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Would you be willing to sell back to a director the colorized rights, if you feel you have such rights, to his film if he asked, or would that be purely a commercial decision.

Mr. MAYER. I think that would be a commercial decision. However, since we feel that this library that we own is not only the largest in the world but the best, we would be very unlikely to want to sell the rights to anybody. If it were important enough to a director to control his own work, I think there are many companies that would be willing to sell those rights back to the director, particularly since about 80 percent of most motion pictures are not in profit after they leave the theater, so it is necessary to go into these other forms of exhibition in order to recoup the investment.

Senator LEAHY. Would your answer be basically the same, Mr. Young?

Mr. YOUNG. Yes, it would.

Senator LEAHY. We have a Calder's "Mountain and Clouds" over in the Hart Building. This is a huge mobile designed by Alexander Calder. I checked with the Architect of the Capitol's office. He said we now own it. So, of course, we have got the authority to change it.

Suppose we voted in the Senate to change the color of it, change the mountains to green I would assume, being from Vermont, and make the clouds white. Any problem with that?

Mr. YOUNG. Are you asking Mr. Mayer or myself? Senator LEAHY. I ask you both. First Mr. Mayer and then you, Mr. Young

Mr. MAYER. Yes, because you are taking the original and destroying it, which we are not doing. If you would like

Senator LEAHY. We can always paint it back black.

Mr. MAYER. If you can paint it back exactly the same, then my answer would be you have that right. But I think you do not have the right to destroy something. I would be surprised, by the way, with the reaction of the man that gave you the legal information concerning Mr. Calder, because most artists today in their contractual rights, even when they sell a picture, do retain certain rights to make certain that picture is not destroyed.

But assuming what you are saying is correct, Senator-

Senator LEAHY. Let's assume he didn't retain them. Let's assume he assumed the Senate would alter his work.

Mr. MAYER. You should not do it. I hope you cannot do it if what it does is destroy the original.

Senator LEAHY. I want to hasten to add that I am not going to introduce legislation to do that.

Mr. Young
Mr. YOUNG. My answer is exactly the same as Mr. Mayer's.
Senator LEAHY. Mr. Word.
Mr. WORD. I concur.
Senator LEAHY. Anybody want to add anything else?

Mr. MAYER. No, only that we really do appreciate the opportunity to get our point of view on the record, Senator. It is extremely disturbing to us that we, from time to time, do not get that opportunity.

We note all members of the Directors Guild walked out on our testimony, which we think they might have found of some interest and, therefore, we really appreciate this opportunity.

Senator LEAHY. I should point out in that regard they asked me if I wanted them to stay. I said there would not be a chance to do a followup but they would have a full transcript of not only their own testimony but yours as well, just as you would have a full transcript available, and it was with that assurance they left.

I want to hasten to add they were also told that they would not be able to testify again after you did, as you were able to testify after them. So blame me, don't blame them.

Mr. MAYER. In any event, we do appreciate this opportunity because we think our story is not given in total.

Mr. YOUNG. I would like to echo Mr. Mayer's feelings and thank you very much for this opportunity.

Senator LEAHY. Thank you.
Mr. Word.
Mr. WORD. I would like to thank you also.

Senator LEAHY. We will take a 3-minute recess before the next witness.

[A short recess was taken.]

Senator LEAHY. The committee and the audience will come to order.

Our next witness is Paul Goldstein, who is professor of law at Stanford University.

Professor Goldstein, the floor is all yours.

STATEMENT OF PAUL GOLDSTEIN, STELLA W. AND IRA S.

LILLICK PROFESSOR OF LAW, STANFORD UNIVERSITY Mr. GOLDSTEIN. Thank you, Senator Leahy.

My name is Paul Goldstein. I am professor of law at Stanford University. I am pleased to be here to testify on the intellectual property aspects of motion picture colorization.

With your permission, I would like to submit my prepared statement for the record and to summarize its contents in my oral testimony.

Senator LEAHY. Without objection. And I should note also for the record that the record will remain open for questions to be submitted by not only the chairman but by other members of the committee subsequently.

Go ahead, Mr. Goldstein.

Mr. GOLDSTEIN. I should add that, in testifying before you today, I am speaking strictly for myself and not on behalf, or to my knowledge in the interest of, any present client.

The past several years have demonstrated, and the recent formation of your subcommittee attests, that new information technologies often raise hard questions about the proper role of intellectual property law. If anything, the experience of these past years demonstrates that Congress responds most effectively to these questions when it attends most closely to the principles that have traditionally shaped this country's intellectual property systems.

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The present controversy over colorization of black-and-white pictures implicates three traditional copyright principles: authorship, consumer choice, and producer control. In my judgment, the principle of authorship supports the grant of copyright protection to colorized versions of black-and-white motion pictures; the principle of consumer choice further supports the grant of protection; and the principle of producer control adequately secures producers against the unauthorized colorization of black-and-white motion pictures. My testimony will touch briefly on each of these three principles.

First, authorship. The concept of authorship lies at the heart of copyright law. Copyright encourages authors to invest their time and money in making original contributions by promising them property rights in the resulting works. And copyright recognizes that authorship is inevitably a continuous phenomenon. No author, however creative, can escape the need to draw on the work of earlier authors.

Just to take two examples, the motion pictures, “The Maltese Falcon” and “It's A Wonderful Life”-original works in their own right-draw part of their genius from earlier copyrighted works.

