H. R. 2281—41
makes the phonorecord under this subsection from a phono-
record lawfully made and acquired under the authority of the
copyright owner.
‘‘(3) Notwithstanding any provision of the antitrust laws, any
copyright owners of sound recordings and any transmitting
organizations entitled to a statutory license under this subsection
may negotiate and agree upon royalty rates and license terms
and conditions for making phonorecords of such sound recordings
under this section and the proportionate division of fees paid among
copyright owners, and may designate common agents to negotiate,
agree to, pay, or receive such royalty payments.
‘‘(4) No later than 30 days after the date of the enactment
of the Digital Millennium Copyright Act, the Librarian of Congress
shall cause notice to be published in the Federal Register of the
initiation of voluntary negotiation proceedings for the purpose of
determining reasonable terms and rates of royalty payments for
the activities specified by paragraph (2) of this subsection during
the period beginning on the date of the enactment of such Act
and ending on December 31, 2000, or such other date as the
parties may agree. Such rates shall include a minimum fee for
each type of service offered by transmitting organizations. Any
copyright owners of sound recordings or any transmitting organiza-
tions entitled to a statutory license under this subsection may
submit to the Librarian of Congress licenses covering such activities
with respect to such sound recordings. The parties to each negotia-
tion proceeding shall bear their own costs.
‘‘(5) In the absence of license agreements negotiated under
paragraph (3), during the 60-day period commencing 6 months
after publication of the notice specified in paragraph (4), and upon
the filing of a petition in accordance with section 803(a)(1), the
Librarian of Congress shall, pursuant to chapter 8, convene a copy-
right arbitration royalty panel to determine and publish in the
Federal Register a schedule of reasonable rates and terms which,
subject to paragraph (6), shall be binding on all copyright owners
of sound recordings and transmitting organizations entitled to a
statutory license under this subsection during the period beginning
on the date of the enactment of the Digital Millennium Copyright
Act and ending on December 31, 2000, or such other date as
the parties may agree. Such rates shall include a minimum fee
for each type of service offered by transmitting organizations. The
copyright arbitration royalty panel shall establish rates that most
clearly represent the fees that would have been negotiated in the
marketplace between a willing buyer and a willing seller. In deter-
mining such rates and terms, the copyright arbitration royalty
panel shall base its decision on economic, competitive, and program-
ming information presented by the parties, including—
‘‘(A) whether use of the service may substitute for or may
promote the sales of phonorecords or otherwise interferes with
or enhances the copyright owner’s traditional streams of reve-
nue; and
‘‘(B) the relative roles of the copyright owner and the
transmitting organization in the copyrighted work and the serv-
ice made available to the public with respect to relative creative
contribution, technological contribution, capital investment,
cost, and risk.
In establishing such rates and terms, the copyright arbitration
royalty panel may consider the rates and terms under voluntary
H. R. 2281—42
license agreements negotiated as provided in paragraphs (3) and
(4). The Librarian of Congress shall also establish requirements
by which copyright owners may receive reasonable notice of the
use of their sound recordings under this section, and under which
records of such use shall be kept and made available by transmitting
organizations entitled to obtain a statutory license under this sub-
section.
‘‘(6) License agreements voluntarily negotiated at any time
between 1 or more copyright owners of sound recordings and 1
or more transmitting organizations entitled to obtain a statutory
license under this subsection shall be given effect in lieu of any
determination by a copyright arbitration royalty panel or decision
by the Librarian of Congress.
‘‘(7) Publication of a notice of the initiation of voluntary negotia-
tion proceedings as specified in paragraph (4) shall be repeated,
in accordance with regulations that the Librarian of Congress shall
prescribe, in the first week of January 2000, and at 2-year intervals
thereafter, except to the extent that different years for the repeating
of such proceedings may be determined in accordance with para-
graph (4). The procedures specified in paragraph (5) shall be
repeated, in accordance with regulations that the Librarian of Con-
gress shall prescribe, upon filing of a petition in accordance with
section 803(a)(1), during a 60-day period commencing on July 1,
2000, and at 2-year intervals thereafter, except to the extent that
different years for the repeating of such proceedings may be deter-
mined in accordance with paragraph (4). The procedures specified
in paragraph (5) shall be concluded in accordance with section
802.
