[United States Statutes at Large, Volume 118, 108th Congress, 2nd Session]
[From the U.S. Government Publishing Office, www.gpo.gov]

118 STAT. 2341

Public Law 108-419
108th Congress

An Act


 
To amend title 17, United States Code, to replace copyright arbitration
royalty panels with Copyright Royalty Judges, and for other
purposes. NOTE: Nov. 30, 2004 -  [H.R. 1417]

Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, NOTE: Copyright
Royalty and Distribution Reform Act of 2004.

SECTION 1. SHORT TITLE. NOTE: 17 USC 101 note.

This Act may be cited as the ``Copyright Royalty and Distribution
Reform Act of 2004''.

SEC. 2. REFERENCE.

Except as otherwise expressly provided, whenever in this Act an
amendment or repeal is expressed in terms of an amendment to, or repeal
of, a section or other provision, the reference shall be considered to
be made to a section or other provision of title 17, United States Code.

SEC. 3. COPYRIGHT ROYALTY JUDGE AND STAFF.

(a) In General.--Chapter 8 is amended to read as follows:

``CHAPTER 8--PROCEEDINGS BY COPYRIGHT ROYALTY JUDGES

``Sec.
``801. Copyright Royalty Judges; appointment and functions.
``802. Copyright Royalty Judgeships; staff.
``803. Proceedings of Copyright Royalty Judges.
``804. Institution of proceedings.
``805. General rule for voluntarily negotiated agreements.

``Sec. 801. Copyright Royalty Judges; appointment and functions

``(a) Appointment.--The Librarian of Congress shall appoint 3 full-
time Copyright Royalty Judges, and shall appoint 1 of the 3 as the Chief
Copyright Royalty Judge. The Librarian shall make appointments to such
positions after consultation with the Register of Copyrights.
``(b) Functions.--Subject to the provisions of this chapter, the
functions of the Copyright Royalty Judges shall be as follows:
``(1) To make determinations and adjustments of reasonable
terms and rates of royalty payments as provided in sections
112(e), 114, 115, 116, 118, 119 and 1004. The rates applicable
under sections 114(f)(1)(B), 115, and 116 shall be calculated to
achieve the following objectives:
``(A) To maximize the availability of creative works
to the public.

[[Page 2342]]
118 STAT. 2342

``(B) To afford the copyright owner a fair return
for his or her creative work and the copyright user a
fair income under existing economic conditions.
``(C) To reflect the relative roles of the copyright
owner and the copyright user in the product made
available to the public with respect to relative
creative contribution, technological contribution,
capital investment, cost, risk, and contribution to the
opening of new markets for creative expression and media
for their communication.
``(D) To minimize any disruptive impact on the
structure of the industries involved and on generally
prevailing industry practices.
``(2) To make determinations concerning the adjustment of
the copyright royalty rates under section 111 solely in
accordance with the following provisions:
``(A) The rates established by section 111(d)(1)(B)
may be adjusted to reflect--
``(i) national monetary inflation or
deflation; or
``(ii) changes in the average rates charged
cable subscribers for the basic service of
providing secondary transmissions to maintain the
real constant dollar level of the royalty fee per
subscriber which existed as of the date of October
19, 1976,
except that--
``(I) if the average rates charged cable
system subscribers for the basic service of
providing secondary transmissions are changed so
that the average rates exceed national monetary
inflation, no change in the rates established by
section 111(d)(1)(B) shall be permitted; and
``(II) no increase in the royalty fee shall be
permitted based on any reduction in the average
number of distant signal equivalents per
subscriber.
The Copyright Royalty Judges may consider all factors
relating to the maintenance of such level of payments,
including, as an extenuating factor, whether the
industry has been restrained by subscriber rate
regulating authorities from increasing the rates for the
basic service of providing secondary transmissions.
``(B) In the event that the rules and regulations of
the Federal Communications Commission are amended at any
time after April 15, 1976, to permit the carriage by
cable systems of additional television broadcast signals
beyond the local service area of the primary
transmitters of such signals, the royalty rates
established by section 111(d)(1)(B) may be adjusted to
ensure that the rates for the additional distant signal
equivalents resulting from such carriage are reasonable
in the light of the changes effected by the amendment to
such rules and regulations. In determining the
reasonableness of rates proposed following an amendment
of Federal Communications Commission rules and
regulations, the Copyright Royalty Judges shall
consider, among other factors, the economic impact on
copyright owners and users; except that no adjustment in
royalty rates shall be made under this subparagraph with
respect to any distant signal equivalent or fraction
thereof represented by--

[[Page 2343]]
118 STAT. 2343

``(i) carriage of any signal permitted under
the rules and regulations of the Federal
Communications Commission in effect on April 15,
1976, or the carriage of a signal of the same type
(that is, independent, network, or noncommercial
educational) substituted for such permitted
signal; or
``(ii) a television broadcast signal first
carried after April 15, 1976, pursuant to an
individual waiver of the rules and regulations of
the Federal Communications Commission, as such
rules and regulations were in effect on April 15,
1976.
``(C) In the event of any change in the rules and
regulations of the Federal Communications Commission
with respect to syndicated and sports program
exclusivity after April 15, 1976, the rates established
by section 111(d)(1)(B) may be adjusted to assure that
such rates are reasonable in light of the changes to
such rules and regulations, but any such adjustment
shall apply only to the affected television broadcast
signals carried on those systems affected by the change.
``(D) The gross receipts limitations established by
section 111(d)(1) (C) and (D) shall be adjusted to
reflect national monetary inflation or deflation or
changes in the average rates charged cable system
subscribers for the basic service of providing secondary
transmissions to maintain the real constant dollar value
of the exemption provided by such section, and the
royalty rate specified therein shall not be subject to
adjustment.
``(3)(A) To authorize the distribution, under sections 111,
119, and 1007, of those royalty fees collected under sections
111, 119, and 1005, as the case may be, to the extent that the
Copyright Royalty Judges have found that the distribution of
such fees is not subject to controversy.
``(B) In cases where the Copyright Royalty Judges determine
that controversy exists, the Copyright Royalty Judges shall
determine the distribution of such fees, including partial
distributions, in accordance with section 111, 119, or 1007, as
the case may be.
``(C) The Copyright Royalty Judges may make a partial
distribution of such fees during the pendency of the proceeding
under subparagraph (B) if all participants under section
803(b)(2) in the proceeding that are entitled to receive those
fees that are to be partially distributed--
``(i) agree to such partial distribution;
``(ii) sign an agreement obligating them to return
any excess amounts to the extent necessary to comply
with the final determination on the distribution of the
fees made under subparagraph (B);
``(iii) file the agreement with the Copyright
Royalty Judges; and
``(iv) agree that such funds are available for
distribution.
``(D) The Copyright Royalty Judges and any other officer or
employee acting in good faith in distributing funds under
subparagraph (C) shall not be held liable for the payment of any
excess fees under subparagraph (C). The Copyright

[[Page 2344]]
118 STAT. 2344

Royalty Judges shall, at the time the final determination is
made, calculate any such excess amounts.
``(4) To accept or reject royalty claims filed under
sections 111, 119, and 1007, on the basis of timeliness or the
failure to establish the basis for a claim.
``(5) To accept or reject rate adjustment petitions as
provided in section 804 and petitions to participate as provided
in section 803(b) (1) and (2).
``(6) To determine the status of a digital audio recording
device or a digital audio interface device under sections 1002
and 1003, as provided in section 1010.
``(7)(A) To adopt as a basis for statutory terms and rates
or as a basis for the distribution of statutory royalty
payments, an agreement concerning such matters reached among
some or all of the participants in a proceeding at any time
during the proceeding, except that--
``(i) the Copyright Royalty Judges shall provide to
those that would be bound by the terms, rates, or other
determination set by any agreement in a proceeding to
determine royalty rates an opportunity to comment on the
agreement and shall provide to participants in the
proceeding under section 803(b)(2) that would be bound
by the terms, rates, or other determination set by the
agreement an opportunity to comment on the agreement and
object to its adoption as a basis for statutory terms
and rates; and
``(ii) the Copyright Royalty Judges may decline to
adopt the agreement as a basis for statutory terms and
rates for participants that are not parties to the
agreement, if any participant described in clause (i)
objects to the agreement and the Copyright Royalty
Judges conclude, based on the record before them if one
exists, that the agreement does not provide a reasonable
basis for setting statutory terms or rates.
``(B) License agreements voluntarily negotiated pursuant to
section 112(e)(5), 114(f)(3), 115(c)(3)(E)(i), 116(c), or
118(b)(2) that do not result in statutory terms and rates shall
not be subject to clauses (i) and (ii) of subparagraph (A).
``(C) Interested parties may negotiate and agree to, and the
Copyright Royalty Judges may adopt, an agreement that specifies
as terms notice and recordkeeping requirements that apply in
lieu of those that would otherwise apply under regulations.
``(8) To perform other duties, as assigned by the Register
of Copyrights within the Library of Congress, except as provided
in section 802(g), at times when Copyright Royalty Judges are
not engaged in performing the other duties set forth in this
section.

