Source: http://uscode.house.gov/view.xhtml?path=/prelim@title17/chapter10&edition=prelim
Timestamp: 2019-04-23 02:24:09+00:00

Document:
Obligation to make royalty payments.
Deposit of royalty payments and deduction of expenses.
Procedures for distributing royalty payments.
Prohibition on certain infringement actions.
2004—Pub. L. 108–419, §5(i)(4)(B), Nov. 30, 2004, 118 Stat. 2369, substituted "Determination" for "Arbitration" in item 1010.
(1) A "digital audio copied recording" is a reproduction in a digital recording format of a digital musical recording, whether that reproduction is made directly from another digital musical recording or indirectly from a transmission.
(2) A "digital audio interface device" is any machine or device that is designed specifically to communicate digital audio information and related interface data to a digital audio recording device through a nonprofessional interface.
(4)(A) A "digital audio recording medium" is any material object in a form commonly distributed for use by individuals, that is primarily marketed or most commonly used by consumers for the purpose of making digital audio copied recordings by use of a digital audio recording device.
(ii) the term "incidental" means related to and relatively minor by comparison.
(6) "Distribute" means to sell, lease, or assign a product to consumers in the United States, or to sell, lease, or assign a product in the United States for ultimate transfer to consumers in the United States.
(8) To "manufacture" means to produce or assemble a product in the United States. A "manufacturer" is a person who manufactures.
(9) A "music publisher" is a person that is authorized to license the reproduction of a particular musical work in a sound recording.
(10) A "professional model product" is an audio recording device that is designed, manufactured, marketed, and intended for use by recording professionals in the ordinary course of a lawful business, in accordance with such requirements as the Secretary of Commerce shall establish by regulation.
(11) The term "serial copying" means the duplication in a digital format of a copyrighted musical work or sound recording from a digital reproduction of a digital musical recording. The term "digital reproduction of a digital musical recording" does not include a digital musical recording as distributed, by authority of the copyright owner, for ultimate sale to consumers.
(13) A "writer" is the composer or lyricist of a particular musical work.
Section 482 of the Internal Revenue Code of 1986, referred to in par. (12)(B), is classified to section 482 of Title 26, Internal Revenue Code.
Pub. L. 102–563, §4, Oct. 28, 1992, 106 Stat. 4248, provided that: "This Act [see Short Title of 1992 Amendment note set out under section 101 of this title] and the amendments made by this Act shall take effect on the date of the enactment of this Act [Oct. 28, 1992]."
(3) any other system certified by the Secretary of Commerce as prohibiting unauthorized serial copying.
(b) Development of Verification Procedure.—The Secretary of Commerce shall establish a procedure to verify, upon the petition of an interested party, that a system meets the standards set forth in subsection (a)(2).
(c) Prohibition on Circumvention of the System.—No person shall import, manufacture, or distribute any device, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent any program or circuit which implements, in whole or in part, a system described in subsection (a).
(1) Prohibition on encoding inaccurate information.—No person shall encode a digital musical recording of a sound recording with inaccurate information relating to the category code, copyright status, or generation status of the source material for the recording.
(2) Encoding of copyright status not required.—Nothing in this chapter requires any person engaged in the importation or manufacture of digital musical recordings to encode any such digital musical recording with respect to its copyright status.
(e) Information Accompanying Transmissions in Digital Format.—Any person who transmits or otherwise communicates to the public any sound recording in digital format is not required under this chapter to transmit or otherwise communicate the information relating to the copyright status of the sound recording. Any such person who does transmit or otherwise communicate such copyright status information shall transmit or communicate such information accurately.
(1) Amount of payment.—The royalty payment due under section 1003 for each digital audio recording device imported into and distributed in the United States, or manufactured and distributed in the United States, shall be 2 percent of the transfer price. Only the first person to manufacture and distribute or import and distribute such device shall be required to pay the royalty with respect to such device.
(A) If the digital audio recording device and such other devices are part of a physically integrated unit, the royalty payment shall be based on the transfer price of the unit, but shall be reduced by any royalty payment made on any digital audio recording device included within the unit that was not first distributed in combination with the unit.
(B) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on the average transfer price of such devices during those 4 quarters.
(C) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have not been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on a constructed price reflecting the proportional value of such device to the combination as a whole.
(3) Limits on royalties.—Notwithstanding paragraph (1) or (2), the amount of the royalty payment for each digital audio recording device shall not be less than $1 nor more than the royalty maximum. The royalty maximum shall be $8 per device, except that in the case of a physically integrated unit containing more than 1 digital audio recording device, the royalty maximum for such unit shall be $12. During the 6th year after the effective date of this chapter, and not more than once each year thereafter, any interested copyright party may petition the Copyright Royalty Judges to increase the royalty maximum and, if more than 20 percent of the royalty payments are at the relevant royalty maximum, the Copyright Royalty Judges shall prospectively increase such royalty maximum with the goal of having no more than 10 percent of such payments at the new royalty maximum; however the amount of any such increase as a percentage of the royalty maximum shall in no event exceed the percentage increase in the Consumer Price Index during the period under review.
