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<PRE>[DOCID: f:h2281enr.txt]
        H.R.2281

                       One Hundred Fifth Congress

                                 of the

                        United States of America


                          AT THE SECOND SESSION

          Begun and held at the City of Washington on Tuesday,
the twenty-seventh day of January, one thousand nine hundred and ninety-
                                  eight


                                 An Act


 
     To amend title 17, United States Code, to implement the World 
Intellectual Property Organization Copyright Treaty and Performances and 
               Phonograms Treaty, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Digital Millennium Copyright Act''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.

                  TITLE I--WIPO TREATIES IMPLEMENTATION

Sec. 101. Short title.
Sec. 102. Technical amendments.
Sec. 103. Copyright protection systems and copyright management 
          information.
Sec. 104. Evaluation of impact of copyright law and amendments on 
          electronic commerce and technological development.
Sec. 105. Effective date.

      TITLE II--ONLINE COPYRIGHT INFRINGEMENT LIABILITY LIMITATION

Sec. 201. Short title.
Sec. 202. Limitations on liability for copyright infringement.
Sec. 203. Effective date.

      TITLE III--COMPUTER MAINTENANCE OR REPAIR COPYRIGHT EXEMPTION

Sec. 301. Short title.
Sec. 302. Limitations on exclusive rights; computer programs.

                   TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Provisions Relating to the Commissioner of Patents and 
          Trademarks and the Register of Copyrights.
Sec. 402. Ephemeral recordings.
Sec. 403. Limitations on exclusive rights; distance education.
Sec. 404. Exemption for libraries and archives.
Sec. 405. Scope of exclusive rights in sound recordings; ephemeral 
          recordings.
Sec. 406. Assumption of contractual obligations related to transfers of 
          rights in motion pictures.
Sec. 407. Effective date.

             TITLE V--PROTECTION OF CERTAIN ORIGINAL DESIGNS

Sec. 501. Short title.
Sec. 502. Protection of certain original designs.
Sec. 503. Conforming amendments.
Sec. 504. Joint study of the effect of this title.
Sec. 505. Effective date.

                 TITLE I--WIPO TREATIES IMPLEMENTATION

SEC. 101. SHORT TITLE.

    This title may be cited as the ``WIPO Copyright and Performances 
and Phonograms Treaties Implementation Act of 1998''.

SEC. 102. TECHNICAL AMENDMENTS.

    (a) Definitions.--Section 101 of title 17, United States Code, is 
amended--
        (1) by striking the definition of ``Berne Convention work'';
        (2) in the definition of ``The `country of origin' of a Berne 
    Convention work''--
            (A) by striking ``The `country of origin' of a Berne 
        Convention work, for purposes of section 411, is the United 
        States if'' and inserting ``For purposes of section 411, a work 
        is a `United States work' only if'';
            (B) in paragraph (1)--
                (i) in subparagraph (B) by striking ``nation or nations 
            adhering to the Berne Convention'' and inserting ``treaty 
            party or parties'';
                (ii) in subparagraph (C) by striking ``does not adhere 
            to the Berne Convention'' and inserting ``is not a treaty 
            party''; and
                (iii) in subparagraph (D) by striking ``does not adhere 
            to the Berne Convention'' and inserting ``is not a treaty 
            party''; and
            (C) in the matter following paragraph (3) by striking ``For 
        the purposes of section 411, the `country of origin' of any 
        other Berne Convention work is not the United States.'';
        (3) by inserting after the definition of ``fixed'' the 
    following:
        ``The `Geneva Phonograms Convention' is the Convention for the 
    Protection of Producers of Phonograms Against Unauthorized 
    Duplication of Their Phonograms, concluded at Geneva, Switzerland, 
    on October 29, 1971.'';
        (4) by inserting after the definition of ``including'' the 
    following:
        ``An `international agreement' is--
            ``(1) the Universal Copyright Convention;
            ``(2) the Geneva Phonograms Convention;
            ``(3) the Berne Convention;
            ``(4) the WTO Agreement;
            ``(5) the WIPO Copyright Treaty;
            ``(6) the WIPO Performances and Phonograms Treaty; and
            ``(7) any other copyright treaty to which the United States 
        is a party.'';
        (5) by inserting after the definition of ``transmit'' the 
    following:
        ``A `treaty party' is a country or intergovernmental 
    organization other than the United States that is a party to an 
    international agreement.'';
        (6) by inserting after the definition of ``widow'' the 
    following:
        ``The `WIPO Copyright Treaty' is the WIPO Copyright Treaty 
    concluded at Geneva, Switzerland, on December 20, 1996.'';
        (7) by inserting after the definition of ``The `WIPO Copyright 
    Treaty''' the following:
        ``The `WIPO Performances and Phonograms Treaty' is the WIPO 
    Performances and Phonograms Treaty concluded at Geneva, 
    Switzerland, on December 20, 1996.''; and
        (8) by inserting after the definition of ``work made for hire'' 
    the following:
        ``The terms `WTO Agreement' and `WTO member country' have the 
    meanings given those terms in paragraphs (9) and (10), 
    respectively, of section 2 of the Uruguay Round Agreements Act.''.
    (b) Subject Matter of Copyright; National Origin.--Section 104 of 
title 17, United States Code, is amended--
        (1) in subsection (b)--
            (A) in paragraph (1) by striking ``foreign nation that is a 
        party to a copyright treaty to which the United States is also 
        a party'' and inserting ``treaty party'';
            (B) in paragraph (2) by striking ``party to the Universal 
        Copyright Convention'' and inserting ``treaty party'';
            (C) by redesignating paragraph (5) as paragraph (6);
            (D) by redesignating paragraph (3) as paragraph (5) and 
        inserting it after paragraph (4);
            (E) by inserting after paragraph (2) the following:
        ``(3) the work is a sound recording that was first fixed in a 
    treaty party; or'';
            (F) in paragraph (4) by striking ``Berne Convention work'' 
        and inserting ``pictorial, graphic, or sculptural work that is 
        incorporated in a building or other structure, or an 
        architectural work that is embodied in a building and the 
        building or structure is located in the United States or a 
        treaty party''; and
            (G) by inserting after paragraph (6), as so redesignated, 
        the following:
``For purposes of paragraph (2), a work that is published in the United 
States or a treaty party within 30 days after publication in a foreign 
nation that is not a treaty party shall be considered to be first 
published in the United States or such treaty party, as the case may 
be.''; and
        (2) by adding at the end the following new subsection:
    ``(d) Effect of Phonograms Treaties.--Notwithstanding the 
provisions of subsection (b), no works other than sound recordings 
shall be eligible for protection under this title solely by virtue of 
the adherence of the United States to the Geneva Phonograms Convention 
or the WIPO Performances and Phonograms Treaty.''.
    (c) Copyright in Restored Works.--Section 104A(h) of title 17, 
United States Code, is amended--
        (1) in paragraph (1), by striking subparagraphs (A) and (B) and 
    inserting the following:
            ``(A) a nation adhering to the Berne Convention;
            ``(B) a WTO member country;
            ``(C) a nation adhering to the WIPO Copyright Treaty;
            ``(D) a nation adhering to the WIPO Performances and 
        Phonogram
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s Treaty; or
            ``(E) subject to a Presidential proclamation under 
        subsection (g).'';
        (2) by amending paragraph (3) to read as follows:
        ``(3) The term `eligible country' means a nation, other than 
    the United States, that--
            ``(A) becomes a WTO member country after the date of the 
        enactment of the Uruguay Round Agreements Act;
            ``(B) on such date of enactment is, or after such date of 
        enactment becomes, a nation adhering to the Berne Convention;
            ``(C) adheres to the WIPO Copyright Treaty;
            ``(D) adheres to the WIPO Performances and Phonograms 
        Treaty; or
            ``(E) after such date of enactment becomes subject to a 
        proclamation under subsection (g).'';
        (3) in paragraph (6)--
            (A) in subparagraph (C)(iii) by striking ``and'' after the 
        semicolon;
            (B) at the end of subparagraph (D) by striking the period 
        and inserting ``; and''; and
            (C) by adding after subparagraph (D) the following:
            ``(E) if the source country for the work is an eligible 
        country solely by virtue of its adherence to the WIPO 
        Performances and Phonograms Treaty, is a sound recording.'';
        (4) in paragraph (8)(B)(i)--
            (A) by inserting ``of which'' before ``the majority''; and
            (B) by striking ``of eligible countries''; and
        (5) by striking paragraph (9).
    (d) Registration and Infringement Actions.--Section 411(a) of title 
17, United States Code, is amended in the first sentence--
        (1) by striking ``actions for infringement of copyright in 
    Berne Convention works whose country of origin is not the United 
    States and''; and
        (2) by inserting ``United States'' after ``no action for 
    infringement of the copyright in any''.
    (e) Statute of Limitations.--Section 507(a) of title 17, United 
State Code, is amended by striking ``No'' and inserting ``Except as 
expressly provided otherwise in this title, no''.

SEC. 103. COPYRIGHT PROTECTION SYSTEMS AND COPYRIGHT MANAGEMENT 
              INFORMATION.

    (a) In General.--Title 17, United States Code, is amended by adding 
at the end the following new chapter:

       ``CHAPTER 12--COPYRIGHT PROTECTION AND MANAGEMENT SYSTEMS

``Sec.
``1201. Circumvention of copyright protection systems.
``1202. Integrity of copyright management information.
``1203. Civil remedies.
``1204. Criminal offenses and penalties.
``1205. Savings clause.

