Mr. BURKAN. I differ with you as to the success creating qualities of these other agencies. They do not create and never have created any commercial success for any song. The manufacturers do not reproduce works that are unknown, or for which there is no popular appeal. The work of reproduction is not undertaken until the commercial success of the song has been established-until the composer and publisher have created and made a popular demand for a piece of music, at the expenditure of money, time, labor and organization to place it before the public, to introduce it in the general market and to create a popular demand therefor. Why should manufacturers waste their time making records of dead numbers, or numbers that are unknown, when they could just as easily appropriate such songs as already have established their pleasing and attractive qualities, and have met with popular favor, and for which there is a great popular demand.. The manufacturers take only the most successful and most phenomenal song hits of the day for the purpose of reproduction. They do not spend their money popularizing dead songs, when there are live songs to be seized on. Mr. REID of Illinois. Don't they compete with other roll makers? Mr. BURKAN. Not at all; not in the slightest degree. They are protected against the reproduction of their particular rolls and records. They have long term contracts for the exclusive services of famous singers, pianists, violinists, orchestra and band leaders, and no one is permitted to reproduce the renditions of songs made by these exclusive artists. They have the most perfect price-fixing and price-making agreements, under which they have the most absolute control of their song reproductions, which point I am going to develop a little later. Don't be alarmed about that at all; there is no competition at all between these manufacturers. They have created the most powerful trust ever conceived of. Mr. REID of Illinois. If they have a trust as good as you have, and they can come up to your trust, I am for them. Mr. BURKAN. Now then, some more interesting little experiences: La Belle Phonograph Co., of New York, N. Y., another irresponsible and dishonest concern, operating along the same lines, and which, when the day came that it was forced to face its obligations to copyright owners, disappeared from the scene, abandoning a few dollars' worth of secondhand furniture left to remind the landlord as well as the copyright owner that this is an uncertain life at best. Thus, the composer is deprived of his property. Statements are not furnished, royalties not paid. If you sue, you probably get a decree for $75, with a temporary injunction until the amount fixed by the decree is paid. But there is nothing for the sheriff to seize upon to make good the amount of the judgment. Mr. PERKINS. May I just ask you, is it your idea that if there were a criminal penalty attached that that would be prevented? Mr. BURKAN. But that would not aid any, for this reason, that these people either change their names or organize new companies to succeed the defunct ones. The stockholders of the Criterion Records (Inc.) organized a new company the next week, following bankruptcy, under a new name. Mr. PERKINS. How can you protect yourselves? Mr. BURKAN. We can protect ourselves by your giving us what your bill is aimed to do. It would give us the same control over the reproduction of our works on records and rolls as the existing law gives to the author of a drama, novel, or short story in the case of their reproduction in motion pictures. The existing law adequately protects by drastic, adequate and plenary remedies the dramatic author, novelist, and story writer. Equal protection should be given to the song writer. We feel that we are entitled to be upon the same equality, upon the same plane as any other author, and we should not be discriminated against by the law. There is an arbitrary discrimination in this law against one class of writers as against every other class of writers in the world. There is no justification for it, nor reason for it, and no justice in it. No other users of copyrighted works enjoy the privileges and immunities under the law as do the mechanical manufacturers. Every other user of copyrighted material is discriminated against. The Emerson Phonograph Co., of New York. This company was the manufacturer of phonograph records. It reproduced the most popular, the most sensational song hits, paid no royalties, and finally went into bankruptcy. Now it has come back to life again under the name of Emerson Radio and Phonograph Corporation. In a publication that I received a few days ago, known as the Broadcaster Radio Securities Review, an announcement was made of the fact that the Emerson Radio & Phonograph Corporation succeeds the Emerson Phonograph Corporation, whose trade-marked records and phonographs are known to more than a million people in the United States and the leading foreign countries. Emerson radio and phonograph shares are selling at a price of $8 per