Copyright Law Revision

the cable system or its predecessor in title had, before January 1, 1971, in accordance with the applicable rules of the Federal Communications Commission, made regular secondary transmissions of the transmissions of the primary transmitter or its predecessor in title. And provided that such regular secondary transmissions shall be exempt from the requirements of clauses (4)(A) and (4)(B) of subsection (c).

(3) For the purposes of this subsection, "adequate television serv9 ice" within a United States television market is defined according to 10 the numerical rank of the market and the number and type of those 11 operating broadcast stations licensed by the Federal Communications 12 Commission whose local service areas are within that market. Con13 struction permits shall not be included in any computation for this 14 purpose.

(A) In markets 1 through 50, adequate television service comprises the network stations transmitting the programs of all the television networks providing national transmissions, three independent commercial stations, and one noncommercial educational station.

(B) In markets 51 and below, adequate television service comprises the network stations transmitting the programs of all the television networks providing national transmissions, two independent commercial stations, and one noncommercial educational station.

(4) Subject to the provisions of subsections (a) and (b) and of 26 clause (1) of this subsection, but notwithstanding the provisions of 27 clause (2) of this subsection, the secondary transmission to the public 28 by a cable system of a primary transmission made by a broadcast station licensed by the Federal Communications Commission and 30 embodying a performance or display of a work is actionable as an act of infringement under section 501, and is fully subject to the 32 remedies provided by sections 502 through 506, in the following

(A) Where the cable system, at least one month before the date of the secondary transmission, has not recorded the notice specified by subsection (d); or

(B) Where the reference point of the cable system falls within a circle defined by a radius of thirty-five air miles, or within a radius as subsequently determined by the Federal Communications Commission, after notice and public hearings, from the cen

ter of a United States television market, as defined in accordance with subsection (f), and—

(i) the primary transmission is made by a television broadcast station whose local service area is outside the market; and

(ii) a television broadcast station licensed by the Federal Communications Commission, whose local service area is within the market, has the exclusive right, under an exclusive license or other transfer of copyright, to transmit any performance or display of the same version of the work covered by the exclusive license or other transfer of copyright; and

(iii) except where the market is one of the first fifty of the United States television markets, the particular version of the work covered by the exclusive license or other transfer of copyright has never been transmitted to the public in a syndicated showing in the market by the station specified by paragraph (ii), or by any other television broadcast stations licensed by the Federal Communications Commission whose local service area is within the market; and

(iv) the station specified by paragraph (ii) has given written notice of said exclusive right to the cable system within the specified time limits and in accordance with the other requirements that the Register of Copyrights shall prescribe by regulation.

(C) Where the reference point of the cable system is within a United States television market, as defined in accordance with subsection (f), and—

(i) the content of the particular transmission program consists primarily of an organized professional team sporting event occurring simultaneously with the initial fixation and primary transmission of the program; and

(ii) the secondary transmission is made for reception wholly or partly outside the local service area of the primary transmitter; and

(iii) the secondary transmission is made for reception wholly or partly within the local service area of one or more television broadcasting stations licensed by the Federal Communications Commission, none of which has received authorization to transmit said program within such area.

(d) COMPULSORY LICENSE FOR SECONDARY TRANSMISSIONS BY CABLE SYSTEMS.

(1) For any secondary transmission to be subject to compulsory

1 licensing under subsection (c), the cable system shall, at least one

month before the date of the secondary transmission, record in the 3 Copyright Office, in accordance with requirements that the Register of 4 Copyrights shall prescribe by regulation, a notice including a statement of the identity and address of the person who owns the secondary transmission service or has power to exercise primary control over it, 7 together with the name and location of the primary transmitter. (2) A cable system whose secondary transmissions have been subject to compulsory licensing under subsection (c) shall, during the months of January, April, July, and October, deposit with the Register of 11 Copyrights, in accordance with requirements that the Register shall 12 prescribe by regulation—

(A) A statement of account, covering the three months next preceding, specifying the number of channels on which the cable system made secondary transmissions to its subscribers, the names and locations of all primary transmitters whose transmissions were further transmitted by the cable system, the total number of subscribers to the cable system, and the gross amounts paid to the cable system by subscribers for the basic service of providing secondary transmissions of primary broadcast transmitters; and

(B) A total royalty fee for the period covered by the statement, computed on the basis of specified percentages of the gross receipts from subscribers to the cable service during said period, as follows:

(i) 1 percent of any gross receipts up to $40,000;

(ii) 2 percent of any gross receipts totalling more than

$40,000 but not more than $80,000;

(iii) 3 percent of any gross receipts totalling more than $80,000, but not more than $120,000;

(iv) 4 percent of any gross receipts totalling more than $120,000, but not more than $160,000; and

(v) 5 percent of any gross receipts totalling more than $160,000.

