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We do not believe that this would endanger the U.S. GATT obligations, because this constitutes a liberalization on a purely general, nondiscriminatory basis of an existing restriction. We can see no conflict with the general agreement on tariffs and trade, and we highly commend this to you.

Now, finally I would like to comment on the definition of "literary material" or "literary work." Section 601 would apply to "literary material,” “nondramatic literary material," as it is stated. Section 101 of the bill does not define "literary material,” but it does define "literary works.” It defines them as "works expressed in words, numbers, or other verbal or numerical symbols or indicia, regardless of the nature of the material objects, such as books, periodicals, manuscripts, phonorecords, or film, in which they are embodied.” Now we are not so much concerned that the definition is of "literary works" rather than "literary material,” since we believe the terms to be coextensive for practical purposes.

What we are concerned about is the normal implication, not negatived in the present definition of "literary work," that a "literary work" has some special literary value. The present definition says that a work is covered regardless of the nature of the material objects but it does not say regardless of the literary quality or value of the work. What gives us concern is that such articles as catalogs, directories, some composite and encyclopedic works, gazetteers, some periodicals, newspapers, and advertisements may be excluded from the definition of "literary works," as lacking in literary value.

Accordingly, we would recommend that the definition of "literary works” be amended so as to either disavow any criterion of literary value or to list among the typical examples found therein, catalogs, directories, composite, and encyclopedic works, gazetteers, newspapers, and advertisements.

I might say that I think this probably could be done, could be handled, in terms of the legislative history. But we think that it possibly should be done in the language, itself.

I thank you, Mr. Chairman. That concludes my summarization. I certainly appreciate this opportunity being accorded to us.

(Mr. French's full statement follows:)

STATEMENT OF JAMES H. FRENCH My name is James H. French. My address is 1625 K Street NW., Washington, D.C. I am counsel for the Book Manufacturers' Institute.

I wish to discuss briefly some specific recommendations for amendments in H.R. 4347 requested by the BMI.

First, the BMI requests that subparagraph (b)(1) of section 601, which exempts the writings of foreign authors from the manufacturing provision, be rewritten to read as follows:

"(1) where, on the date when importation is sought or public distribution in the United States is made, the author of any substantial part of the main body of the text of any such work is not a citizen of the United States. Votwithstanding any other provision of this title, the employee or other person actually preparing any work made for hire, other than a collective work or compilation, shall for purposes of this subsection be considered the author."

As presently drafted, this provision would invite wholesale evasions of the manufacturing provision by exempting any work in which any substantial part is written by a foreign author. This “any substantial part" could be a foreword, introduction, preface, or comment upon the main body of the work. While we deplore the use for statutory purposes of the vague term “substantial,” the BMI will be content if the exemption is made to apply only where a substantial part of “the main body of the text" is the work of a foreign author.

Also, as proposed, this provision would invite evasion by permitting exemption to be obtained through the use of bogus for-hire contracts between U.S. authors and foreign publishers or foreign subsidiaries of U.S. publishers. Since, under the provisions of proposed section 201 (b) of the bill, the person for whom a work made for hire is prepared is considered the author of the work, proposed section 601 (b) (1) would exempt from the manufacturing provision any work made for hire for a foreign person or corporation. The BMI recommendation would prevent deliberate evasion of the manufacturing provision's requirements by providing that, except in the case of collective works or compilations (as these works are defined in sec. 101 of the bill), the person actually preparing a work made for hire shall, for the purpose of this exemption, be considered the author. The exception for collective works and compilations would assure that the exemption would apply to bona fide joint publishing ventures of collective works and compilations to which American authors contribute.

Finally, the BMI-recommended provision would enlarge the scope of the exemption to cover all foreign authors, even though they be temporarily domiciled in the United States. This exemption would have particular application to foreign scholars publishing works while on teaching fellowships or the like with American universities and colleges. Thus, under the BMI proposal, the exemption would apply to works written by any person not a citizen of the l’nited States.

The next BMI request is that the number of copies exempted from the manufacturing provision for market-testing purposes by subparagraphs (2) and (6) of subsection 601 (b), be reduced from 3,500 to 1,500 or, at the most, 2,000. The reasons for this request have been set forth at length by Mr. Howard in his testimony and I will not take your time now to repeat them.

The BMI requests four changes in the provisions relating to enforcement of the manufacturing provision. These are in section 408 and also in subsection (d) of section 601 of the bill.

First, it is requested that the opening paragraph of subsection 601(d) be amended by inserting on page 33, line 6, after the word "work" and before the comma, the words: "or in any criminal infringement proceedings." This amendment is essential if the enforcement provisions are not to be self-defeating. As presently drafted, subsection (d) would give the so-called infringer a defense against a civil infringement suit if the authorized edition had been manufactured in violation of the manufacturing provision, but it would leave him exposed to criminal infringement proceedings under section 506 of the bill. Under these circumstances, it is plain that enforcement of the manufacturing provision's requirements by private individuals as envisaged by subsection 601 (d) would be totally lacking. No one would subject himself to possible criminal prosecution by bringing out an unauthorized U.S. edition no matter how complete his knowledge that the manufacturing provision had been violated. The BMI recommendation would assure adequate compliance with the manufacturing provision by protecting the publisher of the unauthorized U.S. edition of a work manufactured in violation thereof against criminal prosecution.