Copyright recognizes that even a midget standing on the shoulders of a giant can see farther than the giant. Copyright rewards not only the creator of the first work, but also the creators of the successive works that build on it. In a strictly legal sense, colorized versions of black-and-white motion pictures are no different from motion picture versions of stories and novels. And under traditional principles, they are no less entitled to copyright protection.

Second, consumer choice. Copyright law has consistently refused to play the role of cultural arbiter. So long as some degree of authorship is evident, copyright will protect the lowest, most common, works alongside the most exalted. This prudent rule rests in part on first amendment traditions that caution against discriminating on the basis of transient or elitist notions of artistic worth. More fundamentally, though, this rule rests upon the principle that the purpose of copyright is not to reward authors as an end in itself, but rather to encourage authors to produce those works that consumers want.

The colorization of black-and-white motion pictures serves this purpose well, making classic motion pictures accessible for the first time to audiences—their tastes shaped by a world of living colorthat would otherwise be disinclined to view them and, because of market forces, might never be able to see these films in any form on television.

Third, the principle of producer control. At the very core of the current debate over the colorization of black-and-white motion pictures lies a concern for authenticity. Conceptually, the concern over colorization differs little from the concern, recently expressed in some quarters, that the restoration of the Sistine Ceiling in the Vatican will mutilate that work rather than restore it to its authentic form. To be sure, the concern over colorization is less pressing. While there is only one Sistine Ceiling-which will be ruined or restored, depending on one's point of view—colorized and blackand-white versions can exist side by side. But this difference raises the more subtle problem of the original author's possible interest in seeing that only the original authentic version of his work is

available, unclouded by other works that may distort his artistic vision.

Authenticity is an important and highly prized cultural value, one that public policy in this country has implemented through such measures as landmark preservation. Copyright law, too, secures the author's interest in authenticity. By giving copyright owners control over their works, including the exclusive right to reproduce and prepare derivative works based on them, copyright effectively gives motion picture producers the right to stop others from colorizing their works or, if the producer chooses, to authorize colorization under tightly controlled conditions, or to impose no conditions at all.

Motion picture directors should be just as free to negotiate with their producers and with production companies to give away or to retain the right to colorize their works. Obviously, in some cases, the decision to retain the right to colorize might result in the director receiving less compensation than he or she otherwise would.

But what of copyrighted works already created, and contracts already entered into, before anyone contemplated the colorization process? Does a contract granting the general right to make derivative works based on a black-and-white motion picture include the right to colorize the motion picture? The question, though important, is not one for Congress to answer. Rather it is to be answered by courts interpreting contracts under the canons of State law. These decisions will inevitably turn on the facts of a particular case. But it would not be surprising to see a court hold that the implied obligation of good faith between contracting parties includes an obligation respecting authenticity and requires, at the least, that the colorizer label his product as a colorized version of a black-and-white original.

This remedy-labeling-which, Senator Leahy, you raised with the preceeding panel, might also be applicable to another category of works.

Senator LEAHY. Let me interject on that.

You are saying that current law may well require that colorizers note when changes are made to derivative works without the original directors' approval

Mr. GOLDSTEIN. There are two possible sources of such a rule. One, as I indicated, is the contract route. If the contract does not preclude colorization, that is the end of it. The other source is tort law. A prominent example would be section 43(a) of the Lanham Act, which proscribes false representations respecting goods and services. Again, a labeling remedy is not an unusual remedy. That might be the source of a rule requiring a colorizer to label a work as not being the original product.

Senator LEAHY. Do you think there is anything in current law that would require compensation to the directors or the actors?

Mr. GOLDSTEIN. None at all.
Senator LEAHY. Do you think Congress should require that?

Mr. GOLDSTEIN. Let me separate the political judgment from a legal and policy judgment.

Senator LEAHY. We do that all the time.
Mr. GOLDSTEIN. Let me give it a try.
Senator LEAHY. With Olympian detachment.

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Mr. GOLDSTEIN. That is exactly what I am going to try for.

Speaking strictly as one who views the copyright system in the round, I think it would be a serious mistake to attempt any system of forced compensation that contradicted two of the essential premises of copyright.

One premise underlies the specific exclusive rights found in section 106. Implicit in section 106's grant of rights is that the copyright owner has the right to convey away these rights.

We have, then, a system of property and freedom of contract, and this system has, with very few exceptions, worked well for the copyright system. It seems to me that the kind of suggestion you are making would run up against that.

Senator LEAHY. Let's go to point 2. Rescinding from the possibility that this remedy may be available in tort law, what about the Congress requiring in effect something like a Surgeon General's warning-a warning or a notice or a disclaimer saying that a work was colored without the original director's approval, or maybe even with the original director's disapproval?

Mr. GOLDSTEIN. That might be entirely appropriate. Congress has already enacted a provision, section 43(a) of the Lanham Act, that does much the same thing.

Senator LEAHY. Please continue.

Mr. GOLDSTEIN. That is really the sum of my remarks. I will just summarize the rest of my testimony.

Briefly, the copyright principles of authorship and consumer choice support copyright protection for colorized films. The copyright principle of producer control supports contractual arrangements protecting against colorization of black-and-white films. For contracts already made for black-and-white films in public domain, producers must look to State rules of contract interpretation, and Federal and State tort rules, to secure their interests in authenticity.

[The statement of Mr. Goldstein follows:]

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