``(c) Rulings.--The Copyright Royalty Judges may make any necessary
procedural or evidentiary rulings in any proceeding under this chapter
and may, before commencing a proceeding under this chapter, make any
such rulings that would apply to the proceedings conducted by the
Copyright Royalty Judges.
``(d) Administrative Support.--The Librarian of Congress shall
provide the Copyright Royalty Judges with the necessary administrative
services related to proceedings under this chapter.

[[Page 2345]]
118 STAT. 2345

``(e) Location in Library of Congress.--The offices of the Copyright
Royalty Judges and staff shall be in the Library of Congress.

``Sec. 802. Copyright Royalty Judgeships; staff

``(a) Qualifications of Copyright Royalty Judges.--
``(1) In general.--Each Copyright Royalty Judge shall be an
attorney who has at least 7 years of legal experience. The Chief
Copyright Royalty Judge shall have at least 5 years of
experience in adjudications, arbitrations, or court trials. Of
the other 2 Copyright Royalty Judges, 1 shall have significant
knowledge of copyright law, and the other shall have significant
knowledge of economics. An individual may serve as a Copyright
Royalty Judge only if the individual is free of any financial
conflict of interest under subsection (h).
``(2) Definition.--In this subsection, the term
`adjudication' has the meaning given that term in section 551 of
title 5, but does not include mediation.

``(b) Staff.--The Chief Copyright Royalty Judge shall hire 3 full-
time staff members to assist the Copyright Royalty Judges in performing
their functions.
``(c) Terms.--The individual first appointed as the Chief Copyright
Royalty Judge shall be appointed to a term of 6 years, and of the
remaining individuals first appointed as Copyright Royalty Judges, 1
shall be appointed to a term of 4 years, and the other shall be
appointed to a term of 2 years. Thereafter, the terms of succeeding
Copyright Royalty Judges shall each be 6 years. An individual serving as
a Copyright Royalty Judge may be reappointed to subsequent terms. The
term of a Copyright Royalty Judge shall begin when the term of the
predecessor of that Copyright Royalty Judge ends. When the term of
office of a Copyright Royalty Judge ends, the individual serving that
term may continue to serve until a successor is selected.
``(d) Vacancies or Incapacity.--
``(1) Vacancies.--If a vacancy should occur in the position
of Copyright Royalty Judge, the Librarian of Congress shall act
expeditiously to fill the vacancy, and may appoint an interim
Copyright Royalty Judge to serve until another Copyright Royalty
Judge is appointed under this section. An individual appointed
to fill the vacancy occurring before the expiration of the term
for which the predecessor of that individual was appointed shall
be appointed for the remainder of that term.
``(2) Incapacity.--In the case in which a Copyright Royalty
Judge is temporarily unable to perform his or her duties, the
Librarian of Congress may appoint an interim Copyright Royalty
Judge to perform such duties during the period of such
incapacity.

``(e) Compensation.--
``(1) Judges.--The Chief Copyright Royalty Judge shall
receive compensation at the rate of basic pay payable for level
AL-1 for administrative law judges pursuant to section 5372(b)
of title 5, and each of the other two Copyright Royalty Judges
shall receive compensation at the rate of basic pay payable for
level AL-2 for administrative law judges pursuant to such
section. The compensation of the Copyright Royalty Judges shall
not be subject to any regulations adopted by the Office

[[Page 2346]]
118 STAT. 2346

of Personnel Management pursuant to its authority under section
5376(b)(1) of title 5.
``(2) Staff members.--Of the staff members appointed under
subsection (b)--
``(A) the rate of pay of 1 staff member shall be not
more than the basic rate of pay payable for level 10 of
GS-15 of the General Schedule;
``(B) the rate of pay of 1 staff member shall be not
less than the basic rate of pay payable for GS-13 of the
General Schedule and not more than the basic rate of pay
payable for level 10 of GS-14 of such Schedule; and
``(C) the rate of pay for the third staff member
shall be not less than the basic rate of pay payable for
GS-8 of the General Schedule and not more than the basic
rate of pay payable for level 10 of GS-11 of such
Schedule.
``(3) Locality pay.--All rates of pay referred to under this
subsection shall include locality pay.

``(f) Independence of Copyright Royalty Judge.--
``(1) In making determinations.--
``(A) In general.--(i) Subject to clause (ii) of
this subparagraph and subparagraph (B), the Copyright
Royalty Judges shall have full independence in making
determinations concerning adjustments and determinations
of copyright royalty rates and terms, the distribution
of copyright royalties, the acceptance or rejection of
royalty claims, rate adjustment petitions, and petitions
to participate, and in issuing other rulings under this
title, except that the Copyright Royalty Judges may
consult with the Register of Copyrights on any matter
other than a question of fact.
``(ii) A Copyright Royalty Judge or Judges, or, by
motion to the Copyright Royalty Judge or Judges, any
participant in a proceeding may request an
interpretation by the Register of Copyrights concerning
any material question of substantive law (not including
questions of procedure before the Copyright Royalty
Judges, the ultimate adjustments and determinations of
copyright royalty rates and terms, the ultimate
distribution of copyright royalties, or the acceptance
or rejection of royalty claims, rate adjustment
petitions, or petitions to participate) concerning an
interpretation or construction of those provisions of
this title that are the subject of the proceeding. Any
such request for a written interpretation by the
Register of Copyrights shall be on the record.
Reasonable provision shall be made for comment by the
participants in the proceeding on the material question
of substantive law in such a way as to minimize
duplication and delay. NOTE: Deadline. Except as
provided in subparagraph (B), the Register of Copyrights
shall deliver to the Copyright Royalty Judges a response
within 14 days after the Register of Copyrigts receives
all of the briefs or comments of the
participants. NOTE: Records. Such decision shall be
in writing and shall be included by the Copyright
Royalty Judges in the record that accompanies their
final determination. If such a decision is timely
delivered to the Copyright Royalty Judges, the Copyright
Royalty Judges shall apply the legal interpretation
embodied in the response of the Register of Copyrights
in resolving material questions of substantive law.

[[Page 2347]]
118 STAT. 2347

``(B) Novel questions.--(i) In any case in which a
novel material question of substantive law concerning an
interpretation of those provisions of this title that
are the subject of the proceeding is presented, the
Copyright Royalty Judges shall request a decision of the
Register of Copyrights, in writing, to resolve such
novel question. Reasonable provision shall be made for
comment on such request by the participants in the
proceeding, in such a way as to minimize duplication and
delay. NOTE: Deadline. The Register of Copyrights
shall transmit his or her decision to the Copyright
Royalty Judges within 30 days after the Register of
Copyrights receives all of the briefs or comments of the
participants. NOTE: Records. Such decision shall be
in writing and included by the Copyright Royalty Judges
in the record that accompanies their final
determination. If such a decision is timely delivered to
the Copyright Royalty Judges, the Copyright Royalty
Judges shall apply the legal determinations embodied in
the decision of the Register of Copyrights in resolving
material questions of substantive law.
``(ii) In clause (i), a `novel question of law' is a
question of law that has not been determined in prior
decisions, determinations, and rulings described in
section 803(a).
``(C) Consultation.--Notwithstanding the provisions
of subparagraph (A), the Copyright Royalty Judges shall
consult with the Register of Copyrights with respect to
any determination or ruling that would require that any
act be performed by the Copyright Office, and any such
determination or ruling shall not be binding upon the
Register of Copyrights.
``(D) Review of legal conclusions by the register of
copyrights.--The Register of Copyrights may review for
legal error the resolution by the Copyright Royalty
Judges of a material question of substantive law under
this title that underlies or is contained in a final
determination of the Copyright Royalty
Judges. NOTE: Records. If the Register of Copyrights
concludes, after taking into consideration the views of
the participants in the proceeding, that any resolution
reached by the Copyright Royalty Judges was in material
error, the Register of Copyrights shall issue a written
decision correcting such legal error, which shall be
made part of the record of the
proceeding. NOTE: Deadline. The Register of
Copyrights shall issue such written decision not later
than 60 days after the date on which the final
determination by the Copyright Royalty Judges is
issued. NOTE: Federal
Register, publication. Additionally, the Register of
Copyrights shall cause to be published in the Federal
Register such written decision, together with a specific
identification of the legal conclusion of the Copyright
Royalty Judges that is determined to be erroneous. As to
conclusions of substantive law involving an
interpretation of the statutory provisions of this
title, the decision of the Register of Copyrights shall
be binding as precedent upon the Copyright Royalty
Judges in subsequent proceedings under this chapter.
When a decision has been rendered pursuant to this
subparagraph, the Register of Copyrights may, on the
basis of and in accordance with such decision, intervene
as of right in any appeal of a final determination of
the Copyright Royalty Judges