``Sec. 1201. Circumvention of copyright protection systems

    ``(a) Violations Regarding Circumvention of Technological 
Measures.--(1)(A) No person shall circumvent a technological measure 
that effectively controls access to a work protected under this title. 
The prohibition contained in the preceding sentence shall take effect 
at the end of the 2-year period beginning on the date of the enactment 
of this chapter.
    ``(B) The prohibition contained in subparagraph (A) shall not apply 
to persons who are users of a copyrighted work which is in a particular 
class of works, if such persons are, or are likely to be in the 
succeeding 3-year period, adversely affected by virtue of such 
prohibition in their ability to make noninfringing uses of that 
particular class of works under this title, as determined under 
subparagraph (C).
    ``(C) During the 2-year period described in subparagraph (A), and 
during each succeeding 3-year period, the Librarian of Congress, upon 
the recommendation of the Register of Copyrights, who shall consult 
with the Assistant Secretary for Communications and Information of the 
Department of Commerce and report and comment on his or her views in 
making such recommendation, shall make the determination in a 
rulemaking proceeding on the record for purposes of subparagraph (B) of 
whether persons who are users of a copyrighted work are, or are likely 
to be in the succeeding 3-year period, adversely affected by the 
prohibition under subparagraph (A) in their ability to make 
noninfringing uses under this title of a particular class of 
copyrighted works. In conducting such rulemaking, the Librarian shall 
examine--
        ``(i) the availability for use of copyrighted works;
        ``(ii) the availability for use of works for nonprofit 
    archival, preservation, and educational purposes;
        ``(iii) the impact that the prohibition on the circumvention of 
    technological measures applied to copyrighted works has on 
    criticism, comment, news reporting, teaching, scholarship, or 
    research;
        ``(iv) the effect of circumvention of technological measures on 
    the market for or value of copyrighted works; and
        ``(v) such other factors as the Librarian considers 
    appropriate.
    ``(D) The Librarian shall publish any class of copyrighted works 
for which the Librarian has determined, pursuant to the rulemaking 
conducted under subparagraph (C), that noninfringing uses by persons 
who are users of a copyrighted work are, or are likely to be, adversely 
affected, and the prohibition contained in subparagraph (A) shall not 
apply to such users with respect to such class of works for the ensuing 
3-year period.
    ``(E) Neither the exception under subparagraph (B) from the 
applicability of the prohibition contained in subparagraph (A), nor any 
determination made in a rulemaking conducted under subparagraph (C), 
may be used as a defense in any action to enforce any provision of this 
title other than this paragraph.
    ``(2) No person shall manufacture, import, offer to the public, 
provide, or otherwise traffic in any technology, product, service, 
device, component, or part thereof, that--
        ``(A) is primarily designed or produced for the purpose of 
    circumventing a technological measure that effectively controls 
    access to a work protected under this title;
        ``(B) has only limited commercially significant purpose or use 
    other than to circumvent a technological measure that effectively 
    controls access to a work protected under this title; or
        ``(C) is marketed by that person or another acting in concert 
    with that person with that person's knowledge for use in 
    circumventing a technological measure that effectively controls 
    access to a work protected under this title.
    ``(3) As used in this subsection--
        ``(A) to `circumvent a technological measure' means to 
    descramble a scrambled work, to decrypt an encrypted work, or 
    otherwise to avoid, bypass, remove, deactivate, or impair a 
    technological measure, without the authority of the copyright 
    owner; and
        ``(B) a technological measure `effectively controls access to a 
    work' if the measure, in the ordinary course of its operation, 
    requires the application of information, or a process or a 
    treatment, with the authority of the copyright owner, to gain 
    access to the work.
    ``(b) Additional Violations.--(1) No person shall manufacture, 
import, offer to the public, provide, or otherwise traffic in any 
technology, product, service, device, component, or part thereof, 
that--
        ``(A) is primarily designed or produced for the purpose of 
    circumventing protection afforded by a technological measure that 
    effectively protects a right of a copyright owner under this title 
    in a work or a portion thereof;
        ``(B) has only limited commercially significant purpose or use 
    other than to circumvent protection afforded by a technological 
    measure that effectively protects a right of a copyright owner 
    under this title in a work or a portion thereof; or
        ``(C) is marketed by that person or another acting in concert 
    with that person with that person's knowledge for use in 
    circumventing protection afforded by a technological measure that 
    effectively protects a right of a copyright owner under this title 
    in a work or a portion thereof.
    ``(2) As used in this subsection--
        ``(A) to `circumvent protection afforded by a technological 
    measure' means avoiding
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, bypassing, removing, deactivating, or 
    otherwise impairing a technological measure; and
        ``(B) a technological measure `effectively protects a right of 
    a copyright owner under this title' if the measure, in the ordinary 
    course of its operation, prevents, restricts, or otherwise limits 
    the exercise of a right of a copyright owner under this title.
    ``(c) Other Rights, Etc., Not Affected.--(1) Nothing in this 
section shall affect rights, remedies, limitations, or defenses to 
copyright infringement, including fair use, under this title.
    ``(2) Nothing in this section shall enlarge or diminish vicarious 
or contributory liability for copyright infringement in connection with 
any technology, product, service, device, component, or part thereof.
    ``(3) Nothing in this section shall require that the design of, or 
design and selection of parts and components for, a consumer 
electronics, telecommunications, or computing product provide for a 
response to any particular technological measure, so long as such part 
or component, or the product in which such part or component is 
integrated, does not otherwise fall within the prohibitions of 
subsection (a)(2) or (b)(1).
    ``(4) Nothing in this section shall enlarge or diminish any rights 
of free speech or the press for activities using consumer electronics, 
telecommunications, or computing products.
    ``(d) Exemption for Nonprofit Libraries, Archives, and Educational 
Institutions.--(1) A nonprofit library, archives, or educational 
institution which gains access to a commercially exploited copyrighted 
work solely in order to make a good faith determination of whether to 
acquire a copy of that work for the sole purpose of engaging in conduct 
permitted under this title shall not be in violation of subsection 
(a)(1)(A). A copy of a work to which access has been gained under this 
paragraph--
        ``(A) may not be retained longer than necessary to make such 
    good faith determination; and
        ``(B) may not be used for any other purpose.
    ``(2) The exemption made available under paragraph (1) shall only 
apply with respect to a work when an identical copy of that work is not 
reasonably available in another form.
    ``(3) A nonprofit library, archives, or educational institution 
that willfully for the purpose of commercial advantage or financial 
gain violates paragraph (1)--
        ``(A) shall, for the first offense, be subject to the civil 
    remedies under section 1203; and
        ``(B) shall, for repeated or subsequent offenses, in addition 
    to the civil remedies under section 1203, forfeit the exemption 
    provided under paragraph (1).
    ``(4) This subsection may not be used as a defense to a claim under 
subsection (a)(2) or (b), nor may this subsection permit a nonprofit 
library, archives, or educational institution to manufacture, import, 
offer to the public, provide, or otherwise traffic in any technology, 
product, service, component, or part thereof, which circumvents a 
technological measure.
    ``(5) In order for a library or archives to qualify for the 
exemption under this subsection, the collections of that library or 
archives shall be--
        ``(A) open to the public; or
        ``(B) available not only to researchers affiliated with the 
    library or archives or with the institution of which it is a part, 
    but also to other persons doing research in a specialized field.
    ``(e) Law Enforcement, Intelligence, and Other Government 
Activities.--This section does not prohibit any lawfully authorized 
investigative, protective, information security, or intelligence 
activity of an officer, agent, or employee of the United States, a 
State, or a political subdivision of a State, or a person acting 
pursuant to a contract with the United States, a State, or a political 
subdivision of a State. For purposes of this subsection, the term 
`information security' means activities carried out in order to 
identify and address the vulnerabilities of a government computer, 
computer system, or computer network.
    ``(f) Reverse Engineering.--(1) Notwithstanding the provisions of 
subsection (a)(1)(A), a person who has lawfully obtained the right to 
use a copy of a computer program may circumvent a technological measure 
that effectively controls access to a particular portion of that 
program for the sole purpose of identifying and analyzing those 
elements of the program that are necessary to achieve interoperability 
of an independently created computer program with other programs, and 
that have not previously been readily available to the person engaging 
in the circumvention, to the extent any such acts of identification and 
analysis do not constitute infringement under this title.
    ``(2) Notwithstanding the provisions of subsections (a)(2) and (b), 
a person may develop and employ technological means to circumvent a 
technological measure, or to circumvent protection afforded by a 
technological measure, in order to enable the identification and 
analysis under paragraph (1), or for the purpose of enabling 
interoperability of an independently created computer program with 
other programs, if such means are necessary to achieve such 
interoperability, to the extent that doing so does not constitute 
infringement under this title.
    ``(3) The information acquired through the acts permitted under 
paragraph (1), and the means permitted under paragraph (2), may be made 
available to others if the person referred to in paragraph (1) or (2), 
as the case may be, provides such information or means solely for the 
purpose of enabling interoperability of an independently created 
computer program with other programs, and to the extent that doing so 
does not constitute infringement under this title or violate applicable 
law other than this section.
    ``(4) For purposes of this subsection, the term `interoperability' 
means the ability of computer programs to exchange information, and of 
such programs mutually to use the information which has been exchanged.
    ``(g) Encryption Research.--
        ``(1) Definitions.--For purposes of this subsection--
            ``(A) the term `encryption research' means activities 
        necessary to identify and analyze flaws and vulnerabilities of 
        encryption technologies applied to copyrighted works, if these 
        activities are conducted to advance the state of knowledge in 
        the field of encryption technology or to assist in the 
        development of encryption products; and
            ``(B) the term `encryption technology' means the scrambling 
        and descrambling of information using mathematical formulas or 
        algorithms.
        ``(2) Permissible acts of encryption research.--Notwithstanding 
    the provisions of subsection (a)(1)(A), it is not a violation of 
    that subsection for a person to circumvent a technological measure 
    as applied to a copy, phonorecord, performance, or display of a 
    published work in the course of an act of good faith encryption 
    research if--
            ``(A) the person lawfully obtained the encrypted copy, 
        phonorecord, performance, or display of the published work;
            ``(B) such act is necessary to conduct such encryption 
        research;
            ``(C) the person made a good faith effort to obtain 
        authorization before the circumvention; and
            ``(D) such act does not constitute infringement under this 
        title or a violation of applicable law other than this section, 
        including section 1030 of title 18 and those provisions of 
        title 18 amended by the Computer Fraud and Abuse Act of 1986.
        ``(3) Factors in determining exemption.--In determining whether 
    a person qualifies for the exemption under paragraph (2), the 
    factors to be considered shall include--
            ``(A) whether the information derived from the encryption 
        research was disseminated, and if so, whether it was 
        disseminated in a manner reasonably calculated to advance the 
        state of knowledge or development o
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f encryption technology, 
        versus whether it was disseminated in a manner that facilitates 
        infringement under this title or a violation of applicable law 
        other than this section, including a violation of privacy or 
        breach of security;
            ``(B) whether the person is engaged in a legitimate course 
        of study, is employed, or is appropriately trained or 
        experienced, in the field of encryption technology; and
            ``(C) whether the person provides the copyright owner of 
        the work to which the technological measure is applied with 
        notice of the findings and documentation of the research, and 
        the time when such notice is provided.
        ``(4) Use of technological means for research activities.--
    Notwithstanding the provisions of subsection (a)(2), it is not a 
    violation of that subsection for a person to--
            ``(A) develop and employ technological means to circumvent 
        a technological measure for the sole purpose of that person 
        performing the acts of good faith encryption research described 
        in paragraph (2); and
            ``(B) provide the technological means to another person 
        with whom he or she is working collaboratively for the purpose 
        of conducting the acts of good faith encryption research 
        described in paragraph (2) or for the purpose of having that 
        other person verify his or her acts of good faith encryption 
        research described in paragraph (2).
        ``(5) Report to congress.--Not later than 1 year after the date 
    of the enactment of this chapter, the Register of Copyrights and 
    the Assistant Secretary for Communications and Information of the 
    Department of Commerce shall jointly report to the Congress on the 
    effect this subsection has had on--
            ``(A) encryption research and the development of encryption 
        technology;
            ``(B) the adequacy and effectiveness of technological 
        measures designed to protect copyrighted works; and
            ``(C) protection of copyright owners against the 
        unauthorized access to their encrypted copyrighted works.
    The report shall include legislative recommendations, if any.
    ``(h) Exceptions Regarding Minors.--In applying subsection (a) to a 
component or part, the court may consider the necessity for its 
intended and actual incorporation in a technology, product, service, or 
device, which--
        ``(1) does not itself violate the provisions of this title; and
        ``(2) has the sole purpose to prevent the access of minors to 
    material on the Internet.
    ``(i) Protection of Personally Identifying Information.--
        (1) Circumvention permitted.--Notwithstanding the provisions of 
    subsection (a)(1)(A), it is not a violation of that subsection for 
    a person to circumvent a technological measure that effectively 
    controls access to a work protected under this title, if--
            ``(A) the technological measure, or the work it protects, 
        contains the capability of collecting or disseminating 
        personally identifying information reflecting the online 
        activities of a natural person who seeks to gain access to the 
        work protected;
            ``(B) in the normal course of its operation, the 
        technological measure, or the work it protects, collects or 
        disseminates personally identifying information about the 
        person who seeks to gain access to the work protected, without 
        providing conspicuous notice of such collection or 
        dissemination to such person, and without providing such person 
        with the capability to prevent or restrict such collection or 
        dissemination;
            ``(C) the act of circumvention has the sole effect of 
        identifying and disabling the capability described in 
        subparagraph (A), and has no other effect on the ability of any 
        person to gain access to any work; and
            ``(D) the act of circumvention is carried out solely for 
        the purpose of preventing the collection or dissemination of 
        personally identifying information about a natural person who 
        seeks to gain access to the work protected, and is not in 
        violation of any other law.
        ``(2) Inapplicability to certain technological measures.--This 
    subsection does not apply to a technological measure, or a work it 
    protects, that does not collect or disseminate personally 
    identifying information and that is disclosed to a user as not 
    having or using such capability.
    ``(j) Security Testing.--
        ``(1) Definition.--For purposes of this subsection, the term 
    `security testing' means accessing a computer, computer system, or 
    computer network, solely for the purpose of good faith testing, 
    investigating, or correcting, a security flaw or vulnerability, 
    with the authorization of the owner or operator of such computer, 
    computer system, or computer network.
        ``(2) Permissible acts of security testing.--Notwithstanding 
    the provisions of subsection (a)(1)(A), it is not a violation of 
    that subsection for a person to engage in an act of security 
    testing, if such act does not constitute infringement under this 
    title or a violation of applicable law other than this section, 
    including section 1030 of title 18 and those provisions of title 18 
    amended by the Computer Fraud and Abuse Act of 1986.
        ``(3) Factors in determining exemption.--In determining whether 
    a person qualifies for the exemption under paragraph (2), the 
    factors to be considered shall include--
            ``(A) whether the information derived from the security 
        testing was used solely to promote the security of the owner or 
        operator of such computer, computer system or computer network, 
        or shared directly with the developer of such computer, 
        computer system, or computer network; and
            ``(B) whether the information derived from the security 
        testing was used or maintained in a manner that does not 
        facilitate infringement under this title or a violation of 
        applicable law other than this section, including a violation 
        of privacy or breach of security.
        ``(4) Use of technological means for security testing.--
    Notwithstanding the provisions of subsection (a)(2), it is not a 
    violation of that subsection for a person to develop, produce, 
    distribute or employ technological means for the sole purpose of 
    performing the acts of security testing described in subsection 
    (2), provided such technological means does not otherwise violate 
    section (a)(2).
    ``(k) Certain Analog Devices and Certain Technological Measures.--
        ``(1) Certain analog devices.--
            ``(A) Effective 18 months after the date of the enactment 
        of this chapter, no person shall manufacture, import, offer to 
        the public, provide or otherwise traffic in any--
                ``(i) VHS format analog video cassette recorder unless 
            such recorder conforms to the automatic gain control copy 
            control technology;
                ``(ii) 8mm format analog video cassette camcorder 
            unless such camcorder conforms to the automatic gain 
            control technology;
                ``(iii) Beta format analog video cassette recorder, 
            unless such recorder conforms to the automatic gain control 
            copy control technology, except that this requirement shall 
            not apply until there are 1,000 Beta format analog video 
            cassette recorders sold in the United States in any one 
            calendar year after the date of the enactment of this 
            chapter;
                ``(iv) 8mm format analog video cassette recorder that 
            is not an analog video cassette camcorder, unless such 
            recorder conforms to the automatic gain control copy 
            control technology, 
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except that this requirement shall not 
            apply until there are 20,000 such recorders sold in the 
            United States in any one calendar year after the date of 
            the enactment of this chapter; or
                ``(v) analog video cassette recorder that records using 
            an NTSC format video input and that is not otherwise 
            covered under clauses (i) through (iv), unless such device 
            conforms to the automatic gain control copy control 
            technology.
            ``(B) Effective on the date of the enactment of this 
        chapter, no person shall manufacture, import, offer to the 
        public, provide or otherwise traffic in--
                ``(i) any VHS format analog video cassette recorder or 
            any 8mm format analog video cassette recorder if the design 
            of the model of such recorder has been modified after such 
            date of enactment so that a model of recorder that 
            previously conformed to the automatic gain control copy 
            control technology no longer conforms to such technology; 
            or
                ``(ii) any VHS format analog video cassette recorder, 
            or any 8mm format analog video cassette recorder that is 
            not an 8mm analog video cassette camcorder, if the design 
            of the model of such recorder has been modified after such 
            date of enactment so that a model of recorder that 
            previously conformed to the four-line colorstripe copy 
            control technology no longer conforms to such technology.
        Manufacturers that have not previously manufactured or sold a 
        VHS format analog video cassette recorder, or an 8mm format 
        analog cassette recorder, shall be required to conform to the 
        four-line colorstripe copy control technology in the initial 
        model of any such recorder manufactured after the date of the 
        enactment of this chapter, and thereafter to continue 
        conforming to the four-line colorstripe copy control 
        technology. For purposes of this subparagraph, an analog video 
        cassette recorder `conforms to' the four-line colorstripe copy 
        control technology if it records a signal that, when played 
        back by the playback function of that recorder in the normal 
        viewing mode, exhibits, on a reference display device, a 
        display containing distracting visible lines through portions 
        of the viewable picture.
        ``(2) Certain encoding restrictions.--No person shall apply the 
    automatic gain control copy control technology or colorstripe copy 
    control technology to prevent or limit consumer copying except such 
    copying--
            ``(A) of a single transmission, or specified group of 
        transmissions, of live events or of audiovisual works for which 
        a member of the public has exercised choice in selecting the 
        transmissions, including the content of the transmissions or 
        the time of receipt of such transmissions, or both, and as to 
        which such member is charged a separate fee for each such 
        transmission or specified group of transmissions;
            ``(B) from a copy of a transmission of a live event or an 
        audiovisual work if such transmission is provided by a channel 
        or service where payment is made by a member of the public for 
        such channel or service in the form of a subscription fee that 
        entitles the member of the public to receive all of the 
        programming contained in such channel or service;
            ``(C) from a physical medium containing one or more 
        prerecorded audiovisual works; or
            ``(D) from a copy of a transmission described in 
        subparagraph (A) or from a copy made from a physical medium 
        described in subparagraph (C).
    In the event that a transmission meets both the conditions set 
    forth in subparagraph (A) and those set forth in subparagraph (B), 
    the transmission shall be treated as a transmission described in 
    subparagraph (A).
        ``(3) Inapplicability.--This subsection shall not--
            ``(A) require any analog video cassette camcorder to 
        conform to the automatic gain control copy control technology 
        with respect to any video signal received through a camera 
        lens;
            ``(B) apply to the manufacture, importation, offer for 
        sale, provision of, or other trafficking in, any professional 
        analog video cassette recorder; or
            ``(C) apply to the offer for sale or provision of, or other 
        trafficking in, any previously owned analog video cassette 
        recorder, if such recorder was legally manufactured and sold 
        when new and not subsequently modified in violation of 
        paragraph (1)(B).
        ``(4) Definitions.--For purposes of this subsection:
            ``(A) An `analog video cassette recorder' means a device 
        that records, or a device that includes a function that 
        records, on electromagnetic tape in an analog format the 
        electronic impulses produced by the video and audio portions of 
        a television program, motion picture, or other form of 
        audiovisual work.
            ``(B) An `analog video cassette camcorder' means an analog 
        video cassette recorder that contains a recording function that 
        operates through a camera lens and through a video input that 
        may be connected with a television or other video playback 
        device.
            ``(C) An analog video cassette recorder `conforms' to the 
        automatic gain control copy control technology if it--
                ``(i) detects one or more of the elements of such 
            technology and does not record the motion picture or 
            transmission protected by such technology; or
                ``(ii) records a signal that, when played back, 
            exhibits a meaningfully distorted or degraded display.
            ``(D) The term `professional analog video cassette 
        recorder' means an analog video cassette recorder that is 
        designed, manufactured, marketed, and intended for use by a 
        person who regularly employs such a device for a lawful 
        business or industrial use, including making, performing, 
        displaying, distributing, or transmitting copies of motion 
        pictures on a commercial scale.
            ``(E) The terms `VHS format', `8mm format', `Beta format', 
        `automatic gain control copy control technology', `colorstripe 
        copy control technology', `four-line version of the colorstripe 
        copy control technology', and `NTSC' have the meanings that are 
        commonly understood in the consumer electronics and motion 
        picture industries as of the date of the enactment of this 
        chapter.
        ``(5) Violations.--Any violation of paragraph (1) of this 
    subsection shall be treated as a violation of subsection (b)(1) of 
    this section. Any violation of paragraph (2) of this subsection 
    shall be deemed an `act of circumvention' for the purposes of 
    section 1203(c)(3)(A) of this chapter.

``Sec. 1202. Integrity of copyright management information

    ``(a) False Copyright Management Information.--No person shall 
knowingly and with the intent to induce, enable, facilitate, or conceal 
infringement--
        ``(1) provide copyright management information that is false, 
    or
        ``(2) distribute or import for distribution copyright 
    management information that is false.
    ``(b) Removal or Alteration of Copyright Management Information.--
No person shall, without the authority of the copyright owner or the 
law--
        ``(1) intentionally remove or alter any copyright management 
    information,
        ``(2) distribute or import for distribution copyright 
    management information knowing that the copyright management 
    information has been removed or altered without authority of the 
    copyright owner or the
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 law, or
        ``(3) distribute, import for distribution, or publicly perform 
    works, copies of works, or phonorecords, knowing that copyright 
    management information has been removed or altered without 
    authority of the copyright owner or the law,
knowing, or, with respect to civil remedies under section 1203, having 
reasonable grounds to know, that it will induce, enable, facilitate, or 
conceal an infringement of any right under this title.
    ``(c) Definition.--As used in this section, the term `copyright 
management information' means any of the following information conveyed 
in connection with copies or phonorecords of a work or performances or 
displays of a work, including in digital form, except that such term 
does not include any personally identifying information about a user of 
a work or of a copy, phonorecord, performance, or display of a work:
        ``(1) The title and other information identifying the work, 
    including the information set forth on a notice of copyright.
        ``(2) The name of, and other identifying information about, the 
    author of a work.
        ``(3) The name of, and other identifying information about, the 
    copyright owner of the work, including the information set forth in 
    a notice of copyright.
        ``(4) With the exception of public performances of works by 
    radio and television broadcast stations, the name of, and other 
    identifying information about, a performer whose performance is 
    fixed in a work other than an audiovisual work.
        ``(5) With the exception of public performances of works by 
    radio and television broadcast stations, in the case of an 
    audiovisual work, the name of, and other identifying information 
    about, a writer, performer, or director who is credited in the 
    audiovisual work.
        ``(6) Terms and conditions for use of the work.
        ``(7) Identifying numbers or symbols referring to such 
    information or links to such information.
        ``(8) Such other information as the Register of Copyrights may 
    prescribe by regulation, except that the Register of Copyrights may 
    not require the provision of any information concerning the user of 
    a copyrighted work.
    ``(d) Law Enforcement, Intelligence, and Other Government 
Activities.--This section does not prohibit any lawfully authorized 
investigative, protective, information security, or intelligence 
activity of an officer, agent, or employee of the United States, a 
State, or a political subdivision of a State, or a person acting 
pursuant to a contract with the United States, a State, or a political 
subdivision of a State. For purposes of this subsection, the term 
`information security' means activities carried out in order to 
identify and address the vulnerabilities of a government computer, 
computer system, or computer network.
    ``(e) Limitations on Liability.--
        ``(1) Analog transmissions.--In the case of an analog 
    transmission, a person who is making transmissions in its capacity 
    as a broadcast station, or as a cable system, or someone who 
    provides programming to such station or system, shall not be liable 
    for a violation of subsection (b) if--
            ``(A) avoiding the activity that constitutes such violation 
        is not technically feasible or would create an undue financial 
        hardship on such person; and
            ``(B) such person did not intend, by engaging in such 
        activity, to induce, enable, facilitate, or conceal 
        infringement of a right under this title.
        ``(2) Digital transmissions.--
            ``(A) If a digital transmission standard for the placement 
        of copyright management information for a category of works is 
        set in a voluntary, consensus standard-setting process 
        involving a representative cross-section of broadcast stations 
        or cable systems and copyright owners of a category of works 
        that are intended for public performance by such stations or 
        systems, a person identified in paragraph (1) shall not be 
        liable for a violation of subsection (b) with respect to the 
        particular copyright management information addressed by such 
        standard if--
                ``(i) the placement of such information by someone 
            other than such person is not in accordance with such 
            standard; and
                ``(ii) the activity that constitutes such violation is 
            not intended to induce, enable, facilitate, or conceal 
            infringement of a right under this title.
            ``(B) Until a digital transmission standard has been set 
        pursuant to subparagraph (A) with respect to the placement of 
        copyright management information for a category or works, a 
        person identified in paragraph (1) shall not be liable for a 
        violation of subsection (b) with respect to such copyright 
        management information, if the activity that constitutes such 
        violation is not intended to induce, enable, facilitate, or 
        conceal infringement of a right under this title, and if--
                ``(i) the transmission of such information by such 
            person would result in a perceptible visual or aural 
            degradation of the digital signal; or
                ``(ii) the transmission of such information by such 
            person would conflict with--

                    ``(I) an applicable government regulation relating 
                to transmission of information in a digital signal;
                    ``(II) an applicable industry-wide standard 
                relating to the transmission of information in a 
                digital signal that was adopted by a voluntary 
                consensus standards body prior to the effective date of 
                this chapter; or
                    ``(III) an applicable industry-wide standard 
                relating to the transmission of information in a 
                digital signal that was adopted in a voluntary, 
                consensus standards-setting process open to 
                participation by a representative cross-section of 
                broadcast stations or cable systems and copyright 
                owners of a category of works that are intended for 
                public performance by such stations or systems.