‘‘(8)(A) Any person who wishes to make a phonorecord of a
sound recording under a statutory license in accordance with this
subsection may do so without infringing the exclusive right of
the copyright owner of the sound recording under section 106(1)—
‘‘(i) by complying with such notice requirements as the
Librarian of Congress shall prescribe by regulation and by
paying royalty fees in accordance with this subsection; or
‘‘(ii) if such royalty fees have not been set, by agreeing
to pay such royalty fees as shall be determined in accordance
with this subsection.
‘‘(B) Any royalty payments in arrears shall be made on or
before the 20th day of the month next succeeding the month in
which the royalty fees are set.
‘‘(9) If a transmitting organization entitled to make a phono-
record under this subsection is prevented from making such phono-
record by reason of the application by the copyright owner of tech-
nical measures that prevent the reproduction of the sound recording,
the copyright owner shall make available to the transmitting
organization the necessary means for permitting the making of
such phonorecord as permitted under this subsection, if it is techno-
logically feasible and economically reasonable for the copyright
owner to do so. If the copyright owner fails to do so in a timely
manner in light of the transmitting organization’s reasonable busi-
ness requirements, the transmitting organization shall not be liable
for a violation of section 1201(a)(1) of this title for engaging in
such activities as are necessary to make such phonorecords as
permitted under this subsection.
‘‘(10) Nothing in this subsection annuls, limits, impairs, or
otherwise affects in any way the existence or value of any of
H. R. 2281—43
the exclusive rights of the copyright owners in a sound recording,
except as otherwise provided in this subsection, or in a musical
work, including the exclusive rights to reproduce and distribute
a sound recording or musical work, including by means of a digital
phonorecord delivery, under sections 106(1), 106(3), and 115, and
the right to perform publicly a sound recording or musical work,
including by means of a digital audio transmission, under sections
106(4) and 106(6).’’.
(c) SCOPE OF SECTION 112(a) OF TITLE 17 NOT AFFECTED.—
Nothing in this section or the amendments made by this section
shall affect the scope of section 112(a) of title 17, United States
Code, or the entitlement of any person to an exemption thereunder.
(d) PROCEDURAL AMENDMENTS TO CHAPTER 8.—Section 802 of
title 17, United States Code, is amended—
(1) in subsection (f )—
(A) in the first sentence by striking ‘‘60’’ and inserting
‘‘90’’; and
(B) in the third sentence by striking ‘‘that 60-day
period’’ and inserting ‘‘an additional 30-day period’’; and
(2) in subsection (g) by inserting after the second sentence
the following: ‘‘When this title provides that the royalty rates
or terms that were previously in effect are to expire on a
specified date, any adjustment by the Librarian of those rates
or terms shall be effective as of the day following the date
of expiration of the rates or terms that were previously in
effect, even if the Librarian’s decision is rendered on a later
date.’’.
(e) CONFORMING AMENDMENTS.—(1) Section 801(b)(1) of title
17, United States Code, is amended in the second sentence by
striking ‘‘sections 114, 115, and 116’’ and inserting ‘‘sections
114(f )(1)(B), 115, and 116’’.
(2) Section 802(c) of title 17, United States Code, is amended
by striking ‘‘section 111, 114, 116, or 119, any person entitled
to a compulsory license’’ and inserting ‘‘section 111, 112, 114, 116,
or 119, any transmitting organization entitled to a statutory license
under section 112(f ), any person entitled to a statutory license’’.
(3) Section 802(g) of title 17, United States Code, is amended
by striking ‘‘sections 111, 114’’ and inserting ‘‘sections 111, 112,
114’’.
(4) Section 802(h)(2) of title 17, United States Code, is amended
by striking ‘‘section 111, 114’’ and inserting ‘‘section 111, 112, 114’’.
(5) Section 803(a)(1) of title 17, United States Code, is amended
by striking ‘‘sections 114, 115’’ and inserting ‘‘sections 112, 114,
115’’.
(6) Section 803(a)(5) of title 17, United States Code, is
amended—
(A) by striking ‘‘section 114’’ and inserting ‘‘section 112
or 114’’; and
(B) by striking ‘‘that section’’ and inserting ‘‘those sections’’.
