rules could be laid down to resolve these issues in a great variety of situations involved. He further pointed out that the proposal would be unworkable in the common situation where a work is the composite product of many employees and that it would be difficult for potential users to know with whom to deal.

In his 1965 Supplementary Report, the Register points out (p. 68) that under section 201(b), the employer and employee could agree to any disposition between them of the exclusive rights under the copyright, but it would not allow them to change the status of a "work made for hire" under the statute. He further says in such regard: "However, if the work is in fact 'prepared by an employee within the scope of his employment' we believe that its status as to third persons should be fixed under the statute and should not depend upon a private agreement between the employer and employee."

Suffice it to say that the House Judiciary Committee gave considerable thought to the above proposal, and rejected the same. Supporting the views previously expressed by the Register, House Report No. 83, says (p. 86):

"After weighing these opposing arguments the committee decided not to substitute a shop right doctrine for the employer-as-author concept of the present law. While the change might theoretically improve the bargaining position of screenwriters and others as a group, the practical benefits that individual authors would receive are highly conjectural. The presumption that initial ownership rights vest in the employer for hire is well established in American copyright law, and the arguments for it are fairly summarized in the Supplementary Report of the Register. To exchange it for the uncertainties of the shop right doctrine would not only be of dubious value to employers and employees alike, but might also reopen a number of other issues and produce dissension."

V. The proposal of the record industry for a public performing right in copy righted sound recordings

Representatives of the Record Industry Association of America have recently appeared before your Committee with proposed amendments for the inclusion of a new species of copyright protection in this revision legislation. On March 16th last, an "intended" amendment to S. 597, along the same lines, was introduced by Senator Williams, and referred to the Committee on the Judiciary.

In essence, the proposal is for a public performing right in a phonorecord fixation of a performing interpretation or rendition of a literary, dramatic or musical work, so that "reasonable" royalties may be collectible therefor, for "equal division" between the copyright owner of such sound fixation and the performers thereof. Such exclusive right and royalties are to be separate and apart from the exclusive rights of and royalties collectible by other interests for the utilization in or by the fixation, of the copyrighted literary, dramatic or musical source materials so interpreted or rendered.

This right, where recognized in the fixation of an interpretation or rendition of another work of authorship, is generally known as one relating to or neighboring upon copyright.

The concept of related or neighboring rights is one that is not merely concerned with recorded sound fixations of interpretations or renditions of various other works of authorship. Its precedental effect raises questions of great impact which cut across the interests of many copyright industries, not only from the point of view of the performers, manufacturers and users of such fixations, but of authors, publishers or other owners or distributors of the copyrightable or copyrighted source materials of which such performing interpretations or renditions are made. Its provisions for “reasonable" royalties, and “equal division” between copyright owner and performers, raise precedental issues.

This proposal for a species of neighboring rights under U.S. statutory copyright has so many ramifications and such potential impact on the economies of various major industries concerned with copyright, that if seriously entertained at this stage, the prospect of general revision would be seriously impaired.

Recognizing this, the Register of Copyrights during the years of preparatory discussion among interested groups and industries did not seriously bring in discussions of the inclusion of such neighboring rights. Neither did the bill drafted by the Copyrght Office, as indicated in the 1965 Report of the Register. As the Register said:

"We are convinced that, under the situation now existing in the United States. the recognition of the right of public performance in sound recordings would

make the general revision so controversial that the chances of its passage would be substantially impaired." (1965 Supplementary Report, pp. 51-52)

The various facets and implications of this question have not been heard, debated, fully explored, considered or rationalized in the intensive study and development of this copyright revision legislation, and in the course of the long Hearings before the House Judiciary Committee. Neither the predecessor bills, nor H.R. 2512, as passed by the House, nor S. 597 now before your Committee, have had any provisions in such regard.

We concur with the above quoted view of the Register.

VI. Suggestions for certain minor modifications

While favorable action was taken by the House Committee on a number of our suggestions for minor modifications or clarifying amendments, not bearing upon the major principles of the legislation, there several unaccepted suggestions we would wish to lay before your Committee. We feel that they have substantial merit, particularly in modernizing ancient procedures outmoded by today's advances in the communication of intelligence.

