PREPARED STATEMENT OF MICHAEL F. RODGERS, SENIOR VICE PRESIDENT FOR POLICY AND GOVERNMENT AFFAIRS, AMERICAN ASSOCIATION OF HOMES FOR THE AGING

Mr. Chairman and members of the Committee, I am Michael F. Rodgers, Senior Vice President for Policy and Government Affairs, representing the American Association of Homes for the Aging (AAHA). I appreciate the opportunity to testify this morning in support of a bill that would improve the quality of life for thousands of elderly living in nursing homes across the country. H.R. 3158, the Nursing Home Viewers's Rights Act, would clarify that the use of videocassette films in nursing homes does not require licensing under the Copyright Act.

AAHA is a national association representing over 3,500 not-for-profit facilities providing health care, housing and community services to more than 600,000 elderly individuals. Over 75 percent of AAHA homes are affiliated with religious organizations, while the remaining are sponsored by private foundations, fraternal organizations, government agencies, unions, and community groups. With strong community involvement and longstanding community ties, AAHA members are committed to meeting the physical, social, psychological, emotional, and spiritual needs of their residents in a manner which enhances residents' sense of self-worth and dignity and allows them to function at their highest possible levels. H.R. 3158, and its companion bill S. 1557, are important to our members. The use of videocassette films has been a useful and popular activity for residents, providing a means for them to socialize in small groups, and helping them stay abreast of the types of films enjoyed by others outside communal settings. This "connectedness" is inherently important in maintaining a high quality of life for nursing home residents. Some of the older films serve the additional purpose of helping residents reminisce about their past and share their experiences.

The Nature of Videocassette Viewing in Member Homes

Before the current controversy arose, our members used videocassette films as part of activity programs for groups of elderly residents. Activity directors rented films from local outlets in the same manner all of us rent films for our family viewing. The films were shown to residents in the common areas of the homes. For all practical purposes, this was the only opportunity for these individuals to view either current films or their favorite "oldies." The residents of nursing homes are frail, and trips to the local movie house just aren't possible for them anymore.

Beginning in 1984 when our members were first threatened with lawsuits for conducting what motion picture representatives contended were "public performances" of videocassettes in nursing homes, we were astounded to think that these residences would be construed as public, either in the colloquial or legal sense. The viewings were small, intimate gatherings of residents, at no charge to them. Our view was that the license granted by renting the tapes was sufficient in that the notice clearly stated that "The owner of the copyright in this motion picture has authorized its use

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in this cassette for the purpose of private home viewing without charge of any kind.... (Emphasis added.) And although we realize that only Congress and the courts can construe the meaning of the Copyright Act, the plain reading of the Act and the federal case law in this area seemed to support our initial conclusion that nursing home performances of these films were private.

We understand that the Copyright Act grants to copyright owners, subject to certain exceptions, the exclusive right to do or authorize the "public performance" of their copyrighted works. Section 101 of the Copyright Act states that a performance is considered "public" if it occurs at a place open to the public or at any place "where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered," i.e., a semi-public place.

Initially, it is clear that none of our members are "open to the public" as that phrase is used in case law. They are not retail establishments, e.g., Columbia Pictures Industries, Inc. v. Aveco, Inc., 800 F.2d 59 (3d Cir. 1986); clubs,. e.g., Hinton v. Mainlands of Tamarac, 611 F. supp. 494 (S.D. Fla, 1985); or similar places which hold their facilities out for temporary occupancy by members of the general public.

Nor do we believe that any of our members are "semi-public" places under the Act. The legislative history of the Act suggests that Congress was not contemplating performances in residential facilities when it enacted this section. Instead, Congress focused on performances held at non-residential places such as "clubs, lodges, factories, summer camps and schools." H. Rep. No. 94-1476, 94th Cong., 2d Sess. 64. Contrary to claims made by one of the motion picture distributors in 1984, nursing homes and similar establishments are nowhere mentioned in the referenced Report language. Under these circumstances, it is difficult to understand how the claim of public performance ever arose. The residents of our facilities live permanently in these homes. In many cases, they merely have a bedroom-frequently shared--and no living room or kitchen. The "home" therefore consists of a common eating area, lounge, and their private or semi-private bedroom and bath. Could Congress have intended that that when several elderly residents, and perhaps a few family members or friends, convene in the common living room they have transformed their home into a "semi-public" place? The copyright law has never required those viewing a videotape within their own home with a small group of friends to pay a copyright owner a public performance fee, through a license agreement or otherwise.

Moreover, Section 101 of the Copyright Act indicates that Congress limited a "public" performance, even in normally private places, to instances where a "substantial" number of persons outside a normal family circle and friends was gathered. To argue that performances in common areas of our facilities are public without even looking at the nature of the audience seems to say that 1.6 million nursing home residents in this country, by mere virtue of their physical residence, are incapable of developing a

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"institutional" outlook is not the message we want to give to these individuals, particularly when all our other efforts are directed to creating a homelike environment. The argument also ignores the demographic realities of the nursing home population. The "average" nursing home resident is female, 89 years old, and single--usually widowed. About half have no families, or few family members, in the local area. If their normal circle of family and friends does not come from the facility, from where will it come? One of our residents, Mrs. Natalie Runkel of Covenant Shores, Mercer Island, Washington, stated recently,

"I think it would be greatly unjust to deny us the privilege of seeing films in our home simply because the motion picture licensing organization fails to recognize that a retirement or nursing home is the only home many of us senior citizens have and that watching a movie is truly a family affair for us in our communal living room. It would be unfair to deny us the 'home use' exception to the copyright licensing laws.