SEC. 406. ASSUMPTION OF CONTRACTUAL OBLIGATIONS RELATED TO
TRANSFERS OF RIGHTS IN MOTION PICTURES.
(a) IN GENERAL.—Part VI of title 28, United States Code, is
amended by adding at the end the following new chapter:
H. R. 2281—44
‘‘CHAPTER 180—ASSUMPTION OF CERTAIN
CONTRACTUAL OBLIGATIONS
‘‘Sec. 4001. Assumption of contractual obligations related to transfers of rights in
motion pictures.
‘‘§ 4001. Assumption of contractual obligations related to
transfers of rights in motion pictures
‘‘(a) ASSUMPTION OF OBLIGATIONS.—(1) In the case of a transfer
of copyright ownership under United States law in a motion picture
(as the terms ‘transfer of copyright ownership’ and ‘motion picture’
are defined in section 101 of title 17) that is produced subject
to 1 or more collective bargaining agreements negotiated under
the laws of the United States, if the transfer is executed on or
after the effective date of this chapter and is not limited to public
performance rights, the transfer instrument shall be deemed to
incorporate the assumption agreements applicable to the copyright
ownership being transferred that are required by the applicable
collective bargaining agreement, and the transferee shall be subject
to the obligations under each such assumption agreement to make
residual payments and provide related notices, accruing after the
effective date of the transfer and applicable to the exploitation
of the rights transferred, and any remedies under each such
assumption agreement for breach of those obligations, as those
obligations and remedies are set forth in the applicable collective
bargaining agreement, if—
‘‘(A) the transferee knows or has reason to know at the
time of the transfer that such collective bargaining agreement
was or will be applicable to the motion picture; or
‘‘(B) in the event of a court order confirming an arbitration
award against the transferor under the collective bargaining
agreement, the transferor does not have the financial ability
to satisfy the award within 90 days after the order is issued.
‘‘(2) For purposes of paragraph (1)(A), ‘knows or has reason
to know’ means any of the following:
‘‘(A) Actual knowledge that the collective bargaining agree-
ment was or will be applicable to the motion picture.
‘‘(B)(i) Constructive knowledge that the collective bargain-
ing agreement was or will be applicable to the motion picture,
arising from recordation of a document pertaining to copyright
in the motion picture under section 205 of title 17 or from
publication, at a site available to the public on-line that is
operated by the relevant union, of information that identifies
the motion picture as subject to a collective bargaining agree-
ment with that union, if the site permits commercially reason-
able verification of the date on which the information was
available for access.
‘‘(ii) Clause (i) applies only if the transfer referred to in
subsection (a)(1) occurs—
‘‘(I) after the motion picture is completed, or
‘‘(II) before the motion picture is completed and—
‘‘(aa) within 18 months before the filing of an
application for copyright registration for the motion
picture under section 408 of title 17, or
‘‘(bb) if no such application is filed, within 18
months before the first publication of the motion pic-
ture in the United States.
H. R. 2281—45
‘‘(C) Awareness of other facts and circumstances pertaining
to a particular transfer from which it is apparent that the
collective bargaining agreement was or will be applicable to
the motion picture.
‘‘(b) SCOPE OF EXCLUSION OF TRANSFERS OF PUBLIC PERFORM-
ANCE RIGHTS.—For purposes of this section, the exclusion under
subsection (a) of transfers of copyright ownership in a motion picture
that are limited to public performance rights includes transfers
to a terrestrial broadcast station, cable system, or programmer
to the extent that the station, system, or programmer is functioning
as an exhibitor of the motion picture, either by exhibiting the
motion picture on its own network, system, service, or station,
or by initiating the transmission of an exhibition that is carried
on another network, system, service, or station. When a terrestrial
broadcast station, cable system, or programmer, or other transferee,
is also functioning otherwise as a distributor or as a producer
of the motion picture, the public performance exclusion does not
affect any obligations imposed on the transferee to the extent that
it is engaging in such functions.
