But I certainly understand your answer and appreciate it.

I am going to yield at this point to my colleague, the gentleman from Ohio, Mr. Kindness.

Mr. KINDNESS. Thank you, Mr. Chairman.

And I thank our colleagues for their presence and testimony this morning. The first thing I would like to explain is that I am the new kid on the block in this area with copyright law and would appreciate your tolerance.

There is a conceptual question that I have and I would like to pursue with you. I am having difficulty in differentiating the protection that ought to be accorded to the mask work that goes into the production of a chip, microprocessor, let's say, as distinguished from the content that can be produced by the use of that microprocessor.

The point was raised, and what we raised in testimony from the publishers was that there would be incorporated into the functioning of the microprocessor presumably in the future and even now the content of a publication, a book. Perhaps whole libraries would be stored in this manner in the future. But the original work which would be subject to copyright protection, if in printed form, when incorporated into a microprocessor then becomes at conflict with the protection of that product, and is in conflict with the protection of the microprocessor itself or the mask work in it, or could potentially be.

I say this because it is my understanding of the industry that it would not be very practical for a publisher, let's say, to have his own microprocessor production and thus keep the control of the whole work that is involved, the book.

Do you see the possibility that this legislation ought to have in it some provision that separates out the protection of the copyright law that ought to be afforded to the mask work on the one hand and then find some way of making it compatible with the copyright protection that logically should be afforded to that book or that work when it is converted into microprocessor form on the other hand?

Would it be reasonable, in your view, as authors and sponsors of the bill, if it is possible to do so, to afford that separate status and protection under the copyright laws for those two products?

Mr. EDWARDS. Well, Mr. Kindness, we might be talking about apples and oranges.

Mr. KINDNESS. Would you care to change the apple part?

Mr. EDWARDS. Because the subject of books and libraries is something that your subcommittee has long dealt with, authors and artists have received appropriate protection, largely through the legislation enacted that began in the subcommittee that you are a member of. And I do think that it is a little bit of a different subject, although I would not have any objection to the concept that you suggest.

Mr. KINDNESS. Well, once the book is embodied in a microprocessor, well, then-as I say, I am having a conceptual problem herethey become almost one and the same. I have a book that I have published and printed, and I go to you as a producer of microprocessors, and I say, I want this converted into circuitry so that it can be used electronically and conveyed in that manner.

Our contractual relationship can probably handle most of the property rights area up until we sell that microprocessor on the marketplace and somebody else takes it and reverse engineers it. And then they have got my book.

This is the part I am getting a little bit concerned about as we go through this. Should we be addressing that problem, or do you feel that is something that we ought to be leaving out of this question at the present time?

Mr. EDWARDS. I believe it is very possible that a book is already protected by the copyright law. Certainly insofar as the copying of books and resale and the use in libraries. And programs are already protected under the copyright laws, but layouts themselves are not. This is the layout that would be protected, not the final product. That would already be protected.

Mr. MINETA. Also, Mr. Kindness, I think that Mr. Dunlap, who will be testifying later on, who is representing the semiconductor industry and is also corporate counsel for one of our leading companies, will probably be able to address that issue.

Mr. KINDNESS. But if I might just put the basic question then. If there appears to be a reasonable and amenable way to deal with that, assuming that what I am describing is a problem which I believe it is, there is no basic objection on the part of the authors relative to addressing that question in this legislation.

Mr. EDWARDS. I believe that the Senate addresses that. I believe the bill says that copyright in a chip does not add to or lessen any other type of copyright relating to a work embodied in a chip. So that perhaps might answer that. And I'm sure that your expert examination of this issue can resolve that, but I do appreciate your point.

Mr. KINDNESS. Thank you.

Mr. KASTENMEIER. May I ask my colleagues-we have a vote on. We have about 10 minutes. Would you-and I'm addressing myself to Mrs. Schroeder, and Mr. Synar-care to ask questions now or come back after the vote.

Mrs. SCHROEDER. I think they've convinced us. I'm prepared.
Mr. KASTENMEIER. Well, do you have questions?

Mr. SYNAR. No questions.