        ``(3) Definitions.--As used in this subsection--
            ``(A) the term `broadcast station' has the meaning given 
        that term in section 3 of the Communications Act of 1934 (47 
        U.S.C. 153); and
            ``(B) the term `cable system' has the meaning given that 
        term in section 602 of the Communications Act of 1934 (47 
        U.S.C. 522).

``Sec. 1203. Civil remedies

    ``(a) Civil Actions.--Any person injured by a violation of section 
1201 or 1202 may bring a civil action in an appropriate United States 
district court for such violation.
    ``(b) Powers of the Court.--In an action brought under subsection 
(a), the court--
        ``(1) may grant temporary and permanent injunctions on such 
    terms as it deems reasonable to prevent or restrain a violation, 
    but in no event shall impose a prior restraint on free speech or 
    the press protected under the 1st amendment to the Constitution;
        ``(2) at any time while an action is pending, may order the 
    impounding, on such terms as it deems reasonable, of any device or 
    product that is in the custody or control of the alleged violator 
    and that the court has reasonable cause to believe was involved in 
    a violation;
        ``(3) may award damages under subsection (c);
        ``(4) in its discretion may allow the recovery of costs by or 
    against any party other than the United States or an officer 
    thereof;
        ``(5) in its discretion may award reasonable attorney's fees to 
    the prevailing party; and
        ``(6) may, as part of a final judgment or decree finding a 
    violation, order the remedial modification or the destruction of 
    any device or pr
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oduct involved in the violation that is in the 
    custody or control of the violator or has been impounded under 
    paragraph (2).
    ``(c) Award of Damages.--
        ``(1) In general.--Except as otherwise provided in this title, 
    a person committing a violation of section 1201 or 1202 is liable 
    for either--
            ``(A) the actual damages and any additional profits of the 
        violator, as provided in paragraph (2), or
            ``(B) statutory damages, as provided in paragraph (3).
        ``(2) Actual damages.--The court shall award to the complaining 
    party the actual damages suffered by the party as a result of the 
    violation, and any profits of the violator that are attributable to 
    the violation and are not taken into account in computing the 
    actual damages, if the complaining party elects such damages at any 
    time before final judgment is entered.
        ``(3) Statutory damages.--(A) At any time before final judgment 
    is entered, a complaining party may elect to recover an award of 
    statutory damages for each violation of section 1201 in the sum of 
    not less than $200 or more than $2,500 per act of circumvention, 
    device, product, component, offer, or performance of service, as 
    the court considers just.
        ``(B) At any time before final judgment is entered, a 
    complaining party may elect to recover an award of statutory 
    damages for each violation of section 1202 in the sum of not less 
    than $2,500 or more than $25,000.
        ``(4) Repeated violations.--In any case in which the injured 
    party sustains the burden of proving, and the court finds, that a 
    person has violated section 1201 or 1202 within 3 years after a 
    final judgment was entered against the person for another such 
    violation, the court may increase the award of damages up to triple 
    the amount that would otherwise be awarded, as the court considers 
    just.
        ``(5) Innocent violations.--
            ``(A) In general.--The court in its discretion may reduce 
        or remit the total award of damages in any case in which the 
        violator sustains the burden of proving, and the court finds, 
        that the violator was not aware and had no reason to believe 
        that its acts constituted a violation.
            ``(B) Nonprofit library, archives, or educational 
        institutions.--In the case of a nonprofit library, archives, or 
        educational institution, the court shall remit damages in any 
        case in which the library, archives, or educational institution 
        sustains the burden of proving, and the court finds, that the 
        library, archives, or educational institution was not aware and 
        had no reason to believe that its acts constituted a violation.

``Sec. 1204. Criminal offenses and penalties

    ``(a) In General.--Any person who violates section 1201 or 1202 
willfully and for purposes of commercial advantage or private financial 
gain--
        ``(1) shall be fined not more than $500,000 or imprisoned for 
    not more than 5 years, or both, for the first offense; and
        ``(2) shall be fined not more than $1,000,000 or imprisoned for 
    not more than 10 years, or both, for any subsequent offense.
    ``(b) Limitation for Nonprofit Library, Archives, or Educational 
Institution.--Subsection (a) shall not apply to a nonprofit library, 
archives, or educational institution.
    ``(c) Statute of Limitations.--No criminal proceeding shall be 
brought under this section unless such proceeding is commenced within 5 
years after the cause of action arose.

``Sec. 1205. Savings clause

    ``Nothing in this chapter abrogates, diminishes, or weakens the 
provisions of, nor provides any defense or element of mitigation in a 
criminal prosecution or civil action under, any Federal or State law 
that prevents the violation of the privacy of an individual in 
connection with the individual's use of the Internet.''.
    (b) Conforming Amendment.--The table of chapters for title 17, 
United States Code, is amended by adding after the item relating to 
chapter 11 the following:

``12. Copyright Protection and Management Systems................1201''.

SEC. 104. EVALUATION OF IMPACT OF COPYRIGHT LAW AND AMENDMENTS ON 
              ELECTRONIC COMMERCE AND TECHNOLOGICAL DEVELOPMENT.

    (a) Evaluation by the Register of Copyrights and the Assistant 
Secretary for Communications and Information.--The Register of 
Copyrights and the Assistant Secretary for Communications and 
Information of the Department of Commerce shall jointly evaluate--
        (1) the effects of the amendments made by this title and the 
    development of electronic commerce and associated technology on the 
    operation of sections 109 and 117 of title 17, United States Code; 
    and
        (2) the relationship between existing and emergent technology 
    and the operation of sections 109 and 117 of title 17, United 
    States Code.
    (b) Report to Congress.--The Register of Copyrights and the 
Assistant Secretary for Communications and Information of the 
Department of Commerce shall, not later than 24 months after the date 
of the enactment of this Act, submit to the Congress a joint report on 
the evaluation conducted under subsection (a), including any 
legislative recommendations the Register and the Assistant Secretary 
may have.

SEC. 105. EFFECTIVE DATE.

    (a) In General.--Except as otherwise provided in this title, this 
title and the amendments made by this title shall take effect on the 
date of the enactment of this Act.
    (b) Amendments Relating to Certain International Agreements.--(1) 
The following shall take effect upon the entry into force of the WIPO 
Copyright Treaty with respect to the United States:
        (A) Paragraph (5) of the definition of ``international 
    agreement'' contained in section 101 of title 17, United States 
    Code, as amended by section 102(a)(4) of this Act.
        (B) The amendment made by section 102(a)(6) of this Act.
        (C) Subparagraph (C) of section 104A(h)(1) of title 17, United 
    States Code, as amended by section 102(c)(1) of this Act.
        (D) Subparagraph (C) of section 104A(h)(3) of title 17, United 
    States Code, as amended by section 102(c)(2) of this Act.
    (2) The following shall take effect upon the entry into force of 
the WIPO Performances and Phonograms Treaty with respect to the United 
States:
        (A) Paragraph (6) of the definition of ``international 
    agreement'' contained in section 101 of title 17, United States 
    Code, as amended by section 102(a)(4) of this Act.
        (B) The amendment made by section 102(a)(7) of this Act.
        (C) The amendment made by section 102(b)(2) of this Act.
        (D) Subparagraph (D) of section 104A(h)(1) of title 17, United 
    States Code, as amended by section 102(c)(1) of this Act.
        (E) Subparagraph (D) of section 104A(h)(3) of title 17, United 
    States Code, as amended by section 102(c)(2) of this Act.
        (F) The amendments made by section 102(c)(3) of this Act.

      TITLE II--ONLINE COPYRIGHT INFRINGEMENT LIABILITY LIMITATION

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Online Copyright Infringement 
Liability Limitation Act''.

SEC. 202. LIMITATIONS ON LIABILITY FOR COPYRIGHT INFRINGEMENT.

    (a) In General.--Chapter 5 of title 17, United States Code, is 
amended by adding after section 511 the following new section:

``Sec. 512. Limitations on liability relating to material online

    ``(a) Transitory Digital Network Communications.--A service 
provider shall not be liable for monetary relief, or, except as 
provided in subsection (j), for injunctive or other equitable relief, 
for infringement of copyright by reason of the provider's transmitting, 
routing, or providing connections for, material through a system or 
network controlled or operated by or for the service provider, or by 
reason of the intermediate and transient storage of that material in 
the course of such transmitting, routing, or providing connections, 
if--
        ``(1) the 
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transmission of the material was initiated by or at 
    the direction of a person other than the service provider;
        ``(2) the transmission, routing, provision of connections, or 
    storage is carried out through an automatic technical process 
    without selection of the material by the service provider;
        ``(3) the service provider does not select the recipients of 
    the material except as an automatic response to the request of 
    another person;
        ``(4) no copy of the material made by the service provider in 
    the course of such intermediate or transient storage is maintained 
    on the system or network in a manner ordinarily accessible to 
    anyone other than anticipated recipients, and no such copy is 
    maintained on the system or network in a manner ordinarily 
    accessible to such anticipated recipients for a longer period than 
    is reasonably necessary for the transmission, routing, or provision 
    of connections; and
        ``(5) the material is transmitted through the system or network 
    without modification of its content.
    ``(b) System Caching.--
        ``(1) Limitation on liability.--A service provider shall not be 
    liable for monetary relief, or, except as provided in subsection 
    (j), for injunctive or other equitable relief, for infringement of 
    copyright by reason of the intermediate and temporary storage of 
    material on a system or network controlled or operated by or for 
    the service provider in a case in which--
            ``(A) the material is made available online by a person 
        other than the service provider;
            ``(B) the material is transmitted from the person described 
        in subparagraph (A) through the system or network to a person 
        other than the person described in subparagraph (A) at the 
        direction of that other person; and
            ``(C) the storage is carried out through an automatic 
        technical process for the purpose of making the material 
        available to users of the system or network who, after the 
        material is transmitted as described in subparagraph (B), 
        request access to the material from the person described in 
        subparagraph (A),
    if the conditions set forth in paragraph (2) are met.
        (2) Conditions.--The conditions referred to in paragraph (1) 
    are that--
            ``(A) the material described in paragraph (1) is 
        transmitted to the subsequent users described in paragraph 
        (1)(C) without modification to its content from the manner in 
        which the material was transmitted from the person described in 
        paragraph (1)(A);
            ``(B) the service provider described in paragraph (1) 
        complies with rules concerning the refreshing, reloading, or 
        other updating of the material when specified by the person 
        making the material available online in accordance with a 
        generally accepted industry standard data communications 
        protocol for the system or network through which that person 
        makes the material available, except that this subparagraph 
        applies only if those rules are not used by the person 
        described in paragraph (1)(A) to prevent or unreasonably impair 
        the intermediate storage to which this subsection applies;
            ``(C) the service provider does not interfere with the 
        ability of technology associated with the material to return to 
        the person described in paragraph (1)(A) the information that 
        would have been available to that person if the material had 
        been obtained by the subsequent users described in paragraph 
        (1)(C) directly from that person, except that this subparagraph 
        applies only if that technology--
                ``(i) does not significantly interfere with the 
            performance of the provider's system or network or with the 
            intermediate storage of the material;
                ``(ii) is consistent with generally accepted industry 
            standard communications protocols; and
                ``(iii) does not extract information from the 
            provider's system or network other than the information 
            that would have been available to the person described in 
            paragraph (1)(A) if the subsequent users had gained access 
            to the material directly from that person;
            ``(D) if the person described in paragraph (1)(A) has in 
        effect a condition that a person must meet prior to having 
        access to the material, such as a condition based on payment of 
        a fee or provision of a password or other information, the 
        service provider permits access to the stored material in 
        significant part only to users of its system or network that 
        have met those conditions and only in accordance with those 
        conditions; and
            ``(E) if the person described in paragraph (1)(A) makes 
        that material available online without the authorization of the 
        copyright owner of the material, the service provider responds 
        expeditiously to remove, or disable access to, the material 
        that is claimed to be infringing upon notification of claimed 
        infringement as described in subsection (c)(3), except that 
        this subparagraph applies only if--
                ``(i) the material has previously been removed from the 
            originating site or access to it has been disabled, or a 
            court has ordered that the material be removed from the 
            originating site or that access to the material on the 
            originating site be disabled; and
                ``(ii) the party giving the notification includes in 
            the notification a statement confirming that the material 
            has been removed from the originating site or access to it 
            has been disabled or that a court has ordered that the 
            material be removed from the originating site or that 
            access to the material on the originating site be disabled.
        ``(c) Information Residing on Systems or Networks At Direction 
    of Users.--
        ``(1) In general.--A service provider shall not be liable for 
    monetary relief, or, except as provided in subsection (j), for 
    injunctive or other equitable relief, for infringement of copyright 
    by reason of the storage at the direction of a user of material 
    that resides on a system or network controlled or operated by or 
    for the service provider, if the service provider--
            ``(A)(i) does not have actual knowledge that the material 
        or an activity using the material on the system or network is 
        infringing;
            ``(ii) in the absence of such actual knowledge, is not 
        aware of facts or circumstances from which infringing activity 
        is apparent; or
            ``(iii) upon obtaining such knowledge or awareness, acts 
        expeditiously to remove, or disable access to, the material;
            ``(B) does not receive a financial benefit directly 
        attributable to the infringing activity, in a case in which the 
        service provider has the right and ability to control such 
        activity; and
            ``(C) upon notification of claimed infringement as 
        described in paragraph (3), responds expeditiously to remove, 
        or disable access to, the material that is claimed to be 
        infringing or to be the subject of infringing activity.
        ``(2) Designated agent.--The limitations on liability 
    established in this subsection apply to a service provider only if 
    the service provider has designated an agent to receive 
    notifications of claimed infringement described in paragraph (3), 
    by making available through its service, including on its website 
    in a location accessible to the public, and by providing to the 
    Copyright Office, substantially the following information:
            ``(A) the name, address, phone number, and ele
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ctronic mail 
        address of the agent.
            ``(B) other contact information which the Register of 
        Copyrights may deem appropriate.
    The Register of Copyrights shall maintain a current directory of 
    agents available to the public for inspection, including through 
    the Internet, in both electronic and hard copy formats, and may 
    require payment of a fee by service providers to cover the costs of 
    maintaining the directory.
        ``(3) Elements of notification.--
            ``(A) To be effective under this subsection, a notification 
        of claimed infringement must be a written communication 
        provided to the designated agent of a service provider that 
        includes substantially the following:
                ``(i) A physical or electronic signature of a person 
            authorized to act on behalf of the owner of an exclusive 
            right that is allegedly infringed.
                ``(ii) Identification of the copyrighted work claimed 
            to have been infringed, or, if multiple copyrighted works 
            at a single online site are covered by a single 
            notification, a representative list of such works at that 
            site.
                ``(iii) Identification of the material that is claimed 
            to be infringing or to be the subject of infringing 
            activity and that is to be removed or access to which is to 
            be disabled, and information reasonably sufficient to 
            permit the service provider to locate the material.
                ``(iv) Information reasonably sufficient to permit the 
            service provider to contact the complaining party, such as 
            an address, telephone number, and, if available, an 
            electronic mail address at which the complaining party may 
            be contacted.
                ``(v) A statement that the complaining party has a good 
            faith belief that use of the material in the manner 
            complained of is not authorized by the copyright owner, its 
            agent, or the law.
                ``(vi) A statement that the information in the 
            notification is accurate, and under penalty of perjury, 
            that the complaining party is authorized to act on behalf 
            of the owner of an exclusive right that is allegedly 
            infringed.
            ``(B)(i) Subject to clause (ii), a notification from a 
        copyright owner or from a person authorized to act on behalf of 
        the copyright owner that fails to comply substantially with the 
        provisions of subparagraph (A) shall not be considered under 
        paragraph (1)(A) in determining whether a service provider has 
        actual knowledge or is aware of facts or circumstances from 
        which infringing activity is apparent.
            ``(ii) In a case in which the notification that is provided 
        to the service provider's designated agent fails to comply 
        substantially with all the provisions of subparagraph (A) but 
        substantially complies with clauses (ii), (iii), and (iv) of 
        subparagraph (A), clause (i) of this subparagraph applies only 
        if the service provider promptly attempts to contact the person 
        making the notification or takes other reasonable steps to 
        assist in the receipt of notification that substantially 
        complies with all the provisions of subparagraph (A).
    ``(d) Information Location Tools.--A service provider shall not be 
liable for monetary relief, or, except as provided in subsection (j), 
for injunctive or other equitable relief, for infringement of copyright 
by reason of the provider referring or linking users to an online 
location containing infringing material or infringing activity, by 
using information location tools, including a directory, index, 
reference, pointer, or hypertext link, if the service provider--
        ``(1)(A) does not have actual knowledge that the material or 
    activity is infringing;
        ``(B) in the absence of such actual knowledge, is not aware of 
    facts or circumstances from which infringing activity is apparent; 
    or
        ``(C) upon obtaining such knowledge or awareness, acts 
    expeditiously to remove, or disable access to, the material;
        ``(2) does not receive a financial benefit directly 
    attributable to the infringing activity, in a case in which the 
    service provider has the right and ability to control such 
    activity; and
        ``(3) upon notification of claimed infringement as described in 
    subsection (c)(3), responds expeditiously to remove, or disable 
    access to, the material that is claimed to be infringing or to be 
    the subject of infringing activity, except that, for purposes of 
    this paragraph, the information described in subsection 
    (c)(3)(A)(iii) shall be identification of the reference or link, to 
    material or activity claimed to be infringing, that is to be 
    removed or access to which is to be disabled, and information 
    reasonably sufficient to permit the service provider to locate that 
    reference or link.
    ``(e) Limitation on liability of nonprofit educational 
institutions.--(1) When a public or other nonprofit institution of 
higher education is a service provider, and when a faculty member or 
graduate student who is an employee of such institution is performing a 
teaching or research function, for the purposes of subsections (a) and 
(b) such faculty member or graduate student shall be considered to be a 
person other than the institution, and for the purposes of subsections 
(c) and (d) such faculty member's or graduate student's knowledge or 
awareness of his or her infringing activities shall not be attributed 
to the institution, if--
        ``(A) such faculty member's or graduate student's infringing 
    activities do not involve the provision of online access to 
    instructional materials that are or were required or recommended, 
    within the preceding 3-year period, for a course taught at the 
    institution by such faculty member or graduate student;
        ``(B) the institution has not, within the preceding 3-year 
    period, received more than two notifications described in 
    subsection (c)(3) of claimed infringement by such faculty member or 
    graduate student, and such notifications of claimed infringement 
    were not actionable under subsection (f); and
        ``(C) the institution provides to all users of its system or 
    network informational materials that accurately describe, and 
    promote compliance with, the laws of the United States relating to 
    copyright.
    ``(2) Injunctions.--For the purposes of this subsection, the 
limitations on injunctive relief contained in subsections (j)(2) and 
(j)(3), but not those in (j)(1), shall apply.
    ``(f) Misrepresentations.--Any person who knowingly materially 
misrepresents under this section--
        ``(1) that material or activity is infringing, or
        ``(2) that material or activity was removed or disabled by 
    mistake or misidentification,
 shall be liable for any damages, including costs and attorneys' fees, 
incurred by the alleged infringer, by any copyright owner or copyright 
owner's authorized licensee, or by a service provider, who is injured 
by such misrepresentation, as the result of the service provider 
relying upon such misrepresentation in removing or disabling access to 
the material or activity claimed to be infringing, or in replacing the 
removed material or ceasing to disable access to it.
    ``(g) Replacement of Removed or Disabled Material and Limitation on 
Other Liability.--
        ``(1) No liability for taking down generally.--Subject to 
    paragraph (2), a service provider shall not be liable to any person 
    for any claim based on the service provider's good faith disabling 
    of access to, or removal of, material or activity claimed to be 
    infringing or based on facts or circumstances from which infringing 
    activity is apparent, regardless of whether the m
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aterial or 
    activity is ultimately determined to be infringing.
        ``(2) Exception.--Paragraph (1) shall not apply with respect to 
    material residing at the direction of a subscriber of the service 
    provider on a system or network controlled or operated by or for 
    the service provider that is removed, or to which access is 
    disabled by the service provider, pursuant to a notice provided 
    under subsection (c)(1)(C), unless the service provider--
            ``(A) takes reasonable steps promptly to notify the 
        subscriber that it has removed or disabled access to the 
        material;
            ``(B) upon receipt of a counter notification described in 
        paragraph (3), promptly provides the person who provided the 
        notification under subsection (c)(1)(C) with a copy of the 
        counter notification, and informs that person that it will 
        replace the removed material or cease disabling access to it in 
        10 business days; and
            ``(C) replaces the removed material and ceases disabling 
        access to it not less than 10, nor more than 14, business days 
        following receipt of the counter notice, unless its designated 
        agent first receives notice from the person who submitted the 
        notification under subsection (c)(1)(C) that such person has 
        filed an action seeking a court order to restrain the 
        subscriber from engaging in infringing activity relating to the 
        material on the service provider's system or network.
        ``(3) Contents of counter notification.--To be effective under 
    this subsection, a counter notification must be a written 
    communication provided to the service provider's designated agent 
    that includes substantially the following:
            ``(A) A physical or electronic signature of the subscriber.
            ``(B) Identification of the material that has been removed 
        or to which access has been disabled and the location at which 
        the material appeared before it was removed or access to it was 
        disabled.
            ``(C) A statement under penalty of perjury that the 
        subscriber has a good faith belief that the material was 
        removed or disabled as a result of mistake or misidentification 
        of the material to be removed or disabled.
            ``(D) The subscriber's name, address, and telephone number, 
        and a statement that the subscriber consents to the 
        jurisdiction of Federal District Court for the judicial 
        district in which the address is located, or if the 
        subscriber's address is outside of the United States, for any 
        judicial district in which the service provider may be found, 
        and that the subscriber will accept service of process from the 
        person who provided notification under subsection (c)(1)(C) or 
        an agent of such person.
        ``(4) Limitation on other liability.--A service provider's 
    compliance with paragraph (2) shall not subject the service 
    provider to liability for copyright infringement with respect to 
    the material identified in the notice provided under subsection 
    (c)(1)(C).
    ``(h) Subpoena To Identify Infringer.--
        ``(1) Request.--A copyright owner or a person authorized to act 
    on the owner's behalf may request the clerk of any United States 
    district court to issue a subpoena to a service provider for 
    identification of an alleged infringer in accordance with this 
    subsection.
        ``(2) Contents of request.--The request may be made by filing 
    with the clerk--
            ``(A) a copy of a notification described in subsection 
        (c)(3)(A);
            ``(B) a proposed subpoena; and
            ``(C) a sworn declaration to the effect that the purpose 
        for which the subpoena is sought is to obtain the identity of 
        an alleged infringer and that such information will only be 
        used for the purpose of protecting rights under this title.
        ``(3) Contents of subpoena.--The subpoena shall authorize and 
    order the service provider receiving the notification and the 
    subpoena to expeditiously disclose to the copyright owner or person 
    authorized by the copyright owner information sufficient to 
    identify the alleged infringer of the material described in the 
    notification to the extent such information is available to the 
    service provider.
        ``(4) Basis for granting subpoena.--If the notification filed 
    satisfies the provisions of subsection (c)(3)(A), the proposed 
    subpoena is in proper form, and the accompanying declaration is 
    properly executed, the clerk shall expeditiously issue and sign the 
    proposed subpoena and return it to the requester for delivery to 
    the service provider.
        ``(5) Actions of service provider receiving subpoena.--Upon 
    receipt of the issued subpoena, either accompanying or subsequent 
    to the receipt of a notification described in subsection (c)(3)(A), 
    the service provider shall expeditiously disclose to the copyright 
    owner or person authorized by the copyright owner the information 
    required by the subpoena, notwithstanding any other provision of 
    law and regardless of whether the service provider responds to the 
    notification.
        ``(6) Rules applicable to subpoena.--Unless otherwise provided 
    by this section or by applicable rules of the court, the procedure 
    for issuance and delivery of the subpoena, and the remedies for 
    noncompliance with the subpoena, shall be governed to the greatest 
    extent practicable by those provisions of the Federal Rules of 
    Civil Procedure governing the issuance, service, and enforcement of 
    a subpoena duces tecum.
    ``(i) Conditions for Eligibility.--
        ``(1) Accommodation of technology.--The limitations on 
    liability established by this section shall apply to a service 
    provider only if the service provider--
            ``(A) has adopted and reasonably implemented, and informs 
        subscribers and account holders of the service provider's 
        system or network of, a policy that provides for the 
        termination in appropriate circumstances of subscribers and 
        account holders of the service provider's system or network who 
        are repeat infringers; and
            ``(B) accommodates and does not interfere with standard 
        technical measures.
        ``(2) Definition.--As used in this subsection, the term 
    `standard technical measures' means technical measures that are 
    used by copyright owners to identify or protect copyrighted works 
    and--
            ``(A) have been developed pursuant to a broad consensus of 
        copyright owners and service providers in an open, fair, 
        voluntary, multi-industry standards process;
            ``(B) are available to any person on reasonable and 
        nondiscriminatory terms; and
            ``(C) do not impose substantial costs on service providers 
        or substantial burdens on their systems or networks.
    ``(j) Injunctions.--The following rules shall apply in the case of 
any application for an injunction under section 502 against a service 
provider that is not subject to monetary remedies under this section:
        ``(1) Scope of relief.--(A) With respect to conduct other than 
    that which qualifies for the limitation on remedies set forth in 
    subsection (a), the court may grant injunctive relief with respect 
    to a service provider only in one or more of the following forms:
            ``(i) An order restraining the service provider from 
        providing access to infringing material or activity residing at 
        a particular online site on the provider's system or network.
            ``(ii) An order restraining the service provider from 
        providing access to a subscriber or account holder of the 
        service provider's system or network who is engaging in 
        infringing activity and is identified in the order, by 
        terminating the accoun
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ts of the subscriber or account holder 
        that are specified in the order.
            ``(iii) Such other injunctive relief as the court may 
        consider necessary to prevent or restrain infringement of 
        copyrighted material specified in the order of the court at a 
        particular online location, if such relief is the least 
        burdensome to the service provider among the forms of relief 
        comparably effective for that purpose.
        ``(B) If the service provider qualifies for the limitation on 
    remedies described in subsection (a), the court may only grant 
    injunctive relief in one or both of the following forms:
            ``(i) An order restraining the service provider from 
        providing access to a subscriber or account holder of the 
        service provider's system or network who is using the 
        provider's service to engage in infringing activity and is 
        identified in the order, by terminating the accounts of the 
        subscriber or account holder that are specified in the order.
            ``(ii) An order restraining the service provider from 
        providing access, by taking reasonable steps specified in the 
        order to block access, to a specific, identified, online 
        location outside the United States.
        ``(2) Considerations.--The court, in considering the relevant 
    criteria for injunctive relief under applicable law, shall 
    consider--
            ``(A) whether such an injunction, either alone or in 
        combination with other such injunctions issued against the same 
        service provider under this subsection, would significantly 
        burden either the provider or the operation of the provider's 
        system or network;
            ``(B) the magnitude of the harm likely to be suffered by 
        the copyright owner in the digital network environment if steps 
        are not taken to prevent or restrain the infringement;
            ``(C) whether implementation of such an injunction would be 
        technically feasible and effective, and would not interfere 
        with access to noninfringing material at other online 
        locations; and
            ``(D) whether other less burdensome and comparably 
        effective means of preventing or restraining access to the 
        infringing material are available.
        ``(3) Notice and Ex Parte Orders.--Injunctive relief under this 
    subsection shall be available only after notice to the service 
    provider and an opportunity for the service provider to appear are 
    provided, except for orders ensuring the preservation of evidence 
    or other orders having no material adverse effect on the operation 
    of the service provider's communications network.
    ``(k) Definitions.--
        ``(1) Service provider.--(A) As used in subsection (a), the 
    term `service provider' means an entity offering the transmission, 
    routing, or providing of connections for digital online 
    communications, between or among points specified by a user, of 
    material of the user's choosing, without modification to the 
    content of the material as sent or received.
        ``(B) As used in this section, other than subsection (a), the 
    term `service provider' means a provider of online services or 
    network access, or the operator of facilities therefor, and 
    includes an entity described in subparagraph (A).
        ``(2) Monetary relief.--As used in this section, the term 
    `monetary relief' means damages, costs, attorneys' fees, and any 
    other form of monetary payment.
    ``(l) Other Defenses Not Affected.--The failure of a service 
provider's conduct to qualify for limitation of liability under this 
section shall not bear adversely upon the consideration of a defense by 
the service provider that the service provider's conduct is not 
infringing under this title or any other defense.
    ``(m) Protection of Privacy.--Nothing in this section shall be 
construed to condition the applicability of subsections (a) through (d) 
on--
        ``(1) a service provider monitoring its service or 
    affirmatively seeking facts indicating infringing activity, except 
    to the extent consistent with a standard technical measure 
    complying with the provisions of subsection (i); or
        ``(2) a service provider gaining access to, removing, or 
    disabling access to material in cases in which such conduct is 
    prohibited by law.
    ``(n) Construction.--Subsections (a), (b), (c), and (d) describe 
separate and distinct functions for purposes of applying this section. 
Whether a service provider qualifies for the limitation on liability in 
any one of those subsections shall be based solely on the criteria in 
that subsection, and shall not affect a determination of whether that 
service provider qualifies for the limitations on liability under any 
other such subsection.''.
    (b) Conforming Amendment.--The table of sections for chapter 5 of 
title 17, United States Code, is amended by adding at the end the 
following:

``512. Limitations on liability relating to material online.''.

SEC. 203. EFFECTIVE DATE.

    This title and the amendments made by this title shall take effect 
on the date of the enactment of this Act.

     TITLE III--COMPUTER MAINTENANCE OR REPAIR COPYRIGHT EXEMPTION

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Computer Maintenance Competition 
Assurance Act''.

SEC. 302. LIMITATIONS ON EXCLUSIVE RIGHTS; COMPUTER PROGRAMS.

    Section 117 of title 17, United States Code, is amended--
    (1) by striking ``Notwithstanding'' and inserting the following:
    ``(a) Making of Additional Copy or Adaptation by Owner of Copy.--
Notwithstanding'';
    (2) by striking ``Any exact'' and inserting the following:
    ``(b) Lease, Sale, or Other Transfer of Additional Copy or 
Adaptation.--Any exact''; and
    (3) by adding at the end the following:
    ``(c) Machine Maintenance or Repair.--Notwithstanding the 
provisions of section 106, it is not an infringement for the owner or 
lessee of a machine to make or authorize the making of a copy of a 
computer program if such copy is made solely by virtue of the 
activation of a machine that lawfully contains an authorized copy of 
the computer program, for purposes only of maintenance or repair of 
that machine, if--
        ``(1) such new copy is used in no other manner and is destroyed 
    immediately after the maintenance or repair is completed; and
        ``(2) with respect to any computer program or part thereof that 
    is not necessary for that machine to be activated, such program or 
    part thereof is not accessed or used other than to make such new 
    copy by virtue of the activation of the machine.
    ``(d) Definitions.--For purposes of this section--
        ``(1) the `maintenance' of a machine is the servicing of the 
    machine in order to make it work in accordance with its original 
    specifications and any changes to those specifications authorized 
    for that machine; and
        ``(2) the `repair' of a machine is the restoring of the machine 
    to the state of working in accordance with its original 
    specifications and any changes to those specifications authorized 
    for that machine.''.

                   TITLE IV--MISCELLANEOUS PROVISIONS

SEC. 401. PROVISIONS RELATING TO THE COMMISSIONER OF PATENTS AND 
              TRADEMARKS AND THE REGISTER OF COPYRIGHTS

    (a) Compensation.--(1) Section 3(d) of title 35, United States 
Code, is amended by striking ``prescribed by law for Assistant 
Secretaries of Commerce'' and inserting ``in effect for level III of 
the Executive Schedule under section 5314 of title 5, United States 
Code''.
    (2) Section 701(e) of title 17, United States Code, is amended--
        (A) by striking ``IV'' and inserting ``III''; and
        (B) by striking ``5315'' and inserting ``5314''.
    (3) Section 5314 of title 5, United States Code, is amended by 
adding at the end the following:
        ``Assistant Secretary of Commerce and Commissioner of Patents 
    and Trademarks.
        ``Regis
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ter of Copyrights.''.
    (b) Clarification of Authority of the Copyright Office.--Section 
701 of title 17, United States Code, is amended--
        (1) by redesignating subsections (b) through (e) as subsections 
    (c) through (f), respectively; and
        (2) by inserting after subsection (a) the following:
    ``(b) In addition to the functions and duties set out elsewhere in 
this chapter, the Register of Copyrights shall perform the following 
functions:
        ``(1) Advise Congress on national and international issues 
    relating to copyright, other matters arising under this title, and 
    related matters.
        ``(2) Provide information and assistance to Federal departments 
    and agencies and the Judiciary on national and international issues 
    relating to copyright, other matters arising under this title, and 
    related matters.
        ``(3) Participate in meetings of international 
    intergovernmental organizations and meetings with foreign 
    government officials relating to copyright, other matters arising 
    under this title, and related matters, including as a member of 
    United States delegations as authorized by the appropriate 
    Executive branch authority.
        ``(4) Conduct studies and programs regarding copyright, other 
    matters arising under this title, and related matters, the 
    administration of the Copyright Office, or any function vested in 
    the Copyright Office by law, including educational programs 
    conducted cooperatively with foreign intellectual property offices 
    and international intergovernmental organizations.
        ``(5) Perform such other functions as Congress may direct, or 
    as may be appropriate in furtherance of the functions and duties 
    specifically set forth in this title.''.

SEC. 402. EPHEMERAL RECORDINGS.

    Section 112(a) of title 17, United States Code, is amended--
        (1) by redesignating paragraphs (1), (2), and (3) as 
    subparagraphs (A), (B), and (C), respectively;
        (2) by inserting ``(1)'' after ``(a)'';
        (3) by inserting after ``under a license'' the following: ``, 
    including a statutory license under section 114(f),'';
        (4) by inserting after ``114(a),'' the following: ``or for a 
    transmitting organization that is a broadcast radio or television 
    station licensed as such by the Federal Communications Commission 
    and that makes a broadcast transmission of a performance of a sound 
    recording in a digital format on a nonsubscription basis,''; and
        (5) by adding at the end the following:
    ``(2) In a case in which a transmitting organization entitled to 
make a copy or phonorecord under paragraph (1) in connection with the 
transmission to the public of a performance or display of a work is 
prevented from making such copy or phonorecord by reason of the 
application by the copyright owner of technical measures that prevent 
the reproduction of the work, the copyright owner shall make available 
to the transmitting organization the necessary means for permitting the 
making of such copy or phonorecord as permitted under that paragraph, 
if it is technologically feasible and economically reasonable for the 
copyright owner to do so. If the copyright owner fails to do so in a 
timely manner in light of the transmitting organization's reasonable 
business requirements, the transmitting organization shall not be 
liable for a violation of section 1201(a)(1) of this title for engaging 
in such activities as are necessary to make such copies or phonorecords 
as permitted under paragraph (1) of this subsection.''.

SEC. 403. LIMITATIONS ON EXCLUSIVE RIGHTS; DISTANCE EDUCATION.

    (a) Recommendations by Register of Copyrights.--Not later than 6 
months after the date of the enactment of this Act, the Register of 
Copyrights, after consultation with representatives of copyright 
owners, nonprofit educational institutions, and nonprofit libraries and 
archives, shall submit to the Congress recommendations on how to 
promote distance education through digital technologies, including 
interactive digital networks, while maintaining an appropriate balance 
between the rights of copyright owners and the needs of users of 
copyrighted works. Such recommendations shall include any legislation 
the Register of Copyrights considers appropriate to achieve the 
objective described in the preceding sentence.
    (b) Factors.--In formulating recommendations under subsection (a), 
the Register of Copyrights shall consider--
        (1) the need for an exemption from exclusive rights of 
    copyright owners for distance education through digital networks;
        (2) the categories of works to be included under any distance 
    education exemption;
        (3) the extent of appropriate quantitative limitations on the 
    portions of works that may be used under any distance education 
    exemption;
        (4) the parties who should be entitled to the benefits of any 
    distance education exemption;
        (5) the parties who should be designated as eligible recipients 
    of distance education materials under any distance education 
    exemption;
        (6) whether and what types of technological measures can or 
    should be employed to safeguard against unauthorized access to, and 
    use or retention of, copyrighted materials as a condition of 
    eligibility for any distance education exemption, including, in 
    light of developing technological capabilities, the exemption set 
    out in section 110(2) of title 17, United States Code;
        (7) the extent to which the availability of licenses for the 
    use of copyrighted works in distance education through interactive 
    digital networks should be considered in assessing eligibility for 
    any distance education exemption; and
        (8) such other issues relating to distance education through 
    interactive digital networks that the Register considers 
    appropriate.