‘‘(c) EXCLUSION
FOR GRANTS
OF SECURITY INTERESTS.—Sub-
section (a) shall not apply to—
‘‘(1) a transfer of copyright ownership consisting solely
of a mortgage, hypothecation, or other security interest; or
‘‘(2) a subsequent transfer of the copyright ownership
secured by the security interest described in paragraph (1)
by or under the authority of the secured party, including a
transfer through the exercise of the secured party’s rights or
remedies as a secured party, or by a subsequent transferee.
The exclusion under this subsection shall not affect any rights
or remedies under law or contract.
‘‘(d) DEFERRAL PENDING RESOLUTION OF BONA FIDE DISPUTE.—
A transferee on which obligations are imposed under subsection
(a) by virtue of paragraph (1) of that subsection may elect to
defer performance of such obligations that are subject to a bona
fide dispute between a union and a prior transferor until that
dispute is resolved, except that such deferral shall not stay accrual
of any union claims due under an applicable collective bargaining
agreement.
‘‘(e) SCOPE OF OBLIGATIONS DETERMINED BY PRIVATE AGREE-
MENT.—Nothing in this section shall expand or diminish the rights,
obligations, or remedies of any person under the collective bargain-
ing agreements or assumption agreements referred to in this sec-
tion.
‘‘(f ) FAILURE TO NOTIFY.—If the transferor under subsection
(a) fails to notify the transferee under subsection (a) of applicable
collective bargaining obligations before the execution of the transfer
instrument, and subsection (a) is made applicable to the transferee
solely by virtue of subsection (a)(1)(B), the transferor shall be liable
to the transferee for any damages suffered by the transferee as
a result of the failure to notify.
‘‘(g) DETERMINATION OF DISPUTES AND CLAIMS.—Any dispute
concerning the application of subsections (a) through (f ) shall be
determined by an action in United States district court, and the
court in its discretion may allow the recovery of full costs by
or against any party and may also award a reasonable attorney’s
fee to the prevailing party as part of the costs.
H. R. 2281—46
‘‘(h) STUDY.—The Comptroller General, in consultation with
the Register of Copyrights, shall conduct a study of the conditions
in the motion picture industry that gave rise to this section, and
the impact of this section on the motion picture industry. The
Comptroller General shall report the findings of the study to the
Congress within 2 years after the effective date of this chapter.’’.
(b) CONFORMING AMENDMENT.—The table of chapters for part
VI of title 28, United States Code, is amended by adding at the
end the following:
‘‘180. Assumption of Certain Contractual Obligations .............................. 4001’’.
SEC. 407. EFFECTIVE DATE.
Except as otherwise provided in this title, this title and the
amendments made by this title shall take effect on the date of
the enactment of this Act.
TITLE V—PROTECTION OF CERTAIN
ORIGINAL DESIGNS
SEC. 501. SHORT TITLE.
This Act may be referred to as the ‘‘Vessel Hull Design Protec-
tion Act’’.
SEC. 502. PROTECTION OF CERTAIN ORIGINAL DESIGNS.
Title 17, United States Code, is amended by adding at the
end the following new chapter:
‘‘CHAPTER 13—PROTECTION OF ORIGINAL DESIGNS
‘‘Sec.
‘‘1301. Designs protected.
‘‘1302. Designs not subject to protection.
‘‘1303. Revisions, adaptations, and rearrangements.
‘‘1304. Commencement of protection.
‘‘1305. Term of protection.
‘‘1306. Design notice.
‘‘1307. Effect of omission of notice.
‘‘1308. Exclusive rights.
‘‘1309. Infringement.
‘‘1310. Application for registration.
‘‘1311. Benefit of earlier filing date in foreign country.
‘‘1312. Oaths and acknowledgments.
‘‘1313. Examination of application and issue or refusal of registration.
‘‘1314. Certification of registration.
‘‘1315. Publication of announcements and indexes.
‘‘1316. Fees.
‘‘1317. Regulations.
‘‘1318. Copies of records.
‘‘1319. Correction of errors in certificates.
‘‘1320. Ownership and transfer.
‘‘1321. Remedy for infringement.
‘‘1322. Injunctions.
‘‘1323. Recovery for infringement.
‘‘1324. Power of court over registration.
‘‘1325. Liability for action on registration fraudulently obtained.