Mr. KASTENMEIER. Would our witnesses care to return following the vote?

Mr. FRANK. Since Mr. Mineta said he wasn't a lawyer, I'm sure I don't have any problems with him.

Mr. KASTENMEIER. Well, if my colleagues have no questions of the witnesses, then on behalf of all of us, I would thank you very much for your presentation this morning, and we appreciate your contribution.

The committee will recess for 10 minutes and return.

Mr. EDWARDS. Thank you very much. [Recess.]

Mr. KASTENMEIER. The committee will come to order. I'd like to welcome our first public witness, Jon Baumgarten. Mr. Baumgarten is well known as an expert on copyright law and was General Counsel to the Copyright Office from 1976 to 1979. He has reported to this committee before. He is now an attorney in private practice

with the law firm of Paskus, Gordon & Hyman, and represents the Association of American Publishers. Welcome, Mr. Baumgarten.

TESTIMONY OF JON A. BAUMGARTEN, COPYRIGHT COUNSEL, ASSOCIATION OF AMERICAN PUBLISHERS, INC.

Mr. BAUMGARTEN. Thank you, Mr. Chairman. May I ask at this point that my prepared statement be entered into the record, and I'll essentially summarize it as we proceed.

[Complete statement follows:]

PREPARED STATEMENT OF JON A. BAUMGARTEN, COPYRIGHT COUNSEL, ASSOCIATION OF AMERICAN PUBLISHERS, INC.

Mr. Chairman and members of the Subcommittee, I am Jon A. Baumgarten, a member of Paskus, Gordon & Hyman, copyright counsel to the Association of American Publishers, Inc. ("AAP"). The AAP is a trade association representing America's "book and journal" publishers. The phrase "book and journal" appears in quotation marks because, if limited to its conventional paper-and-binding connotation, it does not adequately describe our members' activities. This is particularly the case with respect to the proposed legislation before you this morning. Our members do publish books-fiction and non-fiction trade books, textbooks at all educational levels and related materials, reference works and encyclopedias, self-help and do-ityourself books and others—and scientific, technical, medical, scholarly, and professional journals. But they also, and increasingly so, are intimately involved in the creation and publication of new media: computer programs and software of general consumer, business, and other special-market nature; computer-assisted learning materials (including educational and like games and audiovisual works) and "courseware"; and automated data bases. As will be shown below, the provisions of H.R. 1028 may substantially impact upon the interests of every segment of our membership, and we greatly appreciate the opportunity to appear before you.

Before turning to a more particular description of our interests and views regarding H.R. 1028, I want to make clear at the outset that the AAP is not questioning the creativity, skill, labor, or investment of chip designers, or their need for and entitlement to appropriate protection from piracy.

Nor do we challenge the twin premises of Congressmen Edwards and Mineta in introducing this legislation-namely, that the proprietary interests of creative entrepreneurs must remain properly safeguarded from technological onslaught, and that innovative legislation may be the appropriate vehicle toward this end. Quite the contrary-the copyright interests of book and journal publishers have particularly suffered from indiscriminate application of the new technologies of disseminating and reproducing intellectual products, and we can well understand the concerns of other industries with similar threats. What we do question is the precise nature of the bill currently under consideration, and it is to this that I will now turn. AAP's interests and concerns with respect to H.R. 1028 are essentially twofold: A. AAP urges that the Committee approach chip protection as a severable, unitary measure and not as piecemeal amendments to the basic Copyright Act.

In making this recommendation, AAP supports what has been called the "sui generis" approach to chip protection. We have avoided this description both because it has broader connotations, and in the event it offends those who assert that some copyright concepts-particularly automatic protection based upon independent creation or "originality" rather than patent prosecutions under standards of "novelty"-can and should be applied to these products. Our difference is not with this assertion; if the case can be made for the application of selected copyright concepts, Congress might consider doing so. Our concern lies with the obverse—that is, with the fundamental departures from the copyright system that accompany the proposal, e.g., the extension of Copyright Act protection to utilitarian objects that, it is acknowledged, may not be "writings" under the Constitution (and, for example, the potential impact of this on the evidentiary advantages of copyright registration); the

It is sometimes urged that "sui generis" protection be accorded, in lieu of copyright as such, to software. The AAP does not agree with this contention, and considers it distinguishable from the issue of chip protection. The Copyright Act generally appears to be operating acceptably for software protection and no basic departures from copyright precepts yet appear necessary. Indeed, part of our concern with H.R. 1028 is that it may inadvertently weaken software protection. See [B., below.

