[DOCID: f:h2281pcs.txt]
                                                       Calendar No. 535

105th CONGRESS

  2d Session

                               H. R. 2281

_______________________________________________________________________

                                 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.

_______________________________________________________________________

                            August 31, 1998

            Received; read twice and placed on the calendar
                                                       Calendar No. 535
105th CONGRESS
  2d Session
                                H. R. 2281

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            August 31, 1998

            Received; read twice and placed on the calendar

_______________________________________________________________________

                                 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 COPYRIGHT TREATIES IMPLEMENTATION

Sec. 101. Short title.
Sec. 102. Technical amendments.
Sec. 103. Copyright protection systems and copyright management
                            information.
Sec. 104. Development and implementation of technological protection
                            measures.
Sec. 105. Evaluation of impact of copyright law and amendments on
                            electronic commerce and technological
                            development.
Sec. 106. 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

   Subtitle A--Establishment of the Under Secretary of Commerce for
                      Intellectual Property Policy

Sec. 401. Under Secretary of Commerce for Intellectual Property Policy.
Sec. 402. Relationship with existing authorities.
                     Subtitle B--Related Provisions

Sec. 411. Ephemeral recordings.
Sec. 412. Limitations on exclusive rights; distance education.
Sec. 413. Exemption for libraries and archives.
Sec. 414. Fair use.
Sec. 415. Scope of exclusive rights in sound recordings; ephemeral
                            recordings.
Sec. 416. Assumption of contractual obligations related to transfers of
                            rights in motion pictures.
Sec. 417. First sale clarification.
           TITLE V--COLLECTIONS OF INFORMATION ANTIPIRACY ACT

Sec. 501. Short title.
Sec. 502. Misappropriation of collections of information.
Sec. 503. Conforming amendment.
Sec. 504. Conforming amendments to title 28, United States Code.
Sec. 505. Effective date.
            TITLE VI--PROTECTION OF CERTAIN ORIGINAL DESIGNS

Sec. 601. Short title.
Sec. 602. Protection of certain original designs.
Sec. 603. Conforming amendments.
Sec. 604. Effective date.

            TITLE I--WIPO COPYRIGHT TREATIES IMPLEMENTATION

SEC. 101. SHORT TITLE.

    This title may be cited as the ``WIPO Copyright Treaties
Implementation Act''.

