In the Senate of the United States,

October 6, 2004.

Resolved, That the bill from the House of Representatives (H.R. 1417) entitled ‘‘An Act to amend title 17, United

States Code, to replace copyright arbitration royalty panels

with Copyright Royalty Judges, and for other purposes.’’, do

pass with the following

AMENDMENT:

Strike out all after the enacting clause and insert:

1 SECTION 1. SHORT TITLE.

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

3 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.—The Librarian of Congress shall

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

16 appoint 1 of the 3 as the Chief Copyright Royalty Judge.

17 The Librarian shall make appointments to such positions

18 after consultation with the Register of Copyrights.

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

20 chapter, the functions of the Copyright Royalty Judges shall

21 be as follows:
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1 ‘‘(1) To make determinations and adjustments of

2 reasonable terms and rates of royalty payments as

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

4 and 1004. The rates applicable under sections

5 114(f)(1)(B), 115, and 116 shall be calculated to

6 achieve the following objectives:

7 ‘‘(A) To maximize the availability of cre8 ative works to the public.

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

10 return for his or her creative work and the copy11 right user a fair income under existing economic

12 conditions.

13 ‘‘(C) To reflect the relative roles of the copy14 right owner and the copyright user in the prod15 uct made available to the public with respect to

16 relative creative contribution, technological con17 tribution, capital investment, cost, risk, and con18 tribution to the opening of new markets for cre19 ative expression and media for their communica20 tion.

21 ‘‘(D) To minimize any disruptive impact

22 on the structure of the industries involved and on

23 generally prevailing industry practices.

24 ‘‘(2) To make determinations concerning the ad25 justment of the copyright royalty rates under section
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1 111 solely in accordance with the following provi2 sions:

3 ‘‘(A) The rates established by section

4 111(d)(1)(B) may be adjusted to reflect—

5 ‘‘(i) national monetary inflation or de6 flation; or

7 ‘‘(ii) changes in the average rates

8 charged cable subscribers for the basic serv9 ice of providing secondary transmissions to

10 maintain the real constant dollar level of

11 the royalty fee per subscriber which existed

12 as of the date of October 19, 1976,

13 except that—

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

15 system subscribers for the basic service of

16 providing secondary transmissions are

17 changed so that the average rates exceed na18 tional monetary inflation, no change in the

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

20 shall be permitted; and

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

22 shall be permitted based on any reduction

23 in the average number of distant signal

24 equivalents per subscriber.
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1 The Copyright Royalty Judges may consider all

2 factors relating to the maintenance of such level

3 of payments, including, as an extenuating factor,

4 whether the industry has been restrained by sub5 scriber rate regulating authorities from increas6 ing the rates for the basic service of providing

7 secondary transmissions.

8 ‘‘(B) In the event that the rules and regula9 tions of the Federal Communications Commis10 sion are amended at any time after April 15,

11 1976, to permit the carriage by cable systems of

12 additional television broadcast signals beyond

13 the local service area of the primary transmitters

14 of such signals, the royalty rates established by

15 section 111(d)(1)(B) may be adjusted to ensure

16 that the rates for the additional distant signal

17 equivalents resulting from such carriage are rea18 sonable in the light of the changes effected by the

19 amendment to such rules and regulations. In de20 termining the reasonableness of rates proposed

21 following an amendment of Federal Communica22 tions Commission rules and regulations, the

23 Copyright Royalty Judges shall consider, among

24 other factors, the economic impact on copyright

25 owners and users; except that no adjustment in
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1 royalty rates shall be made under this subpara2 graph with respect to any distant signal equiva3 lent or fraction thereof represented by—

4 ‘‘(i) carriage of any signal permitted

5 under the rules and regulations of the Fed6 eral Communications Commission in effect

7 on April 15, 1976, or the carriage of a sig8 nal of the same type (that is, independent,

9 network, or noncommercial educational)

10 substituted for such permitted signal; or

11 ‘‘(ii) a television broadcast signal first

12 carried after April 15, 1976, pursuant to an

13 individual waiver of the rules and regula14 tions of the Federal Communications Com15 mission, as such rules and regulations were

16 in effect on April 15, 1976.

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

18 and regulations of the Federal Communications

19 Commission with respect to syndicated and

20 sports program exclusivity after April 15, 1976,

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

22 be adjusted to assure that such rates are reason23 able in light of the changes to such rules and reg24 ulations, but any such adjustment shall apply
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1 only to the affected television broadcast signals

2 carried on those systems affected by the change.

3 ‘‘(D) The gross receipts limitations estab4 lished by section 111(d)(1) (C) and (D) shall be

5 adjusted to reflect national monetary inflation or

6 deflation or changes in the average rates charged

7 cable system subscribers for the basic service of

8 providing secondary transmissions to maintain

9 the real constant dollar value of the exemption

10 provided by such section, and the royalty rate

11 specified therein shall not be subject to adjust12 ment.

13 ‘‘(3)(A) To authorize the distribution, under sec14 tions 111, 119, and 1007, of those royalty fees col15 lected under sections 111, 119, and 1005, as the case

16 may be, to the extent that the Copyright Royalty

17 Judges have found that the distribution of such fees

18 is not subject to controversy.

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

20 Judges determine that controversy exists, the Copy21 right Royalty Judges shall determine the distribution

22 of such fees, including partial distributions, in ac23 cordance with section 111, 119, or 1007, as the case

24 may be.
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1 ‘‘(C) The Copyright Royalty Judges may make a

2 partial distribution of such fees during the pendency

3 of the proceeding under subparagraph (B) if all par4 ticipants under section 803(b)(2) in the proceeding

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

6 partially distributed—

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

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

9 return any excess amounts to the extent nec10 essary to comply with the final determination on

11 the distribution of the fees made under subpara12 graph (B);

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

14 Royalty Judges; and

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

16 distribution.

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

18 other officer or employee acting in good faith in dis19 tributing funds under subparagraph (C) shall not be

20 held liable for the payment of any excess fees under

21 subparagraph (C). The Copyright Royalty Judges

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

23 calculate any such excess amounts.

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

25 under sections 111, 119, and 1007, on the basis of
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1 timeliness or the failure to establish the basis for a

2 claim.

3 ‘‘(5) To accept or reject rate adjustment petitions

4 as provided in section 804 and petitions to partici5 pate as provided in section 803(b) (1) and (2).

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

7 recording device or a digital audio interface device

8 under sections 1002 and 1003, as provided in section

9 1010.

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

11 and rates or as a basis for the distribution of statu12 tory royalty payments, an agreement concerning such

13 matters reached among some or all of the participants

14 in a proceeding at any time during the proceeding,

15 except that—

16 ‘‘(i) the Copyright Royalty Judges shall

17 provide to those that would be bound by the

18 terms, rates, or other determination set by any

19 agreement in a proceeding to determine royalty

20 rates an opportunity to comment on the agree21 ment and shall provide to the other participants

22 in the proceeding under section 803(b)(2) that

23 would be bound by the terms, rates, or other de24 termination set by the agreement an opportunity

25 to comment on the agreement and object to its
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1 adoption as a basis for statutory terms and

2 rates; and

3 ‘‘(ii) the Copyright Royalty Judges may de4 cline to adopt the agreement as a basis for statu5 tory terms and rates for participants that are

6 not parties to the agreement, if any other partic7 ipant described in subparagraph (A) objects to

8 the agreement and the Copyright Royalty Judges

9 conclude, based on the record before them if one

10 exists, that the agreement does not provide a rea11 sonable basis for setting statutory terms or rates.

12 ‘‘(B) License agreements voluntarily negotiated

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

14 115(c)(3)(E)(i), 116(c), or 118(b) (2) or (3) that do

15 not result in statutory terms and rates shall not be

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

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

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

19 agreement that specifies as terms notice and record20 keeping requirements that apply in lieu of those that

21 would otherwise apply under regulations.

22 ‘‘(8) To perform other duties, as assigned by the

23 Register of Copyrights within the Library of Con24 gress, except as provided in section 802(g) at times
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1 when Copyright Royalty Judges are not engaged in

2 performing the other duties set forth in this section.

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

4 Copyright Royalty Judges may make any necessary proce5 dural or evidentiary rulings in any proceeding under this

6 chapter and may, before commencing a proceeding under

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

8 the proceedings conducted by the Copyright Royalty Judges.

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

10 Congress shall provide the Copyright Royalty Judges with

11 the necessary administrative services related to proceedings

12 under this chapter.

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

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

15 Library of Congress.

16 ‘‘§ 802. Copyright Royalty Judgeships; staff

17 ‘‘(a) QUALIFICATIONS OF COPYRIGHT ROYALTY

18 JUDGES.—

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

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

21 of legal experience. The Chief Copyright Royalty

22 Judge shall have at least 5 years of experience in ad23 judications, arbitrations, or court trials. Of the other

24 two Copyright Royalty Judges, one shall have signifi25 cant knowledge of copyright law, and the other shall
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1 have significant knowledge of economics. An indi2 vidual may serve as a Copyright Royalty Judge only

3 if the individual is free of any financial conflict of

4 interest under subsection (h).