[[Page 2348]]
118 STAT. 2348

pursuant to section 803(d) in the United States Court of
Appeals for the District of Columbia Circuit. If, prior
to intervening in such an appeal, the Register of
Copyrights gives notification to, and undertakes to
consult with the Attorney General with respect to such
intervention, and the Attorney General fails, within a
reasonable period after receiving such notification, to
intervene in such appeal, the Register of Copyrights may
intervene in such appeal in his or her own name by any
attorney designated by the Register of Copyrights for
such purpose. Intervention by the Register of Copyrights
in his or her own name shall not preclude the Attorney
General from intervening on behalf of the United States
in such an appeal as may be otherwise provided or
required by law.
``(E) Effect on judicial review.--Nothing in this
section shall be interpreted to alter the standard
applied by a court in reviewing legal determinations
involving an interpretation or construction of the
provisions of this title or to affect the extent to
which any construction or interpretation of the
provisions of this title shall be accorded deference by
a reviewing court.
``(2) Performance appraisals.--
``(A) In general.--Notwithstanding any other
provision of law or any regulation of the Library of
Congress, and subject to subparagraph (B), the Copyright
Royalty Judges shall not receive performance appraisals.
``(B) Relating to sanction or removal.--To the
extent that the Librarian of Congress adopts regulations
under subsection (h) relating to the sanction or removal
of a Copyright Royalty Judge and such regulations
require documentation to establish the cause of such
sanction or removal, the Copyright Royalty Judge may
receive an appraisal related specifically to the cause
of the sanction or removal.

``(g) Inconsistent Duties Barred.--No Copyright Royalty Judge may
undertake duties that conflict with his or her duties and
responsibilities as a Copyright Royalty Judge.
``(h) NOTE: Regulations. Standards of Conduct.--The Librarian of
Congress shall adopt regulations regarding the standards of conduct,
including financial conflict of interest and restrictions against ex
parte communications, which shall govern the Copyright Royalty Judges
and the proceedings under this chapter.

``(i) Removal or Sanction.--The Librarian of Congress may sanction
or remove a Copyright Royalty Judge for violation of the standards of
conduct adopted under subsection (h), misconduct, neglect of duty, or
any disqualifying physical or mental disability.
Any NOTE: Notice. such sanction or removal may be made only after
notice and opportunity for a hearing, but the Librarian of Congress may
suspend the Copyright Royalty Judge during the pendency of such hearing.
The Librarian shall appoint an interim Copyright Royalty Judge during
the period of any such suspension.

``Sec. 803. Proceedings of Copyright Royalty Judges

``(a) Proceedings.--
``(1) NOTE: Regulations. Records. In general.--The
Copyright Royalty Judges shall act in accordance with
regulations issued by the Copyright Royalty Judges and the
Librarian of Congress, and on the basis of

[[Page 2349]]
118 STAT. 2349

a written record, prior determinations and interpretations of
the Copyright Royalty Tribunal, Librarian of Congress, the
Register of Copyrights, and the Copyright Royalty Judges (to the
extent those determinations are not inconsistent with a decision
of the Register of Copyrights that was timely delivered to the
Copyright Royalty Judges pursuant to section 802(f)(1) (A) or
(B), or with a decision of the Register of Copyrights pursuant
to section 802(f)(1)(D)), under this chapter, and decisions of
the court of appeals under this chapter before, on, or after the
effective date of the Copyright Royalty and Distribution Reform
Act of 2004.
``(2) Judges acting as panel and individually.--The
Copyright Royalty Judges shall preside over hearings in
proceedings under this chapter en banc. The Chief Copyright
Royalty Judge may designate a Copyright Royalty Judge to preside
individually over such collateral and administrative
proceedings, and over such proceedings under paragraphs (1)
through (5) of subsection (b), as the Chief Judge considers
appropriate.
``(3) Determinations.--Final determinations of the Copyright
Royalty Judges in proceedings under this chapter shall be made
by majority vote. A Copyright Royalty Judge dissenting from the
majority on any determination under this chapter may issue his
or her dissenting opinion, which shall be included with the
determination.

``(b) Procedures.--
``(1) Initiation.--
``(A) NOTE: Federal
Register, publication. Notices. Deadlines. Call for
petitions to participate.--(i) The Copyright Royalty
Judges shall cause to be published in the Federal
Register notice of commencement of proceedings under
this chapter, calling for the filing of petitions to
participate in a proceeding under this chapter for the
purpose of making the relevant determination under
section 111, 112, 114, 115, 116, 118, 119, 1004, or
1007, as the case may be--
``(I) promptly upon a determination made under
section 804(a);
``(II) by no later than January 5 of a year
specified in paragraph (2) of section 804(b) for
the commencement of proceedings;
``(III) by no later than January 5 of a year
specified in subparagraph (A) or (B) of paragraph
(3) of section 804(b) for the commencement of
proceedings, or as otherwise provided in
subparagraph (A) or (C) of such paragraph for the
commencement of proceedings;
``(IV) as provided under section 804(b)(8); or
``(V) by no later than January 5 of a year
specified in any other provision of section 804(b)
for the filing of petitions for the commencement
of proceedings, if a petition has not been filed
by that date.
``(ii) Petitions to participate shall be filed by no
later than 30 days after publication of notice of
commencement of a proceeding under clause (i), except
that the Copyright Royalty Judges may, for substantial
good cause shown and if there is no prejudice to the
participants that have already filed petitions, accept
late petitions to participate at any time up to the date
that is 90 days before the

[[Page 2350]]
118 STAT. 2350

date on which participants in the proceeding are to file
their written direct statements. Notwithstanding the
preceding sentence, petitioners whose petitions are
filed more than 30 days after publication of notice of
commencement of a proceeding are not eligible to object
to a settlement reached during the voluntary negotiation
period under paragraph (3), and any objection filed by
such a petitioner shall not be taken into account by the
Copyright Royalty Judges.
``(B) Petitions to participate.--Each petition to
participate in a proceeding shall describe the
petitioner's interest in the subject matter of the
proceeding. Parties with similar interests may file a
single petition to participate.
``(2) Participation in general.--Subject to paragraph (4), a
person may participate in a proceeding under this chapter,
including through the submission of briefs or other information,
only if--
``(A) that person has filed a petition to
participate in accordance with paragraph (1) (either
individually or as a group under paragraph (1)(B)),
together with a filing fee of $150;
``(B) the Copyright Royalty Judges have not
determined that the petition to participate is facially
invalid; and
``(C) the Copyright Royalty Judges have not
determined, sua sponte or on the motion of another
participant in the proceeding, that the person lacks a
significant interest in the proceeding.
``(3) Voluntary negotiation period.--
``(A) NOTE: Records. In general.--Promptly after
the date for filing of petitions to participate in a
proceeding, the Copyright Royalty Judges shall make
available to all participants in the proceeding a list
of such participants and shall initiate a voluntary
negotiation period among the participants.
``(B) Length of proceedings.--The voluntary
negotiation period initiated under subparagraph (A)
shall be 3 months.
``(C) Determination of subsequent proceedings.--At
the close of the voluntary negotiation proceedings, the
Copyright Royalty Judges shall, if further proceedings
under this chapter are necessary, determine whether and
to what extent paragraphs (4) and (5) will apply to the
parties.
``(4) Small claims procedure in distribution proceedings.--
``(A) In general.--If, in a proceeding under this
chapter to determine the distribution of royalties, the
contested amount of a claim is $10,000 or less, the
Copyright Royalty Judges shall decide the controversy on
the basis of the filing of the written direct statement
by the participant, the response by any opposing
participant, and 1 additional response by each such
party. The participant asserting the claim shall not be
required to pay the filing fee under paragraph (2).
``(B) Bad faith inflation of claim.--If the
Copyright Royalty Judges determine that a participant
asserts in