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 Phonograms 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.
``1203. Civil remedies.
``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)(i) The prohibition contained in subparagraph (A) shall not
apply to persons with respect to a copyrighted work which is in a
particular class of works and to which such persons have gained initial
lawful access, 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).
    ``(ii) The prohibition contained in subparagraph (A) shall not
apply to nonprofit libraries, archives, or educational institutions, or
to any entity described in section 501(c)(3), (4), or (6) of the
Internal Revenue Code of 1986 that is exempt from tax under section
501(a) of such Code, with respect to a particular class of works, if
such entities 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 Secretary of Commerce, in
consultation with the Under Secretary of Commerce for Intellectual
Property Policy, the Assistant Secretary of Commerce for Communications
and Information, and the Register of Copyrights, shall conduct a
rulemaking on the record to make the determination for purposes of
subparagraph (B) of whether nonprofit libraries, archives, or
educational institutions and other entities described in subparagraph
(B) or persons who have gained initial lawful access to 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
Secretary 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 of the prohibition on the circumvention
        of technological measures applied to copyrighted works 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 Secretary, in consultation
        with the Under Secretary of Commerce for Intellectual Property
        Policy, the Assistant Secretary of Commerce for Communications
        and Information, and the Register of Copyrights, considers
        appropriate.
    ``(D) The Secretary shall publish any class of copyrighted works
for which the Secretary has determined, pursuant to the rulemaking
conducted under subparagraph (C), that noninfringing uses by nonprofit
libraries, archives, or educational institutions and other entities
described in subparagraph (B) or by persons who have gained initial
lawful access to a copyrighted work are, or are likely to be, adversely
affected, and the prohibition contained in subparagraph (A) shall not
apply to such entities with respect to such class of works, or to such
persons with respect to such copyrighted work, 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, 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.
    ``(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 and Intelligence Activities.--This section
does not prohibit any lawfully authorized investigative, protective, 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.
    ``(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 for that person to make the
identification and analysis permitted under paragraph (1), or for the
limited purpose of that person achieving 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 paragraphs (1) and (2)
provides such information or means solely for the purpose of achieving
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 other applicable law.
    ``(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 of 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 Under Secretary of
        Commerce for Intellectual Property Policy, the Assistant
        Secretary of Commerce for Communications and Information, and
        the Register of Copyrights 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) Excpetions Regarding Minors.--(1) 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--
            ``(A) does not itself violate the provisions of this title;
        and
            ``(B) has the sole purpose to prevent the access of minors
        to material on the Internet.
    ``(2) Notwithstanding the provisions of subsection (a)(1)(A), it is
not a violation of that subsection for a parent to circumvent a
technological measure that effectively controls access to a test,
examination, or other evaluation of his or her minor child's abilities
that is given by a nonprofit educational institution if--
            ``(A) the parent made a good faith effort to obtain
        authorization before the circumvention; and
            ``(B) such act is necessary to obtain a copy of such test,
        examination, or other evaluation.
    ``(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.
``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 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 and Intelligence Activities.--This section
does not prohibit any lawfully authorized investigative, protective, 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.
    ``(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 product 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
        three 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
five 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. DEVELOPMENT AND IMPLEMENTATION OF TECHNOLOGICAL PROTECTION
              MEASURES.