SEC. 404. EXEMPTION FOR LIBRARIES AND ARCHIVES.

    Section 108 of title 17, United States Code, is amended--
        (1) in subsection (a)--
            (A) by striking ``Notwithstanding'' and inserting ``Except 
        as otherwise provided in this title and notwithstanding'';
            (B) by inserting after ``no more than one copy or 
        phonorecord of a work'' the following: ``, except as provided 
        in subsections (b) and (c)''; and
            (C) in paragraph (3) by inserting after ``copyright'' the 
        following: ``that appears on the copy or phonorecord that is 
        reproduced under the provisions of this section, or includes a 
        legend stating that the work may be protected by copyright if 
        no such notice can be found on the copy or phonorecord that is 
        reproduced under the provisions of this section'';
        (2) in subsection (b)--
            (A) by striking ``a copy or phonorecord'' and inserting 
        ``three copies or phonorecords'';
            (B) by striking ``in facsimile form''; and
            (C) by striking ``if the copy or phonorecord reproduced is 
        currently in the collections of the library or archives.'' and 
        inserting ``if--
        ``(1) the copy or phonorecord reproduced is currently in the 
    collections of the library or archives; and
        ``(2) any such copy or phonorecord that is reproduced in 
    digital format is not otherwise distributed in that format and is 
    not made available to the public in that format outside the 
    premises of the library or archives.''; and
        (3) in subsection (c)--
            (A) by striking ``a copy or phonorecord'' and inserting 
        ``three copies or phonorecords'';
            (B) by striking ``in facsimile form'';
            (C) by inserting ``or if the existing format in which the 
        work is stored has become obsolete,'' after ``stolen,'';
            (D) by striking ``if the library or archives has, after a 
        reasonable effort, determined that an unused replacement cannot 
        be obtained at a fair price.'' and inserting ``if--
        ``(1) the library or archives 
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has, after a reasonable effort, 
    determined that an unused replacement cannot be obtained at a fair 
    price; and
        ``(2) any such copy or phonorecord that is reproduced in 
    digital format is not made available to the public in that format 
    outside the premises of the library or archives in lawful 
    possession of such copy.''; and
            (E) by adding at the end the following:
``For purposes of this subsection, a format shall be considered 
obsolete if the machine or device necessary to render perceptible a 
work stored in that format is no longer manufactured or is no longer 
reasonably available in the commercial marketplace.''.

SEC. 405. SCOPE OF EXCLUSIVE RIGHTS IN SOUND RECORDINGS; EPHEMERAL 
              RECORDINGS.

    (a) Scope of Exclusive Rights in Sound Recordings.--Section 114 of 
title 17, United States Code, is amended as follows:
        (1) Subsection (d) is amended--
            (A) in paragraph (1) by striking subparagraph (A) and 
        inserting the following:
            ``(A) a nonsubscription broadcast transmission;''; and
            (B) by amending paragraph (2) to read as follows:
        ``(2) Statutory licensing of certain transmissions.--The 
    performance of a sound recording publicly by means of a 
    subscription digital audio transmission not exempt under paragraph 
    (1), an eligible nonsubscription transmission, or a transmission 
    not exempt under paragraph (1) that is made by a preexisting 
    satellite digital audio radio service shall be subject to statutory 
    licensing, in accordance with subsection (f) if--
            ``(A)(i) the transmission is not part of an interactive 
        service;
            ``(ii) except in the case of a transmission to a business 
        establishment, the transmitting entity does not automatically 
        and intentionally cause any device receiving the transmission 
        to switch from one program channel to another; and
            ``(iii) except as provided in section 1002(e), the 
        transmission of the sound recording is accompanied, if 
        technically feasible, by the information encoded in that sound 
        recording, if any, by or under the authority of the copyright 
        owner of that sound recording, that identifies the title of the 
        sound recording, the featured recording artist who performs on 
        the sound recording, and related information, including 
        information concerning the underlying musical work and its 
        writer;
            ``(B) in the case of a subscription transmission not exempt 
        under paragraph (1) that is made by a preexisting subscription 
        service in the same transmission medium used by such service on 
        July 31, 1998, or in the case of a transmission not exempt 
        under paragraph (1) that is made by a preexisting satellite 
        digital audio radio service--
                ``(i) the transmission does not exceed the sound 
            recording performance complement; and
                ``(ii) the transmitting entity does not cause to be 
            published by means of an advance program schedule or prior 
            announcement the titles of the specific sound recordings or 
            phonorecords embodying such sound recordings to be 
            transmitted; and
            ``(C) in the case of an eligible nonsubscription 
        transmission or a subscription transmission not exempt under 
        paragraph (1) that is made by a new subscription service or by 
        a preexisting subscription service other than in the same 
        transmission medium used by such service on July 31, 1998--
                ``(i) the transmission does not exceed the sound 
            recording performance complement, except that this 
            requirement shall not apply in the case of a retransmission 
            of a broadcast transmission if the retransmission is made 
            by a transmitting entity that does not have the right or 
            ability to control the programming of the broadcast station 
            making the broadcast transmission, unless--

                    ``(I) the broadcast station makes broadcast 
                transmissions--

                        ``(aa) in digital format that regularly exceed 
                    the sound recording performance complement; or
                        ``(bb) in analog format, a substantial portion 
                    of which, on a weekly basis, exceed the sound 
                    recording performance complement; and

                    ``(II) the sound recording copyright owner or its 
                representative has notified the transmitting entity in 
                writing that broadcast transmissions of the copyright 
                owner's sound recordings exceed the sound recording 
                performance complement as provided in this clause;

                ``(ii) the transmitting entity does not cause to be 
            published, or induce or facilitate the publication, by 
            means of an advance program schedule or prior announcement, 
            the titles of the specific sound recordings to be 
            transmitted, the phonorecords embodying such sound 
            recordings, or, other than for illustrative purposes, the 
            names of the featured recording artists, except that this 
            clause does not disqualify a transmitting entity that makes 
            a prior announcement that a particular artist will be 
            featured within an unspecified future time period, and in 
            the case of a retransmission of a broadcast transmission by 
            a transmitting entity that does not have the right or 
            ability to control the programming of the broadcast 
            transmission, the requirement of this clause shall not 
            apply to a prior oral announcement by the broadcast 
            station, or to an advance program schedule published, 
            induced, or facilitated by the broadcast station, if the 
            transmitting entity does not have actual knowledge and has 
            not received written notice from the copyright owner or its 
            representative that the broadcast station publishes or 
            induces or facilitates the publication of such advance 
            program schedule, or if such advance program schedule is a 
            schedule of classical music programming published by the 
            broadcast station in the same manner as published by that 
            broadcast station on or before September 30, 1998;
                ``(iii) the transmission--

                    ``(I) is not part of an archived program of less 
                than 5 hours duration;
                    ``(II) is not part of an archived program of 5 
                hours or greater in duration that is made available for 
                a period exceeding 2 weeks;
                    ``(III) is not part of a continuous program which 
                is of less than 3 hours duration; or
                    ``(IV) is not part of an identifiable program in 
                which performances of sound recordings are rendered in 
                a predetermined order, other than an archived or 
                continuous program, that is transmitted at--

                        ``(aa) more than 3 times in any 2-week period 
                    that have been publicly announced in advance, in 
                    the case of a program of less than 1 hour in 
                    duration, or
                        ``(bb) more than 4 times in any 2-week period 
                    that have been publicly announced in advance, in 
                    the case of a program of 1 hour or more in 
                    duration,

                except that the requirement of this subclause shall not 
                apply in the case of a retransmission of a broadcast 
                transmission by a transmitting entity that does not 
                have the right or ability to control the programming of 
                the 
2000
broadcast transmission, unless the transmitting 
                entity is given notice in writing by the copyright 
                owner of the sound recording that the broadcast station 
                makes broadcast transmissions that regularly violate 
                such requirement;

                ``(iv) the transmitting entity does not knowingly 
            perform the sound recording, as part of a service that 
            offers transmissions of visual images contemporaneously 
            with transmissions of sound recordings, in a manner that is 
            likely to cause confusion, to cause mistake, or to deceive, 
            as to the affiliation, connection, or association of the 
            copyright owner or featured recording artist with the 
            transmitting entity or a particular product or service 
            advertised by the transmitting entity, or as to the origin, 
            sponsorship, or approval by the copyright owner or featured 
            recording artist of the activities of the transmitting 
            entity other than the performance of the sound recording 
            itself;
                ``(v) the transmitting entity cooperates to prevent, to 
            the extent feasible without imposing substantial costs or 
            burdens, a transmission recipient or any other person or 
            entity from automatically scanning the transmitting 
            entity's transmissions alone or together with transmissions 
            by other transmitting entities in order to select a 
            particular sound recording to be transmitted to the 
            transmission recipient, except that the requirement of this 
            clause shall not apply to a satellite digital audio service 
            that is in operation, or that is licensed by the Federal 
            Communications Commission, on or before July 31, 1998;
                ``(vi) the transmitting entity takes no affirmative 
            steps to cause or induce the making of a phonorecord by the 
            transmission recipient, and if the technology used by the 
            transmitting entity enables the transmitting entity to 
            limit the making by the transmission recipient of 
            phonorecords of the transmission directly in a digital 
            format, the transmitting entity sets such technology to 
            limit such making of phonorecords to the extent permitted 
            by such technology;
                ``(vii) phonorecords of the sound recording have been 
            distributed to the public under the authority of the 
            copyright owner or the copyright owner authorizes the 
            transmitting entity to transmit the sound recording, and 
            the transmitting entity makes the transmission from a 
            phonorecord lawfully made under the authority of the 
            copyright owner, except that the requirement of this clause 
            shall not apply to a retransmission of a broadcast 
            transmission by a transmitting entity that does not have 
            the right or ability to control the programming of the 
            broadcast transmission, unless the transmitting entity is 
            given notice in writing by the copyright owner of the sound 
            recording that the broadcast station makes broadcast 
            transmissions that regularly violate such requirement;
                ``(viii) the transmitting entity accommodates and does 
            not interfere with the transmission of technical measures 
            that are widely used by sound recording copyright owners to 
            identify or protect copyrighted works, and that are 
            technically feasible of being transmitted by the 
            transmitting entity without imposing substantial costs on 
            the transmitting entity or resulting in perceptible aural 
            or visual degradation of the digital signal, except that 
            the requirement of this clause shall not apply to a 
            satellite digital audio service that is in operation, or 
            that is licensed under the authority of the Federal 
            Communications Commission, on or before July 31, 1998, to 
            the extent that such service has designed, developed, or 
            made commitments to procure equipment or technology that is 
            not compatible with such technical measures before such 
            technical measures are widely adopted by sound recording 
            copyright owners; and
                ``(ix) the transmitting entity identifies in textual 
            data the sound recording during, but not before, the time 
            it is performed, including the title of the sound 
            recording, the title of the phonorecord embodying such 
            sound recording, if any, and the featured recording artist, 
            in a manner to permit it to be displayed to the 
            transmission recipient by the device or technology intended 
            for receiving the service provided by the transmitting 
            entity, except that the obligation in this clause shall not 
            take effect until 1 year after the date of the enactment of 
            the Digital Millennium Copyright Act and shall not apply in 
            the case of a retransmission of a broadcast transmission by 
            a transmitting entity that does not have the right or 
            ability to control the programming of the broadcast 
            transmission, or in the case in which devices or technology 
            intended for receiving the service provided by the 
            transmitting entity that have the capability to display 
            such textual data are not common in the marketplace.''.
        (2) Subsection (f) is amended--
            (A) in the subsection heading by striking ``Nonexempt 
        Subscription'' and inserting ``Certain Nonexempt'';
            (B) in paragraph (1)--
                (i) in the first sentence--

                    (I) by striking ``(1) No'' and inserting ``(1)(A) 
                No'';
                    (II) by striking ``the activities'' and inserting 
                ``subscription transmissions by preexisting 
                subscription services and transmissions by preexisting 
                satellite digital audio radio services''; and
                    (III) by striking ``2000'' and inserting ``2001''; 
                and

