II 

Calendar No. 744

108TH CONGRESS 

2D SESSION H.R. 1417 

IN THE SENATE OF THE UNITED STATES 

MARCH 4, 2004

Received; read twice and referred to the Committee on the Judiciary 

SEPTEMBER 29, 2004

Reported by Mr. HATCH, with an amendment 

[Strike out all after the enacting clause and insert the part printed in italic] 

A BILL

To amend title 17, United States Code, to replace copyright 

arbitration royalty panels with Copyright Royalty 

Judges, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Copyright Royalty and 

5 Distribution Reform Act of 2004’’. 

6 SEC. 2. REFERENCE. 

7 Except as otherwise expressly provided, whenever in 

8 this Act an amendment or repeal is expressed in terms 
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1 of an amendment to, or repeal of, a section or other provi2 sion, the reference shall be considered to be made to a 

3 section or other provision of title 17, United States Code. 

4 SEC. 3. COPYRIGHT ROYALTY JUDGE AND STAFF. 

5 (a) IN GENERAL.—Chapter 8 is amended to read as 

6 follows: 

7 ‘‘CHAPTER 8—PROCEEDINGS BY 

8 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.

9 ‘‘§ 801. Copyright Royalty Judges; appointment and 

10 functions 

11 ‘‘(a) APPOINTMENT.—The Librarian of Congress 

12 shall appoint 3 full-time Copyright Royalty Judges, and 

13 shall appoint one of the three as the Chief Copyright Roy14 alty Judge. In making such appointments, the Librarian 

15 shall consult with the Register of Copyrights. 

16 ‘‘(b) FUNCTIONS.—Subject to the provisions of this 

17 chapter, the functions of the Copyright Royalty Judges 

18 shall be as follows: 

19 ‘‘(1) To make determinations and adjustments 

20 of reasonable terms and rates of royalty payments as 

21 provided in sections 112(e), 114, 115, 116, 118, 119 

22 and 1004. The rates applicable under sections 
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1 114(f)(1)(B), 115, and 116 shall be calculated to 

2 achieve the following objectives: 

3 ‘‘(A) To maximize the availability of cre4 ative works to the public. 

5 ‘‘(B) To afford the copyright owner a fair 

6 return for his or her creative work and the 

7 copyright user a fair income under existing eco8 nomic conditions. 

9 ‘‘(C) To reflect the relative roles of the 

10 copyright owner and the copyright user in the 

11 product made available to the public with re12 spect to relative creative contribution, techno13 logical contribution, capital investment, cost, 

14 risk, and contribution to the opening of new 

15 markets for creative expression and media for 

16 their communication. 

17 ‘‘(D) To minimize any disruptive impact 

18 on the structure of the industries involved and 

19 on generally prevailing industry practices. 

20 ‘‘(2) To make determinations concerning the 

21 adjustment of the copyright royalty rates under sec22 tion 111 solely in accordance with the following pro23 visions: 

24 ‘‘(A) The rates established by section 

25 111(d)(1)(B) may be adjusted to reflect—
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1 ‘‘(i) national monetary inflation or de2 flation; or 

3 ‘‘(ii) changes in the average rates 

4 charged cable subscribers for the basic 

5 service of providing secondary trans6 missions to maintain the real constant dol7 lar level of the royalty fee per subscriber 

8 which existed as of the date of October 19, 

9 1976, 

10 except that—

11 ‘‘(I) if the average rates charged cable 

12 system subscribers for the basic service of 

13 providing secondary transmissions are 

14 changed so that the average rates exceed 

15 national monetary inflation, no change in 

16 the rates established by section 

17 111(d)(1)(B) shall be permitted; and

18 ‘‘(II) no increase in the royalty fee 

19 shall be permitted based on any reduction 

20 in the average number of distant signal 

21 equivalents per subscriber. 

22 The Copyright Royalty Judges may consider all 

23 factors relating to the maintenance of such level 

24 of payments, including, as an extenuating fac25 tor, whether the industry has been restrained 
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1 by subscriber rate regulating authorities from 

2 increasing the rates for the basic service of pro3 viding secondary transmissions. 

4 ‘‘(B) In the event that the rules and regu5 lations of the Federal Communications Com6 mission are amended at any time after April 8, 

7 1976, to permit the carriage by cable systems 

8 of additional television broadcast signals beyond 

9 the local service area of the primary transmit10 ters of such signals, the royalty rates estab11 lished by section 111(d)(1)(B) may be adjusted 

12 to insure that the rates for the additional dis13 tant signal equivalents resulting from such car14 riage are reasonable in the light of the changes 

15 effected by the amendment to such rules and 

16 regulations. In determining the reasonableness 

17 of rates proposed following an amendment of 

18 Federal Communications Commission rules and 

19 regulations, the Copyright Royalty Judges shall 

20 consider, among other factors, the economic im21 pact on copyright owners and users; except that 

22 no adjustment in royalty rates shall be made 

23 under this subparagraph with respect to any 

24 distant signal equivalent or fraction thereof rep25 resented by—
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1 ‘‘(i) carriage of any signal permitted 

2 under the rules and regulations of the Fed3 eral Communications Commission in effect 

4 on April 15, 1976, or the carriage of a sig5 nal of the same type (that is, independent, 

6 network, or noncommercial educational) 

7 substituted for such permitted signal; or 

8 ‘‘(ii) a television broadcast signal first 

9 carried after April 15, 1976, pursuant to 

10 an individual waiver of the rules and regu11 lations of the Federal Communications 

12 Commission, as such rules and regulations 

13 were in effect on April 15, 1976. 

14 ‘‘(C) In the event of any change in the 

15 rules and regulations of the Federal Commu16 nications Commission with respect to syn17 dicated and sports program exclusivity after 

18 April 15, 1976, the rates established by section 

19 111(d)(1)(B) may be adjusted to assure that 

20 such rates are reasonable in light of the 

21 changes to such rules and regulations, but any 

22 such adjustment shall apply only to the affected 

23 television broadcast signals carried on those 

24 systems affected by the change. 
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1 ‘‘(D) The gross receipts limitations estab2 lished by section 111(d)(1)(C) and (D) shall be 

3 adjusted to reflect national monetary inflation 

4 or deflation or changes in the average rates 

5 charged cable system subscribers for the basic 

6 service of providing secondary transmissions to 

7 maintain the real constant dollar value of the 

8 exemption provided by such section, and the 

9 royalty rate specified therein shall not be sub10 ject to adjustment. 

11 ‘‘(3)(A) To authorize the distribution, under 

12 sections 111, 119, and 1007, of those royalty fees 

13 collected under sections 111, 119, and 1005, as the 

14 case may be, to the extent that the Copyright Roy15 alty Judges have found that the distribution of such 

16 fees is not subject to controversy. 

17 ‘‘(B) In cases where the Copyright Royalty 

18 Judges determine that controversy exists, the Copy19 right Royalty Judges shall determine the distribu20 tion of such fees, including partial distributions, in 

21 accordance with section 111, 119, or 1007, as the 

22 case may be. 

23 ‘‘(C) the Copyright Royalty Judges shall make 

24 a partial distribution of such fees during the pend25 ency of the proceeding under subparagraph (B) if all 
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1 participants under section 803(b)(2) in the pro2 ceeding that are entitled to receive those fees that 

3 are to be partially distributed—

4 ‘‘(i) agree to such partial distribution; 

5 ‘‘(ii) sign an agreement obligating them to 

6 return any excess amounts to the extent nec7 essary to comply with the final determination 

8 on the distribution of the fees made under sub9 paragraph (B); and 

10 ‘‘(iii) file the agreement with the Copyright 

11 Royalty Judges. 

12 ‘‘(D) The Copyright Royalty Judges and any 

13 other officer or employee acting in good faith in dis14 tributing funds under subparagraph (C) shall not be 

15 held liable for the payment of any excess fees under 

16 subparagraph (C). The Copyright Royalty Judges 

17 shall, at the time the final determination is made, 

18 calculate any such excess amounts. 

19 ‘‘(4) To accept or reject royalty claims filed 

20 under section 111, 119, and 1007, on the basis of 

21 timeliness or the failure to establish the basis for a 

22 claim. 

23 ‘‘(5) To accept or reject rate adjustment peti24 tions as provided in section 804 and petitions to par25 ticipate as provided in section 803(b)(1) and (2). 
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1 ‘‘(6) To determine the status of a digital audio 

2 recording device or a digital audio interface device 

3 under sections 1002 and 1003, as provided in sec4 tion 1010. 

5 ‘‘(7)(A) To adopt as the basis for statutory 

6 terms and rates or as a basis for the distribution of 

7 statutory royalty payments, an agreement con8 cerning such matters reached among some or all of 

9 the participants in a proceeding at any time during 

10 the proceeding, except that—

11 ‘‘(i) the Copyright Royalty Judges shall 

12 provide to the other participants in the pro13 ceeding under section 803(b)(2) that would be 

14 bound by the terms, rates, distribution, or other 

15 determination set by the agreement an oppor16 tunity to comment on the agreement and object 

17 to its adoption as the basis for statutory terms 

18 and rates or as a basis for the distribution of 

19 statutory royalty payments, as the case may be; 

20 and

21 ‘‘(ii) the Copyright Royalty Judges may 

22 decline to adopt the agreement as the basis for 

23 statutory terms and rates or as the basis for 

24 the distribution of statutory royalty payments, 

25 as the case may be, if any other participant de-
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1 scribed in subparagraph (A) objects to the 

2 agreement and the Copyright Royalty Judges 

3 find, based on the record before them, that the 

4 agreement is not likely to meet the statutory 

5 standard for setting the terms and rates, or for 

6 distributing the royalty payments, as the case 

7 may be.

8 ‘‘(B) License agreements voluntarily negotiated 

9 pursuant to section 112(e)(5), 114(f)(3), 

10 115(c)(3)(E)(i), 116(c), or 118(b)(2) that do not re11 sult in statutory terms and rates shall not be subject 

12 to clauses (i) and (ii) of subparagraph (A). 

13 ‘‘(c) RULINGS.—The Copyright Royalty Judges may 

14 make any necessary procedural or evidentiary rulings in 

15 any proceeding under this chapter and may, before com16 mencing a proceeding under this chapter, make any such 

17 rulings that would apply to the proceedings conducted by 

18 the Copyright Royalty Judges. The Copyright Royalty 

19 Judges may consult with the Register of Copyrights in 

20 making any rulings under section 802(f)(1).

21 ‘‘(d) ADMINISTRATIVE SUPPORT.—The Librarian of 

22 Congress shall provide the Copyright Royalty Judges with 

23 the necessary administrative services related to pro24 ceedings under this chapter. 
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1 ‘‘(e) LOCATION IN LIBRARY OF CONGRESS.—The of2 fices of the Copyright Royalty Judges and staff shall be 

3 in the Library of Congress. 

4 ‘‘§ 802. Copyright Royalty Judgeships; staff 

5 ‘‘(a) QUALIFICATIONS OF COPYRIGHT ROYALTY

6 JUDGES.—Each Copyright Royalty Judge shall be an at7 torney who has at least 7 years of legal experience. The 

8 Chief Copyright Royalty Judge shall have at least 5 years 

9 of experience in adjudications, arbitrations, or court trials. 

10 Of the other two Copyright Royalty Judges, one shall have 

11 significant knowledge of copyright law, and the other shall 

12 have significant knowledge of economics. An individual 

13 may serve as a Copyright Royalty Judge only if the indi14 vidual is free of any financial conflict of interest under 

15 subsection (h). In this subsection, ‘adjudication’ has the 

16 meaning given that term in section 551 of title 5, but does 

17 not include mediation. 

18 ‘‘(b) STAFF.—The Chief Copyright Royalty Judge 

19 shall hire 3 full-time staff members to assist the Copyright 

20 Royalty Judges in performing their functions. 

21 ‘‘(c) TERMS.—The terms of the Copyright Royalty 

22 Judges shall each be 6 years, except of the individuals first 

23 appointed, the Chief Copyright Royalty Judge shall be ap24 pointed to a term of 6 years, and of the remaining Copy25 right Royalty Judges, one shall be appointed to a term 
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1 of 2 years, and the other shall be appointed to a term 

2 of 4 years. An individual serving as a Copyright Royalty 

3 Judge may be reappointed to subsequent terms. The term 

4 of a Copyright Royalty Judge shall begin when the term 

5 of the predecessor of that Copyright Royalty Judge ends. 

6 When the term of office of a Copyright Royalty Judge 

7 ends, the individual serving that term may continue to 

8 serve until a successor is selected. 

9 ‘‘(d) VACANCIES OR INCAPACITY.—

10 ‘‘(1) VACANCIES.—If a vacancy should occur in 

11 the position of Copyright Royalty Judge, the Librar12 ian of Congress shall act expeditiously to fill the va13 cancy, and may appoint an interim Copyright Roy14 alty Judge to serve until another Copyright Royalty 

15 Judge is appointed under this section. An individual 

16 appointed to fill the vacancy occurring before the ex17 piration of the term for which the predecessor of 

18 that individual was appointed shall be appointed for 

19 the remainder of that term. 

20 ‘‘(2) INCAPACITY.—In the case in which a 

21 Copyright Royalty Judge is temporarily unable to 

22 perform his or her duties, the Librarian of Congress 

23 may appoint an interim Copyright Royalty Judge to 

24 perform such duties during the period of such inca25 pacity. 
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1 ‘‘(e) COMPENSATION.—

2 ‘‘(1) JUDGES.—The Chief Copyright Royalty 

3 Judge shall receive compensation at the rate of basic 

4 pay payable for level AL–1 for administrative law 

5 judges pursuant to section 5372(b) of title 5, and 

6 each of the other two Copyright Royalty Judges 

7 shall receive compensation at the rate of basic pay 

8 payable for level AL–2 for administrative law judges 

9 pursuant to such section. The compensation of the 

10 Copyright Royalty Judges shall not be subject to 

11 any regulations adopted by the Office of Personnel 

12 Management pursuant to its authority under section 

13 5376(b)(1) of title 5. 

14 ‘‘(2) STAFF MEMBERS.—Of the staff members 

15 appointed under subsection (b)—

16 ‘‘(A) the rate of pay of one staff member 

17 shall be not more than the basic rate of pay 

18 payable for GS–15 of the General Schedule; 

19 ‘‘(B) the rate of pay of one staff member 

20 shall be not less than the basic rate of pay pay21 able for GS–13 of the General Schedule and not 

22 more than the basic rate of pay payable for 

23 GS–14 of such Schedule; and 

24 ‘‘(C) the rate of pay for the third staff 

25 member shall be not less than the basic rate of 
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1 pay payable for GS–8 of the General Schedule 

2 and not more than the basic rate of pay payable 

3 for GS–11 of such Schedule. 

4 ‘‘(f) INDEPENDENCE OF COPYRIGHT ROYALTY

5 JUDGE.—

6 ‘‘(1) IN MAKING DETERMINATIONS.—

7 ‘‘(A) IN GENERAL.—Subject to subpara8 graph (B), the Copyright Royalty Judges shall 

9 have full independence in making determina10 tions concerning adjustments and determina11 tions of copyright royalty rates and terms, the 

12 distribution of copyright royalties, the accept13 ance or rejection of royalty claims, rate adjust14 ment petitions, and petitions to participate, and 

15 in issuing other rulings under this title, except 

16 that the Copyright Royalty Judges may consult 

17 with the Register of Copyrights on any matter 

18 other than a question of fact. Any such con19 sultations between the Copyright Royalty 

20 Judges and the Register of Copyright on any 

21 question of law shall be in writing or on the 

22 record. 

23 ‘‘(B) NOVEL QUESTIONS.—(i) Notwith24 standing the provisions of subparagraph (A), in 

25 any case in which the Copyright Royalty Judges 
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1 in a proceeding under this title are presented 

2 with a novel question of law concerning an in3 terpretation of those provisions of this title that 

4 are the subject of the proceeding, the Copyright 

5 Royalty Judges shall request the Register of 

6 Copyrights, in writing, to submit a written 

7 opinion on the resolution of such novel question. 

8 The Register shall submit and make public that 

9 opinion within such time period as the Copy10 right Royalty Judges may prescribe. Any con11 sultations under this subparagraph between the 

12 Copyright Royalty Judges and the Register of 

13 Copyrights shall be in writing or on the record. 

14 The opinion of the Register shall not be binding 

15 on the Copyright Royalty Judges, but the Copy16 right Royalty Judges shall take the opinion of 

17 the Register into account in making the judges’ 

18 determination on the question concerned. 

19 ‘‘(ii) In clause (i), a ‘novel question of law’ 

20 is a question of law that has not been deter21 mined in prior decisions, determinations, and 

22 rulings described in section 803(a). 

23 ‘‘(2) PERFORMANCE APPRAISALS.—

24 ‘‘(A) IN GENERAL.—Notwithstanding any 

25 other provision of law or any regulation of the 
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1 Library of Congress, and subject to subpara2 graph (B), the Copyright Royalty Judges shall 

3 not receive performance appraisals. 

4 ‘‘(B) RELATING TO SANCTION OR RE5 MOVAL.—To the extent that the Librarian of 

6 Congress adopts regulations under subsection 

7 (h) relating to the sanction or removal of a 

8 Copyright Royalty Judge and such regulations 

9 require documentation to establish the cause of 

10 such sanction or removal, the Copyright Roy11 alty Judge may receive an appraisal related 

12 specifically to the cause of the sanction or re13 moval. 

14 ‘‘(g) INCONSISTENT DUTIES BARRED.—No Copy15 right Royalty Judge may undertake duties inconsistent 

16 with his or her duties and responsibilities as Copyright 

17 Royalty Judge. 

18 ‘‘(h) STANDARDS OF CONDUCT.—The Librarian of 

19 Congress shall adopt regulations regarding the standards 

20 of conduct, including financial conflict of interest and re21 strictions against ex parte communications, which shall 

22 govern the Copyright Royalty Judges and the proceedings 

23 under this chapter. 

24 ‘‘(i) REMOVAL OR SANCTION.—The Librarian of Con25 gress may sanction or remove a Copyright Royalty Judge 
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1 for violation of the standards of conduct adopted under 

2 subsection (h), misconduct, neglect of duty, or any dis3 qualifying physical or mental disability. Any such sanction 

4 or removal may be made only after notice and opportunity 

5 for a hearing, but the Librarian of Congress may suspend 

6 the Copyright Royalty Judge during the pendency of such 

7 hearing. The Librarian shall appoint an interim Copyright 

8 Royalty Judge during the period of any such suspension. 

9 ‘‘§ 803. Proceedings of Copyright Royalty Judges 

10 ‘‘(a) PROCEEDINGS.—

11 ‘‘(1) IN GENERAL.—The Copyright Royalty 

12 Judges shall act in accordance with this title, and to 

13 the extent not inconsistent with this title, in accord14 ance with subchapter II of chapter 5 of title 5, in 

15 carrying out the purposes set forth in section 801. 

16 The Copyright Royalty Judges shall act in accord17 ance with regulations issued by the Copyright Roy18 alty Judges and on the basis of a fully documented 

19 written record, prior decisions of the Copyright Roy20 alty Tribunal, prior copyright arbitration royalty 

21 panel determinations, rulings by the Librarian of 

22 Congress before the effective date of the Copyright 

23 Royalty and Distribution Reform Act of 2004, prior 

24 determinations of Copyright Royalty Judges under 

25 this chapter, and decisions of the court in appeals 
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1 under this chapter before, on, or after such effective 

2 date. Any participant in a proceeding under sub3 section (b)(2) may submit relevant information and 

4 proposals to the Copyright Royalty Judges. 

5 ‘‘(2) JUDGES ACTING AS PANEL AND INDIVID6 UALLY.—The Copyright Royalty Judges shall pre7 side over hearings in proceedings under this chapter 

8 en banc. The Chief Copyright Royalty Judge may 

9 designate a Copyright Royalty Judge to preside indi10 vidually over such collateral and administrative pro11 ceedings, and over such proceedings under para12 graphs (1) through (5) of subsection (b), as the 

13 Chief Judge considers appropriate. 

14 ‘‘(3) DETERMINATIONS.—Final determinations 

15 of the Copyright Royalty Judges in proceedings 

16 under this chapter shall be made by majority vote. 

17 A Copyright Royalty Judge dissenting from the ma18 jority on any determination under this chapter may 

19 issue his or her dissenting opinion, which shall be in20 cluded with the determination. 

21 ‘‘(b) PROCEDURES.—

22 ‘‘(1) INITIATION.—

23 ‘‘(A) CALL FOR PETITIONS TO PARTICI24 PATE.—(i) Promptly upon the filing of a peti25 tion for a rate adjustment or determination 
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1 under section 804(a) or 804(b)(8), or by no 

2 later than January 5 of a year specified in sec3 tion 804 for the commencement of a proceeding 

4 if a petition has not been filed by that date, the 

5 Copyright Royalty Judges shall cause to be 

6 published in the Federal Register notice of com7 mencement of proceedings under this chapter 

8 calling for the filing of petitions to participate 

9 in a proceeding under this chapter for the pur10 pose of making the relevant determination 

11 under section 111, 112, 114, 115, 116, 118, 

12 119, 1004 or 1007, as the case may be. 