The total royalty fee shall include an additional 1 percent of the gross receipts paid by subscribers for the basic service of providing secondary transmissions of primary broadcast transmitter for each channel on which the cable system, under a compulsory license, is permitted by the Federal Communications Commission to increase the number of signals comprising adequate service pursuant to clause (2) (B) of subsection (e).

(3) The royalty fees thus deposited shall be distributed in accordance with the following procedures:

(A) During the month of July in each year, every person claiming to be entitled to compulsory license fees for secondary transmissions made during the preceding twelve-month period shall file a claim with the Register of Copyrights, in accordance with requirements that Register shall prescribe by regulation. Notwithstanding any provisions of the antitrust laws (the Act of October 15, 1914, 38 Stat. 730, and any amendments of any such laws), for purposes of this clause any claimants may agree among themselves as to the proportionate division of compulsory licensing fees among them, may lump their claims together and file them jointly or as a single claim, or may designate a common agent to receive payment on their behalf.

(B) After the first day of August of each year, the Register of Copyrights shall determine whether there exists a controversy concerning the distribution of royalty fees deposited under clause (2). If he determines that no such controversy exists, he shall, after deducting his reasonable administrative costs under this section, distribute such fees to the copyright owners entitled, or to their designated agents. If he finds the existence of a controversy he shall certify to that fact and proceed to constitute a panel of the Copyright Royalty Tribunal in accordance with section 803. In such cases the reasonable administrative costs of the Register under this section shall be deducted prior to distribution of the royalty fee by the tribunal.

(C) After deducting the costs of administration, 15 percent of the royalty fees collected shall be maintained in a special fund, and shall be distributed, according to regulations prescribed by the Register of Copyrights, to the copyright owners, or their designated agents, of musical works.

(D) During the pendency of any proceeding under this subsection, the Register of Copyrights or the Copyright Royalty Tribunal shall withhold from distribution an amount sufficient to satisfy all claims with respect to which a controversy exists, but shall have discretion to proceed to distribute any amounts that are not in controversy. (e) PREEMPTION OF OTHER LAWS AND REGULATIONS.—

(1) Except as provided by clause (2), on and after January 1, 1975, all Federal, State, and local laws and regulations restricting the right of a cable system to make secondary transmissions in any case made subject to compulsory licensing by this section are preempted by this title. Thereafter, unless specifically authorized by this subsection, the

1 Federal Communications Commission or any other governmental

agency or instrumentality shall not issue or enforce any order, notice, 3 rule, or regulation requiring a cable system to obtain authority of the 4 copyright owner as a condition for making any secondary transmis5 sion, or prohibiting a cable system from making secondary trans6 missions within an area where such secondary transmissions are per7 missible under the compulsory licensing provisions of subsection (c). 8 However, nothing in this section shall be construed to preempt the 9 authority of the Federal Communications Commission, with respect to a cable system whose reference point is within a United States television market

(A) to prevent the cable system from further transmitting a primary transmission made by a television broadcast station, whose local service area is outside the market, on the same day that another station licensed by the Commission, whose local service area is within the market, transmits the same transmission program;

(B) to compel the cable system to make secondary transmissions of primary transmissions by television broadcast stations licensed by the Commission, whose local service area is within the market; and

(2) Notwithstanding the provisions of clause (1), the Federal Communications Commission shall have the responsibility to establish various criteria and definitions as provided by subsection (f), and shall have the authority in the public interest, and in accordance with requirements that the Commission shall prescribe by regulation, to do the following:

(A) to permit a cable system to substitute, for the signal of the station specified in the compulsory licensing provisions of paragraph (ii) of subsection (c) (2) (A), a more distant signal ;

(B) to increase the number of signals of stations specified in the compulsory licensing provisions of clause (3) of subsection (c) as comprising adequate television service for a United States television market; and

(C) to permit a cable system that is required to delete a signal under the provisions of clause (4) of subsection (c), to substitute the signal of another station of the same kind and within the

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Copyright Law Revision: Hearings, Ninety-third Congress, First Session ...