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

6 ‘adjudication’ has the meaning given that term in

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

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

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

10 Royalty Judges in performing their functions.

11 ‘‘(c) TERMS.—The individual first appointed the Chief

12 Copyright Royalty Judge shall be appointed to a term of

13 6 years, and of the remaining individuals first appointed

14 Copyright Royalty Judges, 1 shall be appointed to a term

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

16 2 years. Thereafter, the terms of succeeding Copyright Roy17 alty Judges shall each be 6 years. An individual serving

18 as a Copyright Royalty Judge may be reappointed to subse19 quent terms. The term of a Copyright Royalty Judge shall

20 begin when the term of the predecessor of that Copyright

21 Royalty Judge ends. When the term of office of a Copyright

22 Royalty Judge ends, the individual serving that term may

23 continue to serve until a successor is selected.

24 ‘‘(d) VACANCIES OR INCAPACITY.—
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1 ‘‘(1) VACANCIES.—If a vacancy should occur in

2 the position of Copyright Royalty Judge, the Librar3 ian of Congress shall act expeditiously to fill the va4 cancy, and may appoint an interim Copyright Roy5 alty Judge to serve until another Copyright Royalty

6 Judge is appointed under this section. An individual

7 appointed to fill the vacancy occurring before the ex8 piration of the term for which the predecessor of that

9 individual was appointed shall be appointed for the

10 remainder of that term.

11 ‘‘(2) INCAPACITY.—In the case in which a Copy12 right Royalty Judge is temporarily unable to perform

13 his or her duties, the Librarian of Congress may ap14 point an interim Copyright Royalty Judge to perform

15 such duties during the period of such incapacity.

16 ‘‘(e) COMPENSATION.—

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

18 Judge shall receive compensation at the rate of basic

19 pay payable for level AL–1 for administrative law

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

21 of the other two Copyright Royalty Judges shall re22 ceive compensation at the rate of basic pay payable

23 for level AL–2 for administrative law judges pursuant

24 to such section. The compensation of the Copyright

25 Royalty Judges shall not be subject to any regulations
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1 adopted by the Office of Personnel Management pur2 suant to its authority under section 5376(b)(1) of title

3 5.

4 ‘‘(2) STAFF MEMBERS.—Of the staff members ap5 pointed under subsection (b)—

6 ‘‘(A) the rate of pay of 1 staff member shall

7 be not more than the basic rate of pay payable

8 for level 10 of GS–15 of the General Schedule;

9 ‘‘(B) the rate of pay of 1 staff member shall

10 be not less than the basic rate of pay payable for

11 GS–13 of the General Schedule and not more

12 than the basic rate of pay payable for level 10

13 of GS–14 of such Schedule; and

14 ‘‘(C) the rate of pay for the third staff mem15 ber shall be not less than the basic rate of pay

16 payable for GS–8 of the General Schedule and

17 not more than the basic rate of pay payable for

18 level 10 of GS–11 of such Schedule.

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

20 under this subsection shall include locality pay.

21 ‘‘(f) INDEPENDENCE OF COPYRIGHT ROYALTY

22 JUDGE.—

23 ‘‘(1) IN MAKING DETERMINATIONS.—

24 ‘‘(A) IN GENERAL.—(i) Subject to clause

25 (ii) of this subparagraph and subparagraph (B),
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1 the Copyright Royalty Judges shall have full

2 independence in making determinations con3 cerning adjustments and determinations of copy4 right royalty rates and terms, the distribution of

5 copyright royalties, the acceptance or rejection of

6 royalty claims, rate adjustment petitions, and

7 petitions to participate, and in issuing other rul8 ings under this title, except that the Copyright

9 Royalty Judges may consult with the Register of

10 Copyrights on any matter other than a question

11 of fact.

12 ‘‘(ii) A Copyright Royalty Judge or Judges,

13 or, by motion to the Copyright Royalty Judge or

14 Judges, any participant in a proceeding may re15 quest an interpretation by the Register of Copy16 rights concerning any material question of sub17 stantive law (not including questions of proce18 dure before the Copyright Royalty Judges, the ul19 timate adjustments and determinations of copy20 right royalty rates and terms, the ultimate dis21 tribution of copyright royalties, or the accept22 ance or rejection of royalty claims, rate adjust23 ment petitions, or petitions to participate) con24 cerning an interpretation or construction of

25 those provisions of this title that are the subject
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1 of the proceeding. Any such request for a written

2 interpretation by the Register of Copyrights shall

3 be on the record. Reasonable provision shall be

4 made for comment by the participants in the

5 proceeding on the material question of sub6 stantive law in such a way as to minimize du7 plication and delay. Except as provided in sub8 paragraph (B), the Register of Copyrights shall

9 deliver to the Copyright Royalty Judges a re10 sponse within 14 days of receipt by the Register

11 of Copyrights of all of the briefs or comments of

12 the participants. Such decision shall be in writ13 ing and shall be included by the Copyright Roy14 alty Judges in the record that accompanies their

15 final determination. If such a decision is timely

16 delivered to the Copyright Royalty Judges, the

17 Copyright Royalty Judges shall apply the legal

18 interpretation embodied in the response of the

19 Register of Copyrights in resolving material

20 questions of substantive law.

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

22 in which a novel material question of substantive

23 law concerning an interpretation of those provi24 sions of this title that are the subject of the pro25 ceeding is presented, the Copyright Royalty
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1 Judges shall request a decision of the Register of

2 Copyrights, in writing, to resolve such novel

3 question. Reasonable provision shall be made for

4 comment on such request by the participants in

5 the proceeding, in such a way as to minimize

6 duplication and delay. The Register shall trans7 mit his or her decision to the Copyright Royalty

8 Judges within 30 days of receipt by the Register

9 of Copyrights of all of the briefs or comments of

10 the participants. Such decision shall be in writ11 ing and included by the Copyright Royalty

12 Judges in the record that accompanies their final

13 determination. If such a decision is timely deliv14 ered, the Copyright Royalty Judges shall apply

15 the legal determinations embodied in the decision

16 of the Register of Copyrights in resolving mate17 rial questions of substantive law.

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

19 is a question of law that has not been determined

20 in prior decisions, determinations, and rulings

21 described in section 803(a).

22 ‘‘(C) CONSULTATION.—Notwithstanding the

23 provisions of subparagraph (A), the Copyright

24 Royalty Judges shall consult with the Register of

25 Copyrights with respect to any determination or
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1 ruling that would require that any act be per2 formed by the Copyright Office, and any such de3 termination or ruling shall not be binding upon

4 the Register of Copyrights.

5 ‘‘(D) REVIEW OF LEGAL CONCLUSIONS BY

6 THE REGISTER OF COPYRIGHTS.—The Register

7 of Copyrights may review for legal error the reso8 lution by the Copyright Royalty Judges of a ma9 terial question of substantive law under this title

10 that underlies or is contained in a final deter11 mination of the Copyright Royalty Judges. If the

12 Register of Copyrights concludes, after taking

13 into consideration the views of the participants

14 in the proceeding, that any resolution reached by

15 the Copyright Royalty Judges was in material

16 error, the Register of Copyrights shall issue a

17 written decision correcting such legal error,

18 which shall be made part of the record of the

19 proceeding. Additionally, the Register of Copy20 rights shall cause to be published in the Federal

21 Register such written decision together with a

22 specific identification of the legal conclusion of

23 the Copyright Royalty Judges that is determined

24 to be erroneous. As to conclusions of substantive

25 law involving an interpretation of the statutory
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1 provisions of this title, the decision of the Reg2 ister of Copyrights shall be binding as precedent

3 upon the Copyright Royalty Judges in subse4 quent proceedings under this chapter. When a

5 decision has been rendered pursuant to section

6 802(f)(1)(D), the Register of Copyrights may, on

7 the basis of and in accordance with such deci8 sion, intervene as of right in any appeal of a

9 final determination of the Copyright Royalty

10 Judges pursuant to section 803(d) in the United

11 States Court of Appeals for the District of Co12 lumbia Circuit. If, prior to intervening in such

13 an appeal, the Register of Copyrights gives noti14 fication and undertakes to consult with the At15 torney General with respect to such intervention,

16 and the Attorney General fails within reasonable

17 period after receipt of such notification to inter18 vene in such appeal, the Register of Copyrights

19 may intervene in such appeal in his or her own

20 name by any attorney designated by the Register

21 of Copyrights for such purpose. Intervention by

22 the Register of Copyrights in his or her own

23 name shall not preclude the Attorney General

24 from intervening on behalf of the United States
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1 in such an appeal as may be otherwise provided

2 or required by law.

3 ‘‘(E) EFFECT ON JUDICIAL REVIEW.—Noth4 ing in this section shall be interpreted to alter

5 the standard applied by a court in reviewing

6 legal determinations involving an interpretation

7 or construction of the provisions of this title or

8 to affect the extent to which any construction or

9 interpretation of the provisions of this title shall

10 be accorded deference by a reviewing court.

11 ‘‘(2) PERFORMANCE APPRAISALS.—

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

13 other provision of law or any regulation of the

14 Library of Congress, and subject to subpara15 graph (B), the Copyright Royalty Judges shall

16 not receive performance appraisals.