13 ‘‘(ii) Petitions to participate shall be filed 

14 by no later than 30 days after publication of 

15 notice of commencement of a proceeding, under 

16 clause (i), except that the Copyright Royalty 

17 Judges may, for substantial good cause shown 

18 and if there is no prejudice to the participants 

19 that have already filed petitions, accept late pe20 titions to participate at any time up to the date 

21 that is 90 days before the date on which par22 ticipants in the proceeding are to file their writ23 ten direct statements. 

24 ‘‘(B) PETITIONS TO PARTICIPATE.—Each 

25 petition to participate in a proceeding shall de-
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1 scribe the petitioner’s interest in the subject 

2 matter of the proceeding. Parties with similar 

3 interests may file a single petition to partici4 pate. 

5 ‘‘(2) PARTICIPATION IN GENERAL.—Subject to 

6 paragraph (4), a person may participate in a pro7 ceeding under this chapter, including through the 

8 submission of briefs or other information, only if—

9 ‘‘(A) that person has filed a petition to 

10 participate in accordance with paragraph (1) 

11 (either individually or as a group under para12 graph (1)(B)), together with a filing fee of 

13 $150; 

14 ‘‘(B) the Copyright Royalty Judges have 

15 not determined that the petition to participate 

16 is facially invalid; and 

17 ‘‘(C) the Copyright Royalty Judges have 

18 not determined, sua sponte or on the motion of 

19 another participant in the proceeding, that the 

20 person lacks a significant interest in the pro21 ceeding. 

22 ‘‘(3) VOLUNTARY NEGOTIATION PERIOD.—

23 ‘‘(A) IN GENERAL.—Promptly after the 

24 date for filing of petitions to participate in a 

25 proceeding, the Copyright Royalty Judges shall 
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1 make available to all participants in the pro2 ceeding a list of such participants and shall ini3 tiate a voluntary negotiation period among the 

4 participants. 

5 ‘‘(B) LENGTH OF PROCEEDINGS.—The vol6 untary negotiation period initiated under sub7 paragraph (A) shall be 3 months. 

8 ‘‘(C) DETERMINATION OF SUBSEQUENT

9 PROCEEDINGS.—At the close of the voluntary 

10 negotiation proceedings, the Copyright Royalty 

11 Judges shall, if further proceedings under this 

12 chapter are necessary, determine whether and 

13 to what extent paragraphs (4) and (5) will 

14 apply to the parties. 

15 ‘‘(4) SMALL CLAIMS PROCEDURE IN DISTRIBU16 TION PROCEEDINGS.—

17 ‘‘(A) IN GENERAL.—If, in a proceeding 

18 under this chapter to determine the distribution 

19 of royalties, a participant in the proceeding as20 serts that the contested amount of the claim is 

21 $10,000 or less, the Copyright Royalty Judges 

22 shall decide the controversy on the basis of the 

23 filing in writing of the initial claim, the initial 

24 response by any opposing participant, and one 

25 additional response by each such party. The 
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1 participant asserting the claim shall not be re2 quired to pay the filing fee under paragraph 

3 (2). 

4 ‘‘(B) BAD FAITH INFLATION OF CLAIM.—

5 If the Copyright Royalty Judges determine that 

6 a participant asserts in bad faith an amount in 

7 controversy in excess of $10,000 for the pur8 pose of avoiding a determination under the pro9 cedure set forth in subparagraph (A), the Copy10 right Royalty Judges shall impose a fine on 

11 that participant in an amount not to exceed the 

12 difference between the actual amount distrib13 uted and the amount asserted by the partici14 pant. 

15 ‘‘(5) PAPER PROCEEDINGS IN RATEMAKING

16 PROCEEDINGS.—The Copyright Royalty Judges in 

17 proceedings under this chapter to determine royalty 

18 rates may decide, sua sponte or upon motion of a 

19 participant, to determine issues on the basis of ini20 tial filings in writing, initial responses by any oppos21 ing participant, and one additional response by each 

22 such participant. Prior to making such decision to 

23 proceed on such a paper record only, the Copyright 

24 Royalty Judges shall offer to all parties to the pro-
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1 ceeding the opportunity to comment on the decision. 

2 The procedure under this paragraph—

3 ‘‘(A) shall be applied in cases in which 

4 there is no genuine issue of material fact, there 

5 is no need for evidentiary hearings, and all par6 ticipants in the proceeding agree in writing to 

7 the procedure; and 

8 ‘‘(B) may be applied under such other cir9 cumstances as the Copyright Royalty Judges 

10 consider appropriate. 

11 ‘‘(6) REGULATIONS.—

12 ‘‘(A) IN GENERAL.—The Copyright Roy13 alty Judges may issue regulations to carry out 

14 their functions under this title. Not later than 

15 120 days after Copyright Royalty Judges or in16 terim Copyright Royalty Judges, as the case 

17 may be, are first appointed after the enactment 

18 of the Copyright Royalty and Distribution Re19 form Act of 2004, such judges shall issue regu20 lations to govern proceedings under this chap21 ter. 

22 ‘‘(B) INTERIM REGULATIONS.—Until regu23 lations are adopted under subparagraph (A), 

24 the Copyright Royalty Judges shall apply the 

25 regulations in effect under this chapter on the 
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1 day before the effective date of the Copyright 

2 Royalty and Distribution Reform Act of 2004, 

3 to the extent such regulations are not incon4 sistent with this chapter, except that functions 

5 carried out under such regulations by the Li6 brarian of Congress, the Register of Copyrights, 

7 or copyright arbitration royalty panels that, as 

8 of such date of enactment, are to be carried out 

9 by the Copyright Royalty Judges under this 

10 chapter, shall be carried out by the Copyright 

11 Royalty Judges under such regulations. 

12 ‘‘(C) REQUIREMENTS.—Regulations issued 

13 under subparagraph (A) shall include the fol14 lowing: 

15 ‘‘(i) The written direct statements of 

16 all participants in a proceeding under 

17 paragraph (2) shall be filed by a date spec18 ified by the Copyright Royalty Judges, 

19 which may be no earlier than four months, 

20 and no later than five months, after the 

21 end of the voluntary negotiation period 

22 under paragraph (3). Notwithstanding the 

23 preceding sentence, a participant in a pro24 ceeding may, within 15 days after the end 

25 of the discovery period specified in clause 
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1 (iii), file an amended written direct state2 ment based on new information received 

3 during the discovery process. 

4 ‘‘(ii)(I) Following the submission to 

5 the Copyright Royalty Judges of written 

6 direct statements by the participants in a 

7 proceeding under paragraph (2), the 

8 judges shall meet with the participants for 

9 the purpose of setting a schedule for con10 ducting and completing discovery. Such 

11 schedule shall be determined by the Copy12 right Royalty Judges. 

13 ‘‘(II) In this chapter, the term ‘writ14 ten direct statements’ means witness state15 ments, testimony, and exhibits to be pre16 sented in the proceedings, and such other 

17 information that is necessary to establish 

18 terms and rates, or the distribution of roy19 alty payments, as the case may be, as set 

20 forth in regulations issued by the Copy21 right Royalty Judges.

22 ‘‘(iii) Hearsay may be admitted in 

23 proceedings under this chapter to the ex24 tent deemed appropriate by the Copyright 

25 Royalty Judges. 
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1 ‘‘(iv) Discovery in such proceedings 

2 shall be permitted for a period of 60 days, 

3 except for discovery ordered by the Copy4 right Royalty Judges in connection with 

5 the resolution of motions, orders and dis6 putes pending at the end of such period.

7 ‘‘(v) Any participant under paragraph 

8 (2) in a proceeding under this chapter to 

9 determine royalty rates may, upon written 

10 notice, seek discovery of information and 

11 materials relevant and material to the pro12 ceeding. Any objection to any such dis13 covery request shall be resolved by a mo14 tion or request to compel discovery made 

15 to the Copyright Royalty Judges. Each 

16 motion or request to compel discovery shall 

17 be determined by the Copyright Royalty 

18 Judges, or by a Copyright Royalty Judge 

19 when permitted under subsection (a)(2), 

20 who may approve the request only if the 

21 evidence that would be produced is relevant 

22 and material. A Copyright Royalty Judge 

23 may refuse a request to compel discovery 

24 of evidence that has been found to be rel25 evant and material, only upon good cause 
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1 shown. For purposes of the preceding sen2 tence, the basis for ‘good cause’ may only 

3 be that—

4 ‘‘(I) the discovery sought is un5 reasonably cumulative or duplicative, 

6 or is obtainable from another source 

7 that is more convenient, less burden8 some, or less expensive; 

9 ‘‘(II) the participant seeking dis10 covery has had ample opportunity by 

11 discovery in the action to obtain the 

12 information sought; or 

13 ‘‘(III) the burden or expense of 

14 the proposed discovery outweighs its 

15 likely benefit, taking into account the 

16 needs and resources of the partici17 pants, the importance of the issues at 

18 stake, and the importance of the pro19 posed discovery in resolving the 

20 issues. 

21 ‘‘(vi) The rules in effect on the day 

22 before the effective date of the Copyright 

23 Royalty and Distribution Reform Act of 

24 2004, relating to discovery in proceedings 

25 under this title to determine the distribu-
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1 tion of royalty fees, shall continue to apply 

2 to such proceedings on and after such ef3 fective date. 

4 ‘‘(vii) The Copyright Royalty Judges 

5 may issue subpoenas requiring the produc6 tion of evidence or witnesses, but only if 

7 the evidence requested to be produced or 

8 that would be proffered by the witness is 

9 relevant and material. 

10 ‘‘(viii) The Copyright Royalty Judges 

11 shall order a settlement conference among 

12 the participants in the proceeding to facili13 tate the presentation of offers of settle14 ment among the participants. The settle15 ment conference shall be held during a 21-

16 day period following the end of the dis17 covery period. 

18 ‘‘(c) DETERMINATION OF COPYRIGHT ROYALTY

19 JUDGES.—

20 ‘‘(1) TIMING.—The Copyright Royalty Judges 

21 shall issue their determination in a proceeding not 

22 later than 11 months after the conclusion of the 21-

23 day settlement conference period under subsection 

24 (b)(3)(C)(vi), but, in the case of a proceeding to de25 termine successors to rates or terms that expire on 
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•HR 1417 RS 

1 a specified date, in no event later than 15 days be2 fore the expiration of the then current statutory 

3 rates and terms. 

4 ‘‘(2) REHEARINGS.—

5 ‘‘(A) IN GENERAL.—The Copyright Roy6 alty Judges may, in exceptional cases, upon mo7 tion of a participant under subsection (b)(2), 

8 order a rehearing, after the determination in a 

9 proceeding is issued under paragraph (1), on 

10 such matters as the Copyright Royalty Judges 

11 determine to be appropriate. 

12 ‘‘(B) TIMING FOR FILING MOTION.—Any 

13 motion for a rehearing under subparagraph (A) 

14 may only be filed within 15 days after the date 

15 on which the Copyright Royalty Judges deliver 

16 their initial determination concerning rates and 

17 terms to the participants in the proceeding. 

18 ‘‘(C) PARTICIPATION BY OPPOSING PARTY

19 NOT REQUIRED.—In any case in which a re20 hearing is ordered, any opposing party shall not 

21 be required to participate in the rehearing. 

22 ‘‘(D) NO NEGATIVE INFERENCE.—No neg23 ative inference shall be drawn from lack of par24 ticipation in a rehearing. 
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•HR 1417 RS 

1 ‘‘(E) CONTINUITY OF RATES AND

2 TERMS.—(i) If the decision of the Copyright 

3 Royalty Judges on any motion for a rehearing 

4 is not rendered before the expiration of the 

5 statutory rates and terms that were previously 

6 in effect, in the case of a proceeding to deter7 mine successors to rates and terms that expire 

8 on a specified date, then—

9 ‘‘(I) the initial determination of the 

10 Copyright Royalty Judges that is the sub11 ject of the rehearing motion shall be effec12 tive as of the day following the date on 

13 which the rates and terms that were pre14 viously in effect expire; and 

15 ‘‘(II) in the case of a proceeding 

16 under section 114(f)(1)(C) or 114(f)(2)(C), 

17 royalty rates and terms shall, for purposes 

18 of section 114(f)(4)(B), be deemed to have 

19 been set at those rates and terms con20 tained in the initial determination of the 

21 Copyright Royalty Judges that is the sub22 ject of the rehearing motion, as of the date 

23 of that determination. 

24 ‘‘(ii) The pendency of a motion for a re25 hearing under this paragraph shall not relieve 
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•HR 1417 RS 

1 persons obligated to make royalty payments 

2 who would be affected by the determination on 

3 that motion from providing the statements of 

4 account and any reports of use, to the extent 

5 required, and paying the royalties required 

6 under the relevant determination or regulations. 

7 ‘‘(iii) Notwithstanding clause (ii), whenever 

8 royalties described in clause (ii) are paid to a 

9 person other than the Copyright Office, the en10 tity designated by the Copyright Royalty 

11 Judges to which such royalties are paid by the 

12 copyright user (and any successor thereto) 

13 shall, within 60 days after the motion for re14 hearing is resolved or, if the motion is granted, 

15 within 60 days after the rehearing is concluded, 

16 return any excess amounts previously paid to 

17 the extent necessary to comply with the final 

18 determination of royalty rates by the Copyright 

19 Royalty Judges. 

20 ‘‘(3) CONTENTS OF DETERMINATION.—A deter21 mination of the Copyright Royalty Judges shall be 

22 accompanied by the written record, and shall set 

23 forth the facts that the Copyright Royalty Judges 

24 found relevant to their determination. Among other 

25 terms adopted in a determination, the Copyright 
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•HR 1417 RS 

1 Royalty Judges may specify notice and record2 keeping requirements of users of the copyrights at 

3 issue that apply in lieu of those that would otherwise 

4 apply under regulations. 

5 ‘‘(4) CONTINUING JURISDICTION.—The Copy6 right Royalty Judges may amend the determination 

7 or the regulations issued pursuant to the determina8 tion in order to correct any technical errors in the 

9 determination or to respond to unforeseen cir10 cumstances that preclude the proper effectuation of 

11 the determination. 

12 ‘‘(5) PROTECTIVE ORDER.—The Copyright Roy13 alty Judges may issue such orders as may be appro14 priate to protect confidential information, including 

15 orders excluding confidential information from the 

16 record of the determination that is published or 

17 made available to the public, except that any terms 

18 or rates of royalty payments or distributions may 

19 not be excluded. 

20 ‘‘(6) PUBLICATION OF DETERMINATION.—The 

21 Librarian of Congress shall cause the determination, 

22 and any corrections thereto, to be published in the 

23 Federal Register. The Librarian of Congress shall 

24 also publicize the determination and corrections in 

25 such other manner as the Librarian considers appro-
33

•HR 1417 RS 

1 priate, including, but not limited to, publication on 

2 the Internet. The Librarian of Congress shall also 

3 make the determination, corrections, and the accom4 panying record available for public inspection and 

5 copying. 

6 ‘‘(d) JUDICIAL REVIEW.—

7 ‘‘(1) APPEAL.—Any determination of the Copy8 right Royalty Judges under subsection (c) may, 

9 within 30 days after the publication of the deter10 mination in the Federal Register, be appealed, to the 

11 United States Court of Appeals for the District of 

12 Columbia Circuit, by any aggrieved participant in 

13 the proceeding under subsection (b)(2) who fully 

14 participated in the proceeding and who would be 

15 bound by the determination. If no appeal is brought 

16 within that 30-day period, the determination of the 

17 Copyright Royalty Judges shall be final, and the 

18 royalty fee or determination with respect to the dis19 tribution of fees, as the case may be, shall take ef20 fect as set forth in paragraph (2). 

21 ‘‘(2) EFFECT OF RATES.—

22 ‘‘(A) EXPIRATION ON SPECIFIED DATE.—

23 When this title provides that the royalty rates 

24 and terms that were previously in effect are to 

25 expire on a specified date, any adjustment or 
34

•HR 1417 RS 

1 determination by the Copyright Royalty Judges 

2 of successor rates and terms for an ensuing 

3 statutory license period shall be effective as of 

4 the day following the date of expiration of the 

5 rates and terms that were previously in effect, 

6 even if the determination of the Copyright Roy7 alty Judges is rendered on a later date. 

8 ‘‘(B) OTHER CASES.—In cases where rates 

9 and terms do not expire on a specified date or 

10 have not yet been established, successor or new 

11 rates or terms shall take effect on the first day 

12 of the second month that begins after the publi13 cation of the determination of the Copyright 

14 Royalty Judges in the Federal Register, except 

15 as otherwise provided in this title, and the rates 

16 and terms previously in effect, to the extent ap17 plicable, shall remain in effect until such suc18 cessor rates and terms become effective. 

19 ‘‘(C) OBLIGATION TO MAKE PAYMENTS.—

20 (i) The pendency of an appeal under this sub21 section shall not relieve persons obligated to 

22 make royalty payments under section 111, 112, 

23 114, 115, 116, 118, 119, or 1003, who would 

24 be affected by the determination on appeal, 

25 from providing the statements of account (and 
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•HR 1417 RS 

1 any report of use, to the extent required) and 

2 paying the royalties required under the relevant 

3 determination or regulations. 

4 ‘‘(ii) Notwithstanding clause (i), whenever 

5 royalties described in clause (i) are paid to a 

6 person other than the Copyright Office, the en7 tity designated by the Copyright Royalty 

8 Judges to which such royalties are paid by the 

9 copyright user (and any successor thereto) 

10 shall, within 60 days after the final resolution 

11 of the appeal, return any excess amounts pre12 viously paid (and interest thereon, if ordered 

13 pursuant to paragraph (3)) to the extent nec14 essary to comply with the final determination of 

15 royalty rates on appeal. 

16 ‘‘(3) JURISDICTION OF COURT.—If the court, 

17 pursuant to section 706 of title 5, modifies or va18 cates a determination of the Copyright Royalty 

19 Judges, the court may enter its own determination 

20 with respect to the amount or distribution of royalty 

21 fees and costs, and order the repayment of any ex22 cess fees, the payment of any underpaid fees, and 

23 the payment of interest pertaining respectively there24 to, in accordance with its final judgment. The court 

25 may also vacate the determination of the Copyright 
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•HR 1417 RS 

1 Royalty Judges and remand the case to the Copy2 right Royalty Judges for further proceedings in ac3 cordance with subsection (a). 

4 ‘‘(e) ADMINISTRATIVE MATTERS.—

5 ‘‘(1) DEDUCTION OF COSTS OF LIBRARY OF

6 CONGRESS AND COPYRIGHT OFFICE FROM FILING

7 FEES.—

8 ‘‘(A) DEDUCTION FROM FILING FEES.—

9 The Librarian of Congress may, to the extent 

10 not otherwise provided under this title, deduct 

11 from the filing fees collected under subsection 

12 (b) for a particular proceeding under this chap13 ter the reasonable costs incurred by the Librar14 ian of Congress, the Copyright Office, and the 

15 Copyright Royalty Judges in conducting that 

16 proceeding, other than the salaries of the Copy17 right Royalty Judges and the 3 staff members 

18 appointed under section 802(b).

19 ‘‘(B) AUTHORIZATION OF APPROPRIA20 TIONS.—There are authorized to be appro21 priated such sums as may be necessary to pay 

22 the costs of proceedings under this chapter not 

23 covered by the filing fees collected under sub24 section (b). All funds made available pursuant 
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•HR 1417 RS 

1 to this subparagraph shall remain available 

2 until expended. 

3 ‘‘(2) POSITIONS REQUIRED FOR ADMINISTRA4 TION OF COMPULSORY LICENSING.—Section 307 of 

5 the Legislative Branch Appropriations Act, 1994, 

6 shall not apply to employee positions in the Library 

7 of Congress that are required to be filled in order 

8 to carry out section 111, 112, 114, 115, 116, 118, 

9 or 119 or chapter 10. 

10 ‘‘§ 804. Institution of proceedings 

11 ‘‘(a) FILING OF PETITION.—With respect to pro12 ceedings referred to in paragraphs (1) and (2) of section 

13 801(b) concerning the determination or adjustment of roy14 alty rates as provided in sections 111, 112, 114, 115, 116, 

15 118, and 1004, during the calendar years specified in the 

16 schedule set forth in subsection (b), any owner or user 

17 of a copyrighted work whose royalty rates are specified 

18 by this title, or are established under this chapter before 

19 or after the enactment of the Copyright Royalty and Dis20 tribution Reform Act of 2004, may file a petition with the 

21 Copyright Royalty Judges declaring that the petitioner re22 quests a determination or adjustment of the rate. The 

23 Copyright Royalty Judges shall make a determination as 

24 to whether the petitioner has such a significant interest 

25 in the royalty rate in which a determination or adjustment 
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•HR 1417 RS 

1 is requested. If the Copyright Royalty Judges determine 

2 that the petitioner has such a significant interest, the 

3 Copyright Royalty Judges shall cause notice of this deter4 mination, with the reasons therefor, to be published in the 

5 Federal Register, together with the notice of commence6 ment of proceedings under this chapter. With respect to 

7 proceedings under paragraph (1) of section 801(b) con8 cerning the determination or adjustment of royalty rates 

9 as provided in sections 112 and 114, during the calendar 

10 years specified in the schedule set forth in subsection (b), 

11 the Copyright Royalty Judges shall cause notice of com12 mencement of proceedings under this chapter to be pub13 lished in the Federal Register as provided in section 

14 803(b)(1)(A). 

