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bert v. Shanley Co. 242 U.S. 591 (1916), that the restaurant was selling food only and not the privilege of hearing Victor Herbert's "Sweethearts." However the argument by the cable television people may be less persuasive than it was in that case, for Shanley's gave its patrons food (which, unlike a wire connection or an antenna, has an independent value) in addition to the copyright material which the establishment had performed for the edification of its patrons. The court in that case held that the restaurant was selling a combination of the food and the privilege of hearing a performance of Herbert's music. In my judgment, a subscriber to a CATV system pays for the privilege of connecting his set to a cable only for purposes of receiving a program service. The CATV operator is more directly engaged than the broadcaster in profiting from the use of copyright materials since as pointed out above, he charges his subscribers for his transmission and their reception of those materials whereas the broadcaster is “selling" or trying to sell the right to advertise their wares to businessmen in time periods within or close to the copyright material which is broadcast.
The CATV systems have proliferated at an amazing rate; many are prosperous and many perform a socially useful function but no other industry using such material, it seems to us, makes a more direct charge to its customers for the privilege of seeing and hearing copyright works.
The fact that many broadcasters have gone into the CATV business does not, of course, alter these conclusions. ABC, along with certain other broadcasters believes that there is an important supplementary role for CATV in the overall television scheme and for some time has been investigating possible entry into the CATV business. When and if we do enter it, our company has stated that any cable system which we construct or acquire would be operated in accordance with the applicable Federal Communications Commission policies. As part of the CATV industry we should be receptive to working out appropriate arrangements with the copyright proprietors and their representatives.
The bill proposes to recognize the right of a broadcasting organization to make no more than one copy or phonorecord of a copyrighted work for use solely in its own lawful transmissions within a period of 6 months. The motion picture people, perhaps among others, have objected to the ephemeral recordings provision in the bill, the picture industry people on the ground that unauthorized prints of their pictures could be made by broadcasters and the prints might find their way into the marketplace.
ABC suggested to the Register of Copyrights in March of this year substitute language for section 110 which would result in the ephemeral recording right being confined on the one hand to nondramatic, literary, or musical copyrighted works and enlarged on the other hand to allow the making of more than one copy or phonorecord. The Register in his supplementary report of May 1965 (p. 46) noted that the limitation “to make no more than one copy or phonorecord of the work” which appears in the present proposed section 110 has been criticized on behalf of broadcasters as being “unduly restrictive if it means that, in the case of a hit song for example, a broadcaster is not permitted to include the work in separate recordings of different programs. While the language of section 110 should probably be clarified on this point, the intention was to permit a single recording of any one program, even though it included a work that was also part of another recorded program."
We believe that ABC's suggestion to the Register should be substituted for the present language in section 110. Doing so might set at rest the fears of the motion picture people and would take care of the needed clarification pointed out by the Register. A copy of that suggested language follows: “8 110. Limitations on exclusive rights: Ephemeral recordings
"Notwithstanding the provisions of section 106, it is not an infringement of copyright for an organization entitled under this Act to transmit a performance or exhibition of a nondramatic literary or musical copyrighted work to the public to make copies or phonorecords of the work solely for purposes of the organization's own authorized transmissions or for archival preservation, if the copies or phonorecords are not used for transmission after the period of six months from the date they were first made, and are thereafter destroyed or preserved for archival purposes only."
AMERICAN HOTEL & MOTEL ASSOCIATION,
Washington, D.C., June 4, 1965. Mr. HERBERT FUCHS, Counsel, House Committee on the Judiciary, Rayburn House Office Building,
Washington, D.C. DEAR MR. FUCHS: Enclosed is a copy of the statement of the American Hotel & Motel Association relative to H.R. 4347.
It is requested that the statement be made a part of the record of the subcommittee's hearings on this legislation. Sincerely,
LEONARD K. DOWIAK.
