted, and without regard to any inaction
or awareness by the Congress at any time of any
judicial determinations.
The terms ``WTO Agreement'' and ``WTO member
country'' have the meanings given those terms in
paragraphs (9) and (10), respectively, of section 2 of
the Uruguay Round Agreements Act.
* * * * * * *
Sec. 106. Exclusive rights in copyrighted works
Subject to sections 107 through 122, the owner of copyright
under this title has the exclusive rights to do and to
authorize any of the following:
(1) to reproduce the copyrighted work in copies or
phonorecords;
(2) to prepare derivative works based upon the
copyrighted work;
(3) to distribute copies or phonorecords of the
copyrighted work to the public by sale or other
transfer of ownership, or by rental, lease, or lending;
(4) in the case of literary, musical, dramatic, and
choreographic works, pantomimes, and motion pictures
and other audiovisual works, to perform the copyrighted
work publicly;
(5) in the case of literary, musical, dramatic, and
choreographic works, pantomimes, and pictorial,
graphic, or sculptural works, including the individual
images of a motion picture or other audiovisual work,
to display the copyrighted work publicly; and
[(6) in the case of sound recordings, to perform the
copyrighted work publicly by means of a digital audio
transmission.]
(6) in the case of sound recordings, to perform the
copyrighted work publicly by means of an audio
transmission.
* * * * * * *
Sec. 112. Limitations on exclusive rights: Ephemeral recordings
(a)(1) Notwithstanding the provisions of section 106, and
except in the case of a motion picture or other audiovisual
work, it is not an infringement of copyright for a transmitting
organization entitled to transmit to the public a performance
or display of a work, under a license, including a statutory
license under section 114(f), or transfer of the copyright or
under the limitations on exclusive rights in sound recordings
specified by section 114(a), or for a transmitting organization
that is a broadcast radio or television station licensed as
such by the Federal Communications Commission and that makes a
broadcast transmission of a performance of a sound recording in
a digital format on a nonsubscription basis, to make no more
than one copy or phonorecord of a particular transmission
program embodying the performance or display, if--
(A) the copy or phonorecord is retained and used
solely by the transmitting organization that made it,
and no further copies or phonorecords are reproduced
from it; and
(B) the copy or phonorecord is used solely for the
transmitting organization's own transmissions within
its local service area, or for purposes of archival
preservation or security; and
(C) unless preserved exclusively for archival
purposes, the copy or phonorecord is destroyed within
six months from the date the transmission program was
first transmitted to the public.
(2) In a case in which a transmitting organization entitled
to make a copy or phonorecord under paragraph (1) in connection
with the transmission to the public of a performance or display
of a work is prevented from making such copy or phonorecord by
reason of the application by the copyright owner of technical
measures that prevent the reproduction of the work, the
copyright owner shall make available to the transmitting
organization the necessary means for permitting the making of
such copy or phonorecord as permitted under that paragraph, if
it is technologically feasible and economically reasonable for
the copyright owner to do so. If the copyright owner fails to
do so in a timely manner in light of the transmitting
organization's reasonable business requirements, the
transmitting organization shall not be liable for a violation
of section 1201(a)(1) of this title for engaging in such
activities as are necessary to make such copies or phonorecords
as permitted under paragraph (1) of this subsection.
(b) Notwithstanding the provisions of section 106, it is not
an infringement of copyright for a governmental body or other
nonprofit organization entitled to transmit a performance or
display of a work, under section 110(2) or under the
limitations on exclusive rights in sound recordings specified
by section 114(a), to make no more than thirty copies or
phonorecords of a particular transmission program embodying the
performance or display, if--
(1) no further copies or phonorecords are reproduced
from the copies or phonorecords made under this clause;
and
(2) except for one copy or phonorecord that may be
preserved exclusively for archival purposes, the copies
or phonorecords are destroyed within seven years from
the date the transmission program was first transmitted
to the public.
(c) Notwithstanding the provisions of section 106, it is not
an infringement of copyright for a governmental body or other
nonprofit organization to make for distribution no more than
one copy or phonorecord, for each transmitting organization
specified in clause (2) of this subsection, of a particular
transmission program embodying a performance of a nondramatic
musical work of a religious nature, or of a sound recording of
such a musical work, if--
(1) there is no direct or indirect charge for making
or distributing any such copies or phonorecords; and
(2) none of such copies or phonorecords is used for
any performance other than a single transmission to the
public by a transmitting organization entitled to
transmit to the public a performance of the work under
a license or transfer of the copyright; and
(3) except for one copy or phonorecord that may be
preserved exclusively for archival purposes, the copies
or phonorecords are all destroyed within one year from
the date the transmission program was first transmitted
to the public.
(d) Notwithstanding the provisions of section 106, it is not
an infringement of copyright for a governmental body or other
nonprofit organization entitled to transmit a performance of a
work under section 110(8) to make no more than ten copies or
phonorecords embodying the performance, or to permit the use of
any such copy or phonorecord by any governmental body or
nonprofit organization entitled to transmit a performance of a
work under section 110(8), if--
(1) any such copy or phonorecord is retained and used
solely by the organization that made it, or by a
governmental body or nonprofit organization entitled to
transmit a performance of a work under section 110(8),
and no further copies or phonorecords are reproduced
from it; and
(2) any such copy or phonorecord is used solely for
transmissions authorized under section 110(8), or for
purposes of archival preservation or security; and
(3) the governmental body or nonprofit organization
permitting any use of any such copy or phonorecord by
any governmental body or nonprofit organization under
this subsection does not make any charge for such use.
(e) Statutory License.--(1) A transmitting organization
entitled to transmit to the public a performance of a sound
recording under the limitation on exclusive rights specified by
section 114(d)(1)(C)(iv) or under a statutory license in
accordance with section 114(f) is entitled to a statutory
license, under the conditions specified by this subsection, to
make no more than 1 phonorecord of the sound recording (unless
the terms and conditions of the statutory license allow for
more), if the following conditions are satisfied:
(A) The phonorecord is retained and used solely by
the transmitting organization that made it, and no
further phonorecords are reproduced from it.
(B) The phonorecord is used solely for the
transmitting organization's own transmissions
originating in the United States under a statutory
license in accordance with section 114(f) or the
limitation on exclusive rights specified by section
114(d)(1)(C)(iv).
(C) Unless preserved exclusively for purposes of
archival preservation, the phonorecord is destroyed
within 6 months from the date the sound recording was
first transmitted to the public using the phonorecord.
(D) Phonorecords of the sound recording have been
distributed to the public under the authority of the
copyright owner or the copyright owner authorizes the
transmitting entity to transmit the sound recording,
and the transmitting entity makes the phonorecord under
this subsection from a phonorecord lawfully made and
acquired under the authority of the copyright owner.
(2) Notwithstanding any provision of the antitrust laws, any
copyright owners of sound recordings and any transmitting
organizations entitled to a statutory license under this
subsection may negotiate and agree upon royalty rates and
license terms and conditions for making phonorecords of such
sound recordings under this section and the proportionate
division of fees paid among copyright owners, and may designate
common agents to negotiate, agree to, pay, or receive such
royalty payments.
(3) Proceedings under chapter 8 shall determine reasonable
rates and terms of royalty payments for the activities
specified by paragraph (1) during the 5-year period beginning
on January 1 of the second year following the year in which the
proceedings are to be commenced, or such other period as the
parties may agree. Such rates shall include a minimum fee for
each type of service offered by transmitting organizations. Any
copyright owners of sound recordings or any transmitting
organizations entitled to a statutory license under this
subsection may submit to the Copyright Royalty Judges licenses
covering such activities with respect to such sound recordings.
The parties to each proceeding shall bear their own costs.
(4) The schedule of reasonable rates and terms determined by
the Copyright Royalty Judges shall, subject to paragraph (5),
be binding on all copyright owners of sound recordings and
transmitting organizations entitled to a statutory license
under this subsection during the 5-year period specified in
paragraph (3), or such other period as the parties may agree.
Such rates shall include a minimum fee for each type of service
offered by transmitting organizations. The Copyright Royalty
Judges shall establish rates that most clearly represent the
fees that would have been negotiated in the marketplace between
a willing buyer and a willing seller. In determining such rates
and terms, the Copyright Royalty Judges shall base their
decision on economic, competitive, and programming information
presented by the parties, including--
(A) whether use of the service may substitute for or
may promote the sales of phonorecords or otherwise
interferes with or enhances the copyright owner's
traditional streams of revenue; and
(B) the relative roles of the copyright owner and the
transmitting organization in the copyrighted work and
the service made available to the public with respect
to relative creative contribution, technological
contribution, capital investment, cost, and risk.
In establishing such rates and terms, the Copyright Royalty
Judges may consider the rates and terms under voluntary license
agreements described in paragraphs (2) and (3). The Copyright
Royalty Judges shall also establish requirements by which
copyright owners may receive reasonable notice of the use of
their sound recordings under this section, and under which
records of such use shall be kept and made available by
transmitting organizations entitled to obtain a statutory
license under this subsection.
(5) License agreements voluntarily negotiated at any time
between 1 or more copyright owners of sound recordings and 1 or
more transmitting organizations entitled to obtain a statutory
license under this subsection shall be given effect in lieu of
any decision by the Librarian of Congress or determination by
the Copyright Royalty Judges.
(6)(A) Any person who wishes to make a phonorecord of a sound
recording under a statutory license in accordance with this
subsection may do so without infringing the exclusive right of
the copyright owner of the sound recording under section
106(1)--
(i) by complying with such notice requirements as the
Copyright Royalty Judges shall prescribe by regulation
and by paying royalty fees in accordance with this
subsection; or
(ii) if such royalty fees have not been set, by
agreeing to pay such royalty fees as shall be
determined in accordance with this subsection.
(B) Any royalty payments in arrears shall be made on or
before the 20th day of the month next succeeding the month in
which the royalty fees are set.
(7) If a transmitting organization entitled to make a
phonorecord under this subsection is prevented from making such
phonorecord by reason of the application by the copyright owner
of technical measures that prevent the reproduction of the
sound recording, the copyright owner shall make available to
the transmitting organization the necessary means for
permitting the making of such phonorecord as permitted under
this subsection, if it is technologically feasible and
economically reasonable for the copyright owner to do so. If
the copyright owner fails to do so in a timely manner in light
of the transmitting organization's reasonable business
requirements, the transmitting organization shall not be liable
for a violation of section 1201(a)(1) of this title for
engaging in such activities as are necessary to make such
phonorecords as permitted under this subsection.
(8) Nothing in this subsection annuls, limits, impairs, or
otherwise affects in any way the existence or value of any of
the exclusive rights of the copyright owners in a sound
recording, except as otherwise provided in this subsection, or
in a musical work, including the exclusive rights to reproduce
and distribute a sound recording or musical work, including by
means of a digital phonorecord delivery, under sections 106(1),
106(3), and 115, and the right to perform publicly a sound
recording or musical work, including by means of [a digital
audio transmission] an audio transmission, under sections
106(4) and 106(6).
(f)(1) Notwithstanding the provisions of section 106, and
without limiting the application of subsection (b), it is not
an infringement of copyright for a governmental body or other
nonprofit educational institution entitled under section 110(2)
to transmit a performance or display to make copies or
phonorecords of a work that is in digital form and, solely to
the extent permitted in paragraph (2), of a work that is in
analog form, embodying the performance or display to be used
for making transmissions authorized under section 110(2), if--
(A) such copies or phonorecords are retained and used
solely by the body or institution that made them, and
no further copies or phonorecords are reproduced from
them, except as authorized under section 110(2); and
(B) such copies or phonorecords are used solely for
transmissions authorized under section 110(2).