15 ‘‘(b) TIMING OF PROCEEDINGS.—

16 ‘‘(1) SECTION 111 PROCEEDINGS.—(A) A peti17 tion described in subsection (a) to initiate pro18 ceedings under section 801(b)(2) concerning the ad19 justment of royalty rates under section 111 to which 

20 subparagraph (A) or (D) of section 801(b)(2) ap21 plies may be filed during the year 2005 and in each 

22 subsequent fifth calendar year. 

23 ‘‘(B) In order to initiate proceedings under sec24 tion 801(b)(2) concerning the adjustment of royalty 

25 rates under section 111 to which subparagraph (B) 
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•HR 1417 RS 

1 or (C) of section 801(b)(2) applies, within 12 

2 months after an event described in either of those 

3 subsections, any owner or user of a copyrighted 

4 work whose royalty rates are specified by section 

5 111, or by a rate established under this chapter be6 fore or after the enactment of the Copyright Royalty 

7 and Distribution Reform Act of 2004, may file a pe8 tition with the Copyright Royalty Judges declaring 

9 that the petitioner requests an adjustment of the 

10 rate. The Copyright Royalty Judges shall then pro11 ceed as set forth in subsection (a) of this section. 

12 Any change in royalty rates made under this chapter 

13 pursuant to this subparagraph may be reconsidered 

14 in the year 2005, and each fifth calendar year there15 after, in accordance with the provisions in section 

16 801(b)(3)(B) or (C), as the case may be. A petition 

17 for adjustment of rates under section 11(d)(1)(B) as 

18 a result of a change is the rules and regulations of 

19 the Federal Communications Commission shall set 

20 forth the change on which the petition is based. 

21 ‘‘(C) Any adjustment of royalty rates under sec22 tion 111 shall take effect as of the first accounting 

23 period commencing after the publication of the de24 termination of the Copyright Royalty Judges in the 
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1 Federal Register, or on such other date as is speci2 fied in that determination. 

3 ‘‘(2) CERTAIN SECTION 112 PROCEEDINGS.—

4 Proceedings under this chapter shall be commenced 

5 in the year 2007 to determine reasonable terms and 

6 rates of royalty payments for the activities described 

7 in section 112(e)(1) relating to the limitation on ex8 clusive rights specified by section 114(d)(1)(C)(iv), 

9 to become effective on January 1, 2009. Such pro10 ceedings shall be repeated in each subsequent fifth 

11 calendar year. 

12 ‘‘(3) SECTION 114 AND CORRESPONDING 112

13 PROCEEDINGS.—

14 ‘‘(A) FOR ELIGIBLE NONSUBSCRIPTION

15 SERVICES AND NEW SUBSCRIPTION SERVICES.—

16 Proceedings under this chapter shall be com17 menced as soon as practicable after the effective 

18 date of the Copyright Royalty and Distribution 

19 Reform Act of 2004 to determine reasonable 

20 terms and rates of royalty payments under sec21 tions 114 and 112 for the activities of eligible 

22 nonsubscription transmission services and new 

23 subscription services, to be effective for the pe24 riod beginning on January 1, 2006, and ending 

25 on December 31, 2010. Such proceedings shall 
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•HR 1417 RS 

1 next be commenced in January 2009 to deter2 mine reasonable terms and rates of royalty pay3 ments, to become effective on January 1, 2011. 

4 Thereafter, such proceedings shall be repeated 

5 in each subsequent fifth calendar year. 

6 ‘‘(B) FOR PREEXISTING SUBSCRIPTION

7 AND SATELLITE DIGITAL AUDIO RADIO SERV8 ICES.—Proceedings under this chapter shall be 

9 commenced in January 2006 to determine rea10 sonable terms and rates of royalty payments 

11 under sections 114 and 112 for the activities of 

12 preexisting subscription services, to be effective 

13 during the period beginning on January 1, 

14 2008, and ending on December 31, 2012, and 

15 preexisting satellite digital audio radio services, 

16 to be effective during the period beginning on 

17 January 1, 2007, and ending on December 31, 

18 2012. Such proceedings shall next be com19 menced in 2011 to determine reasonable terms 

20 and rates of royalty payments, to become effec21 tive on January 1, 2013. Thereafter, such pro22 ceedings shall be repeated in each subsequent 

23 fifth calendar year. 

24 ‘‘(C)(i) Notwithstanding any other provi25 sion of this chapter, this subparagraph shall 
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1 govern proceedings commenced pursuant to sec2 tions 114(f)(1)(C) and 114(f)(2)(C) concerning 

3 new types of services. 

4 ‘‘(ii) Not later than 30 days after a peti5 tion to determine rates and terms for a new 

6 type of service that is filed by any copyright 

7 owner of sound recordings, or such new type of 

8 service, indicating that such new type of service 

9 is or is about to become operational, the Copy10 right Royalty Judges shall issue a notice for a 

11 proceeding to determine rates and terms for 

12 such service. 

13 ‘‘(iii) The proceeding shall follow the 

14 schedule set forth in such subsections (b), (c), 

15 and (d) of section 803, except that—

16 ‘‘(I) the determination shall be issued 

17 by not later than 24 months after the pub18 lication of the notice under clause (ii); and 

19 ‘‘(II) the decision shall take effect as 

20 provided in subsections (c)(2) and (d)(2) of 

21 section 803 and section 114(f)(4)(B)(ii) 

22 and (C). 

23 ‘‘(iv) The rates and terms shall remain in 

24 effect for the period set forth in section 
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1 114(f)(1)(C) or 114(f)(2)(C), as the case may 

2 be. 

3 ‘‘(4) SECTION 115 PROCEEDINGS.—A petition 

4 described in subsection (a) to initiate proceedings 

5 under section 801(b)(1) concerning the adjustment 

6 or determination of royalty rates as provided in sec7 tion 115 may be filed in the year 2006 and in each 

8 subsequent fifth calendar year, or at such other 

9 times as the parties have agreed under section 

10 115(c)(3)(B) and (C). 

11 ‘‘(5) SECTION 116 PROCEEDINGS.—(A) A peti12 tion described in subsection (a) to initiate pro13 ceedings under section 801(b) concerning the deter14 mination of royalty rates and terms as provided in 

15 section 116 may be filed at any time within 1 year 

16 after negotiated licenses authorized by section 116 

17 are terminated or expire and are not replaced by 

18 subsequent agreements. 

19 ‘‘(B) If a negotiated license authorized by sec20 tion 116 is terminated or expires and is not replaced 

21 by another such license agreement which provides 

22 permission to use a quantity of musical works not 

23 substantially smaller than the quantity of such 

24 works performed on coin-operated phonorecord play25 ers during the 1-year period ending March 1, 1989, 
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1 the Copyright Royalty Judges shall, upon petition 

2 filed under paragraph (1) within 1 year after such 

3 termination or expiration, commence a proceeding to 

4 promptly establish an interim royalty rate or rates 

5 for the public performance by means of a coin-oper6 ated phonorecord player of nondramatic musical 

7 works embodied in phonorecords which had been 

8 subject to the terminated or expired negotiated li9 cense agreement. Such rate or rates shall be the 

10 same as the last such rate or rates and shall remain 

11 in force until the conclusion of proceedings by the 

12 Copyright Royalty Judges, in accordance with sec13 tion 803, to adjust the royalty rates applicable to 

14 such works, or until superseded by a new negotiated 

15 license agreement, as provided in section 116(b).

16 ‘‘(6) SECTION 118 PROCEEDINGS.—A petition 

17 described in subsection (a) to initiate proceedings 

18 under section 801(b)(1) concerning the determina19 tion of reasonable terms and rates of royalty pay20 ments as provided in section 118 may be filed in the 

21 year 2006 and in each subsequent fifth calendar 

22 year. 

23 ‘‘(7) SECTION 1004 PROCEEDINGS.—A petition 

24 described in subsection (a) to initiate proceedings 

25 under section 801(b)(1) concerning the adjustment 
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1 of reasonable royalty rates under section 1004 may 

2 be filed as provided in section 1004(a)(3). 

3 ‘‘(8) PROCEEDINGS CONCERNING DISTRIBUTION

4 OF ROYALTY FEES.—With respect to proceedings 

5 under section 801(b)(3) concerning the distribution 

6 of royalty fees in certain circumstances under sec7 tion 111, 116, 119, or 1007, the Copyright Royalty 

8 Judges shall, upon a determination that a con9 troversy exists concerning such distribution, cause to 

10 be published in the Federal Register notice of com11 mencement of proceedings under this chapter. 

12 ‘‘§ 805. General rule for voluntarily negotiated agree13 ments 

14 ‘‘Any rates or terms under this title that—

15 ‘‘(1) are agreed to by participants to a pro16 ceeding under section 803(b)(2), 

17 ‘‘(2) are adopted by the Copyright Royalty 

18 Judges as part of a determination under this chap19 ter, and 

20 ‘‘(3) are in effect for a period shorter than 

21 would otherwise apply under a determination pursu22 ant to this chapter, 

23 shall remain in effect for such period of time as would 

24 otherwise apply under such determination, except that the 

25 Copyright Royalty Judges shall adjust the rates pursuant 
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1 to the voluntary negotiations to reflect national monetary 

2 inflation during the additional period the rates remain in 

3 effect.’’. 

4 (b) CONFORMING AMENDMENT.—The table of chap5 ters for title 17, United States Code, is amended by strik6 ing the item relating to chapter 8 and inserting the fol7 lowing:

‘‘8. Proceedings by Copyright Royalty Judges ....................... 801’’.

8 SEC. 4. DEFINITION. 

9 Section 101 is amended by inserting after the defini10 tion of ‘‘copies’’ the following: 

11 ‘‘A ‘Copyright Royalty Judge’ is a Copyright 

12 Royalty Judge appointed under section 802 of this 

13 title, and includes any individual serving as an in14 terim Copyright Royalty Judge under such section.’’. 

15 SEC. 5. TECHNICAL AMENDMENTS. 

16 (a) CABLE RATES.—Section 111(d) is amended—

17 (1) in paragraph (2), in the second sentence, by 

18 striking ‘‘a copyright arbitration royalty panel’’ and 

19 inserting ‘‘the Copyright Royalty Judges.’’; and 

20 (2) in paragraph (4)—

21 (A) in subparagraph (A), by striking ‘‘Li22 brarian of Congress’’ each place it appears and 

23 inserting ‘‘Copyright Royalty Judges’’; 

24 (B) in subparagraph (B)—
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1 (i) in the first sentence, by striking 

2 ‘‘Librarian of Congress shall, upon the rec3 ommendation of the Register of Copy4 rights,’’ and inserting ‘‘Copyright Royalty 

5 Judges shall’’; 

6 (ii) in the second sentence, by striking 

7 ‘‘Librarian determines’’ and inserting 

8 ‘‘Copyright Royalty Judges determine’’; 

9 and 

10 (iii) in the third sentence—

11 (I) by striking ‘‘Librarian’’ each 

12 place it appears and inserting ‘‘Copy13 right Royalty Judges’’; and 

14 (II) by striking ‘‘convene a copy15 right arbitration royalty panel’’ and 

16 inserting ‘‘conduct a proceeding’’; and 

17 (C) in subparagraph (C), by striking ‘‘Li18 brarian of Congress’’ and inserting ‘‘Copyright 

19 Royalty Judges’’.

20 (b) EPHEMERAL RECORDINGS.—Section 112(e) is 

21 amended—

22 (1) in paragraph (3)—

23 (A) by amending the first sentence to read 

24 as follows: ‘‘Voluntary negotiation proceedings 

25 initiated pursuant to section 804(a) for the pur-
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1 pose of determining reasonable terms and rates 

2 of royalty payments for the activities specified 

3 by paragraph (1) shall cover the 5-year period 

4 beginning on January 1 of the second year fol5 lowing the year in which the proceedings are 

6 commenced, or such other period as the parties 

7 may agree.’’; and 

8 (B) in the third sentence, by striking ‘‘Li9 brarian of Congress’’ and inserting ‘‘Copyright 

10 Royalty Judges’’; 

11 (2) in paragraph (4)—

12 (A) by amending the first sentence to read 

13 as follows: ‘‘In the absence of license agree14 ments negotiated under paragraphs (2) and (3), 

15 the Copyright Royalty Judges shall commence a 

16 proceeding pursuant to chapter 8 to determine 

17 and publish in the Federal Register a schedule 

18 of reasonable rates and terms which, subject to 

19 paragraph (5), shall be binding on all copyright 

20 owners of sound recordings and transmitting 

21 organizations entitled to a statutory license 

22 under this subsection during the 5-year period 

23 specified in paragraph (3), or such other period 

24 as the parties may agree.’’; 
49

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1 (B) by striking ‘‘copyright arbitration roy2 alty panel’’ each subsequent place it appears 

3 and inserting ‘‘Copyright Royalty Judges’’; 

4 (C) in the fourth sentence, by striking ‘‘its 

5 decision’’ and inserting ‘‘their decision’’; and 

6 (D) in the last sentence, by striking ‘‘Li7 brarian of Congress’’ and inserting ‘‘Copyright 

8 Royalty Judges’’; 

9 (3) in paragraph (5), by striking ‘‘or decision 

10 by the Librarian of Congress’’ and inserting ‘‘, deci11 sion by the Librarian of Congress, or determination 

12 by the Copyright Royalty Judges’’;

13 (4) by striking paragraph (6) and redesignating 

14 paragraphs (7), (8), and (9), as paragraphs (6), (7), 

15 and (8), respectively; and 

16 (5) in paragraph (6)(A), as so redesignated, by 

17 striking ‘‘Librarian of Congress’’ and inserting 

18 ‘‘Copyright Royalty Judges’’. 

19 (c) SCOPE OF EXCLUSIVE RIGHTS IN SOUND RE20 CORDINGS.—Section 114(f) is amended—

21 (1) in paragraph (1)—

22 (A) in subparagraph (A)—

23 (i) by amending the first sentence to 

24 read as follows: ‘‘Voluntary negotiation 

25 proceedings initiated pursuant to section 
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1 804(a) for the purpose of determining rea2 sonable terms and rates of royalty pay3 ments for subscription transmissions by 

4 preexisting subscription services and trans5 missions by preexisting satellite digital 

6 audio radio services shall cover the 5-year 

7 period beginning on January 1 of the year 

8 following the second year in which the pro9 ceedings are commenced, except where dif10 ferential transitional periods are provided 

11 in section 804(b)(3), or such other period 

12 as the parties may agree.’’; and 

13 (ii) in the third sentence, by striking 

14 ‘‘Librarian of Congress’’ and inserting 

15 ‘‘Copyright Royalty Judges’’; 

16 (B) in subparagraph (B)—

17 (i) by amending the first sentence to 

18 read as follows: ‘‘In the absence of license 

19 agreements negotiated under subparagraph 

20 (A), the Copyright Royalty Judges shall 

21 commence a proceeding pursuant to chap22 ter 8 to determine and publish in the Fed23 eral Register a schedule of rates and terms 

24 which, subject to paragraph (3), shall be 

25 binding on all copyright owners of sound 
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1 recordings and entities performing sound 

2 recordings affected by this paragraph dur3 ing the 5-year period specified in subpara4 graph (A), or such other date as the par5 ties may agree.’’; and 

6 (ii) in the second sentence, by striking 

7 ‘‘copyright arbitration royalty panel’’ and 

8 inserting ‘‘Copyright Royalty Judges’’; and

9 (C) by amending subparagraph (C) to read 

10 as follows: 

11 ‘‘(C) The procedures under subparagraphs (A) 

12 and (B) also shall be initiated pursuant to a petition 

13 filed by any copyright owners of sound recordings, 

14 any preexisting subscription services, or any pre15 existing satellite digital audio radio services indi16 cating that a new type of subscription digital audio 

17 transmission service on which sound recordings are 

18 performed is or is about to become operational, for 

19 the purpose of determining reasonable terms and 

20 rates of royalty payments with respect to such new 

21 type of transmission service for the period beginning 

22 with the inception of such new type of service and 

23 ending on the date on which the royalty rates and 

24 terms for subscription digital audio transmission 

25 services most recently determined under subpara-
52

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1 graph (A) or (B) and chapter 8 expire, or such other 

2 period as the parties may agree.’’; 

3 (2) in paragraph (2)—

4 (A) in subparagraph (A)—

5 (i) by amending the first sentence to 

6 read as follows: ‘‘Voluntary negotiation 

7 proceedings initiated pursuant to section 

8 804(a) for the purpose of determining rea9 sonable terms and rates of royalty pay10 ments for public performances of sound re11 cordings by means of eligible nonsubscrip12 tion transmissions and transmissions by 

13 new subscription services specified by sub14 section (d)(2) shall cover the 5-year period 

15 beginning on January 1 of the second year 

16 following the year in which the proceedings 

17 are commenced, except where different 

18 transitional periods are provided in section 

19 804(b)(3)(A), or such other period as the 

20 parties may agree.’’; and 

21 (ii) in the third sentence, by striking 

22 ‘‘Librarian of Congress’’ and inserting 

23 ‘‘Copyright Royalty Judges’’; 

24 (B) in subparagraph (B)—
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1 (i) by amending the first sentence to 

2 read as follows: ‘‘In the absence of license 

3 agreements negotiated under subparagraph 

4 (A), the Copyright Royalty Judges shall 

5 commence a proceeding pursuant to chap6 ter 8 to determine and publish in the Fed7 eral Register a schedule of rates and terms 

8 which, subject to paragraph (3), shall be 

9 binding on all copyright owners of sound 

10 recordings and entities performing sound 

11 recordings affected by this paragraph dur12 ing the period specified in subparagraph 

13 (A), or such other period as the parties 

14 may agree.’’; and 

15 (ii) by striking ‘‘copyright arbitration 

16 royalty panel’’ each subsequent place it ap17 pears and inserting ‘‘Copyright Royalty 

18 Judges’’; and

19 (C) by amending subparagraph (C) to read 

20 as follows: 

21 ‘‘(C) The procedures under subparagraphs (A) 

22 and (B) shall also be initiated pursuant to a petition 

23 filed by any copyright owners of sound recordings or 

24 any eligible nonsubscription service or new subscrip25 tion service indicating that a new type of eligible 
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•HR 1417 RS 

1 nonsubscription service or new subscription service 

2 on which sound recordings are performed is or is 

3 about to become operational, for the purpose of de4 termining reasonable terms and rates of royalty pay5 ments with respect to such new type of service for 

6 the period beginning with the inception of such new 

7 type of service and ending on the date on which the 

8 royalty rates and terms for preexisting subscription 

9 digital audio transmission services or preexisting sat10 ellite digital radio audio services, as the case may be, 

11 most recently determined under subparagraph (A) or 

12 (B) and chapter 8 expire, or such other period as 

13 the parties may agree.’’;

14 (3) in paragraph (3), by striking ‘‘or decision 

15 by the Librarian of Congress’’ and inserting ‘‘, deci16 sion by the Librarian of Congress, or determination 

17 by the Copyright Royalty Judges’’; and 

18 (4) in paragraph (4), by striking ‘‘Librarian of 

19 Congress’’ each place it appears and inserting 

20 ‘‘Copyright Royalty Judges’’.

