responsibility for maintenance, record replacement, and registration with that individual owner. We were able to negotiate with the per forming rights societies a voluntary agreement which provided rebates - in essence, reductions - on the license rate for 1985 and, after months of debate over technicalities, for part of 1986. But with the continuing decline in operator-owned locations, targets set in this agreement for rebates in 1987 have been missed. Unless this agreement is revised, future targets will also be missed. We have a reverse chicken-and-egg situation: as fees go up, individual locations, which are less likely to register have an economic advantage over larger operators; ownership of jukeboxes therefore shifts to individual locations; registrations decline still further; and the burden falls all the more heavily on the responsible firms which comply. Enforcement is difficult and ownership by responsible businessmen is discouraged. We describe this history to illustrate that the existing compulsory jukebox license, as presently operating and presently enforced - that is, discriminatorily and unequally - is a far from perfect system. We hope to develop recommendations for improvement in this system. However, to discard this system with nothing better in its place, would be the end of the American Jukebox tradition. Similarly, to throw out the compulsory license for works of foreign origin would serve only to end all playing of foreign works on jukeboxes in the U.S. This would hardly be of benefit to foreign composers; and we wonder if such action could lead to retaliation against U.S. composers overseas. In this context, we support H.R. 1623, as introduced by Mr. Kastenmeier and Mr. Moorhead and co-sponsored by several other distinguished members of this committee. Section 8, preserving voluntary negotiations, with the compulsory license to take effect if these negotiations fail, is the best solution now available. This Section would make U.S. law compatible with Berne without throwing out the compulsory license or closing off the possibility of a better system in the future. Dr. Arpad Bogsch, director general of the World Intellectual Property Organization (which administers the Berne Convention), in material submitted for the record of hearings in the Senate Judiciary Committee in 1985, reported that some Berne Convention countries have a de facto compulsory license and confirmed that provisions similar to those in Section 8 of H.R. 1623 would be compatible with Berne. In conclusion, Mr. Chairman, we believe it is essential that the record of this legislation, if not the legislation itself, make clear the view of this Committee and the Congress that Berne not be self-executing. Adherence to Berne neither changes U.S. law nor rules out further refinements in U.S. copyright law in the future. Until or unless the Congress should choose to make further changes in law, the existing compulsory license would be retained under H.R. 1623, taking effect if we and the copyright societies are unable voluntarily to agree on better and more equitable systems. Nor, by the same coin, would U.S. adherence to Berne prevent the Congress from considering future revisions to the existing compulsory license. H.R. 1623, in conclusion, is a carefully-crafted bill. It preserves the option that copyright owners and jukebox operators may reach voluntary agreements; preserves the compulsory license as the fall-back to voluntary agreements until something better is put in its place; and leaves open the options of this Committee to review the compulsory license, the fees paid under it, and the means of enforcement, in the future. In this complex situation, Mr. Chairman, you and the co-sponsors of this legislation have worked out the best and wisest course. We appreciate your understanding and believe that the jukebox industry again, with the support of - can continue to bring the best of both American and foreign music to our people. Mr. KASTENMEIER. Thank you, Mr. Bohrer, for that statement. I think all three of you would agree that the Berne Convention is not self-executing, that is to say that by mere adherence, we do not specifically change American law. Would you not agree, Ms. Messinger? Ms. MESSINGER. That is correct. Congressman, I believe you stated the position of all three of us correctly. Mr. KASTENMEIER. There is some ambiguity. Those of us who went to Geneva to discuss this with others interested in the subject found that there is an ambiguity about what the United States might do. There is a preference that the United States might, among other things, get rid of its compulsory licenses or take a step forward on moral rights and so forth. But I think they recognize, really, the difficulty and the bottom line is rather modest in terms of the current state of American copyright law. As a matter of fact, there is such a thing as a mechanical royalty which is a compulsory license. BMI and ASCAP know that and neither you nor we are proposing to alter that one bit; even though I suppose in theory this is an arrangement that is not consistent in