                (ii) by amending the third sentence to read as follows: 
            ``Any copyright owners of sound recordings, preexisting 
            subscription services, or preexisting satellite digital 
            audio radio services may submit to the Librarian of 
            Congress licenses covering such subscription transmissions 
            with respect to such sound recordings.''; and
            (C) by striking paragraphs (2), (3), (4), and (5) and 
        inserting the following:
        ``(B) In the absence of license agreements negotiated under 
    subparagraph (A), during the 60-day period commencing 6 months 
    after publication of the notice specified in subparagraph (A), and 
    upon the filing of a petition in accordance with section 803(a)(1), 
    the Librarian of Congress shall, pursuant to chapter 8, convene a 
    copyright arbitration royalty panel to determine and publish in the 
    Federal Register a schedule of rates and terms which, subject to 
    paragraph (3), shall be binding on all copyright owners of sound 
    recordings and entities performing sound recordings affected by 
    this paragraph. In establishing rates and terms for preexisting 
    subscription services and preexisting satellite digital audio radio 
    services, in addition to the objectives set forth in section 
    801(b)(1), the copyright arbitration royalty panel may consider the 
    rates and terms for comparable types of subscription digital audio 
    transmission services and comparable circumstances under voluntary 
    license agreements negotiated as provided in subparagraph (A).
        ``(
2000
C)(i) Publication of a notice of the initiation of voluntary 
    negotiation proceedings as specified in subparagraph (A) shall be 
    repeated, in accordance with regulations that the Librarian of 
    Congress shall prescribe--
            ``(I) no later than 30 days after a petition is filed by 
        any copyright owners of sound recordings, any preexisting 
        subscription services, or any preexisting satellite digital 
        audio radio services indicating that a new type of subscription 
        digital audio transmission service on which sound recordings 
        are performed is or is about to become operational; and
            ``(II) in the first week of January 2001, and at 5-year 
        intervals thereafter.
        ``(ii) The procedures specified in subparagraph (B) shall be 
    repeated, in accordance with regulations that the Librarian of 
    Congress shall prescribe, upon filing of a petition in accordance 
    with section 803(a)(1) during a 60-day period commencing--
            ``(I) 6 months after publication of a notice of the 
        initiation of voluntary negotiation proceedings under 
        subparagraph (A) pursuant to a petition under clause (i)(I) of 
        this subparagraph; or
            ``(II) on July 1, 2001, and at 5-year intervals thereafter.
        ``(iii) The procedures specified in subparagraph (B) shall be 
    concluded in accordance with section 802.
        ``(2)(A) No later than 30 days after the date of the enactment 
    of the Digital Millennium Copyright Act, the Librarian of Congress 
    shall cause notice to be published in the Federal Register of the 
    initiation of voluntary negotiation proceedings for the purpose of 
    determining reasonable terms and rates of royalty payments for 
    public performances of sound recordings by means of eligible 
    nonsubscription transmissions and transmissions by new subscription 
    services specified by subsection (d)(2) during the period beginning 
    on the date of the enactment of such Act and ending on December 31, 
    2000, or such other date as the parties may agree. Such rates and 
    terms shall distinguish among the different types of eligible 
    nonsubscription transmission services and new subscription services 
    then in operation and shall include a minimum fee for each such 
    type of service. Any copyright owners of sound recordings or any 
    entities performing sound recordings affected by this paragraph may 
    submit to the Librarian of Congress licenses covering such eligible 
    nonsubscription transmissions and new subscription services with 
    respect to such sound recordings. The parties to each negotiation 
    proceeding shall bear their own costs.
        ``(B) In the absence of license agreements negotiated under 
    subparagraph (A), during the 60-day period commencing 6 months 
    after publication of the notice specified in subparagraph (A), and 
    upon the filing of a petition in accordance with section 803(a)(1), 
    the Librarian of Congress shall, pursuant to chapter 8, convene a 
    copyright arbitration royalty panel to determine and publish in the 
    Federal Register a schedule of rates and terms which, subject to 
    paragraph (3), shall be binding on all copyright owners of sound 
    recordings and entities performing sound recordings affected by 
    this paragraph during the period beginning on the date of the 
    enactment of the Digital Millennium Copyright Act and ending on 
    December 31, 2000, or such other date as the parties may agree. 
    Such rates and terms shall distinguish among the different types of 
    eligible nonsubscription transmission services then in operation 
    and shall include a minimum fee for each such type of service, such 
    differences to be based on criteria including, but not limited to, 
    the quantity and nature of the use of sound recordings and the 
    degree to which use of the service may substitute for or may 
    promote the purchase of phonorecords by consumers. In establishing 
    rates and terms for transmissions by eligible nonsubscription 
    services and new subscription services, the copyright arbitration 
    royalty panel shall establish rates and terms that most clearly 
    represent the rates and terms that would have been negotiated in 
    the marketplace between a willing buyer and a willing seller. In 
    determining such rates and terms, the copyright arbitration royalty 
    panel shall base its decision on economic, competitive and 
    programming information presented by the parties, including--
            ``(i) whether use of the service may substitute for or may 
        promote the sales of phonorecords or otherwise may interfere 
        with or may enhance the sound recording copyright owner's other 
        streams of revenue from its sound recordings; and
            ``(ii) the relative roles of the copyright owner and the 
        transmitting entity in the copyrighted work and the service 
        made available to the public with respect to relative creative 
        contribution, technological contribution, capital investment, 
        cost, and risk.
    In establishing such rates and terms, the copyright arbitration 
    royalty panel may consider the rates and terms for comparable types 
    of digital audio transmission services and comparable circumstances 
    under voluntary license agreements negotiated under subparagraph 
    (A).
        ``(C)(i) Publication of a notice of the initiation of voluntary 
    negotiation proceedings as specified in subparagraph (A) shall be 
    repeated in accordance with regulations that the Librarian of 
    Congress shall prescribe--
            ``(I) no later than 30 days after a petition is filed by 
        any copyright owners of sound recordings or any eligible 
        nonsubscription service or new subscription service indicating 
        that a new type of eligible nonsubscription service or new 
        subscription service on which sound recordings are performed is 
        or is about to become operational; and
            ``(II) in the first week of January 2000, and at 2-year 
        intervals thereafter, except to the extent that different years 
        for the repeating of such proceedings may be determined in 
        accordance with subparagraph (A).
        ``(ii) The procedures specified in subparagraph (B) shall be 
    repeated, in accordance with regulations that the Librarian of 
    Congress shall prescribe, upon filing of a petition in accordance 
    with section 803(a)(1) during a 60-day period commencing--
            ``(I) 6 months after publication of a notice of the 
        initiation of voluntary negotiation proceedings under 
        subparagraph (A) pursuant to a petition under clause (i)(I); or
            ``(II) on July 1, 2000, and at 2-year intervals thereafter, 
        except to the extent that different years for the repeating of 
        such proceedings may be determined in accordance with 
        subparagraph (A).
        ``(iii) The procedures specified in subparagraph (B) shall be 
    concluded in accordance with section 802.
        ``(3) License agreements voluntarily negotiated at any time 
    between 1 or more copyright owners of sound recordings and 1 or 
    more entities performing sound recordings shall be given effect in 
    lieu of any determination by a copyright arbitration royalty panel 
    or decision by the Librarian of Congress.
        ``(4)(A) The Librarian of Congress shall also establish 
    requirements by which copyright owners may receive reasonable 
    notice of the use of their sound recordings under this section, and 
    under which records of such use shall be kept and made available by 
    entities performing sound recordings.
        ``(B) Any person who wishes to perform a sound recording 
    publicly by means of a transmission eligible for statutory 
    licensing under this subsection may do so without infringing the 
    exclusive right of the copyright owner of the sound recording--
            ``(i) by complying with such notice req
2000
uirements as the 
        Librarian of Congress shall prescribe by regulation and by 
        paying royalty fees in accordance with this subsection; or
            ``(ii) if such royalty fees have not been set, by agreeing 
        to pay such royalty fees as shall be determined in accordance 
        with this subsection.
        ``(C) Any royalty payments in arrears shall be made on or 
    before the twentieth day of the month next succeeding the month in 
    which the royalty fees are set.''.
        (3) Subsection (g) is amended--
            (A) in the subsection heading by striking ``Sub- 
        scription'';
            (B) in paragraph (1) in the matter preceding subparagraph 
        (A), by striking ``subscription transmission licensed'' and 
        inserting ``transmission licensed under a statutory license'';
            (C) in subparagraphs (A) and (B) by striking 
        ``subscription''; and
            (D) in paragraph (2) by striking ``subscription''.
        (4) Subsection (j) is amended--
            (A) by striking paragraphs (4) and (9) and redesignating 
        paragraphs (2), (3), (5), (6), (7), and (8) as paragraphs (3), 
        (5), (9), (12), (13), and (14), respectively;
            (B) by inserting after paragraph (1) the following:
        ``(2) An `archived program' is a predetermined program that is 
    available repeatedly on the demand of the transmission recipient 
    and that is performed in the same order from the beginning, except 
    that an archived program shall not include a recorded event or 
    broadcast transmission that makes no more than an incidental use of 
    sound recordings, as long as such recorded event or broadcast 
    transmission does not contain an entire sound recording or feature 
    a particular sound recording.'';
            (C) by inserting after paragraph (3), as so redesignated, 
        the following:
        ``(4) A `continuous program' is a predetermined program that is 
    continuously performed in the same order and that is accessed at a 
    point in the program that is beyond the control of the transmission 
    recipient.'';
            (D) by inserting after paragraph (5), as so redesignated, 
        the following:
        ``(6) An `eligible nonsubscription transmission' is a 
    noninteractive nonsubscription digital audio transmission not 
    exempt under subsection (d)(1) that is made as part of a service 
    that provides audio programming consisting, in whole or in part, of 
    performances of sound recordings, including retransmissions of 
    broadcast transmissions, if the primary purpose of the service is 
    to provide to the public such audio or other entertainment 
    programming, and the primary purpose of the service is not to sell, 
    advertise, or promote particular products or services other than 
    sound recordings, live concerts, or other music-related events.
        ``(7) An `interactive service' is one that enables a member of 
    the public to receive a transmission of a program specially created 
    for the recipient, or on request, a transmission of a particular 
    sound recording, whether or not as part of a program, which is 
    selected by or on behalf of the recipient. The ability of 
    individuals to request that particular sound recordings be 
    performed for reception by the public at large, or in the case of a 
    subscription service, by all subscribers of the service, does not 
    make a service interactive, if the programming on each channel of 
    the service does not substantially consist of sound recordings that 
    are performed within 1 hour of the request or at a time designated 
    by either the transmitting entity or the individual making such 
    request. If an entity offers both interactive and noninteractive 
    services (either concurrently or at different times), the 
    noninteractive component shall not be treated as part of an 
    interactive service.
        ``(8) A `new subscription service' is a service that performs 
    sound recordings by means of noninteractive subscription digital 
    audio transmissions and that is not a preexisting subscription 
    service or a preexisting satellite digital audio radio service.'';
            (E) by inserting after paragraph (9), as so redesignated, 
        the following:
        ``(10) A `preexisting satellite digital audio radio service' is 
    a subscription satellite digital audio radio service provided 
    pursuant to a satellite digital audio radio service license issued 
    by the Federal Communications Commission on or before July 31, 
    1998, and any renewal of such license to the extent of the scope of 
    the original license, and may include a limited number of sample 
    channels representative of the subscription service that are made 
    available on a nonsubscription basis in order to promote the 
    subscription service.
        ``(11) A `preexisting subscription service' is a service that 
    performs sound recordings by means of noninteractive audio-only 
    subscription digital audio transmissions, which was in existence 
    and was making such transmissions to the public for a fee on or 
    before July 31, 1998, and may include a limited number of sample 
    channels representative of the subscription service that are made 
    available on a nonsubscription basis in order to promote the 
    subscription service.''; and
            (F) by adding at the end the following:
        ``(15) A `transmission' is either an initial transmission or a 
    retransmission.''.
        (5) The amendment made by paragraph (2)(B)(i)(III) of this 
    subsection shall be deemed to have been enacted as part of the 
    Digital Performance Right in Sound Recordings Act of 1995, and the 
    publication of notice of proceedings under section 114(f)(1) of 
    title 17, United States Code, as in effect upon the effective date 
    of that Act, for the determination of royalty payments shall be 
    deemed to have been made for the period beginning on the effective 
    date of that Act and ending on December 1, 2001.
        (6) The amendments made by this subsection do not annul, limit, 
    or otherwise impair the rights that are preserved by section 114 of 
    title 17, United States Code, including the rights preserved by 
    subsections (c), (d)(4), and (i) of such section.
    (b) Ephemeral Recordings.--Section 112 of title 17, United States 
Code, is amended--
        (1) by redesignating subsection (e) as subsection (f); and
        (2) by inserting after subsection (d) the following:
    ``(e) Statutory License.--(1) A transmitting organization entitled 
to transmit to the public a performance of a sound recording under the 
limitation on exclusive rights specified by section 114(d)(1)(C)(iv) or 
under a statutory license in accordance with section 114(f) is entitled 
to a statutory license, under the conditions specified by this 
subsection, to make no more than 1 phonorecord of the sound recording 
(unless the terms and conditions of the statutory license allow for 
more), if the following conditions are satisfied:
        ``(A) The phonorecord is retained and used solely by the 
    transmitting organization that made it, and no further phonorecords 
    are reproduced from it.
        ``(B) The phonorecord is used solely for the transmitting 
    organization's own transmissions originating in the United States 
    under a statutory license in accordance with section 114(f) or the 
    limitation on exclusive rights specified by section 
    114(d)(1)(C)(iv).
        ``(C) Unless preserved exclusively for purposes of archival 
    preservation, the phonorecord is destroyed within 6 months from the 
    date the sound recording was first transmitted to the public using 
    the phonorecord.
        ``(D) Phonorecords of the sound recording have been distributed 
    to the public under the authority of the copyright owner or the 
    copyright owner authorizes the transmitting entity to transmit the 
    sound recording, and the transmitting entity makes the phonorecord 
    under this subsect
2000
ion from a phonorecord lawfully made and acquired 
    under the authority of the copyright owner.
    ``(3) Notwithstanding any provision of the antitrust laws, any 
copyright owners of sound recordings and any transmitting organizations 
entitled to a statutory license under this subsection may negotiate and 
agree upon royalty rates and license terms and conditions for making 
phonorecords of such sound recordings under this section and the 
proportionate division of fees paid among copyright owners, and may 
designate common agents to negotiate, agree to, pay, or receive such 
royalty payments.
    ``(4) No later than 30 days after the date of the enactment of the 
Digital Millennium Copyright Act, the Librarian of Congress shall cause 
notice to be published in the Federal Register of the initiation of 
voluntary negotiation proceedings for the purpose of determining 
reasonable terms and rates of royalty payments for the activities 
specified by paragraph (2) of this subsection during the period 
beginning on the date of the enactment of such Act and ending on 
December 31, 2000, or such other date as the parties may agree. Such 
rates shall include a minimum fee for each type of service offered by 
transmitting organizations. Any copyright owners of sound recordings or 
any transmitting organizations entitled to a statutory license under 
this subsection may submit to the Librarian of Congress licenses 
covering such activities with respect to such sound recordings. The 
parties to each negotiation proceeding shall bear their own costs.
    ``(5) In the absence of license agreements negotiated under 
paragraph (3), during the 60-day period commencing 6 months after 
publication of the notice specified in paragraph (4), and upon the 
filing of a petition in accordance with section 803(a)(1), the 
Librarian of Congress shall, pursuant to chapter 8, convene a copyright 
arbitration royalty panel to determine and publish in the Federal 
Register a schedule of reasonable rates and terms which, subject to 
paragraph (6), shall be binding on all copyright owners of sound 
recordings and transmitting organizations entitled to a statutory 
license under this subsection during the period beginning on the date 
of the enactment of the Digital Millennium Copyright Act and ending on 
December 31, 2000, or such other date as the parties may agree. Such 
rates shall include a minimum fee for each type of service offered by 
transmitting organizations. The copyright arbitration royalty panel 
shall establish rates that most clearly represent the fees that would 
have been negotiated in the marketplace between a willing buyer and a 
willing seller. In determining such rates and terms, the copyright 
arbitration royalty panel shall base its decision on economic, 
competitive, and programming information presented by the parties, 
including--
        ``(A) whether use of the service may substitute for or may 
    promote the sales of phonorecords or otherwise interferes with or 
    enhances the copyright owner's traditional streams of revenue; and
        ``(B) the relative roles of the copyright owner and the 
    transmitting organization in the copyrighted work and the service 
    made available to the public with respect to relative creative 
    contribution, technological contribution, capital investment, cost, 
    and risk.
In establishing such rates and terms, the copyright arbitration royalty 
panel may consider the rates and terms under voluntary license 
agreements negotiated as provided in paragraphs (3) and (4). The 
Librarian of Congress shall also establish requirements by which 
copyright owners may receive reasonable notice of the use of their 
sound recordings under this section, and under which records of such 
use shall be kept and made available by transmitting organizations 
entitled to obtain a statutory license under this subsection.
    ``(6) License agreements voluntarily negotiated at any time between 
1 or more copyright owners of sound recordings and 1 or more 
transmitting organizations entitled to obtain a statutory license under 
this subsection shall be given effect in lieu of any determination by a 
copyright arbitration royalty panel or decision by the Librarian of 
Congress.
    ``(7) Publication of a notice of the initiation of voluntary 
negotiation proceedings as specified in paragraph (4) shall be 
repeated, in accordance with regulations that the Librarian of Congress 
shall prescribe, in the first week of January 2000, and at 2-year 
intervals thereafter, except to the extent that different years for the 
repeating of such proceedings may be determined in accordance with 
paragraph (4). The procedures specified in paragraph (5) shall be 
repeated, in accordance with regulations that the Librarian of Congress 
shall prescribe, upon filing of a petition in accordance with section 
803(a)(1), during a 60-day period commencing on July 1, 2000, and at 2-
year intervals thereafter, except to the extent that different years 
for the repeating of such proceedings may be determined in accordance 
with paragraph (4). The procedures specified in paragraph (5) shall be 
concluded in accordance with section 802.
    ``(8)(A) Any person who wishes to make a phonorecord of a sound 
recording under a statutory license in accordance with this subsection 
may do so without infringing the exclusive right of the copyright owner 
of the sound recording under section 106(1)--
        ``(i) by complying with such notice requirements as the 
    Librarian of Congress shall prescribe by regulation and by paying 
    royalty fees in accordance with this subsection; or
        ``(ii) if such royalty fees have not been set, by agreeing to 
    pay such royalty fees as shall be determined in accordance with 
    this subsection.
    ``(B) Any royalty payments in arrears shall be made on or before 
the 20th day of the month next succeeding the month in which the 
royalty fees are set.
    ``(9) If a transmitting organization entitled to make a phonorecord 
under this subsection is prevented from making such phonorecord by 
reason of the application by the copyright owner of technical measures 
that prevent the reproduction of the sound recording, the copyright 
owner shall make available to the transmitting organization the 
necessary means for permitting the making of such phonorecord as 
permitted under this subsection, if it is technologically feasible and 
economically reasonable for the copyright owner to do so. If the 
copyright owner fails to do so in a timely manner in light of the 
transmitting organization's reasonable business requirements, the 
transmitting organization shall not be liable for a violation of 
section 1201(a)(1) of this title for engaging in such activities as are 
necessary to make such phonorecords as permitted under this subsection.
    ``(10) Nothing in this subsection annuls, limits, impairs, or 
otherwise affects in any way the existence or value of any of the 
exclusive rights of the copyright owners in a sound recording, except 
as otherwise provided in this subsection, or in a musical work, 
including the exclusive rights to reproduce and distribute a sound 
recording or musical work, including by means of a digital phonorecord 
delivery, under sections 106(1), 106(3), and 115, and the right to 
perform publicly a sound recording or musical work, including by means 
of a digital audio transmission, under sections 106(4) and 106(6).''.
    (c) Scope of Section 112(a) of Title 17 Not Affected.--Nothing in 
this section or the amendments made by this section shall affect the 
scope of section 112(a) of title 17, United States Code, or the 
entitlement of any person to an exemption thereunder.
    (d) Procedural Amendments to Chapter 8.--Section 802 of title 17, 
United States Code, is amended--
        (1) in subsection (f)--
            (A) in the first sentence by striking ``60'' and inserting 
        ``90''; and
            (B) in the third sentence by striking ``that 60-day 
        period'' and inserting ``an additional 30-day period''; and
        (2) in subsection (g) by inserting after the s
2000
econd sentence 
    the following: ``When this title provides that the royalty rates or 
    terms that were previously in effect are to expire on a specified 
    date, any adjustment by the Librarian of those rates or terms shall 
    be effective as of the day following the date of expiration of the 
    rates or terms that were previously in effect, even if the 
    Librarian's decision is rendered on a later date.''.
    (e) Conforming Amendments.--(1) Section 801(b)(1) of title 17, 
United States Code, is amended in the second sentence by striking 
``sections 114, 115, and 116'' and inserting ``sections 114(f)(1)(B), 
115, and 116''.
    (2) Section 802(c) of title 17, United States Code, is amended by 
striking ``section 111, 114, 116, or 119, any person entitled to a 
compulsory license'' and inserting ``section 111, 112, 114, 116, or 
119, any transmitting organization entitled to a statutory license 
under section 112(f), any person entitled to a statutory license''.
    (3) Section 802(g) of title 17, United States Code, is amended by 
striking ``sections 111, 114'' and inserting ``sections 111, 112, 
114''.
    (4) Section 802(h)(2) of title 17, United States Code, is amended 
by striking ``section 111, 114'' and inserting ``section 111, 112, 
114''.
    (5) Section 803(a)(1) of title 17, United States Code, is amended 
by striking ``sections 114, 115'' and inserting ``sections 112, 114, 
115''.
    (6) Section 803(a)(5) of title 17, United States Code, is amended--
        (A) by striking ``section 114'' and inserting ``section 112 or 
    114''; and
        (B) by striking ``that section'' and inserting ``those 
    sections''.

SEC. 406. ASSUMPTION OF CONTRACTUAL OBLIGATIONS RELATED TO TRANSFERS OF 
              RIGHTS IN MOTION PICTURES.

    (a) In General.--Part VI of title 28, United States Code, is 
amended by adding at the end the following new chapter:

      ``CHAPTER 180--ASSUMPTION OF CERTAIN CONTRACTUAL OBLIGATIONS

``Sec. 4001. Assumption of contractual obligations related to transfers 
          of rights in motion pictures.

