"In the four-year period 1960-63, textbook sales mounted from approximately $15,071,000 to $25,417,000, a gain of 69 per cent. Of this total, high school and elementary textbooks went from $8,256,000 to $14,485,000, a gain of 75 per cent. College textbook sales increased from $6,815,000 in 1960 to $10,932,000, a growth of 60 per cent." (p. 3)

"The School Department publishes elementary and high school textbooks, workbooks and programmed and other instructional materials. Establishing a new sales record of $14,485,000 in 1963, the department increased its volume by 25 per cent over the $11,592,000 recorded in 1962." (p. 10)

3. Hirsch & Co.'s Research and Advisory Department issued "A Review of Business and Financial Conditions" on textbook publishers, dated May 1965, which states the following:

"In 1963, . . . total retail sales of textbooks and standard tests amounted to $475 million as compared to $173 million in 1953. This represents a cumulative annual growth of 10.7%.

"The textbook industry

...

should enjoy an annual rate of growth of 10% to 12% for the next five years at least, with the college sector expanding even faster. Further, the industry's growth should be sustained even in any downtrend in the business cycle." (p. 2)

4. Standard & Poor's The Outlook, for June 28, 1965, in an article "Outlook Booming for Textbooks," reports:

"The textbook publishing industry, already growing at about 10% a year, will be boosted by sharply rising Government expenditures in the field of education. Industry sales reached a record $509 million last year, more than double the 1957 total, the gains stemming from both increasing enrollments and higher textbook expenditures per student ." (p. 741)

5. The New York Times for July 18, 1965, in a column captioned "Bookpublishing: a Growth Theme," reports:

"Educational publishing has been dubbed by some observers as 'the biggest growth industry of them all.'" (p. 11, col. 4)

6. The Xerox Corporation is reported to have purchased an educational publisher for a reputed cost of $56 million. Obviously Xerox does not expect its copying machines to destroy the profit on its $56 million investment.

Please note, the Ad Hoc Committee is delighted the publishers are showing profits and hope and expect they will continue to do so. Our only point in bringing these facts to this committee's attention is to show that publishers are prospering and that they expect to prosper even more despite all the copying that is now going on in schools. Teachers' copying of copyrighed works has not, and is not expected to. hurt publishers economically.

Second, two recent and impartial U.S. Government-sponsored studies conclude that there is no harmful economic impact of photocopying on publishers and authors. A National Science Foundation-sponsored study of scientific and technical photoduplication thus describes why it was undertaken :

66

those who are concerned with the photoduplication problem admit that factual data on the extent of the threat are lacking. It was the realization that such facts are lacking that led the National Science Foundation to commission this study.'

99 27

Its conclusions include the following:

"The basic conclusion of this report is that at the present time, no significant damage occurs to copyright holders in the scientific and technical fields although duplication of this material is widespread and is growing rapidly." (p. I) "Because this report concludes that economic damage to copyright holders is not significant, it must also be a conclusion, from a non-legal standpoint, that a control of the ASCAP type is not required at this time (p. VI-9) The Air Force Office of Scientific Research-financed study on scholarly publications 28 summarizes its conclusion as follows:

"The extension of photcopying has led some publishers to fear that it may take over the market for publications of monographic scholarly material. However, the evidence presented in this study indicates that the reproduction of these materials by photocopying has not affected, nor is it likely to affect, the production of scholarly material in book form." (p. 71)

27 See note 24, supra, at p. IV-3.

28 Clarke, R. F., The Impact of Photocopying on Scholarly Publishing, 1963 (a Ph. D. thesis at Rutgers University).

And its first recommendation is:

"Claims that photocopying has a damaging effect upon publishing are not substantiated by evidence and should be disregarded." (p. 77)

Third, there is reliable, objective evidence of resultant advantage to publishers and authors from such photocopying:

(1) The National Science Foundation-sponsored study found that 55.8% of the authors "stated it was a definite advantage." (p. III-3)

(2) The Air Force-financed study found: "Photcopying particular journals over a period of time can lead to subscribing to those journals." (p. 77)

(3) And the Chicago Tribune of August 18, 1964, p. 24, in an editorial specifically referring to remarks by Dr. Harold E. Wigren, Chairman of the Ad Hoc Committee, said:

66

permitting educational, not-for-profit circulation of an author's writings might serve the writer better than an iron-clad prohibition of such circulation without written permission. After all, an author's rights do not amount to much if no one wants to read what he has written-if no one has ever heard of him. Perhaps the school mimeograph should be viewed not as a piratical rival to the trade publisher but as a helpful unpaid publicity agent who helps publisher's long-term sales."