principal with Berne. So there is an ambiguity, frankly. I don't know how you propose to live with it one way or the other. In fact, with respect to the self-executing feature, both bills have provisions in them. H.R. 2692, however, also includes a statutory statement which sort of doubly makes that point clear. Do any of you have any objection to that being a procedure which we would follow? It may be a technical bill-writing question which you may not have reviewed. But I am just wondering whether you have any objection to a statutory amendment to Section 104 to the effect that the Berne Convention is not self-executing? Ms. MESSINGER. Not that I can think of, Congressman. I do have two copyright experts here, Bernard Korman, ASCAP's general counsel and Fred Koenigsberg, assistant general counsel. I do not see any objection. If there is a technical problem I will be happy to submit a written statement. Mr. KASTENMEIER. If you wish to qualify that statement, a letter or something to that effect would be quite acceptable. Mr. AHROLD. I just exchanged direct communication with our senior counsel. He also sees no reason why we should not proceed as outlined. Mr. KASTENMEIER. Let me ask you a question in a different area than the jukebox compulsory license, Ms. Messinger. In your prepared statement you say that ASCAP in fact opposes the registration formality as being incompatible with Berne. Section 411 of the Copyright Act requires the copyright owner to register before suing for infringement. In addition to some of the other formalities which, in fact, it has contemplated we remove, we do not propose to remove that but your suggestion is that we do. ASCAP is a very strong user of litigation when necessary. What would be the judicial impact of the proposal to get rid of Section 411, that, requiring registration before suit? Ms. MESSINGER. As you point out, Mr. Chairman, ASCAP is a heavy user of the Copyright Act and is in the courts. Of course we sue under the Copyright Act only after lengthy discussions, letter writing, and efforts to get the users of music to comply with the copyright law. We don't take the procedures available in the courts lightly. We bring many lawsuits, but very few of them get to trial. I think that, if ASCAP files 800 actions a year, perhaps six get to trial. So I trust we are not a burden on the courts. I think you have to look at what the music history and practice has been. I think the practice has been to register music copyrights and I think that would continue to be the practice if, as we urge, Section 411 were repealed. There are many reasons why registration makes sense, and would continue without Section 411. There is great fear of plagiarism. There are the availability of statutory damages and counsel fees under Section 412. There are very important considerations for any copyright plaintiff. So, I do not see the end of registration in the United States if Section 411 were repealed. Foreign works should not be registered because of Section 411. They will be registered because of the requirements of Section 412. That section is compatible with Berne. We think Section 411 should be abolished, and the registration system will prevail without it. Mr. KASTENMEIER. In complying with the present system, has ASCAP found that much difficulty? Ms. MESSINGER. I don't think ASCAP as such has or the music industry has. I think you do have a question of what is appropriate under Berne. I think to some extent you have a question of philosophy. I think you also do have the question of works that are of foreign origin which may suffer because there is this requirement. Under S. 1301, as our statement points out, there is a condition added to 1412 which we suggest should not be included, that is the right to statutory damages if there is not publication within five years. So, I think that is a suggested change that we would offer to the Committee. Mr. KASTENMEIER. Well, as you know, this is a sort of political judgment. It is felt that many, including probably performing rights societies, benefit from a comprehensive registry and if the incentive to registration is removed and the registrations significantly decline, it may be the case that there will be some loss to those who are interested in seeing a comprehensive registry exist nationally. Ms. MESSINGER. I appreciate that concern. I think it may be more in the fear, or perception, than the reality of the situation as it will work out. I think I would respectfully refer the Committee to the position taken by the National Committee on the Berne Convention which is the same as ours. Mr. KASTENMEIER. What are your thoughts on the matter, Mr. Ahrold? Mr. AHROLD. I think, as has just been outlined here, the practical benefits of registration, certainly in BMI, would strongly militate for us to continue the tradition of registration. It is hard for me to imagine that those same practical benefits would not also apply to virtually everybody else who has copyrights at stake. Mr. KASTENMEIER. Thank you. I will now yield to my colleagues. The gentleman from North Carolina, Mr. Čoble. |