(2) This subsection does not authorize the conversion of
print or other analog versions of works into digital formats,
except that such conversion is permitted hereunder, only with
respect to the amount of such works authorized to be performed
or displayed under section 110(2), if--
(A) no digital version of the work is available to
the institution; or
(B) the digital version of the work that is available
to the institution is subject to technological
protection measures that prevent its use for section
110(2).
(g) The transmission program embodied in a copy or
phonorecord made under this section is not subject to
protection as a derivative work under this title except with
the express consent of the owners of copyright in the
preexisting works employed in the program.
* * * * * * *
Sec. 114. Scope of exclusive rights in sound recordings
(a) The exclusive rights of the owner of copyright in a sound
recording are limited to the rights specified by clauses (1),
(2), (3) and (6) of section 106, and do not include any right
of performance under section 106(4).
(b) The exclusive right of the owner of copyright in a sound
recording under clause (1) of section 106 is limited to the
right to duplicate the sound recording in the form of
phonorecords or copies that directly or indirectly recapture
the actual sounds fixed in the recording. The exclusive right
of the owner of copyright in a sound recording under clause (2)
of section 106 is limited to the right to prepare a derivative
work in which the actual sounds fixed in the sound recording
are rearranged, remixed, or otherwise altered in sequence or
quality. The exclusive rights of the owner of copyright in a
sound recording under clauses (1) and (2) of section 106 do not
extend to the making or duplication of another sound recording
that consists entirely of an independent fixation of other
sounds, even though such sounds imitate or simulate those in
the copyrighted sound recording. The exclusive rights of the
owner of copyright in a sound recording under clauses (1), (2),
and (3) of section 106 do not apply to sound recordings
included in educational television and radio programs (as
defined in section 397 of title 47) distributed or transmitted
by or through public broadcasting entities (as defined by
section 118(f)): Provided, That copies or phonorecords of said
programs are not commercially distributed by or through public
broadcasting entities to the general public.
(c) This section does not limit or impair the exclusive right
to perform publicly, by means of a phonorecord, any of the
works specified by section 106(4).
(d) Limitations on Exclusive Right.--Notwithstanding the
provisions of section 106(6)--
(1) Exempt transmissions and retransmissions.--The
performance of a sound recording publicly by means of
[a digital] an audio transmission, other than as a part
of an interactive service, is not an infringement of
section 106(6) if the performance is part of--
[(A) a nonsubscription broadcast
transmission;]
[(B)] (A) a retransmission of a
[nonsubscription] licensed nonsubscription
broadcast transmission: Provided, That, in the
case of a retransmission of a radio station's
broadcast transmission--
(i) the radio station's broadcast
transmission is not willfully or
repeatedly retransmitted more than a
radius of 150 miles from the site of
the radio broadcast transmitter,
however--
(I) the 150 mile limitation
under this clause shall not
apply when a [nonsubscription]
licensed nonsubscription
broadcast transmission by a
radio station licensed by the
Federal Communications
Commission is retransmitted on
a nonsubscription basis by a
terrestrial broadcast station,
terrestrial translator, or
terrestrial repeater licensed
by the Federal Communications
Commission; and
(II) in the case of a
subscription retransmission of
a [nonsubscription] licensed
nonsubscription broadcast
retransmission covered by
subclause (I), the 150 mile
radius shall be measured from
the transmitter site of such
broadcast retransmitter;
(ii) the retransmission is of radio
station broadcast transmissions that
are--
(I) obtained by the
retransmitter over the air;
(II) not electronically
processed by the retransmitter
to deliver separate and
discrete signals; and
(III) retransmitted only
within the local communities
served by the retransmitter;
(iii) the radio station's broadcast
transmission was being retransmitted to
cable systems (as defined in section
111(f)) by a satellite carrier on
January 1, 1995, and that
retransmission was being retransmitted
by cable systems as a separate and
discrete signal, and the satellite
carrier obtains the radio station's
broadcast transmission in an analog
format: Provided, That the broadcast
transmission being retransmitted may
embody the programming of no more than
one radio station; or
(iv) the radio station's broadcast
transmission is made by a noncommercial
educational broadcast station funded on
or after January 1, 1995, under section
396(k) of the Communications Act of
1934 (47 U.S.C. 396(k)), consists
solely of noncommercial educational and
cultural radio programs, and the
retransmission, whether or not
simultaneous, is a [nonsubscription]
licensed nonsubscription terrestrial
broadcast retransmission; or
[(C)] (B) a transmission that comes within
any of the following categories--
(i) a prior or simultaneous
transmission incidental to an exempt
transmission, such as a feed received
by and then retransmitted by an exempt
transmitter: Provided, That such
incidental transmissions do not include
any subscription transmission directly
for reception by members of the public;
(ii) a transmission within a business
establishment, confined to its premises
or the immediately surrounding
vicinity;
(iii) a retransmission by any
retransmitter, including a multichannel
video programming distributor as
defined in section 602(12) of the
Communications Act of 1934 (47 U.S.C.
522(12)), of a transmission by a
transmitter licensed to publicly
perform the sound recording as a part
of that transmission, if the
retransmission is simultaneous with the
licensed transmission and authorized by
the transmitter; or
(iv) a transmission to a business
establishment for use in the ordinary
course of its business: Provided, That
the business recipient does not
retransmit the transmission outside of
its premises or the immediately
surrounding vicinity, and that the
transmission does not exceed the sound
recording performance complement.
Nothing in this clause shall limit the
scope of the exemption in clause (ii).
(2) Statutory licensing of certain transmissions.--
The performance of a sound recording publicly by means
of a [subscription digital] subscription audio
transmission not exempt under paragraph (1), an
eligible nonsubscription transmission, or a
transmission not exempt under paragraph (1) that is
made by a preexisting satellite digital audio radio
service shall be subject to statutory licensing, in
accordance with subsection (f) if--
(A)(i) the transmission is not part of an
interactive service;
(ii) except in the case of a transmission to
a business establishment, the transmitting
entity does not automatically and intentionally
cause any device receiving the transmission to
switch from one program channel to another; and
(iii) except as provided in section 1002(e),
the transmission of the sound recording is
accompanied, if technically feasible, by the
information encoded in that sound recording, if
any, by or under the authority of the copyright
owner of that sound recording, that identifies
the title of the sound recording, the featured
recording artist who performs on the sound
recording, and related information, including
information concerning the underlying musical
work and its writer;
(B) in the case of a subscription
transmission not exempt under paragraph (1)
that is made by a preexisting subscription
service in the same transmission medium used by
such service on July 31, 1998, or in the case
of a transmission not exempt under paragraph
(1) that is made by a preexisting satellite
digital audio radio service--
(i) the transmission does not exceed
the sound recording performance
complement; and
(ii) the transmitting entity does not
cause to be published by means of an
advance program schedule or prior
announcement the titles of the specific
sound recordings or phonorecords
embodying such sound recordings to be
transmitted; and
(C) in the case of an eligible
nonsubscription transmission or a subscription
transmission not exempt under paragraph (1)
that is made by a new subscription service or
by a preexisting subscription service other
than in the same transmission medium used by
such service on July 31, 1998--
(i) the transmission does not exceed
the sound recording performance
complement, except that this
requirement shall not apply in the case
of a retransmission of a broadcast
transmission if the retransmission is
made by a transmitting entity that does
not have the right or ability to
control the programming of the
broadcast station making the broadcast
transmission, unless--
(I) the broadcast station
makes broadcast transmissions--
(aa) in digital
format that regularly
exceed the sound
recording performance
complement; or
(bb) in analog
format, a substantial
portion of which, on a
weekly basis, exceed
the sound recording
performance complement;
and
(II) the sound recording
copyright owner or its
representative has notified the
transmitting entity in writing
that broadcast transmissions of
the copyright owner's sound
recordings exceed the sound
recording performance
complement as provided in this
clause;
(ii) the transmitting entity does not
cause to be published, or induce or
facilitate the publication, by means of
an advance program schedule or prior
announcement, the titles of the
specific sound recordings to be
transmitted, the phonorecords embodying
such sound recordings, or, other than
for illustrative purposes, the names of
the featured recording artists, except
that this clause does not disqualify a
transmitting entity that makes a prior
announcement that a particular artist
will be featured within an unspecified
future time period, and in the case of
a retransmission of a broadcast
transmission by a transmitting entity
that does not have the right or ability
to control the programming of the
broadcast transmission, the requirement
of this clause shall not apply to a
prior oral announcement by the
broadcast station, or to an advance
program schedule published, induced, or
facilitated by the broadcast station,
if the transmitting entity does not
have actual knowledge and has not
received written notice from the
copyright owner or its representative
that the broadcast station publishes or
induces or facilitates the publication
of such advance program schedule, or if
such advance program schedule is a
schedule of classical music programming
published by the broadcast station in
the same manner as published by that
broadcast station on or before
September 30, 1998;
(iii) the transmission--
(I) is not part of an
archived program of less than 5
hours duration;
(II) is not part of an
archived program of 5 hours or
greater in duration that is
made available for a period
exceeding 2 weeks;
(III) is not part of a
continuous program which is of
less than 3 hours duration; or
(IV) is not part of an
identifiable program in which
performances of sound
recordings are rendered in a
predetermined order, other than
an archived or continuous
program, that is transmitted
at--
(aa) more than 3
times in any 2-week
period that have been
publicly announced in
advance, in the case of
a program of less than
1 hour in duration, or
(bb) more than 4
times in any 2-week
period that have been
publicly announced in
advance, in the case of
a program of 1 hour or
more in duration,
except that the requirement of this
subclause shall not apply in the case
of a retransmission of a broadcast
transmission by a transmitting entity
that does not have the right or ability
to control the programming of the
broadcast transmission, unless the
transmitting entity is given notice in
writing by the copyright owner of the
sound recording that the broadcast
station makes broadcast transmissions
that regularly violate such
requirement;
(iv) the transmitting entity does not
knowingly perform the sound recording,
as part of a service that offers
transmissions of visual images
contemporaneously with transmissions of
sound recordings, in a manner that is
likely to cause confusion, to cause
mistake, or to deceive, as to the
affiliation, connection, or association
of the copyright owner or featured
recording artist with the transmitting
entity or a particular product or
service advertised by the transmitting
entity, or as to the origin,
sponsorship, or approval by the
copyright owner or featured recording
artist of the activities of the
transmitting entity other than the
performance of the sound recording
itself;
(v) the transmitting entity
cooperates to prevent, to the extent
feasible without imposing substantial
costs or burdens, a transmission
recipient or any other person or entity
from automatically scanning the
transmitting entity's transmissions
alone or together with transmissions by
other transmitting entities in order to
select a particular sound recording to
be transmitted to the transmission
recipient, except that the requirement
of this clause shall not apply to a
satellite digital audio service that is
in operation, or that is licensed by
the Federal Communications Commission,
on or before July 31, 1998;
(vi) the transmitting entity takes no
affirmative steps to cause or induce
the making of a phonorecord by the
transmission recipient, and if the
technology used by the transmitting
entity enables the transmitting entity
to limit the making by the transmission
recipient of phonorecords of the
transmission directly in a digital
format, the transmitting entity sets
such technology to limit such making of
phonorecords to the extent permitted by
such technology;
(vii) phonorecords of the sound
recording have been distributed to the
public under the authority of the
copyright owner or the copyright owner
authorizes the transmitting entity to
transmit the sound recording, and the
transmitting entity makes the
transmission from a phonorecord
lawfully made under the authority of
the copyright owner, except that the
requirement of this clause shall not
apply to a retransmission of a
broadcast transmission by a
transmitting entity that does not have
the right or ability to control the
programming of the broadcast
transmission, unless the transmitting
entity is given notice in writing by
the copyright owner of the sound
recording that the broadcast station
makes broadcast transmissions that
regularly violate such requirement;
(viii) the transmitting entity
accommodates and does not interfere
with the transmission of technical
measures that are widely used by sound
recording copyright owners to identify
or protect copyrighted works, and that
are technically feasible of being
transmitted by the transmitting entity
without imposing substantial costs on
the transmitting entity or resulting in
perceptible aural or visual degradation
of the [digital signal] signal, except
that the requirement of this clause
shall not apply to a satellite digital
audio service that is in operation, or
that is licensed under the authority of
the Federal Communications Commission,
on or before July 31, 1998, to the
extent that such service has designed,
developed, or made commitments to
procure equipment or technology that is
not compatible with such technical
measures before such technical measures
are widely adopted by sound recording
copyright owners; and
(ix) the transmitting entity
identifies in textual data the sound
recording during, but not before, the
time it is performed, including the
title of the sound recording, the title
of the phonorecord embodying such sound
recording, if any, and the featured
recording artist, in a manner to permit
it to be displayed to the transmission
recipient by the device or technology
intended for receiving the service
provided by the transmitting entity,
except that the obligation in this
clause shall not take effect until 1
year after the date of the enactment of
the Digital Millennium Copyright Act
and shall not apply in the case of a
retransmission of a broadcast
transmission by a transmitting entity
that does not have the right or ability
to control the programming of the
broadcast transmission, or in the case
in which devices or technology intended
for receiving the service provided by
the transmitting entity that have the
capability to display such textual data
are not common in the marketplace.