A. A Federal System for Foreclosure of Copyright Mortgages or Hypothecations We suggest for present consideration, or at least for early study and consideration after this legislation is passed, provision for a federal system for foreclosure of copyright mortgages or hypothecations. These are incorporeal properties, now governed where foreclosure is concerned, by the varying laws of 50 States. These are incorporeal properties for which such State law is illequipped. With orbiting satellites permitting simultaneous performances in virtually all States, differing laws are an anomaly for copyright properties. It is an important matter today where mortgages or hypothecations in connection with a single copyright may at times involve millions of dollars.

B. Elimination Entirely of the Hiatus Period in Respect of Recordation Priority Conflicts

Under present law, an innocent subsequent transferee for value of an exclusive right is not protected against a prior transferee, even though the second transferee records first without knowledge of the prior transfer, as long as the first transferee eventually records within three months (six months if from abroad). This is a hiatus period during which very substantial transfers of rights are in doubt. Payments at times of hundreds of thousands of dollars, if not millions, may be held in abeyance pending the passage of the hiatus period to clarify the situation.

During the hiatus period, there is no protection by recordation, so that reliance, if immediacy is necessary, must be placed on risky representations and warranties that no prior transfers had been made.

This was understandable in 1909 when transportation of the instruments for recordation to the Copyright Office in Washington, D.C. from distant parts of the U.S., or other parts of the world, took a considerable period of time. Transportation facilities from various parts of the world have obviously changed since 1909.

H.R. 4347 reduced the hiatus period to two months (four months if from abroad). The House Committee further reduced it to one month (two months if from abroad). This is how it now appears in H.R. 2512, as passed, and in S. 597. We think the time has come, and urge adopting the real estate rule of "first to record-first to prevail," without any hiatus period.

C. Non-exclusive licenses should be treated the same as exclusive licenses in respect of recordation priority conflicts

There are very important and major long-term licenses of a non-exclusive nature. Why should not the provisions of priority in respect of transfers of cxclusive rights not likewise prevail in respect of non-exclusive licensees. We do not believe this will inundate the Copyright Office with recordations of unimportant small short-term non-exclusive licenses. There will be no practical necessity for recordations in such instances, recordation after all being voluntary. Important long-term non-exclusive licenses should be within the purview of the recording provisions so as to obtain their recordation, and permit reasonable protection to very substantial investments in subsequent exclusive rights not now protected against unknown important prior long-term non-exclusive licenses, whether the latter be recorded or not.

D. Affixation of copyright notice should not be a requirement on copyrighted works published abroad

It was intended in this legislation to ameliorate the rigidity and harshness of our present notice requirements, and much has been done in such regard.

However, the initial requirement in section 401 (a) calls for a notice of copyright whenever a work protected under this copyright law is published in the United States "or elsewhere" by authority of the copyright owner. This requirement for notice on copies published abroad, and particularly among peoples of the world unfamiliar with our use of copyright notice, is even more severe than under our present copyright law. While our present law may require notice on a work first published abroad to initiate copyright, the statute requires notice only on copies thereafter published in the United States. There are other remedial provisions in the statute which will encourage the affixation of copyright notice on copyrights published abroad, but such should not be made a requirement.

We believe that "or elsewhere" should be deleted from line 5 of page 35 of sec. 401(a).

CONCLUSION

May we take this opportunity, as the representatives of our Association did at the Hearings before the House Committee, to express to your Committee our plaudits and appreciation for the very great contribution by our Register of Copyrights, Abraham L. Kaminstein, and his very fine staff, over a period of years, in bringing to Congress and this Hearing stage a genuine bill for copyright revision, and for their many constructive contributions since the 1965 House Hearings. There has been no such comparable detailed and enlightened preparation for legislation in the history of any copyright system, including those of major countries long sophisticated in this field, whose basic systems of automatic copyright protection from creation, for life plus fifty years, under single federal enforcement, we are now considering taking over with some necessary American adaptations.