21 (d) PHONORECORDS OF NONDRAMATIC MUSICAL

22 WORKS.—Section 115(c)(3) is amended—

23 (1) in subparagraph (A)(ii), by striking ‘‘(F)’’ 

24 and inserting ‘‘(E)’’; 

25 (2) in subparagraph (B)—
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•HR 1417 RS 

1 (A) by striking ‘‘under this paragraph’’ 

2 and inserting ‘‘under this section’’; and 

3 (B) by striking ‘‘subparagraphs (B) 

4 through (F)’’ and inserting ‘‘this subparagraph 

5 and subparagraphs (B) through (E)’’; 

6 (3) in subparagraph (C)—

7 (A) by amending the first sentence to read 

8 as follows: ‘‘Voluntary negotiation proceedings 

9 initiated pursuant to a petition filed under sec10 tion 804(a) for the purpose of determining rea11 sonable terms and rates of royalty payments for 

12 the activities specified by this section shall 

13 cover the period beginning with the effective 

14 date of such terms and rates, but not earlier 

15 than January 1 of the second year following the 

16 year in which the petition is filed, and ending 

17 on the effective date of successor terms and 

18 rates, or such other period as the parties may 

19 agree.’’; and 

20 (B) in the third sentence, by striking ‘‘Li21 brarian of Congress’’ and inserting ‘‘Copyright 

22 Royalty Judges’’; 

23 (4) in subparagraph (D)—

24 (A) by amending the first sentence to read 

25 as follows: ‘‘In the absence of license agree-
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•HR 1417 RS 

1 ments negotiated under subparagraphs (B) and 

2 (C), the Copyright Royalty Judges shall com3 mence proceedings pursuant to chapter 8 to de4 termine and publish in the Federal Register a 

5 schedule of rates and terms which, subject to 

6 subparagraph (E), shall be binding on all copy7 right owners of nondramatic musical works and 

8 persons entitled to obtain a compulsory license 

9 under subsection (a)(1) during the period speci10 fied in subparagraph (C) or such other period 

11 as may be determined pursuant to subpara12 graphs (B) and (C), or such other period as the 

13 parties may agree.’’; 

14 (B) in the third sentence, by striking 

15 ‘‘copyright arbitration royalty panel’’ and in16 serting ‘‘Copyright Royalty Judges’’; and 

17 (C) in the last sentence, by striking ‘‘Li18 brarian of Congress’’ and inserting ‘‘Copyright 

19 Royalty Judges’’; 

20 (5) in subparagraph (E)—

21 (A) in clause (i)—

22 (i) in the first sentence, by striking 

23 ‘‘the Librarian of Congress’’ and inserting 

24 ‘‘a copyright arbitration royalty panel, the 
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•HR 1417 RS 

1 Librarian of Congress, or the Copyright 

2 Royalty Judges’’; and 

3 (ii) in the second sentence, by striking 

4 ‘‘(C), (D) or (F) shall be given effect’’ and 

5 inserting ‘‘(C) or (D) shall be given effect 

6 as to digital phonorecord deliveries’’; and 

7 (B) in clause (ii)(I), by striking ‘‘(C), (D) 

8 or (F)’’ each place it appears and inserting 

9 ‘‘(C) or (D)’’; and

10 (6) by striking subparagraph (F) and redesig11 nating subparagraphs (G) through (L) as subpara12 graphs (F) through (K), respectively.

13 (e) COIN-OPERATED PHONORECORD PLAYERS.—Sec14 tion 116 is amended—

15 (1) in subsection (b), by amending paragraph 

16 (2) to read as follows: 

17 ‘‘(2) CHAPTER 8 PROCEEDING.—Parties not 

18 subject to such a negotiation may have the terms 

19 and rates and the division of fees described in para20 graph (1) determined in a proceeding in accordance 

21 with the provisions of chapter 8.’’; and 

22 (2) in subsection (c)—

23 (A) in the subsection heading, by striking 

24 ‘‘COPYRIGHT ARBITRATION ROYALTY PANEL

25 DETERMINATIONS’’ and inserting ‘‘DETER-
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•HR 1417 RS 

1 MINATIONS BY COPYRIGHT ROYALTY JUDGES’’; 

2 and 

3 (B) by striking ‘‘a copyright arbitration 

4 royalty panel’’ and inserting ‘‘the Copyright 

5 Royalty Judges’’. 

6 (f) USE OF CERTAIN WORKS IN CONNECTION WITH

7 NONCOMMERCIAL BROADCASTING.—Section 118 is 

8 amended—

9 (1) in subsection (b)—

10 (A) in paragraph (1)—

11 (i) in the first sentence, by striking 

12 ‘‘Librarian of Congress’’ and inserting 

13 ‘‘Copyright Royalty Judges’’; and 

14 (ii) by striking the second and third 

15 sentences; 

16 (B) in paragraph (2), by striking ‘‘the Li17 brarian of Congress:’’ and all that follows 

18 through the end of the sentence and inserting 

19 ‘‘a copyright arbitration royalty panel, the Li20 brarian of Congress, or the Copyright Royalty 

21 Judge, if copies of such agreements are filed 

22 with the Copyright Royalty Judges within 30 

23 days of execution in accordance with regulations 

24 that the Copyright Royalty Judges shall issue.’’; 

25 and
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1 (C) in paragraph (3)—

2 (i) in the second sentence—

3 (I) by striking ‘‘copyright arbi4 tration royalty panel’’ and inserting 

5 ‘‘Copyright Royalty Judges’’; and

6 (II) by striking ‘‘paragraph (2).’’ 

7 and inserting ‘‘paragraph (2) or (3).’’; 

8 (ii) in the last sentence, by striking 

9 ‘‘‘Librarian of Congress’’ and inserting 

10 ‘‘Copyright Royalty Judges’’; and 

11 (iii) by striking ‘‘(3) In’’ and all that 

12 follows through the end of the first sen13 tence and inserting the following: 

14 ‘‘(3) Voluntary negotiation proceedings initiated 

15 pursuant to a petition filed under section 804(a) for 

16 the purpose of determining a schedule of terms and 

17 rates of royalty payments by public broadcasting en18 tities to copyright owners in works specified by this 

19 subsection and the proportionate division of fees 

20 paid among various copyright owners shall cover the 

21 5-year period beginning on January 1 of the second 

22 year following the year in which the petition is filed. 

23 The parties to each negotiation proceeding shall bear 

24 their own costs. 
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•HR 1417 RS 

1 ‘‘(4) In the absence of license agreements nego2 tiated under paragraph (2) or (3), the Copyright 

3 Royalty Judges shall, pursuant to chapter 8, con4 duct a proceeding to determine and publish in the 

5 Federal Register a schedule of rates and terms 

6 which, subject to paragraph (2), shall be binding on 

7 all owners of copyright in works specified by this 

8 subsection and public broadcasting entities, regard9 less of whether such copyright owners have sub10 mitted proposals to the Copyright Royalty Judges.’’;

11 (2) by striking subsection (c) and redesignating 

12 subsections (d) through (g) as subsections (c) 

13 through (f), respectively; 

14 (3) in subsection (c), as so redesignated, in the 

15 matter preceding paragraph (1)—

16 (A) by striking ‘‘(b)(2)’’ and inserting 

17 ‘‘(b)(2) or (3)’’; 

18 (B) by striking ‘‘(b)(3)’’ and inserting 

19 ‘‘(b)(4)’’; and 

20 (C) by striking ‘‘a copyright arbitration 

21 royalty panel’’ and inserting ‘‘the Copyright 

22 Royalty Judges’’; 

23 (4) in subsection (d), as so redesignated—
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•HR 1417 RS 

1 (A) by striking ‘‘in the Copyright Office’’ 

2 and inserting ‘‘with the Copyright Royalty 

3 Judges’’; and 

4 (B) by striking ‘‘Register of Copyrights’’ 

5 and inserting ‘‘Copyright Royalty Judges’’; and 

6 (5) in subsection (f), as so redesignated, by 

7 striking ‘‘(d)’’ and inserting ‘‘(c)’’. 

8 (g) SECONDARY TRANSMISSIONS BY SATELLITE CAR9 RIERS.—Section 119(b) is amended—

10 (1) in paragraph (3), by striking ‘‘Librarian of 

11 Congress’’ and inserting ‘‘Copyright Royalty 

12 Judges’’; and 

13 (2) in paragraph (4)—

14 (A) in subparagraph (A), by striking ‘‘Li15 brarian of Congress’’ each place it appears and 

16 inserting ‘‘Copyright Royalty Judges’’; and 

17 (B) by amending subparagraphs (B) and 

18 (C) to read as follows: 

19 ‘‘(B) DETERMINATION OF CONTROVERSY; 

20 DISTRIBUTIONS.—After the first day of August 

21 of each year, the Copyright Royalty Judges 

22 shall determine whether there exists a con23 troversy concerning the distribution of royalty 

24 fees. If the Copyright Royalty Judges determine 

25 that no such controversy exists, the Librarian 
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•HR 1417 RS 

1 of Congress shall, after deducting reasonable 

2 administrative costs under this paragraph, dis3 tribute such fees to the copyright owners enti4 tled to receive them, or to their designated 

5 agents. If the Copyright Royalty Judges find 

6 the existence of a controversy, the Copyright 

7 Royalty Judges shall, pursuant to chapter 8 of 

8 this title, conduct a proceeding to determine the 

9 distribution of royalty fees. 

10 ‘‘(C) WITHHOLDING OF FEES DURING

11 CONTROVERSY.—During the pendency of any 

12 proceeding under this subsection, the Copyright 

13 Royalty Judges shall withhold from distribution 

14 an amount sufficient to satisfy all claims with 

15 respect to which a controversy exists, subject to 

16 any distributions made under section 

17 801(b)(3).’’.

18 (h) DIGITAL AUDIO RECORDING DEVICES.—

19 (1) ROYALTY PAYMENTS.—Section 1004(a)(3) 

20 is amended by striking ‘‘Librarian of Congress’’ 

21 each place it appears and inserting ‘‘Copyright Roy22 alty Judges’’.

23 (2) ENTITLEMENT TO ROYALTY PAYMENTS.—

24 Section 1006(c) is amended by striking ‘‘Librarian 

25 of Congress shall convene a copyright arbitration 
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•HR 1417 RS 

1 royalty panel which’’ and inserting ‘‘Copyright Roy2 alty Judges’’. 

3 (3) PROCEDURES FOR DISTRIBUTING ROYALTY

4 PAYMENTS.—Section 1007 is amended—

5 (A) in subsection (a), by amending para6 graph (1) to read as follows: 

7 ‘‘(1) FILING OF CLAIMS.—During the first 2 

8 months of each calendar year, every interested copy9 right party seeking to receive royalty payments to 

10 which such party is entitled under section 1006 shall 

11 file with the Copyright Royalty Judges a claim for 

12 payments collected during the preceding year in such 

13 form and manner as the Copyright Royalty Judges 

14 shall prescribe by regulation.’’; and 

15 (B) by amending subsections (b) and (c) to 

16 read as follows: 

17 ‘‘(b) DISTRIBUTION OF PAYMENTS IN THE ABSENCE

18 OF A DISPUTE.—After the period established for the filing 

19 of claims under subsection (a), in each year, the Copyright 

20 Royalty Judges shall determine whether there exists a con21 troversy concerning the distribution of royalty payments 

22 under section 1006(c). If the Copyright Royalty Judges 

23 determine that no such controversy exists, the Librarian 

24 of Congress shall, within 30 days after such determina25 tion, authorize the distribution of the royalty payments as 
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•HR 1417 RS 

1 set forth in the agreements regarding the distribution of 

2 royalty payments entered into pursuant to subsection (a). 

3 The Librarian of Congress shall, before such royalty pay4 ments are distributed, deduct the reasonable administra5 tive costs incurred by the Librarian under this section.

6 ‘‘(c) RESOLUTION OF DISPUTES.—If the Copyright 

7 Royalty Judges find the existence of a controversy, the 

8 Copyright Royalty Judges shall, pursuant to chapter 8 of 

9 this title, conduct a proceeding to determine the distribu10 tion of royalty payments. During the pendency of such a 

11 proceeding, the Copyright Royalty Judges shall withhold 

12 from distribution an amount sufficient to satisfy all claims 

13 with respect to which a controversy exists, but shall, to 

14 the extent feasible, authorize the distribution of any 

15 amounts that are not in controversy. The Librarian of 

16 Congress shall, before such royalty payments are distrib17 uted, deduct the reasonable administrative costs incurred 

18 by the Librarian under this section.’’. 

19 (4) DETERMINATION OF CERTAIN DISPUTES.—

20 (A) Section 1010 is amended to read as follows: 

21 ‘‘§ 1010. Determination of certain disputes 

22 ‘‘(a) SCOPE OF DETERMINATION.—Before the date 

23 of first distribution in the United States of a digital audio 

24 recording device or a digital audio interface device, any 

25 party manufacturing, importing, or distributing such de-
65

•HR 1417 RS 

1 vice, and any interested copyright party may mutually 

2 agree to petition the Copyright Royalty Judges to deter3 mine whether such device is subject to section 1002, or 

4 the basis on which royalty payments for such device are 

5 to be made under section 1003. 

6 ‘‘(b) INITIATION OF PROCEEDINGS.—The parties 

7 under subsection (a) shall file the petition with the Copy8 right Royalty Judges requesting the commencement of a 

9 proceeding. Within 2 weeks after receiving such a petition, 

10 the Chief Copyright Royalty Judge shall cause notice to 

11 be published in the Federal Register of the initiation of 

12 the proceeding. 

13 ‘‘(c) STAY OF JUDICIAL PROCEEDINGS.—Any civil 

14 action brought under section 1009 against a party to a 

15 proceeding under this section shall, on application of one 

16 of the parties to the proceeding, be stayed until completion 

17 of the proceeding. 

18 ‘‘(d) PROCEEDING.—The Copyright Royalty Judges 

19 shall conduct a proceeding with respect to the matter con20 cerned, in accordance with such procedures as the Copy21 right Royalty Judges may adopt. The Copyright Royalty 

22 Judges shall act on the basis of a fully documented written 

23 record. Any party to the proceeding may submit relevant 

24 information and proposals to the Copyright Royalty 
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•HR 1417 RS 

1 Judges. The parties to the proceeding shall each bear their 

2 respective costs of participation. 

3 ‘‘(e) JUDICIAL REVIEW.—Any determination of the 

4 Copyright Royalty Judges under subsection (d) may be 

5 appealed, by a party to the proceeding, in accordance with 

6 section 803(d) of this title. The pendency of an appeal 

7 under this subsection shall not stay the determination of 

8 the Copyright Royalty Judges. If the court modifies the 

9 determination of the Copyright Royalty Judges, the court 

10 shall have jurisdiction to enter its own decision in accord11 ance with its final judgment. The court may further vacate 

12 the determination of the Copyright Royalty Judges and 

13 remand the case for proceedings as provided in this sec14 tion.’’. 

15 (B) The item relating to section 1010 in the 

16 table of sections for chapter 10 is amended to read 

17 as follows:

‘‘1010. Determination of certain disputes.’’.

18 SEC. 6. EFFECTIVE DATE AND TRANSITION PROVISIONS. 

19 (a) EFFECTIVE DATE.—This Act and the amend20 ments made by this Act shall take effect 6 months after 

21 the date of the enactment of this Act, except that the Li22 brarian of Congress shall appoint interim Copyright Roy23 alty Judges under section 802(d) of title 17, United States 

24 Code, as amended by this Act, within 90 days after such 

25 date of enactment to carry out the functions of the Copy-
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1 right Royalty Judges under title 17, United States Code, 

2 to the extent that Copyright Royalty Judges provided for 

3 in section 801(a) of title 17, United States Code, as 

4 amended by this Act, have not been appointed before the 

5 end of that 90-day period. 

6 (b) TRANSITION PROVISIONS.—

7 (1) IN GENERAL.—Subject to paragraph (2), 

8 the amendments made by this Act shall not affect 

9 any proceedings commenced, petitions filed, or vol10 untary agreements entered into before the enact11 ment of this Act under the provisions of title 17, 

12 United States Code, amended by this Act, and pend13 ing on such date of enactment. Such proceedings 

14 shall continue, determinations made in such pro15 ceedings, and appeals taken therefrom, as if this Act 

16 had not been enacted, and shall continue in effect 

17 until modified under title 17, United States Code, as 

18 amended by this Act. Such petitions filed and vol19 untary agreements entered into shall remain in ef20 fect as if this Act had not been enacted. 

21 (2) EFFECTIVE PERIODS FOR CERTAIN RATE22 MAKING PROCEEDINGS.—Notwithstanding paragraph 

23 (1), terms and rates in effect under section 

24 114(f)(2) or 112(e) of title 17, United States Code, 

25 for new subscription services, eligible nonsubscrip-
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•HR 1417 RS 

1 tion services, and services exempt under section 

2 114(d)(1)(C)(iv) of such title for the period 2003 

3 through 2004, and any rates published in the Fed4 eral Register under the authority of the Small 

5 Webcaster Settlement Act of 2002 for the years 

6 2003 through 2004, shall be effective until the first 

7 applicable effective date for successor terms and 

8 rates specified in section 804(b)(2) or (3)(A) of title 

9 17, United States Code, or until such later date as 

10 the parties may agree. Any proceeding commenced 

11 before the enactment of this Act pursuant to section 

12 114(f)(2) and chapter 8 of title 17, United States 

13 Code, to adjust or determine such rates and terms 

14 for periods following 2004 shall be terminated upon 

15 the enactment of this Act and shall be null and void. 

16 (c) EXISTING APPROPRIATIONS.—Any funds made 

17 available in an appropriations Act before the date of the 

18 enactment of this Act to carry out chapter 8 of title 17, 

19 United States Code, shall be available to the extent nec20 essary to carry out this section.

21 SECTION 1. SHORT TITLE. 

22 This Act may be cited as the ‘‘Copyright Royalty and 

23 Distribution Reform Act of 2004’’. 
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1 SEC. 2. REFERENCE. 

2 Except as otherwise expressly provided, whenever in 

3 this Act an amendment or repeal is expressed in terms of 

4 an amendment to, or repeal of, a section or other provision, 

5 the reference shall be considered to be made to a section or 

6 other provision of title 17, United States Code. 

7 SEC. 3. COPYRIGHT ROYALTY JUDGE AND STAFF. 

8 (a) IN GENERAL.—Chapter 8 is amended to read as 

9 follows: 

10 ‘‘CHAPTER 8—PROCEEDINGS BY 

11 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.

12 ‘‘§ 801. Copyright Royalty Judges; appointment and 

13 functions 

14 ‘‘(a) APPOINTMENT.—Upon the recommendation of the 

15 Register of Copyrights, the Librarian of Congress shall ap16 point 3 full-time Copyright Royalty Judges, and shall ap17 point 1 of the 3 as the Chief Copyright Royalty Judge. 

18 ‘‘(b) FUNCTIONS.—Subject to the provisions of this 

19 chapter, the functions of the Copyright Royalty Judges shall 

20 be as follows: 

21 ‘‘(1) To make determinations and adjustments of 

22 reasonable terms and rates of royalty payments as 
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•HR 1417 RS 

1 provided in sections 112(e), 114, 115, 116, 118, 119 

2 and 1004. The rates applicable under sections 

3 114(f)(1)(B), 115, and 116 shall be calculated to 

4 achieve the following objectives: 

5 ‘‘(A) To maximize the availability of cre6 ative works to the public. 

7 ‘‘(B) To afford the copyright owner a fair 

8 return for his or her creative work and the copy9 right user a fair income under existing economic 

10 conditions. 

11 ‘‘(C) To reflect the relative roles of the copy12 right owner and the copyright user in the prod13 uct made available to the public with respect to 

14 relative creative contribution, technological con15 tribution, capital investment, cost, risk, and con16 tribution to the opening of new markets for cre17 ative expression and media for their communica18 tion. 

19 ‘‘(D) To minimize any disruptive impact 

20 on the structure of the industries involved and on 

21 generally prevailing industry practices. 

22 ‘‘(2) To make determinations concerning the ad23 justment of the copyright royalty rates under section 

24 111 solely in accordance with the following provi25 sions: 
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1 ‘‘(A) The rates established by section 

2 111(d)(1)(B) may be adjusted to reflect—

3 ‘‘(i) national monetary inflation or de4 flation; or 

5 ‘‘(ii) changes in the average rates 

6 charged cable subscribers for the basic serv7 ice of providing secondary transmissions to 

8 maintain the real constant dollar level of 

9 the royalty fee per subscriber which existed 

10 as of the date of October 19, 1976, 

11 except that—

12 ‘‘(I) if the average rates charged cable 

13 system subscribers for the basic service of 

14 providing secondary transmissions are 

15 changed so that the average rates exceed na16 tional monetary inflation, no change in the 

17 rates established by section 111(d)(1)(B) 

18 shall be permitted; and

19 ‘‘(II) no increase in the royalty fee 

20 shall be permitted based on any reduction 

21 in the average number of distant signal 

22 equivalents per subscriber. 

23 The Copyright Royalty Judges may consider all 

24 factors relating to the maintenance of such level 

25 of payments, including, as an extenuating factor, 
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•HR 1417 RS 

1 whether the industry has been restrained by sub2 scriber rate regulating authorities from increas3 ing the rates for the basic service of providing 

4 secondary transmissions. 

5 ‘‘(B) In the event that the rules and regula6 tions of the Federal Communications Commis7 sion are amended at any time after April 8, 

8 1976, to permit the carriage by cable systems of 

9 additional television broadcast signals beyond 

10 the local service area of the primary transmitters 

11 of such signals, the royalty rates established by 

12 section 111(d)(1)(B) may be adjusted to insure 

13 that the rates for the additional distant signal 

14 equivalents resulting from such carriage are rea15 sonable in the light of the changes effected by the 

16 amendment to such rules and regulations. In de17 termining the reasonableness of rates proposed 

18 following an amendment of Federal Communica19 tions Commission rules and regulations, the 

20 Copyright Royalty Judges shall consider, among 

21 other factors, the economic impact on copyright 

22 owners and users; except that no adjustment in 

23 royalty rates shall be made under this subpara24 graph with respect to any distant signal equiva25 lent or fraction thereof represented by—
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•HR 1417 RS 

1 ‘‘(i) carriage of any signal permitted 

2 under the rules and regulations of the Fed3 eral Communications Commission in effect 

4 on April 15, 1976, or the carriage of a sig5 nal of the same type (that is, independent, 

6 network, or noncommercial educational) 

7 substituted for such permitted signal; or 

8 ‘‘(ii) a television broadcast signal first 

9 carried after April 15, 1976, pursuant to an 

10 individual waiver of the rules and regula11 tions of the Federal Communications Com12 mission, as such rules and regulations were 

13 in effect on April 15, 1976. 