17 ‘‘(B) RELATING TO SANCTION OR RE18 MOVAL.—To the extent that the Librarian of

19 Congress adopts regulations under subsection (h)

20 relating to the sanction or removal of a Copy21 right Royalty Judge and such regulations re22 quire documentation to establish the cause of

23 such sanction or removal, the Copyright Royalty

24 Judge may receive an appraisal related specifi25 cally to the cause of the sanction or removal.
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1 ‘‘(g) INCONSISTENT DUTIES BARRED.—No Copyright

2 Royalty Judge may undertake duties that conflict with his

3 or her duties and responsibilities as a Copyright Royalty

4 Judge.

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

6 Congress shall adopt regulations regarding the standards

7 of conduct, including financial conflict of interest and re8 strictions against ex parte communications, which shall

9 govern the Copyright Royalty Judges and the proceedings

10 under this chapter.

11 ‘‘(i) REMOVAL OR SANCTION.—The Librarian of Con12 gress may sanction or remove a Copyright Royalty Judge

13 for violation of the standards of conduct adopted under sub14 section (h), misconduct, neglect of duty, or any disquali15 fying physical or mental disability. Any such sanction or

16 removal may be made only after notice and opportunity

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

18 the Copyright Royalty Judge during the pendency of such

19 hearing. The Librarian shall appoint an interim Copyright

20 Royalty Judge during the period of any such suspension.

21 ‘‘§ 803. Proceedings of Copyright Royalty Judges

22 ‘‘(a) PROCEEDINGS.—

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

24 Judges shall act in accordance with regulations issued

25 by the Copyright Royalty Judges and the Librarian
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1 of Congress, and on the basis of a written record,

2 prior determinations and interpretations of the Copy3 right Royalty Tribunal, Librarian of Congress, copy4 right arbitration royalty panels, the Register of Copy5 rights, and the Copyright Royalty Judges (to the ex6 tent those determinations are not inconsistent with a

7 decision of the Register of Copyrights that was timely

8 delivered to the Copyright Royalty Judges pursuant

9 to section 802(f)(1) (A) or (B), or with a decision of

10 the Register of Copyrights pursuant to section

11 802(f)(1)(D)), under this chapter, and decisions of the

12 court of appeals under this chapter before, on, or after

13 the effective date of the Copyright Royalty and Dis14 tribution 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 a determination

10 made under section 804(a), or no later than Jan11 uary 5 of a year specified in section 804(b) (2)

12 or (3), or as provided under section 804(b)(8), or

13 by no later than January 5 of a year specified

14 in section 804 for the commencement of a pro15 ceeding if a petition has not been filed by that

16 date, the Copyright Royalty Judges shall cause

17 to be published in the Federal Register notice of

18 commencement of proceedings under this chapter

19 calling for the filing of petitions to participate

20 in a proceeding under this chapter for the pur21 pose of making the relevant determination under

22 section 111, 112, 114, 115, 116, 118, 119, 1004,

23 or 1007, as the case 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) BADFAITH 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 not earlier than 4 months,

12 and not later than 5 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 or written rebuttal statement of

7 that participant. Any objection to such a

8 request shall be resolved by a motion or re9 quest to compel production made to the

10 Copyright Royalty Judges according to reg11 ulations adopted by the Copyright Royalty

12 Judges. Each motion or request to compel

13 discovery shall be determined by the Copy14 right Royalty Judges, or by a Copyright

15 Royalty Judge when permitted under sub16 section (a)(2). Upon such motion, the Copy17 right Royalty Judges may order discovery

18 pursuant to regulations established under

19 this paragraph.

20 ‘‘(vi)(I) Any participant under para21 graph (2) in a proceeding under this chap22 ter to determine royalty rates may, by

23 means of written motion or on the record,

24 request of an opposing participant or wit25 ness other relevant information and mate-
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1 rials if absent the discovery sought the

2 Copyright Royalty Judges’ resolution of the

3 proceeding would be substantially impaired.

4 In determining whether discovery will be

5 granted under this clause, the Copyright

6 Royalty Judges may consider—

7 ‘‘(aa) whether the burden or ex8 pense of producing the requested infor9 mation or materials outweighs the like10 ly benefit, taking into account the

11 needs and resources of the participants,

12 the importance of the issues at stake,

13 and the probative value of the re14 quested information or materials in re15 solving such issues;

16 ‘‘(bb) whether the requested infor17 mation or materials would be unrea18 sonably cumulative or duplicative, or

19 are obtainable from another source that

20 is more convenient, less burdensome, or

21 less expensive; and

22 ‘‘(cc) whether the participant seek23 ing discovery has had ample oppor24 tunity by discovery in the proceeding
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1 or by other means to obtain the infor2 mation sought.

3 ‘‘(II) This clause shall not apply to

4 any proceeding scheduled to commence after

5 December 31, 2010.

6 ‘‘(vii) In a proceeding under this chap7 ter to determine royalty rates, the partici8 pants entitled to receive royalties shall col9 lectively be permitted to take no more than

10 10 depositions and secure responses to no

11 more than 25 interrogatories and the par12 ticipants obligated to pay royalties shall

13 collectively be permitted to take no more

14 than 10 depositions and secure responses to

15 no more than 25 interrogatories. The Copy16 right Royalty Judges shall resolve any dis17 putes among similarly aligned participants

18 to allocate the number of depositions or in19 terrogatories permitted under this clause.

20 ‘‘(viii) The rules and practices in effect

21 on the day before the effective date of the

22 Copyright Royalty and Distribution Reform

23 Act of 2004, relating to discovery in pro24 ceedings under this chapter to determine the

25 distribution of royalty fees, shall continue to
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1 apply to such proceedings on and after such

2 effective date.

3 ‘‘(ix) In proceedings to determine roy4 alty rates, the Copyright Royalty Judges

5 may issue a subpoena commanding a par6 ticipant or witness to appear and give testi7 mony or to produce and permit inspection

8 of documents or tangible things if the Copy9 right Royalty Judges’ resolution of the pro10 ceeding would be substantially impaired by

11 the absence of such testimony or production

12 of documents or tangible things. Such sub13 poena shall specify with reasonable particu14 larity the materials to be produced or the

15 scope and nature of the required testimony.

16 Nothing in this subparagraph shall preclude

17 the Copyright Royalty Judges from request18 ing the production by a nonparticipant of

19 information or materials relevant to the res20 olution by the Copyright Royalty Judges of

21 a material issue of fact.

22 ‘‘(x) The Copyright Royalty Judges

23 shall order a settlement conference among

24 the participants in the proceeding to facili25 tate the presentation of offers of settlement
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1 among the participants. The settlement con2 ference shall be held during a 21-day period

3 following the end of the discovery period

4 and shall take place outside the presence of

5 the Copyright Royalty Judges.

6 ‘‘(xi) No evidence, including exhibits,

7 may be submitted in the written direct

8 statement or written rebuttal statement of a

9 participant without a sponsoring witness,

10 except where the Copyright Royalty Judges

11 have taken official notice, or in the case of

12 incorporation by reference of past records,

13 or for good cause shown.

14 ‘‘(c) DETERMINATION OF COPYRIGHT ROYALTY

15 JUDGES.—

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

17 shall issue their determination in a proceeding not

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

19 day settlement conference period under subsection

20 (b)(3)(C)(x), but, in the case of a proceeding to deter21 mine successors to rates or terms that expire on a

22 specified date, in no event later than 15 days before

23 the expiration of the then current statutory rates and

24 terms.

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

2 Judges may, in exceptional cases, upon motion

3 of a participant under subsection (b)(2), order a

4 rehearing, after the determination in a pro5 ceeding is issued under paragraph (1), on such

6 matters as the Copyright Royalty Judges deter7 mine to be appropriate.

8 ‘‘(B) TIMING FOR FILING MOTION.—Any

9 motion for a rehearing under subparagraph (A)

10 may only be filed within 15 days after the date

11 on which the Copyright Royalty Judges deliver

12 their initial determination concerning rates and

13 terms to the participants in the proceeding.

14 ‘‘(C) PARTICIPATION BY OPPOSING PARTY

15 NOT REQUIRED.—In any case in which a rehear16 ing is ordered, any opposing party shall not be

17 required to participate in the rehearing, except

18 as provided under subsection (d)(1).

19 ‘‘(D) NO NEGATIVE INFERENCE.—No nega20 tive inference shall be drawn from lack of par21 ticipation in a rehearing.

22 ‘‘(E) CONTINUITY OF RATES ANDTERMS.—

23 (i) If the decision of the Copyright Royalty

24 Judges on any motion for a rehearing is not ren25 dered before the expiration of the statutory rates
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1 and terms that were previously in effect, in the

2 case of a proceeding to determine successors to

3 rates and terms that expire on a specified date,

4 then—

5 ‘‘(I) the initial determination of the

6 Copyright Royalty Judges that is the sub7 ject of the rehearing motion shall be effective

8 as of the day following the date on which

9 the rates and terms that were previously in

10 effect expire; and

11 ‘‘(II) in the case of a proceeding under

12 section 114(f)(1)(C) or 114(f)(2)(C), royalty

13 rates and terms shall, for purposes of sec14 tion 114(f)(4)(B), be deemed to have been

15 set at those rates and terms contained in the

16 initial determination of the Copyright Roy17 alty Judges that is the subject of the rehear18 ing motion, as of the date of that deter19 mination.