[[Page 2351]]
118 STAT. 2351

bad faith an amount in controversy in excess of $10,000
for the purpose of avoiding a determination under the
procedure set forth in subparagraph (A), the Copyright
Royalty Judges shall impose a fine on that participant
in an amount not to exceed the difference between the
actual amount distributed and the amount asserted by the
participant.
``(5) Paper proceedings.--The Copyright Royalty Judges in
proceedings under this chapter may decide, sua sponte or upon
motion of a participant, to determine issues on the basis of the
filing of the written direct statement by the participant, the
response by any opposing participant, and one additional
response by each such participant. Prior to making such decision
to proceed on such a paper record only, the Copyright Royalty
Judges shall offer to all parties to the proceeding the
opportunity to comment on the decision. The procedure under this
paragraph--
``(A) NOTE: Applicability. shall be applied in
cases in which there is no genuine issue of material
fact, there is no need for evidentiary hearings, and all
participants in the proceeding agree in writing to the
procedure; and
``(B) may be applied under such other circumstances
as the Copyright Royalty Judges consider appropriate.
``(6) Regulations.--
``(A) In general.--The Copyright Royalty Judges may
issue regulations to carry out their functions under
this title. All regulations issued by the Copyright
Royalty Judges are subject to the approval of the
Librarian of Congress. NOTE: Deadline. Not later
than 120 days after Copyright Royalty Judges or interim
Copyright Royalty Judges, as the case may be, are first
appointed after the enactment of the Copyright Royalty
and Distribution Reform Act of 2004, such judges shall
issue regulations to govern proceedings under this
chapter.
``(B) NOTE: Applicability. Interim
regulations.--Until regulations are adopted under
subparagraph (A), the Copyright Royalty Judges shall
apply the regulations in effect under this chapter on
the day before the effective date of the Copyright
Royalty and Distribution Reform Act of 2004, to the
extent such regulations are not inconsistent with this
chapter, except that functions carried out under such
regulations by the Librarian of Congress, the Register
of Copyrights, or copyright arbitration royalty panels
that, as of such date of enactment, are to be carried
out by the Copyright Royalty Judges under this chapter,
shall be carried out by the Copyright Royalty Judges
under such regulations.
``(C) Requirements.--Regulations issued under
subparagraph (A) shall include the following:
``(i) NOTE: Deadlines. Records. The
written direct statements of all participants in a
proceeding under paragraph (2) shall be filed by a
date specified by the Copyright Royalty Judges,
which may be not earlier than 4 months, and not
later than 5 months, after the end of the
voluntary negotiation period under paragraph (3).
Notwithstanding the preceding sentence, the
Copyright Royalty Judges may allow a participant
in a proceeding to file an amended written direct
statement based on

[[Page 2352]]
118 STAT. 2352

new information received during the discovery
process, within 15 days after the end of the
discovery period specified in clause (iii).
``(ii)(I) Following the submission to the
Copyright Royalty Judges of written direct
statements by the participants in a proceeding
under paragraph (2), the judges shall meet with
the participants for the purpose of setting a
schedule for conducting and completing discovery.
Such schedule shall be determined by the Copyright
Royalty Judges.
``(II) In this chapter, the term `written
direct statements' means witness statements,
testimony, and exhibits to be presented in the
proceedings, and such other information that is
necessary to establish terms and rates, or the
distribution of royalty payments, as the case may
be, as set forth in regulations issued by the
Copyright Royalty Judges.
``(iii) Hearsay may be admitted in proceedings
under this chapter to the extent deemed
appropriate by the Copyright Royalty Judges.
``(iv) NOTE: Deadline. Discovery in such
proceedings shall be permitted for a period of 60
days, except for discovery ordered by the
Copyright Royalty Judges in connection with the
resolution of motions, orders, and disputes
pending at the end of such period.
``(v) Any participant under paragraph (2) in a
proceeding under this chapter to determine royalty
rates may request of an opposing participant
nonprivileged documents directly related to the
written direct statement or written rebuttal
statement of that participant. Any objection to
such a request shall be resolved by a motion or
request to compel production made to the Copyright
Royalty Judges in accordance with regulations
adopted by the Copyright Royalty Judges. Each
motion or request to compel discovery shall be
determined by the Copyright Royalty Judges, or by
a Copyright Royalty Judge when permitted under
subsection (a)(2). Upon such motion, the Copyright
Royalty Judges may order discovery pursuant to
regulations established under this paragraph.
``(vi)(I) Any participant under paragraph (2)
in a proceeding under this chapter to determine
royalty rates may, by means of written motion or
on the record, request of an opposing participant
or witness other relevant information and
materials if, absent the discovery sought, the
Copyright Royalty Judges' resolution of the
proceeding would be substantially impaired. In
determining whether discovery will be granted
under this clause, the Copyright Royalty Judges
may consider--
``(aa) whether the burden or expense
of producing the requested information
or materials outweighs the likely
benefit, taking into account the needs
and resources of the participants, the
importance of the issues at stake, and
the probative value of the requested
information or materials in resolving
such issues;

[[Page 2353]]
118 STAT. 2353

``(bb) whether the requested
information or materials would be
unreasonably cumulative or duplicative,
or are obtainable from another source
that is more convenient, less
burdensome, or less expensive; and
``(cc) whether the participant
seeking discovery has had ample
opportunity by discovery in the
proceeding or by other means to obtain
the information sought.
``(II) This clause shall not apply to any
proceeding scheduled to commence after December
31, 2010.
``(vii) In a proceeding under this chapter to
determine royalty rates, the participants entitled
to receive royalties shall collectively be
permitted to take no more than 10 depositions and
secure responses to no more than 25
interrogatories, and the participants obligated to
pay royalties shall collectively be permitted to
take no more than 10 depositions and secure
responses to no more than 25 interrogatories. The
Copyright Royalty Judges shall resolve any
disputes among similarly aligned participants to
allocate the number of depositions or
interrogatories permitted under this clause.
``(viii) NOTE: Applicability. The rules
and practices in effect on the day before the
effective date of the Copyright Royalty and
Distribution Reform Act of 2004, relating to
discovery in proceedings under this chapter to
determine the distribution of royalty fees, shall
continue to apply to such proceedings on and after
such effective date.
``(ix) In proceedings to determine royalty
rates, the Copyright Royalty Judges may issue a
subpoena commanding a participant or witness to
appear and give testimony, or to produce and
permit inspection of documents or tangible things,
if the Copyright Royalty Judges' resolution of the
proceeding would be substantially impaired by the
absence of such testimony or production of
documents or tangible things. Such subpoena shall
specify with reasonable particularity the
materials to be produced or the scope and nature
of the required testimony. Nothing in this clause
shall preclude the Copyright Royalty Judges from
requesting the production by a nonparticipant of
information or materials relevant to the
resolution by the Copyright Royalty Judges of a
material issue of fact.
``(x) The Copyright Royalty Judges shall order
a settlement conference among the participants in
the proceeding to facilitate the presentation of
offers of settlement among the participants. The
settlement conference shall be held during a 21-
day period following the end of the discovery
period and shall take place outside the presence
of the Copyright Royalty Judges.
``(xi) No evidence, including exhibits, may be
submitted in the written direct statement or
written rebuttal statement of a participant
without a sponsoring witness, except where the
Copyright Royalty Judges have taken official
notice, or in the case of

[[Page 2354]]
118 STAT. 2354

incorporation by reference of past records, or for
good cause shown.

``(c) Determination of Copyright Royalty Judges.--
``(1) NOTE: Deadlines. Timing.--The Copyright Royalty
Judges shall issue their determination in a proceeding not later
than 11 months after the conclusion of the 21-day settlement
conference period under subsection (b)(6)(C)(x), but, in the
case of a proceeding to determine successors to rates or terms
that expire on a specified date, in no event later than 15 days
before the expiration of the then current statutory rates and
terms.
``(2) Rehearings.--
``(A) In general.--The Copyright Royalty Judges may,
in exceptional cases, upon motion of a participant in a
proceeding under subsection (b)(2), order a rehearing,
after the determination in the proceeding is issued
under paragraph (1), on such matters as the Copyright
Royalty Judges determine to be appropriate.
``(B) NOTE: Deadline. Timing for filing
motion.--Any motion for a rehearing under subparagraph
(A) may only be filed within 15 days after the date on
which the Copyright Royalty Judges deliver to the
participants in the proceeding their initial
determination concerning rates and terms.
``(C) Participation by opposing party not
required.--In any case in which a rehearing is ordered,
any opposing party shall not be required to participate
in the rehearing, except that nonparticipation may give
rise to the limitations with respect to judicial review
provided for in subsection (d)(1).
``(D) No negative inference.--No negative inference
shall be drawn from lack of participation in a
rehearing.
``(E) Continuity of rates and terms.--(i) If the
decision of the Copyright Royalty Judges on any motion
for a rehearing is not rendered before the expiration of
the statutory rates and terms that were previously in
effect, in the case of a proceeding to determine
successors to rates and terms that expire on a specified
date, then--
``(I) NOTE: Effective date. the initial
determination of the Copyright Royalty Judges that
is the subject of the rehearing motion shall be
effective as of the day following the date on
which the rates and terms that were previously in
effect expire; and
``(II) in the case of a proceeding under
section 114(f)(1)(C) or 114(f)(2)(C), royalty
rates and terms shall, for purposes of section
114(f)(4)(B), be deemed to have been set at those
rates and terms contained in the initial
determination of the Copyright Royalty Judges that
is the subject of the rehearing motion, as of the
date of that determination.
``(ii) The pendency of a motion for a rehearing
under this paragraph shall not relieve persons obligated
to make royalty payments who would be affected by the
determination on that motion from providing the
statements of account and any reports of use, to the
extent required, and paying the royalties required under
the relevant determination or regulations.
``(iii) NOTE: Deadlines. Notwithstanding clause
(ii), whenever royalties described in clause (ii) are
paid to a person other than