14 ‘‘(C) In the event of any change in the rules 

15 and regulations of the Federal Communications 

16 Commission with respect to syndicated and 

17 sports program exclusivity after April 15, 1976, 

18 the rates established by section 111(d)(1)(B) may 

19 be adjusted to assure that such rates are reason20 able in light of the changes to such rules and reg21 ulations, but any such adjustment shall apply 

22 only to the affected television broadcast signals 

23 carried on those systems affected by the change. 

24 ‘‘(D) The gross receipts limitations estab25 lished by section 111(d)(1)(C) and (D) shall be 
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1 adjusted to reflect national monetary inflation or 

2 deflation or changes in the average rates charged 

3 cable system subscribers for the basic service of 

4 providing secondary transmissions to maintain 

5 the real constant dollar value of the exemption 

6 provided by such section, and the royalty rate 

7 specified therein shall not be subject to adjust8 ment. 

9 ‘‘(3)(A) To authorize the distribution, under sec10 tions 111, 119, and 1007, of those royalty fees col11 lected under sections 111, 119, and 1005, as the case 

12 may be, to the extent that the Copyright Royalty 

13 Judges have found that the distribution of such fees 

14 is not subject to controversy. 

15 ‘‘(B) In cases where the Copyright Royalty 

16 Judges determine that controversy exists, the Copy17 right Royalty Judges shall determine the distribution 

18 of such fees, including partial distributions, in ac19 cordance with section 111, 119, or 1007, as the case 

20 may be. 

21 ‘‘(C) The Copyright Royalty Judges may make a 

22 partial distribution of such fees during the pendency 

23 of the proceeding under subparagraph (B) if all par24 ticipants under section 803(b)(2) in the proceeding 
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•HR 1417 RS 

1 that are entitled to receive those fees that are to be 

2 partially distributed—

3 ‘‘(i) agree to such partial distribution; 

4 ‘‘(ii) sign an agreement obligating them to 

5 return any excess amounts to the extent nec6 essary to comply with the final determination on 

7 the distribution of the fees made under subpara8 graph (B); 

9 ‘‘(iii) file the agreement with the Copyright 

10 Royalty Judges; and 

11 ‘‘(iv) agree that such funds are available for 

12 distribution. 

13 ‘‘(D) The Copyright Royalty Judges and any 

14 other officer or employee acting in good faith in dis15 tributing funds under subparagraph (C) shall not be 

16 held liable for the payment of any excess fees under 

17 subparagraph (C). The Copyright Royalty Judges 

18 shall, at the time the final determination is made, 

19 calculate any such excess amounts. 

20 ‘‘(4) To accept or reject royalty claims filed 

21 under sections 111, 119, and 1007, on the basis of 

22 timeliness or the failure to establish the basis for a 

23 claim. 
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1 ‘‘(5) To accept or reject rate adjustment petitions 

2 as provided in section 804 and petitions to partici3 pate as provided in section 803(b) (1) and (2). 

4 ‘‘(6) To determine the status of a digital audio 

5 recording device or a digital audio interface device 

6 under sections 1002 and 1003, as provided in section 

7 1010. 

8 ‘‘(7)(A) To adopt as a basis for statutory terms 

9 and rates or as a basis for the distribution of statu10 tory royalty payments, an agreement concerning such 

11 matters reached among some or all of the participants 

12 in a proceeding at any time during the proceeding, 

13 except that—

14 ‘‘(i) the Copyright Royalty Judges shall 

15 provide to those that would be bound by the 

16 terms, rates, distribution, or other determination 

17 set by the agreement an opportunity to comment 

18 on the agreement and shall provide to the other 

19 participants in the proceeding under section 

20 803(b)(2) that would be bound by the terms, 

21 rates, distribution, or other determination set by 

22 the agreement an opportunity to comment on the 

23 agreement and object to its adoption as a basis 

24 for statutory terms and rates or as a basis for 
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•HR 1417 RS 

1 the distribution of statutory royalty payments, 

2 as the case may be; and

3 ‘‘(ii) the Copyright Royalty Judges may de4 cline to adopt the agreement as a basis for statu5 tory terms and rates or as a basis for the dis6 tribution of statutory royalty payments, as the 

7 case may be, if any other participant described 

8 in subparagraph (A) objects to the agreement 

9 and the Copyright Royalty Judges conclude, 

10 based on the record before them if one exists, that 

11 the agreement does not provide a reasonable 

12 basis for setting statutory terms or rates, or for 

13 distributing the royalty payments, as the case 

14 may be.

15 ‘‘(B) License agreements voluntarily negotiated 

16 pursuant to section 112(e)(5), 114(f)(3), 

17 115(c)(3)(E)(i), 116(c), or 118(b) (2) or (3) that do 

18 not result in statutory terms and rates shall not be 

19 subject to clauses (i) and (ii) of subparagraph (A). 

20 ‘‘(C) Interested parties may negotiate and agree 

21 to, and the Copyright Royalty Judges may adopt, an 

22 agreement that specifies as terms notice and record23 keeping requirements that apply in lieu of those that 

24 would otherwise apply under regulations. 
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1 ‘‘(8) To perform other duties, as assigned by the 

2 Register of Copyrights within the Library of Con3 gress, except as provided in section 802(g) at times 

4 when Copyright Royalty Judges are not engaged in 

5 performing the other duties set forth in this section. 

6 ‘‘(c) RULINGS.—As provided in section 802(f)(1), the 

7 Copyright Royalty Judges may make any necessary proce8 dural or evidentiary rulings in any proceeding under this 

9 chapter and may, before commencing a proceeding under 

10 this chapter, make any such rulings that would apply to 

11 the proceedings conducted by the Copyright Royalty Judges.

12 ‘‘(d) ADMINISTRATIVE SUPPORT.—The Librarian of 

13 Congress shall provide the Copyright Royalty Judges with 

14 the necessary administrative services related to proceedings 

15 under this chapter. 

16 ‘‘(e) LOCATION IN LIBRARY OF CONGRESS.—The offices 

17 of the Copyright Royalty Judges and staff shall be in the 

18 Library of Congress. 

19 ‘‘§ 802. Copyright Royalty Judgeships; staff 

20 ‘‘(a) QUALIFICATIONS OF COPYRIGHT ROYALTY

21 JUDGES.—

22 ‘‘(1) IN GENERAL.—Each Copyright Royalty 

23 Judge shall be an attorney who has at least 7 years 

24 of legal experience. The Chief Copyright Royalty 

25 Judge shall have at least 5 years of experience in ad-
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1 judications, arbitrations, or court trials. Of the other 

2 two Copyright Royalty Judges, one shall have signifi3 cant knowledge of copyright law, and the other shall 

4 have significant knowledge of economics. An indi5 vidual may serve as a Copyright Royalty Judge only 

6 if the individual is free of any financial conflict of 

7 interest under subsection (h). 

8 ‘‘(2) DEFINITION.—In this subsection, the term 

9 ‘adjudication’ has the meaning given that term in 

10 section 551 of title 5, but does not include mediation. 

11 ‘‘(b) STAFF.—The Chief Copyright Royalty Judge 

12 shall hire 3 full-time staff members to assist the Copyright 

13 Royalty Judges in performing their functions. 

14 ‘‘(c) TERMS.—The terms of the Copyright Royalty 

15 Judges shall each be 6 years, except of the individuals first 

16 appointed, the Chief Copyright Royalty Judge shall be ap17 pointed to a term of 6 years, and of the remaining Copy18 right Royalty Judges, one shall be appointed to a term of 

19 2 years, and the other shall be appointed to a term of 4 

20 years. An individual serving as a Copyright Royalty Judge 

21 may be reappointed to subsequent terms. The term of a 

22 Copyright Royalty Judge shall begin when the term of the 

23 predecessor of that Copyright Royalty Judge ends. When the 

24 term of office of a Copyright Royalty Judge ends, the indi-
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1 vidual serving that term may continue to serve until a suc2 cessor is selected. 

3 ‘‘(d) VACANCIES OR INCAPACITY.—

4 ‘‘(1) VACANCIES.—If a vacancy should occur in 

5 the position of Copyright Royalty Judge, the Librar6 ian of Congress shall act expeditiously to fill the va7 cancy, and may appoint an interim Copyright Roy8 alty Judge to serve until another Copyright Royalty 

9 Judge is appointed under this section. An individual 

10 appointed to fill the vacancy occurring before the ex11 piration of the term for which the predecessor of that 

12 individual was appointed shall be appointed for the 

13 remainder of that term. 

14 ‘‘(2) INCAPACITY.—In the case in which a Copy15 right Royalty Judge is temporarily unable to perform 

16 his or her duties, the Librarian of Congress may ap17 point an interim Copyright Royalty Judge to perform 

18 such duties during the period of such incapacity. 

19 ‘‘(e) COMPENSATION.—

20 ‘‘(1) JUDGES.—The Chief Copyright Royalty 

21 Judge shall receive compensation at the rate of basic 

22 pay payable for level AL–1 for administrative law 

23 judges pursuant to section 5372(b) of title 5, and each 

24 of the other two Copyright Royalty Judges shall re25 ceive compensation at the rate of basic pay payable 
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1 for level AL–2 for administrative law judges pursuant 

2 to such section. The compensation of the Copyright 

3 Royalty Judges shall not be subject to any regulations 

4 adopted by the Office of Personnel Management pur5 suant to its authority under section 5376(b)(1) of title 

6 5. 

7 ‘‘(2) STAFF MEMBERS.—Of the staff members ap8 pointed under subsection (b)—

9 ‘‘(A) the rate of pay of one staff member 

10 shall be not more than the basic rate of pay pay11 able for level 10 of GS–15 of the General Sched12 ule; 

13 ‘‘(B) the rate of pay of one staff member 

14 shall be not less than the basic rate of pay pay15 able for GS–13 of the General Schedule and not 

16 more than the basic rate of pay payable for level 

17 10 of GS–14 of such Schedule; and 

18 ‘‘(C) the rate of pay for the third staff mem19 ber shall be not less than the basic rate of pay 

20 payable for GS–8 of the General Schedule and 

21 not more than the basic rate of pay payable for 

22 level 10 of GS–11 of such Schedule. 

23 ‘‘(3) LOCALITY PAY.—All rates of pay referred to 

24 under this subsection shall include locality pay. 
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1 ‘‘(f) INDEPENDENCE OF COPYRIGHT ROYALTY

2 JUDGE.—

3 ‘‘(1) IN MAKING DETERMINATIONS.—

4 ‘‘(A) IN GENERAL.—Subject to subpara5 graph (B), the Copyright Royalty Judges shall 

6 have full independence in making determinations 

7 concerning adjustments and determinations of 

8 copyright royalty rates and terms, the distribu9 tion of copyright royalties, the acceptance or re10 jection of royalty claims, rate adjustment peti11 tions, and petitions to participate, and in 

12 issuing other rulings under this title, except that 

13 the Copyright Royalty Judges may consult with 

14 the Register of Copyrights on any matter other 

15 than a question of fact. A Copyright Royalty 

16 Judge or Judges, or by motion to the Copyright 

17 Royalty Judge or Judges, any participant in a 

18 proceeding may request a determination of the 

19 resolution by the Register of Copyrights on any 

20 material question of substantive law (not includ21 ing questions of procedure before the Copyright 

22 Royalty Judges, the ultimate adjustments and 

23 determinations of copyright royalty rates and 

24 terms, the ultimate distribution of copyright roy25 alties, or the acceptance or rejection of royalty 
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1 claims, rate adjustment petitions, or petitions to 

2 participate) concerning an interpretation or con3 struction of those provisions of this title that are 

4 the subject of the proceeding. Any such motion 

5 requesting a written decision by the Register of 

6 Copyrights shall be in writing or on the record, 

7 and reasonable provision shall be made for com8 ment by the participants in the proceeding in 

9 such a way as to minimize duplication and 

10 delay. Except as provided in subparagraph (B), 

11 the Register of Copyrights shall deliver to the 

12 Copyright Royalty Judges his or her decision 

13 within 14 days of receipt by the Register of 

14 Copyrights of all of the briefs or comments of the 

15 participants. Such decision shall be in writing 

16 and shall be included by the Copyright Royalty 

17 Judges in the record that accompanies their final 

18 determination. If such a decision is timely deliv19 ered to the Register of Copyrights, the Copyright 

20 Royalty Judges shall apply the legal determina21 tions embodied in the decision of the Register of 

22 Copyrights in resolving material questions of 

23 substantive law. 

24 ‘‘(B) NOVEL QUESTIONS.—(i) In any case 

25 in which a novel question of law concerning an 
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1 interpretation of those provisions of this title 

2 that are the subject of the proceeding is pre3 sented, the Copyright Royalty Judges shall re4 quest a decision of the Register of Copyrights, in 

5 writing, to resolve such novel question. To the ex6 tent practicable, provision shall be made for 

7 comment on such request by the participants in 

8 the proceeding, in such a way as to minimize 

9 duplication and delay. The Register shall trans10 mit his or her decision to the Copyright Royalty 

11 Judges within 30 days of receipt by the Register 

12 of Copyrights of all of the briefs or comments of 

13 the participants. Such decision shall be in writ14 ing and included by the Copyright Royalty 

15 Judges in the record that accompanies their final 

16 determination. If such a decision is timely trans17 mitted, the Copyright Royalty Judges shall 

18 apply the legal determinations embodied in the 

19 decision of the Register of Copyrights in resolv20 ing material questions of substantive law. 

21 ‘‘(ii) In clause (i), a ‘novel question of law’ 

22 is a question of law that has not been determined 

23 in prior decisions, determinations, and rulings 

24 described in section 803(a). 
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1 ‘‘(C) CONSULTATION.—Notwithstanding the 

2 provisions of subparagraph (A), the Copyright 

3 Royalty Judges shall consult with the Register of 

4 Copyrights with respect to any determination or 

5 ruling that would require that any act be per6 formed by the Copyright Office, and any such de7 termination or ruling shall not be binding upon 

8 the Register of Copyrights. 

9 ‘‘(D) SUA SPONTE REVIEW OF LEGAL CON10 CLUSIONS BY THE REGISTER OF COPYRIGHTS.—

11 The Register of Copyrights may review for legal 

12 error the resolution by the Copyright Royalty 

13 Judges of a material question of substantive law 

14 under this title that underlies or is contained in 

15 a final determination of the Copyright Royalty 

16 Judges. If the Register of Copyrights concludes, 

17 after taking into consideration the views of the 

18 participants in the proceeding, that any resolu19 tion reached by the Copyright Royalty Judges 

20 was in material error, the Register of Copyrights 

21 shall issue a written decision correcting such 

22 legal error, which shall be made part of the 

23 record of the proceeding. Additionally, the Reg24 ister of Copyrights shall cause to be published in 

25 the Federal Register such written decision to-
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1 gether with a specific identification of the legal 

2 conclusion of the Copyright Royalty Judges that 

3 is determined to be erroneous. As to conclusions 

4 of substantive law involving an interpretation of 

5 the statutory provisions of this title, the decision 

6 of the Register of Copyrights shall be binding 

7 upon the Copyright Royalty Judges in subse8 quent proceedings under this chapter. When a 

9 decision has been rendered pursuant to sub10 section 802(f)(1)(D), the Register of Copyrights 

11 may, on the basis of and in accordance with 

12 such decision, intervene as of right in any ap13 peal of a final determination of the Copyright 

14 Royalty Judges pursuant to section 803(d) in the 

15 United States Court of Appeals for the District 

16 of Columbia Circuit. If, prior to intervening in 

17 such an appeal, the Register of Copyrights gives 

18 notification and undertakes to consult with the 

19 Attorney General with respect to such interven20 tion, and the Attorney General fails within rea21 sonable period after receipt of such notification 

22 to intervene in such appeal, the Register of 

23 Copyrights may intervene in such appeal in his 

24 or her own name by any attorney designated by 

25 the Register of Copyrights for such purpose. 
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1 Intervention by the Register of Copyrights in his 

2 or her own name shall not preclude the Attorney 

3 General from intervening on behalf of the United 

4 States in such an appeal as may be otherwise 

5 provided or required by law. 

6 ‘‘(E) EFFECT ON JUDICIAL REVIEW.—Noth7 ing in this section shall be interpreted to alter 

8 the standard applied by a court in reviewing 

9 legal determinations involving an interpretation 

10 or construction of the provisions of this title or 

11 to affect the extent to which any construction or 

12 interpretation of the provisions of this title shall 

13 be accorded deference by a reviewing court. 

14 ‘‘(2) PERFORMANCE APPRAISALS.—

15 ‘‘(A) IN GENERAL.—Notwithstanding any 

16 other provision of law or any regulation of the 

17 Library of Congress, and subject to subpara18 graph (B), the Copyright Royalty Judges shall 

19 not receive performance appraisals. 

20 ‘‘(B) RELATING TO SANCTION OR RE21 MOVAL.—To the extent that the Librarian of 

22 Congress adopts regulations under subsection (h) 

23 relating to the sanction or removal of a Copy24 right Royalty Judge and such regulations re25 quire documentation to establish the cause of 
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1 such sanction or removal, the Copyright Royalty 

2 Judge may receive an appraisal related specifi3 cally to the cause of the sanction or removal. 

4 ‘‘(g) INCONSISTENT DUTIES BARRED.—No Copyright 

5 Royalty Judge may undertake duties that conflict with his 

6 or her duties and responsibilities as a Copyright Royalty 

7 Judge. 

8 ‘‘(h) STANDARDS OF CONDUCT.—The Librarian of 

9 Congress shall adopt regulations regarding the standards 

10 of conduct, including financial conflict of interest and re11 strictions against ex parte communications, which shall 

12 govern the Copyright Royalty Judges and the proceedings 

13 under this chapter. 

14 ‘‘(i) REMOVAL OR SANCTION.—The Librarian of Con15 gress may sanction or remove a Copyright Royalty Judge 

16 for violation of the standards of conduct adopted under sub17 section (h), misconduct, neglect of duty, or any disquali18 fying physical or mental disability. Any such sanction or 

19 removal may be made only after notice and opportunity 

20 for a hearing, but the Librarian of Congress may suspend 

21 the Copyright Royalty Judge during the pendency of such 

22 hearing. The Librarian shall appoint an interim Copyright 

23 Royalty Judge during the period of any such suspension. 

24 ‘‘§ 803. Proceedings of Copyright Royalty Judges 

25 ‘‘(a) PROCEEDINGS.—
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1 ‘‘(1) IN GENERAL.—The Copyright Royalty 

2 Judges shall act in accordance with regulations issued 

3 by the Copyright Royalty Judges and the Librarian 

4 of Congress, and on the basis of a written record, 

5 prior determinations of the Copyright Royalty Tri6 bunal, Librarian of Congress, copyright arbitration 

7 royalty panels, the Register of Copyrights, and the 

8 Copyright Royalty Judges (to the extent those deter9 minations are not inconsistent with a decision of the 

10 Register of Copyrights that was timely delivered pur11 suant to subsection 802(f)(1)(D)), under this chapter, 

12 and decisions of the court of appeals under this chap13 ter before, on, or after the effective date of the Copy14 right Royalty and Distribution Reform Act of 2004. 

15 ‘‘(2) JUDGES ACTING AS PANEL AND INDIVID16 UALLY.—The Copyright Royalty Judges shall preside 

17 over hearings in proceedings under this chapter en 

18 banc. The Chief Copyright Royalty Judge may des19 ignate a Copyright Royalty Judge to preside individ20 ually over such collateral and administrative pro21 ceedings, and over such proceedings under paragraphs 

22 (1) through (5) of subsection (b), as the Chief Judge 

23 considers appropriate. 

24 ‘‘(3) DETERMINATIONS.—Final determinations 

25 of the Copyright Royalty Judges in proceedings under 
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1 this chapter shall be made by majority vote. A Copy2 right Royalty Judge dissenting from the majority on 

3 any determination under this chapter may issue his 

4 or her dissenting opinion, which shall be included 

5 with the determination. 