20 ‘‘(ii) The pendency of a motion for a re21 hearing under this paragraph shall not relieve

22 persons obligated to make royalty payments who

23 would be affected by the determination on that

24 motion from providing the statements of account

25 and any reports of use, to the extent required,
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1 and paying the royalties required under the rel2 evant determination or regulations.

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

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

5 person other than the Copyright Office, the entity

6 designated by the Copyright Royalty Judges to

7 which such royalties are paid by the copyright

8 user (and any successor thereto) shall, within 60

9 days after the motion for rehearing is resolved

10 or, if the motion is granted, within 60 days after

11 the rehearing is concluded, return any excess

12 amounts previously paid to the extent necessary

13 to comply with the final determination of roy14 alty rates by the Copyright Royalty Judges. Any

15 underpayment of royalties resulting from a re16 hearing shall be paid within the same period.

17 ‘‘(3) CONTENTS OF DETERMINATION.—A deter18 mination of the Copyright Royalty Judges shall be

19 supported by the written record and shall set forth the

20 findings of fact relied on by the Copyright Royalty

21 Judges. Among other terms adopted in a determina22 tion, the Copyright Royalty Judges may specify no23 tice and recordkeeping requirements of users of the

24 copyrights at issue that apply in lieu of those that

25 would otherwise apply under regulations.
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1 ‘‘(4) CONTINUING JURISDICTION.—The Copyright

2 Royalty Judges may, with the approval of the Reg3 ister of Copyrights, issue an amendment to a written

4 determination to correct any technical or clerical er5 rors in the determination or to modify the terms, but

6 not the rates, of royalty payments in response to un7 foreseen circumstances that would frustrate the proper

8 implementation of such determination. Such amend9 ment shall be set forth in a written addendum to the

10 determination that shall be distributed to the partici11 pants of the proceeding and shall be published in the

12 Federal Register.

13 ‘‘(5) PROTECTIVE ORDER.—The Copyright Roy14 alty Judges may issue such orders as may be appro15 priate to protect confidential information, including

16 orders excluding confidential information from the

17 record of the determination that is published or made

18 available to the public, except that any terms or rates

19 of royalty payments or distributions may not be ex20 cluded.

21 ‘‘(6) PUBLICATION OF DETERMINATION.—Fol22 lowing review of the determination by the Register of

23 Copyrights under section 802(f)(1)(D), the Librarian

24 of Congress shall cause the determination, and any

25 corrections thereto, to be published in the Federal
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1 Register. The Librarian of Congress shall also pub2 licize the determination and corrections in such other

3 manner as the Librarian considers appropriate, in4 cluding, but not limited to, publication on the Inter5 net. The Librarian of Congress shall also make the de6 termination, 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 participant that did not partici23 pate in a rehearing may not raise any issue that was

24 the subject of that rehearing at any stage of judicial

25 review of the hearing determination. If no appeal is
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1 brought within that 30-day period, the determination

2 of the Copyright Royalty Judges shall be final, and

3 the royalty fee or determination with respect to the

4 distribution of fees, as the case may be, shall take ef5 fect as set forth in paragraph (2).

6 ‘‘(2) EFFECT OF RATES.—

7 ‘‘(A) EXPIRATION ON SPECIFIEDDATE.—

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. A transmission serv18 ice shall be obligated to continue making pay19 ments under the rates and terms previously in

20 effect until such time as rates and terms for the

21 successor period are established. Whenever royal22 ties pursuant to this section are paid to a person

23 other than the Copyright Office, the entity des24 ignated by the Copyright Royalty Judges to

25 which such royalties are paid by the copyright
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1 user (and any successor thereto) shall, within 60

2 days after the final determination of the Copy3 right Royalty Judges establishing rates and

4 terms for a successor period or the exhaustion of

5 all rehearings or appeals of such determination,

6 if any, return any excess amounts previously

7 paid to the extent necessary to comply with the

8 final determination of royalty rates. Any under9 payment of royalties by a copyright user shall be

10 paid to the entity designated by the Copyright

11 Royalty Judges within the same period.

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

13 and terms have not, prior to the inception of an

14 activity, been established for that particular ac15 tivity under the relevant license, such rates and

16 terms shall be retroactive to the inception of ac17 tivity under the relevant license covered by such

18 rates and terms. In other cases where rates and

19 terms do not expire on a specified date, successor

20 rates and terms shall take effect on the first day

21 of the second month that begins after the publica22 tion of the determination of the Copyright Roy23 alty Judges in the Federal Register, except as

24 otherwise provided in this title, or by the Copy25 right Royalty Judges, or as agreed by the par-
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1 ticipants in a proceeding that would be bound by

2 the rates and terms. Except as otherwise pro3 vided in this title, the rates and terms, to the ex4 tent applicable, shall remain in effect until such

5 successor rates and terms become effective.

6 ‘‘(C) OBLIGATION TO MAKE PAYMENTS.—

7 ‘‘(i) The pendency of an appeal under

8 this subsection shall not relieve persons obli9 gated to make royalty payments under sec10 tion 111, 112, 114, 115, 116, 118, 119, or

11 1003, who would be affected by the deter12 mination on appeal, from—

13 ‘‘(I) providing the statements of

14 account and any report of use; and

15 ‘‘(II) paying the royalties re16 quired under the relevant determina17 tion or regulations.

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

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

20 person other than the Copyright Office, the entity

21 designated by the Copyright Royalty Judges to

22 which such royalties are paid by the copyright

23 user (and any successor thereto) shall, within 60

24 days after the final resolution of the appeal, re25 turn any excess amounts previously paid (and
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1 interest thereon, if ordered pursuant to para2 graph (3)) to the extent necessary to comply with

3 the final determination of royalty rates on ap4 peal. Any underpayment of royalties resulting

5 from an appeal (and interest thereon, if ordered

6 pursuant to paragraph (3)) shall be paid within

7 the same period.

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

9 pursuant to section 706 of title 5, modifies or vacates

10 a determination of the Copyright Royalty Judges, the

11 court may enter its own determination with respect

12 to the amount or distribution of royalty fees and

13 costs, and order the repayment of any excess fees, the

14 payment of any underpaid fees, and the payment of

15 interest pertaining respectively thereto, in accordance

16 with its final judgment. The court may also vacate

17 the determination of the Copyright Royalty Judges

18 and remand the case to the Copyright Royalty Judges

19 for further proceedings in accordance with subsection

20 (a).

21 ‘‘(e) ADMINISTRATIVE MATTERS.—

22 ‘‘(1) DEDUCTION OF COSTS OF LIBRARY OF CON23 GRESS ANDCOPYRIGHT OFFICE FROM FILING FEES.—

24 ‘‘(A) DEDUCTION FROM FILING FEES.—The

25 Librarian of Congress may, to the extent not oth-
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1 erwise provided under this title, deduct from the

2 filing fees collected under subsection (b) for a

3 particular proceeding under this chapter the rea4 sonable costs incurred by the Librarian of Con5 gress, the Copyright Office, and the Copyright

6 Royalty Judges in conducting that proceeding,

7 other than the salaries of the Copyright Royalty

8 Judges and the 3 staff members appointed under

9 section 802(b).

10 ‘‘(B) AUTHORIZATION OF APPROPRIA11 TIONS.—There are authorized to be appropriated

12 such sums as may be necessary to pay the costs

13 incurred under this chapter not covered by the

14 filing fees collected under subsection (b). All

15 funds made available pursuant to this subpara16 graph shall remain available until expended.

17 ‘‘(2) POSITIONS REQUIREDFOR ADMINISTRATION

18 OF COMPULSORY LICENSING.—Section 307 of the Leg19 islative Branch Appropriations Act, 1994, shall not

20 apply to employee positions in the Library of Con21 gress that are required to be filled in order to carry

22 out section 111, 112, 114, 115, 116, 118, or 119 or

23 chapter 10.
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1 ‘‘§ 804. Institution of proceedings

2 ‘‘(a) FILING OF PETITION.—With respect to pro3 ceedings referred to in paragraphs (1) and (2) of section

4 801(b) concerning the determination or adjustment of roy5 alty rates as provided in sections 111, 112, 114, 115, 116,

6 118, 119, and 1004, during the calendar years specified in

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

8 of a copyrighted work whose royalty rates are specified by

9 this title, or are established under this chapter before or

10 after the enactment of the Copyright Royalty and Distribu11 tion Reform Act of 2004, may file a petition with the Copy12 right Royalty Judges declaring that the petitioner requests

13 a determination or adjustment of the rate. The Copyright

14 Royalty Judges shall make a determination as to whether

15 the petitioner has such a significant interest in the royalty

16 rate in which a determination or adjustment is requested.

17 If the Copyright Royalty Judges determine that the peti18 tioner has such a significant interest, the Copyright Roy19 alty Judges shall cause notice of this determination, with

20 the reasons for such determination, to be published in the

21 Federal Register, together with the notice of commencement

22 of proceedings under this chapter. With respect to pro23 ceedings under paragraph (1) of section 801(b) concerning

24 the determination or adjustment of royalty rates as pro25 vided in sections 112 and 114, during the calendar years

26 specified in the schedule set forth in subsection (b), the
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1 Copyright Royalty Judges shall cause notice of commence2 ment of proceedings under this chapter to be published in

3 the Federal Register as provided in section 803(b)(1)(A).