``Sec. 4001. Assumption of contractual obligations related to transfers 
            of rights in motion pictures

    ``(a) Assumption of Obligations.--(1) In the case of a transfer of 
copyright ownership under United States law in a motion picture (as the 
terms `transfer of copyright ownership' and `motion picture' are 
defined in section 101 of title 17) that is produced subject to 1 or 
more collective bargaining agreements negotiated under the laws of the 
United States, if the transfer is executed on or after the effective 
date of this chapter and is not limited to public performance rights, 
the transfer instrument shall be deemed to incorporate the assumption 
agreements applicable to the copyright ownership being transferred that 
are required by the applicable collective bargaining agreement, and the 
transferee shall be subject to the obligations under each such 
assumption agreement to make residual payments and provide related 
notices, accruing after the effective date of the transfer and 
applicable to the exploitation of the rights transferred, and any 
remedies under each such assumption agreement for breach of those 
obligations, as those obligations and remedies are set forth in the 
applicable collective bargaining agreement, if--
        ``(A) the transferee knows or has reason to know at the time of 
    the transfer that such collective bargaining agreement was or will 
    be applicable to the motion picture; or
        ``(B) in the event of a court order confirming an arbitration 
    award against the transferor under the collective bargaining 
    agreement, the transferor does not have the financial ability to 
    satisfy the award within 90 days after the order is issued.
    ``(2) For purposes of paragraph (1)(A), `knows or has reason to 
know' means any of the following:
        ``(A) Actual knowledge that the collective bargaining agreement 
    was or will be applicable to the motion picture.
        ``(B)(i) Constructive knowledge that the collective bargaining 
    agreement was or will be applicable to the motion picture, arising 
    from recordation of a document pertaining to copyright in the 
    motion picture under section 205 of title 17 or from publication, 
    at a site available to the public on-line that is operated by the 
    relevant union, of information that identifies the motion picture 
    as subject to a collective bargaining agreement with that union, if 
    the site permits commercially reasonable verification of the date 
    on which the information was available for access.
        ``(ii) Clause (i) applies only if the transfer referred to in 
    subsection (a)(1) occurs--
            ``(I) after the motion picture is completed, or
            ``(II) before the motion picture is completed and--
                ``(aa) within 18 months before the filing of an 
            application for copyright registration for the motion 
            picture under section 408 of title 17, or
                ``(bb) if no such application is filed, within 18 
            months before the first publication of the motion picture 
            in the United States.
        ``(C) Awareness of other facts and circumstances pertaining to 
    a particular transfer from which it is apparent that the collective 
    bargaining agreement was or will be applicable to the motion 
    picture.
    ``(b) Scope of Exclusion of Transfers of Public Performance 
Rights.--For purposes of this section, the exclusion under subsection 
(a) of transfers of copyright ownership in a motion picture that are 
limited to public performance rights includes transfers to a 
terrestrial broadcast station, cable system, or programmer to the 
extent that the station, system, or programmer is functioning as an 
exhibitor of the motion picture, either by exhibiting the motion 
picture on its own network, system, service, or station, or by 
initiating the transmission of an exhibition that is carried on another 
network, system, service, or station. When a terrestrial broadcast 
station, cable system, or programmer, or other transferee, is also 
functioning otherwise as a distributor or as a producer of the motion 
picture, the public performance exclusion does not affect any 
obligations imposed on the transferee to the extent that it is engaging 
in such functions.
    ``(c) Exclusion for Grants of Security Interests.--Subsection (a) 
shall not apply to--
        ``(1) a transfer of copyright ownership consisting solely of a 
    mortgage, hypothecation, or other security interest; or
        ``(2) a subsequent transfer of the copyright ownership secured 
    by the security interest described in paragraph (1) by or under the 
    authority of the secured party, including a transfer through the 
    exercise of the secured party's rights or remedies as a secured 
    party, or by a subsequent transferee.
The exclusion under this subsection shall not affect any rights or 
remedies under law or contract.
    ``(d) Deferral Pending Resolution of Bona Fide Dispute.--A 
transferee on which obligations are imposed under subsection (a) by 
virtue of paragraph (1) of that subsection may elect to defer 
performance of such obligations that are subject to a bona fide dispute 
between a union and a prior transferor until that dispute is resolved, 
except that such deferral shall not stay accrual of any union claims 
due under an applicable collective bargaining agreement.
    ``(e) Scope of Obligations Determined by Private Agreement.--
Nothing in this section shall expand or diminish the rights, 
obligations, or remedies of any person under the collective bargaining 
agreements or assumption agreements referred to in this section.
    ``(f) Failure To Notify.--If the transferor under subsection (a) 
fails to notify the transferee under subsection (a) of applicable 
collective bargaining obligations before the execution of the transfer 
instrument, and subsection (a) is made applicable to the transferee 
solely by virtue of subsection (a)(1)(B), the transferor shall be 
liable to 
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the transferee for any damages suffered by the transferee as 
a result of the failure to notify.
    ``(g) Determination of Disputes and Claims.--Any dispute concerning 
the application of subsections (a) through (f) shall be determined by 
an action in United States district court, and the court in its 
discretion may allow the recovery of full costs by or against any party 
and may also award a reasonable attorney's fee to the prevailing party 
as part of the costs.
    ``(h) Study.--The Comptroller General, in consultation with the 
Register of Copyrights, shall conduct a study of the conditions in the 
motion picture industry that gave rise to this section, and the impact 
of this section on the motion picture industry. The Comptroller General 
shall report the findings of the study to the Congress within 2 years 
after the effective date of this chapter.''.
    (b) Conforming Amendment.--The table of chapters for part VI of 
title 28, United States Code, is amended by adding at the end the 
following:

``180. Assumption of Certain Contractual Obligations.............4001''.

SEC. 407. EFFECTIVE DATE.

    Except as otherwise provided in this title, this title and the 
amendments made by this title shall take effect on the date of the 
enactment of this Act.

            TITLE V--PROTECTION OF CERTAIN ORIGINAL DESIGNS

SEC. 501. SHORT TITLE.

    This Act may be referred to as the ``Vessel Hull Design Protection 
Act''.

SEC. 502. PROTECTION OF CERTAIN ORIGINAL DESIGNS.

    Title 17, United States Code, is amended by adding at the end the 
following new chapter:

              ``CHAPTER 13--PROTECTION OF ORIGINAL DESIGNS

``Sec.
``1301. Designs protected.
``1302. Designs not subject to protection.
``1303. Revisions, adaptations, and rearrangements.
``1304. Commencement of protection.
``1305. Term of protection.
``1306. Design notice.
``1307. Effect of omission of notice.
``1308. Exclusive rights.
``1309. Infringement.
``1310. Application for registration.
``1311. Benefit of earlier filing date in foreign country.
``1312. Oaths and acknowledgments.
``1313. Examination of application and issue or refusal of registration.
``1314. Certification of registration.
``1315. Publication of announcements and indexes.
``1316. Fees.
``1317. Regulations.
``1318. Copies of records.
``1319. Correction of errors in certificates.
``1320. Ownership and transfer.
``1321. Remedy for infringement.
``1322. Injunctions.
``1323. Recovery for infringement.
``1324. Power of court over registration.
``1325. Liability for action on registration fraudulently obtained.
``1326. Penalty for false marking.
``1327. Penalty for false representation.
``1328. Enforcement by Treasury and Postal Service.
``1329. Relation to design patent law.
``1330. Common law and other rights unaffected.
``1331. Administrator; Office of the Administrator.
``1332. No retroactive effect.

``Sec. 1301. Designs protected

    ``(a) Designs Protected.--
        ``(1) In general.--The designer or other owner of an original 
    design of a useful article which makes the article attractive or 
    distinctive in appearance to the purchasing or using public may 
    secure the protection provided by this chapter upon complying with 
    and subject to this chapter.
        ``(2) Vessel hulls.--The design of a vessel hull, including a 
    plug or mold, is subject to protection under this chapter, 
    notwithstanding section 1302(4).
    ``(b) Definitions.--For the purpose of this chapter, the following 
terms have the following meanings:
        ``(1) A design is `original' if it is the result of the 
    designer's creative endeavor that provides a distinguishable 
    variation over prior work pertaining to similar articles which is 
    more than merely trivial and has not been copied from another 
    source.
        ``(2) A `useful article' is a vessel hull, including a plug or 
    mold, which in normal use has an intrinsic utilitarian function 
    that is not merely to portray the appearance of the article or to 
    convey information. An article which normally is part of a useful 
    article shall be deemed to be a useful article.
        ``(3) A `vessel' is a craft, especially one larger than a 
    rowboat, designed to navigate on water, but does not include any 
    such craft that exceeds 200 feet in length.
        ``(4) A `hull' is the frame or body of a vessel, including the 
    deck of a vessel, exclusive of masts, sails, yards, and rigging.
        ``(5) A `plug' means a device or model used to make a mold for 
    the purpose of exact duplication, regardless of whether the device 
    or model has an intrinsic utilitarian function that is not only to 
    portray the appearance of the product or to convey information.
        ``(6) A `mold' means a matrix or form in which a substance for 
    material is used, regardless of whether the matrix or form has an 
    intrinsic utilitarian function that is not only to portray the 
    appearance of the product or to convey information.

``Sec. 1302. Designs not subject to protection

    ``Protection under this chapter shall not be available for a design 
that is--
        ``(1) not original;
        ``(2) staple or commonplace, such as a standard geometric 
    figure, a familiar symbol, an emblem, or a motif, or another shape, 
    pattern, or configuration which has become standard, common, 
    prevalent, or ordinary;
        ``(3) different from a design excluded by paragraph (2) only in 
    insignificant details or in elements which are variants commonly 
    used in the relevant trades;
        ``(4) dictated solely by a utilitarian function of the article 
    that embodies it; or
        ``(5) embodied in a useful article that was made public by the 
    designer or owner in the United States or a foreign country more 
    than 1 year before the date of the application for registration 
    under this chapter.

``Sec. 1303. Revisions, adaptations, and rearrangements

    ``Protection for a design under this chapter shall be available 
notwithstanding the employment in the design of subject matter excluded 
from protection under section 1302 if the design is a substantial 
revision, adaptation, or rearrangement of such subject matter. Such 
protection shall be independent of any subsisting protection in subject 
matter employed in the design, and shall not be construed as securing 
any right to subject matter excluded from protection under this chapter 
or as extending any subsisting protection under this chapter.

``Sec. 1304. Commencement of protection

    ``The protection provided for a design under this chapter shall 
commence upon the earlier of the date of publication of the 
registration under section 1313(a) or the date the design is first made 
public as defined by section 1310(b).

``Sec. 1305. Term of protection

    ``(a) In General.--Subject to subsection (b), the protection 
provided under this chapter for a design shall continue for a term of 
10 years beginning on the date of the commencement of protection under 
section 1304.
    ``(b) Expiration.--All terms of protection provided in this section 
shall run to the end of the calendar year in which they would otherwise 
expire.
    ``(c) Termination of Rights.--Upon expiration or termination of 
protection in a particular design under this chapter, all rights under 
this chapter in the design shall terminate, regardless of the number of 
different articles in which the design may have been used during the 
term of its protection.

``Sec. 1306. Design notice

    ``(a) Contents of Design Notice.--(1) Whenever any design for which 
protection is sought under this chapter is made public under section 
1310(b), the owner of the design shall, subject to the provisions of 
section 1307, mark it or have it marked legibly with a design notice 
consisting of--
        ``(A) the words `Protected Design', the abbreviation `Prot'd 
    Des.', or the letter `D' with a circle, or the symbol `*D*';
        ``(B) the year of the date on which protection for the design 
    commenced; and
        ``(C) the name of the owner, an abbreviation by which the name 
    can 
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be recognized, or a generally accepted alternative designation 
    of the owner.
Any distinctive identification of the owner may be used for purposes of 
subparagraph (C) if it has been recorded by the Administrator before 
the design marked with such identification is registered.
    ``(2) After registration, the registration number may be used 
instead of the elements specified in subparagraphs (B) and (C) of 
paragraph (1).
    ``(b) Location of Notice.--The design notice shall be so located 
and applied as to give reasonable notice of design protection while the 
useful article embodying the design is passing through its normal 
channels of commerce.
    ``(c) Subsequent Removal of Notice.--When the owner of a design has 
complied with the provisions of this section, protection under this 
chapter shall not be affected by the removal, destruction, or 
obliteration by others of the design notice on an article.

``Sec. 1307. Effect of omission of notice

    ``(a) Actions With Notice.--Except as provided in subsection (b), 
the omission of the notice prescribed in section 1306 shall not cause 
loss of the protection under this chapter or prevent recovery for 
infringement under this chapter against any person who, after receiving 
written notice of the design protection, begins an undertaking leading 
to infringement under this chapter.
    ``(b) Actions Without Notice.--The omission of the notice 
prescribed in section 1306 shall prevent any recovery under section 
1323 against a person who began an undertaking leading to infringement 
under this chapter before receiving written notice of the design 
protection. No injunction shall be issued under this chapter with 
respect to such undertaking unless the owner of the design reimburses 
that person for any reasonable expenditure or contractual obligation in 
connection with such undertaking that was incurred before receiving 
written notice of the design protection, as the court in its discretion 
directs. The burden of providing written notice of design protection 
shall be on the owner of the design.

``Sec. 1308. Exclusive rights

    ``The owner of a design protected under this chapter has the 
exclusive right to--
        ``(1) make, have made, or import, for sale or for use in trade, 
    any useful article embodying that design; and
        ``(2) sell or distribute for sale or for use in trade any 
    useful article embodying that design.

``Sec. 1309. Infringement

    ``(a) Acts of Infringement.--Except as provided in subsection (b), 
it shall be infringement of the exclusive rights in a design protected 
under this chapter for any person, without the consent of the owner of 
the design, within the United States and during the term of such 
protection, to--
        ``(1) make, have made, or import, for sale or for use in trade, 
    any infringing article as defined in subsection (e); or
        ``(2) sell or distribute for sale or for use in trade any such 
    infringing article.
    ``(b) Acts of Sellers and Distributors.--A seller or distributor of 
an infringing article who did not make or import the article shall be 
deemed to have infringed on a design protected under this chapter only 
if that person--
        ``(1) induced or acted in collusion with a manufacturer to 
    make, or an importer to import such article, except that merely 
    purchasing or giving an order to purchase such article in the 
    ordinary course of business shall not of itself constitute such 
    inducement or collusion; or
        ``(2) refused or failed, upon the request of the owner of the 
    design, to make a prompt and full disclosure of that person's 
    source of such article, and that person orders or reorders such 
    article after receiving notice by registered or certified mail of 
    the protection subsisting in the design.
    ``(c) Acts Without Knowledge.--It shall not be infringement under 
this section to make, have made, import, sell, or distribute, any 
article embodying a design which was created without knowledge that a 
design was protected under this chapter and was copied from such 
protected design.
    ``(d) Acts in Ordinary Course of Business.--A person who 
incorporates into that person's product of manufacture an infringing 
article acquired from others in the ordinary course of business, or 
who, without knowledge of the protected design embodied in an 
infringing article, makes or processes the infringing article for the 
account of another person in the ordinary course of business, shall not 
be deemed to have infringed the rights in that design under this 
chapter except under a condition contained in paragraph (1) or (2) of 
subsection (b). Accepting an order or reorder from the source of the 
infringing article shall be deemed ordering or reordering within the 
meaning of subsection (b)(2).
    ``(e) Infringing Article Defined.--As used in this section, an 
`infringing article' is any article the design of which has been copied 
from a design protected under this chapter, without the consent of the 
owner of the protected design. An infringing article is not an 
illustration or picture of a protected design in an advertisement, 
book, periodical, newspaper, photograph, broadcast, motion picture, or 
similar medium. A design shall not be deemed to have been copied from a 
protected design if it is original and not substantially similar in 
appearance to a protected design.
    ``(f) Establishing Originality.--The party to any action or 
proceeding under this chapter who alleges rights under this chapter in 
a design shall have the burden of establishing the design's originality 
whenever the opposing party introduces an earlier work which is 
identical to such design, or so similar as to make prima facie showing 
that such design was copied from such work.
    ``(g) Reproduction for Teaching or Analysis.--It is not an 
infringement of the exclusive rights of a design owner for a person to 
reproduce the design in a useful article or in any other form solely 
for the purpose of teaching, analyzing, or evaluating the appearance, 
concepts, or techniques embodied in the design, or the function of the 
useful article embodying the design.

``Sec. 1310. Application for registration

    ``(a) Time Limit for Application for Registration.--Protection 
under this chapter shall be lost if application for registration of the 
design is not made within 2 years after the date on which the design is 
first made public.
    ``(b) When Design is Made Public.--A design is made public when an 
existing useful article embodying the design is anywhere publicly 
exhibited, publicly distributed, or offered for sale or sold to the 
public by the owner of the design or with the owner's consent.
    ``(c) Application by Owner of Design.--Application for registration 
may be made by the owner of the design.
    ``(d) Contents of Application.--The application for registration 
shall be made to the Administrator and shall state--
        ``(1) the name and address of the designer or designers of the 
    design;
        ``(2) the name and address of the owner if different from the 
    designer;
        ``(3) the specific name of the useful article embodying the 
    design;
        ``(4) the date, if any, that the design was first made public, 
    if such date was earlier than the date of the application;
        ``(5) affirmation that the design has been fixed in a useful 
    article; and
        ``(6) such other information as may be required by the 
    Administrator.
The application for registration may include a description setting 
forth the salient features of the design, but the absence of such a 
description shall not prevent registration under this chapter.
    ``(e) Sworn Statement.--The application for registration shall be 
accompanied by a statement under oath by the applicant or the 
applicant's duly authorized agent or representative, setting forth, to 
the best of the applicant's knowledge and belief--
        ``(1) that the design is original and was created by the 
    designer or designers named in the application;
        ``(2) that the design has not pr
2000
eviously been registered on 
    behalf of the applicant or the applicant's predecessor in title; 
    and
        ``(3) that the applicant is the person entitled to protection 
    and to registration under this chapter.
If the design has been made public with the design notice prescribed in 
section 1306, the statement shall also describe the exact form and 
position of the design notice.
    ``(f) Effect of Errors.--(1) Error in any statement or assertion as 
to the utility of the useful article named in the application under 
this section, the design of which is sought to be registered, shall not 
affect the protection secured under this chapter.
    ``(2) Errors in omitting a joint designer or in naming an alleged 
joint designer shall not affect the validity of the registration, or 
the actual ownership or the protection of the design, unless it is 
shown that the error occurred with deceptive intent.
    ``(g) Design Made in Scope of Employment.--In a case in which the 
design was made within the regular scope of the designer's employment 
and individual authorship of the design is difficult or impossible to 
ascribe and the application so states, the name and address of the 
employer for whom the design was made may be stated instead of that of 
the individual designer.
    ``(h) Pictorial Representation of Design.--The application for 
registration shall be accompanied by two copies of a drawing or other 
pictorial representation of the useful article embodying the design, 
having one or more views, adequate to show the design, in a form and 
style suitable for reproduction, which shall be deemed a part of the 
application.
    ``(i) Design in More Than One Useful Article.--If the 
distinguishing elements of a design are in substantially the same form 
in different useful articles, the design shall be protected as to all 
such useful articles when protected as to one of them, but not more 
than one registration shall be required for the design.
    ``(j) Application for More Than One Design.--More than one design 
may be included in the same application under such conditions as may be 
prescribed by the Administrator. For each design included in an 
application the fee prescribed for a single design shall be paid.