"I am a widow in a wheel chair. The family movie is a highlight of my week."

If the motion picture industry is concerned that additional persons, other than the normal circle of family and friends in the facility will view the films, we can provide them with a great deal of reassurance to the We have never had the problem of too many people visiting

contrary. nursing homes.

The Need for Legislation

The disagreement between our facilities and the motion picture industry on whether these performances are public or private can be clarified in only two ways: it can be legislated or it can be litigated. If Congress does not act, we believe the constant fear of costly, drawn-out litigation felt by our members will continue to chill all permissible activity in this area. We believe that if the elderly in residential facilities are to maintain the same film-viewing rights they had in their previous homes, then it is Congress who will make sure those rights are preserved.

We appreciate the fact that Congress and the motion picture industry both are sensitive to compromising the Copyright Act and to opening a "floodgate." It is not our intent to create that result. However, H.R. 3158 and S. 1557 are clear and narrowly drawn. Both ensure that the technology used to perform the film does not exceed that available to ordinary homes, and both restrict coverage to those facilities which provide regular long term health or health-related care and services to individuals whose temporary or permanent home is the facility.

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Are Letters from the Motion Picture Industry Enough?

The motion picture industry maintains that this legislation is not necessary because the studios and distributors are willing to redefine their policies to either (1) no longer demand licenses and fees from nursing homes; or (2) grant free licenses to homes for a period of years. The studios and distributors would prefer to do this by individual letters. We are wary of this approach for several reasons. Initially, it is clear to us that even if all the studios and distribution companies provided letters, these voluntary agreements could be modified or withdrawn at any time. This does not provide the certainty our members feel they need. Second, by focusing on the policies of the studios, rather than on the nature of the performances, it seems to us as though a settlement is possible only for as long as those particular studios and distributors retain the rights they are bestowing. After spending a considerable amount of time on this issue, we are still amazed at the broad group encompassed by the term "video industry." The entanglement of "affiliates," "subsidiaries," "agents," and "joint venturers" makes it difficult to decipher what bundle of rights any one group controls. What's clear is that the ability to understand who controls the rights is essential, given that those rights can be sliced up in a variety of ways. For example, what will the effect of a voluntary policy be if Studio Y provides a letter but later sells its film library in a completely unrelated transaction? What if Studio X produces a film with Studio z, and only Studio X has adopted the voluntary policy? In today's commercial environment, surely it would be unreasonable to expect the motion picture studios to retain exactly the same film rights they currently posess just to ensure that they can honor their voluntary policy toward nursing homes. Similarly, it would be unreasonable to think that we could anticipate all the possible copyright distribution patterns so that we could ensure that we received a letter from every conceivable copyright owner.

A third concern we have is how a policy stated in a letter will affect possible successors in interest with respect to the studios. This is not to intimate that the motion picture industry is less stable than others; however, it is impossible not to notice the recent sale of two major organizations to foreign interests. Is there any assurance that this letter will be enough to continue the nursing home policy beyond current owners?

Our fourth issue is whether a letter will be sufficient to provide notice to those who show films, and to those who distribute them. Again, by emphasizing the policy adopted by individual studios rather than the nature of the performance, our members who show films will be in the position of examining every cassette jacket to try to determine whether the copyrights are covered by one of the voluntary policies. This will present a problem

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same name as the parent company. Another example is that of those companies which produce films independently, but distribute them through major studios. Will it be evident to a nursing home staff person whether those films are covered by one of the policies? It seems to us that our members will have to understand some fairly complex current--and future-relationships between members of the film industry to ensure that they are operating within the boundaries of the voluntary policy. We believe this will be confusing for our members and the videocassette rental centers, as well.

We are also curious about notice to those who distribute the films. Whereas everyone is responsible for knowing the law, will there be industry-wide notice of the voluntary policy? Although we have no reason to question the honor of those who would sign the letters setting forth the new policy, we are uneasy about how this policy would be communicated to those "in the ranks." It is the local and regional representatives with whom our members have contact and who must be alerted to avoid over-zealous, if well-meaning, implementation of licensing policies.

For all the reasons stated, we believe the solution to this issue lies in focusing on the nature of the performance, rather than on the actions of the copyright owners. It is our view that the proposed legislation accomplishes the goal of certainty for both our members and the motion picture industry without unduly curtailing the protection the Copyright Act offers to copyright owners.

Conclusion

Our members strongly support H.R. 3158 and S. 1557, and thank Congressman Cardin and Senator Roth for their initiatives in this area. We thank you, Mr. Chairman, for providing a public forum so that this issue can be aired. Through several nursing home quality of life measures passed in recent years, legislators, regulators, providers, and consumers have rededicated themselves to ensuring that elderly individuals do not leave their rights behind them as they forego their own homes for communal settings. We look to the leadership of this Subcommittee to reaffirm that those rights include the viewing rights our senior citizens had in their former residences.