We respectfully suggest that (1) there is no merit to the economic arguments advanced against the Ad Hoc Committee's proposal, and that (2) the adoption of the Ad Hoc Committee's proposal is in the paramount public interest.

II. AMENDMENT OF "FAIR USE" PROVISION

Under present law "fair use" is a wholly judicial doctrine and is not even mentioned in the present copyright statute. The only effect of § 107 of S. 1006 is to make such mention, "without any attempt to indicate the application or define the scope of the doctrine." 20

The Register's earlier bill, H.R. 11947, 88th Cong., 2nd Sess., § 6 (first sentence) included a provision which was more meaningful and which was far more satisfactory to education. The Ad Hoc Committee therefore urges restoration of that sentence in § 107 so that "teaching, scholarship, or research" are specifically mentioned as being legitimate purposes of "fair use."

In addition, the Ad Hoc Committee urges that the burden of proof in instances of educational "fair use" be transferred to the copyright owner since in the overwhelming proportion of the cases the copyright owner, rather than the teacher, alone will have the evidence required under the criteria applied by the courts to determine "fair use."

Thus, while the Ad Hoc Committee agrees with the Register on including "fair use" in the statute, we believe that § 107 should be amended to read as follows: "Notwithstanding the provisions of section 106, the fair use of a copyrighted work to the extent reasonably necessary or incidental to a legitimate purpose such as criticism, comment, news reporting, teaching, scholarship, or research is not an infringement of copyright. Noncommercial educational use by a nonprofit educational institution or organization shall be presumed to be such ‘fair use' unless specifically rebutted."

III. DISCRETIONARY WAIVER OF STATUTORY DAMAGES FOR INNOCENT INFRINGEMENT BY TEACHERS

Under present law, innocent and harmless infringement is subject to mandatory minimum statutory damages of $250.00. S. 1006 takes an important forward step in § 504 (c) (2), second sentence, by recognizing that in cases of innocent infringement the Court may, in its discretion, reduce the award to "a sum of not less than $100." We commend the Register for this provision.

However, for a teacher damages of $100 is as serious a deterrent to using any copyrighted material as the present $250 minimum. This is all the more true since, unlike a commercial employer, a School Board may not be held liable respondent superior and may not be able to reimburse the teacher for such $100 judgment relating to work done in his official teaching capacity. See Wihtol v. Crow, 309 F. 2d 777, 782 (8th Cir. 1962). Therefore, the Ad Hoc Committee recommends that § 504 (c) (2) be amended by adding the following sentence at the end of the present line 19 on page 30, as follows:

"In a case where the infringer proves that the infringing use was for bona fide nonprofit educational purposes and made in reasonable belief that such

29 Goldman, op. cit., supra, note 4, at 1269.

a use was not an infringement of copyright, the court may in its discretion, withhold any award of statutory damages under this subsection or may reduce the amount to a sum less than $100."

This recommendation is in conformity with the Register's 1961 Report where he advances the "proposal that the minimum not be mandatory against innocent infringers" (p. 106). Horace S. Manges, Esq., Counsel to the American Book Publishers Council, has expressed agreement with the proposal by the Register that "as to innocent infringers, the court should be permitted to withhold all statutory damages or to award less than the minimum." 30

We respectfully urge this Committee to adopt the proposed amendment submitted by the Ad Hoc Committee.

IV. DURATION OF COPYRIGHT TERM

Since our first copyright law in 1790, a renewable term has been the characteristic hallmark of American copyright law. The present law provides for an initial period of 28 years copyright, renewable for a similar period of 28 years after which the work goes into the public domain.

S. 1006 would work radical surgery on this tested and unique American policy by adopting a copyright period measured by the life of the author plus 50 years.

The Ad Hoc Committee urges retention of the present renewal provision of law a 28-year initial term of copyright plus a 28-year renewal period. As an alternative we favor the Register's proposal in his 1961 Report: initial 28-year term plus a 48-year renewal term, totaling 76 years (instead of the present 56). Education accepts the rationale of the Register's 1961 Report, as follows: "We do not believe that the maximum term of copyright-which we are proposing be 76 years from first public dissemination-is necessary or advisable for all works. Experience indicates that the present initial term of 28 years is sufficient for the great majority of copyrighted works: less than 15 percent of all registered copyrights are being renewed at the present time.