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according of an apparent "use" right; the limitations on remedies against infringers and the extension of compulsory licensing; and, most notably, the limitation imposed on the duration of protection of this particular class, and the distortion of the fair use doctrine to accommodate reverse engineering.2

It must be emphasized that our concern is not born out of a mere desire for ideologically "pure" copyright law, nor-as noted above-aversion to innovative legislation. It lies, instead, with the blurring or distortion of principles and the establishment of precedents that may have untoward and unintended consequences for copyright protection of our works, and those of other copyright proprietors.

In sum AAP believes that H.R. 1028 would effect such basic modifications in copyright law that a unified approach to chip protection, identified as separate from the general Copyright Act itself, is called for. We submit that the price to be paid in additional draftsmanship will be well worth the resulting greater cogency and precision.

B. AAP urges that (1) the limitations on chip protection be expressly made inapplicable to other works fixed, represented, or embodied therein; and (2) that the copyright owners of such works be assured of protection from unauthorized reproduction in chips.

From the viewpoint of our industry, semiconductor chips and their associated products are essentially vehicles for the dissemination and efficient use of our works. Clearly, our software programs, data bases, and audiovisual works (as represented, for example, in instructional "games") will be-and in some cases already are-marketed in "chip form" for use in connection with business, home and school computers and micro-processor based devices. And it would be mistaken and shortsighted to assume that this will not be the case with respect to the content of our books and journals. Thus, Townsend Hoopes, President of the Association, has described the forthcoming world of "books-on-a-chip" as follows:

"Some computer scientists believe that computer technology, particularly the microcomputer, which today can compress information by ten thousandfold, will give us entire books printed on a single silicon chip by the late 1980s. Later it may be possible to store a whole library in about the same space now occupied by a paperback novel. According to this theory, books will be produced on silicon chips and mailed by the dozen in small envelopes direct to the reader. The reader will insert the chip into a reader terminal, which may for aesthetic reasons resemble a traditional book, with leather covers and gold clasps. The terminal will translate the binary code into English, with adjustable print size, and the reader will take it from there."

5

Others have made similar forecasts. There is no reason to believe that these hypotheses are too remote for contemporary Congressional consideration-a conclusion strengthened by recent developments in connection with increased capacity memory devices. As Dr. Elie Shneour, in an essay entitled "A Look Into the Book of the Future" (Publishers Weekly, January 21, 1983 at 48), recently stated:

2 The discussion of "fair use" and "reverse engineering" at p. H645 of the Congressional Record of February 24, 1983 is not entirely clear. For example, the fact that otherwise infringing activity may involve "teaching, analysis, or study," whether in an educational or business environment, cannot itself lead to a conclusion of fair use. E.g., Wihtol v. Crow, 309 F. 2d 777 (8th Cir. 1962); cf. Cong. Rec., May 4, 1983 at S. 5992, (referring to pirates "study[ing] the design"). And the House memorandum (p. H645) itself blurs the distinction between "fair use" and the mere adoption of ideas (see e.g., 3 Nimmer, Copyright § 13.05 at 13-55), and reverse engineering. Additionally, it has been questioned whether the kind of "reverse engineering" intended to be privileged by the bill can fall within the general doctrine of fair use without distorting its role and contours. See, e.g., Copyright Protection for Imprinted Design Patterns on Semiconductor Chips, Hearings Before the Subcommittee on Court, Civil Liberties and the Administration of Justice of the House Committee on the Judiciary, 96th Cong., 1st Sess., April 16, 1979 at 21, 54, 61.

