Home > 108th Congressional Bills > H.R. 1417 (enr) To amend title 17, United States Code, to replace copyright arbitration royalty panels with Copyright Royalty Judges, and for other purposes. [Enrolled bill] ...H.R. 1417 (enr) To amend title 17, United States Code, to replace copyright arbitration royalty panels with Copyright Royalty Judges, and for other purposes. [Enrolled bill] ...
108th CONGRESS
2d Session
H. R. 1417
_______________________________________________________________________
AN ACT
To amend title 17, United States Code, to replace copyright arbitration
royalty panels with Copyright Royalty Judges, and for other purposes.
108th CONGRESS
2d Session
H. R. 1417
_______________________________________________________________________
AN ACT
To amend title 17, United States Code, to replace copyright arbitration
royalty panels with Copyright Royalty Judges, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``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 one of the three as
the Chief Copyright Royalty Judge. In making such appointments, the
Librarian shall consult 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.
``(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 8, 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
insure 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--
``(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 shall 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); and
``(iii) file the agreement with the Copyright
Royalty Judges.
``(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 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
section 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 the 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
the other participants in the proceeding under section
803(b)(2) that would be bound by the terms, rates,
distribution, or other determination set by the
agreement an opportunity to comment on the agreement
and object to its adoption as the basis for statutory
terms and rates or as a basis for the distribution of
statutory royalty payments, as the case may be; and
``(ii) the Copyright Royalty Judges may decline to
adopt the agreement as the basis for statutory terms
and rates or as the basis for the distribution of
statutory royalty payments, as the case may be, if any
other participant described in subparagraph (A) objects
to the agreement and the Copyright Royalty Judges find,
based on the record before them, that the agreement is
not likely to meet the statutory standard for setting
the terms and rates, or for distributing the royalty
payments, as the case may be.
``(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) 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. The Copyright Royalty Judges may consult with
the Register of Copyrights in making any rulings under section
802(f)(1).
``(d) Administrative Support.--The Librarian of Congress shall
provide the Copyright Royalty Judges with the necessary administrative
services related to proceedings under this chapter.
``(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.--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 two Copyright Royalty Judges, one 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). In this subsection, `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 terms of the Copyright Royalty Judges shall each
be 6 years, except of the individuals first appointed, the Chief
Copyright Royalty Judge shall be appointed to a term of 6 years, and of
the remaining Copyright Royalty Judges, one shall be appointed to a
term of 2 years, and the other shall be appointed to a term of 4 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
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