(b) Digital Audio Recording Media.—The royalty payment due under section 1003 for each digital audio recording medium imported into and distributed in the United States, or manufactured and distributed in the United States, shall be 3 percent of the transfer price. Only the first person to manufacture and distribute or import and distribute such medium shall be required to pay the royalty with respect to such medium.
The effective date of this chapter, referred to in subsec. (a)(3), is Oct. 28, 1992. See Effective Date note set out under section 1001 of this title.
2004—Subsec. (a)(3). Pub. L. 108–419 substituted "Copyright Royalty Judges" for "Librarian of Congress" in two places.
1993—Subsec. (a)(3). Pub. L. 103–198 substituted "Librarian of Congress" for "Copyright Royalty Tribunal" after "may petition the" and for "Tribunal" before "shall prospectively".
The Register of Copyrights shall receive all royalty payments deposited under this chapter and, after deducting the reasonable costs incurred by the Copyright Office under this chapter, shall deposit the balance in the Treasury of the United States as offsetting receipts, in such manner as the Secretary of the Treasury directs. All funds held by the Secretary of the Treasury shall be invested in interest-bearing United States securities for later distribution with interest under section 1007. The Register may, in the Register's discretion, 4 years after the close of any calendar year, close out the royalty payments account for that calendar year, and may treat any funds remaining in such account and any subsequent deposits that would otherwise be attributable to that calendar year as attributable to the succeeding calendar year.
1993—Pub. L. 103–198 struck out at end "The Register shall submit to the Copyright Royalty Tribunal, on a monthly basis, a financial statement reporting the amount of royalties under this chapter that are available for distribution."
(2) who has filed a claim under section 1007.
(1) The sound recordings fund.—662/3 percent of the royalty payments shall be allocated to the Sound Recordings Fund. 25/8 percent of the royalty payments allocated to the Sound Recordings Fund shall be placed in an escrow account managed by an independent administrator jointly appointed by the interested copyright parties described in section 1001(7)(A) and the American Federation of Musicians (or any successor entity) to be distributed to nonfeatured musicians (whether or not members of the American Federation of Musicians or any successor entity) who have performed on sound recordings distributed in the United States. 13/8 percent of the royalty payments allocated to the Sound Recordings Fund shall be placed in an escrow account managed by an independent administrator jointly appointed by the interested copyright parties described in section 1001(7)(A) and the American Federation of Television and Radio Artists (or any successor entity) to be distributed to nonfeatured vocalists (whether or not members of the American Federation of Television and Radio Artists or any successor entity) who have performed on sound recordings distributed in the United States. 40 percent of the remaining royalty payments in the Sound Recordings Fund shall be distributed to the interested copyright parties described in section 1001(7)(C), and 60 percent of such remaining royalty payments shall be distributed to the interested copyright parties described in section 1001(7)(A).
(A) 331/3 percent of the royalty payments shall be allocated to the Musical Works Fund for distribution to interested copyright parties described in section 1001(7)(B).
(B)(i) Music publishers shall be entitled to 50 percent of the royalty payments allocated to the Musical Works Fund.
(ii) Writers shall be entitled to the other 50 percent of the royalty payments allocated to the Musical Works Fund.
(2) for the Musical Works Fund, each musical work was distributed in the form of digital musical recordings or analog musical recordings or disseminated to the public in transmissions.
2004—Subsec. (c). Pub. L. 108–419 substituted "Copyright Royalty Judges" for "Librarian of Congress shall convene a copyright arbitration royalty panel which" in introductory provisions.
1997—Subsec. (b)(1). Pub. L. 105–80 substituted "Federation of Television" for "Federation Television" before "and Radio Artists or any successor entity)".
1993—Subsec. (c). Pub. L. 103–198 substituted "Librarian of Congress shall convene a copyright arbitration royalty panel which" for "Copyright Royalty Tribunal" in introductory provisions.
2006—Subsec. (b). Pub. L. 109–303, §4(f)(1), substituted "Copyright Royalty Judges" for "Librarian of Congress" in second sentence and struck out "by the Librarian" after "administrative costs incurred" in last sentence.
Subsec. (c). Pub. L. 109–303, §4(f)(2), struck out "by the Librarian" after "administrative costs incurred" in last sentence.
2004—Subsec. (a)(1). Pub. L. 108–419, §5(i)(3)(A), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: "During the first 2 months of each calendar year after calendar year 1992, every interested copyright party seeking to receive royalty payments to which such party is entitled under section 1006 shall file with the Librarian of Congress a claim for payments collected during the preceding year in such form and manner as the Librarian of Congress shall prescribe by regulation."
Subsec. (b). Pub. L. 108–419, §5(i)(3)(B), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: "After the period established for the filing of claims under subsection (a), in each year after 1992, the Librarian of Congress shall determine whether there exists a controversy concerning the distribution of royalty payments under section 1006(c). If the Librarian of Congress determines 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), after deducting its reasonable administrative costs under this section."