‘‘1326. Penalty for false marking.
‘‘1327. Penalty for false representation.
‘‘1328. Enforcement by Treasury and Postal Service.
‘‘1329. Relation to design patent law.
‘‘1330. Common law and other rights unaffected.
‘‘1331. Administrator; Office of the Administrator.
‘‘1332. No retroactive effect.
‘‘§ 1301. Designs protected
‘‘(a) DESIGNS PROTECTED.—
H. R. 2281—47
‘‘(1) IN GENERAL.—The designer or other owner of an origi-
nal design of a useful article which makes the article attractive
or distinctive in appearance to the purchasing or using public
may secure the protection provided by this chapter upon
complying with and subject to this chapter.
‘‘(2) VESSEL HULLS.—The design of a vessel hull, including
a plug or mold, is subject to protection under this chapter,
notwithstanding section 1302(4).
‘‘(b) DEFINITIONS.—For the purpose of this chapter, the
following terms have the following meanings:
‘‘(1) A design is ‘original’ if it is the result of the designer’s
creative endeavor that provides a distinguishable variation over
prior work pertaining to similar articles which is more than
merely trivial and has not been copied from another source.
‘‘(2) A ‘useful article’ is a vessel hull, including a plug
or mold, which in normal use has an intrinsic utilitarian func-
tion that is not merely to portray the appearance of the article
or to convey information. An article which normally is part
of a useful article shall be deemed to be a useful article.
‘‘(3) A ‘vessel’ is a craft, especially one larger than a row-
boat, designed to navigate on water, but does not include any
such craft that exceeds 200 feet in length.
‘‘(4) A ‘hull’ is the frame or body of a vessel, including
the deck of a vessel, exclusive of masts, sails, yards, and rigging.
‘‘(5) A ‘plug’ means a device or model used to make a
mold for the purpose of exact duplication, regardless of whether
the device or model has an intrinsic utilitarian function that
is not only to portray the appearance of the product or to
convey information.
‘‘(6) A ‘mold’ means a matrix or form in which a substance
for material is used, regardless of whether the matrix or form
has an intrinsic utilitarian function that is not only to portray
the appearance of the product or to convey information.
‘‘§ 1302. Designs not subject to protection
‘‘Protection under this chapter shall not be available for a
design that is—
‘‘(1) not original;
‘‘(2) staple or commonplace, such as a standard geometric
figure, a familiar symbol, an emblem, or a motif, or another
shape, pattern, or configuration which has become standard,
common, prevalent, or ordinary;
‘‘(3) different from a design excluded by paragraph (2)
only in insignificant details or in elements which are variants
commonly used in the relevant trades;
‘‘(4) dictated solely by a utilitarian function of the article
that embodies it; or
‘‘(5) embodied in a useful article that was made public
by the designer or owner in the United States or a foreign
country more than 1 year before the date of the application
for registration under this chapter.
‘‘§ 1303. Revisions, adaptations, and rearrangements
‘‘Protection for a design under this chapter shall be available
notwithstanding the employment in the design of subject matter
excluded from protection under section 1302 if the design is a
substantial revision, adaptation, or rearrangement of such subject
H. R. 2281—48
matter. Such protection shall be independent of any subsisting
protection in subject matter employed in the design, and shall
not be construed as securing any right to subject matter excluded
from protection under this chapter or as extending any subsisting
protection under this chapter.
‘‘§ 1304. Commencement of protection
‘‘The protection provided for a design under this chapter shall
commence upon the earlier of the date of publication of the registra-
tion under section 1313(a) or the date the design is first made
public as defined by section 1310(b).
‘‘§ 1305. Term of protection
‘‘(a) IN GENERAL.—Subject to subsection (b), the protection
provided under this chapter for a design shall continue for a term
of 10 years beginning on the date of the commencement of protection
under section 1304.
‘‘(b) EXPIRATION.—All terms of protection provided in this
section shall run to the end of the calendar year in which they
would otherwise expire.
‘‘(c) TERMINATION OF RIGHTS.—Upon expiration or termination
of protection in a particular design under this chapter, all rights
under this chapter in the design shall terminate, regardless of
the number of different articles in which the design may have
been used during the term of its protection.