4 ‘‘(b) TIMING OF PROCEEDINGS.—

5 ‘‘(1) SECTION 111 PROCEEDINGS.—(A) A petition

6 described in subsection (a) to initiate proceedings

7 under section 801(b)(2) concerning the adjustment of

8 royalty rates under section 111 to which subpara9 graph (A) or (D) of section 801(b)(2) applies may be

10 filed during the year 2005 and in each subsequent

11 fifth calendar year.

12 ‘‘(B) In order to initiate proceedings under sec13 tion 801(b)(2) concerning the adjustment of royalty

14 rates under section 111 to which subparagraph (B) or

15 (C) of section 801(b)(2) applies, within 12 months

16 after an event described in either of those subsections,

17 any owner or user of a copyrighted work whose roy18 alty rates are specified by section 111, or by a rate

19 established under this chapter before or after the en20 actment of the Copyright Royalty and Distribution

21 Reform Act of 2004, may file a petition with the

22 Copyright Royalty Judges declaring that the peti23 tioner requests an adjustment of the rate. The Copy24 right Royalty Judges shall then proceed as set forth

25 in subsection (a) of this section. Any change in roy-
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1 alty rates made under this chapter pursuant to this

2 subparagraph may be reconsidered in the year 2005,

3 and each fifth calendar year thereafter, in accordance

4 with the provisions in section 801(b)(3) (B) or (C),

5 as the case may be. A petition for adjustment of rates

6 established by section 111(d)(1)(B) as a result of a

7 change is the rules and regulations of the Federal

8 Communications Commission shall set forth the

9 change on which the petition is based.

10 ‘‘(C) Any adjustment of royalty rates under sec11 tion 111 shall take effect as of the first accounting pe12 riod commencing after the publication of the deter13 mination of the Copyright Royalty Judges in the Fed14 eral Register, or on such other date as is specified in

15 that determination.

16 ‘‘(2) CERTAIN SECTION 112 PROCEEDINGS.—Pro17 ceedings under this chapter shall be commenced in the

18 year 2007 to determine reasonable terms and rates of

19 royalty payments for the activities described in sec20 tion 112(e)(1) relating to the limitation on exclusive

21 rights specified by section 114(d)(1)(C)(iv), to become

22 effective on January 1, 2009. Such proceedings shall

23 be repeated in each subsequent fifth calendar year.

24 ‘‘(3) SECTION 114 ANDCORRESPONDING 112 PRO25 CEEDINGS.—
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1 ‘‘(A) FOR ELIGIBLE NONSUBSCRIPTION

2 SERVICES ANDNEW SUBSCRIPTION SERVICES.—

3 Proceedings under this chapter shall be com4 menced as soon as practicable after the effective

5 date of the Copyright Royalty and Distribution

6 Reform Act of 2004 to determine reasonable

7 terms and rates of royalty payments under sec8 tions 114 and 112 for the activities of eligible

9 nonsubscription transmission services and new

10 subscription services, to be effective for the period

11 beginning on January 1, 2006, and ending on

12 December 31, 2010. Such proceedings shall next

13 be commenced in January 2009 to determine

14 reasonable terms and rates of royalty payments,

15 to become effective on January 1, 2011. There16 after, such proceedings shall be repeated in each

17 subsequent fifth calendar year.

18 ‘‘(B) FOR PREEXISTING SUBSCRIPTION AND

19 SATELLITE DIGITAL AUDIO RADIO SERVICES.—

20 Proceedings under this chapter shall be com21 menced in January 2006 to determine reasonable

22 terms and rates of royalty payments under sec23 tions 114 and 112 for the activities of pre24 existing subscription services, to be effective dur25 ing the period beginning on January 1, 2008,
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1 and ending on December 31, 2012, and pre2 existing satellite digital audio radio services, to

3 be effective during the period beginning on Janu4 ary 1, 2007, and ending on December 31, 2012.

5 Such proceedings shall next be commenced in

6 2011 to determine reasonable terms and rates of

7 royalty payments, to become effective on Janu8 ary 1, 2013. Thereafter, such proceedings shall be

9 repeated in each subsequent fifth calendar year.

10 ‘‘(C)(i) Notwithstanding any other provi11 sion of this chapter, this subparagraph shall gov12 ern proceedings commenced pursuant to section

13 114(f)(1)(C) and 114(f)(2)(C) concerning new

14 types of services.

15 ‘‘(ii) Not later than 30 days after a petition

16 to determine rates and terms for a new type of

17 service that is filed by any copyright owner of

18 sound recordings, or such new type of service, in19 dicating that such new type of service is or is

20 about to become operational, the Copyright Roy21 alty Judges shall issue a notice for a proceeding

22 to determine rates and terms for such service.

23 ‘‘(iii) The proceeding shall follow the sched24 ule set forth in such subsections (b), (c), and (d)

25 of section 803, except that—
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1 ‘‘(I) the determination shall be issued

2 by not later than 24 months after the publi3 cation of the notice under clause (ii); and

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

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

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

7 (C).

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

9 effect for the period set forth in section

10 114(f)(1)(C) or 114(f)(2)(C), as the case may be.

11 ‘‘(4) SECTION 115 PROCEEDINGS.—A petition de12 scribed in subsection (a) to initiate proceedings under

13 section 801(b)(1) concerning the adjustment or deter14 mination of royalty rates as provided in section 115

15 may be filed in the year 2006 and in each subsequent

16 fifth calendar year, or at such other times as the par17 ties have agreed under section 115(c)(3) (B) and (C).

18 ‘‘(5) SECTION 116 PROCEEDINGS.—(A) A petition

19 described in subsection (a) to initiate proceedings

20 under section 801(b) concerning the determination of

21 royalty rates and terms as provided in section 116

22 may be filed at any time within 1 year after nego23 tiated licenses authorized by section 116 are termi24 nated or expire and are not replaced by subsequent

25 agreements.
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1 ‘‘(B) If a negotiated license authorized by section

2 116 is terminated or expires and is not replaced by

3 another such license agreement which provides per4 mission to use a quantity of musical works not sub5 stantially smaller than the quantity of such works

6 performed on coin-operated phonorecord players dur7 ing the 1-year period ending March 1, 1989, the

8 Copyright Royalty Judges shall, upon petition filed

9 under paragraph (1) within 1 year after such termi10 nation or expiration, commence a proceeding to

11 promptly establish an interim royalty rate or rates

12 for the public performance by means of a coin-oper13 ated phonorecord player of nondramatic musical

14 works embodied in phonorecords which had been sub15 ject to the terminated or expired negotiated license

16 agreement. Such rate or rates shall be the same as the

17 last such rate or rates and shall remain in force until

18 the conclusion of proceedings by the Copyright Roy19 alty Judges, in accordance with section 803, to adjust

20 the royalty rates applicable to such works, or until

21 superseded by a new negotiated license agreement, as

22 provided in section 116(b).

23 ‘‘(6) SECTION 118 PROCEEDINGS.—A petition de24 scribed in subsection (a) to initiate proceedings under

25 section 801(b)(1) concerning the determination of rea-
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1 sonable terms and rates of royalty payments as pro2 vided in section 118 may be filed in the year 2006

3 and in each subsequent fifth calendar year.

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

5 described in subsection (a) to initiate proceedings

6 under section 801(b)(1) concerning the adjustment of

7 reasonable royalty rates under section 1004 may be

8 filed as provided in section 1004(a)(3).

9 ‘‘(8) PROCEEDINGS CONCERNING DISTRIBUTION

10 OF ROYALTY FEES.—With respect to proceedings

11 under section 801(b)(3) concerning the distribution of

12 royalty fees in certain circumstances under section

13 111, 119, or 1007, the Copyright Royalty Judges

14 shall, upon a determination that a controversy exists

15 concerning such distribution, cause to be published in

16 the Federal Register notice of commencement of pro17 ceedings under this chapter.

18 ‘‘§ 805. General rule for voluntarily negotiated agree19 ments

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

21 ‘‘(1) are agreed to by participants to a pro22 ceeding under section 803(b)(3),

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

24 Judges as part of a determination under this chapter,

25 and
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1 ‘‘(3) are in effect for a period shorter than would

2 otherwise apply under a determination pursuant to

3 this chapter,

4 shall remain in effect for such period of time as would other5 wise apply under such determination, except that the Copy6 right Royalty Judges shall adjust the rates pursuant to the

7 voluntary negotiations to reflect national monetary infla8 tion during the additional period the rates remain in ef9 fect.’’.

10 (b) CONFORMING AMENDMENT.—The table of chapters

11 for title 17, United States Code, is amended by striking the

12 item relating to chapter 8 and inserting the following:

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

13 SEC. 4. DEFINITION.

14 Section 101 is amended by inserting after the defini15 tion of ‘‘copies’’ the following:

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

17 Royalty Judge appointed under section 802 of this

18 title, and includes any individual serving as an in19 terim Copyright Royalty Judge under such section.’’.