    (a) Statement of Congressional Policy and Objective.--It is the
sense of the Congress that technological measures that effectively
control access to works protected under title 17, United States Code,
or that effectively protect a right of a copyright owner under such
title play a crucial role in safeguarding the interests of both
copyright owners and lawful users of copyrighted works in digital
formats, by facilitating lawful uses of such works while protecting the
private property interests of holders of rights under title 17, United
States Code. Accordingly, the expeditious implementation of such
measures, developed by the private sector is a key factor in realizing
the full benefits of making available copyrighted works through digital
networks, including the benefits set forth in this section.
    (b) Technological Measures.--The technological measures referred to
in subsection (a) shall include, but not be limited to, those which--
            (1) enable nonprofit libraries, for nonprofit purposes, to
        continue to lend to library users copies or phonorecords that
        such libraries have lawfully acquired, including the lending of
        such copies or phonorecords in digital formats in a manner that
        prevents infringement;
            (2) effectively protect against the infringement of
        exclusive rights under title 17, United States Code, and
        facilitate the exercise of those exclusive rights; and
            (3) promote the development and implementation of diverse
        methods, mechanisms, and arrangements in the marketplace for
        making available copyrighted works in digital formats which
        provide opportunities for individual members of the public to
        make lawful uses of copyrighted works in digital formats.
    (c) Procedures for Developing and Implementing Technological
Measures.--The technological measures whose development and
implementation the Congress anticipates include, but are not limited
to, those which--
            (1) are developed pursuant to a broad consensus in an open,
        fair, voluntary, and multi-industry process;
            (2) are made available on reasonable and nondiscriminatory
        terms; and
            (3) do not impose substantial costs or burdens on copyright
        owners or on manufacturers of hardware or software used in
        conjunction with copyrighted works in digital formats.
    (d) Oversight and Reporting.--(1) The Under Secretary of Commerce
for Intellectual Property Policy, the Assistant Secretary of Commerce
for Communications and Information, and the Register of Copyrights
shall jointly review the impact of the enactment of section 1201 of
title 17, United States Code, on the access of individual users to
copyrighted works in digital formats and shall jointly report annually
thereon to the Committees on the Judiciary and on Commerce of the House
of Representatives and the Committees on the Judiciary and on Commerce,
Science, and Transportation of the Senate.
    (2) Each report under paragraph (1) shall address the following
issues:
            (A) The status of the development and implementation of
        technological measures described in this section, including
        measures that advance the objectives of this section, and the
        effectiveness of such technological measures in protecting the
        private property interests of copyright owners under title 17,
        United States Code.
            (B) The degree to which individual lawful users of
        copyrighted works--
                    (i) have access to the Internet and digital
                networks generally;
                    (ii) are dependent upon such access for their use
                of copyrighted works;
                    (iii) have available to them other channels for
                obtaining and using copyrighted works, other than the
                Internet and digital networks generally;
                    (iv) are required to pay copyright owners or
                intermediaries for each lawful use of copyrighted works
                in digital formats to which they have access; and
                    (v) are able to utilize nonprofit libraries to
                obtain access, through borrowing without payment by the
                user, to copyrighted works in digital formats.
            (C) The degree to which infringement of copyrighted works
        in digital formats is occurring.
            (D) Whether and the extent to which section 1201 of title
        17, United States Code, is asserted as a basis for liability in
        claims brought against persons conducting research and
        development, including reverse engineering of copyrighted
        works, and the extent to which such claims constitute a serious
        impediment to the development and production of competitive
        goods and services.
            (E) The degree to which individual users of copyrighted
        materials in digital formats are able effectively to protect
        themselves against the use of technological measures to carry
        out or facilitate the undisclosed collection and dissemination
        of personally identifying information concerning the access to
        and use of such materials by such users.
            (F) Such other issues as the Under Secretary of Commerce
        for Intellectual Property Policy, the Assistant Secretary of
        Commerce for Communications and Information, and the Register
        of Copyrights identify as relevant to the impact of the
        enactment of section 1201 of title 17, United States Code, on
        the access of individual users to copyrighted works in digital
        formats.
    (3) The first report under this subsection shall be submitted not
later than one year after the date of the enactment of this Act, and
the last such report shall be submitted not later than three years
after the date of the enactment of this Act.
    (4) The reports under this subsection may include such
recommendations for additional legislative action as the Under
Secretary of Commerce for Intellectual Property Policy, the Assistant
Secretary of Commerce for Communications and Information, and the
Register of Copyrights consider advisable in order to further the
objectives of this section.

SEC. 105. EVALUATION OF IMPACT OF COPYRIGHT LAW AND AMENDMENTS ON
              ELECTRONIC COMMERCE AND TECHNOLOGICAL DEVELOPMENT.

    (a) Evaluation by Under Secretary of Commerce and Register of
Copyrights.--The Under Secretary of Commerce for Intellectual Property
Policy, the Assistant Secretary of Commerce for Communications and
Information, and the Register of Copyrights 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.
    (c) Report to Congress.--The Under Secretary of Commerce for
Intellectual Property Policy, the Assistant Secretary of Commerce for
Communications and Information, and the Register of Copyrights 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 (b), including any legislative recommendations the Under
Secretary, the Assistant Secretary, and the Register may have.

SEC. 106. EFFECTIVE DATE.

    (a) In General.--Subject to subsection (b), 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 (i), 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 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 (i), 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 (i),
        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 (4), 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) Limitation on liability of nonprofit educational
        institutions.--A nonprofit educational institution that is a
        service provider shall not be liable for monetary relief, or,
        except as provided in subsection (i), for injunctive or other
        equitable relief, by reason of the acts or omissions of a
        faculty member, administrative employee, student, or graduate
        student, unless such faculty member, administrative employee,
        student, or graduate student is exercising managerial or
        operational responsibilities that directly relate to the
        institution's function as a service provider.
            ``(3) 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
        (4), 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
                electronic 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.
            ``(4) 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 (i),
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)(4), 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)(4)(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) 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.
    ``(f) 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 material 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).
    ``(g) 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)(4)(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)(4)(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)(4)(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.
    ``(h) 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.
    ``(i) 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 accounts 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.
    ``(j) 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.
    ``(k) 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.
    ``(l) 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 (h); or
            ``(2) a service provider gaining access to, removing, or
        disabling access to material in cases in which such conduct is
        prohibited by law.
    ``(m) 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.''.
    (c) Effective Date.--The amendments made by this section take
effect on the date of the enactment of this Act.