share. The publication contains the announcement that the Emerson radio and phonograph business "has been highly satisfactory and the company will, of course, continue to expand this very profitable field. In fact, two additional large jobbers were recently appointed, one in Chicago and the other in Canada." So here is a declaration that they are going to continue manufacturing records; they are going to sell them; they will probably make no accountings, pay no royalties; the public will probably be loaded up with the stock of the new corporation. If a collapse comes, all we will get for our pains is perhaps a temporary injunction until payment is made upon a statement of records manufactured upon a basis not exceeding 6 cents per record. Mr. BLOOM. And, yet, Mr. Burkan, you have no way of preventing them manufacturing your songs? Mr. BURKAN. We can not do a thing; we are helpless; we can not do anything. Mr. VESTAL. How about the public which buys the stock? They are scooped about as bad as you are? Mr. BURKAN. They are scooped just about as bad as we are. Mr. PERKINS. There is one difference-they have an option, and you have not?. Mr. BURKAN. We have not. Next I will mention another group of ill-fated manufacturers: Pathe Freres Phonograph Co., New York, N. Y.; Regal Record Co., New York, N. Y.; Regina Phonograph Co., Rahway, N. J.; Record Manufacturing Co., Framingham, Mass.; Bennett & White, Newark, N. J. Four of this group were manufacturers of phonograph records and one of player-piano rolls; at different times during the past five years they have gone into bankruptcy, or some sort of insolvency proceedings, with losses to copyright owners exceeding a quarter of a million dollars. The Arto Co., Orange, N. J., a concern with which difficulties in securing royalty accountings were always experienced, which went into bankruptcy, and with the receiver of which copyright owners have been unable to establish satisfactory royalty accounting relationships. Billings Player Roll Co., Milwaukee, Wis. In financial difficulties, and as an alternative to bankruptcy, copyright owners accepted settlement of their claims at 25 cents on the dollar. Mr. PERKINS. They come over from New York after being overhauled by Mr. Burkan. Mr. REID of Illinois. Are there any good companies? Mr. BURKAN. Yes; and I am going to show you how good they are. Now, I am reading a report of the Victor Talking Machine Co. of New Jersey. Mr. BLOOM. New Jersey also? Mr. BURKAN. New Jersey, also. The Victor Talking Machine Co. submitted a report to G. Ricordi & Co. on one of the greatest song hits that ever struck this country, Dear Old Pal of Mine; for the quarter ending September 30, 1922, they gave a report on two records. Do you believe they manufactured only two records; do you believe they struck off only two records? In this particular case there was no contract between the publisher and the Victor Talking Machine Co. The contract was one fixed by law. The purpose of requiring payment of royalties on records manufactured was to get away from the idea of making returns on sales only. So that just the moment the record was manufactured the composer would be entitled to his royalty thereon. Mr. PERKINS. I can understand that. One was for the singer and the other was for the "Pal"? Mr. BURKAN, That is right; for the quarter ending September 30, 1923 Mr. REID of Illinois (interposing). Do you distinguish between the publishers and the authors in all these comments? Mr. BURKAN. The publisher is simply the business agent of the composer. The composer himself has no facilities for handling these things. Mr. REID of Illinois. He lives well off of the composer? Mr. BURKAN. The publisher does he lives very well. You saw Harry von Tilzer and Charles K. Harris, who appeared before your committee at the last hearing; that gives you some idea how well they live. You have been told here in the record that some 10 or 12 publishers have gone out of business in the last year. That is how well they live. I could go one step further and say I do not think more than 12 publishers out of the 34 operating in the United States are financially responsible. Mr. REID of Illinois. All this time you are talking about the publisher and not the author. Mr. BURKAN. I am addressing my remarks to the relations between. the manufacturer of rolls and records and the composer. The publisher is simply the business agent of the composer. Mr. REID of Illinois. But you are talking about the publisher? Mr. BURKAN. Yes. And here is the same Victor Talking Machine Co. giving a report for the quarter ending September 30, 1923, on "Your Eyes Have Told Me," sung by Caruso. The report is for one record. Do you believe they manufactured but one record of that song by Caruso? And for the quarter ending December 31, 1923, on the song "Tarantella Sincer," sung by Caruso, 14 records. For the quarter ending March 31, 1924, this same Victor Co. gives a report of 13 records of "Sono Romerrez," 2 records of "My Clarabelle," 2 records of "Minor and Major," and 1 