(3) Licenses for transmissions by interactive
services.--
(A) No interactive service shall be granted
an exclusive license under section 106(6) for
the performance of a sound recording publicly
by means of digital audio transmission for a
period in excess of 12 months, except that with
respect to an exclusive license granted to an
interactive service by a licensor that holds
the copyright to 1,000 or fewer sound
recordings, the period of such license shall
not exceed 24 months: Provided, however, That
the grantee of such exclusive license shall be
ineligible to receive another exclusive license
for the performance of that sound recording for
a period of 13 months from the expiration of
the prior exclusive license.
(B) The limitation set forth in subparagraph
(A) of this paragraph shall not apply if--
(i) the licensor has granted and
there remain in effect licenses under
section 106(6) for the public
performance of sound recordings by
means of digital audio transmission by
at least 5 different interactive
services: Provided, however, That each
such license must be for a minimum of
10 percent of the copyrighted sound
recordings owned by the licensor that
have been licensed to interactive
services, but in no event less than 50
sound recordings; or
(ii) the exclusive license is granted
to perform publicly up to 45 seconds of
a sound recording and the sole purpose
of the performance is to promote the
distribution or performance of that
sound recording.
(C) Notwithstanding the grant of an exclusive
or nonexclusive license of the right of public
performance under section 106(6), an
interactive service may not publicly perform a
sound recording unless a license has been
granted for the public performance of any
copyrighted musical work contained in the sound
recording: Provided, That such license to
publicly perform the copyrighted musical work
may be granted either by a performing rights
society representing the copyright owner or by
the copyright owner.
(D) The performance of a sound recording by
means of a retransmission of a digital audio
transmission is not an infringement of section
106(6) if--
(i) the retransmission is of a
transmission by an interactive service
licensed to publicly perform the sound
recording to a particular member of the
public as part of that transmission;
and
(ii) the retransmission is
simultaneous with the licensed
transmission, authorized by the
transmitter, and limited to that
particular member of the public
intended by the interactive service to
be the recipient of the transmission.
(E) For the purposes of this paragraph--
(i) a ``licensor'' shall include the
licensing entity and any other entity
under any material degree of common
ownership, management, or control that
owns copyrights in sound recordings;
and
(ii) a ``performing rights society''
is an association or corporation that
licenses the public performance of
nondramatic musical works on behalf of
the copyright owner, such as the
American Society of Composers, Authors
and Publishers, Broadcast Music, Inc.,
and SESAC, Inc.
(4) Rights not otherwise limited.--
(A) Except as expressly provided in this
section, this section does not limit or impair
the exclusive right to perform a sound
recording publicly by means of [a digital audio
transmission] an audio transmission under
section 106(6).
(B) Nothing in this section annuls or limits
in any way--
(i) the exclusive right to publicly
perform a musical work, including by
means of [a digital audio transmission]
an audio transmission, under section
106(4);
(ii) the exclusive rights in a sound
recording or the musical work embodied
therein under sections 106(1), 106(2)
and 106(3); or
(iii) any other rights under any
other clause of section 106, or
remedies available under this title, as
such rights or remedies exist either
before or after the date of enactment
of the Digital Performance Right in
Sound Recordings Act of 1995.
(C) Any limitations in this section on the
exclusive right under section 106(6) apply only
to the exclusive right under section 106(6) and
not to any other exclusive rights under section
106. Nothing in this section shall be construed
to annul, limit, impair or otherwise affect in
any way the ability of the owner of a copyright
in a sound recording to exercise the rights
under sections 106(1), 106(2) and 106(3), or to
obtain the remedies available under this title
pursuant to such rights, as such rights and
remedies exist either before or after the date
of enactment of the Digital Performance Right
in Sound Recordings Act of 1995.
(e) Authority for Negotiations.--
(1) Notwithstanding any provision of the antitrust
laws, in negotiating statutory licenses in accordance
with subsection (f), any copyright owners of sound
recordings and any entities performing sound recordings
affected by this section may negotiate and agree upon
the royalty rates and license terms and conditions for
the performance of such sound recordings and the
proportionate division of fees paid among copyright
owners, and may designate common agents on a
nonexclusive basis to negotiate, agree to, pay, or
receive payments.
(2) For licenses granted under section 106(6), other
than statutory licenses, such as for performances by
interactive services or performances that exceed the
sound recording performance complement--
(A) copyright owners of sound recordings
affected by this section may designate common
agents to act on their behalf to grant licenses
and receive and remit royalty payments:
Provided, That each copyright owner shall
establish the royalty rates and material
license terms and conditions unilaterally, that
is, not in agreement, combination, or concert
with other copyright owners of sound
recordings; and
(B) entities performing sound recordings
affected by this section may designate common
agents to act on their behalf to obtain
licenses and collect and pay royalty fees:
Provided, That each entity performing sound
recordings shall determine the royalty rates
and material license terms and conditions
unilaterally, that is, not in agreement,
combination, or concert with other entities
performing sound recordings.
(f) Licenses for Certain Nonexempt Transmissions.--
(1)(A) Proceedings under chapter 8 shall determine
reasonable rates and terms of royalty payments for
transmissions subject to statutory licensing under
subsection (d)(2) during the 5-year period beginning on
January 1 of the second year following the year in
which the proceedings are to be commenced pursuant to
subparagraph (A) or (B) of section 804(b)(3), as the
case may be, or such other period as the parties may
agree. The parties to each proceeding shall bear their
own costs.
(B) The schedule of reasonable rates and terms
determined by the Copyright Royalty Judges shall,
subject to paragraph (2), be binding on all copyright
owners of sound recordings and entities performing
sound recordings affected by this paragraph during the
5-year period specified in subparagraph (A), or such
other period as the parties may agree. Such rates and
terms shall distinguish among the different types of
services then in operation and shall include a minimum
fee for each such type of service, such differences to
be based on criteria including the quantity and nature
of the use of sound recordings and the degree to which
use of the service may substitute for or may promote
the purchase of phonorecords by consumers. The
Copyright Royalty Judges shall establish rates and
terms that most clearly represent the rates and terms
that would have been negotiated in the marketplace
between a willing buyer and a willing seller. In
determining such rates and terms, the Copyright Royalty
Judges--
(i) shall base their decision on economic,
competitive, and programming information
presented by the parties, including--
(I) whether use of the service may
substitute for or may promote the sales
of phonorecords or otherwise may
interfere with or may enhance the sound
recording copyright owner's other
streams of revenue from the copyright
owner's sound recordings; and
(II) the relative roles of the
copyright owner and the transmitting
entity in the copyrighted work and the
service made available to the public
with respect to relative creative
contribution, technological
contribution, capital investment, cost,
and risk; and
(ii) may consider the rates and terms for
comparable types of audio transmission services
and comparable circumstances under voluntary
license agreements.
(C) The procedures under subparagraphs (A) and (B)
shall also be initiated pursuant to a petition filed by
any sound recording copyright owner or any transmitting
entity indicating that a new type of service on which
sound recordings are performed is or is about to become
operational, for the purpose of determining reasonable
terms and rates of royalty payments with respect to
such new type of service for the period beginning with
the inception of such new type of service and ending on
the date on which the royalty rates and terms for
eligible nonsubscription services and new subscription
services, or preexisting subscription services and
preexisting satellite digital audio radio services, as
the case may be, most recently determined under
subparagraph (A) or (B) and chapter 8 expire, or such
other period as the parties may agree.
(D)(i) Notwithstanding the provisions of
subparagraphs (A) through (C), the royalty rate
shall be as follows for nonsubscription
broadcast transmissions by each individual
terrestrial broadcast station licensed as such
by the Federal Communications Commission that
satisfies the conditions in clause (ii)--
(I) $10 per calendar year, in the
case of nonsubscription broadcast
transmissions by a broadcast station
that generated revenue in the
immediately preceding calendar year of
less than $100,000;
(II) $100 per calendar year, in the
case of nonsubscription broadcast
transmissions by a broadcast station
that is a public broadcasting entity as
defined in section 118(f) and generated
revenue in the immediately preceding
calendar year of $100,000 or more, but
less than $1,500,000; and
(III) $500 per calendar year, in the
case of nonsubscription broadcast
transmissions by a broadcast station
that is not a public broadcasting
entity as defined in section 118(f) and
generated revenue in the immediately
preceding calendar year of $100,000 or
more, but less than $1,500,000.
(ii) An individual terrestrial broadcast
station licensed as such by the Federal
Communications Commission is eligible for a
royalty rate set forth in clause (i) if--
(I) the revenue from the operation of
that individual station was less than
$1,500,000 during the immediately
preceding calendar year;
(II) the aggregate revenue of the
owner and operator of the broadcast
station and any person directly or
indirectly controlling, controlled by,
or under common control with such owner
or operator, from any source, was less
than $10,000,000 during the immediately
preceding calendar year; and
(III) the owner or operator of the
broadcast station provides to the
nonprofit collective designated by the
Copyright Royalty Judges to distribute
receipts from the licensing of
transmissions in accordance with
subsection (f), by no later than
January 31 of the relevant calendar
year, a written and signed
certification of the station's
eligibility under this clause and the
applicable subclause of clause (i), in
accordance with requirements the
Copyright Royalty Judges shall
prescribe by regulation.
(iii) For purposes of clauses (i) and (ii)--
(I) revenue shall be calculated in
accordance with generally accepted
accounting principles;
(II) revenue generated by a
terrestrial broadcast station shall
include all revenue from the operation
of the station, from any source; and
(III) in the case of affiliated
broadcast stations, revenue shall be
allocated reasonably to individual
stations associated with the revenue.