Respectfully submitted,

THE COPYRIGHT COMMITTEE OF THE MOTION PICTURE ASSOCIATION OF
AMERICA, INC.,

RICHARD B. DAVIS, Chairman.

EDWARD A. SARGOY, Of Counsel.

THE NATIONAL FOOTBALL LEAGUE,
New York, April 10, 1967.

Hon. JOHN L. MCCLELLAN,
New Senate Office Building,
Washington, D.C.

DEAR SENATOR MCCLELLAN : Professional football has not sought the privilege of appearing before the Senate Judiciary Committee to give testimony on S. 597, the copyright revision bill, because of your expressed desire to limit the scope of the hearings. Professional football, however, has a very strong interest in this bill, as indicated by the appearance of both the National Football League and the American Football League before various House and Senate Subcommittees during the last session of Congress.

We therefore respectfully request that this letter be accepted as an expression of our views on the bill and be made part of the hearing record.

The inadequacies of the present copyright laws today confront professional football, and all other professional sports, with serious problems. Professional football creates a type of television entertainment which is of great interest to the viewing public and of very considerable value to the leagues. The revenues from the sale of member club television rights now constitute a major portion of member club income-a source of income which has made possible the present high salary levels in professional football and contributed to the bringing of professional football franchises to an ever growing number of cities.

The games presented to the viewing public on free home television are, however. staged at very considerable expense to the professional football clubs participating in these games. They have every right and, indeed, the practical necessity of protecting their property interests in these telecasts.

The rise of community antenna television systems within the United States has introduced major problems for producers of professional sports programs. Professional football games, for example, are telecast "live", i.c., simultaneously with the game itself. As a result, traditional copyright concepts are of questionable value to sports leagues in protecting their property interests in the telecasts of their games. CATV's do not stand in any contract relationship with either the leagues which produce these games or to the networks or television stations which purchase the television rights of these games. Thus, unless copyright protections are afforded to the producers of these programs. CATV's are free to appropriate them in whatever manner suits their own commercial interests and without regard to the interests of the program producers. With the development of microwave transmission, CATV's, unless restricted, are free to damage the interests of professional football leagues in a wide variety of ways.

In 1961, Congress by statute, 15 U.S.C.A., S. 1291, confirmed the right of professional sports leagues to sell the television rights to their games on a league basis. The networks which purchase these rights pay for and acquire exclusive rights with respect to these games. The value of the rights sold has a definite relationship to this exclusivity and to the right of the network to confer exclusive licenses for these games upon local television stations. Unless copyright protections are afforded to the program producers, these exclusive rights can be transgressed with impunity by CATV's and the value of the television rights sold by a football league can be seriously depreciated.

Other unjustifed interferences with professional football's property interests in its telecasts are now emerging. Professional football seeks to bring its games to the widest possible home television audiences. But it is unwilling to create direct home television conflicts with gate attendance by local telecasts of the same game being played in the same community. This so-called “blackout” practice of professional football (now limited solely to the same game being played in the home territory of a member club) is essential to the protection of ticket sales. As a practice of professional football leagues, it has been approved by a Federal court and affirmed by a Congressional enactment. Yet CATV's, in the absence of copyright limitations, are free to offer home games locally in direct conflict with the game at the stadium and in direct contravention of professional football's "blackout" practice as approved by Congress and the Federal Courts.

CATV operations are damaging to professional sports leagues in still another respect. Professional football leagues, in the interests of the home town supporters of their franchises, impose upon the networks which purchase their games the obligation to carry each away game of each team back to the home city of that team, regardless of where these games are played and the additional costs to the networks of operating these so-called "regional" network structures. Thus, on any particular Sunday afternoon, there will be played and telecast in different regions of the country as many as a dozen different professional football games. CATV's, of course, have no obligation to honor the contract obligations assumed by the purchasing networks and, through the use of microwave facilities, can distort these patterns of "regional” telecasts. Ultimately, this can make it economically impracticable for the networks to accept a contract obligation to televise all away games of all home teams-to the detriment of home town fans throughout the country.