``Sec. 1311. Benefit of earlier filing date in foreign country

    ``An application for registration of a design filed in the United 
States by any person who has, or whose legal representative or 
predecessor or successor in title has, previously filed an application 
for registration of the same design in a foreign country which extends 
to designs of owners who are citizens of the United States, or to 
applications filed under this chapter, similar protection to that 
provided under this chapter shall have that same effect as if filed in 
the United States on the date on which the application was first filed 
in such foreign country, if the application in the United States is 
filed within 6 months after the earliest date on which any such foreign 
application was filed.

``Sec. 1312. Oaths and acknowledgments

    ``(a) In General.--Oaths and acknowledgments required by this 
chapter--
        ``(1) may be made--
            ``(A) before any person in the United States authorized by 
        law to administer oaths; or
            ``(B) when made in a foreign country, before any diplomatic 
        or consular officer of the United States authorized to 
        administer oaths, or before any official authorized to 
        administer oaths in the foreign country concerned, whose 
        authority shall be proved by a certificate of a diplomatic or 
        consular officer of the United States; and
        ``(2) shall be valid if they comply with the laws of the State 
    or country where made.
    ``(b) Written Declaration in Lieu of Oath.--(1) The Administrator 
may by rule prescribe that any document which is to be filed under this 
chapter in the Office of the Administrator and which is required by any 
law, rule, or other regulation to be under oath, may be subscribed to 
by a written declaration in such form as the Administrator may 
prescribe, and such declaration shall be in lieu of the oath otherwise 
required.
    ``(2) Whenever a written declaration under paragraph (1) is used, 
the document containing the declaration shall state that willful false 
statements are punishable by fine or imprisonment, or both, pursuant to 
section 1001 of title 18, and may jeopardize the validity of the 
application or document or a registration resulting therefrom.

``Sec. 1313. Examination of application and issue or refusal of 
            registration

    ``(a) Determination of Registrability of Design; Registration.--
Upon the filing of an application for registration in proper form under 
section 1310, and upon payment of the fee prescribed under section 
1316, the Administrator shall determine whether or not the application 
relates to a design which on its face appears to be subject to 
protection under this chapter, and, if so, the Register shall register 
the design. Registration under this subsection shall be announced by 
publication. The date of registration shall be the date of publication.
    ``(b) Refusal To Register; Reconsideration.--If, in the judgment of 
the Administrator, the application for registration relates to a design 
which on its face is not subject to protection under this chapter, the 
Administrator shall send to the applicant a notice of refusal to 
register and the grounds for the refusal. Within 3 months after the 
date on which the notice of refusal is sent, the applicant may, by 
written request, seek reconsideration of the application. After 
consideration of such a request, the Administrator shall either 
register the design or send to the applicant a notice of final refusal 
to register.
    ``(c) Application To Cancel Registration.--Any person who believes 
he or she is or will be damaged by a registration under this chapter 
may, upon payment of the prescribed fee, apply to the Administrator at 
any time to cancel the registration on the ground that the design is 
not subject to protection under this chapter, stating the reasons for 
the request. Upon receipt of an application for cancellation, the 
Administrator shall send to the owner of the design, as shown in the 
records of the Office of the Administrator, a notice of the 
application, and the owner shall have a period of 3 months after the 
date on which such notice is mailed in which to present arguments to 
the Administrator for support of the validity of the registration. The 
Administrator shall also have the authority to establish, by 
regulation, conditions under which the opposing parties may appear and 
be heard in support of their arguments. If, after the periods provided 
for the presentation of arguments have expired, the Administrator 
determines that the applicant for cancellation has established that the 
design is not subject to protection under this chapter, the 
Administrator shall order the registration stricken from the record. 
Cancellation under this subsection shall be announced by publication, 
and notice of the Administrator's final determination with respect to 
any application for cancellation shall be sent to the applicant and to 
the owner of record.

``Sec. 1314. Certification of registration

    ``Certificates of registration shall be issued in the name of the 
United States under the seal of the Office of the Administrator and 
shall be recorded in the official records of the Office. The 
certificate shall state the name of the useful article, the date of 
filing of the application, the date of registration, and the date the 
design was made public, if earlier than the date of filing of the 
application, and shall contain a reproduction of the drawing or other 
pictorial representation of the design. If a description of the salient 
features of the design appears in the application, the description 
shall also appear in the certificate. A certificate of registration 
shall be admitted in any court as prima facie evidence of the facts 
stated in the certificate.

``Sec. 1315. Publication
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 of announcements and indexes

    ``(a) Publications of the Administrator.--The Administrator shall 
publish lists and indexes of registered designs and cancellations of 
designs and may also publish the drawings or other pictorial 
representations of registered designs for sale or other distribution.
    ``(b) File of Representatives of Registered Designs.--The 
Administrator shall establish and maintain a file of the drawings or 
other pictorial representations of registered designs. The file shall 
be available for use by the public under such conditions as the 
Administrator may prescribe.

``Sec. 1316. Fees

    ``The Administrator shall by regulation set reasonable fees for the 
filing of applications to register designs under this chapter and for 
other services relating to the administration of this chapter, taking 
into consideration the cost of providing these services and the benefit 
of a public record.

``Sec. 1317. Regulations

    ``The Administrator may establish regulations for the 
administration of this chapter.

``Sec. 1318. Copies of records

    ``Upon payment of the prescribed fee, any person may obtain a 
certified copy of any official record of the Office of the 
Administrator that relates to this chapter. That copy shall be 
admissible in evidence with the same effect as the original.

``Sec. 1319. Correction of errors in certificates

    ``The Administrator may, by a certificate of correction under seal, 
correct any error in a registration incurred through the fault of the 
Office, or, upon payment of the required fee, any error of a clerical 
or typographical nature occurring in good faith but not through the 
fault of the Office. Such registration, together with the certificate, 
shall thereafter have the same effect as if it had been originally 
issued in such corrected form.

``Sec. 1320. Ownership and transfer

    ``(a) Property Right in Design.--The property right in a design 
subject to protection under this chapter shall vest in the designer, 
the legal representatives of a deceased designer or of one under legal 
incapacity, the employer for whom the designer created the design in 
the case of a design made within the regular scope of the designer's 
employment, or a person to whom the rights of the designer or of such 
employer have been transferred. The person in whom the property right 
is vested shall be considered the owner of the design.
    ``(b) Transfer of Property Right.--The property right in a 
registered design, or a design for which an application for 
registration has been or may be filed, may be assigned, granted, 
conveyed, or mortgaged by an instrument in writing, signed by the 
owner, or may be bequeathed by will.
    ``(c) Oath or Acknowledgement of Transfer.--An oath or 
acknowledgment under section 1312 shall be prima facie evidence of the 
execution of an assignment, grant, conveyance, or mortgage under 
subsection (b).
    ``(d) Recordation of Transfer.--An assignment, grant, conveyance, 
or mortgage under subsection (b) shall be void as against any 
subsequent purchaser or mortgagee for a valuable consideration, unless 
it is recorded in the Office of the Administrator within 3 months after 
its date of execution or before the date of such subsequent purchase or 
mortgage.

``Sec. 1321. Remedy for infringement

    ``(a) In General.--The owner of a design is entitled, after 
issuance of a certificate of registration of the design under this 
chapter, to institute an action for any infringement of the design.
    ``(b) Review of Refusal To Register.--(1) Subject to paragraph (2), 
the owner of a design may seek judicial review of a final refusal of 
the Administrator to register the design under this chapter by bringing 
a civil action, and may in the same action, if the court adjudges the 
design subject to protection under this chapter, enforce the rights in 
that design under this chapter.
    ``(2) The owner of a design may seek judicial review under this 
section if--
        ``(A) the owner has previously duly filed and prosecuted to 
    final refusal an application in proper form for registration of the 
    design;
        ``(B) the owner causes a copy of the complaint in the action to 
    be delivered to the Administrator within 10 days after the 
    commencement of the action; and
        ``(C) the defendant has committed acts in respect to the design 
    which would constitute infringement with respect to a design 
    protected under this chapter.
    ``(c) Administrator as Party to Action.--The Administrator may, at 
the Administrator's option, become a party to the action with respect 
to the issue of registrability of the design claim by entering an 
appearance within 60 days after being served with the complaint, but 
the failure of the Administrator to become a party shall not deprive 
the court of jurisdiction to determine that issue.
    ``(d) Use of Arbitration To Resolve Dispute.--The parties to an 
infringement dispute under this chapter, within such time as may be 
specified by the Administrator by regulation, may determine the 
dispute, or any aspect of the dispute, by arbitration. Arbitration 
shall be governed by title 9. The parties shall give notice of any 
arbitration award to the Administrator, and such award shall, as 
between the parties to the arbitration, be dispositive of the issues to 
which it relates. The arbitration award shall be unenforceable until 
such notice is given. Nothing in this subsection shall preclude the 
Administrator from determining whether a design is subject to 
registration in a cancellation proceeding under section 1313(c).

Sec. 1322. Injunctions

    ``(a) In General.--A court having jurisdiction over actions under 
this chapter may grant injunctions in accordance with the principles of 
equity to prevent infringement of a design under this chapter, 
including, in its discretion, prompt relief by temporary restraining 
orders and preliminary injunctions.
    ``(b) Damages for Injunctive Relief Wrongfully Obtained.--A seller 
or distributor who suffers damage by reason of injunctive relief 
wrongfully obtained under this section has a cause of action against 
the applicant for such injunctive relief and may recover such relief as 
may be appropriate, including damages for lost profits, cost of 
materials, loss of good will, and punitive damages in instances where 
the injunctive relief was sought in bad faith, and, unless the court 
finds extenuating circumstances, reasonable attorney's fees.

``Sec. 1323. Recovery for infringement

    ``(a) Damages.--Upon a finding for the claimant in an action for 
infringement under this chapter, the court shall award the claimant 
damages adequate to compensate for the infringement. In addition, the 
court may increase the damages to such amount, not exceeding $50,000 or 
$1 per copy, whichever is greater, as the court determines to be just. 
The damages awarded shall constitute compensation and not a penalty. 
The court may receive expert testimony as an aid to the determination 
of damages.
    ``(b) Infringer's Profits.--As an alternative to the remedies 
provided in subsection (a), the court may award the claimant the 
infringer's profits resulting from the sale of the copies if the court 
finds that the infringer's sales are reasonably related to the use of 
the claimant's design. In such a case, the claimant shall be required 
to prove only the amount of the infringer's sales and the infringer 
shall be required to prove its expenses against such sales.
    ``(c) Statute of Limitations.--No recovery under subsection (a) or 
(b) shall be had for any infringement committed more than 3 years 
before the date on which the complaint is filed.
    ``(d) Attorney's Fees.--In an action for infringement under this 
chapter, the court may award reasonable attorney's fees to the 
prevailing party.
    ``(e) Disposition of Infringing and Other Articles.--The court may 
order that all infringing articles, and any plates, molds, patterns, 
models, or other means specifically adapted for making the articles, be 
delivered up for destruction or other disposition as the court may 
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irect.

``Sec. 1324. Power of court over registration

    ``In any action involving the protection of a design under this 
chapter, the court, when appropriate, may order registration of a 
design under this chapter or the cancellation of such a registration. 
Any such order shall be certified by the court to the Administrator, 
who shall make an appropriate entry upon the record.

``Sec. 1325. Liability for action on registration fraudulently obtained

    ``Any person who brings an action for infringement knowing that 
registration of the design was obtained by a false or fraudulent 
representation materially affecting the rights under this chapter, 
shall be liable in the sum of $10,000, or such part of that amount as 
the court may determine. That amount shall be to compensate the 
defendant and shall be charged against the plaintiff and paid to the 
defendant, in addition to such costs and attorney's fees of the 
defendant as may be assessed by the court.

``Sec. 1326. Penalty for false marking

    ``(a) In General.--Whoever, for the purpose of deceiving the 
public, marks upon, applies to, or uses in advertising in connection 
with an article made, used, distributed, or sold, a design which is not 
protected under this chapter, a design notice specified in section 
1306, or any other words or symbols importing that the design is 
protected under this chapter, knowing that the design is not so 
protected, shall pay a civil fine of not more than $500 for each such 
offense.
    ``(b) Suit by Private Persons.--Any person may sue for the penalty 
established by subsection (a), in which event one-half of the penalty 
shall be awarded to the person suing and the remainder shall be awarded 
to the United States.

``Sec. 1327. Penalty for false representation

    ``Whoever knowingly makes a false representation materially 
affecting the rights obtainable under this chapter for the purpose of 
obtaining registration of a design under this chapter shall pay a 
penalty of not less than $500 and not more than $1,000, and any rights 
or privileges that individual may have in the design under this chapter 
shall be forfeited.

``Sec. 1328. Enforcement by Treasury and Postal Service

    ``(a) Regulations.--The Secretary of the Treasury and the United 
States Postal Service shall separately or jointly issue regulations for 
the enforcement of the rights set forth in section 1308 with respect to 
importation. Such regulations may require, as a condition for the 
exclusion of articles from the United States, that the person seeking 
exclusion take any one or more of the following actions:
        ``(1) Obtain a court order enjoining, or an order of the 
    International Trade Commission under section 337 of the Tariff Act 
    of 1930 excluding, importation of the articles.
        ``(2) Furnish proof that the design involved is protected under 
    this chapter and that the importation of the articles would 
    infringe the rights in the design under this chapter.
        ``(3) Post a surety bond for any injury that may result if the 
    detention or exclusion of the articles proves to be unjustified.
    ``(b) Seizure and Forfeiture.--Articles imported in violation of 
the rights set forth in section 1308 are subject to seizure and 
forfeiture in the same manner as property imported in violation of the 
customs laws. Any such forfeited articles shall be destroyed as 
directed by the Secretary of the Treasury or the court, as the case may 
be, except that the articles may be returned to the country of export 
whenever it is shown to the satisfaction of the Secretary of the 
Treasury that the importer had no reasonable grounds for believing that 
his or her acts constituted a violation of the law.

``Sec. 1329. Relation to design patent law

    ``The issuance of a design patent under title 35, United States 
Code, for an original design for an article of manufacture shall 
terminate any protection of the original design under this chapter.

``Sec. 1330. Common law and other rights unaffected

    ``Nothing in this chapter shall annul or limit--
        ``(1) common law or other rights or remedies, if any, available 
    to or held by any person with respect to a design which has not 
    been registered under this chapter; or
        ``(2) any right under the trademark laws or any right protected 
    against unfair competition.

``Sec. 1331. Administrator; Office of the Administrator

    ``In this chapter, the `Administrator' is the Register of 
Copyrights, and the `Office of the Administrator' and the `Office' 
refer to the Copyright Office of the Library of Congress.

``Sec. 1332. No retroactive effect

    ``Protection under this chapter shall not be available for any 
design that has been made public under section 1310(b) before the 
effective date of this chapter.''.

SEC. 503. CONFORMING AMENDMENTS.

    (a) Table of Chapters.--The table of chapters for title 17, United 
States Code, is amended by adding at the end the following:

``13. Protection of Original Designs.............................1301''.

    (b) Jurisdiction of District Courts Over Design Actions.--(1) 
Section 1338(c) of title 28, United States Code, is amended by 
inserting ``, and to exclusive rights in designs under chapter 13 of 
title 17,'' after ``title 17''.
    (2)(A) The section heading for section 1338 of title 28, United 
States Code, is amended by inserting ``designs,'' after ``mask 
works,''.
    (B) The item relating to section 1338 in the table of sections at 
the beginning of chapter 85 of title 28, United States Code, is amended 
by inserting ``designs,'' after ``mask works,''.
    (c) Place for Bringing Design Actions.--(1) Section 1400(a) of 
title 28, United States Code, is amended by inserting ``or designs'' 
after ``mask works''.
    (2) The section heading for section 1400 of title 28, United States 
Code, is amended to read as follows:

``Patents and copyrights, mask works, and designs''.

    (3) The item relating to section 1400 in the table of sections at 
the beginning of chapter 87 of title 28, United States Code, is amended 
to read as follows:

``1400.  Patents and copyrights, mask works, and designs.''.

    (d) Actions Against the United States.--Section 1498(e) of title 
28, United States Code, is amended by inserting ``, and to exclusive 
rights in designs under chapter 13 of title 17,'' after ``title 17''.

SEC. 504. JOINT STUDY OF THE EFFECT OF THIS TITLE.

    (a) In General.--Not later than 1 year after the date of the 
enactment of this Act, and not later than 2 years after such date of 
enactment, the Register of Copyrights and the Commissioner of Patents 
and Trademarks shall submit to the Committees on the Judiciary of the 
Senate and the House of Representatives a joint report evaluating the 
effect of the amendments made by this title.
    (b) Elements for Consideration.--In carrying out subsection (a), 
the Register of Copyrights and the Commissioner of Patents and 
Trademarks shall consider--
        (1) the extent to which the amendments made by this title has 
    been effective in suppressing infringement of the design of vessel 
    hulls;
        (2) the extent to which the registration provided for in 
    chapter 13 of title 17, United States Code, as added by this title, 
    has been utilized;
        (3) the extent to which the creation of new designs of vessel 
    hulls have been encouraged by the amendments made by this title;
        (4) the effect, if any, of the amendments made by this title on 
    the price of vessels with hulls protected under such amendments; 
    and
        (5) such other considerations as the Register and the 
    Commissioner may deem relevant to accomplish the purposes of the 
    evaluation conducted under subsection (a).

SEC. 505. EFFECTIVE DATE.

    The amendments made by sections 502 and 503 shall take effect on 
the date of the enactment of this Act and shall remain in effect until 
the end of the 2-year period beginning on such date of enactment. No 
cause of action based on chapter 13 of title 17, United States Code, as 
added by this title, may be filed after the end o
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f that 2-year period.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.

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