[[Page 2355]]
118 STAT. 2355

the Copyright Office, the entity designated by the
Copyright Royalty Judges to which such royalties are
paid by the copyright user (and any successor thereto)
shall, within 60 days after the motion for rehearing is
resolved or, if the motion is granted, within 60 days
after the rehearing is concluded, return any excess
amounts previously paid to the extent necessary to
comply with the final determination of royalty rates by
the Copyright Royalty Judges. Any underpayment of
royalties resulting from a rehearing shall be paid
within the same period.
``(3) NOTE: Records. Contents of determination.--A
determination of the Copyright Royalty Judges shall be supported
by the written record and shall set forth the findings of fact
relied on by the Copyright Royalty Judges. Among other terms
adopted in a determination, the Copyright Royalty Judges may
specify notice and recordkeeping requirements of users of the
copyrights at issue that apply in lieu of those that would
otherwise apply under regulations.
``(4) Continuing jurisdiction.--The Copyright Royalty Judges
may, with the approval of the Register of Copyrights, issue an
amendment to a written determination to correct any technical or
clerical errors in the determination or to modify the terms, but
not the rates, of royalty payments in response to unforeseen
circumstances that would frustrate the proper implementation of
such determination. NOTE: Federal
Register, publication. Such amendment shall be set forth in a
written addendum to the determination that shall be distributed
to the participants of the proceeding and shall be published in
the Federal Register.
``(5) Protective order.--The Copyright Royalty Judges may
issue such orders as may be appropriate to protect confidential
information, including orders excluding confidential information
from the record of the determination that is published or made
available to the public, except that any terms or rates of
royalty payments or distributions may not be excluded.
``(6) NOTE: Deadline. Federal
Register, publication. Publication of determination.--By no
later than the end of the 60-day period provided in section
802(f)(1)(D), the Librarian of Congress shall cause the
determination, and any corrections thereto, to be published in
the Federal Register. The Librarian of Congress shall also
publicize the determination and corrections in such other manner
as the Librarian considers appropriate, including, but not
limited to, publication on the Internet. NOTE: Records. The
Librarian of Congress shall also make the determination,
corrections, and the accompanying record available for public
inspection and copying.
``(7) Late payment.--A determination of Copyright Royalty
Judges may include terms with respect to late payment, but in no
way shall such terms prevent the copyright holder from asserting
other rights or remedies provided under this title.

``(d) Judicial Review.--
``(1) NOTE: Deadlines. Appeal.--Any determination of the
Copyright Royalty Judges under subsection (c) may, within 30
days after the publication of the determination in the Federal
Register, be appealed, to the United States Court of Appeals for
the District of Columbia Circuit, by any aggrieved participant
in the proceeding under subsection (b)(2) who fully participated
in the proceeding and who would be bound by the determination.

[[Page 2356]]
118 STAT. 2356

Any participant that did not participate in a rehearing may not
raise any issue that was the subject of that rehearing at any
stage of judicial review of the hearing determination. If no
appeal is brought within that 30-day period, the determination
of the Copyright Royalty Judges shall be final, and the royalty
fee or determination with respect to the distribution of fees,
as the case may be, shall take effect as set forth in paragraph
(2).
``(2) NOTE: Effective dates. Effect of rates.--
``(A) Expiration on specified date.--When this title
provides that the royalty rates and terms that were
previously in effect are to expire on a specified date,
any adjustment or determination by the Copyright Royalty
Judges of successor rates and terms for an ensuing
statutory license period shall be effective as of the
day following the date of expiration of the rates and
terms that were previously in effect, even if the
determination of the Copyright Royalty Judges is
rendered on a later date. A licensee shall be obligated
to continue making payments under the rates and terms
previously in effect until such time as rates and terms
for the successor period are established.
Whenever NOTE: Deadline. royalties pursuant to this
section are paid to a person other than the Copyright
Office, the entity designated by the Copyright Royalty
Judges to which such royalties are paid by the copyright
user (and any successor thereto) shall, within 60 days
after the final determination of the Copyright Royalty
Judges establishing rates and terms for a successor
period or the exhaustion of all rehearings or appeals of
such determination, if any, return any excess amounts
previously paid to the extent necessary to comply with
the final determination of royalty rates. Any
underpayment of royalties by a copyright user shall be
paid to the entity designated by the Copyright Royalty
Judges within the same period.
``(B) Other cases.--In cases where rates and terms
have not, prior to the inception of an activity, been
established for that particular activity under the
relevant license, such rates and terms shall be
retroactive to the inception of activity under the
relevant license covered by such rates and terms. In
other cases where rates and terms do not expire on a
specified date, successor rates and terms shall take
effect on the first day of the second month that begins
after the publication of the determination of the
Copyright Royalty Judges in the Federal Register, except
as otherwise provided in this title, or by the Copyright
Royalty Judges, or as agreed by the participants in a
proceeding that would be bound by the rates and terms.
Except as otherwise provided in this title, the rates
and terms, to the extent applicable, shall remain in
effect until such successor rates and terms become
effective.
``(C) Obligation to make payments.--
``(i) The pendency of an appeal under this
subsection shall not relieve persons obligated to
make royalty payments under section 111, 112, 114,
115, 116, 118, 119, or 1003, who would be affected
by the determination on appeal, from--

[[Page 2357]]
118 STAT. 2357

``(I) providing the statements of
account and any report of use; and
``(II) paying the royalties required
under the relevant determination or
regulations.
``(ii) NOTE: Deadline. Notwithstanding clause
(i), whenever royalties described in clause (i) are paid
to a person other than the Copyright Office, the entity
designated by the Copyright Royalty Judges to which such
royalties are paid by the copyright user (and any
successor thereto) shall, within 60 days after the final
resolution of the appeal, return any excess amounts
previously paid (and interest thereon, if ordered
pursuant to paragraph (3)) to the extent necessary to
comply with the final determination of royalty rates on
appeal. Any underpayment of royalties resulting from an
appeal (and interest thereon, if ordered pursuant to
paragraph (3)) shall be paid within the same period.
``(3) Jurisdiction of court.--If the court, pursuant to
section 706 of title 5, modifies or vacates a determination of
the Copyright Royalty Judges, the court may enter its own
determination with respect to the amount or distribution of
royalty fees and costs, and order the repayment of any excess
fees, the payment of any underpaid fees, and the payment of
interest pertaining respectively thereto, in accordance with its
final judgment. The court may also vacate the determination of
the Copyright Royalty Judges and remand the case to the
Copyright Royalty Judges for further proceedings in accordance
with subsection (a).

``(e) Administrative Matters.--
``(1) Deduction of costs of library of congress and
copyright office from filing fees.--
``(A) Deduction from filing fees.--The Librarian of
Congress may, to the extent not otherwise provided under
this title, deduct from the filing fees collected under
subsection (b) for a particular proceeding under this
chapter the reasonable costs incurred by the Librarian
of Congress, the Copyright Office, and the Copyright
Royalty Judges in conducting that proceeding, other than
the salaries of the Copyright Royalty Judges and the 3
staff members appointed under section 802(b).
``(B) Authorization of appropriations.--There are
authorized to be appropriated such sums as may be
necessary to pay the costs incurred under this chapter
not covered by the filing fees collected under
subsection (b). All funds made available pursuant to
this subparagraph shall remain available until expended.
``(2) Positions required for administration of compulsory
licensing.--Section 307 of the Legislative Branch Appropriations
Act, 1994, shall not apply to employee positions in the Library
of Congress that are required to be filled in order to carry out
section 111, 112, 114, 115, 116, 118, or 119 or chapter 10.