STATEMENT OF THE AMERICAN HOTEL & MOTEL ASSOCIATION The American Hotel & Motel Association is a federation of State associations having a membership in excess of 6,000 hotels and motels located in all sections of the country. The association maintains offices at 221 West 57th Street, New York City, and at 777 14th Street NW., Washington, D.C. We appreciate har. ing the opportunity to register, with this subcommittee, A.H. & M.A.'s views on H.R. 4347, a bill to revise the copyright law. Section 109
Section 109 of H.R. 4347 states in part that, notwithstanding the language of the "exclusive rights in copyright works" section of the bill (sec. 106), the fol. lowing are not infringements of copyright:
“(6) the further transmitting of a transmission embodying a performance or exhibition of a work by relaying it to the private rooms of a hotel or other public establishment through a system of loudspeakers or other devices in such rooms, unless the person responsible for relaying the transmission or the operator of the establishment:
“(A) alters or adds to the content of the transmission; or
“(B) makes a separate charge to the occupants of the private rooms directly to see or hear the transmission;
“(7) communication of a transmission embodying a performance or erhibition of a work by the public reception of the transmission on a single receiving apparatus of a kind commonly used in private homes, unless :
“(A) a direct charge is made to see or hear the transmissions; or
“(B) the transmission thus received is further transmitted to the public." There is contained in the Report of the Register of Copyrights on the General Revision of the Copyright Law, dated July 1961, the recommendation that "the statute should exempt the mere reception of broadcasts from the public performance right, except where the receiver makes a charge to the public for such reception." The American Hotel & Motel Association endorses this recommendation and agrees with the general thrust of section 109 of H.R. 4347.
It is now established practice that the use of copyrighted music in network broadcasts is "cleared at the source," i.e., the license to perform the music is obtained by the network broadcaster and no further license is required of local stations for their retransmission of the broadcast. As does the Register of Copyrights, "we believe this principle of clearance at the source should apply to the reception of broadcasts."
Since the decision in Buck v. Jewell-LaSalle Realty Company (232 U.S. 191 (1931)), performing licenses are required for all copyrighted musical works where there is a reception of broadcasts in the public rooms of a hotel. In addition, the courts have gone even further. In the case of SESAC v. Statler (19 F. Supp. 1 (D.C.N.Y., 1937)), the Court upheld the right to collect royalties when the radio broadcast was being received in the private rooms of a hotel. Since the Buck decision, all of the performing rights societies have demanded the payment of royalties for radio and television reception of copyrighted music in public rooms but to our knowledge only one of the societies has made claim for such reception in private rooms on the basis of the Statler case. The valid ity of the decision in the Statler case is extremely dubious because we do not believe that the reception of a broadcast by an individual hotel guest in his own room is a “public performance” as that term is used in the copyright law.
Whatever the law may be as to these radio and television broadcasts, it is both impractical and inequitable as it applies to proprietors of hotels. The slightest intervention of copyrighted music, however incidental, in a news or dramatic program received by television or radio in a public room of a hotel makes a proprietor liable for infringement of a copyright unless he has a performing license. In addition, the confusion created by the Statler decision should be eliminated. This appears to be the general thrust of section 109 of H.R. 4347 which appears to recognize that composers and publishers are amply compensated by "clearance at the source" for radio and television broadcasts of their music.
Section 109 does, however, leave one important consideration unanswered.
Subsection (6) begins with the phrase: "The further transmitting of a transmission." We interpret this phrase and the following remainder of the subsection as limiting the exemption to reception in the private rooms of a hotel or other public establishment where such reception is over a master system of some sort, e.g., a master transmitter with related multiple-speaker outlets. We support the exemption to this point, but it is unclear as to whether the exemption is to further apply, as we feel should be the case, where there is reception of a transmission in private rooms of a hotel or other public establishment on the single receiving apparatus of a kind commonly used in private homes.
Subsection (7) of section 109 does not answer the question in that it refers to “public” reception and seemingly does not extend its exemption to reception in “private” rooms.
