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[108th Congress Public Law 419]
[From the U.S. Government Printing Office]

<DOC>
[DOCID: f:publ419.108]

[[Page 118 STAT. 2341]]

Public Law 108-419
108th Congress

                                 An Act

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

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

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

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

SEC. 2. REFERENCE.

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

SEC. 3. COPYRIGHT ROYALTY JUDGE AND STAFF.

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

          ``CHAPTER 8--PROCEEDINGS BY COPYRIGHT ROYALTY JUDGES

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

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

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

[[Page 118 STAT. 2342]]

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

[[Page 118 STAT. 2343]]

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

[[Page 118 STAT. 2344]]

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

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

[[Page 118 STAT. 2345]]

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

``Sec. 802. Copyright Royalty Judgeships; staff

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

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

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

[[Page 118 STAT. 2346]]

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

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

[[Page 118 STAT. 2347]]

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

[[Page 118 STAT. 2348]]

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

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

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

``Sec. 803. Proceedings of Copyright Royalty Judges

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

[[Page 118 STAT. 2349]]

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

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

[[Page 118 STAT. 2350]]

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

[[Page 118 STAT. 2351]]

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

[[Page 118 STAT. 2352]]

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

[[Page 118 STAT. 2353]]

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

[[Page 118 STAT. 2354]]

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

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

[[Page 118 STAT. 2355]]

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

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

[[Page 118 STAT. 2356]]

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

[[Page 118 STAT. 2357]]

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

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

``Sec. 804. Institution of proceedings

    ``(a) <<NOTE: Notices. Federal Register, publication.>> Filing of 
Petition.--With respect to proceedings referred to in paragraphs (1) and 
(2) of section 801(b) concerning the determination or adjustment of 
royalty rates as provided in sections 111, 112, 114, 115, 116, 118, 119, 
and 1004, during the calendar

[[Page 118 STAT. 2358]]

years specified in the schedule set forth in subsection (b), any owner 
or user of a copyrighted work whose royalty rates are specified by this 
title, or are established under this chapter before or after the 
enactment of the Copyright Royalty and Distribution Reform Act of 2004, 
may file a petition with the Copyright Royalty Judges declaring that the 
petitioner requests a determination or adjustment of the rate. The 
Copyright Royalty Judges shall make a determination as to whether the 
petitioner has such a significant interest in the royalty rate in which 
a determination or adjustment is requested. If the Copyright Royalty 
Judges determine that the petitioner has such a significant interest, 
the Copyright Royalty Judges shall cause notice of this determination, 
with the reasons for such determination, to be published in the Federal 
Register, together with the notice of commencement of proceedings under 
this chapter. With respect to proceedings under paragraph (1) of section 
801(b) concerning the determination or adjustment of royalty rates as 
provided in sections 112 and 114, during the calendar years specified in 
the schedule set forth in subsection (b), the Copyright Royalty Judges 
shall cause notice of commencement of proceedings under this chapter to 
be published in the Federal Register as provided in section 
803(b)(1)(A).