``Sec. 804. Institution of proceedings

``(a) NOTE: Notices. Federal Register, publication. 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

[[Page 2358]]
118 STAT. 2358

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 2005 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 2005, and each fifth calendar year
thereafter, in accordance with the provisions in section
801(b)(3) (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 is the rules and regulations of the Federal
Communications Commission shall set forth the change on which
the petition is based.
``(C) NOTE: Effective date. 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) NOTE: Effective date. 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

[[Page 2359]]
118 STAT. 2359

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) NOTE: Effective dates. Termination date. 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
effective date 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) NOTE: Effective dates. Termination
dates. 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.
``(C)(i) Notwithstanding any other provision of this
chapter, this subparagraph shall govern proceedings
commenced pursuant to section 114(f)(1)(C) and
114(f)(2)(C) concerning new types of services.
``(ii) NOTE: Deadline. Notice. Not later than 30
days after a petition to determine rates and terms for a
new type of service that 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 such subsections (b), (c), and (d) of section
803, except that--
``(I) NOTE: Deadline. the determination
shall be issued by not later than 24 months after
the publication of the notice under clause (ii);
and
``(II) NOTE: Effective date. the decision
shall take effect as provided in subsections
(c)(2) and (d)(2) of section 803 and section
114(f)(4)(B)(ii) and (C).
``(iv) The rates and terms shall remain in effect
for the period set forth in section 114(f)(1)(C) or
114(f)(2)(C), as the case may be.

[[Page 2360]]
118 STAT. 2360

``(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) NOTE: Deadline. 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) NOTE: Deadline. 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) NOTE: Federal
Register, publication. Notice. 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.

``Sec. 805. General rule for voluntarily negotiated agreements

``Any rates or terms under this title that--
``(1) are agreed to by participants to a proceeding under
section 803(b)(3),
``(2) are adopted by the Copyright Royalty Judges as part of
a determination under this chapter, and

[[Page 2361]]
118 STAT. 2361

``(3) are in effect for a period shorter than would
otherwise apply under a determination pursuant to this chapter,

shall remain in effect for such period of time as would otherwise apply
under such determination, except that the Copyright Royalty Judges shall
adjust the rates pursuant to the voluntary negotiations to reflect
national monetary inflation during the additional period the rates
remain in effect.''.
(b) Conforming Amendment.--The table of chapters for title 17,
United States Code, is amended by striking the item relating to chapter
8 and inserting the following:

``8. Proceedings by Copyright Royalty Judges......................801''.

SEC. 4. DEFINITION.

Section 101 is amended by inserting after the definition of
``copies'' the following:
``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.''.

SEC. 5. TECHNICAL AMENDMENTS.

(a) Cable Rates.--Section 111(d) is amended--
(1) in paragraph (2), in the second sentence, by striking
``a copyright arbitration royalty panel'' and inserting ``the
Copyright Royalty Judges.''; and
(2) in paragraph (4)--
(A) in subparagraph (A), by striking ``Librarian of
Congress'' each place it appears and inserting
``Copyright Royalty Judges'';
(B) in subparagraph (B)--
(i) in the first sentence, by striking
``Librarian of Congress shall, upon the
recommendation of the Register of Copyrights,''
and inserting ``Copyright Royalty Judges shall'';
(ii) in the second sentence, by striking
``Librarian determines'' and inserting ``Copyright
Royalty Judges determine''; and
(iii) in the third sentence--
(I) by striking ``Librarian'' each
place it appears and inserting
``Copyright Royalty Judges''; and
(II) by striking ``convene a
copyright arbitration royalty panel''
and inserting ``conduct a proceeding'';
and
(C) in subparagraph (C), by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Judges''.

(b) Ephemeral Recordings.--Section 112(e) is amended--
(1) in paragraph (3)--
(A) by amending the first sentence to read as
follows: ``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.'';
(B) in the third sentence, by striking ``Librarian
of Congress'' and inserting ``Copyright Royalty
Judges''; and

[[Page 2362]]
118 STAT. 2362

(C) in the fourth sentence, by striking
``negotiation'';
(2) in paragraph (4)--
(A) by amending the first sentence to read as
follows: ``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.'';
(B) by striking ``copyright arbitration royalty
panel'' each subsequent place it appears and inserting
``Copyright Royalty Judges'';
(C) in the fourth sentence, by striking ``its
decision'' and inserting ``their decision'';
(D) in the fifth sentence, by striking ``negotiated
as provided'' and inserting ``described''; and
(E) in the last sentence, by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Judges'';
(3) in paragraph (5), by striking ``determination by a
copyright arbitration royalty panel or decision by the Librarian
of Congress'' and inserting ``decision by the Librarian of
Congress or determination by the Copyright Royalty Judges'';
(4) by striking paragraph (6) and redesignating paragraphs
(7), (8), and (9), as paragraphs (6), (7), and (8),
respectively; and
(5) in paragraph (6)(A), as so redesignated, by striking
``Librarian of Congress'' and inserting ``Copyright Royalty
Judges''.

(c) Scope of Exclusive Rights in Sound Recordings.--Section 114(f)
is amended--
(1) in paragraph (1)--
(A) in subparagraph (A)--
(i) by amending the first sentence to read as
follows: ``Proceedings under chapter 8 shall
determine reasonable rates and terms of royalty
payments for subscription transmissions by
preexisting subscription services and
transmissions by preexisting satellite digital
audio radio services specified by 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, except
where a different transitional period is provided
under section 6(b)(3) of the Copyright Royalty and
Distribution Reform Act of 2004 or such other
period.'';
(ii) in the third sentence, by striking
``Librarian of Congress'' and inserting
``Copyright Royalty Judges''; and
(iii) in the fourth sentence, by striking
``negotiation'';
(B) in subparagraph (B)--
(i) by amending the first sentence to read as
follows: ``The schedule of reasonable rates and
terms determined by the Copyright Royalty Judges
shall, subject to paragraph (3), be binding on all
copyright owners of sound recordings and entities
performing sound recordings affected by this
paragraph during

[[Page 2363]]
118 STAT. 2363

the 5-year period specified in subparagraph (A), a
transitional period provided under section 6(b)(3)
of the Copyright Royalty and Distribution Reform
Act of 2004, or such other period as the parties
may agree.'';
(ii) in the second sentence, by striking
``copyright arbitration royalty panel'' and
inserting ``Copyright Royalty Judges''; and
(iii) in the second sentence, by striking
``negotiated as provided'' and inserting
``described''; and
(C) by amending subparagraph (C) to read as follows:
``(C) The procedures under subparagraphs (A) and (B) also
shall be initiated pursuant to a petition filed by any copyright
owners of sound recordings, any preexisting subscription
services, or any preexisting satellite digital audio radio
services indicating that a new type of subscription digital
audio transmission 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 transmission 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
subscription digital audio transmission services most recently
determined under subparagraph (A) or (B) and chapter 8 expire,
or such other period as the parties may agree.'';
(2) in paragraph (2)--
(A) in subparagraph (A)--
(i) by amending the first paragraph to read as
follows: ``Proceedings under chapter 8 shall
determine reasonable rates and terms of royalty
payments for subscription transmissions by
eligible nonsubscription transmission services and
transmissions by new subscription services
specified by 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, except where a different
transitional period is provided under section
6(b)(3) of the Copyright Royalty and Distribution
Reform Act of 2004, or such other period as the
parties may agree.'';
(ii) in the third sentence, by striking
``Librarian of Congress'' and inserting
``Copyright Royalty Judges''; and
(iii) in the fourth sentence, by striking
``negotiation'';
(B) in subparagraph (B)--
(i) by amending the first sentence to read as
follows: ``The schedule of reasonable rates and
terms determined by the Copyright Royalty Judges
shall, subject to paragraph (3), 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), a transitional period provided
under section 6(b)(3) of the Copyright Royalty and
Distribution Act of 2004, or such other period as
the parties may agree.'';
(ii) by striking ``copyright arbitration
royalty panel'' each subsequent place it appears
and inserting ``Copyright Royalty Judges''; and

[[Page 2364]]
118 STAT. 2364

(iii) in the last sentence by striking
``negotiated as provided'' and inserting
``described in''; and
(C) by amending subparagraph (C) to read as follows:
``(C) The procedures under subparagraphs (A) and (B) shall
also be initiated pursuant to a petition filed by any copyright
owners of sound recordings or any eligible nonsubscription
service or new subscription service indicating that a new type
of eligible nonsubscription service or new subscription 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 preexisting subscription digital audio
transmission services or preexisting satellite digital radio
audio 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.'';
(3) in paragraph (3), by striking ``determination by a
copyright arbitration royalty panel or decision by the Librarian
of Congress'' and inserting ``decision by the Librarian of
Congress or determination by the Copyright Royalty Judges''; and
(4) in paragraph (4)--
(A) by striking ``Librarian of Congress'' each place
it appears and inserting ``Copyright Royalty Judges'';
and
(B) by adding after the first sentence of
subparagraph (A) the following: ``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.''.