Second, it is requested that, on page 33, line 11, after the word "States" and before the semicolon, the words "in accordance with the provisions of subsection (c)” be inserted. The purpose of this requested amendment obviously is to assure that no more stringent requirement as to U.S. manufacture may be applied against the “enforcer” of the manufacturing provision than apply in the first instance to the copyright owner. Without this change, the unqualified requirement that the infringing copies be manufactured in the United States could well be interpreted by a court of law to be broader than the basic requirement that the authorized copies be manufactured in the United States in accordance with subsection 601 (c). The BMI proposal would preclude this highly undesirable eventuality by expressly making the test of U.S. manufacture the same, both for the authorized, and the unauthorized, copies.

The third and fourth changes requested by the BMI in the enforcement provisions are both designed to alleviate the practically impossible burden of proving violation of the manufacturing provision which otherwise will fall upon the producer of the unauthorized U.S. edition and, thus, to assure compliance with the manufacturing provision's requirements. Subparagraph (d) (1) requires that in order to have a defense, the so-called infringer will have to be able to prove that copies of the work have been imported into or publicly distributed in the United States in violation of the manufacturing provision. The underlying facts upon which such proof must be based are facts which normally are peculiarly within the knowledge of the copyright owner. Without some requirement of advance disclosure, therefore, copyright owners could violate the manufacturing provision with impunity. Accordingly, the BMI requests the following two amendments :

In section 408 of the bill, which prescribes the information to be supplied on applications for registration of copyright, renumber clause (10) as clause (11) and insert the following new clause (10):

"(10) In the case of a published work consisting preponderantly of nondramatic literary material that is in the English language, the names and addresses of the firms or persons performing the manufacturing of the copies required by subsection (c) of section 601 of this title to be performed in the United States and the work performed by each such firm or person. However, if a copyright application has been filed prior to publication of such work no additional application shall be required to be filed for the purpose of compliance with this clause."

Then at the end of subsection (d) of section 601, insert the following paragraph :

"In any such action with respect to a work as to which the application for copyright registration did not include the information required by clause (10) of section 408, the copyright owner shall set forth such information in the complaint."

Under the language proposed in these two amendments, the copyright owner would be required to state on the application for copyright registration the names and addresses of the firms manufacturing the work. While an apparent violation of the manufacturing provision's requirements appearing on a registration application would not constitute grounds for denial of registration (and would impose no special administrative or quasi-judicial burden on the Copyright Office), the information required to be disclosed would be available for public inspection and would therefore constitute a major deterrent to violation of the manufacturing provision.

The requirement that the same information be disclosed in the complaint in an infringement suit if it was not disclosed in the copyright registration application (where the work was unpublished at the time of registration) constitutes notice to a would-be violator of the manufacturing provision that full disclosure will sooner or later be required. Thus, together these two amendments would go a long way toward assuring compliance with the new manufacturing provision and would greatly reduce the likelihood of litigation. We believe that these two proposed amendments, designed to assure compliance, are especially necessary since the powerful deterrent of potential loss of copy. right existing in the present law has been removed from the new manufacturing provision.

The next amendment, which has already been referred to by Mr. Howard, would authorize the President to waive the application of the manufacturing provision with respect to copies manufactured in any foreign country as to which it is found after investigation and hearing that the cost of manufacturing books does not differ significantly from the cost of manufacturing comparable books in the United States. This would be accomplished by inserting after subsection (d) of section 601, the following new subsection :

(e) Notwithstandir any other provision of this section, copies of any work may be imported and publicly distributed in the United States without limitation where such copies have been wholly manufactured in a foreign state or nation (or partly in such a foreign state or nation and partly in the United States) which is found and designated by the President to be a foreign state or nation in which the cost of manufacturing completed copies of nondramatic literary works of qualities, types, and sizes comparable to the qualities, types,

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and sizes in most general current use in the United States, in a quantity to be determined as the approximate average press run then current in the l'nited States, does not differ significantly from such cost in the United States. No such finding or designation shall be made except after investigation, during the course of which any interested person or organization shall be afforded the opportunity, after reasonable notice, to appear and present testimony at a public hearing, and upon publication in the Federal Register of the facts upon which such finding and designation are based and the reasons therefor."