6 ‘‘(b) PROCEDURES.—

7 ‘‘(1) INITIATION.—

8 ‘‘(A) CALL FOR PETITIONS TO PARTICI9 PATE.—(i) Promptly upon the filing of a peti10 tion for a rate adjustment or upon a determina11 tion made under section 804(a) or as provided 

12 under section 804(b)(8), or by no later than Jan13 uary 5 of a year specified in section 804 for the 

14 commencement of a proceeding if a petition has 

15 not been filed by that date, the Copyright Roy16 alty Judges shall cause to be published in the 

17 Federal Register notice of commencement of pro18 ceedings under this chapter calling for the filing 

19 of petitions to participate in a proceeding under 

20 this chapter for the purpose of making the rel21 evant determination under section 111, 112, 114, 

22 115, 116, 118, 119, 1004, or 1007, as the case 

23 may be. 

24 ‘‘(ii) Petitions to participate shall be filed 

25 by no later than 30 days after publication of no-
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1 tice of commencement of a proceeding, under 

2 clause (i), except that the Copyright Royalty 

3 Judges may, for substantial good cause shown 

4 and if there is no prejudice to the participants 

5 that have already filed petitions, accept late peti6 tions to participate at any time up to the date 

7 that is 90 days before the date on which partici8 pants in the proceeding are to file their written 

9 direct statements. Notwithstanding the preceding 

10 sentence, petitioners whose petitions are filed 

11 more than 30 days after publication of notice of 

12 commencement of a proceeding are not eligible to 

13 object to a settlement reached during the vol14 untary negotiation period under section 

15 803(b)(3), and any objection filed by such a peti16 tioner shall not be taken into account by the 

17 Copyright Royalty Judges. 

18 ‘‘(B) PETITIONS TO PARTICIPATE.—Each 

19 petition to participate in a proceeding shall de20 scribe the petitioner’s interest in the subject mat21 ter of the proceeding. Parties with similar inter22 ests may file a single petition to participate. 

23 ‘‘(2) PARTICIPATION IN GENERAL.—Subject to 

24 paragraph (4), a person may participate in a pro-
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1 ceeding under this chapter, including through the sub2 mission of briefs or other information, only if—

3 ‘‘(A) that person has filed a petition to par4 ticipate in accordance with paragraph (1) (ei5 ther individually or as a group under paragraph 

6 (1)(B)), together with a filing fee of $150; 

7 ‘‘(B) the Copyright Royalty Judges have not 

8 determined that the petition to participate is 

9 facially invalid; and 

10 ‘‘(C) the Copyright Royalty Judges have not 

11 determined, sua sponte or on the motion of an12 other participant in the proceeding, that the per13 son lacks a significant interest in the proceeding. 

14 ‘‘(3) VOLUNTARY NEGOTIATION PERIOD.—

15 ‘‘(A) IN GENERAL.—Promptly after the date 

16 for filing of petitions to participate in a pro17 ceeding, the Copyright Royalty Judges shall 

18 make available to all participants in the pro19 ceeding a list of such participants and shall ini20 tiate a voluntary negotiation period among the 

21 participants. 

22 ‘‘(B) LENGTH OF PROCEEDINGS.—The vol23 untary negotiation period initiated under sub24 paragraph (A) shall be 3 months. 
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1 ‘‘(C) DETERMINATION OF SUBSEQUENT

2 PROCEEDINGS.—At the close of the voluntary ne3 gotiation proceedings, the Copyright Royalty 

4 Judges shall, if further proceedings under this 

5 chapter are necessary, determine whether and to 

6 what extent paragraphs (4) and (5) will apply 

7 to the parties. 

8 ‘‘(4) SMALL CLAIMS PROCEDURE IN DISTRIBU9 TION PROCEEDINGS.—

10 ‘‘(A) IN GENERAL.—If, in a proceeding 

11 under this chapter to determine the distribution 

12 of royalties, a participant in the proceeding as13 serts a claim in the amount of $10,000 or less, 

14 the Copyright Royalty Judges shall decide the 

15 controversy on the basis of the filing of the writ16 ten direct statement by the participant, the re17 sponse by any opposing participant, and 1 addi18 tional response by each such party. The partici19 pant asserting the claim shall not be required to 

20 pay the filing fee under paragraph (2). 

21 ‘‘(B) BAD FAITH INFLATION OF CLAIM.—If 

22 the Copyright Royalty Judges determine that a 

23 participant asserts in bad faith an amount in 

24 controversy in excess of $10,000 for the purpose 

25 of avoiding a determination under the procedure 
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1 set forth in subparagraph (A), the Copyright 

2 Royalty Judges shall impose a fine on that par3 ticipant in an amount not to exceed the dif4 ference between the actual amount distributed 

5 and the amount asserted by the participant. 

6 ‘‘(5) PAPER PROCEEDINGS.—The Copyright Roy7 alty Judges in proceedings under this chapter may 

8 decide, sua sponte or upon motion of a participant, 

9 to determine issues on the basis of the filing of the 

10 written direct statement by the participant, the re11 sponse by any opposing participant, and one addi12 tional response by each such participant. Prior to 

13 making such decision to proceed on such a paper 

14 record only, the Copyright Royalty Judges shall offer 

15 to all parties to the proceeding the opportunity to 

16 comment on the decision. The procedure under this 

17 paragraph—

18 ‘‘(A) shall be applied in cases in which 

19 there is no genuine issue of material fact, there 

20 is no need for evidentiary hearings, and all par21 ticipants in the proceeding agree in writing to 

22 the procedure; and 

23 ‘‘(B) may be applied under such other cir24 cumstances as the Copyright Royalty Judges 

25 consider appropriate. 
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1 ‘‘(6) REGULATIONS.—

2 ‘‘(A) IN GENERAL.—The Copyright Royalty 

3 Judges may issue regulations to carry out their 

4 functions under this title. All regulations issued 

5 by the Copyright Royalty Judges are subject to 

6 the approval of the Librarian of Congress. Not 

7 later than 120 days after Copyright Royalty 

8 Judges or interim Copyright Royalty Judges, as 

9 the case may be, are first appointed after the en10 actment of the Copyright Royalty and Distribu11 tion Reform Act of 2004, such judges shall issue 

12 regulations to govern proceedings under this 

13 chapter. 

14 ‘‘(B) INTERIM REGULATIONS.—Until regu15 lations are adopted under subparagraph (A), the 

16 Copyright Royalty Judges shall apply the regu17 lations in effect under this chapter on the day 

18 before the effective date of the Copyright Royalty 

19 and Distribution Reform Act of 2004, to the ex20 tent such regulations are not inconsistent with 

21 this chapter, except that functions carried out 

22 under such regulations by the Librarian of Con23 gress, the Register of Copyrights, or copyright ar24 bitration royalty panels that, as of such date of 

25 enactment, are to be carried out by the Copy-
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1 right Royalty Judges under this chapter, shall be 

2 carried out by the Copyright Royalty Judges 

3 under such regulations. 

4 ‘‘(C) REQUIREMENTS.—Regulations issued 

5 under subparagraph (A) shall include the fol6 lowing: 

7 ‘‘(i) The written direct statements of 

8 all participants in a proceeding under 

9 paragraph (2) shall be filed by a date speci10 fied by the Copyright Royalty Judges, 

11 which may be no earlier than four months, 

12 and no later than five months, after the end 

13 of the voluntary negotiation period under 

14 paragraph (3). Notwithstanding the pre15 ceding sentence, the Copyright Royalty 

16 Judges may allow a participant in a pro17 ceeding to file an amended written direct 

18 statement based on new information re19 ceived during the discovery process, within 

20 15 days after the end of the discovery period 

21 specified in clause (iii). 

22 ‘‘(ii)(I) Following the submission to 

23 the Copyright Royalty Judges of written di24 rect statements by the participants in a 

25 proceeding under paragraph (2), the judges 
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1 shall meet with the participants for the pur2 pose of setting a schedule for conducting 

3 and completing discovery. Such schedule 

4 shall be determined by the Copyright Roy5 alty Judges. 

6 ‘‘(II) In this chapter, the term ‘written 

7 direct statements’ means witness statements, 

8 testimony, and exhibits to be presented in 

9 the proceedings, and such other information 

10 that is necessary to establish terms and 

11 rates, or the distribution of royalty pay12 ments, as the case may be, as set forth in 

13 regulations issued by the Copyright Royalty 

14 Judges. 

15 ‘‘(iii) Hearsay may be admitted in 

16 proceedings under this chapter to the extent 

17 deemed appropriate by the Copyright Roy18 alty Judges. 

19 ‘‘(iv) Discovery in such proceedings 

20 shall be permitted for a period of 60 days, 

21 except for discovery ordered by the Copy22 right Royalty Judges in connection with the 

23 resolution of motions, orders and disputes 

24 pending at the end of such period. 
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1 ‘‘(v) Any participant under paragraph 

2 (2) in a proceeding under this chapter to 

3 determine royalty rates may request of an 

4 opposing participant nonprivileged docu5 ments directly related to the written direct 

6 statement of that participant. Any objection 

7 to such a request shall be resolved by a mo8 tion or request to compel production made 

9 to the Copyright Royalty Judges according 

10 to regulations adopted by the Copyright 

11 Royalty Judges. Each motion or request to 

12 compel discovery shall be determined by the 

13 Copyright Royalty Judges, or by a Copy14 right Royalty Judge when permitted under 

15 subsection (a)(2). Upon such motion, the 

16 Copyright Royalty Judges may order dis17 covery pursuant to regulations established 

18 under this paragraph. 

19 ‘‘(vi) Any participant under para20 graph (2) in a proceeding under this chap21 ter to determine royalty rates may, upon a 

22 written motion to the Copyright Royalty 

23 Judges, request of an opposing participant 

24 or witness other relevant information and 

25 materials if absent the discovery sought the 
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1 moving party would be prejudiced or the 

2 Copyright Royalty Judges’ resolution of the 

3 proceeding would be substantially impaired. 

4 Absent a showing of substantial good cause 

5 or demonstration of a likelihood of substan6 tial prejudice, no participant in a pro7 ceeding may take more than 3 depositions 

8 and propound more than 10 interrogatories 

9 in that proceeding. Absent such a showing, 

10 the total number of depositions ordered in 

11 such a proceeding shall not exceed 10, and 

12 the total number of interrogatories shall not 

13 exceed 25 in each proceeding. In deter14 mining whether discovery will be granted 

15 under this clause, the Copyright Royalty 

16 Judges may consider—

17 ‘‘(I) whether the information 

18 sought would serve to protect the integ19 rity of the proceeding, to prevent sub20 stantial prejudice to any participant, 

21 or to correct a material misrepresenta22 tion or omission by any participant; 

23 ‘‘(II) whether the burden or ex24 pense of producing the requested infor25 mation or materials outweighs the like-
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1 ly benefit, taking into account the 

2 needs and resources of the participants, 

3 the importance of the issues at stake, 

4 and the probative value of the re5 quested information or materials in re6 solving such issues; 

7 ‘‘(III) whether the requested infor8 mation or materials would be unrea9 sonably cumulative or duplicative, or 

10 are obtainable from another source that 

11 is more convenient, less burdensome, or 

12 less expensive; and 

13 ‘‘(IV) whether the participant 

14 seeking discovery has had ample oppor15 tunity by discovery in the proceeding 

16 or by other means to obtain the infor17 mation sought. 

18 ‘‘(vii) The rules and practices in effect 

19 on the day before the effective date of the 

20 Copyright Royalty and Distribution Reform 

21 Act of 2004, relating to discovery in pro22 ceedings under this chapter to determine the 

23 distribution of royalty fees, shall continue to 

24 apply to such proceedings on and after such 

25 effective date. 
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1 ‘‘(viii) In proceedings to determine 

2 royalty rates, the Copyright Royalty Judges 

3 may issue a subpoena commanding a par4 ticipant or witness in a proceeding to deter5 mine royalty rates to appear and give testi6 mony or to produce and permit inspection 

7 of documents or tangible things if the Copy8 right Royalty Judges’ resolution of the pro9 ceeding would be substantially impaired by 

10 the absence of such testimony or production 

11 of documents or tangible things. Such sub12 poena shall specify with reasonable particu13 larity the materials to be produced or the 

14 scope and nature of the required testimony. 

15 Nothing in this subparagraph shall preclude 

16 the Copyright Royalty Judges from request17 ing the production by a nonparticipant of 

18 information or materials relevant to the res19 olution by the Copyright Royalty Judges of 

20 a material issue of fact. A Copyright Roy21 alty Judge may not issue a subpoena under 

22 this clause to any person who was a partic23 ipant in a proceeding to determine royalty 

24 rates and has negotiated a settlement with 

25 respect to those rates. 
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1 ‘‘(ix) The Copyright Royalty Judges 

2 shall order a settlement conference among 

3 the participants in the proceeding to facili4 tate the presentation of offers of settlement 

5 among the participants. The settlement con6 ference shall be held during a 21-day period 

7 following the end of the discovery period 

8 and shall take place outside the presence of 

9 the Copyright Royalty Judges. 

10 ‘‘(x) No evidence, including exhibits, 

11 may be submitted in the written direct 

12 statement of a participant without a spon13 soring witness, except where the Copyright 

14 Royalty Judges have taken official notice, 

15 or in the case of incorporation by reference 

16 of past records, or for good cause shown. 

17 ‘‘(c) DETERMINATION OF COPYRIGHT ROYALTY

18 JUDGES.—

19 ‘‘(1) TIMING.—The Copyright Royalty Judges 

20 shall issue their determination in a proceeding not 

21 later than 11 months after the conclusion of the 21-

22 day settlement conference period under subsection 

23 (b)(3)(C)(vi), but, in the case of a proceeding to deter24 mine successors to rates or terms that expire on a 

25 specified date, in no event later than 15 days before 
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1 the expiration of the then current statutory rates and 

2 terms. 

3 ‘‘(2) REHEARINGS.—

4 ‘‘(A) IN GENERAL.—The Copyright Royalty 

5 Judges may, in exceptional cases, upon motion 

6 of a participant under subsection (b)(2), order a 

7 rehearing, after the determination in a pro8 ceeding is issued under paragraph (1), on such 

9 matters as the Copyright Royalty Judges deter10 mine to be appropriate. 

11 ‘‘(B) TIMING FOR FILING MOTION.—Any 

12 motion for a rehearing under subparagraph (A) 

13 may only be filed within 15 days after the date 

14 on which the Copyright Royalty Judges deliver 

15 their initial determination concerning rates and 

16 terms to the participants in the proceeding. 

17 ‘‘(C) PARTICIPATION BY OPPOSING PARTY

18 NOT REQUIRED.—In any case in which a rehear19 ing is ordered, any opposing party shall not be 

20 required to participate in the rehearing, except 

21 as provided under subsection (d)(1). 

22 ‘‘(D) NO NEGATIVE INFERENCE.—No nega23 tive inference shall be drawn from lack of par24 ticipation in a rehearing. 
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1 ‘‘(E) CONTINUITY OF RATES AND TERMS.—

2 (i) If the decision of the Copyright Royalty 

3 Judges on any motion for a rehearing is not ren4 dered before the expiration of the statutory rates 

5 and terms that were previously in effect, in the 

6 case of a proceeding to determine successors to 

7 rates and terms that expire on a specified date, 

8 then—

9 ‘‘(I) the initial determination of the 

10 Copyright Royalty Judges that is the sub11 ject of the rehearing motion shall be effective 

12 as of the day following the date on which 

13 the rates and terms that were previously in 

14 effect expire; and 

15 ‘‘(II) in the case of a proceeding under 

16 section 114(f)(1)(C) or 114(f)(2)(C), royalty 

17 rates and terms shall, for purposes of sec18 tion 114(f)(4)(B), be deemed to have been 

19 set at those rates and terms contained in the 

20 initial determination of the Copyright Roy21 alty Judges that is the subject of the rehear22 ing motion, as of the date of that deter23 mination. 

24 ‘‘(ii) The pendency of a motion for a re25 hearing under this paragraph shall not relieve 
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1 persons obligated to make royalty payments who 

2 would be affected by the determination on that 

3 motion from providing the statements of account 

4 and any reports of use, to the extent required, 

5 and paying the royalties required under the rel6 evant determination or regulations. 

7 ‘‘(iii) Notwithstanding clause (ii), whenever 

8 royalties described in clause (ii) are paid to a 

9 person other than the Copyright Office, the entity 

10 designated by the Copyright Royalty Judges to 

11 which such royalties are paid by the copyright 

12 user (and any successor thereto) shall, within 60 

13 days after the motion for rehearing is resolved 

14 or, if the motion is granted, within 60 days after 

15 the rehearing is concluded, return any excess 

16 amounts previously paid to the extent necessary 

17 to comply with the final determination of roy18 alty rates by the Copyright Royalty Judges. 

19 ‘‘(3) CONTENTS OF DETERMINATION.—A deter20 mination of the Copyright Royalty Judges shall be 

21 supported by the written record and shall set forth the 

22 findings of fact relied on by the Copyright Royalty 

23 Judges. Among other terms adopted in a determina24 tion, the Copyright Royalty Judges may specify no25 tice and recordkeeping requirements of users of the 
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1 copyrights at issue that apply in lieu of those that 

2 would otherwise apply under regulations. 

3 ‘‘(4) CONTINUING JURISDICTION.—The Copyright 

4 Royalty Judges may, with the approval of the Reg5 ister of Copyrights, issue an amendment to a written 

6 determination to correct any technical or clerical er7 rors in the determination or to modify the terms, but 

8 not the rates, of royalty payments in response to un9 foreseen circumstances that would frustrate the proper 

10 implementation of such determination. Such amend11 ment shall be set forth in a written addendum to the 

12 determination that shall be distributed to the partici13 pants of the proceeding and shall be published in the 

14 Federal Register. 

15 ‘‘(5) PROTECTIVE ORDER.—The Copyright Roy16 alty Judges may issue such orders as may be appro17 priate to protect confidential information, including 

18 orders excluding confidential information from the 

19 record of the determination that is published or made 

20 available to the public, except that any terms or rates 

21 of royalty payments or distributions may not be ex22 cluded. 

23 ‘‘(6) PUBLICATION OF DETERMINATION.—The Li24 brarian of Congress shall cause the determination, 

25 and any corrections thereto, to be published in the 
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1 Federal Register. The Librarian of Congress shall also 

2 publicize the determination and corrections in such 

3 other manner as the Librarian considers appropriate, 

4 including, but not limited to, publication on the 

5 Internet. The Librarian of Congress shall also make 

6 the determination, corrections, and the accompanying 

7 record available for public inspection and copying. 

8 ‘‘(7) LATE PAYMENT.—A determination of Copy9 right Royalty Judges may include terms with respect 

10 to late payment, but in no way shall such terms pre11 vent the copyright holder from asserting other rights 

12 or remedies provided under this title. 

13 ‘‘(d) JUDICIAL REVIEW.—

14 ‘‘(1) APPEAL.—Any determination of the Copy15 right Royalty Judges under subsection (c) may, with16 in 30 days after the publication of the determination 

17 in the Federal Register, be appealed, to the United 

18 States Court of Appeals for the District of Columbia 

19 Circuit, by any aggrieved participant in the pro20 ceeding under subsection (b)(2) who fully participated 

21 in the proceeding and who would be bound by the de22 termination. Any party that did not participate in a 

23 rehearing may not raise any issue that was the sub24 ject of that rehearing at any stage of judicial review 

25 of the hearing determination. If no appeal is brought 
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1 within that 30-day period, the determination of the 

2 Copyright Royalty Judges shall be final, and the roy3 alty fee or determination with respect to the distribu4 tion of fees, as the case may be, shall take effect as 

5 set forth in paragraph (2). 

6 ‘‘(2) EFFECT OF RATES.—

7 ‘‘(A) EXPIRATION ON SPECIFIED DATE.—

8 When this title provides that the royalty rates 

9 and terms that were previously in effect are to 

10 expire on a specified date, any adjustment or de11 termination by the Copyright Royalty Judges of 

12 successor rates and terms for an ensuing statu13 tory license period shall be effective as of the day 

14 following the date of expiration of the rates and 

15 terms that were previously in effect, even if the 

16 determination of the Copyright Royalty Judges 

17 is rendered on a later date. 

18 ‘‘(B) OTHER CASES.—In cases where rates 

19 and terms do not expire on a specified date or 

20 have not yet been established, the Copyright Roy21 alty Judges shall determine the dates that suc22 cessor or new rates or terms shall take effect. Ex23 cept as otherwise provided in this title, the rates 

24 and terms previously in effect, to the extent ap-
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1 plicable, shall remain in effect until such suc2 cessor rates and terms become effective. 

3 ‘‘(C) OBLIGATION TO MAKE PAYMENTS.—

4 ‘‘(i) The pendency of an appeal under 

5 this subsection shall not relieve persons obli6 gated to make royalty payments under sec7 tion 111, 112, 114, 115, 116, 118, 119, or 

8 1003, who would be affected by the deter9 mination on appeal, from—

10 ‘‘(I) providing the statements of 

11 account and any report of use; and 

12 ‘‘(II) paying the royalties re13 quired under the relevant determina14 tion or regulations. 