(d) Phonorecords of Nondramatic Musical Works.--Section 115(c)(3) is
amended--
(1) in subparagraph (A)(ii), by striking ``(F)'' and
inserting ``(E)'';
(2) in subparagraph (B)--
(A) by striking ``under this paragraph'' and
inserting ``under this section'';
(B) by inserting ``on a nonexclusive basis'' after
``common agents''; and
(C) by striking ``subparagraphs (C) through (F)''
and inserting ``this subparagraph and subparagraphs (C)
through (E)''; and
(3) in subparagraph (C)--
(A) by amending the first sentence to read as
follows: ``Proceedings under chapter 8 shall determine
reasonable rates and terms of royalty payments for the
activities specified by this section during the period
beginning with the effective date of such rates and
terms, but not earlier than January 1 of the second year
following the year in

[[Page 2365]]
118 STAT. 2365

which the petition requesting the proceeding is filed,
and ending on the effective date of successor rates and
terms, or such other period as the parties may agree.'';
(B) in the third sentence, by striking ``Librarian
of Congress'' and inserting ``Copyright Royalty
Judges''; and
(C) in the fourth sentence, by striking
``negotiation'';
(4) in subparagraph (D)--
(A) by amending the first sentence to read as
follows: ``The schedule of reasonable rates and terms
determined by the Copyright Royalty Judges shall,
subject to subparagraph (E), be binding on all copyright
owners of nondramatic musical works and persons entitled
to obtain a compulsory license under subsection (a)(1)
during the period specified in subparagraph (C), such
other period as may be determined pursuant to
subparagraphs (B) and (C), or such other period as the
parties may agree.'';
(B) in the third sentence, by striking ``copyright
arbitration royalty panel'' and inserting ``Copyright
Royalty Judges'';
(C) in the third sentence, by striking ``negotiated
as provided in subparagraphs (B) and (C)'' and inserting
``described''; and
(D) in the last sentence, by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Judges''.
(5) in subparagraph (E)--
(A) in clause (i)--
(i) in the first sentence, by striking
``Librarian of Congress'' and inserting
``Librarian of Congress and Copyright Royalty
Judges''; and
(ii) in the second sentence, by striking
``(C), (D) or (F) shall be given effect'' and
inserting ``(C) or (D) shall be given effect as to
digital phonorecord deliveries''; and
(B) in clause (ii)(I), by striking ``(C), (D) or
(F)'' each place it appears and inserting ``(C) or
(D)''; and
(6) by striking subparagraph (F) and redesignating
subparagraphs (G) through (L) as subparagraphs (F) through (K),
respectively.

(e) Coin-Operated Phonorecord Players.--Section 116 is amended--
(1) in subsection (b), by amending paragraph (2) to read as
follows:
``(2) Chapter 8 proceeding.--Parties not subject to such a
negotiation may have the terms and rates and the division of
fees described in paragraph (1) determined in a proceeding in
accordance with the provisions of chapter 8.''; and
(2) in subsection (c)--
(A) in the subsection heading, by striking
``Copyright Arbitration Royalty Panel Determinations''
and inserting ``Determinations by Copyright Royalty
Judges''; and
(B) by striking ``a copyright arbitration royalty
panel'' and inserting ``the Copyright Royalty Judges''.

(f) Use of Certain Works in Connection With Noncommercial
Broadcasting.--Section 118 is amended--
(1) in subsection (b)--
(A) in paragraph (1)--