20 SEC. 5. TECHNICAL AMENDMENTS.

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

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

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

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

25 (2) in paragraph (4)—
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1 (A) in subparagraph (A), by striking ‘‘Li2 brarian of Congress’’ each place it appears and

3 inserting ‘‘Copyright Royalty Judges’’;

4 (B) in subparagraph (B)—

5 (i) in the first sentence, by striking

6 ‘‘Librarian of Congress shall, upon the rec7 ommendation of the Register of Copy8 rights,’’ and inserting ‘‘Copyright Royalty

9 Judges shall’’;

10 (ii) in the second sentence, by striking

11 ‘‘Librarian determines’’ and inserting

12 ‘‘Copyright Royalty Judges determine’’; and

13 (iii) in the third sentence—

14 (I) by striking ‘‘Librarian’’ each

15 place it appears and inserting ‘‘Copy16 right Royalty Judges’’; and

17 (II) by striking ‘‘convene a copy18 right arbitration royalty panel’’ and

19 inserting ‘‘conduct a proceeding’’; and

20 (C) in subparagraph (C), by striking ‘‘Li21 brarian of Congress’’ and inserting ‘‘Copyright

22 Royalty Judges’’.

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

24 amended—

25 (1) in paragraph (3)—
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1 (A) by amending the first sentence to read

2 as follows: ‘‘Proceedings under chapter 8 shall

3 determine reasonable rates and terms of royalty

4 payments for the activities specified by para5 graph (1) during the 5-year periods beginning

6 on January 1 of the second year following the

7 year in which the proceedings are to be com8 menced, or such other periods as the parties may

9 agree.’’; and

10 (B) by striking the second sentence;

11 (C) in the third sentence, by striking ‘‘Li12 brarian of Congress’’ and inserting ‘‘Copyright

13 Royalty Judges’’; and

14 (D) in the fourth sentence, by striking ‘‘ne15 gotiation’’;

16 (2) in paragraph (4)—

17 (A) by amending the first sentence to read

18 as follows: ‘‘The schedule of reasonable rates and

19 terms determined by the Copyright Royalty

20 Judges shall, subject to paragraph (5), be bind21 ing on all copyright owners of sound recordings

22 and transmitting organizations entitled to a

23 statutory license under this subsection during the

24 5-year period specified in paragraph (3), or such

25 other period as the parties may agree.’’;
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1 (B) by striking ‘‘copyright arbitration roy2 alty panel’’ each subsequent place it appears and

3 inserting ‘‘Copyright Royalty Judges’’;

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

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

6 (D) in the fifth sentence, by striking ‘‘nego7 tiated as provided’’ and inserting ‘‘described’’;

8 and

9 (E) in the last sentence, by striking ‘‘Li10 brarian of Congress’’ and inserting ‘‘Copyright

11 Royalty Judges’’;

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

13 the Librarian of Congress’’ and inserting ‘‘, decision

14 by the Librarian of Congress, or determination by the

15 Copyright Royalty Judges’’;

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

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

18 and (8), respectively; and

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

20 striking ‘‘Librarian of Congress’’ and inserting

21 ‘‘Copyright Royalty Judges’’.

22 (c) SCOPE OF EXCLUSIVE RIGHTS IN SOUND RECORD23 INGS.—Section 114(f) is amended—

24 (1) in paragraph (1)—

25 (A) in subparagraph (A)—
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1 (i) by amending the first sentence to

2 read as follows: ‘‘Proceedings under chapter

3 8 shall determine reasonable rates and

4 terms of royalty payments for subscription

5 transmissions by preexisting subscription

6 services and transmissions by preexisting

7 satellite digital audio radio services speci8 fied by subsection (d)(2) during 5-year peri9 ods beginning on January 1 of the second

10 year following the year in which the pro11 ceedings are to be commenced, except where

12 different transitional periods are provided

13 in section 804(b), or such periods as the

14 parties may agree.’’;

15 (ii) in the third sentence, by striking

16 ‘‘Librarian of Congress’’ and inserting

17 ‘‘Copyright Royalty Judges’’; and

18 (iii) in the fourth sentence, by striking

19 ‘‘negotiation’’;

20 (B) in subparagraph (B)—

21 (i) by amending the first sentence to

22 read as follows: ‘‘The schedule of reasonable

23 rates and terms determined by the Copy24 right Royalty Judges shall, subject to para25 graph (3), be binding on all copyright own-
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1 ers of sound recordings and entities per2 forming sound recordings affected by this

3 paragraph during the 5-year period speci4 fied in subparagraph (A), a transitional pe5 riod provided in section 804(b), or such

6 other period as the parties may agree.’’;

7 (ii) in the second sentence, by striking

8 ‘‘copyright arbitration royalty panel’’ and

9 inserting ‘‘Copyright Royalty Judges’’; and

10 (iii) in the second sentence, by striking

11 ‘‘negotiated as provided’’ and inserting ‘‘de12 scribed’’; and

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

14 as follows:

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

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

17 filed by any copyright owners of sound recordings,

18 any preexisting subscription services, or any pre19 existing satellite digital audio radio services indi20 cating that a new type of subscription digital audio

21 transmission service on which sound recordings are

22 performed is or is about to become operational, for the

23 purpose of determining reasonable terms and rates of

24 royalty payments with respect to such new type of

25 transmission service for the period beginning with the
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1 inception of such new type of service and ending on

2 the date on which the royalty rates and terms for sub3 scription digital audio transmission services most re4 cently determined under subparagraph (A) or (B)

5 and chapter 8 expire, or such other period as the par6 ties may agree.’’;

7 (2) in paragraph (2)—

8 (A) in subparagraph (A)—

9 (i) by amending the first paragraph to

10 read as follows: ‘‘Proceedings under chapter

11 8 shall determine reasonable rates and

12 terms of royalty payments for subscription

13 transmissions by eligible nonsubscription

14 transmission services and transmissions by

15 new subscription services specified by sub16 section (d)(2) during 5-year periods begin17 ning on January 1 of the second year fol18 lowing the year in which the proceedings

19 are to be commenced, except where different

20 transitional periods are provided in section

21 804(b), or such periods as the parties may

22 agree.’’;

23 (ii) in the third sentence, by striking

24 ‘‘Librarian of Congress’’ and inserting

25 ‘‘Copyright Royalty Judges’’; and
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1 (iii) in the fourth sentence, by striking

2 ‘‘negotiation’’;

3 (B) in subparagraph (B)—

4 (i) by amending the first sentence to

5 read as follows: ‘‘The schedule of reasonable

6 rates and terms determined by the Copy7 right Royalty Judges shall, subject to para8 graph (3), be binding on all copyright own9 ers of sound recordings and entities per10 forming sound recordings affected by this

11 paragraph during the 5-year period speci12 fied in subparagraph (A), a transitional pe13 riod provided in section 804(b), or such

14 other period as the parties may agree.’’;

15 (ii) by striking ‘‘copyright arbitration

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

18 Judges’’; and

19 (iii) in the last sentence by striking

20 ‘‘negotiated as provided’’ and inserting ‘‘de21 scribed in’’; and

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

23 as follows:

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

25 and (B) shall also be initiated pursuant to a petition
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1 filed by any copyright owners of sound recordings or

2 any eligible nonsubscription service or new subscrip3 tion service indicating that a new type of eligible

4 nonsubscription service or new subscription service on

5 which sound recordings are performed is or is about

6 to become operational, for the purpose of determining

7 reasonable terms and rates of royalty payments with

8 respect to such new type of service for the period be9 ginning with the inception of such new type of service

10 and ending on the date on which the royalty rates

11 and terms for preexisting subscription digital audio

12 transmission services or preexisting satellite digital

13 radio audio services, as the case may be, most re14 cently determined under subparagraph (A) or (B)

15 and chapter 8 expire, or such other period as the par16 ties may agree.’’;

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

18 the Librarian of Congress’’ and inserting ‘‘, decision

19 by the Librarian of Congress, or determination by the

20 Copyright Royalty Judges’’; and

21 (4) in paragraph (4)—

22 (A) by striking ‘‘Librarian of Congress’’

23 each place it appears and inserting ‘‘Copyright

24 Royalty Judges’’; and
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1 (B) by adding after the first sentence ‘‘The

2 notice and recordkeeping rules in effect on the

3 day before the effective date of the Copyright

4 Royalty and Distribution Reform Act of 2004

5 shall remain in effect unless and until new regu6 lations are promulgated by the Copyright Roy7 alty Judges. If new regulations are promulgated

8 under this subparagraph, the Copyright Royalty

9 Judges shall take into account the substance and

10 effect of the rules in effect on the day before the

11 effective date of the Copyright Royalty and Dis12 tribution Reform Act of 2004 and shall, to the

13 extent practicable, avoid significant disruption

14 of the functions of any designated agent author15 ized to collect and distribute royalty fees.’’.