"The percentage of renewals varies from one class of works to another. During a recent year, for example, renewals ranged from 70 percent of the eligible motion pictures, down through 35 percent for music, 11 percent for periodicals, 7 percent for 'books' (which includes text material published in various forms) to less than 1 percent for technical drawings.'

99 31

Section 24 of the present law provides an initial 28-year period, which enables teachers and students to use the non-renewed 85% of all registered copyrights from the 29th year, because the copyright owner let the work go into the public domain. Under S. 1006 it could be a hundred years or more before this very same kind of material goes into the public domain and becomes usable by education. As the Register has told Congress, this is neither "necessary or advisable for all works."

The Department of Justice has opposed extension of the term beyond 56 years, as an unwarranted monopoly:

"The Department of Justice is opposed to lengthening the period of copyrights. Copyrights (and patents) are forms of monopolies and should not be extended for periods longer than those now provided by law. The present 56-year monopoly granted to authors is in our view fully adequate to reward authors for their contributions to society. Considering this matter from the viewpoint of the public, which is interested in the early passing of copyrighted material into the public domain, it would seem unwise to extend further the copyright monopoly."

These duration proposals of S. 1006 fly in the face of the action of the authors and publishers of 85% of all copyrighted works who do not seem to need or want a copyright duration more than an initial term of 28 years. To force more on them is not only a curious sort of paternalism but also detrimental to the best interests of the American people. Here again we accept and adopt the answer of the Register in his 1961 Report to the Congress:

"Advocates of a uniform single term contend that even though most works have little or no commercial value beyond 28 years, it would do no harm to let

30 Manges, Horace S., "The Shape of Copyright Revision," Publishers Weekly, January 8, 1962, 42 at 45.

31 Copyright Law Revision, Report of the Register of Copyrights, House Com. Print, 87th Cong., 1st Sess., July 1961, p. 51. [Emphasis added.]

82 Letter of Acting Deputy Attorney General Katzenbach, May 2, 1962, House Rep. No. 1742, 87th Cong., 2d Sess., on H.J. Res. 627, p. 6.

their protection continue for the maximum term. They argue that no one is interested in using a work after it has ceased to have commercial value, so the continuation of copyright would be of no practical consequence.

"We believe that this argument is fallacious on two grounds:

"Many works that have ceased to have substantial commercial value in themselves are still useful to scholars, researchers, historians, and educators, as well as to authors of new works based on preexisting ones.

The argument seems to assume that the public derives no benefits from having works in the public domain. Copyright protection for a certain period is essential to foster the creation and dissemination of intellectual works and to give authors their due reward. But on the other hand, there are many circumstances in which copyright restrictions inhibit the discrimination of works or their use in the creation of new works.

"We believe that, when authors or other copyright owners feel that they have no need for a longer term, the termination of copyright restrictions after 28 years is in the public interest." 33

The Congress enacted the present duration provision in 1909 and rejected suggestions for a life-plus-50 term. One of the specific comments in the House Committee's Report was that—

A very small percentage of the copyrights are ever renewed. All use of them ceases in most cases before the expiration of twenty-eight years. Furthermore, the present law (of a fixed 28-year initial term beginning with an objectively ascertainable date of publication) is simple and readily enables anyone to know when a copyrighted work is in the public domain. On the other hand, S. 1006 (based on an uncertain life term arising from a subjective date of creation) creates a highly complex system of variable and multiple durations. Conformity to foreign laws

One of the principal reasons advanced for S. 1006's radical departure from the 175-year old American copyright renewal practice is to have our duration provision correspond with that in foreign countries. There are many answers to this enforced conformity of our law to foreign law :

First, the U.S. Constitution itself set our copyright law apart from all foreign copyright laws; the Constitution permits copyright only "for limited times." The Copyright Act passed immediately after the adoption of the Constitution regarded 14 years as a limited time for initial terms, and the patent law (which comes under the same Constitutional provision) still has only a 17 year term. Thus, the drive for conformity to foreign laws seems to ignore the fundamental limitation in our Constitution.

Second, the best interests of the American people must prevail over any mechancial concept of conformity to foreign law. As already demonstrated, such conformity is detrimental to the some 45,000,000 school children of America.