    ``(b) Timing of Proceedings.--
            ``(1) Section 111 proceedings.--(A) A petition described in 
        subsection (a) to initiate proceedings under section 801(b)(2) 
        concerning the adjustment of royalty rates under section 111 to 
        which subparagraph (A) or (D) of section 801(b)(2) applies may 
        be filed during the year 2005 and in each subsequent fifth 
        calendar year.
            ``(B) In order to initiate proceedings under section 
        801(b)(2) concerning the adjustment of royalty rates under 
        section 111 to which subparagraph (B) or (C) of section 
        801(b)(2) applies, within 12 months after an event described in 
        either of those subsections, any owner or user of a copyrighted 
        work whose royalty rates are specified by section 111, or by a 
        rate established under this chapter before or after the 
        enactment of the Copyright Royalty and Distribution Reform Act 
        of 2004, may file a petition with the Copyright Royalty Judges 
        declaring that the petitioner requests an adjustment of the 
        rate. The Copyright Royalty Judges shall then proceed as set 
        forth in subsection (a) of this section. Any change in royalty 
        rates made under this chapter pursuant to this subparagraph may 
        be reconsidered in the year 2005, and each fifth calendar year 
        thereafter, in accordance with the provisions in section 
        801(b)(3) (B) or (C), as the case may be. A petition for 
        adjustment of rates established by section 111(d)(1)(B) as a 
        result of a change is the rules and regulations of the Federal 
        Communications Commission shall set forth the change on which 
        the petition is based.
            ``(C) <<NOTE: Effective date.>> Any adjustment of royalty 
        rates under section 111 shall take effect as of the first 
        accounting period commencing after the publication of the 
        determination of the Copyright Royalty Judges in the Federal 
        Register, or on such other date as is specified in that 
        determination.
            ``(2) <<NOTE: Effective date.>> Certain section 112 
        proceedings.--Proceedings under this chapter shall be commenced 
        in the year 2007 to determine reasonable terms and rates of 
        royalty payments for the activities described in section 
        112(e)(1) relating to the

[[Page 118 STAT. 2359]]

        limitation on exclusive rights specified by section 
        114(d)(1)(C)(iv), to become effective on January 1, 2009. Such 
        proceedings shall be repeated in each subsequent fifth calendar 
        year.
            ``(3) <<NOTE: Effective dates. Termination date.>> Section 
        114 and corresponding 112 proceedings.--
                    ``(A) For eligible nonsubscription services and new 
                subscription services.--Proceedings under this chapter 
                shall be commenced as soon as practicable after the 
                effective date of the Copyright Royalty and Distribution 
                Reform Act of 2004 to determine reasonable terms and 
                rates of royalty payments under sections 114 and 112 for 
                the activities of eligible nonsubscription transmission 
                services and new subscription services, to be effective 
                for the period beginning on January 1, 2006, and ending 
                on December 31, 2010. Such proceedings shall next be 
                commenced in January 2009 to determine reasonable terms 
                and rates of royalty payments, to become effective on 
                January 1, 2011. Thereafter, such proceedings shall be 
                repeated in each subsequent fifth calendar year.
                    ``(B) <<NOTE: Effective dates. Termination 
                dates.>> For preexisting subscription and satellite 
                digital audio radio services.--Proceedings under this 
                chapter shall be commenced in January 2006 to determine 
                reasonable terms and rates of royalty payments under 
                sections 114 and 112 for the activities of preexisting 
                subscription services, to be effective during the period 
                beginning on January 1, 2008, and ending on December 31, 
                2012, and preexisting satellite digital audio radio 
                services, to be effective during the period beginning on 
                January 1, 2007, and ending on December 31, 2012. Such 
                proceedings shall next be commenced in 2011 to determine 
                reasonable terms and rates of royalty payments, to 
                become effective on January 1, 2013. Thereafter, such 
                proceedings shall be repeated in each subsequent fifth 
                calendar year.
                    ``(C)(i) Notwithstanding any other provision of this 
                chapter, this subparagraph shall govern proceedings 
                commenced pursuant to section 114(f)(1)(C) and 
                114(f)(2)(C) concerning new types of services.
                    ``(ii) <<NOTE: Deadline. Notice.>> Not later than 30 
                days after a petition to determine rates and terms for a 
                new type of service that is filed by any copyright owner 
                of sound recordings, or such new type of service, 
                indicating that such new type of service is or is about 
                to become operational, the Copyright Royalty Judges 
                shall issue a notice for a proceeding to determine rates 
                and terms for such service.
                    ``(iii) The proceeding shall follow the schedule set 
                forth in such subsections (b), (c), and (d) of section 
                803, except that--
                          ``(I) <<NOTE: Deadline.>> the determination 
                      shall be issued by not later than 24 months after 
                      the publication of the notice under clause (ii); 
                      and
                          ``(II) <<NOTE: Effective date.>> the decision 
                      shall take effect as provided in subsections 
                      (c)(2) and (d)(2) of section 803 and section 
                      114(f)(4)(B)(ii) and (C).
                    ``(iv) The rates and terms shall remain in effect 
                for the period set forth in section 114(f)(1)(C) or 
                114(f)(2)(C), as the case may be.