16 (d) PHONORECORDS OF NONDRAMATIC MUSICAL

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

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

19 and inserting ‘‘(E)’’;

20 (2) in subparagraph (B)—

21 (A) by striking ‘‘under this paragraph’’ and

22 inserting ‘‘under this section’’;

23 (B) by inserting ‘‘on a nonexclusive basis’’

24 after ‘‘common agents’’; and
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1 (C) by striking ‘‘subparagraphs (C) through

2 (F)’’ and inserting ‘‘this subparagraph and sub3 paragraphs (C) through (E)’’; and

4 (3) in subparagraph (C)—

5 (A) by amending the first sentence to read

6 as follows: ‘‘Proceedings under chapter 8 shall

7 determine reasonable rates and terms of royalty

8 payments for the activities specified by this sec9 tion during periods beginning with the effective

10 date of such rates and terms, but not earlier than

11 January 1 of the second year following the year

12 in which the petition requesting the proceeding is

13 filed, and ending on the effective date of successor

14 rates and terms, or such other period as the par15 ties may agree.’’;

16 (B) in the third sentence, by striking ‘‘Li17 brarian of Congress’’ and inserting ‘‘Copyright

18 Royalty Judges’’; and

19 (C) in the fourth sentence, by striking ‘‘ne20 gotiation’’;

21 (4) in subparagraph (D)—

22 (A) by amending the first sentence to read

23 as follows: ‘‘The schedule of reasonable rates and

24 terms determined by the Copyright Royalty

25 Judges shall, subject to subparagraph (E), be
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1 binding on all copyright owners of nondramatic

2 musical works and persons entitled to obtain a

3 compulsory license under subsection (a)(1) dur4 ing the period specified in subparagraph (C),

5 such other period as may be determined pursu6 ant to subparagraphs (B) and (C), or such other

7 period as the parties may agree.’’;

8 (B) in the third sentence, by striking ‘‘copy9 right arbitration royalty panel’’ and inserting

10 ‘‘Copyright Royalty Judges’’; and

11 (C) in the third sentence, by striking ‘‘nego12 tiated as provided in subparagraphs (B) and

13 (C)’’ and inserting ‘‘described’’;

14 (5) in subparagraph (E)—

15 (A) in clause (i)—

16 (i) in the first sentence, by striking

17 ‘‘Librarian of Congress’’ and inserting ‘‘Li18 brarian of Congress, Copyright Royalty

19 Judges, or a copyright arbitration royalty

20 panel to the extent those determinations

21 were accepted by the Librarian of Con22 gress’’; and

23 (ii) in the second sentence, by striking

24 ‘‘(C), (D) or (F) shall be given effect’’ and
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1 inserting ‘‘(C) or (D) shall be given effect as

2 to digital phonorecord deliveries’’; and

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

4 or (F)’’ each place it appears and inserting ‘‘(C)

5 or (D)’’; and

6 (6) by striking subparagraph (F) and redesig7 nating subparagraphs (G) through (L) as subpara8 graphs (F) through (K), respectively.

9 (e) COIN-OPERATED PHONORECORD PLAYERS.—Sec10 tion 116 is amended—

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

12 (2) to read as follows:

13 ‘‘(2) CHAPTER 8 PROCEEDING.—Parties not sub14 ject to such a negotiation may have the terms and

15 rates and the division of fees described in paragraph

16 (1) determined in a proceeding in accordance with

17 the provisions of chapter 8.’’; and

18 (2) in subsection (c)—

19 (A) in the subsection heading, by striking

20 ‘‘COPYRIGHT ARBITRATION ROYALTY PANEL DE21 TERMINATIONS’’ and inserting ‘‘DETERMINA22 TIONS BY COPYRIGHT ROYALTY JUDGES’’; and

23 (B) by striking ‘‘a copyright arbitration

24 royalty panel’’ and inserting ‘‘the Copyright

25 Royalty Judges’’.
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1 (f) USE OF CERTAIN WORKS IN CONNECTION WITH

2 NONCOMMERCIAL BROADCASTING.—Section 118 is

3 amended—

4 (1) in subsection (b)—

5 (A) in paragraph (1)—

6 (i) in the first sentence, by striking

7 ‘‘Librarian of Congress’’ and inserting

8 ‘‘Copyright Royalty Judges’’; and

9 (ii) by striking the second and third

10 sentences;

11 (B) in paragraph (2), by striking ‘‘Librar12 ian of Congress:’’ and all that follows through the

13 end of the sentence and inserting ‘‘Librarian of

14 Congress, a copyright arbitration royalty panel,

15 or the Copyright Royalty Judges, to the extent

16 that they were accepted by the Librarian of Con17 gress, if copies of such agreements are filed with

18 the Copyright Royalty Judges within 30 days of

19 execution in accordance with regulations that the

20 Copyright Royalty Judges shall issue.’’; and

21 (C) in paragraph (3)—

22 (i) in the second sentence—

23 (I) by striking ‘‘copyright arbitra24 tion royalty panel’’ and inserting

25 ‘‘Copyright Royalty Judges’’; and
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1 (II) by striking ‘‘paragraph (2).’’

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

3 (ii) in the last sentence, by striking

4 ‘‘‘Librarian of Congress’’ and inserting

5 ‘‘Copyright Royalty Judges’’; and

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

7 follows through the end of the first sentence

8 and inserting the following:

9 ‘‘(3) Voluntary negotiation proceedings initiated

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

11 the purpose of determining a schedule of terms and

12 rates of royalty payments by public broadcasting en13 tities to copyright owners in works specified by this

14 subsection and the proportionate division of fees paid

15 among various copyright owners shall cover the 5-

16 year period beginning on January 1 of the second

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

18 The parties to each negotiation proceeding shall bear

19 their own costs.

20 ‘‘(4) In the absence of license agreements nego21 tiated under paragraph (2) or (3), the Copyright

22 Royalty Judges shall, pursuant to chapter 8, conduct

23 a proceeding to determine and publish in the Federal

24 Register a schedule of rates and terms which, subject

25 to paragraph (2), shall be binding on all owners of
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1 copyright in works specified by this subsection and

2 public broadcasting entities, regardless of whether

3 such copyright owners have submitted proposals to the

4 Copyright Royalty Judges.’’;

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

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

7 (f), respectively;

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

9 matter preceding paragraph (1)—

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

11 ‘‘(b)(2) or (3)’’;

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

13 ‘‘(b)(4)’’; and

14 (C) by striking ‘‘a copyright arbitration

15 royalty panel under subsection (b)(3)’’ and in16 serting ‘‘the Copyright Royalty Judges under

17 subsection (b)(3), to the extent that they were ac18 cepted by the Librarian of Congress’’;

19 (4) in subsection (d), as so redesignated—

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

21 and inserting ‘‘with the Copyright Royalty

22 Judges’’; and

23 (B) by striking ‘‘Register of Copyrights

24 shall prescribe’’ and inserting ‘‘Copyright Roy-
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1 alty Judges shall prescribe as provided in section

2 803(b)(6)’’; and

3 (5) in subsection (f), as so redesignated, by strik4 ing ‘‘(d)’’ and inserting ‘‘(c)’’.

5 (g) SECONDARY TRANSMISSIONS BY SATELLITE CAR6 RIERS.—Section 119(b) is amended—

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

8 Congress’’ and inserting ‘‘Copyright Royalty Judges’’;

9 and

10 (2) in paragraph (4)—

11 (A) in subparagraph (A), by striking ‘‘Li12 brarian of Congress’’ each place it appears and

13 inserting ‘‘Copyright Royalty Judges’’; and

14 (B) by amending subparagraphs (B) and

15 (C) to read as follows:

16 ‘‘(B) DETERMINATION OF CONTROVERSY;

17 DISTRIBUTIONS.—After the first day of August of

18 each year, the Copyright Royalty Judges shall

19 determine whether there exists a controversy con20 cerning the distribution of royalty fees. If the

21 Copyright Royalty Judges determine that no

22 such controversy exists, the Librarian of Con23 gress shall, after deducting reasonable adminis24 trative costs under this paragraph, distribute

25 such fees to the copyright owners entitled to re-
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1 ceive them, or to their designated agents. If the

2 Copyright Royalty Judges find the existence of a

3 controversy, the Copyright Royalty Judges shall,

4 pursuant to chapter 8 of this title, conduct a

5 proceeding to determine the distribution of roy6 alty fees.

7 ‘‘(C) WITHHOLDING OF FEES DURING CON8 TROVERSY.—During the pendency of any pro9 ceeding under this subsection, the Copyright

10 Royalty Judges shall withhold from distribution

11 an amount sufficient to satisfy all claims with

12 respect to which a controversy exists, but shall

13 have the discretion to proceed to distribute any

14 amounts that are not in controversy.’’.