‘‘§ 1306. Design notice
‘‘(a) CONTENTS OF DESIGN NOTICE.—(1) Whenever any design
for which protection is sought under this chapter is made public
under section 1310(b), the owner of the design shall, subject to
the provisions of section 1307, mark it or have it marked legibly
with a design notice consisting of—
‘‘(A) the words ‘Protected Design’, the abbreviation ‘Prot’d
Des.’, or the letter ‘D’ with a circle, or the symbol ‘*D*’;
‘‘(B) the year of the date on which protection for the design
commenced; and
‘‘(C) the name of the owner, an abbreviation by which
the name can be recognized, or a generally accepted alternative
designation of the owner.
Any distinctive identification of the owner may be used for purposes
of subparagraph (C) if it has been recorded by the Administrator
before the design marked with such identification is registered.
‘‘(2) After registration, the registration number may be used
instead of the elements specified in subparagraphs (B) and (C)
of paragraph (1).
‘‘(b) LOCATION OF NOTICE.—The design notice shall be so located
and applied as to give reasonable notice of design protection while
the useful article embodying the design is passing through its
normal channels of commerce.
‘‘(c) SUBSEQUENT REMOVAL OF NOTICE.—When the owner of
a design has complied with the provisions of this section, protection
under this chapter shall not be affected by the removal, destruction,
or obliteration by others of the design notice on an article.
‘‘§ 1307. Effect of omission of notice
‘‘(a) ACTIONS WITH NOTICE.—Except as provided in subsection
(b), the omission of the notice prescribed in section 1306 shall
H. R. 2281—49
not cause loss of the protection under this chapter or prevent
recovery for infringement under this chapter against any person
who, after receiving written notice of the design protection, begins
an undertaking leading to infringement under this chapter.
‘‘(b) ACTIONS WITHOUT NOTICE.—The omission of the notice
prescribed in section 1306 shall prevent any recovery under section
1323 against a person who began an undertaking leading to
infringement under this chapter before receiving written notice
of the design protection. No injunction shall be issued under this
chapter with respect to such undertaking unless the owner of the
design reimburses that person for any reasonable expenditure or
contractual obligation in connection with such undertaking that
was incurred before receiving written notice of the design protection,
as the court in its discretion directs. The burden of providing
written notice of design protection shall be on the owner of the
design.
‘‘§ 1308. Exclusive rights
‘‘The owner of a design protected under this chapter has the
exclusive right to—
‘‘(1) make, have made, or import, for sale or for use in
trade, any useful article embodying that design; and
‘‘(2) sell or distribute for sale or for use in trade any
useful article embodying that design.
‘‘§ 1309. Infringement
‘‘(a) ACTS OF INFRINGEMENT.—Except as provided in subsection
(b), it shall be infringement of the exclusive rights in a design
protected under this chapter for any person, without the consent
of the owner of the design, within the United States and during
the term of such protection, to—
‘‘(1) make, have made, or import, for sale or for use in
trade, any infringing article as defined in subsection (e); or
‘‘(2) sell or distribute for sale or for use in trade any
such infringing article.
‘‘(b) ACTS OF SELLERS AND DISTRIBUTORS.—A seller or distribu-
tor of an infringing article who did not make or import the article
shall be deemed to have infringed on a design protected under
this chapter only if that person—
‘‘(1) induced or acted in collusion with a manufacturer
to make, or an importer to import such article, except that
merely purchasing or giving an order to purchase such article
in the ordinary course of business shall not of itself constitute
such inducement or collusion; or
‘‘(2) refused or failed, upon the request of the owner of
the design, to make a prompt and full disclosure of that person’s
source of such article, and that person orders or reorders such
article after receiving notice by registered or certified mail
of the protection subsisting in the design.
‘‘(c) ACTS WITHOUT KNOWLEDGE.—It shall not be infringement
under this section to make, have made, import, sell, or distribute,
any article embodying a design which was created without knowl-
edge that a design was protected under this chapter and was
copied from such protected design.
‘‘(d) ACTS IN ORDINARY COURSE OF BUSINESS.—A person who
incorporates into that person’s product of manufacture an infringing
article acquired from others in the ordinary course of business,