(iv) The royalty rates specified in clause
(i) shall not be admissible as evidence or
otherwise taken into account in determining
royalty rates in a proceeding under chapter 8,
or in any other administrative, judicial, or
other Federal Government proceeding involving
the setting or adjustment of the royalties
payable for the public performance or
reproduction in ephemeral phonorecords or
copies of sound recordings, the determination
of terms or conditions related thereto, or the
establishment of notice or recordkeeping
requirements.
(2) License agreements voluntarily negotiated at any
time between 1 or more copyright owners of sound
recordings and 1 or more entities performing sound
recordings shall be given effect in lieu of any
decision by the Librarian of Congress or determination
by the Copyright Royalty Judges.
(3)(A) The Copyright Royalty Judges shall also
establish requirements by which copyright owners may
receive reasonable notice of the use of their sound
recordings under this section, and under which records
of such use shall be kept and made available by
entities performing sound recordings. The notice and
recordkeeping rules in effect on the day before the
effective date of the Copyright Royalty and
Distribution Reform Act of 2004 shall remain in effect
unless and until new regulations are promulgated by the
Copyright Royalty Judges. If new regulations are
promulgated under this subparagraph, the Copyright
Royalty Judges shall take into account the substance
and effect of the rules in effect on the day before the
effective date of the Copyright Royalty and
Distribution Reform Act of 2004 and shall, to the
extent practicable, avoid significant disruption of the
functions of any designated agent authorized to collect
and distribute royalty fees.
(B) Any person who wishes to perform a sound
recording publicly by means of a transmission eligible
for statutory licensing under this subsection may do so
without infringing the exclusive right of the copyright
owner of the sound recording--
(i) by complying with such notice
requirements as the Copyright Royalty Judges
shall prescribe by regulation and by paying
royalty fees in accordance with this
subsection; or
(ii) if such royalty fees have not been set,
by agreeing to pay such royalty fees as shall
be determined in accordance with this
subsection.
(C) Any royalty payments in arrears shall be made on
or before the twentieth day of the month next
succeeding the month in which the royalty fees are set.
(4)(A) Notwithstanding section 112(e) and the other
provisions of this subsection, the receiving agent may
enter into agreements for the reproduction and
performance of sound recordings under section 112(e)
and this section by any 1 or more commercial webcasters
or noncommercial webcasters for a period of not more
than 11 years beginning on January 1, 2005, that, once
published in the Federal Register pursuant to
subparagraph (B), shall be binding on all copyright
owners of sound recordings and other persons entitled
to payment under this section, in lieu of any
determination by the Copyright Royalty Judges. Any such
agreement for commercial webcasters may include
provisions for payment of royalties on the basis of a
percentage of revenue or expenses, or both, and include
a minimum fee. Any such agreement may include other
terms and conditions, including requirements by which
copyright owners may receive notice of the use of their
sound recordings and under which records of such use
shall be kept and made available by commercial
webcasters or noncommercial webcasters. The receiving
agent shall be under no obligation to negotiate any
such agreement. The receiving agent shall have no
obligation to any copyright owner of sound recordings
or any other person entitled to payment under this
section in negotiating any such agreement, and no
liability to any copyright owner of sound recordings or
any other person entitled to payment under this section
for having entered into such agreement.
(B) The Copyright Office shall cause to be published
in the Federal Register any agreement entered into
pursuant to subparagraph (A). Such publication shall
include a statement containing the substance of
subparagraph (C). Such agreements shall not be included
in the Code of Federal Regulations. Thereafter, the
terms of such agreement shall be available, as an
option, to any commercial webcaster or noncommercial
webcaster meeting the eligibility conditions of such
agreement.
(C) Neither subparagraph (A) nor any provisions of
any agreement entered into pursuant to subparagraph
(A), including any rate structure, fees, terms,
conditions, or notice and recordkeeping requirements
set forth therein, shall be admissible as evidence or
otherwise taken into account in any administrative,
judicial, or other government proceeding involving the
setting or adjustment of the royalties payable for the
public performance or reproduction in ephemeral
phonorecords or copies of sound recordings, the
determination of terms or conditions related thereto,
or the establishment of notice or recordkeeping
requirements by the Copyright Royalty Judges under
paragraph (3) or section 112(e)(4). It is the intent of
Congress that any royalty rates, rate structure,
definitions, terms, conditions, or notice and
recordkeeping requirements, included in such agreements
shall be considered as a compromise motivated by the
unique business, economic and political circumstances
of webcasters, copyright owners, and performers rather
than as matters that would have been negotiated in the
marketplace between a willing buyer and a willing
seller, or otherwise meet the objectives set forth in
section 801(b). This subparagraph shall not apply to
the extent that the receiving agent and a webcaster
that is party to an agreement entered into pursuant to
subparagraph (A) expressly authorize the submission of
the agreement in a proceeding under this subsection.
(D) Nothing in the Webcaster Settlement Act of 2008,
the Webcaster Settlement Act of 2009, or any agreement
entered into pursuant to subparagraph (A) shall be
taken into account by the United States Court of
Appeals for the District of Columbia Circuit in its
review of the determination by the Copyright Royalty
Judges of May 1, 2007, of rates and terms for the
digital performance of sound recordings and ephemeral
recordings, pursuant to sections 112 and 114.
(E) As used in this paragraph--
(i) the term ``noncommercial webcaster''
means a webcaster that--
(I) is exempt from taxation under
section 501 of the Internal Revenue
Code of 1986 (26 U.S.C. 501);
(II) has applied in good faith to the
Internal Revenue Service for exemption
from taxation under section 501 of the
Internal Revenue Code and has a
commercially reasonable expectation
that such exemption shall be granted;
or
(III) is operated by a State or
possession or any governmental entity
or subordinate thereof, or by the
United States or District of Columbia,
for exclusively public purposes;
(ii) the term ``receiving agent'' shall have
the meaning given that term in section 261.2 of
title 37, Code of Federal Regulations, as
published in the Federal Register on July 8,
2002; and
(iii) the term ``webcaster'' means a person
or entity that has obtained a compulsory
license under section 112 or 114 and the
implementing regulations therefor.
(F) The authority to make settlements pursuant to
subparagraph (A) shall expire at 11:59 p.m. Eastern
time on the 30th day after the date of the enactment of
the Webcaster Settlement Act of 2009.
(g) Proceeds From Licensing of Transmissions.--
(1) Except in the case of a transmission licensed
under a statutory license in accordance with subsection
(f) of this section or in the case of a transmission to
which paragraph (5) applies--
(A) a featured recording artist who performs
on a sound recording that has been licensed for
a transmission shall be entitled to receive
payments from the copyright owner of the sound
recording in accordance with the terms of the
artist's contract; and
(B) a nonfeatured recording artist who
performs on a sound recording that has been
licensed for a transmission shall be entitled
to receive payments from the copyright owner of
the sound recording in accordance with the
terms of the nonfeatured recording artist's
applicable contract or other applicable
agreement.
(2) Except as provided for in paragraph (6), a
nonprofit collective designated by the Copyright
Royalty Judges to distribute receipts from the
licensing of transmissions in accordance with
subsection (f) shall distribute such receipts as
follows:
(A) 50 percent of the receipts shall be paid
to the copyright owner of the exclusive right
under section 106(6) of this title to publicly
perform a sound recording by means of [a
digital] an audio transmission.
(B) 21/2 percent of the receipts shall be
deposited in an escrow account managed by an
independent administrator jointly appointed by
copyright owners of sound recordings and the
American Federation of Musicians (or any
successor entity) to be distributed to
nonfeatured musicians (whether or not members
of the American Federation of Musicians) who
have performed on sound recordings.
(C) 21/2 percent of the receipts shall be
deposited in an escrow account managed by an
independent administrator jointly appointed by
copyright owners of sound recordings and the
American Federation of Television and Radio
Artists (or any successor entity) to be
distributed to nonfeatured vocalists (whether
or not members of the American Federation of
Television and Radio Artists) who have
performed on sound recordings.
(D) 45 percent of the receipts shall be paid,
on a per sound recording basis, to the
recording artist or artists featured on such
sound recording (or the persons conveying
rights in the artists' performance in the sound
recordings).
(3) A nonprofit collective designated by the
Copyright Royalty Judges to distribute receipts from
the licensing of transmissions in accordance with
subsection (f) may deduct from any of its receipts,
prior to the distribution of such receipts to any
person or entity entitled thereto other than copyright
owners and performers who have elected to receive
royalties from another designated nonprofit collective
and have notified such nonprofit collective in writing
of such election, the reasonable costs of such
collective incurred after November 1, 1995, in--
(A) the administration of the collection,
distribution, and calculation of the royalties;
(B) the settlement of disputes relating to
the collection and calculation of the
royalties; and
(C) the licensing and enforcement of rights
with respect to the making of ephemeral
recordings and performances subject to
licensing under section 112 and this section,
including those incurred in participating in
negotiations or arbitration proceedings under
section 112 and this section, except that all
costs incurred relating to the section 112
ephemeral recordings right may only be deducted
from the royalties received pursuant to section
112.
(4) Notwithstanding paragraph (3), any nonprofit
collective designated to distribute receipts from the
licensing of transmissions in accordance with
subsection (f) may deduct from any of its receipts,
prior to the distribution of such receipts, the
reasonable costs identified in paragraph (3) of such
collective incurred after November 1, 1995, with
respect to such copyright owners and performers who
have entered with such collective a contractual
relationship that specifies that such costs may be
deducted from such royalty receipts.
(5) Notwithstanding paragraph (1), to the extent that
a license granted by the copyright owner of a sound
recording to a transmitting entity eligible for a
statutory license under subsection (d)(2) extends to
such entity's transmissions otherwise licensable under
a statutory license in accordance with subsection (f),
such entity shall pay to the collective designated to
distribute statutory licensing receipts from the
licensing of transmissions in accordance with
subsection (f), 50 percent of the total royalties that
such entity is required, pursuant to the applicable
license agreement, to pay for such transmissions
otherwise licensable under a statutory license in
accordance with subsection (f). That collective shall
distribute such payments in proportion to the
distributions provided in subparagraphs (B) through (D)
of paragraph (2), and such payments shall be the only
payments to which featured and nonfeatured artists are
entitled by virtue of such transmissions under the
direct license with such entity.
[(5)] (6) Letter of direction.--
(A) In general.--A nonprofit collective
designated by the Copyright Royalty Judges to
distribute receipts from the licensing of
transmissions in accordance with subsection (f)
shall adopt and reasonably implement a policy
that provides, in circumstances determined by
the collective to be appropriate, for
acceptance of instructions from a payee
identified under subparagraph (A) or (D) of
paragraph (2) to distribute, to a producer,
mixer, or sound engineer who was part of the
creative process that created a sound
recording, a portion of the payments to which
the payee would otherwise be entitled from the
licensing of transmissions of the sound
recording. In this section, such instructions
shall be referred to as a ``letter of
direction''.
(B) Acceptance of letter.--To the extent that
a collective described in subparagraph (A)
accepts a letter of direction under that
subparagraph, the person entitled to payment
pursuant to the letter of direction shall,
during the period in which the letter of
direction is in effect and carried out by the
collective, be treated for all purposes as the
owner of the right to receive such payment, and
the payee providing the letter of direction to
the collective shall be treated as having no
interest in such payment.
(C) Authority of collective.--This paragraph
shall not be construed in such a manner so that
the collective is not authorized to accept or
act upon payment instructions in circumstances
other than those to which this paragraph
applies.