Third, adoption of conformity-to-foreign-law as a principal basis for copyright law revision sets a dangerous precedent. For example, most foreign countries have no copyright notice requirement except for special kinds of works. Also, major foreign countries have no system of copyright registration and deposit of copyright material." By adapting the conformity-with-foreign-law rationale, do we say that henceforth copyright notice and copyright registration and deposit will also be eliminated although notice has been part of our copyright law since 1802 and registration since 1790?

Fourth, the proposed term of life-plus-50 is unnecessary, according to the Register's 1961 Report, even if Congress wants to make our maximum term generally comparable to that given American works in other countries. All that is necessary, the Register said, is to increase the total term from the present 56 years to 76:

"A term of 76 years from the first public dissemination would be generally equivalent to the term most prevalent in foreign countries Thus . this term would achieve the main purposes of those who have advocated a term of 50 years from the death of the author."

For these aforesaid reasons, the Ad Hoc Committee opposes Chapter 3 of S. 1006 in its present form and urges continuation of the provisions of § 24 of the

83 Op. cit., supra, n. 31, at 52.

84 Op. cit., supra, n. 7, at p. 14.

B Goldman, Abe A., op. cit., supra, n. 4, at 1270.

38 Op. cit., supra, n. 31, at 73.

37 Register of Copyrights, Copyright Law Revision, House Com. Print, 87th Cong., 1st Sess. (1961), p. 73.

present law (28 years plus 28 years) or, as an alternative, adoption of the Register's 1961 recommendation for an initial term of 28 years plus a 48 year renewal term. We favor a short first term and a longer second term instead of

a single term.

CONCLUSION

For this Committee's convenience in having the Ad Hoc Committee's recommendations for amendments altogether, I conclude my remarks by submitting an Appendix which sets forth these proposed amendments.

APPENDIX

TEXT OF AMENDMENTS TO S. 1006 AS PROPOSED BY THE AD HOC COMMITTEE 1. EDUCATIONAL EXEMPTION FOR LIMITED COPYING

A. New Section 111:

"111. Limitations on exclusive rights: Educational copies and recordings

"Notwithstanding the provisions of § 106, it is not an infringement of copyright for anyone lawfully entitled under § 109 to perform, exhibit, or to transmit a performance or exhibition of, a copyrighted work (save those originally consumable upon use, such as workbook exercises, problems, or answer sheets for standardized tests)

"(a) to make no more than one copy or phonorecord of the work in the course of such use, provided that no copy or phonorecord may be made of dramatic works (including any accompanying music), pantomimes and choreographic works, and motion pictures or filmstrips unless the performers and the audience are limited to students, faculty, or staff, and

"(b) to make a reasonable number of copies or phonorecords of excerpts or quotations from the work, provided that such excerpts or quotations are not substantial in length in proportion to their source,

"solely for purposes of such person's or organization's own teaching, lawful performances, exhibitions and transmissions, for course work study in connection therewith, for research or for archival purposes, provided that no such copyrighted material is sold or leased for profit and that no direct or indirect private gain is involved."

B. Resultant renumbering of present §§ 111-114 of S. 1006 and of references to them on pages 1 (after line 7), 37 (line 27) and 38 (lines 32, and 33). C. Amendment of § 109 (4), page 8, lines 4 and 5 as follows:

"(4) performance or transmission of a nondramatic literary or musical work, [otherwise than in a transmission to the public, without any prior . . .".

2. REVISION OF "FAIR USE"

Amendment of § 107, page 7 as follows:

"Notwithstanding the provisions of § 106, the fair use of a copyrighted work to the extent reasonably necessary or incidental to a legitimate purpose such as criticism, comment, news reporting, teaching, scholarship, or research is not an infringement of copyright. Noncommercial educational use by a nonprofit educational institution or organization shall be presumed to be such “fair use” unless specifically rebutted."

8. WAIVER FOR STATUTORY DAMAGES FOR INNOCENT INFRINGEMENT BY TEACHERS

19:

Addition of the following sentence to § 504 (c) (2), on page 30 at the end of line

"In a case where the infringer proves that the infringing use was for bona fide nonprofit educational purposes and made in reasonable belief that such a use was not an infringement of copyright, the court may, in its discretion, withhold any award of statutory damages under this subsection or may reduce the amount to a sum less than $100."

4. DURATION OF COPYRIGHT

The Ad Hoc Committee is not committed to any special language to accomplish its proposal for retaining the present 28-year term plus 28 (or 48) years renewal terms. The following language is taken from § 24 of the present law, and is submitted merely as one possible means of achieving this objective: