MJC and its union, the United Food & Commercial Workers Union, Local 27 use AAA two to three times a year for collective bargaining agreement disputes they cannot resolve. It usually takes 1⁄2 day. The parties pick an arbitrator from a seven to eight member panel. The arbitrator comes to the Track and is presented with concise positions by each side. The arbitrator usually pronounces a “judgment of Solomon.” I have agreed and disagreed with various results but in all cases the decision is acceptable and above all, more cost effective and expedicnt than Federal District Court litigation.

Thank you for your consideration. I hope these comments illuminate the practical effect of these issues. MJC respectfully urges the Пouse to ameliorate the inequities of Television Background Music royalty fees and New York Federal District Court litigation to resolve rate disputes.

104TH CONGRESS 1ST SESSION

H. R. 789

To amend title 17, United States Code, with respect to the licensing of music, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 1, 1995

Mr. SENSENBRENNER introduced the following bill; which was referred to the
Committee on the Judiciary

1

A BILL

To amend title 17, United States Code, with respect to

the licensing of music, and for other purposes.

Be it enacted by the Senate and House of Representa

2 tives of the United States of America in Congress assembled, 3 SECTION 1. SHORT TITLE.

4

This Act may be cited as the "Fairness in Musical

5 Licensing Act of 1995”.

6 SEC. 2. BUSINESS EXEMPTION.

7

Section 110(5) of title 17, United States Code, is

8 amended to read as follows:

9

"(5) communication by electronic device of a

10 transmission embodying a performance or display of

1

2

3

4

5

6

7

8

9

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a work by the reception of a broadcast, cable, sat

ellite, or other transmission, unless

"(A) an admission fee is charged specifi

cally to see or hear the transmission, or

"(B) the transmission is not properly licensed,

except that this paragraph shall apply in the case of a performance or display in a commercial establish

ment only if the performance or display is incidental to the main purpose of the establishment;".

11 SEC. 3. BINDING ARBITRATION OF RATE DISPUTES INVOLV.

12

13

ING PERFORMING RIGHTS SOCIETIES.

(a) IN GENERAL.-Section 504 of title 17, United

14 States Code, is amended by adding at the end the follow

15 ing new subsection:

16

"(d) PERFORMING RIGHTS SOCIETIES; BINDING AR

17 BITRATION.

18

19

“(1) ARBITRATION OF DISPUTES PRIOR TO

COURT ACTION.

“(A) ARBITRATION.—(i) If a general music user and a performing rights society are unable to agree on the appropriate fee to be paid for the user's past or future performance of musical works in the repertoire of the performing

rights society, the general music user shall, in

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lieu of any other dispute-resolution mechanism established by any judgment or decree governing the operation of the performing rights society, be entitled to binding arbitration of such disagreement pursuant to the rules of the American Arbitration Association. The music user may initiate such arbitration.

"(ii) The arbitrator in such binding arbitration shall determine a fair and reasonable fee

for the general music user's past and future performance of musical works in such society's repertoire and shall determine whether the user's past performances of such musical works, if any, infringed the copyrights of works in the

society's repertoire. If the arbitrator determines

that the general music user's past performances of such musical works infringed the copyrights

of works in the society's repertoire, the arbitra

tor shall impose a penalty for such infringement. Such penalty shall not exceed the arbitra

tor's determination of the fair and reasonable

license fee for the performances at issue.

"(B) DEFINITION.-For purposes of this paragraph, a 'general music user' is any person

who performs musical works publicly but is not

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engaged in the transmission of musical works to the general public or to subscribers through broadcast, cable, satellite, or other transmission. For purposes of this paragraph, trans

missions within a single commercial establishment or within establishments under common

ownership or control are not transmissions to the general public.

"(C) ENFORCEMENT OF ARBITRATOR'S DETERMINATIONS.-An arbitrator's determination under this paragraph is binding on the parties and may be enforced pursuant to sections 9 through 13 of title 9.

"(2) COURT-ANNEXED ARBITRATION.-In any civil action for infringement of the right granted in section 106(4) involving a musical work that is in

the repertoire of a performing rights society, if the defendant admits the prior public performance of

one or more works in the repertoire of the performing rights society but contests the amount of the li

cense fee demanded by such society for such performance, the dispute shall, if requested by the defendant, be submitted to arbitration under section 652(e) of title 28. In such arbitration proceeding,

the arbitrator shall determine the amount owed by

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