[(6)] (7) Sound recordings fixed before november 1,
1995.--
(A) Payment absent letter of direction.--A
nonprofit collective designated by the
Copyright Royalty Judges to distribute receipts
from the licensing of transmissions in
accordance with subsection (f) (in this
paragraph referred to as the ``collective'')
shall adopt and reasonably implement a policy
that provides, in circumstances determined by
the collective to be appropriate, for the
deduction of 2 percent of all the receipts that
are collected from the licensing of
transmissions of a sound recording fixed before
November 1, 1995, but which is withdrawn from
the amount otherwise payable under paragraph
(2)(D) to the recording artist or artists
featured on the sound recording (or the persons
conveying rights in the artists' performance in
the sound recording), and the distribution of
such amount to 1 or more persons described in
subparagraph (B) of this paragraph, after
deduction of costs described in paragraph (3)
or (4), as applicable, if each of the following
requirements is met:
(i) Certification of attempt to
obtain a letter of direction.--The
person described in subparagraph (B)
who is to receive the distribution has
certified to the collective, under
penalty of perjury, that--
(I) for a period of not less
than 120 days, that person made
reasonable efforts to contact
the artist payee for such sound
recording to request and obtain
a letter of direction
instructing the collective to
pay to that person a portion of
the royalties payable to the
featured recording artist or
artists; and
(II) during the period
beginning on the date on which
that person began the
reasonable efforts described in
subclause (I) and ending on the
date of that person's
certification to the
collective, the artist payee
did not affirm or deny in
writing the request for a
letter of direction.
(ii) Collective attempt to contact
artist.--After receipt of the
certification described in clause (i)
and for a period of not less than 120
days before the first distribution by
the collective to the person described
in subparagraph (B), the collective
attempts, in a reasonable manner as
determined by the collective, to notify
the artist payee of the certification
made by the person described in
subparagraph (B).
(iii) No objection received.--The
artist payee does not, as of the date
that was 10 business days before the
date on which the first distribution is
made, submit to the collective in
writing an objection to the
distribution.
(B) Eligibility for payment.--A person shall
be eligible for payment under subparagraph (A)
if the person--
(i) is a producer, mixer, or sound
engineer of the sound recording;
(ii) has entered into a written
contract with a record company involved
in the creation or lawful exploitation
of the sound recording, or with the
recording artist or artists featured on
the sound recording (or the persons
conveying rights in the artists'
performance in the sound recording),
under which the person seeking payment
is entitled to participate in royalty
payments that are based on the
exploitation of the sound recording and
are payable from royalties otherwise
payable to the recording artist or
artists featured on the sound recording
(or the persons conveying rights in the
artists' performance in the sound
recording);
(iii) made a creative contribution to
the creation of the sound recording;
and
(iv) submits to the collective--
(I) a written certification
stating, under penalty of
perjury, that the person meets
the requirements in clauses (i)
through (iii); and
(II) a true copy of the
contract described in clause
(ii).
(C) Multiple certifications.--Subject to
subparagraph (D), in a case in which more than
1 person described in subparagraph (B) has met
the requirements for a distribution under
subparagraph (A) with respect to a sound
recording as of the date that is 10 business
days before the date on which the distribution
is made, the collective shall divide the 2
percent distribution equally among all such
persons.
(D) Objection to payment.--Not later than 10
business days after the date on which the
collective receives from the artist payee a
written objection to a distribution made
pursuant to subparagraph (A), the collective
shall cease making any further payment relating
to such distribution. In any case in which the
collective has made 1 or more distributions
pursuant to subparagraph (A) to a person
described in subparagraph (B) before the date
that is 10 business days after the date on
which the collective receives from the artist
payee an objection to such distribution, the
objection shall not affect that person's
entitlement to any distribution made before the
collective ceases such distribution under this
subparagraph.
(E) Ownership of the right to receive
payments.--To the extent that the collective
determines that a distribution will be made
under subparagraph (A) to a person described in
subparagraph (B), such person shall, during the
period covered by such distribution, be treated
for all purposes as the owner of the right to
receive such payments, and the artist payee to
whom such payments would otherwise be payable
shall be treated as having no interest in such
payments.
(F) Artist payee defined.--In this paragraph,
the term ``artist payee'' means a person, other
than a person described in subparagraph (B),
who owns the right to receive all or part of
the receipts payable under paragraph (2)(D)
with respect to a sound recording. In a case in
which there are multiple artist payees with
respect to a sound recording, an objection by 1
such payee shall apply only to that payee's
share of the receipts payable under paragraph
(2)(D), and shall not preclude payment under
subparagraph (A) from the share of an artist
payee that does not so object.
[(7)] (8) Preemption of state property laws.--The
holding and distribution of receipts under section 112
and this section by a nonprofit collective designated
by the Copyright Royalty Judges in accordance with this
subsection and regulations adopted by the Copyright
Royalty Judges, or by an independent administrator
pursuant to subparagraphs (B) and (C) of section
114(g)(2), shall supersede and preempt any State law
(including common law) concerning escheatment or
abandoned property, or any analogous provision, that
might otherwise apply.
(h) Licensing to Affiliates.--
(1) If the copyright owner of a sound recording
licenses an affiliated entity the right to publicly
perform a sound recording by means of a digital audio
transmission under section 106(6), the copyright owner
shall make the licensed sound recording available under
section 106(6) on no less favorable terms and
conditions to all bona fide entities that offer similar
services, except that, if there are material
differences in the scope of the requested license with
respect to the type of service, the particular sound
recordings licensed, the frequency of use, the number
of subscribers served, or the duration, then the
copyright owner may establish different terms and
conditions for such other services.
(2) The limitation set forth in paragraph (1) of this
subsection shall not apply in the case where the
copyright owner of a sound recording licenses--
(A) an interactive service; or
(B) an entity to perform publicly up to 45
seconds of the sound recording and the sole
purpose of the performance is to promote the
distribution or performance of that sound
recording.
(j) Definitions.--As used in this section, the following
terms have the following meanings:
(1) An ``affiliated entity'' is an entity engaging in
digital audio transmissions covered by section 106(6),
other than an interactive service, in which the
licensor has any direct or indirect partnership or any
ownership interest amounting to 5 percent or more of
the outstanding voting or non-voting stock.
(2) An ``archived program'' is a predetermined
program that is available repeatedly on the demand of
the transmission recipient and that is performed in the
same order from the beginning, except that an archived
program shall not include a recorded event or broadcast
transmission that makes no more than an incidental use
of sound recordings, as long as such recorded event or
broadcast transmission does not contain an entire sound
recording or feature a particular sound recording.
(3) A ``broadcast'' transmission is a transmission
made by a terrestrial broadcast station licensed as
such by the Federal Communications Commission.
(4) A ``continuous program'' is a predetermined
program that is continuously performed in the same
order and that is accessed at a point in the program
that is beyond the control of the transmission
recipient.
(5) A ``digital audio transmission'' is a digital
transmission as defined in section 101, that embodies
the transmission of a sound recording. This term does
not include the transmission of any audiovisual work.
(6) An ``eligible nonsubscription transmission'' is a
noninteractive nonsubscription [digital] audio
transmission not exempt under subsection (d)(1) that is
made as part of a service that provides audio
programming consisting, in whole or in part, of
performances of sound recordings, including
[retransmissions of broadcast transmissions] broadcast
transmissions and retransmissions of broadcast
transmissions, if the primary purpose of the service is
to provide to the public such audio or other
entertainment programming, and the primary purpose of
the service is not to sell, advertise, or promote
particular products or services other than sound
recordings, live concerts, or other music-related
events.
(7) An ``interactive service'' is one that enables a
member of the public to receive a transmission of a
program specially created for the recipient, or on
request, a transmission of a particular sound
recording, whether or not as part of a program, which
is selected by or on behalf of the recipient. The
ability of individuals to request that particular sound
recordings be performed for reception by the public at
large, or in the case of a subscription service, by all
subscribers of the service, does not make a service
interactive, if the programming on each channel of the
service does not substantially consist of sound
recordings that are performed within 1 hour of the
request or at a time designated by either the
transmitting entity or the individual making such
request. If an entity offers both interactive and
noninteractive services (either concurrently or at
different times), the noninteractive component shall
not be treated as part of an interactive service.
(8) A ``new subscription service'' is a service that
performs sound recordings by means of noninteractive
[subscription digital] subscription audio transmissions
and that is not a preexisting subscription service or a
preexisting satellite digital audio radio service.
(9) A ``nonsubscription'' transmission is any
transmission that is not a subscription transmission.
(10) A ``preexisting satellite digital audio radio
service'' is a subscription satellite digital audio
radio service provided pursuant to a satellite digital
audio radio service license issued by the Federal
Communications Commission on or before July 31, 1998,
and any renewal of such license to the extent of the
scope of the original license, and may include a
limited number of sample channels representative of the
subscription service that are made available on a
nonsubscription basis in order to promote the
subscription service.
(11) A ``preexisting subscription service'' is a
service that performs sound recordings by means of
noninteractive audio-only subscription digital audio
transmissions, which was in existence and was making
such transmissions to the public for a fee on or before
July 31, 1998, and may include a limited number of
sample channels representative of the subscription
service that are made available on a nonsubscription
basis in order to promote the subscription service.
(12) A ``retransmission'' is a further transmission
of an initial transmission, and includes any further
retransmission of the same transmission. Except as
provided in this section, a transmission qualifies as a
``retransmission'' only if it is simultaneous with the
initial transmission. Nothing in this definition shall
be construed to exempt a transmission that fails to
satisfy a separate element required to qualify for an
exemption under section 114(d)(1).
(13) The ``sound recording performance complement''
is the transmission during any 3-hour period, on a
particular channel used by a transmitting entity, of no
more than--
(A) 3 different selections of sound
recordings from any one phonorecord lawfully
distributed for public performance or sale in
the United States, if no more than 2 such
selections are transmitted consecutively; or
(B) 4 different selections of sound
recordings--
(i) by the same featured recording
artist; or
(ii) from any set or compilation of
phonorecords lawfully distributed
together as a unit for public
performance or sale in the United
States,
if no more than three such selections are
transmitted consecutively:
Provided, That the transmission of selections in
excess of the numerical limits provided for in clauses
(A) and (B) from multiple phonorecords shall
nonetheless qualify as a sound recording performance
complement if the programming of the multiple
phonorecords was not willfully intended to avoid the
numerical limitations prescribed in such clauses.
(14) A ``subscription'' transmission is a
transmission that is controlled and limited to
particular recipients, and for which consideration is
required to be paid or otherwise given by or on behalf
of the recipient to receive the transmission or a
package of transmissions including the transmission.
(15) A ``transmission'' is either an initial
transmission or a retransmission.
* * * * * * *
Sec. 118. Scope of exclusive rights: Use of certain works in connection
with noncommercial broadcasting
(a) The exclusive rights provided by section 106 shall, with
respect to the works specified by subsection (b) and the
activities specified by subsection (d), be subject to the
conditions and limitations prescribed by this section.
(b) Notwithstanding any provision of the antitrust laws, any
owners of copyright in published nondramatic musical works and
published pictorial, graphic, and sculptural works and any
public broadcasting entities, respectively, may negotiate and
agree upon the terms and rates of royalty payments and the
proportionate division of fees paid among various copyright
owners, and may designate common agents to negotiate, agree to,
pay, or receive payments.
(1) Any owner of copyright in a work specified in
this subsection or any public broadcasting entity may
submit to the Copyright Royalty Judges proposed
licenses covering such activities with respect to such
works.