As was pointed out by Mr. Howard, it is the belief and desire of the BMI that this provision would result in the early removal of the manufacturing provision's requirements insofar as they affect books manufactured in Canada. We note that this result has been endorsed in principle by the printing trades unions, and we do not believe that it is specifically objected to by U.S. publishers. Since this provision would have general and nondiscriminatory application to all countries and constitutes a liberalization of an existing restriction, we do not believe that it would place the United States in contravention of the provisions of the General Agreement on Tariffs and Trade. While the proposed provision would not expressly require reciprocal treatment by a foreign country, it is implicit that such reciprocity should be accorded, and it would be expected that the U.S. Government would use whatever means are at its command to assure that a country being accorded exemption from our manufacturing provi. sion does not discriminate or impose undue restrictions upon imports of U.S. printed matter. The BMI strongly urges adoption of this amendment.

Finally, it is noted that section 601 would apply to "nondramatic literary material." Section 101 of the bill does not define "literary material" as such but defines "literary works" as "works expressed in words, numbers, or other verbal or numerical symbols or indicia, regardless of the nature of the material objects, such as books, periodicals, manuscripts, phonorecords, or film, in which they are embodied." We are not so much concerned that the definition is of "literary works" instead of "literary materialsince we believe the two terms to be coextensive for all practical purposes.

What we are concerned about is the normal implication, not negatived in the present definition of literary works, that a "literary work" has some special literary value. The present definition says that a work is covered "regardless of the nature of the material objects,” but it does not say “regardless of the literary quality or value of the work." What gives us concern is that such articles as catalogs, directories, some composite and encyclopedic works, gazetteers, some periodicals, newspapers, and advertisements may be excluded from the definition of “literary works" as lacking in literary value.

Accordingly, we would recommend that the definition of "literary works” be amended so as either to disavow any criterion of literary value or to list among the typical examples found therein, catalogs, directories, composite and encyclopedic works, gazetteers, newspapers, and advertisements.

Mr. KASTEN MEIER. Thank you, Mr. French and Mr. Howard, for very complete, thorough, concise testimony.

Mr. St. Onge?
Mr. Sr. Onge. No questions, Mr. Chairman.
Mr. KASTENMEIER. Mr. Poff ?

Mr. Poff. Mr. French, would you explain in more detail why you feel the word "domiciliary" should be omitted from section 601(b) (1) ? I believe you had reference to foreign scholars temporarily residing in this country.

Mr. French. Yes, Mr. Poff. We feel that in the first place the manufacturing provision as it now exists and as it is proposed to exist really applies to works of American authors. It applies to works which will supply the American reading market. We feel, just as we said with respect to particular scientific and technical works, we feel that works by foreign authors temporarily residing in the United States are, in the first place, works which would have

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a very limited distribution in the United States. They are normally within the sphere of your scientific and technical works.

There have been some assertions, quite frankly, by British interests that the manufacturing clause is discriminatory against foreign authors who may be residing in the United States. While we place little stock in that, we feel that if there is any feeling which could result in some foreign scholar or professor not accepting a teaching fellowship to an American university, to lecture in German, or what have you, if there is a possibility of removing that possibility without injuring domestic manufacturers seriously, we certainly want to try to do it.

That is the purpose of that.

Mr. Poff. In the language which you have suggested as a substitute for 601 (b) (1) you have confined the exemption to the case in which the author is the creator of a substantial part of the main body of the text.

Mr. FRENCH. Yes.

Mr. Poff. You mean to exclude from the exemption people who write forewords or other explanatory material by way of preface?

Mr. FRENCH. That is correct. A bona fide case we would not want to exclude, but we fear that if it is not made to apply to the main body of the text it will simply be an invitation to employ a foreign author, perhaps a man of note, to simply write a foreword or something in a book by an American author in order to obtain the exemption and have the book manufactured abroad.

Mr. Poff. Let me see if I understand the point you make about what you call “bogus contacts for hire.” Section 201(b) of the bill defines works made for hire in such a way that the employer is the author. If you use that definition of author, therefore, section 601 (b) would make it possible for a person who wanted to circumvent the manufacturing clause to have a fictitious employer on foreign soil "employing"--and I use that word in quotation—the author who prepared the text, and by that device enjoy the exemption unless the amendment you propose is made. Is that correct?

Mr. FRENCHI. That is correct.
Mr. POFF. Thank you. That is all I care to ask, Mr. Chairman.
Mr. KASTEN MEIER." Thank you both for your testimony today.
Mr. FRENCH. Thank

you,

Mr. Chairman. Mr. KASTENMEIER. This concludes the hearings for this morning. Hearings will continue next week on Wednesday and Thursday. Then the committee will hear Mr. Schulman, the National Association of Broadcasters, the Graphic Arts Industries Association, the Canadian Copyright Institute: on Thursday, the Music Publishers Protective Association, the Authors League of America, and the ad hoc committee.

Accordingly, this subcommittee stands adjourned until 10 a.m. on Wednesday, next.

(Whereupon, at 12:40 p.m., the committee recessed, to reconvene at 10 a.m., Wednesday, August 18, 1965.)

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