[[Page 118 STAT. 2360]]

            ``(4) Section 115 proceedings.--A petition described in 
        subsection (a) to initiate proceedings under section 801(b)(1) 
        concerning the adjustment or determination of royalty rates as 
        provided in section 115 may be filed in the year 2006 and in 
        each subsequent fifth calendar year, or at such other times as 
        the parties have agreed under section 115(c)(3) (B) and (C).
            ``(5) <<NOTE: Deadline.>> Section 116 proceedings.--(A) A 
        petition described in subsection (a) to initiate proceedings 
        under section 801(b) concerning the determination of royalty 
        rates and terms as provided in section 116 may be filed at any 
        time within 1 year after negotiated licenses authorized by 
        section 116 are terminated or expire and are not replaced by 
        subsequent agreements.
            ``(B) <<NOTE: Deadline.>> If a negotiated license authorized 
        by section 116 is terminated or expires and is not replaced by 
        another such license agreement which provides permission to use 
        a quantity of musical works not substantially smaller than the 
        quantity of such works performed on coin-operated phonorecord 
        players during the 1-year period ending March 1, 1989, the 
        Copyright Royalty Judges shall, upon petition filed under 
        paragraph (1) within 1 year after such termination or 
        expiration, commence a proceeding to promptly establish an 
        interim royalty rate or rates for the public performance by 
        means of a coin-operated phonorecord player of nondramatic 
        musical works embodied in phonorecords which had been subject to 
        the terminated or expired negotiated license agreement. Such 
        rate or rates shall be the same as the last such rate or rates 
        and shall remain in force until the conclusion of proceedings by 
        the Copyright Royalty Judges, in accordance with section 803, to 
        adjust the royalty rates applicable to such works, or until 
        superseded by a new negotiated license agreement, as provided in 
        section 116(b).
            ``(6) Section 118 proceedings.--A petition described in 
        subsection (a) to initiate proceedings under section 801(b)(1) 
        concerning the determination of reasonable terms and rates of 
        royalty payments as provided in section 118 may be filed in the 
        year 2006 and in each subsequent fifth calendar year.
            ``(7) Section 1004 proceedings.--A petition described in 
        subsection (a) to initiate proceedings under section 801(b)(1) 
        concerning the adjustment of reasonable royalty rates under 
        section 1004 may be filed as provided in section 1004(a)(3).
            ``(8) <<NOTE: Federal 
        Register, publication. Notice.>> Proceedings concerning 
        distribution of royalty fees.--With respect to proceedings under 
        section 801(b)(3) concerning the distribution of royalty fees in 
        certain circumstances under section 111, 119, or 1007, the 
        Copyright Royalty Judges shall, upon a determination that a 
        controversy exists concerning such distribution, cause to be 
        published in the Federal Register notice of commencement of 
        proceedings under this chapter.

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

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

[[Page 118 STAT. 2361]]

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

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

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

SEC. 4. DEFINITION.

    Section 101 is amended by inserting after the definition of 
``copies'' the following:
            ``A `Copyright Royalty Judge' is a Copyright Royalty Judge 
        appointed under section 802 of this title, and includes any 
        individual serving as an interim Copyright Royalty Judge under 
        such section.''.

SEC. 5. TECHNICAL AMENDMENTS.

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

    (b) Ephemeral Recordings.--Section 112(e) is amended--
            (1) in paragraph (3)--
                    (A) by amending the first sentence to read as 
                follows: ``Proceedings under chapter 8 shall determine 
                reasonable rates and terms of royalty payments for the 
                activities specified by paragraph (1) during the 5-year 
                period beginning on January 1 of the second year 
                following the year in which the proceedings are to be 
                commenced, or such other period as the parties may 
                agree.'';
                    (B) in the third sentence, by striking ``Librarian 
                of Congress'' and inserting ``Copyright Royalty 
                Judges''; and

[[Page 118 STAT. 2362]]

                    (C) in the fourth sentence, by striking 
                ``negotiation'';
            (2) in paragraph (4)--
                    (A) by amending the first sentence to read as 
                follows: ``The schedule of reasonable rates and terms 
                determined by the Copyright Royalty Judges shall, 
                subject to paragraph (5), be binding on all copyright 
                owners of sound recordings and transmitting 
                organizations entitled to a statutory license under this 
                subsection during the 5-year period specified in 
                paragraph (3), or such other period as the parties may 
                agree.'';
                    (B) by striking ``copyright arbitration royalty 
                panel'' each subsequent place it appears and inserting 
                ``Copyright Royalty Judges'';
                    (C) in the fourth sentence, by striking ``its 
                decision'' and inserting ``their decision'';
                    (D) in the fifth sentence, by striking ``negotiated 
                as provided'' and inserting ``described''; and
                    (E) in the last sentence, by striking ``Librarian of 
                Congress'' and inserting ``Copyright Royalty Judges'';
            (3) in paragraph (5), by striking ``determination by a 
        copyright arbitration royalty panel or decision by the Librarian 
        of Congress'' and inserting ``decision by the Librarian of 
        Congress or determination by the Copyright Royalty Judges'';
            (4) by striking paragraph (6) and redesignating paragraphs 
        (7), (8), and (9), as paragraphs (6), (7), and (8), 
        respectively; and
            (5) in paragraph (6)(A), as so redesignated, by striking 
        ``Librarian of Congress'' and inserting ``Copyright Royalty 
        Judges''.

    (c) Scope of Exclusive Rights in Sound Recordings.--Section 114(f) 
is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                          (i) by amending the first sentence to read as 
                      follows: ``Proceedings under chapter 8 shall 
                      determine reasonable rates and terms of royalty 
                      payments for subscription transmissions by 
                      preexisting subscription services and 
                      transmissions by preexisting satellite digital 
                      audio radio services specified by subsection 
                      (d)(2) during the 5-year period beginning on 
                      January 1 of the second year following the year in 
                      which the proceedings are to be commenced, except 
                      where a different transitional period is provided 
                      under section 6(b)(3) of the Copyright Royalty and 
                      Distribution Reform Act of 2004 or such other 
                      period.'';
                          (ii) in the third sentence, by striking 
                      ``Librarian of Congress'' and inserting 
                      ``Copyright Royalty Judges''; and
                          (iii) in the fourth sentence, by striking 
                      ``negotiation'';
                    (B) in subparagraph (B)--
                          (i) by amending the first sentence to read as 
                      follows: ``The schedule of reasonable rates and 
                      terms determined by the Copyright Royalty Judges 
                      shall, subject to paragraph (3), be binding on all 
                      copyright owners of sound recordings and entities 
                      performing sound recordings affected by this 
                      paragraph during

[[Page 118 STAT. 2363]]