Subsec. (c). Pub. L. 108–419, §5(i)(3)(B), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: "If the Librarian of Congress finds the existence of a controversy, the Librarian shall, pursuant to chapter 8 of this title, convene a copyright arbitration royalty panel to determine the distribution of royalty payments. During the pendency of such a proceeding, the Librarian of Congress 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 authorizing the distribution of such royalty payments, deduct the reasonable administrative costs incurred by the Librarian under this section."
1997—Subsec. (a)(1). Pub. L. 105–80, §12(a)(25)(A), substituted "calendar year 1992" for "the calendar year in which this chapter takes effect".
Subsec. (b). Pub. L. 105–80, §§9, 12(a)(25)(B), substituted "After the period established" for "Within 30 days after the period established" and "each year after 1992" for "each year after the year in which this section takes effect".
1993—Subsec. (a)(1). Pub. L. 103–198, §6(b)(4)(A), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" before "a claim for" and for "Tribunal" before "shall prescribe".
Subsec. (b). Pub. L. 103–198, §6(b)(4)(B), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" before "shall determine whether" and for "Tribunal" wherever appearing.
Subsec. (c). Pub. L. 103–198, §6(b)(4)(C), substituted first sentence for "If the Tribunal finds the existence of a controversy, it shall, pursuant to chapter 8 of this title, conduct a proceeding to determine the distribution of royalty payments.", substituted "Librarian of Congress" for "Tribunal" wherever appearing in second and third sentences, and "the reasonable administrative costs incurred by the Librarian" for "its reasonable administrative costs" in last sentence.
(a) Civil Actions.—Any interested copyright party injured by a violation of section 1002 or 1003 may bring a civil action in an appropriate United States district court against any person for such violation.
(b) Other Civil Actions.—Any person injured by a violation of this chapter may bring a civil action in an appropriate United States district court for actual damages incurred as a result of such violation.
(4) in its discretion may award a reasonable attorney's fee to the prevailing party.
(A) Actual damages.—(i) In an action brought under subsection (a), if the court finds that a violation of section 1002 or 1003 has occurred, the court shall award to the complaining party its actual damages if the complaining party elects such damages at any time before final judgment is entered.
(ii) In the case of section 1003, actual damages shall constitute the royalty payments that should have been paid under section 1004 and deposited under section 1005. In such a case, the court, in its discretion, may award an additional amount of not to exceed 50 percent of the actual damages.
(i) Device.—A complaining party may recover an award of statutory damages for each violation of section 1002(a) or (c) in the sum of not more than $2,500 per device involved in such violation or per device on which a service prohibited by section 1002(c) has been performed, as the court considers just.
(ii) Digital musical recording.—A complaining party may recover an award of statutory damages for each violation of section 1002(d) in the sum of not more than $25 per digital musical recording involved in such violation, as the court considers just.
(iii) Transmission.—A complaining party may recover an award of damages for each transmission or communication that violates section 1002(e) in the sum of not more than $10,000, as the court considers just.
(2) Repeated violations.—In any case in which the court finds that a person has violated section 1002 or 1003 within 3 years after a final judgment against that person for another such violation was entered, the court may increase the award of damages to not more than double the amounts that would otherwise be awarded under paragraph (1), as the court considers just.
(3) Innocent violations of section 1002.—The court in its discretion may reduce the total award of damages against a person violating section 1002 to a sum of not less than $250 in any case in which the court finds that the violator was not aware and had no reason to believe that its acts constituted a violation of section 1002.
(e) Payment of Damages.—Any award of damages under subsection (d) shall be deposited with the Register pursuant to section 1005 for distribution to interested copyright parties as though such funds were royalty payments made pursuant to section 1003.
(f) Impounding of Articles.—At any time while an action under subsection (a) is pending, the court may order the impounding, on such terms as it deems reasonable, of any digital audio recording device, digital musical recording, or device specified in section 1002(c) that is in the custody or control of the alleged violator and that the court has reasonable cause to believe does not comply with, or was involved in a violation of, section 1002.
(2) is in the custody or control of the violator or has been impounded under subsection (f).
(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. 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.
2004—Pub. L. 108–419 amended section catchline and text generally, substituting provisions relating to determination of certain disputes for provisions relating to arbitration of certain disputes.
1993—Subsec. (b). Pub. L. 103–198, §6(b)(5)(A), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" before "requesting the commencement" and for "Tribunal" wherever appearing.
Subsec. (e). Pub. L. 103–198, §6(b)(5)(B), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" in heading and text.
Subsec. (f). Pub. L. 103–198, §6(b)(5)(C), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" in heading and before "shall adopt or reject" in text, substituted "Librarian of Congress" for "Tribunal" wherever appearing, and substituted "the Librarian's" for "its".
Subsec. (g). Pub. L. 103–198, §6(b)(5)(D), substituted "Librarian of Congress" for "Copyright Royalty Tribunal" after "Any decision of the", "decision of the Librarian of Congress" for "Tribunal's decision" in second sentence, and "Librarian of Congress" for "Tribunal" wherever appearing in third through fifth sentences.

References: §5
 §4
 §4
 §4
 §5
 §5
 §5
 §12
 §6
 §6
 §6
 §6
 §6
 §6
 §6