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

   Subtitle A--Establishment of the Under Secretary of Commerce for
                      Intellectual Property Policy

SEC. 401. UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL PROPERTY POLICY.

    (a) Appointment.--There shall be within the Department of Commerce
an Under Secretary of Commerce for Intellectual Property Policy, who
shall be appointed by the President, by and with the advice and consent
of the Senate, at level II of the Executive Schedule. On or after the
effective date of this subtitle, the President may designate an
individual to serve as the Acting Under Secretary until the date on
which an Under Secretary qualifies under this subsection.
    (b) Duties.--The Under Secretary of Commerce for Intellectual
Property Policy, under the direction of the Secretary of Commerce,
shall perform the following functions with respect to intellectual
property policy:
            (1) In coordination with the Under Secretary of Commerce
        for International Trade, promote exports of goods and services
        of the United States industries that rely on intellectual
        property.
            (2) Advise the President, through the Secretary of
        Commerce, on national and certain international issues relating
        to intellectual property policy, including issues in the areas
        of patents, trademarks, and copyrights.
            (3) Advise Federal departments and agencies on matters of
        intellectual property protection in other countries.
            (4) Provide guidance, as appropriate, with respect to
        proposals by agencies to assist foreign governments and
        international intergovernmental organizations on matters of
        intellectual property protection.
            (5) Conduct programs and studies related to the
        effectiveness of intellectual property protection throughout
        the world.
            (6) Advise the Secretary of Commerce on programs and
        studies relating to intellectual property policy that are
        conducted, or authorized to be conducted, cooperatively with
        foreign patent and trademark offices and international
        intergovernmental organizations.
            (7) In coordination with the Department of State, conduct
        programs and studies cooperatively with foreign intellectual
        property offices and international intergovernmental
        organizations.
    (c) Deputy Under Secretaries.--To assist the Under Secretary of
Commerce for Intellectual Property Policy, the Under Secretary shall
appoint a Deputy Under Secretary for Patent Policy and a Deputy Under
Secretary for Trademark Policy, as members of the Senior Executive
Service in accordance with the provisions of title 5, United States
Code. The Deputy Under Secretaries shall perform such duties and
functions as the Under Secretary shall prescribe.
    (d) Compensation.--Section 5313 of title 5, United States Code, is
amended by adding at the end the following: ``Under Secretary of
Commerce for Intellectual Property Policy.''
    (e) Funding.--Funds available to the Patent and Trademark Office
shall be made available for all expenses of the Office of the Under
Secretary of Commerce for Intellectual Property Policy, subject to
prior approval in appropriations Acts. Amounts made available under
this subsection shall not exceed 2 percent of the projected annual
revenues of the Patent and Trademark Office from fees for services and
goods of that Office. The Secretary of Commerce shall determine the
budget requirements of the Office of the Under Secretary for
Intellectual Property Policy.
    (f) Consultation.--In connection with the performance of his or her
duties under this section, the Under Secretary shall, on appropriate
matters, consult with the Register of Copyrights.

SEC. 402. RELATIONSHIP WITH EXISTING AUTHORITIES.

    (a) No Derogation.--Nothing in section 401 shall derogate from the
duties of the United States Trade Representative or from the duties of
the Secretary of State. In addition, nothing in this subtitle shall
derogate from the duties and functions of the Register of Copyrights or
otherwise alter current authorities relating to copyright matters.
    (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 chapters 9,
        12, 13, and 14 of 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 chapters 9, 12, 13, and 14 of 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 chapters 9, 12, 13, and 14 of 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 chapters 9, 12, 13, and 14 of 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.''