If the bill is intended to exempt all radio and television reception in the private hotel room with the enumerated two exceptions as we feel is the intent and as we suggest above there then appears to be no necessity of section 109 (6) referring to the “further transmitting, etc. * * *." The construction and suggestion we advance do appear to convey the sections intent. Where the section exempts such reception in private rooms of a hotel where there is retransmission over a master system, i.e., section 109 (6), it is difficult to foresee it not necessarily including an exemption for reception in private rooms on a single receiving apparatus.
In this regard it is suggested that section 109 (7) be amended to insert between the words “transmission” and “on” in lines 30 and 31 of page 8 of H.R. 4347 the following language: "or the reception in the private rooms of a hotel or other public establishment." Section 114
Section 114 of H.R. 4347 proposes to repeal that portion of the present law known as the “jukebox exemption." Section 1(e) of the present law provides, in part :
“The reproduction or rendition of a musical composition by or upon coinoperated machines shall not be deemed a public performance for profit unless a fee is charged for admission to the place where such reproduction or rendition occurs."
In effect, this section exempts, with certain exceptions, the operators of jukeboxes from any obligation to pay royalties for the performance of musical works on coin-operated machines.
It is the position of the American Hotel & Motel Association that the present “jukebox exemption” should not be repealed but should remain in the law unchanged.
In the aforementioned report of the Register of Copyrights repeal of the exemption is recommended, in part, because “the public pays for the performance." The statement implies that the performance is "public" within the letter of the statute. The implication is directly contrary to the present section 1(e) which states, as a matter of law, that such a performance is not public "unless a fee is charged for admission to the place * * *.” And as have the opponents of repeal of the exemption so aptly argued in the past, the jukebox rendition of music is, in fact, a personal, private performance, not a public performance.
Repeal is sought by the performing rights societies, for the copyright owners, on the grounds that the exemption improperly withholds royalties due and owing the copyright owners. If the copyright owners are thought to be entitled to greater compensation for the use of their music, this should be accomplished through increased “mechanical” royalties. Such a solution is preferable to that proposed in that the rate of royalty would be fixed in the statute. In addition, the method of collection for such mechanical royalties is now already established in the Copyright Act. As was stated in the minority report accompanying H.R. 7194 (similar legislation introduced in the 88th Cong.):
"The mechanical fee is fairest to all concerned. The royalties thus generated are directly related to the popularity of the particular composer's music, and the royalties paid by an operator likewise are directly proportional to the demand for that composer's record on the part of the operator's customers."
Section 114 as it is now written is also objectionable in that it would place undue pressure and responsibility on the "operators” of such machines. Subsection (2) of the aforementioned section permits each copyright owner to re quire of the owner of an establishment in which a coin-operated machine is located information as to the ownership of the machine. If the owner of the establishment does not answer promptly, he subjects himself to a multiplicity of lawsuits. Should a coin-operated machine contain 250 recordings, there could be instituted a lawsuit for each copyright owner regardless of the damages incurred.
In passing on the matter of the "Jukebox exemption," the subcommittee would be well advised to consider the possible impact of such a repeal. The exemption serves as a basis for an entire industry. Repeal of the exemption could seriously cripple or destroy an industry employing thousands of people.
Should the subcommittee, however, in its wisdom recommend repeal of the jukebox exemption, there should be considered the fact that there are other types of coin-operated machines aside from jukeboxes. Coin-operated radio and tele vision sets are used in many establishments. If section 109 of H.R. 4347 is intended to exempt the reception of radio and television broadcasts in publie rooms from the payment of copyright royalties, there is no reason why the exemp tion should be denied because the radio or television set is coin operated. As presently written, section 109(7) is not broad enough to include coin-operated machines but is limited to a "single receiving apparatus of a kind commonly used in private homes." We do not believe that coin-operated machines are commonly used in private homes. For that reason, if Congress wishes to repeal the “jukebox exemption," it should limit its action to "jukeboxes.” This can be accomplished by adding a third subdivision to section 114, reading as follows:
“(3) and the machine is a device for the playing of recorded music originating in the establishments.”
AMERICAN MUSICOLOGICAL SOCIETY,
September 29, 1965. Mr. HERBERT FUCHS, Counsel, House Judiciary Committee, Subcommittee No. 3, Cannon Ofice Build
ing, Washington, D.O. DEAR MR. FUCH8: The American Musicological Society, through its members, comprising 2,000 scholars, authors, teachers, librarians, and composers, has a continuing and vital interest in H.R. 4347, a bill for the general revision of the copyright law.
As president of the society, I have studied the bill and the publication entitled "Copyright Law Revision, Part 6, May 1965," printed for the use of the House Committee on the Judiciary. In addition I have read excerpts from the testimony of various witnesses, especially those representing an ad hoc Committee of Educational Associations, and have, further, discussed various aspects of the bill with fellow members of the American Musicological Society.
Most recently I have asked the members of the executive board, elected by the members of the society, to express their opinions regarding section 107 : Limitations on exclusive rights: Fair use. The replies were unanimous in supporting the retention of this section as it stands, namely: "Notwithstanding the provisions of section 106, the fair use of a copyrighted work is not an infringement of copyright."
As expressed so succinctly in "Copyright Law Revision, Part 6,” the executive board of the American Musicological Society does “not favor sweeping, acrossthe-board exemptions from the author's exclusive rights * * *.” For us, the difference between "fair use" and "free use" is a critical one: "Fair use" leaves to author and publisher the right to take proper action toward the correction or removal of abusive practices; “Free use" imposes restrictive limitations. Because the principal, if not the sole, publishing reward of authors like us derives from royalties on sales to educational institutions, we are particularly desirous of exercising control over this as well as other sources of income. Without the assurance of such control the incentive to produce textbooks and scholarly works would be much reduced and might ultimately disappear. It seems clear to us that if we, as authors, contribute time, energy, and often arduous research to the preparation of educational materials, we should not be required addi. tionally to contribute any part of the income that might derive from the sales of our works.
In brief, we stand opposed to the several modifications of section 107 that have been proposed by the ad hoc Committee of Educational Associations.
In addition to the position taken by the executive board on section 107, it should be noted that we endorse sections 303 and 304, particularly in the ways in which these sections eliminate the dual system whereby something protected by common law if unpublished is protected by copyright law if published.
On behalf of the executive board of the American Musicological Society and those other members of the society, listed below, who have advised me, I request that this letter be entered in the records of proceedings related to H.R. 4347. Respectfully submitted.
WILLIAM J. MITCHELL,' President.
Executive board members whose views are represented herein:
Past members of the executive board whose views are represented herein:
bia University, New York, N.Y.
THE ASSOCIATED PUBLISHERS, INC.,
Washington, D.O., June 28, 1965. HOUSE JUDICIARY COMMITTEE, Subcommittee No. 3, Subcommittee on Copyrights, House of Representatives, Washington, D.C.
DEAR SIBS: The Associated Publishers, Inc., respectfully urges the Subcommittee on Copyrights, in its work of updating the copyright law of 1909 to give adequate protection to publishers of educational materials. We urge that the principle of "fair use" be followed—a principle that will permit the use of selected quotations and excerpts and their reproduction, while at the same time safeguarding the copyright of the publishers. Without such a safeguard, a copyright might mean little.
Moreover the lack of adequate copyright protection would be especially harmful to non-profit-making publishers, such as the Associated Publishers, a subsidiary of the Association for the Study of Negro Life and History. If our materials were subject to copious reproduction without our consent and permission, our single-minded goal of better informing the public, of diffusing knowledge, might well be seriously attenuated.
It should be added that we of the Associated Publishers are fully cooperative in granting requests for the reproduction of our materials, levying no charge for such permission to reprint. We are most anxious to have others know of our materials and to make use of them-hence as a matter of policy we grant reprint permission.
1 Columbia University.