15 (h) DIGITAL AUDIO RECORDING DEVICES.—

16 (1) ROYALTY PAYMENTS.—Section 1004(a)(3) is

17 amended by striking ‘‘Librarian of Congress’’ each

18 place it appears and inserting ‘‘Copyright Royalty

19 Judges’’.

20 (2) ENTITLEMENT TO ROYALTY PAYMENTS.—Sec21 tion 1006(c) is amended by striking ‘‘Librarian of

22 Congress shall convene a copyright arbitration roy23 alty panel which’’ and inserting ‘‘Copyright Royalty

24 Judges’’.
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1 (3) PROCEDURES FOR DISTRIBUTING ROYALTY

2 PAYMENTS.—Section 1007 is amended—

3 (A) in subsection (a), by amending para4 graph (1) to read as follows:

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

6 months of each calendar year, every interested copy7 right party seeking to receive royalty payments to

8 which such party is entitled under section 1006 shall

9 file with the Copyright Royalty Judges a claim for

10 payments collected during the preceding year in such

11 form and manner as the Copyright Royalty Judges

12 shall prescribe by regulation.’’; and

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

14 read as follows:

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

16 A DISPUTE.—After the period established for the filing of

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

18 Royalty Judges shall determine whether there exists a con19 troversy concerning the distribution of royalty payments

20 under section 1006(c). If the Copyright Royalty Judges de21 termine that no such controversy exists, the Librarian of

22 Congress shall, within 30 days after such determination,

23 authorize the distribution of the royalty payments as set

24 forth in the agreements regarding the distribution of royalty

25 payments entered into pursuant to subsection (a). The Li-
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1 brarian of Congress shall, before such royalty payments are

2 distributed, deduct the reasonable administrative costs in3 curred by the Librarian under this section.

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

5 Royalty Judges find the existence of a controversy, the

6 Copyright Royalty Judges shall, pursuant to chapter 8 of

7 this title, conduct a proceeding to determine the distribution

8 of royalty payments. During the pendency of such a pro9 ceeding, the Copyright Royalty Judges shall withhold from

10 distribution an amount sufficient to satisfy all claims with

11 respect to which a controversy exists, but shall, to the extent

12 feasible, authorize the distribution of any amounts that are

13 not in controversy. The Librarian of Congress shall, before

14 such royalty payments are distributed, deduct the reason15 able administrative costs incurred by the Librarian under

16 this section.’’.

17 (4) DETERMINATION OF CERTAIN DISPUTES.—

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

19 ‘‘§ 1010. Determination of certain disputes

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

21 first distribution in the United States of a digital audio

22 recording device or a digital audio interface device, any

23 party manufacturing, importing, or distributing such de24 vice, and any interested copyright party may mutually

25 agree to petition the Copyright Royalty Judges to determine
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1 whether such device is subject to section 1002, or the basis

2 on which royalty payments for such device are to be made

3 under section 1003.

4 ‘‘(b) INITIATION OF PROCEEDINGS.—The parties under

5 subsection (a) shall file the petition with the Copyright Roy6 alty Judges requesting the commencement of a proceeding.

7 Within 2 weeks after receiving such a petition, the Chief

8 Copyright Royalty Judge shall cause notice to be published

9 in the Federal Register of the initiation of the proceeding.

10 ‘‘(c) STAY OF JUDICIAL PROCEEDINGS.—Any civil ac11 tion brought under section 1009 against a party to a pro12 ceeding under this section shall, on application of one of

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

14 the proceeding.

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

16 shall conduct a proceeding with respect to the matter con17 cerned, in accordance with such procedures as the Copyright

18 Royalty Judges may adopt. The Copyright Royalty Judges

19 shall act on the basis of a fully documented written record.

20 Any party to the proceeding may submit relevant informa21 tion and proposals to the Copyright Royalty Judges. The

22 parties to the proceeding shall each bear their respective

23 costs of participation.

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

25 Copyright Royalty Judges under subsection (d) may be ap-
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1 pealed, by a party to the proceeding, in accordance with

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

3 this subsection shall not stay the determination of the Copy4 right Royalty Judges. If the court modifies the determina5 tion of the Copyright Royalty Judges, the court shall have

6 jurisdiction to enter its own decision in accordance with

7 its final judgment. The court may further vacate the deter8 mination of the Copyright Royalty Judges and remand the

9 case for proceedings as provided in this section.’’.

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

11 table of sections for chapter 10 is amended to read as

12 follows:

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

13 SEC. 6. EFFECTIVE DATE AND TRANSITION PROVISIONS.

14 (a) EFFECTIVE DATE.—This Act and the amendments

15 made by this Act shall take effect 6 months after the date

16 of enactment of this Act, except that the Librarian of Con17 gress shall appoint 1 or more interim Copyright Royalty

18 Judges under section 802(d) of title 17, United States Code,

19 as amended by this Act, within 90 days after such date

20 of enactment to carry out the functions of the Copyright

21 Royalty Judges under title 17, United States Code, to the

22 extent that Copyright Royalty Judges provided for in sec23 tion 801(a) of title 17, United States Code, as amended by

24 this Act, have not been appointed before the end of that 90-

25 day period.
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1 (b) TRANSITION PROVISIONS.—

2 (1) IN GENERAL.—Subject to paragraphs (2) and

3 (3), the amendments made by this Act shall not affect

4 any proceedings commenced, petitions filed, or vol5 untary agreements entered into before the date of en6 actment of this Act under the provisions of title 17,

7 United States Code, as amended by this Act, and

8 pending on such date of enactment. Such proceedings

9 shall continue, determinations made in such pro10 ceedings, and appeals taken therefrom, as if this Act

11 had not been enacted, and shall continue in effect

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

13 amended by this Act. Such petitions filed and vol14 untary agreements entered into shall remain in effect

15 as if this Act had not been enacted. For purposes of

16 this paragraph, the Librarian of Congress may deter17 mine whether a proceeding has commenced. The Li18 brarian of Congress may terminate any proceeding

19 commenced before the date of enactment of this Act

20 pursuant to chapter 8 of title 17, United States Code,

21 and any proceeding so terminated shall become null

22 and void. In such cases, the Copyright Royalty

23 Judges may initiate a new proceeding in accordance

24 with regulations adopted pursuant to section

25 803(b)(6) of title 17, United States Code.
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1 (2) CERTAIN ROYALTY RATES PROCEEDINGS.—

2 Notwithstanding any other provision of law, pro3 ceedings to determine royalty rates pursuant to sec4 tion 119(c) of title 17, United States Code, shall be

5 conducted pursuant to the provisions of title 17,

6 United States Code, and the rules and practices in ef7 fect under that chapter on the day before any provi8 sion of this Act takes effect.

9 (3) PENDING PROCEEDINGS.—Notwithstanding

10 paragraph (1), any proceedings to establish or adjust

11 rates and terms for the statutory licenses under sec12 tion 114(f)(2) or 112(e) of title 17, United States

13 Code, for a statutory period commencing on or after

14 January 1, 2005, shall be terminated upon the date

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

16 The rates and terms in effect under section 114(f)(2)

17 or 112(e) of title 17, United States Code, on December

18 31, 2004, for new subscription services, eligible non19 subscription services, and services exempt under sec20 tion 114(d)(1)(C)(iv) of such title, and the rates and

21 terms published in the Federal Register under the au22 thority of the Small Webcaster Settlement Act of 2002

23 (17 U.S.C. 114 note; Public Law 107–321) (including

24 the amendments made by that Act) for the years 2003

25 through 2004, as well as any notice and record-
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1 keeping provisions adopted pursuant thereto, shall re2 main in effect until the later of the first applicable

3 effective date for successor terms and rates specified in

4 section 804(b) (2) or (3)(A) of title 17, United States

5 Code, or such later date as the parties may agree or

6 the Copyright Royalty Judges may establish. For the

7 period commencing January 1, 2005, an eligible

8 small webcaster or a noncommercial webcaster, as de9 fined in the regulations published by the Register of

10 Copyrights pursuant to the Small Webcaster Settle11 ment Act of 2002 (17 U.S.C. 114 note; Public Law

12 107–321) (including the amendments made by that

13 Act), may elect to be subject to the rates and terms

14 published in those regulations by complying with the

15 procedures governing the election process set forth in

16 those regulations not later than the first date on

17 which the webcaster would be obligated to make a roy18 alty payment for such period. Until successor terms

19 and rates have been established for the period com20 mencing January 1, 2006, licensees shall continue to

21 make royalty payments at the rates and on the terms

22 previously in effect, subject to retroactive adjustment

23 when successor rates and terms for such services are

24 established.
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1 (4) INTERIM PROCEEDINGS.—Notwithstanding

2 subsection (a), as soon as practicable after the date of

3 enactment of this Act, the Copyright Royalty Judges

4 or interim Copyright Royalty Judges shall publish

5 the notice described in section 803(b)(1)(A) of title 17,

6 United States Code, as amended by this Act, to ini7 tiate a proceeding to establish or adjust rates and

8 terms for the statutory licenses under section 114(f)(2)

9 or 112(e) of title 17, United States Code, for new sub10 scription services and eligible nonsubscription services

11 for the period commencing January 1, 2006. The

12 Copyright Royalty Judges or Interim Copyright Roy13 alty Judges are authorized to cause that proceeding to

14 take place as provided in subsection (b) of section 803

15 of that title within the time periods set forth in that

16 subsection. Notwithstanding section 803(c)(1) of that

17 title, the Copyright Royalty Judges shall not be re18 quired to issue their determination in that proceeding

19 before the expiration of the statutory rates and terms

20 in effect on December 31, 2004.

21 (c) EXISTING APPROPRIATIONS.—Any funds made

22 available in an appropriations Act to carry out chapter 8
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1 of title 17, United States Code, shall be available to the ex2 tent necessary to carry out this section.

Attest:

Secretary.
108TH CONGRESS

2D SESSION H. R. 1417

AMENDMENT