                     Subtitle B--Related Provisions

SEC. 411. 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)''; and
            (3) 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 that broadcasts a performance of a
        sound recording in a digital format on a nonsubscription
        basis,''; and
            (4) 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. 412. 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. 413. 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,''; and
                    (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 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. 414. FAIR USE.

    Section 107 of title 17, United States Code, is amended in the
first sentence by striking ``, including such use'' and all that
follows through ``section,''.

SEC. 415. 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) 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) or an eligible nonsubscription digital audio
        transmission shall be subject to statutory licensing, in
        accordance with subsection (f) if--
                    ``(A) in the case of a subscription transmission
                not exempt under paragraph (1) or an eligible
                nonsubscription transmission--
                            ``(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 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) by a preexisting
                subscription service in the same transmission medium
                used by such service on July 31, 1998--
                            ``(i) the transmission does not exceed the
                        sound recording performance complement;
                            ``(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) 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 the broadcast station
                        makes broadcast transmissions--
                                    ``(I) in digital format that
                                regularly exceed the sound recording
                                performance complement; or
                                    ``(II) in analog format, a
                                substantial portion of which, on a
                                weekly basis, exceed the sound
                                recording performance complement;
                        Provided, however, That 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 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 any 1-
                        hour period, no more than 3 such announcements
                        are made with respect to no more than 2 artists
                        in each announcement;
                            ``(iii) the transmission is not part of--
                                    ``(I) an archived program of less
                                than 5 hours duration;
                                    ``(II) an archived program of
                                greater than 5 hours duration that is
                                made available for a period exceeding 2
                                weeks;
                                    ``(III) a continuous program which
                                is of less than 3 hours duration; or
                                    ``(IV) a program, other than an
                                archived or continuous program, that is
                                transmitted at a scheduled time more
                                than 3 additional times in a 2-week
                                period following the first transmission
                                of the program and for an additional 2-
                                week period more than 1 month following
                                the end of the first such 2-week
                                period;
                            ``(iv) the transmitting entity does not
                        knowingly perform the sound recording 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 together
                        with transmissions by other transmitting
                        entities to select a particular sound recording
                        to be transmitted to the transmission
                        recipient;
                            ``(vi) the transmitting entity takes
                        reasonable steps to ensure, to the extent
                        within its control, that the transmission
                        recipient cannot make a phonorecord in a
                        digital format of the transmission, and the
                        transmitting entity takes no affirmative steps
                        to cause or induce the making of a phonorecord
                        by the transmission recipient;
                            ``(vii) phonorecords of the sound recording
                        have been distributed to the public in the
                        United States 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 this title;
                            ``(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; and
                            ``(ix) in the case of an eligible
                        nonsubscription transmission, the transmitting
                        entity identifies 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 perceived
                        by the transmission recipient, 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.''.
            (2) Subsection (f) is amended to read as follows:
                    (A) 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
                                    (III) by striking ``2000'' and
                                inserting ``2001''; and
                            (ii) by amending the third sentence to read
                        as follows: ``Any copyright owners of sound
                        recordings or any preexisting subscription
                        services may submit to the Librarian of
                        Congress licenses covering such subscriptions
                        transmissions with respect to such sound
                        recordings.''; and
                    (B) 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 preexisting
        subscription services. In establishing rates and terms for
        preexisting subscription 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).
            ``(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 preexisting subscription 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 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 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 section
        may submit to the Librarian of Congress licenses covering such
        eligible nonsubscription transmissions 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 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 copyright user 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.
            ``(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 if
                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 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.
            ``(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
                ``Subscription'';
                    (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 redesignating paragraphs (2), (3), (5), (6),
                (7), and (8) as paragraphs (3), (5), (9), (11), (12),
                and (13), respectively;
                    (B) by inserting after paragraph (1) the following:
            ``(2) An `archived program' is a prerecorded program that
        is available repeatedly on demand and that is performed in the
        same predetermined order from the beginning.'';
                    (C) by inserting after paragraph (3), as so
                redesignated, the following:
            ``(4) A `continuous program' is a prerecorded program that
        is continuously performed in the same predetermined order and
        the point in the program at which it is accessed 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 transmission 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
        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 subscription digital
        audio transmissions and that is not a preexisting subscription
        service.'';
                    (E) by inserting after paragraph (9), as so
                redesignated, the following:
            ``(10) 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 transmission to the public for
        a fee on or before July 31, 1998.''; and
                    (F) by adding at the end the following:
            ``(14) A `transmission' is either an initial transmission
        or a retransmission.''.
    (b) Ephemeral Recordings.--Section 112 of title 17, United States
Code, is amended by adding at the end the following:
    ``(f) Statutory License.--(1) An ephemeral recording of a sound
recording by a transmitting organization entitled to transmit to the
public a performance of that sound recording by means of a digital
audio transmission under a statutory license in accordance with section
114(f) or an exemption provided in section 114(d)(1)(B) or (C) is
subject to statutory licensing under the conditions specified by this
subsection.
    ``(2) A statutory license under this subsection grants a
transmitting organization entitled to transmit to the public a
performance of a sound recording by means of a digital audio
transmission under a statutory license in accordance with section
114(f) or an exemption provided in section 114(d)(1)(B) or (C) the
privilege of making no more than 1 phonorecord of the sound recording
(unless the terms and conditions of the statutory license allow for
more), if--
            ``(A) the phonorecord is retained and used solely by the
        transmitting organization that made it, and no further
        phonorecords are reproduced from it; and
            ``(B) the phonorecord is used solely for the transmitting
        organization's own transmissions in the United States under a
        statutory license in accordance with section 114(f) or an
        exemption provided in section 114(d)(1)(B) or (C);
            ``(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; and
            ``(D) phonorecords of the sound recording have been
        distributed to the public in the United States 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 and acquired under this title.
    ``(3) Notwithstanding any provision of the antitrust laws, any
copyright owners of sound recordings and any transmitting organizations
entitled to obtain a statutory license under this subsection may
negotiate and agree upon royalty rates and license terms and conditions
for ephemeral recordings of such sound recordings 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. Any
copyright owners of sound recordings or any transmitting organizations
entitled to obtain 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 obtain 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.
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;
            ``(B) the relative rules of the copyright owner and the
        copyright user 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 an ephemeral recording 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 within
the meaning of 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.''.