(2) License agreements voluntarily negotiated at any
time between one or more copyright owners and one or
more public broadcasting entities shall be given effect
in lieu of any determination by the Librarian of
Congress or the Copyright Royalty Judges, if copies of
such agreements are filed with the Copyright Royalty
Judges within 30 days of execution in accordance with
regulations that the Copyright Royalty Judges shall
issue.
(3) Voluntary negotiation proceedings initiated
pursuant to a petition filed under section 804(a) for
the purpose of determining a schedule of terms and
rates of royalty payments by public broadcasting
entities to owners of copyright in works specified by
this subsection and the proportionate division of fees
paid among various copyright owners shall cover the 5-
year period beginning on January 1 of the second year
following the year in which the petition is filed. The
parties to each negotiation proceeding shall bear their
own costs.
(4) In the absence of license agreements negotiated
under paragraph (2) or (3), the Copyright Royalty
Judges shall, pursuant to chapter 8, conduct a
proceeding to determine and publish in the Federal
Register a schedule of rates and terms which, subject
to paragraph (2), shall be binding on all owners of
copyright in works specified by this subsection and
public broadcasting entities, regardless of whether
such copyright owners have submitted proposals to the
Copyright Royalty Judges. In establishing such rates
and terms the Copyright Royalty Judges may consider the
rates for comparable circumstances under voluntary
license agreements negotiated as provided in paragraph
(2) or (3). The Copyright Royalty Judges shall also
establish requirements by which copyright owners may
receive reasonable notice of the use of their works
under this section, and under which records of such use
shall be kept by public broadcasting entities.
(c) Subject to the terms of any voluntary license agreements
that have been negotiated as provided by subsection (b)(2) or
(3), a public broadcasting entity may, upon compliance with the
provisions of this section, including the rates and terms
established by the Copyright Royalty Judges under subsection
(b)(4), engage in the following activities with respect to
published nondramatic musical works and published pictorial,
graphic, and sculptural works:
(1) performance or display of a work by or in the
course of a transmission made by a noncommercial
educational broadcast station referred to in subsection
(f); and
(2) production of a transmission program,
reproduction of copies or phonorecords of such a
transmission program, and distribution of such copies
or phonorecords, where such production, reproduction,
or distribution is made by a nonprofit institution or
organization solely for the purpose of transmissions
specified in paragraph (1); and
(3) the making of reproductions by a governmental
body or a nonprofit institution of a transmission
program simultaneously with its transmission as
specified in paragraph (1), and the performance or
display of the contents of such program under the
conditions specified by paragraph (1) of section 110,
but only if the reproductions are used for performances
or displays for a period of no more than seven days
from the date of the transmission specified in
paragraph (1), and are destroyed before or at the end
of such period. No person supplying, in accordance with
paragraph (2), a reproduction of a transmission program
to governmental bodies or nonprofit institutions under
this paragraph shall have any liability as a result of
failure of such body or institution to destroy such
reproduction: Provided, That it shall have notified
such body or institution of the requirement for such
destruction pursuant to this paragraph: And provided
further, That if such body or institution itself fails
to destroy such reproduction it shall be deemed to have
infringed.
(d) Except as expressly provided in this subsection, this
section shall have no applicability to works other than those
specified in subsection (b). Owners of copyright in nondramatic
literary works and public broadcasting entities may, during the
course of voluntary negotiations, agree among themselves,
respectively, as to the terms and rates of royalty payments
without liability under the antitrust laws. Any such terms and
rates of royalty payments shall be effective upon filing with
the Copyright Royalty Judges, in accordance with regulations
that the Copyright Royalty Judges shall prescribe as provided
in section 803(b)(6).
(e) Nothing in this section shall be construed to permit,
beyond the limits of fair use as provided by section 107, the
unauthorized dramatization of a nondramatic musical work, the
production of a transmission program drawn to any substantial
extent from a published compilation of pictorial, graphic, or
sculptural works, or the unauthorized use of any portion of an
audiovisual work.
(f) As used in this section, the term ``public broadcasting
entity'' means a noncommercial educational broadcast station as
defined in [section 397 of title 47] section 397 of the
Communications Act of 1934 (47 U.S.C. 397) and any nonprofit
institution or organization engaged in the activities described
in paragraph (2) of subsection (c).
* * * * * * *
CHAPTER 8--PROCEEDINGS BY COPYRIGHT ROYALTY JUDGES
* * * * * * *
Sec. 804. Institution of proceedings
(a) Filing of Petition.--With respect to proceedings referred
to in paragraphs (1) and (2) of section 801(b) concerning the
determination or adjustment of royalty rates as provided in
sections 111, 112, 114, 115, 116, 118, 119, and 1004, during
the calendar years specified in the schedule set forth in
subsection (b), any owner or user of a copyrighted work whose
royalty rates are specified by this title, or are established
under this chapter before or after the enactment of the
Copyright Royalty and Distribution Reform Act of 2004, may file
a petition with the Copyright Royalty Judges declaring that the
petitioner requests a determination or adjustment of the rate.
The Copyright Royalty Judges shall make a determination as to
whether the petitioner has such a significant interest in the
royalty rate in which a determination or adjustment is
requested. If the Copyright Royalty Judges determine that the
petitioner has such a significant interest, the Copyright
Royalty Judges shall cause notice of this determination, with
the reasons for such determination, to be published in the
Federal Register, together with the notice of commencement of
proceedings under this chapter. With respect to proceedings
under paragraph (1) of section 801(b) concerning the
determination or adjustment of royalty rates as provided in
sections 112 and 114, during the calendar years specified in
the schedule set forth in subsection (b), the Copyright Royalty
Judges shall cause notice of commencement of proceedings under
this chapter to be published in the Federal Register as
provided in section 803(b)(1)(A).
(b) Timing of Proceedings.--
(1) Section 111 proceedings.--(A) A petition
described in subsection (a) to initiate proceedings
under section 801(b)(2) concerning the adjustment of
royalty rates under section 111 to which subparagraph
(A) or (D) of section 801(b)(2) applies may be filed
during the year 2015 and in each subsequent fifth
calendar year.
(B) In order to initiate proceedings under section
801(b)(2) concerning the adjustment of royalty rates
under section 111 to which subparagraph (B) or (C) of
section 801(b)(2) applies, within 12 months after an
event described in either of those subsections, any
owner or user of a copyrighted work whose royalty rates
are specified by section 111, or by a rate established
under this chapter before or after the enactment of the
Copyright Royalty and Distribution Reform Act of 2004,
may file a petition with the Copyright Royalty Judges
declaring that the petitioner requests an adjustment of
the rate. The Copyright Royalty Judges shall then
proceed as set forth in subsection (a) of this section.
Any change in royalty rates made under this chapter
pursuant to this subparagraph may be reconsidered in
the year 2015, and each fifth calendar year thereafter,
in accordance with the provisions in section
801(b)(2)(B) or (C), as the case may be. A petition for
adjustment of rates established by section 111(d)(1)(B)
as a result of a change in the rules and regulations of
the Federal Communications Commission shall set forth
the change on which the petition is based.
(C) Any adjustment of royalty rates under section 111
shall take effect as of the first accounting period
commencing after the publication of the determination
of the Copyright Royalty Judges in the Federal
Register, or on such other date as is specified in that
determination.
(2) Certain section 112 proceedings.--Proceedings
under this chapter shall be commenced in the year 2007
to determine reasonable terms and rates of royalty
payments for the activities described in section
112(e)(1) relating to the limitation on exclusive
rights specified by section 114(d)(1)(C)(iv), to become
effective on January 1, 2009. Such proceedings shall be
repeated in each subsequent fifth calendar year.
(3) Section 114 and corresponding 112 proceedings.--
(A) For eligible nonsubscription services and
new subscription services.--Proceedings under
this chapter shall be commenced as soon as
practicable after the date of enactment of the
Copyright Royalty and Distribution Reform Act
of 2004 to determine reasonable terms and rates
of royalty payments under sections 114 and 112
for the activities of eligible nonsubscription
transmission services and new subscription
services, to be effective for the period
beginning on January 1, 2006, and ending on
December 31, 2010. Such proceedings shall next
be commenced in January 2009 to determine
reasonable terms and rates of royalty payments,
to become effective on January 1, 2011.
Thereafter, such proceedings shall be repeated
in each subsequent fifth calendar year.
(B) For preexisting subscription and
satellite digital audio radio services.--
Proceedings under this chapter shall be
commenced in January 2006 to determine
reasonable terms and rates of royalty payments
under sections 114 and 112 for the activities
of preexisting subscription services, to be
effective during the period beginning on
January 1, 2008, and ending on December 31,
2012, and preexisting satellite digital audio
radio services, to be effective during the
period beginning on January 1, 2007, and ending
on December 31, 2012. Such proceedings shall
next be commenced in 2011 to determine
reasonable terms and rates of royalty payments,
to become effective on January 1, 2013.
Thereafter, such proceedings shall be repeated
in each subsequent fifth calendar year, except
that--(i) with respect to preexisting
subscription services, the terms and rates
finally determined for the rate period ending
on December 31, 2022, shall remain in effect
through December 31, 2027, and there shall be
no proceeding to determine terms and rates for
preexisting subscription services for the
period beginning on January 1, 2023, and ending
on December 31, 2027; and'' `` (ii) with
respect to pre-existing satellite digital audio
radio services, the terms and rates set forth
by the Copyright Royalty Judges on December 14,
2017, in their initial determination for the
rate period ending on December 31, 2022, shall
be in effect through December 31, 2027, without
any change based on a rehearing under section
803(c)(2) and without the possibility of appeal
under section 803(d), and there shall be no
proceeding to determine terms and rates for
preexisting satellite digital audio radio
services for the period beginning on January 1,
2023, and ending on December 31, 2027.
(C)(i) Notwithstanding any other provision of
this chapter, this subparagraph shall govern
proceedings commenced pursuant to section
114(f)(1)(C) concerning new types of services.
(ii) Not later than 30 days after a petition
to determine rates and terms for a new type of
service is filed by any copyright owner of
sound recordings, or such new type of service,
indicating that such new type of service is or
is about to become operational, the Copyright
Royalty Judges shall issue a notice for a
proceeding to determine rates and terms for
such service.
(iii) The proceeding shall follow the
schedule set forth in subsections (b), (c), and
(d) of section 803, except that--
(I) the determination shall be issued
by not later than 24 months after the
publication of the notice under clause
(ii); and
(II) the decision shall take effect
as provided in subsections (c)(2) and
(d)(2) of section 803 and section
114(f)(3)(B)(ii) and (C).
(iv) The rates and terms shall remain in
effect for the period set forth in section
114(f)(1)(C).
(D) A proceeding under this chapter shall be
commenced as soon as practicable after the date
of the enactment of this subparagraph to
determine royalty rates and terms for
nonsubscription broadcast transmissions, to be
effective for the period beginning on such date
of enactment, and ending on December 31, 2028.
Any payment due under section 114(f)(1)(D)
shall not be due until the due date of the
first royalty payments for nonsubscription
broadcast transmissions that are determined,
after the date of the enactment of this
subparagraph, by the Copyright Royalty Judges.
Thereafter, such proceeding shall be repeated
in each subsequent fifth calendar year.
(4) Section 115 proceedings.--A petition described in
subsection (a) to initiate proceedings under section
801(b)(1) concerning the adjustment or determination of
royalty rates as provided in section 115 may be filed
in the year 2006 and in each subsequent fifth calendar
year, or at such other times as the parties have agreed
under section 115(c)(3)(B) and (C).