                      the 5-year period specified in subparagraph (A), a 
                      transitional period provided under section 6(b)(3) 
                      of the Copyright Royalty and Distribution Reform 
                      Act of 2004, or such other period as the parties 
                      may agree.'';
                          (ii) in the second sentence, by striking 
                      ``copyright arbitration royalty panel'' and 
                      inserting ``Copyright Royalty Judges''; and
                          (iii) in the second sentence, by striking 
                      ``negotiated as provided'' and inserting 
                      ``described''; and
                    (C) by amending subparagraph (C) to read as follows:
            ``(C) The procedures under subparagraphs (A) and (B) also 
        shall be initiated pursuant to a petition filed by any copyright 
        owners of sound recordings, any preexisting subscription 
        services, or any preexisting satellite digital audio radio 
        services indicating that a new type of subscription digital 
        audio transmission service on which sound recordings are 
        performed is or is about to become operational, for the purpose 
        of determining reasonable terms and rates of royalty payments 
        with respect to such new type of transmission service for the 
        period beginning with the inception of such new type of service 
        and ending on the date on which the royalty rates and terms for 
        subscription digital audio transmission services most recently 
        determined under subparagraph (A) or (B) and chapter 8 expire, 
        or such other period as the parties may agree.'';
            (2) in paragraph (2)--
                    (A) in subparagraph (A)--
                          (i) by amending the first paragraph to read as 
                      follows: ``Proceedings under chapter 8 shall 
                      determine reasonable rates and terms of royalty 
                      payments for subscription transmissions by 
                      eligible nonsubscription transmission services and 
                      transmissions by new subscription services 
                      specified by subsection (d)(2) during the 5-year 
                      period beginning on January 1 of the second year 
                      following the year in which the proceedings are to 
                      be commenced, except where a different 
                      transitional period is provided under section 
                      6(b)(3) of the Copyright Royalty and Distribution 
                      Reform Act of 2004, or such other period as the 
                      parties may agree.'';
                          (ii) in the third sentence, by striking 
                      ``Librarian of Congress'' and inserting 
                      ``Copyright Royalty Judges''; and
                          (iii) in the fourth sentence, by striking 
                      ``negotiation'';
                    (B) in subparagraph (B)--
                          (i) by amending the first sentence to read as 
                      follows: ``The schedule of reasonable rates and 
                      terms determined by the Copyright Royalty Judges 
                      shall, subject to paragraph (3), be binding on all 
                      copyright owners of sound recordings and entities 
                      performing sound recordings affected by this 
                      paragraph during the 5-year period specified in 
                      subparagraph (A), a transitional period provided 
                      under section 6(b)(3) of the Copyright Royalty and 
                      Distribution Act of 2004, or such other period as 
                      the parties may agree.'';
                          (ii) by striking ``copyright arbitration 
                      royalty panel'' each subsequent place it appears 
                      and inserting ``Copyright Royalty Judges''; and

[[Page 118 STAT. 2364]]

                          (iii) in the last sentence by striking 
                      ``negotiated as provided'' and inserting 
                      ``described in''; and
                    (C) by amending subparagraph (C) to read as follows:
            ``(C) The procedures under subparagraphs (A) and (B) shall 
        also be initiated pursuant to a petition filed by any copyright 
        owners of sound recordings or any eligible nonsubscription 
        service or new subscription service indicating that a new type 
        of eligible nonsubscription service or new subscription service 
        on which sound recordings are performed is or is about to become 
        operational, for the purpose of determining reasonable terms and 
        rates of royalty payments with respect to such new type of 
        service for the period beginning with the inception of such new 
        type of service and ending on the date on which the royalty 
        rates and terms for preexisting subscription digital audio 
        transmission services or preexisting satellite digital radio 
        audio services, as the case may be, most recently determined 
        under subparagraph (A) or (B) and chapter 8 expire, or such 
        other period as the parties may agree.'';
            (3) in paragraph (3), by striking ``determination by a 
        copyright arbitration royalty panel or decision by the Librarian 
        of Congress'' and inserting ``decision by the Librarian of 
        Congress or determination by the Copyright Royalty Judges''; and
            (4) in paragraph (4)--
                    (A) by striking ``Librarian of Congress'' each place 
                it appears and inserting ``Copyright Royalty Judges''; 
                and
                    (B) by adding after the first sentence of 
                subparagraph (A) the following: ``The notice and 
                recordkeeping rules in effect on the day before the 
                effective date of the Copyright Royalty and Distribution 
                Reform Act of 2004 shall remain in effect unless and 
                until new regulations are promulgated by the Copyright 
                Royalty Judges. If new regulations are promulgated under 
                this subparagraph, the Copyright Royalty Judges shall 
                take into account the substance and effect of the rules 
                in effect on the day before the effective date of the 
                Copyright Royalty and Distribution Reform Act of 2004 
                and shall, to the extent practicable, avoid significant 
                disruption of the functions of any designated agent 
                authorized to collect and distribute royalty fees.''.