15 ‘‘(ii) Notwithstanding clause (i), whenever 

16 royalties described in clause (i) are paid to a 

17 person other than the Copyright Office, the entity 

18 designated by the Copyright Royalty Judges to 

19 which such royalties are paid by the copyright 

20 user (and any successor thereto) shall, within 60 

21 days after the final resolution of the appeal, re22 turn any excess amounts previously paid (and 

23 interest thereon, if ordered pursuant to para24 graph (3)) to the extent necessary to comply with 
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1 the final determination of royalty rates on ap2 peal. 

3 ‘‘(3) JURISDICTION OF COURT.—If the court, 

4 pursuant to section 706 of title 5, modifies or vacates 

5 a determination of the Copyright Royalty Judges, the 

6 court may enter its own determination with respect 

7 to the amount or distribution of royalty fees and 

8 costs, and order the repayment of any excess fees, the 

9 payment of any underpaid fees, and the payment of 

10 interest pertaining respectively thereto, in accordance 

11 with its final judgment. The court may also vacate 

12 the determination of the Copyright Royalty Judges 

13 and remand the case to the Copyright Royalty Judges 

14 for further proceedings in accordance with subsection 

15 (a). 

16 ‘‘(e) ADMINISTRATIVE MATTERS.—

17 ‘‘(1) DEDUCTION OF COSTS OF LIBRARY OF CON18 GRESS AND COPYRIGHT OFFICE FROM FILING FEES.—

19 ‘‘(A) DEDUCTION FROM FILING FEES.—The 

20 Librarian of Congress may, to the extent not oth21 erwise provided under this title, deduct from the 

22 filing fees collected under subsection (b) for a 

23 particular proceeding under this chapter the rea24 sonable costs incurred by the Librarian of Con25 gress, the Copyright Office, and the Copyright 
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1 Royalty Judges in conducting that proceeding, 

2 other than the salaries of the Copyright Royalty 

3 Judges and the 3 staff members appointed under 

4 section 802(b).

5 ‘‘(B) AUTHORIZATION OF APPROPRIA6 TIONS.—There are authorized to be appropriated 

7 such sums as may be necessary to pay the costs 

8 incurred under this chapter not covered by the 

9 filing fees collected under subsection (b). All 

10 funds made available pursuant to this subpara11 graph shall remain available until expended. 

12 ‘‘(2) POSITIONS REQUIRED FOR ADMINISTRATION

13 OF COMPULSORY LICENSING.—Section 307 of the Leg14 islative Branch Appropriations Act, 1994, shall not 

15 apply to employee positions in the Library of Con16 gress that are required to be filled in order to carry 

17 out section 111, 112, 114, 115, 116, 118, or 119 or 

18 chapter 10. 

19 ‘‘§ 804. Institution of proceedings 

20 ‘‘(a) FILING OF PETITION.—With respect to pro21 ceedings referred to in paragraphs (1) and (2) of section 

22 801(b) concerning the determination or adjustment of roy23 alty rates as provided in sections 111, 112, 114, 115, 116, 

24 118, 119, and 1004, during the calendar years specified in 

25 the schedule set forth in subsection (b), any owner or user 
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1 of a copyrighted work whose royalty rates are specified by 

2 this title, or are established under this chapter before or 

3 after the enactment of the Copyright Royalty and Distribu4 tion Reform Act of 2004, may file a petition with the Copy5 right Royalty Judges declaring that the petitioner requests 

6 a determination or adjustment of the rate. The Copyright 

7 Royalty Judges shall make a determination as to whether 

8 the petitioner has such a significant interest in the royalty 

9 rate in which a determination or adjustment is requested. 

10 If the Copyright Royalty Judges determine that the peti11 tioner has such a significant interest, the Copyright Roy12 alty Judges shall cause notice of this determination, with 

13 the reasons for such determination, to be published in the 

14 Federal Register, together with the notice of commencement 

15 of proceedings under this chapter. With respect to pro16 ceedings under paragraph (1) of section 801(b) concerning 

17 the determination or adjustment of royalty rates as pro18 vided in sections 112 and 114, during the calendar years 

19 specified in the schedule set forth in subsection (b), the 

20 Copyright Royalty Judges shall cause notice of commence21 ment of proceedings under this chapter to be published in 

22 the Federal Register as provided in section 803(b)(1)(A). 

23 ‘‘(b) TIMING OF PROCEEDINGS.—

24 ‘‘(1) SECTION 111 PROCEEDINGS.—(A) A petition 

25 described in subsection (a) to initiate proceedings 
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1 under section 801(b)(2) concerning the adjustment of 

2 royalty rates under section 111 to which subpara3 graph (A) or (D) of section 801(b)(2) applies may be 

4 filed during the year 2005 and in each subsequent 

5 fifth calendar year. 

6 ‘‘(B) In order to initiate proceedings under sec7 tion 801(b)(2) concerning the adjustment of royalty 

8 rates under section 111 to which subparagraph (B) or 

9 (C) of section 801(b)(2) applies, within 12 months 

10 after an event described in either of those subsections, 

11 any owner or user of a copyrighted work whose roy12 alty rates are specified by section 111, or by a rate 

13 established under this chapter before or after the en14 actment of the Copyright Royalty and Distribution 

15 Reform Act of 2004, may file a petition with the 

16 Copyright Royalty Judges declaring that the peti17 tioner requests an adjustment of the rate. The Copy18 right Royalty Judges shall then proceed as set forth 

19 in subsection (a) of this section. Any change in roy20 alty rates made under this chapter pursuant to this 

21 subparagraph may be reconsidered in the year 2005, 

22 and each fifth calendar year thereafter, in accordance 

23 with the provisions in section 801(b)(3) (B) or (C), 

24 as the case may be. A petition for adjustment of rates 

25 under section 11(d)(1)(B) as a result of a change is 
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1 the rules and regulations of the Federal Communica2 tions Commission shall set forth the change on which 

3 the petition is based. 

4 ‘‘(2) CERTAIN SECTION 112 PROCEEDINGS.—Pro5 ceedings under this chapter shall be commenced in the 

6 year 2007 to determine reasonable terms and rates of 

7 royalty payments for the activities described in sec8 tion 112(e)(1) relating to the limitation on exclusive 

9 rights specified by section 114(d)(1)(C)(iv), to become 

10 effective on January 1, 2009. Such proceedings shall 

11 be repeated in each subsequent fifth calendar year. 

12 ‘‘(3) SECTION 114 AND CORRESPONDING 112 PRO13 CEEDINGS.—

14 ‘‘(A) FOR ELIGIBLE NONSUBSCRIPTION

15 SERVICES AND NEW SUBSCRIPTION SERVICES.—

16 Proceedings under this chapter shall be com17 menced as soon as practicable after the effective 

18 date of the Copyright Royalty and Distribution 

19 Reform Act of 2004 to determine reasonable 

20 terms and rates of royalty payments under sec21 tions 114 and 112 for the activities of eligible 

22 nonsubscription transmission services and new 

23 subscription services, to be effective for the period 

24 beginning on January 1, 2006, and ending on 

25 December 31, 2010. Such proceedings shall next 
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1 be commenced in January 2009 to determine 

2 reasonable terms and rates of royalty payments, 

3 to become effective on January 1, 2011. There4 after, such proceedings shall be repeated in each 

5 subsequent fifth calendar year. 

6 ‘‘(B) FOR PREEXISTING SUBSCRIPTION AND

7 SATELLITE DIGITAL AUDIO RADIO SERVICES.—

8 Proceedings under this chapter shall be com9 menced in January 2006 to determine reasonable 

10 terms and rates of royalty payments under sec11 tions 114 and 112 for the activities of pre12 existing subscription services, to be effective dur13 ing the period beginning on January 1, 2008, 

14 and ending on December 31, 2012, and pre15 existing satellite digital audio radio services, to 

16 be effective during the period beginning on Janu17 ary 1, 2007, and ending on December 31, 2012. 

18 Such proceedings shall next be commenced in 

19 2011 to determine reasonable terms and rates of 

20 royalty payments, to become effective on Janu21 ary 1, 2013. Thereafter, such proceedings shall be 

22 repeated in each subsequent fifth calendar year. 

23 ‘‘(C)(i) Notwithstanding any other provi24 sion of this chapter, this subparagraph shall gov25 ern proceedings commenced pursuant to section 
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1 114(f)(1)(C) and 114(f)(2)(C) concerning new 

2 types of services. 

3 ‘‘(ii) Not later than 30 days after a petition 

4 to determine rates and terms for a new type of 

5 service that is filed by any copyright owner of 

6 sound recordings, or such new type of service, in7 dicating that such new type of service is or is 

8 about to become operational, the Copyright Roy9 alty Judges shall issue a notice for a proceeding 

10 to determine rates and terms for such service. 

11 ‘‘(iii) The proceeding shall follow the sched12 ule set forth in such subsections (b), (c), and (d) 

13 of section 803, except that—

14 ‘‘(I) the determination shall be issued 

15 by not later than 24 months after the publi16 cation of the notice under clause (ii); and 

17 ‘‘(II) the decision shall take effect as 

18 provided in subsections (c)(2) and (d)(2) of 

19 section 803 and section 114(f)(4)(B)(ii) and 

20 (C). 

21 ‘‘(iv) The rates and terms shall remain in 

22 effect for the period set forth in section 

23 114(f)(1)(C) or 114(f)(2)(C), as the case may be. 

24 ‘‘(4) SECTION 115 PROCEEDINGS.—A petition de25 scribed in subsection (a) to initiate proceedings under 
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1 section 801(b)(1) concerning the adjustment or deter2 mination of royalty rates as provided in section 115 

3 may be filed in the year 2006 and in each subsequent 

4 fifth calendar year, or at such other times as the par5 ties have agreed under section 115(c)(3) (B) and (C). 

6 ‘‘(5) SECTION 116 PROCEEDINGS.—(A) A petition 

7 described in subsection (a) to initiate proceedings 

8 under section 801(b) concerning the determination of 

9 royalty rates and terms as provided in section 116 

10 may be filed at any time within 1 year after nego11 tiated licenses authorized by section 116 are termi12 nated or expire and are not replaced by subsequent 

13 agreements. 

14 ‘‘(B) If a negotiated license authorized by section 

15 116 is terminated or expires and is not replaced by 

16 another such license agreement which provides per17 mission to use a quantity of musical works not sub18 stantially smaller than the quantity of such works 

19 performed on coin-operated phonorecord players dur20 ing the 1-year period ending March 1, 1989, the 

21 Copyright Royalty Judges shall, upon petition filed 

22 under paragraph (1) within 1 year after such termi23 nation or expiration, commence a proceeding to 

24 promptly establish an interim royalty rate or rates 

25 for the public performance by means of a coin-oper-
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1 ated phonorecord player of nondramatic musical 

2 works embodied in phonorecords which had been sub3 ject to the terminated or expired negotiated license 

4 agreement. Such rate or rates shall be the same as the 

5 last such rate or rates and shall remain in force until 

6 the conclusion of proceedings by the Copyright Roy7 alty Judges, in accordance with section 803, to adjust 

8 the royalty rates applicable to such works, or until 

9 superseded by a new negotiated license agreement, as 

10 provided in section 116(b).

11 ‘‘(6) SECTION 118 PROCEEDINGS.—A petition de12 scribed in subsection (a) to initiate proceedings under 

13 section 801(b)(1) concerning the determination of rea14 sonable terms and rates of royalty payments as pro15 vided in section 118 may be filed in the year 2006 

16 and in each subsequent fifth calendar year. 

17 ‘‘(7) SECTION 1004 PROCEEDINGS.—A petition 

18 described in subsection (a) to initiate proceedings 

19 under section 801(b)(1) concerning the adjustment of 

20 reasonable royalty rates under section 1004 may be 

21 filed as provided in section 1004(a)(3). 

22 ‘‘(8) PROCEEDINGS CONCERNING DISTRIBUTION

23 OF ROYALTY FEES.—With respect to proceedings 

24 under section 801(b)(3) concerning the distribution of 

25 royalty fees in certain circumstances under section 
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1 111, 119, or 1007, the Copyright Royalty Judges 

2 shall, upon a determination that a controversy exists 

3 concerning such distribution, cause to be published in 

4 the Federal Register notice of commencement of pro5 ceedings under this chapter. 

6 ‘‘§ 805. General rule for voluntarily negotiated agree7 ments 

8 ‘‘Any rates or terms under this title that—

9 ‘‘(1) are agreed to by participants to a pro10 ceeding under section 803(b)(3), 

11 ‘‘(2) are adopted by the Copyright Royalty 

12 Judges as part of a determination under this chapter, 

13 and 

14 ‘‘(3) are in effect for a period shorter than would 

15 otherwise apply under a determination pursuant to 

16 this chapter, 

17 shall remain in effect for such period of time as would other18 wise apply under such determination, except that the Copy19 right Royalty Judges shall adjust the rates pursuant to the 

20 voluntary negotiations to reflect national monetary infla21 tion during the additional period the rates remain in ef22 fect.’’. 

23 (b) CONFORMING AMENDMENT.—The table of chapters 

24 for title 17, United States Code, is amended by striking the 

25 item relating to chapter 8 and inserting the following:

‘‘8. Proceedings by Copyright Royalty Judges ........................... 801’’.
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1 SEC. 4. DEFINITION. 

2 Section 101 is amended by inserting after the defini3 tion of ‘‘copies’’ the following: 

4 ‘‘A ‘Copyright Royalty Judge’ is a Copyright 

5 Royalty Judge appointed under section 802 of this 

6 title, and includes any individual serving as an in7 terim Copyright Royalty Judge under such section.’’. 

8 SEC. 5. TECHNICAL AMENDMENTS. 

9 (a) CABLE RATES.—Section 111(d) is amended—

10 (1) in paragraph (2), in the second sentence, by 

11 striking ‘‘a copyright arbitration royalty panel’’ and 

12 inserting ‘‘the Copyright Royalty Judges.’’; and 

13 (2) in paragraph (4)—

14 (A) in subparagraph (A), by striking ‘‘Li15 brarian of Congress’’ each place it appears and 

16 inserting ‘‘Copyright Royalty Judges’’; 

17 (B) in subparagraph (B)—

18 (i) in the first sentence, by striking 

19 ‘‘Librarian of Congress shall, upon the rec20 ommendation of the Register of Copy21 rights,’’ and inserting ‘‘Copyright Royalty 

22 Judges shall’’; 

23 (ii) in the second sentence, by striking 

24 ‘‘Librarian determines’’ and inserting 

25 ‘‘Copyright Royalty Judges determine’’; and 

26 (iii) in the third sentence—
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1 (I) by striking ‘‘Librarian’’ each 

2 place it appears and inserting ‘‘Copy3 right Royalty Judges’’; and 

4 (II) by striking ‘‘convene a copy5 right arbitration royalty panel’’ and 

6 inserting ‘‘conduct a proceeding’’; and 

7 (C) in subparagraph (C), by striking ‘‘Li8 brarian of Congress’’ and inserting ‘‘Copyright 

9 Royalty Judges’’.

10 (b) EPHEMERAL RECORDINGS.—Section 112(e) is 

11 amended—

12 (1) in paragraph (3)—

13 (A) by amending the first sentence to read 

14 as follows: ‘‘Proceedings under chapter 8 shall 

15 determine reasonable rates and terms of royalty 

16 payments for the activities specified by para17 graph (1) during the 5-year periods beginning 

18 on January 1 of the second year following the 

19 year in which the proceedings are to be com20 menced, or such other periods as the parties may 

21 agree.’’; and 

22 (B) by striking the second sentence; 

23 (C) in the third sentence, by striking ‘‘Li24 brarian of Congress’’ and inserting ‘‘Copyright 

25 Royalty Judges’’; and 
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1 (D) in the fourth sentence, by striking ‘‘ne2 gotiation’’; 

3 (2) in paragraph (4)—

4 (A) by amending the first sentence to read 

5 as follows: ‘‘The schedule of reasonable rates and 

6 terms determined by the Copyright Royalty 

7 Judges shall, subject to paragraph (5), be bind8 ing on all copyright owners of sound recordings 

9 and transmitting organizations entitled to a 

10 statutory license under this subsection during the 

11 5-year period specified in paragraph (3), or such 

12 other period as the parties may agree.’’; 

13 (B) by striking ‘‘copyright arbitration roy14 alty panel’’ each subsequent place it appears and 

15 inserting ‘‘Copyright Royalty Judges’’; 

16 (C) in the fourth sentence, by striking ‘‘its 

17 decision’’ and inserting ‘‘their decision’’; 

18 (D) in the fifth sentence, by striking ‘‘nego19 tiated as provided’’ and inserting ‘‘described’’; 

20 and 

21 (E) in the last sentence, by striking ‘‘Li22 brarian of Congress’’ and inserting ‘‘Copyright 

23 Royalty Judges’’; 

24 (3) in paragraph (5), by striking ‘‘or decision by 

25 the Librarian of Congress’’ and inserting ‘‘, decision 
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1 by the Librarian of Congress, or determination by the 

2 Copyright Royalty Judges’’;

3 (4) by striking paragraph (6) and redesignating 

4 paragraphs (7), (8), and (9), as paragraphs (6), (7), 

5 and (8), respectively; and 

6 (5) in paragraph (6)(A), as so redesignated, by 

7 striking ‘‘Librarian of Congress’’ and inserting 

8 ‘‘Copyright Royalty Judges’’. 

9 (c) SCOPE OF EXCLUSIVE RIGHTS IN SOUND RECORD10 INGS.—Section 114(f) is amended—

11 (1) in paragraph (1)—

12 (A) in subparagraph (A)—

13 (i) by amending the first sentence to 

14 read as follows: ‘‘Proceedings under chapter 

15 8 shall determine reasonable rates and 

16 terms of royalty payments for subscription 

17 transmissions by preexisting subscription 

18 services and transmissions by preexisting 

19 satellite digital audio radio services speci20 fied by subsection (d)(2) during 5-year peri21 ods beginning on January 1 of the second 

22 year following the year in which the pro23 ceedings are to be commenced, except where 

24 different transitional periods are provided 
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1 in section 804(b), or such periods as the 

2 parties may agree.’’; 

3 (ii) in the third sentence, by striking 

4 ‘‘Librarian of Congress’’ and inserting 

5 ‘‘Copyright Royalty Judges’’; and 

6 (iii) in the fourth sentence, by striking 

7 ‘‘negotiation’’; 

8 (B) in subparagraph (B)—

9 (i) by amending the first sentence to 

10 read as follows: ‘‘The schedule of reasonable 

11 rates and terms determined by the Copy12 right Royalty Judges shall, subject to para13 graph (3), be binding on all copyright own14 ers of sound recordings and entities per15 forming sound recordings affected by this 

16 paragraph during the 5-year period speci17 fied in subparagraph (A), a transitional pe18 riod provided in section 804(b), or such 

19 other period as the parties may agree.’’; 

20 (ii) in the second sentence, by striking 

21 ‘‘copyright arbitration royalty panel’’ and 

22 inserting ‘‘Copyright Royalty Judges’’; and 

23 (iii) in the second sentence, by striking 

24 ‘‘negotiated as provided’’ and inserting ‘‘de25 scribed’’; and
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1 (C) by amending subparagraph (C) to read 

2 as follows: 

3 ‘‘(C) The procedures under subparagraphs (A) 

4 and (B) also shall be initiated pursuant to a petition 

5 filed by any copyright owners of sound recordings, 

6 any preexisting subscription services, or any pre7 existing satellite digital audio radio services indi8 cating that a new type of subscription digital audio 

9 transmission service on which sound recordings are 

10 performed is or is about to become operational, for the 

11 purpose of determining reasonable terms and rates of 

12 royalty payments with respect to such new type of 

13 transmission service for the period beginning with the 

14 inception of such new type of service and ending on 

15 the date on which the royalty rates and terms for sub16 scription digital audio transmission services most re17 cently determined under subparagraph (A) or (B) 

18 and chapter 8 expire, or such other period as the par19 ties may agree.’’; 

20 (2) in paragraph (2)—

21 (A) in subparagraph (A)—

22 (i) by amending the first paragraph to 

23 read as follows: ‘‘Proceedings under chapter 

24 8 shall determine reasonable rates and 

25 terms of royalty payments for subscription 
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1 transmissions by preexisting subscription 

2 services and transmissions by preexisting 

3 satellite digital audio radio services speci4 fied by subsection (d)(2) during 5-year peri5 ods beginning on January 1 of the second 

6 year following the year in which the pro7 ceedings are to be commenced, except where 

8 different transitional periods are provided 

9 in section 804(b), or such periods as the 

10 parties may agree.’’; 

11 (ii) in the third sentence, by striking 

12 ‘‘Librarian of Congress’’ and inserting 

13 ‘‘Copyright Royalty Judges’’; and 

14 (iii) in the fourth sentence, by striking 

15 ‘‘negotiation’’; 

16 (B) in subparagraph (B)—

17 (i) by amending the first sentence to 

18 read as follows: ‘‘The schedule of reasonable 

19 rates and terms determined by the Copy20 right Royalty Judges shall, subject to para21 graph (3), be binding on all copyright own22 ers of sound recordings and entities per23 forming sound recordings affected by this 

24 paragraph during the 5-year period speci25 fied in subparagraph (A), a transitional pe-
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1 riod provided in section 804(b), or such 

2 other period as the parties may agree.’’; 

3 (ii) by striking ‘‘copyright arbitration 

4 royalty panel’’ each subsequent place it ap5 pears and inserting ‘‘Copyright Royalty 

6 Judges’’; and 

7 (iii) in the last sentence by striking 

8 ‘‘negotiated as provided’’ and inserting ‘‘de9 scribed in’’; and

10 (C) by amending subparagraph (C) to read 

11 as follows: 

12 ‘‘(C) The procedures under subparagraphs (A) 

13 and (B) shall also be initiated pursuant to a petition 

14 filed by any copyright owners of sound recordings or 

15 any eligible nonsubscription service or new subscrip16 tion service indicating that a new type of eligible 

17 nonsubscription service or new subscription service on 

18 which sound recordings are performed is or is about 

19 to become operational, for the purpose of determining 

20 reasonable terms and rates of royalty payments with 

21 respect to such new type of service for the period be22 ginning with the inception of such new type of service 

23 and ending on the date on which the royalty rates 

24 and terms for preexisting subscription digital audio 

25 transmission services or preexisting satellite digital 
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1 radio audio services, as the case may be, most re2 cently determined under subparagraph (A) or (B) 

3 and chapter 8 expire, or such other period as the par4 ties may agree.’’;

5 (3) in paragraph (3), by striking ‘‘or decision by 

6 the Librarian of Congress’’ and inserting ‘‘, decision 

7 by the Librarian of Congress, or determination by the 

8 Copyright Royalty Judges’’; and 

9 (4) in paragraph (4)— 

10 (A) by striking ‘‘Librarian of Congress’’ 

11 each place it appears and inserting ‘‘Copyright 

12 Royalty Judges’’; and 

13 (B) by adding after the first sentence ‘‘The 

14 notice and recordkeeping rules in effect on the 

15 day before the effective date of the Copyright 

16 Royalty and Distribution Reform Act of 2004 

17 shall remain in effect until new regulations are 

18 promulgated by the Copyright Royalty Judges. If 

19 new regulations are promulgated under this sub20 paragraph, the Copyright Royalty Judges shall 

21 take into account the substance and effect of the 

22 rules in effect on the day before the effective date 

23 of the Copyright Royalty and Distribution Re24 form Act of 2004 and shall, to the extent prac25 ticable, avoid significant disruption of the func-
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1 tion of the designated agents that are authorized 

2 to collect and distribute royalty fees as such 

3 functions exist on the day prior to the effective 

4 date of this Act.’’. 

