Ms. RINGER. I would pass on now to chapter XII which involves Federal preemption and duration of copyright.

Let me say, first, Mr. Chairman, that at one time, this was unquestionably the most controversial and debated issue in copyright revision. This has not, however, been true for at least 10 years and probably quite a bit longer than that. I believe that the concept of a single Federal system of copyright is now almost universally accepted. There was no opposition to this concept in your hearings in 1975. The question of duration is still an issue, but I think if it is looked at in perspective, it should not be regarded as major.

I would leave you in no doubt, Mr. Chairman, as to my own feelings on this, which are very strong, and that is that the term of life of the author plus 50 years is the very heart of this revision bill.

Returning to the chapter as I have written it, the provisions I am discussing are summarized briefly on pages 2 through 3, and on pages 4 through 7 I attempt to discuss the present status of section 301, and I return to that now.

The Federal preemption provision in the bill has stayed pretty much the same since the early 1960's. What has happened is the result of a series of decisions by the courts, including the Supreme Court, which have had a sort of roller coaster effect with respect to Federal preemption, but which under the present law, as I think most people interpret it, requires some technical changes in section 301. These were drafted by various members of the copyright bar, and were adopted in the Senate version. The Copyright Office endorses them.

I do not think I need to go into the details of this except on one point, which must be discussed at some length, and this is set out as issue No. 2 in chapter XII of the draft report: should sound recordings fixed before February 15, 1972, be made to an exception to the Federal preemption presented by section 301? Let me read from page 10.

A unique and difficult problem is presented with respect to the status of sound recordings fixed before February 15, 1972, the effective date of the amendment bringing recordings fixed after that date under Federal copyright protection. In its testimony before the House Judiciary Subcommittee on May 8, 1975, the Department of Justice pointed out that under section 301, as then written, "this language could be read as abrogating the antipiracy laws, now existing in 29 States relating to pre-February 15, 1972 sound recordings, on the grounds that these statistics prescribe activities violating rights 'equivalent to * * * the exclusive rights within the general scope of ***." Certainly such a result cannot have been intended for it would likely affect the immedate resurgence of piracy of pre-February 15, 1972 sound recordings.

The Justice Department pointed out this would not apply to recordings after February 15, 1972. Therefore, they recommended that these pre-1972 recordings simply be exempted from the effect of preemption. In other words, left under either Federal, or under State common law or statutory protection. The Senate Judiciary Committee adopted this suggestion and the Senate report which you received this morning states so, on this point. At the present time 32 States prohibit record piracy by statute and far more do so under common law.

The Congress and many States have determined that record pirates unfairly appropriate the property, efforts and capital, of the legitimate music industry. There is no justification for exposing pre-1972 recordings to expropriation by record pirates.

The result of this amendment would be to leave pre-1972 sound recordings as entitled to perpetual protection under State law while post-1972 recordings would eventually fall into the public domain as provided in the bill. The Copyright Office recognizes that under recent court decisions most pre-1972 recordings are protected by State statute and common law and that they should not all be thrown into the public doman instantly upon the coming into effect of the new law. However, we cannot agree that they should, in effect, be accorded perpetual protection as under the Senate amendment.

A possible solution would be to revise clause (4) [the new provision in the bill] to establish a future date for the preemption to take effect. This date perhaps a bit breathtaking-might be February 15, 2047, which is 75 years from the effective date of the statute extending Federal protection to recordings. That sounds like a long time, but I would only point out that it is in comparison to eternity, on the length of term.

I do not make a big point of this. I try to lay out in the first part of the chapter the arguments that have been put forward with respect to lengthening the term, in principle and of the life plus 50 term, in particular. This has been a long-debated issue and is something on which we have very strong feelings. I will read from page 12:

Although the length of the term of copyright, as provided in the bill, was challenged by the Department of Justice, the National Education Association and certain tape duplicators at the 1975 House hearings, no real issue was made of the question of duration. The life-plus-50 term is strongly favored by a wide range of interests and it seems clear that it is accepted by most others. The Copyright Office considers it the foundation of the entire bill.

The last point in this chapter, Mr. Chairman, is not really very important and I would like to skip over it, if I may.

Mr. DANIELSON. Surely. Ms. Ringer, are there any questions? Mr. Drinan.

Mr. DRINAN. Simply on page 8-I am not certain I understand what the new law provides with respect to the renewal of copyrights.