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

[[Page 118 STAT. 2365]]

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

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

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

[[Page 118 STAT. 2366]]

                          (i) in the first sentence, by striking 
                      ``Librarian of Congress'' and inserting 
                      ``Copyright Royalty Judges''; and
                          (ii) by striking the second and third 
                      sentences;
                    (B) <<NOTE: Deadline.>> in paragraph (2), by 
                striking ``Librarian of Congress:'' and all that follows 
                through the end of the sentence and inserting 
                ``Librarian of Congress or the Copyright Royalty Judges, 
                if copies of such agreements are filed with the 
                Copyright Royalty Judges within 30 days of execution in 
                accordance with regulations that the Copyright Royalty 
                Judges shall issue.''; and
                    (C) in paragraph (3)--
                          (i) in the second sentence--
                                    (I) by striking ``copyright 
                                arbitration royalty panel'' and 
                                inserting ``Copyright Royalty Judges''; 
                                and
                                    (II) by striking ``paragraph (2).'' 
                                and inserting ``paragraph (2) or (3).'';
                          (ii) in the last sentence, by striking 
                      ```Librarian of Congress'' and inserting 
                      ``Copyright Royalty Judges''; and
                          (iii) by striking ``(3) In'' and all that 
                      follows through the end of the first sentence and 
                      inserting the following:
            ``(3) Voluntary negotiation proceedings initiated pursuant 
        to a petition filed under section 804(a) for the purpose of 
        determining a schedule of terms and rates of royalty payments by 
        public broadcasting entities to copyright owners in works 
        specified by this subsection and the proportionate division of 
        fees paid among various copyright owners shall cover the 5-year 
        period beginning on January 1 of the second year following the 
        year in which the petition is filed. The parties to each 
        negotiation proceeding shall bear their own costs.
            ``(4) <<NOTE: Federal Register, publication.>> In the 
        absence of license agreements negotiated under paragraph (2) or 
        (3), the Copyright Royalty Judges shall, pursuant to chapter 8, 
        conduct a proceeding to determine and publish in the Federal 
        Register a schedule of rates and terms which, subject to 
        paragraph (2), shall be binding on all owners of copyright in 
        works specified by this subsection and public broadcasting 
        entities, regardless of whether such copyright owners have 
        submitted proposals to the Copyright Royalty Judges.'';
            (2) by striking subsection (c) and redesignating subsections 
        (d) through (g) as subsections (c) through (f), respectively;
            (3) in subsection (c), as so redesignated, in the matter 
        preceding paragraph (1)--
                    (A) by striking ``(b)(2)'' and inserting ``(b)(2) or 
                (3)'';
                    (B) by striking ``(b)(3)'' and inserting ``(b)(4)''; 
                and
                    (C) by striking ``a copyright arbitration royalty 
                panel under subsection (b)(3)'' and inserting ``the 
                Copyright Royalty Judges under subsection (b)(3), to the 
                extent that they were accepted by the Librarian of 
                Congress'';
            (4) in subsection (d), as so redesignated--
                    (A) by striking ``in the Copyright Office'' and 
                inserting ``with the Copyright Royalty Judges''; and
                    (B) by striking ``Register of Copyrights shall 
                prescribe'' and inserting ``Copyright Royalty Judges 
                shall prescribe as provided in section 803(b)(6)''; and

[[Page 118 STAT. 2367]]

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

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

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

[[Page 118 STAT. 2368]]

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

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

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

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

[[Page 118 STAT. 2369]]

``Sec. 1010. Determination of certain disputes

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

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

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

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

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

[[Page 118 STAT. 2370]]

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

[[Page 118 STAT. 2371]]

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

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

    Approved November 30, 2004.

LEGISLATIVE HISTORY--H.R. 1417:
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HOUSE REPORTS: No. 108-408 (Comm. on the Judiciary).
CONGRESSIONAL RECORD, Vol. 150 (2004):
            Mar. 3, considered and passed House.
            Oct. 6, considered and passed Senate, ameneded.
            Nov. 17, House concurred in Senate amendment.

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