5 (d) PHONORECORDS OF NONDRAMATIC MUSICAL

6 WORKS.—Section 115(c)(3) is amended—

7 (1) in subparagraph (A)(ii), by striking ‘‘(F)’’ 

8 and inserting ‘‘(E)’’; 

9 (2) in subparagraph (B)—

10 (A) by striking ‘‘under this paragraph’’ and 

11 inserting ‘‘under this section’’; and 

12 (B) by striking ‘‘subparagraphs (B) through 

13 (F)’’ and inserting ‘‘this subparagraph and sub14 paragraphs (B) through (E)’’; 

15 (3) in subparagraph (C)—

16 (A) by amending the first sentence to read 

17 as follows: ‘‘Proceedings under chapter 8 shall 

18 determine reasonable rates and terms of royalty 

19 payments for the activities specified by this sec20 tion during periods beginning with the effective 

21 date of such rates and terms, but not earlier than 

22 January 1 of the second year following the year 

23 in which the petition requesting the proceeding is 

24 filed, and ending on the effective date of successor 
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1 rates and terms, or such other period as the par2 ties may agree.’’; 

3 (B) in the third sentence, by striking ‘‘Li4 brarian of Congress’’ and inserting ‘‘Copyright 

5 Royalty Judges’’; and 

6 (C) in the fourth sentence, by striking ‘‘ne7 gotiation’’; 

8 (4) in subparagraph (D)—

9 (A) by amending the first sentence to read 

10 as follows: ‘‘The schedule of reasonable rates and 

11 terms determined by the Copyright Royalty 

12 Judges shall, subject to subparagraph (E), be 

13 binding on all copyright owners of nondramatic 

14 musical works and persons entitled to obtain a 

15 compulsory license under subsection (a)(1) dur16 ing the period specified in subparagraph (C), 

17 such other period as may be determined pursu18 ant to subparagraphs (B) and (C), or such other 

19 period as the parties may agree.’’; 

20 (B) in the third sentence, by striking ‘‘copy21 right arbitration royalty panel’’ and inserting 

22 ‘‘Copyright Royalty Judges’’; and 

23 (C) in the third sentence, by striking ‘‘nego24 tiated as provided in subparagraphs (B) and 

25 (C)’’ and inserting ‘‘described’’; 
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1 (5) in subparagraph (E)—

2 (A) in clause (i)—

3 (i) in the first sentence, by striking 

4 ‘‘Librarian of Congress’’ and inserting ‘‘Li5 brarian of Congress, Copyright Royalty 

6 Judges, or a copyright arbitration royalty 

7 panel to the extent those determinations 

8 were accepted by the Librarian of Con9 gress’’; and 

10 (ii) in the second sentence, by striking 

11 ‘‘(C), (D) or (F) shall be given effect’’ and 

12 inserting ‘‘(C) or (D) shall be given effect as 

13 to digital phonorecord deliveries’’; and 

14 (B) in clause (ii)(I), by striking ‘‘(C), (D) 

15 or (F)’’ each place it appears and inserting ‘‘(C) 

16 or (D)’’; and

17 (6) by striking subparagraph (F) and redesig18 nating subparagraphs (G) through (L) as subpara19 graphs (F) through (K), respectively.

20 (e) COIN-OPERATED PHONORECORD PLAYERS.—Sec21 tion 116 is amended—

22 (1) in subsection (b), by amending paragraph 

23 (2) to read as follows: 

24 ‘‘(2) CHAPTER 8 PROCEEDING.—Parties not sub25 ject to such a negotiation may have the terms and 
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1 rates and the division of fees described in paragraph 

2 (1) determined in a proceeding in accordance with 

3 the provisions of chapter 8.’’; and 

4 (2) in subsection (c)—

5 (A) in the subsection heading, by striking 

6 ‘‘COPYRIGHT ARBITRATION ROYALTY PANEL DE7 TERMINATIONS’’ and inserting ‘‘DETERMINA8 TIONS BY COPYRIGHT ROYALTY JUDGES’’; and 

9 (B) by striking ‘‘a copyright arbitration 

10 royalty panel’’ and inserting ‘‘the Copyright 

11 Royalty Judges’’. 

12 (f) USE OF CERTAIN WORKS IN CONNECTION WITH

13 NONCOMMERCIAL BROADCASTING.—Section 118 is amend14 ed—

15 (1) in subsection (b)—

16 (A) in paragraph (1)—

17 (i) in the first sentence, by striking 

18 ‘‘Librarian of Congress’’ and inserting 

19 ‘‘Copyright Royalty Judges’’; and 

20 (ii) by striking the second and third 

21 sentences; 

22 (B) in paragraph (2), by striking ‘‘Librar23 ian of Congress:’’ and all that follows through the 

24 end of the sentence and inserting ‘‘Librarian of 

25 Congress, a copyright arbitration royalty panel, 
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1 or the Copyright Royalty Judges, to the extent 

2 that they were accepted by the Librarian of Con3 gress, if copies of such agreements are filed with 

4 the Copyright Royalty Judges within 30 days of 

5 execution in accordance with regulations that the 

6 Copyright Royalty Judges shall issue.’’; and

7 (C) in paragraph (3)—

8 (i) in the second sentence—

9 (I) by striking ‘‘copyright arbitra10 tion royalty panel’’ and inserting 

11 ‘‘Copyright Royalty Judges’’; and

12 (II) by striking ‘‘paragraph (2).’’ 

13 and inserting ‘‘paragraph (2) or (3).’’; 

14 (ii) in the last sentence, by striking 

15 ‘‘‘Librarian of Congress’’ and inserting 

16 ‘‘Copyright Royalty Judges’’; and 

17 (iii) by striking ‘‘(3) In’’ and all that 

18 follows through the end of the first sentence 

19 and inserting the following: 

20 ‘‘(3) Voluntary negotiation proceedings initiated 

21 pursuant to a petition filed under section 804(a) for 

22 the purpose of determining a schedule of terms and 

23 rates of royalty payments by public broadcasting en24 tities to copyright owners in works specified by this 

25 subsection and the proportionate division of fees paid 
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1 among various copyright owners shall cover the 5-

2 year period beginning on January 1 of the second 

3 year following the year in which the petition is filed. 

4 The parties to each negotiation proceeding shall bear 

5 their own costs. 

6 ‘‘(4) In the absence of license agreements nego7 tiated under paragraph (2) or (3), the Copyright 

8 Royalty Judges shall, pursuant to chapter 8, conduct 

9 a proceeding to determine and publish in the Federal 

10 Register a schedule of rates and terms which, subject 

11 to paragraph (2), shall be binding on all owners of 

12 copyright in works specified by this subsection and 

13 public broadcasting entities, regardless of whether 

14 such copyright owners have submitted proposals to the 

15 Copyright Royalty Judges.’’;

16 (2) by striking subsection (c) and redesignating 

17 subsections (d) through (g) as subsections (c) through 

18 (f), respectively; 

19 (3) in subsection (c), as so redesignated, in the 

20 matter preceding paragraph (1)—

21 (A) by striking ‘‘(b)(2)’’ and inserting 

22 ‘‘(b)(2) or (3)’’; 

23 (B) by striking ‘‘(b)(3)’’ and inserting 

24 ‘‘(b)(4)’’; and 
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1 (C) by striking ‘‘a copyright arbitration 

2 royalty panel under subsection (b)(3)’’ and in3 serting ‘‘the Copyright Royalty Judges under 

4 subsection (b)(3), to the extent that they were ac5 cepted by the Librarian of Congress’’; 

6 (4) in subsection (d), as so redesignated—

7 (A) by striking ‘‘in the Copyright Office’’ 

8 and inserting ‘‘with the Copyright Royalty 

9 Judges’’; and 

10 (B) by striking ‘‘Register of Copyrights 

11 shall prescribe’’ and inserting ‘‘Copyright Roy12 alty Judges shall prescribe as provided in section 

13 803(b)(6)’’; and 

14 (5) in subsection (f), as so redesignated, by strik15 ing ‘‘(d)’’ and inserting ‘‘(c)’’. 

16 (g) SECONDARY TRANSMISSIONS BY SATELLITE CAR17 RIERS.—Section 119(b) is amended—

18 (1) in paragraph (3), by striking ‘‘Librarian of 

19 Congress’’ and inserting ‘‘Copyright Royalty Judges’’; 

20 and 

21 (2) in paragraph (4)—

22 (A) in subparagraph (A), by striking ‘‘Li23 brarian of Congress’’ each place it appears and 

24 inserting ‘‘Copyright Royalty Judges’’; and 
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1 (B) by amending subparagraphs (B) and 

2 (C) to read as follows: 

3 ‘‘(B) DETERMINATION OF CONTROVERSY; 

4 DISTRIBUTIONS.—After the first day of August of 

5 each year, the Copyright Royalty Judges shall 

6 determine whether there exists a controversy con7 cerning the distribution of royalty fees. If the 

8 Copyright Royalty Judges determine that no 

9 such controversy exists, the Librarian of Con10 gress shall, after deducting reasonable adminis11 trative costs under this paragraph, distribute 

12 such fees to the copyright owners entitled to re13 ceive them, or to their designated agents. If the 

14 Copyright Royalty Judges find the existence of a 

15 controversy, the Copyright Royalty Judges shall, 

16 pursuant to chapter 8 of this title, conduct a 

17 proceeding to determine the distribution of roy18 alty fees. 

19 ‘‘(C) WITHHOLDING OF FEES DURING CON20 TROVERSY.—During the pendency of any pro21 ceeding under this subsection, the Copyright 

22 Royalty Judges shall withhold from distribution 

23 an amount sufficient to satisfy all claims with 

24 respect to which a controversy exists, but shall 
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1 have the discretion to proceed to distribute any 

2 amounts that are not in controversy.’’.

3 (h) DIGITAL AUDIO RECORDING DEVICES.—

4 (1) ROYALTY PAYMENTS.—Section 1004(a)(3) is 

5 amended by striking ‘‘Librarian of Congress’’ each 

6 place it appears and inserting ‘‘Copyright Royalty 

7 Judges’’.

8 (2) ENTITLEMENT TO ROYALTY PAYMENTS.—Sec9 tion 1006(c) is amended by striking ‘‘Librarian of 

10 Congress shall convene a copyright arbitration roy11 alty panel which’’ and inserting ‘‘Copyright Royalty 

12 Judges’’. 

13 (3) PROCEDURES FOR DISTRIBUTING ROYALTY

14 PAYMENTS.—Section 1007 is amended—

15 (A) in subsection (a), by amending para16 graph (1) to read as follows: 

17 ‘‘(1) FILING OF CLAIMS.—During the first 2 

18 months of each calendar year, every interested copy19 right party seeking to receive royalty payments to 

20 which such party is entitled under section 1006 shall 

21 file with the Copyright Royalty Judges a claim for 

22 payments collected during the preceding year in such 

23 form and manner as the Copyright Royalty Judges 

24 shall prescribe by regulation.’’; and 
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1 (B) by amending subsections (b) and (c) to 

2 read as follows: 

3 ‘‘(b) DISTRIBUTION OF PAYMENTS IN THE ABSENCE OF

4 A DISPUTE.—After the period established for the filing of 

5 claims under subsection (a), in each year, the Copyright 

6 Royalty Judges shall determine whether there exists a con7 troversy concerning the distribution of royalty payments 

8 under section 1006(c). If the Copyright Royalty Judges de9 termine that no such controversy exists, the Librarian of 

10 Congress shall, within 30 days after such determination, 

11 authorize the distribution of the royalty payments as set 

12 forth in the agreements regarding the distribution of royalty 

13 payments entered into pursuant to subsection (a). The Li14 brarian of Congress shall, before such royalty payments are 

15 distributed, deduct the reasonable administrative costs in16 curred by the Librarian under this section.

17 ‘‘(c) RESOLUTION OF DISPUTES.—If the Copyright 

18 Royalty Judges find the existence of a controversy, the 

19 Copyright Royalty Judges shall, pursuant to chapter 8 of 

20 this title, conduct a proceeding to determine the distribution 

21 of royalty payments. During the pendency of such a pro22 ceeding, the Copyright Royalty Judges shall withhold from 

23 distribution an amount sufficient to satisfy all claims with 

24 respect to which a controversy exists, but shall, to the extent 

25 feasible, authorize the distribution of any amounts that are 
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1 not in controversy. The Librarian of Congress shall, before 

2 such royalty payments are distributed, deduct the reason3 able administrative costs incurred by the Librarian under 

4 this section.’’. 

5 (4) DETERMINATION OF CERTAIN DISPUTES.—

6 (A) Section 1010 is amended to read as follows: 

7 ‘‘§ 1010. Determination of certain disputes 

8 ‘‘(a) SCOPE OF DETERMINATION.—Before the date of 

9 first distribution in the United States of a digital audio 

10 recording device or a digital audio interface device, any 

11 party manufacturing, importing, or distributing such de12 vice, and any interested copyright party may mutually 

13 agree to petition the Copyright Royalty Judges to determine 

14 whether such device is subject to section 1002, or the basis 

15 on which royalty payments for such device are to be made 

16 under section 1003. 

17 ‘‘(b) INITIATION OF PROCEEDINGS.—The parties under 

18 subsection (a) shall file the petition with the Copyright Roy19 alty Judges requesting the commencement of a proceeding. 

20 Within 2 weeks after receiving such a petition, the Chief 

21 Copyright Royalty Judge shall cause notice to be published 

22 in the Federal Register of the initiation of the proceeding. 

23 ‘‘(c) STAY OF JUDICIAL PROCEEDINGS.—Any civil ac24 tion brought under section 1009 against a party to a pro25 ceeding under this section shall, on application of one of 
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1 the parties to the proceeding, be stayed until completion of 

2 the proceeding. 

3 ‘‘(d) PROCEEDING.—The Copyright Royalty Judges 

4 shall conduct a proceeding with respect to the matter con5 cerned, in accordance with such procedures as the Copyright 

6 Royalty Judges may adopt. The Copyright Royalty Judges 

7 shall act on the basis of a fully documented written record. 

8 Any party to the proceeding may submit relevant informa9 tion and proposals to the Copyright Royalty Judges. The 

10 parties to the proceeding shall each bear their respective 

11 costs of participation. 

12 ‘‘(e) JUDICIAL REVIEW.—Any determination of the 

13 Copyright Royalty Judges under subsection (d) may be ap14 pealed, by a party to the proceeding, in accordance with 

15 section 803(d) of this title. The pendency of an appeal under 

16 this subsection shall not stay the determination of the Copy17 right Royalty Judges. If the court modifies the determina18 tion of the Copyright Royalty Judges, the court shall have 

19 jurisdiction to enter its own decision in accordance with 

20 its final judgment. The court may further vacate the deter21 mination of the Copyright Royalty Judges and remand the 

22 case for proceedings as provided in this section.’’. 

23 (B) The item relating to section 1010 in the 

24 table of sections for chapter 10 is amended to read as 

25 follows:

‘‘1010. Determination of certain disputes.’’.
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1 SEC. 6. EFFECTIVE DATE AND TRANSITION PROVISIONS. 

2 (a) EFFECTIVE DATE.—This Act and the amendments 

3 made by this Act shall take effect 6 months after the date 

4 of the enactment of this Act, except that the Librarian of 

5 Congress shall appoint 1 or more interim Copyright Roy6 alty Judges under section 802(d) of title 17, United States 

7 Code, as amended by this Act, within 90 days after such 

8 date of enactment to carry out the functions of the Copy9 right Royalty Judges under title 17, United States Code, 

10 to the extent that Copyright Royalty Judges provided for 

11 in section 801(a) of title 17, United States Code, as amend12 ed by this Act, have not been appointed before the end of 

13 that 90-day period. 

14 (b) TRANSITION PROVISIONS.—

15 (1) IN GENERAL.—Subject to paragraphs (2) and 

16 (3), the amendments made by this Act shall not affect 

17 any proceedings commenced, petitions filed, or vol18 untary agreements entered into before the enactment 

19 of this Act under the provisions of title 17, United 

20 States Code, amended by this Act, and pending on 

21 such date of enactment. Such proceedings shall con22 tinue, determinations made in such proceedings, and 

23 appeals taken therefrom, as if this Act had not been 

24 enacted, and shall continue in effect until modified 

25 under title 17, United States Code, as amended by 

26 this Act. Such petitions filed and voluntary agree-
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1 ments entered into shall remain in effect as if this Act 

2 had not been enacted. For the purposes of this para3 graph, the Librarian of Congress may determine 

4 whether a proceeding has commenced. 

5 (2) PENDING PROCEEDINGS.—Notwithstanding 

6 paragraph (1), any proceeding commenced before the 

7 enactment of this Act may be terminated by the Li8 brarian of Congress, with the approval of the Copy9 right Royalty Judges. In such cases, the Copyright 

10 Royalty Judges shall initiate a new proceeding in ac11 cordance with regulations adopted pursuant to section 

12 803(b)(6) of title 17, United States Code. 

13 (3) EFFECTIVE PERIODS FOR CERTAIN RATE14 MAKING PROCEEDINGS.—Notwithstanding paragraph 

15 (1), terms and rates in effect under section 114(f)(2) 

16 or 112(e) of title 17, United States Code, for new sub17 scription services, eligible nonsubscription services, 

18 and services exempt under section 114(d)(1)(C)(iv) of 

19 such title for the period 2003 through 2004, and any 

20 rates published in the Federal Register under the au21 thority of the Small Webcaster Settlement Act of 2002 

22 for the years 2003 through 2004, shall be effective 

23 until the later of the first applicable effective date for 

24 successor terms and rates specified in section 

25 804(b)(2) or (3)(A) of title 17, United States Code, or 
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1 until such later date as the parties may agree or the 

2 Copyright Royalty Judges may establish. If successor 

3 terms and rates have not yet been established by such 

4 date, licensees shall continue to make royalty pay5 ments at the rates and on the terms previously in ef6 fect, subject to retroactive adjustment when successor 

7 rates and terms for such services are established. 

8 (c) EXISTING APPROPRIATIONS.—Any funds made 

9 available in an appropriations Act before the effective date 

10 of this Act to carry out chapter 8 of title 17, United States 

11 Code, shall be available to the extent necessary to carry out 

12 this section. 
Calendar No. 744

108TH CONGRESS 

2D SESSION H. R. 1417

AN ACT

To amend title 17, United States Code, to replace 

right Royalty Judges, and for other purposes. copyright arbitration royalty panels with CopySEPTEMBER 29, 2004

Reported with an amendment