record of "Tally Ho." We all know that these companies do not strike off one single record; it would not pay them. Mr. REID of Illinois. Are you distinguishing between what they make to sell and what they make? Mr. BURKAN. The law does not say anything about "sale." The law says they shall render their reports upon the instruments manufactured. Mr. REID of Illinois. For sale? Mr. BURKAN. No, sir; "manufactured" is the wording of the act. There is nothing said about "sale," manufactured is the sole word. You will find that on page 8, line 15. [Reading:] That whenever the owner of a musical copyright has used or permitted or knowingly acquiesced in the use of the copyrighted work upon the parts of instruments serving to reproduce mechanically the musical work, any other person may make similar use of the copyrighted work upon the payment to the copyright proprietor of a royalty of 2 cents on each such part manufactured, to be paid by the manufacturer thereof; and the copyright proprietor may require, and if so the manufacturer shall furnish, a report under oath on the twentieth day of each month on the number of parts of instruments manufactured during the previous month serving to reproduce mechanically said musical work, and royalties shall be due on the parts manufactured during any month upon the 20th of the next succeeding month. Mr. BLOOM. Mr. Burkan, do I understand you to say for the quarter? Mr. BURKAN. The Victor reports I have read are for the quarter. Mr. BLOOм. They, according to the law, are supposed to furnish a statement on the 20th of each month. This is for three months, then? Mr. BURKAN. They never furnished these people monthly reports. The day after the law was enacted they got together and prepared a form of a contract. Some publishers and some composers accepted those contracts, and they departed in every particular from the law. Mr. BLOOм. Then this one and two records that you called off is for three months and not for one month? Mr. BURKAN. Right. Mr. REID of Illinois. Are you objecting because they contracted differently from the law? Mr. BURKAN. No. I am objecting for this reason: In this particular case there was no contract. The contract was the one fixed by the law, and notwithstanding the provisions of the law they furnished a statement showing that in a quarter they sold but a single record. Mr. REID of Illinois. I thought you answered Mr. Bloom's question to the effect that these people got together and settled the matter by contract. Mr. BURKAN. I am going further than that. Notwithstanding the magnanimity of this law toward them, they were not satisfied with it. Mr. WEFALD. May I ask you a question? In that instance where you spoke of that one record by Caruso, did he ask for an accounting? Mr. BURKAN. We have nothing to do with Caruso. Caruso did not get 2 cents on this record; what Caruso got was 25 cents per record, because Caruso had the right to go wherever he pleased and sing his song whenever he pleased for any recording company he pleased. Therefore, with Caruso they bargained and they got an exclusive contract with him, but they had to pay him 25 cents per record. No other company had the right to use Caruso's services on sound records.. Mr. REID of Illinois. Then they have opened up the whole world for anybody who can sing. Mr. BURKAN. No; not for anybody. Mr. REID of Illinois. If Caruso did it, anybody else can do it. Mr. WEFALD. Evidently he was not aggrieved. Mr. PERKINS. No; this statement did not go to Caruso. Mr. BLOOM. This is for the owner of the copyright, is it not? Mr. BURKAN. Yes; this report. I am not here fighting for the Caruso estate. He only sang the song; I am fighting for the composer who wrote it and made it possible for Caruso to sing it and earn 25 cents upon every record reproducing his singing. Mr. WEFALD. So in this instance the composer was aggrieved? Mr. BURKAN. Yes, sir; and I am here relating his grievance. Mr. REID of Illinois. Was there any copyright on the mechanical part under the 1909 law? Mr. BURKAN. There was no copyright. Although in the case of Aeolian Co. v. Royal Music Roll Co. (196 Fed. 926), Judge Hazel held that where a roll company manufactured a roll that reproduced mechanically a musical composition no subsequent manufacturer can avail himself of the skill and labor of the original manufacturer of the perforated roll or record by copying or duplicating the same, but must resort to the copyrighted composition or sheet music of the competitor who has made the original perforated roll. It would be illegal to my mind for any other record manufacturer to copy a record containing a reproduction of Caruso's voice. That, to my mind, could be enjoined not upon the copyright law, but upon the theory of unfair competition. I want to offer for the record similar reports with respect to the Victor Co. (The other reports of the Victor Co. submitted by Mr. Burkan are as follows:) Mr. BURKAN. There is another company known as the Brunswick Co. This Brunswick Co. is engaged in the business of manufactur |