3 We note that a similar approach is taken in the recent introduction in the House of Representatives of H.R. 2985 on May 11, 1983. This measure, providing for the protection of designs, is a particularly applicable precedent. And we do not think the proponents of chip protection need become hostage or subject to the fortunes of that bill. There is no reason why protection for designs cannot start with (or even be limited to) chips. The principle of unified, separately identifiable legislation is the important point.

*Remarks of Townsend Hoopes, president, AAP, before the NYU Workshop on Book Publishing: "The Electronic Revolution and the Future of the Book," Jan. 22, 1982.

E.g., evans, "The Micro Millenium" 115-117 (1979); U.S. News & World Report, May 9, 1983 at A-8.

"See, e.g., Washington Post, May 18, 1983 at A-1.

"The sociologist Wilbur Schramm has recently pointed out that it took not less than 5 million years for evolving humankind to go from the primitive elements of a spoken language to the written work. From the written word of the tablets and scrolls to movable-type printing required another 5.000 years. From Gutenberg's Bible to television, less than 500 years proved necessary. It has been less than 50 years since the first electronic computer was devised. Each major advance in information handling has taken one order of magnitude less time than the preceding one. On that basis, may we expect the book of the future to be evolving before the end of this decade?"

(1) We understand that both the protection accorded under H.R. 1028 and the limitations thereon-for example, the "compulsory license" of proposed § 119; the limited term of protection under proposed 302(f); and the provision for "innocent infringers" in proposed § 501(e)—are directed toward the creation and unauthorized use of chip architecture, topography, configuration or the like, but not toward software, data bases, or other literary or audiovisual works that may be fixed, represented, or embodied therein. We believe that it is imperative that this principle be expressed in any chip legislation moving forward from this hearing. Cf., e.g., 17 U.S.C. 114(c) (limitation of rights in sound recordings "does not limit or impair" the right to control public performance of music in the same phonorecord). We would be pleased to work with committee staff in developing appropriate language. In the absence of such an express reservation, particularly in light of the complex issues that will be brought before the courts under any chip legislation enacted, we fear that the Congress may, erroneously, be found to have limited the rights of publishers and those of authors in their creative endeavors by happenstance of the vehicle chosen for dissemination. Indeed, even the risk of such a result could dampen the ability or willingness of our industry to use or license chip distribution-a result that would be far from the interests of the bill's sponsors, proponents, and the public.

(2) A related consideration applies to the limited application of the term "copy" adopted in Sec. 2 of the bill (p. 3, lines 3-6). If at some point one or more of our members' copyrighted computer programs or literary works were embodied, without permission, in a chip device, we are concerned that this provision could-inadvertently, we believe-impair the copyright owner's ability to proceed against this unauthorized use as a violation of the exclusive rights under 17 U.S.C. 106 to "reproduce the copyrighted work in copies..." and to "distribute copies of the copyrighted work. This is because the reference to "cop[ies]" in Sec. 2 of the bill does not expressly include that term as used in 17 U.S.C. 101 (definitions) or 106.7 Thank you for the opportunity to present these views.

Mr. BAUMGARTEN. Mr. Chairman, members of the subcommittee. My name is Jon Baumgarten. I am a member of the firm of Paskus, Gorden & Hyman, copyright counsel to the Association of American Publishers. The AAP represents publishers of books of all types and also, increasingly so, publishers of new media, including software and computer-assisted learning materials.

We believe that the provisions of H.R. 1028 will substantially impact on the interests of every segment of our membership and we greatly appreciate the opportunity to make these views known to you this morning.

Before turning to a more particular description of our interests and views regarding H.R. 1028, I want to emphasize at the outset that the AAP in no way questions the creativity, skill, labor, or investment of chip designers or their need for protection from piracy and entitlement to protection.

And we do not challenge the premises of Congressman Edwards and Congressman Mineta in introducing this legislation; namely, that the proprietary interests of creative entrepreneurs must remain properly safeguarded from technological onslaught, and

? Because the final clause of the pertinent provision of Section 2 (page 3, lines 5-6: "this is subject to the exclusive rights described in section 106") itself may encompass less than all semiconductor chip products in which AAP members' works are reproduced, it does not appear that this issue can be resolved simply by adding sections 101 and/or 106 to the enumeration now in Section 2 of the bill.