MS. RINGER. The renewal provision is dropped entirely for works coming under the copyright law after the effective date of revision bill. There are provided under chapter 2, and also under chapter 3 to some extent, provisions under which individual authors can recapture their copyrights, by termination of transfers. One element of the present renewal system is preserved in the bill, in a somewhat different form for subsisting copyrights in their first term on the effective date of the new law. The provision uses exactly the same langauge as under the present law, which was preserved because of the fact that there have been enormous amounts of trafficking in contracts for future interests with respect to renewals.

Mr. DRINAN. Are you satisfied with what is stated about renewal in S. 22?

Ms. RINGER. Yes.

Mr. DANIELSON. Mr. Pattison.

Mr. PATTISON. No questions.

Mr. DANIELSON. This is a good point to suspend for a few moments. We have a rollcall vote on an amendment to the tax law, and we are going to have to leave in a minute anyway, so we will recess. I respectfully request that my colleagues come back as soon as possible; perhaps, we can enable Ms. Ringer to conclude her testimony today then,

but we must go now to vote so we will stand in recess for about 10 to 15 minutes.

[A brief recess was taken.]

Mr. KASTENMEIER, (chairman of the subcommittee). The subcommittee will come to order.

I regret to make an announcement-it has to do with procedure on the floor that will make it impossible for us to continue, at least beyond this segment. I do not think other members will be returning.

The procedure adopted is that each of these very important amendments on the tax reform bill will be debated for 10 minutes, and then there will be a formal vote. So I would propose to ask Ms. Ringer to sum up as to where you were before, anticipating, perhaps, 10 minutes or so we will have another vote. We will then conclude for the morning, and we will reconvene on next Thursday, or at such other time that is convenient. If it is necessary to call another meeting it will probably be on next Thursday, probably at 9:30 in the morning. At this time of year we tend to be running into House sessions, unfortunately running concurrently with our own hearing. Should there be a need for another meeting, we can judge that following the conclusion of Ms. Ringer's remarks.

Ms. Ringer?

Ms. RINGER. Mr. Chairman, may I suggest that perhaps I can finish even in 10 to 15 minutes if I skim quite a bit over what I have here. The next chapter is formalities in infringement, and these are mostly technical questions. I have eight issues laid out, and I think that really only two of them need be addressed directly by way of summary. Mr. KASTENMEIER. Had you concluded the discussion of Copyright Royalty Tribunal?

Ms. RINGER. No.

I thought this is the very last major issue I wanted-I think if I can get onto the last chapter, chapter 15, I can cover the fee billyour bill to raise the fees, and other purposes of the Royalty Tribunal very quickly, and perhaps that might be sufficient.

Perhaps it would be simple enough to simply skip over chapter 13 on formalities and infringement, simply noting we would recommend that some improvements be made in the deposit provisions-the provisions for deposit of copies of phonorecords for the Library of Congress, and to note that the Senate has adopted some fairly extensive revisions in the criminal infringement section dealing with seizure and forfeiture, consistent with the Justice Department's testimony on May 8.

Unless you want me to go into anything further in that chapter, I will pass right on to chapter 15, and discuss only the fee bill and the Royalty Tribunal.

I am well aware that the Royalty Tribunal is one of the major issues in the bill. If you would prefer to continue the testimony on that later, Mr. Chairman, I will be entirely at your disposal.

On the fee bill, discussed on pages 4 to 12 of the chapter, I think that I can summarize what I want to say by simply urging this subcommittee, if at all possible, to enact this separate legislation in advance of general revision, as soon as possible.

The bill does three things: It would raise the fees, which have not been raised since 1965, and which presently recover less than 40 percent

of our costs. I might say in that context that, in 1965, when your subcommittee took the initiative to raise the fees the last time, the figure was around 64 percent. So we are falling very badly behind in that regard, and it is getting worse.

Mr. KASTENMEIER. In that connection, are you urged by any other source, such as Office of Management and Budget, or the librarians, or any other source, to bring fees in line with some historic guidelines in terms of fees with respect to services?

Ms. RINGER. Mr. Chairman, all I can say is that the subject is discussed every year at the Appropriations Committees.

Mr. DANIELSON. I would like to ask a question there.

What do you feel, Ms. Ringer, would be this is arbitrary, but where do you suppose would be an equitable place to place the fee?

My feeling is that the fee should pay for the service, but I recognize that there will be situations in which the person seeking the protection for some reason or another ought to receive some aid in connection with it.

Where do you feel it ought to go?

Ms. RINGER. We have always felt that 70 percent was a reasonable figure.

I think what we are proposing will probably bring in a little less than that, but one should consider that the copyright system includes the deposit of valuable copies, as well as actual monetary fees. And while the valuations that are placed on these copies are obviously not exactly what you would get if you went out on the street and tried to sell them, the Library is acquiring them without going out and buying them. So, this is a factor which, if added to the fees received, does bring us to over 100 percent recovery of costs. And I think this creates a situation in which you have some flexibility.

The position we have taken, Mr. Danielson, as you have described, is to avoid placing fees any higher than is reasonably necessary for an effective registration system. They should not constitute a burden on anyone, nor deter those seeking who want to get registration from obtaining it.

This is our position. I think the fees that are in the bill-both in the revision bill as reported by the Senate, and Mr. Kastenmeier's separate bill-are satisfactory for that purpose.

Similarly, the bill would also anticipate two major changes in the registration procedure. It would permit the voluntary registration, of a number of unpublished works which are not registrable under present law, and would also allow some group registrations.

The Author's League, for obvious reasons, has not been very enthusiastic about the fee increase. Nonetheless, it is now seeking just as strongly as we are, to have separate legislation enacted because of the other reform elements that are in this bill, which would be of substantial benefit to individual authors. From a purely bureaucratic point of view, this would enable us to take care of some big procedural changes, well in advance of general revision. We would have them out of the way by the time we had to absorb the major impact of the full revision bill."

Mr. DRINAN. I note, Ms. Ringer, on page 12, that the separate bill is not lying in the Senate. They blanketed these reforms in S. 22. Can we get a separation in the Senate?

57-786-76—pt. 3—34

Ms. RINGER. The assurances I have are purely oral, Mr. Drinan, but I have been told by staff on the Senate Judiciary Committee that, if the House passes the bill, as soon as the revision bill is out of the way in the Senate nothing would stand in the way of Senate acceptance of the separate legislation.

I think the feeling was that they did not want to have this interfering with the ongoing progress of the revision bill at this particular time, but there is no substantive opposition to it.

Mr. DRINAN. Thank you.

MS. RINGER. Let me go on to the Royalty Tribunal, which obviously is an extremely important subject for your subcommittee.

The evolution of the concept of the Royalty Tribunal is traced on pages 12 through 20 of this report, and obviously I cannot go into the details of this. The tribunal is not just somebody's bright idea; it did evolve from a series of events which can be traced progressively. In 1967, your subcommittee reported a bill which did not require a Royalty Tribunal, because there was, I believe, a conscious effort to try to structure the compulsory licenses in the bill so as to avoid this kind of Government activity.

But what the House did on April 11, 1967, by knocking out the cable provisions which had been reported by your committee, and by changing the concept of the jukebox compulsory license, set the scene for something that was almost inevitable: the development of some sort of Royalty Tribunal. Perhaps the simplest thing I can do is skip right to the end, Mr. Chairman, and state what I think might be done with the Royalty Tribunal.

What we are saying is that on the basis of this is on pages 28 through 30-on the basis of the summary of the development of the bill, and what is now facing the tribunal, it is a necessary conclusion that the proliferation of compulsory license systems mandates the establishment of a Royalty Tribunal.

In the aggregate, the duties they seem likely to be called upon to perform are simply too large, complex, and specialized to be handled de novo by Congress and the courts. The Copyright Office believes that if chapter 8 were enacted in its present form, it would probably withstand a direct challenge to its constitutionality.

We now have an exchange of memos between Professor Gellhorn and Professor Pollack. The Gellhorn-Pollack papers, which both deal with the question of constitutionality through in quite different terms do not clearly settle the question of constitutionality or unconstitutionality. However, implicit in both papers is the feeling that you could certainly make the tribunal unequivocally constitutional by certain amendments.

We do suggest several, and they fall under four categories: Administrative structure, standards for determinations, timetables, and judicial review. If I may try to summarize this very briefly, we think that the tribunal should probably have a permanent staff; that it should have continuity and not be as ad hoc as is laid out in the bill at the moment. Turning to the standards, with each compulsory license the Royalty Tribunal has to deal with, there should be specific standards.

This is, I think, one of the most important aspects of resolving any constitutional doubts with respect to the tribunal.