(5) Section 116 proceedings.--(A) A petition
described in subsection (a) to initiate proceedings
under section 801(b) concerning the determination of
royalty rates and terms as provided in section 116 may
be filed at any time within 1 year after negotiated
licenses authorized by section 116 are terminated or
expire and are not replaced by subsequent agreements.
(B) If a negotiated license authorized by section 116
is terminated or expires and is not replaced by another
such license agreement which provides permission to use
a quantity of musical works not substantially smaller
than the quantity of such works performed on coin-
operated phonorecord players during the 1-year period
ending March 1, 1989, the Copyright Royalty Judges
shall, upon petition filed under paragraph (1) within 1
year after such termination or expiration, commence a
proceeding to promptly establish an interim royalty
rate or rates for the public performance by means of a
coin-operated phonorecord player of nondramatic musical
works embodied in phonorecords which had been subject
to the terminated or expired negotiated license
agreement. Such rate or rates shall be the same as the
last such rate or rates and shall remain in force until
the conclusion of proceedings by the Copyright Royalty
Judges, in accordance with section 803, to adjust the
royalty rates applicable to such works, or until
superseded by a new negotiated license agreement, as
provided in section 116(b).
(6) Section 118 proceedings.--A petition described in
subsection (a) to initiate proceedings under section
801(b)(1) concerning the determination of reasonable
terms and rates of royalty payments as provided in
section 118 may be filed in the year 2006 and in each
subsequent fifth calendar year.
(7) Section 1004 proceedings.--A petition described
in subsection (a) to initiate proceedings under section
801(b)(1) concerning the adjustment of reasonable
royalty rates under section 1004 may be filed as
provided in section 1004(a)(3).
(8) Proceedings concerning distribution of royalty
fees.--With respect to proceedings under section
801(b)(3) concerning the distribution of royalty fees
in certain circumstances under section 111, 119, or
1007, the Copyright Royalty Judges shall, upon a
determination that a controversy exists concerning such
distribution, cause to be published in the Federal
Register notice of commencement of proceedings under
this chapter.
* * * * * * *
CHAPTER 14--UNAUTHORIZED USE OF PRE-1972 SOUND RECORDINGS
Sec. 1401. Unauthorized use of pre-1972 sound recordings
(a) In General.--
(1) Unauthorized acts.--Anyone who, on or before the
last day of the applicable transition period under
paragraph (2), and without the consent of the rights
owner, engages in covered activity with respect to a
sound recording fixed before February 15, 1972, shall
be subject to the remedies provided in sections 502
through 505 and 1203 to the same extent as an infringer
of copyright or a person that engages in unauthorized
activity under chapter 12.
(2) Term of prohibition.--
(A) In general.--The prohibition under
paragraph (1)--
(i) subject to clause (ii), shall
apply to a sound recording described in
that paragraph--
(I) through December 31 of
the year that is 95 years after
the year of first publication;
and
(II) for a further transition
period as prescribed under
subparagraph (B) of this
paragraph; and
(ii) shall not apply to any sound
recording after February 15, 2067.
(B) Transition periods.--
(i) Pre-1923 recordings.--In the case
of a sound recording first published
before January 1, 1923, the transition
period described in subparagraph
(A)(i)(II) shall end on December 31 of
the year that is 3 years after the date
of enactment of this section.
(ii) 1923-1946 recordings.--In the
case of a sound recording first
published during the period beginning
on January 1, 1923, and ending on
December 31, 1946, the transition
period described in subparagraph
(A)(i)(II) shall end on the date that
is 5 years after the last day of the
period described in subparagraph
(A)(i)(I).
(iii) 1947-1956 recordings.--In the
case of a sound recording first
published during the period beginning
on January 1, 1947, and ending on
December 31, 1956, the transition
period described in subparagraph
(A)(i)(II) shall end on the date that
is 15 years after the last day of the
period described in subparagraph
(A)(i)(I).
(iv) Post-1956 recordings.--In the
case of a sound recording fixed before
February 15, 1972, that is not
described in clause (i), (ii), or
(iii), the transition period described
in subparagraph (A)(i)(II) shall end on
February 15, 2067.
(3) Rule of construction.--For the purposes of this
subsection, the term ``anyone'' includes any State, any
instrumentality of a State, and any officer or employee
of a State or instrumentality of a State acting in the
official capacity of the officer or employee, as
applicable.
(b) Certain Authorized Transmissions and Reproductions.--A
public performance by means of [a digital audio] an audio
transmission of a sound recording fixed before February 15,
1972, or a reproduction in an ephemeral phonorecord or copy of
a sound recording fixed before February 15, 1972, shall, for
purposes of subsection (a), be considered to be authorized and
made with the consent of the rights owner if--
(1) the transmission or reproduction would satisfy
the requirements for statutory licensing under section
112(e)(1) or section 114(d)(2), or would be exempt
under section 114(d)(1), as the case may be, if the
sound recording were fixed on or after February 15,
1972; and
(2) the transmitting entity pays the statutory
royalty for the transmission or reproduction pursuant
to the rates and terms adopted under sections 112(e)
and 114(f), and complies with other obligations, in the
same manner as required by regulations adopted by the
Copyright Royalty Judges under sections 112(e) and
114(f) for sound recordings that are fixed on or after
February 15, 1972, except in the case of a transmission
that would be exempt under section 114(d)(1).
(c) Certain Noncommercial Uses of Sound Recordings That Are
Not Being Commercially Exploited.--
(1) In general.--Noncommercial use of a sound
recording fixed before February 15, 1972, that is not
being commercially exploited by or under the authority
of the rights owner shall not violate subsection (a)
if--
(A) the person engaging in the noncommercial
use, in order to determine whether the sound
recording is being commercially exploited by or
under the authority of the rights owner, makes
a good faith, reasonable search for, but does
not find, the sound recording--
(i) in the records of schedules filed
in the Copyright Office as described in
subsection (f)(5)(A); and
(ii) on services offering a
comprehensive set of sound recordings
for sale or streaming;
(B) the person engaging in the noncommercial
use files a notice identifying the sound
recording and the nature of the use in the
Copyright Office in accordance with the
regulations issued under paragraph (3)(B); and
(C) during the 90-day period beginning on the
date on which the notice described in
subparagraph (B) is indexed into the public
records of the Copyright Office, the rights
owner of the sound recording does not, in its
discretion, opt out of the noncommercial use by
filing notice thereof in the Copyright Office
in accordance with the regulations issued under
paragraph (5).
(2) Rules of construction.--For purposes of this
subsection--
(A) merely recovering costs of production and
distribution of a sound recording resulting
from a use otherwise permitted under this
subsection does not itself necessarily
constitute a commercial use of the sound
recording;
(B) the fact that a person engaging in the
use of a sound recording also engages in
commercial activities does not itself
necessarily render the use commercial; and
(C) the fact that a person files notice of a
noncommercial use of a sound recording in
accordance with the regulations issued under
paragraph (3)(B) does not itself affect any
limitation on the exclusive rights of a
copyright owner described in section 107, 108,
109, 110, or 112(f) as applied to a claim under
subsection (a) of this section pursuant to
subsection (f)(1)(A) of this section.
(3) Notice of covered activity.--Not later than 180
days after the date of enactment of this section, the
Register of Copyrights shall issue regulations that--
(A) provide specific, reasonable steps that,
if taken by a filer, are sufficient to
constitute a good faith, reasonable search
under paragraph (1)(A) to determine whether a
recording is being commercially exploited,
including the services that satisfy the good
faith, reasonable search requirement under
paragraph (1)(A) for purposes of the safe
harbor described in paragraph (4)(A); and
(B) establish the form, content, and
procedures for the filing of notices under
paragraph (1)(B).
(4) Safe harbor.--
(A) In general.--A person engaging in a
noncommercial use of a sound recording
otherwise permitted under this subsection who
establishes that the person made a good faith,
reasonable search under paragraph (1)(A)
without finding commercial exploitation of the
sound recording by or under the authority of
the rights owner shall not be found to be in
violation of subsection (a).
(B) Steps sufficient but not necessary.--
Taking the specific, reasonable steps
identified by the Register of Copyrights in the
regulations issued under paragraph (3)(A) shall
be sufficient, but not necessary, for a filer
to satisfy the requirement to conduct a good
faith, reasonable search under paragraph (1)(A)
for purposes of subparagraph (A) of this
paragraph.
(5) Opting out of covered activity.--
(A) In general.--Not later than 180 days
after the date of enactment of this section,
the Register of Copyrights shall issue
regulations establishing the form, content, and
procedures for the rights owner of a sound
recording that is the subject of a notice under
paragraph (1)(B) to, in its discretion, file
notice opting out of the covered activity
described in the notice under paragraph (1)(B)
during the 90-day period beginning on the date
on which the notice under paragraph (1)(B) is
indexed into the public records of the
Copyright Office.
(B) Rule of construction.--The fact that a
rights holder opts out of a noncommercial use
of a sound recording by filing notice thereof
in the Copyright Office in accordance with the
regulations issued under subparagraph (A) does
not itself enlarge or diminish any limitation
on the exclusive rights of a copyright owner
described in section 107, 108, 109, 110, or
112(f) as applied to a claim under subsection
(a) of this section pursuant to subsection
(f)(1)(A) of this section.
(6) Civil penalties for certain acts.--
(A) Filing of notices of noncommercial use.--
Any person who willfully engages in a pattern
or practice of filing a notice of noncommercial
use of a sound recording as described in
paragraph (1)(B) fraudulently describing the
use proposed, or knowing that the use proposed
is not permitted under this subsection, shall
be assessed a civil penalty in an amount that
is not less than $250, and not more than $1000,
for each such notice, in addition to any other
remedies that may be available under this title
based on the actual use made.
(B) Filing of opt-out notices.--
(i) In general.--Any person who files
an opt-out notice as described in
paragraph (1)(C), knowing that the
person is not the rights owner or
authorized to act on behalf of the
rights owner of the sound recording to
which the notice pertains, shall be
assessed a civil penalty in an amount
not less than $250, and not more than
$1,000, for each such notice.
(ii) Pattern or practice.--Any person
who engages in a pattern or practice of
making filings as described in clause
(i) shall be assessed a civil penalty
in an amount not less than $10,000 for
each such filing.
(C) Definition.--For purposes of this
paragraph, the term ``knowing''--
(i) does not require specific intent
to defraud; and
(ii) with respect to information
about ownership of the sound recording
in question, means that the person--
(I) has actual knowledge of
the information;
(II) acts in deliberate
ignorance of the truth or
falsity of the information; or
(III) acts in grossly
negligent disregard of the
truth or falsity of the
information.
(d) Payment of Royalties for Transmissions of Performances by
Direct Licensing of Statutory Services.--
(1) In general.--A public performance by means of [a
digital audio] an audio transmission of a sound
recording fixed before February 15, 1972, shall, for
purposes of subsection (a), be considered to be
authorized and made with the consent of the rights
owner if the transmission is made pursuant to a license
agreement voluntarily negotiated at any time between
the rights owner and the entity performing the sound
recording.
(2) Payment of royalties to nonprofit collective
under certain license agreements.--
(A) Licenses entered into on or after date of
enactment.--To the extent that a license
agreement described in paragraph (1) entered
into on or after the date of enactment of this
section extends to a public performance by
means of [a digital audio] an audio
transmission of a sound recording fixed before
February 15, 1972, that meets the conditions of
subsection (b)--
(i) the licensee shall, with respect
to such transmission, pay to the
collective designated to distribute
receipts from the licensing of
transmissions in accordance with
section 114(f), 50 percent of the
performance royalties for that
transmission due under the license; and
(ii) the royalties paid under clause
(i) shall be fully credited as payments
due under the license.