All of the above circumstances have previously been called to the attention of both Senate and House committees. Our position relative to CATV's has, I think been favorably received. The unreasonableness of permitting outside parties directly to damage our property interests with impunity has been acknowledged by committees of both Houses, by the Register of Copyrights, and even by some CATV representatives. Indeed, it is evident from both the legislative history and the language of S. 597 that the bill itself was intended to accord the producers of "live" sports programs the same copyright protections which have been extended by the present bill to the owners of television programs which are telecast from films or tapes.

In two major respects, however, S. 597 fails to accomplish its declared purpose. S. 597, as presently drafted, fails to take into consideration certain unique aspects of the situation confronting sports leagues which telecast their games live. In the first place, S. 597, in the form now pending before this Committee, would appear to accord to the owners of television rights in "live" sports programs a right without a remedy. The sections of the bill dealing with remedies do not take into consideration the fact that it will not be possible for the producers of

such programs to register with the Copyright Office tapes or recordings of such games until after the games have been telecast. As a result, the producers of live sports programs, unlike the producers of motion pictures or the producers of programs which are telecast on a pre-recorded basis, appear to be deprived of access to the remedies of injunction and statutory damage, since registration with the Copyright Office is a precondition to the exercise of such remedies.

In one other major respect, the bill is technically deficient. It seeks to accord to the producers of live sports programs the same copyright protections as are accorded the producers of pretaped, pre-recorded or prefilmed telecasts. In a number of situations, however, copyright protections are made to turn on whether the owner of the program material has granted an exclusive license for the telecast of such material to a local television station located in the same market. But the language of Section 111(b) (6) (A) makes such exclusive license effective for copyright purposes only where the license granted is for the transmission of "the same performance or display of the work" within the particular market. Obviously, with professional football operating with "blackout" patterns (as a device for protecting home gate attendance), and with many different games being simultaneously telecast in many different markets, a local television station will rarely be in a position to receive from the league or the purchasing network an exclusive license for the same game or for the many other games which a local CATV may be in a position to appropriate. Thus, CATV's may continue to interfere, in many situations, with professional football's statutorily protected "blackout" privilege and with the league's Congressionally-approved right to grant exclusivity to a purchasing network—a right which the acquiring network has bargained and paid for.

Both of these basic defects in S. 597 can be remedied without significant changes in the format of the pending bill. Proposed amendments to accomplish this are set forth in the supplemental statement attached to this letter.

On behalf of all member clubs of our new expanded league, now operating with 25 franchises in 24 cities, I respectfully urge that your Committee give the fullest consideration to these necessary amendments and that the Committee act on these amendments favorably.

Sincerely.

PETE ROZELLE, Commissioner.

SUPPLEMENTARY STATEMENT OF COMMISSIONER ROZELLE OF THE NATIONAL AND AMERICAN FOOTBALL LEAGUES

S. 597 purports to extend to the producers of "live" television programs, including sports programs, full copyright protections. But the bill, in its present form, would appear to afford a right without a remedy. Sections 410 and 411 of the bill make registration of the copyright with the Copyright Office a prerequisite to actions for infringement, including actions to enjoin the infringement (Section 502) and actions for award of statutory damages (Section 504). These latter sections do not take into consideration the fact that the producers of "live" sports programs are mechanically incapable of registering tapes of such programs with the Copyright Office prior to the telecast. As a result, the remedies of injunction and statutory damages would not appear to be available to the holders of copyrights in such programs.

In order to provide an injunction remedy to prevent threatened infringements of live telecasts, Section 410 can be amended by inserting "(a) Except as provided in subsection (b)," before the present Section 410, and adding the following as Section 410(b):

"(b) Notwithstanding the provisions of subsection (a), an action for infringement of the copyright in a work consisting of sounds, images, or both, that are being transmitted which is not fixed in a tangible medium of expression before its transmission may be instituted prior to registration of the copyright claim if the defendant in any such action or any predecessor in interest has received notice, prior to the institution of any such action and at least ten days before the transmission of said work, that said work, or a class of works of which said work is a part, will be transmitted and will be registered for copyright in accordance with this title. Registration of said work may be made within three months after its transmission."

In order to provide a right to recover statutory damages and attorney's fees. Section 411 can be amended by inserting “(a) Except as provided in subsection