[[Page 2366]]
118 STAT. 2366

(i) in the first sentence, by striking
``Librarian of Congress'' and inserting
``Copyright Royalty Judges''; and
(ii) by striking the second and third
sentences;
(B) NOTE: Deadline. in paragraph (2), by
striking ``Librarian of Congress:'' and all that follows
through the end of the sentence and inserting
``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.''; and
(C) in paragraph (3)--
(i) in the second sentence--
(I) by striking ``copyright
arbitration royalty panel'' and
inserting ``Copyright Royalty Judges'';
and
(II) by striking ``paragraph (2).''
and inserting ``paragraph (2) or (3).'';
(ii) in the last sentence, by striking
```Librarian of Congress'' and inserting
``Copyright Royalty Judges''; and
(iii) by striking ``(3) In'' and all that
follows through the end of the first sentence and
inserting the following:
``(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 copyright owners 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) NOTE: Federal Register, publication. 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.'';
(2) by striking subsection (c) and redesignating subsections
(d) through (g) as subsections (c) through (f), respectively;
(3) in subsection (c), as so redesignated, in the matter
preceding paragraph (1)--
(A) by striking ``(b)(2)'' and inserting ``(b)(2) or
(3)'';
(B) by striking ``(b)(3)'' and inserting ``(b)(4)'';
and
(C) by striking ``a copyright arbitration royalty
panel under subsection (b)(3)'' and inserting ``the
Copyright Royalty Judges under subsection (b)(3), to the
extent that they were accepted by the Librarian of
Congress'';
(4) in subsection (d), as so redesignated--
(A) by striking ``in the Copyright Office'' and
inserting ``with the Copyright Royalty Judges''; and
(B) by striking ``Register of Copyrights shall
prescribe'' and inserting ``Copyright Royalty Judges
shall prescribe as provided in section 803(b)(6)''; and

[[Page 2367]]
118 STAT. 2367

(5) in subsection (f), as so redesignated, by striking
``(d)'' and inserting ``(c)''.

(g) Secondary Transmissions by Satellite Carriers.--Section 119(b)
is amended--
(1) in paragraph (3), by striking ``Librarian of Congress''
and inserting ``Copyright Royalty Judges''; and
(2) in paragraph (4)--
(A) in subparagraph (A), by striking ``Librarian of
Congress'' each place it appears and inserting
``Copyright Royalty Judges''; and
(B) by amending subparagraphs (B) and (C) to read as
follows:
``(B) Determination of controversy; distributions.--
After the first day of August of each year, the
Copyright Royalty Judges shall determine whether there
exists a controversy concerning the distribution of
royalty fees. If the Copyright Royalty Judges determine
that no such controversy exists, the Librarian of
Congress shall, after deducting reasonable
administrative costs under this paragraph, distribute
such fees to the copyright owners entitled to receive
them, or to their designated agents. If the Copyright
Royalty Judges find the existence of a controversy, the
Copyright Royalty Judges shall, pursuant to chapter 8 of
this title, conduct a proceeding to determine the
distribution of royalty fees.
``(C) Withholding of fees during controversy.--
During the pendency of any proceeding under this
subsection, the Copyright Royalty Judges shall withhold
from distribution an amount sufficient to satisfy all
claims with respect to which a controversy exists, but
shall have the discretion to proceed to distribute any
amounts that are not in controversy.''.

(h) Ratemaking for Satellite Carriers.--Section 119(c) of title 17,
United States Code, is amended--
(1) in paragraph (2)--
(A) in subparagraph (B), by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Judges'';
and
(B) in subparagraph (C), by striking ``Register of
Copyrights shall prescribe'' and inserting ``Copyright
Royalty Judges shall prescribe as provided in section
803(b)(6); and
(2) in paragraph (3)--
(A) in subparagraph (A)--
(i) by striking ``arbitration proceedings''
and inserting ``proceedings''; and
(ii) by striking ``arbitration proceeding''
and inserting ``proceedings'';
(B) in subparagraph (B)--
(i) by striking ``copyright arbitration
royalty panel appointed under chapter 8'' and
inserting ``Copyright Royalty Judges''; and
(ii) by striking ``panel shall base its
decision'' and inserting ``Copyright Royalty
Judges shall base their determination''; and
(C) in subparagraph (C)--

[[Page 2368]]
118 STAT. 2368

(i) in the heading, by striking ``decision of
arbitration panel or order of librarian'' and
inserting ``determination under chapter 8''; and
(ii) by striking clauses (i) and (ii) and
inserting the following:
``(i) is made by the Copyright Royalty Judges
pursuant to this paragraph and becomes final, or
``(ii) is made by the court on appeal under
section 803(d)(3),''.

(i) Digital Audio Recording Devices.--
(1) Royalty payments.--Section 1004(a)(3) is amended by
striking ``Librarian of Congress'' each place it appears and
inserting ``Copyright Royalty Judges''.
(2) Entitlement to royalty payments.--Section 1006(c) is
amended by striking ``Librarian of Congress shall convene a
copyright arbitration royalty panel which'' and inserting
``Copyright Royalty Judges''.
(3) Procedures for distributing royalty payments.--Section
1007 is amended--
(A) in subsection (a), by amending paragraph (1) to
read as follows:
``(1) NOTE: Regulations. Filing of claims.--During the
first 2 months of each calendar year, every interested copyright
party seeking to receive royalty payments to which such party is
entitled under section 1006 shall file with the Copyright
Royalty Judges a claim for payments collected during the
preceding year in such form and manner as the Copyright Royalty
Judges shall prescribe by regulation.''; and
(B) by amending subsections (b) and (c) to read as
follows:

``(b) Distribution of Payments in the Absence of a Dispute.--After
the period established for the filing of claims under subsection (a), in
each year, the Copyright Royalty Judges shall determine whether there
exists a controversy concerning the distribution of royalty payments
under section 1006(c). NOTE: Deadline. If the Copyright Royalty
Judges determine that no such controversy exists, the Librarian of
Congress shall, within 30 days after such determination, authorize the
distribution of the royalty payments as set forth in the agreements
regarding the distribution of royalty payments entered into pursuant to
subsection (a). The Librarian of Congress shall, before such royalty
payments are distributed, deduct the reasonable administrative costs
incurred by the Librarian under this section.

``(c) Resolution of Disputes.--If the Copyright Royalty Judges find
the existence of a controversy, the Copyright Royalty Judges shall,
pursuant to chapter 8 of this title, conduct a proceeding to determine
the distribution of royalty payments. During the pendency of such a
proceeding, the Copyright Royalty Judges shall withhold from
distribution an amount sufficient to satisfy all claims with respect to
which a controversy exists, but shall, to the extent feasible, authorize
the distribution of any amounts that are not in controversy. The
Librarian of Congress shall, before such royalty payments are
distributed, deduct the reasonable administrative costs incurred by the
Librarian under this section.''.
(4) Determination of certain disputes.--(A) Section 1010 is
amended to read as follows:

[[Page 2369]]
118 STAT. 2369

``Sec. 1010. Determination of certain disputes

``(a) Scope of Determination.--Before the date of first distribution
in the United States of a digital audio recording device or a digital
audio interface device, any party manufacturing, importing, or
distributing such device, and any interested copyright party may
mutually agree to petition the Copyright Royalty Judges to determine
whether such device is subject to section 1002, or the basis on which
royalty payments for such device are to be made under section 1003.
``(b) Initiation of Proceedings.--The parties under subsection (a)
shall file the petition with the Copyright Royalty Judges requesting the
commencement of a proceeding. NOTE: Deadline. Notice. Federal
Register, publication. Within 2 weeks after receiving such a petition,
the Chief Copyright Royalty Judge shall cause notice to be published in
the Federal Register of the initiation of the proceeding.

``(c) Stay of Judicial Proceedings.--Any civil action brought under
section 1009 against a party to a proceeding under this section shall,
on application of one of the parties to the proceeding, be stayed until
completion of the proceeding.
``(d) Proceeding.--The Copyright Royalty Judges shall conduct a
proceeding with respect to the matter concerned, in accordance with such
procedures as the Copyright Royalty Judges may adopt. The Copyright
Royalty Judges shall act on the basis of a fully documented written
record. Any party to the proceeding may submit relevant information and
proposals to the Copyright Royalty Judges. The parties to the proceeding
shall each bear their respective costs of participation.
``(e) Judicial Review.--Any determination of the Copyright Royalty
Judges under subsection (d) may be appealed, by a party to the
proceeding, in accordance with section 803(d) of this title. The
pendency of an appeal under this subsection shall not stay the
determination of the Copyright Royalty Judges. If the court modifies the
determination of the Copyright Royalty Judges, the court shall have
jurisdiction to enter its own decision in accordance with its final
judgment. The court may further vacate the determination of the
Copyright Royalty Judges and remand the case for proceedings as provided
in this section.''.
(B) The item relating to section 1010 in the table of
sections for chapter 10 is amended to read as follows:

``1010. Determination of certain disputes.''.

SEC. 6. EFFECTIVE DATE AND TRANSITION PROVISIONS. NOTE: 17 USC 801
note.

(a) Effective Date.--This Act and the amendments made by this Act
shall take effect 6 months after the date of enactment of this Act,
except that the Librarian of Congress shall appoint 1 or more interim
Copyright Royalty Judges under section 802(d) of title 17, United States
Code, as amended by this Act, within 90 days after such date of
enactment to carry out the functions of the Copyright Royalty Judges
under title 17, United States Code, to the extent that Copyright Royalty
Judges provided for in section 801(a) of title 17, United States Code,
as amended by this Act, have not been appointed before the end of that
90-day period.
(b) Transition Provisions.--
(1) In general.--Subject to paragraphs (2) and (3), the
amendments made by this Act shall not affect any proceedings
commenced, petitions filed, or voluntary agreements entered

[[Page 2370]]
118 STAT. 2370

into before the effective date provided in subsection (a) under
the provisions of title 17, United States Code, as amended by
this Act, and pending on such effective date. Such proceedings
shall continue, determinations made in such proceedings, and
appeals taken therefrom, as if this Act had not been enacted,
and shall continue in effect until modified under title 17,
United States Code, as amended by this Act. Such petitions filed
and voluntary agreements entered into shall remain in effect as
if this Act had not been enacted. For purposes of this
paragraph, the Librarian of Congress may determine whether a
proceeding has commenced. The Librarian of Congress may
terminate any proceeding commenced before the date of enactment
of this Act pursuant to chapter 8 of title 17, United States
Code, and any proceeding so terminated shall become null and
void. In such cases, the Copyright Royalty Judges may initiate a
new proceeding in accordance with regulations adopted pursuant
to section 803(b)(6) of title 17, United States Code.
(2) Certain royalty rate proceedings.--Notwithstanding
paragraph (1), the amendments made by this Act shall not affect
proceedings to determine royalty rates pursuant to section
119(c) of title 17, United States Code, that are commenced
before January 31, 2006.
(3) NOTE: Termination date. Pending proceedings.--
Notwithstanding paragraph (1), any proceedings to establish or
adjust rates and terms for the statutory licenses under section
114(f)(2) or 112(e) of title 17, United States Code, for a
statutory period commencing on or after January 1, 2005, shall
be terminated upon the date of enactment of this Act and shall
be null and void. The rates and terms in effect under section
114(f)(2) or 112(e) of title 17, United States Code, on December
31, 2004, for new subscription services, eligible
nonsubscription services, and services exempt under section
114(d)(1)(C)(iv) of such title, and the rates and terms
published in the Federal Register under the authority of the
Small Webcaster Settlement Act of 2002 (17 U.S.C. 114 note;
Public Law 107-321) (including the amendments made by that Act)
for the years 2003 through 2004, as well as any notice and
recordkeeping provisions adopted pursuant thereto, shall remain
in effect until the later of the first applicable effective date
for successor terms and rates specified in section 804(b) (2) or
(3)(A) of title 17, United States Code, or such later date as
the parties may agree or the Copyright Royalty Judges may
establish. For the period commencing January 1, 2005, an
eligible small webcaster or a noncommercial webcaster, as
defined in the regulations published by the Register of
Copyrights pursuant to the Small Webcaster Settlement Act of
2002 (17 U.S.C. 114 note; Public Law 107-321) (including the
amendments made by that Act), may elect to be subject to the
rates and terms published in those regulations by complying with
the procedures governing the election process set forth in those
regulations not later than the first date on which the webcaster
would be obligated to make a royalty payment for such period.
Until successor terms and rates have been established for the
period commencing January 1, 2006, licensees shall continue to
make royalty payments at the rates and on the terms previously

[[Page 2371]]
118 STAT. 2371

in effect, subject to retroactive adjustment when successor
rates and terms for such services are established.
(4) NOTE: Publication. Notice. Interim proceedings.--
Notwithstanding subsection (a), as soon as practicable after the
date of enactment of this Act, the Copyright Royalty Judges or
interim Copyright Royalty Judges shall publish the notice
described in section 803(b)(1)(A) of title 17, United States
Code, as amended by this Act, to initiate a proceeding to
establish or adjust rates and terms for the statutory licenses
under section 114(f)(2) or 112(e) of title 17, United States
Code, for new subscription services and eligible nonsubscription
services for the period commencing January 1, 2006. The
Copyright Royalty Judges or Interim Copyright Royalty Judges are
authorized to cause that proceeding to take place as provided in
subsection (b) of section 803 of that title within the time
periods set forth in that subsection. Notwithstanding section
803(c)(1) of that title, the Copyright Royalty Judges shall not
be required to issue their determination in that proceeding
before the expiration of the statutory rates and terms in effect
on December 31, 2004.

(c) Existing Appropriations.--Any funds made available in an
appropriations Act to carry out chapter 8 of title 17, United States
Code, shall be available to the extent necessary to carry out this
section.

Approved November 30, 2004.

LEGISLATIVE HISTORY--H.R. 1417:
---------------------------------------------------------------------------

HOUSE REPORTS: No. 108-408 (Comm. on the Judiciary).
CONGRESSIONAL RECORD, Vol. 150 (2004):
Mar. 3, considered and passed House.
Oct. 6, considered and passed Senate, amended.
Nov. 17, House concurred in Senate amendment.