(B) Certain agreements entered into before
enactment.--To the extent that a license
agreement described in paragraph (1), entered
into during the period beginning on January 1
of the year in which this section is enacted
and ending on the day before the date of
enactment of this section, or a settlement
agreement with a preexisting satellite digital
audio radio service (as defined in section
114(j)) entered into during the period
beginning on January 1, 2015, and ending on the
day before the date of enactment of this
section, extends to a public performance by
means of a digital audio transmission of a
sound recording fixed before February 15, 1972,
that meets the conditions of subsection (b)--
(i) the rights owner shall, with
respect to such transmission, pay to
the collective designated to distribute
receipts from the licensing of
transmissions in accordance with
section 114(f) an amount that is equal
to the difference between--
(I) 50 percent of the
difference between--
(aa) the rights
owner's total gross
performance royalty fee
receipts or settlement
monies received for all
such transmissions
covered under the
license or settlement
agreement, as
applicable; and
(bb) the rights
owner's total payments
for outside legal
expenses, including any
payments of third-party
claims, that are
directly attributable
to the license or
settlement agreement,
as applicable; and
(II) the amount of any
royalty receipts or settlement
monies under the agreement that
are distributed by the rights
owner to featured and
nonfeatured artists before the
date of enactment of this
section; and
(ii) the royalties paid under clause
(i) shall be fully credited as payments
due under the license or settlement
agreement, as applicable.
(3) Distribution of royalties and settlement monies
by collective.--The collective described in paragraph
(2) shall, in accordance with subparagraphs (B) through
(D) of section 114(g)(2), and paragraphs (5) and (6) of
section 114(g), distribute the royalties or settlement
monies received under paragraph (2) under a license or
settlement described in paragraph (2), which shall be
the only payments to which featured and nonfeatured
artists are entitled by virtue of the transmissions
described in paragraph (2), except for settlement
monies described in paragraph (2) that are distributed
by the rights owner to featured and nonfeatured artists
before the date of enactment of this section.
(4) Payment of royalties under license agreements
entered before enactment or not otherwise described in
paragraph (2).--
(A) In general.--To the extent that a license
agreement described in paragraph (1) entered
into before the date of enactment of this
section, or any other license agreement not as
described in paragraph (2), extends to a public
performance by means of [a digital audio] an
audio transmission of a sound recording fixed
before February 15, 1972, that meets the
conditions of subsection (b), the payments made
by the licensee pursuant to the license shall
be made in accordance with the agreement.
(B) Additional payments not required.--To the
extent that a licensee has made, or will make
in the future, payments pursuant to a license
as described in subparagraph (A), the
provisions of paragraphs (2) and (3) shall not
require any additional payments from, or
additional financial obligations on the part
of, the licensee.
(C) Rule of construction.--Nothing in this
subsection may be construed to prohibit the
collective designated to distribute receipts
from the licensing of transmissions in
accordance with section 114(f) from
administering royalty payments under any
license not described in paragraph (2).
(e) Preemption With Respect to Certain Past Acts.--
(1) In general.--This section preempts any claim of
common law copyright or equivalent right under the laws
of any State arising from a digital audio transmission
or reproduction that is made before the date of
enactment of this section of a sound recording fixed
before February 15, 1972, if--
(A) the digital audio transmission would have
satisfied the requirements for statutory
licensing under section 114(d)(2) or been
exempt under section 114(d)(1), or the
reproduction would have satisfied the
requirements of section 112(e)(1), as the case
may be, if the sound recording were fixed on or
after February 15, 1972; and
(B) either--
(i) except in the case of a
transmission that would have been
exempt under section 114(d)(1), not
later than 270 days after the date of
enactment of this section, the
transmitting entity pays statutory
royalties and provides notice of the
use of the relevant sound recordings in
the same manner as required by
regulations adopted by the Copyright
Royalty Judges for sound recordings
that are fixed on or after February 15,
1972, for all the digital audio
transmissions and reproductions
satisfying the requirements for
statutory licensing under sections
112(e)(1) and 114(d)(2) during the 3
years before that date of enactment; or
(ii) an agreement voluntarily
negotiated between the rights owner and
the entity performing the sound
recording (including a litigation
settlement agreement entered into
before the date of enactment of this
section) authorizes or waives liability
for any such transmission or
reproduction and the transmitting
entity has paid for and reported such
digital audio transmission under that
agreement.
(2) Rule of construction for common law copyright.--
For purposes of paragraph (1), a claim of common law
copyright or equivalent right under the laws of any
State includes a claim that characterizes conduct
subject to that paragraph as an unlawful distribution,
act of record piracy, or similar violation.
(3) Rule of construction for public performance
rights.--Nothing in this section may be construed to
recognize or negate the existence of public performance
rights in sound recordings under the laws of any State.
(f) Limitations on Remedies.--
(1) Fair use; uses by libraries, archives, and
educational institutions.--
(A) In general.--The limitations on the
exclusive rights of a copyright owner described
in sections 107, 108, 109, 110, and 112(f)
shall apply to a claim under subsection (a)
with respect to a sound recording fixed before
February 15, 1972.
(B) Rule of construction for section
108(h).--With respect to the application of
section 108(h) to a claim under subsection (a)
with respect to a sound recording fixed before
February 15, 1972, the phrase ``during the last
20 years of any term of copyright of a
published work'' in such section 108(h) shall
be construed to mean at any time after the date
of enactment of this section.
(2) Actions.--The limitations on actions described in
section 507 shall apply to a claim under subsection (a)
with respect to a sound recording fixed before February
15, 1972.
(3) Material online.--Section 512 shall apply to a
claim under subsection (a) with respect to a sound
recording fixed before February 15, 1972.
(4) Principles of equity.--Principles of equity apply
to remedies for a violation of this section to the same
extent as such principles apply to remedies for
infringement of copyright.
(5) Filing requirement for statutory damages and
attorneys' fees.--
(A) Filing of information on sound
recordings.--
(i) Filing requirement.--Except in
the case of a transmitting entity that
has filed contact information for that
transmitting entity under subparagraph
(B), in any action under this section,
an award of statutory damages or of
attorneys' fees under section 504 or
505 may be made with respect to an
unauthorized use of a sound recording
under subsection (a) only if--
(I) the rights owner has
filed with the Copyright Office
a schedule that specifies the
title, artist, and rights owner
of the sound recording and
contains such other
information, as practicable, as
the Register of Copyrights
prescribes by regulation; and
(II) the use occurs after the
end of the 90-day period
beginning on the date on which
the information described in
subclause (I) is indexed into
the public records of the
Copyright Office.
(ii) Regulations.--Not later than 180
days after the date of enactment of
this section, the Register of
Copyrights shall issue regulations
that--
(I) establish the form,
content, and procedures for the
filing of schedules under
clause (i);
(II) provide that a person
may request that the person
receive timely notification of
a filing described in subclause
(I); and
(III) set forth the manner in
which a person may make a
request under subclause (II).
(B) Filing of contact information for
transmitting entities.--
(i) Filing requirement.--Not later
than 30 days after the date of
enactment of this section, the Register
of Copyrights shall issue regulations
establishing the form, content, and
procedures for the filing of contact
information by any entity that, as of
the date of enactment of this section,
performs a sound recording fixed before
February 15, 1972, by means of a
digital audio transmission.
(ii) Time limit on filings.--The
Register of Copyrights may accept
filings under clause (i) only until the
180th day after the date of enactment
of this section.
(iii) Limitation on statutory damages
and attorneys' fees.--
(I) Limitation.--An award of
statutory damages or of
attorneys' fees under section
504 or 505 may not be made
against an entity that has
filed contact information for
that entity under clause (i)
with respect to an unauthorized
use by that entity of a sound
recording under subsection (a)
if the use occurs before the
end of the 90-day period
beginning on the date on which
the entity receives a notice
that--
(aa) is sent by or on
behalf of the rights
owner of the sound
recording;
(bb) states that the
entity is not legally
authorized to use that
sound recording under
subsection (a); and
(cc) identifies the
sound recording in a
schedule conforming to
the requirements
prescribed by the
regulations issued
under subparagraph
(A)(ii).
(II) Undeliverable notices.--
In any case in which a notice
under subclause (I) is sent to
an entity by mail or courier
service and the notice is
returned to the sender because
the entity either is no longer
located at the address provided
in the contact information
filed under clause (i) or has
refused to accept delivery, or
the notice is sent by
electronic mail and is
undeliverable, the 90-day
period under subclause (I)
shall begin on the date of the
attempted delivery.
(C) Section 412.--Section 412 shall not limit
an award of statutory damages under section
504(c) or attorneys' fees under section 505
with respect to a covered activity in violation
of subsection (a).
(6) Applicability of other provisions.--
(A) In general.--Subject to subparagraph (B),
no provision of this title shall apply to or
limit the remedies available under this section
except as otherwise provided in this section.
(B) Applicability of definitions.--Any term
used in this section that is defined in section
101 shall have the meaning given that term in
section 101.
(g) Application of Section 230 Safe Harbor.--For purposes of
section 230 of the Communications Act of 1934 (47 U.S.C. 230),
subsection (a) shall be considered to be a ``law pertaining to
intellectual property'' under subsection (e)(2) of such section
230.
(h) Application to Rights Owners.--
(1) Transfers.--With respect to a rights owner
described in subsection (l)(2)(B)--
(A) subsections (d) and (e) of section 201
and section 204 shall apply to a transfer
described in subsection (l)(2)(B) to the same
extent as with respect to a transfer of
copyright ownership; and
(B) notwithstanding section 411, that rights
owner may institute an action with respect to a
violation of this section to the same extent as
the owner of an exclusive right under a
copyright may institute an action under section
501(b).
(2) Application of other provisions.--The following
provisions shall apply to a rights owner under this
section to the same extent as any copyright owner:
(A) Section 112(e)(2).
(B) Section 112(e)(7).
(C) Section 114(e).
(D) Section 114(h).
(i) Ephemeral Recordings.--An authorized reproduction made
under this section shall be subject to section 112(g) to the
same extent as a reproduction of a sound recording fixed on or
after February 15, 1972.
(j) Rule of Construction.--A rights owner of, or featured
recording artist who performs on, a sound recording under this
chapter shall be deemed to be an interested copyright party, as
defined in section 1001, to the same extent as a copyright
owner or featured recording artist under chapter 10.
(k) Treatment of States and State Instrumentalities,
Officers, and Employees.--Any State, and any instrumentality,
officer, or employee described in subsection (a)(3), shall be
subject to the provisions of this section in the same manner
and to the same extent as any nongovernmental entity.
(l) Definitions.--In this section:
(1) Covered activity.--The term ``covered activity''
means any activity that the copyright owner of a sound
recording would have the exclusive right to do or
authorize under section 106 or 602, or that would
violate section 1201 or 1202, if the sound recording
were fixed on or after February 15, 1972.
(2) Rights owner.--The term ``rights owner'' means--
(A) the person that has the exclusive right
to reproduce a sound recording under the laws
of any State, as of the day before the date of
enactment of this section; or
(B) any person to which a right to enforce a
violation of this section may be transferred,
in whole or in part, after the date of
enactment of this section, under--
(i) subsections (d) and (e) of
section 201; and
(ii) section 204.
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