SEC. 416. 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.--In the case of a transfer of
copyright ownership in a motion picture (as 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--
            ``(1) 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
            ``(2) 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.
    ``(b) 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)(2), the transferor shall be liable
to the transferee for any damages suffered by the transferee as a
result of the failure to notify.
    ``(c) Determination of Disputes and Claims.--Any dispute concerning
the application of subsection (a) and any claim made under subsection
(b) 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.''.
    (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 Obligations4001''.<plus-minus>

SEC. 417. FIRST SALE CLARIFICATION.

    Section 109(a) of title 17, United States Code, is amended by
striking the first sentence and inserting the following:
``Notwithstanding the provisions of section 106(3), the owner of a
particular lawfully made copy or phonorecord that has been distributed
in the United States by the authority of the copyright owner, or any
person authorized by the owner of that copy or phonorecord, is
entitled, without the authority of the copyright owner, to sell or
otherwise dispose of the possession of that copy or phonorecord.''.

           TITLE V--COLLECTIONS OF INFORMATION ANTIPIRACY ACT

SEC. 501. SHORT TITLE.

    This title may be cited as the ``Collections of Information
Antipiracy Act''.

SEC. 502. MISAPPROPRIATION OF COLLECTIONS OF INFORMATION.

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

      ``CHAPTER 13--MISAPPROPRIATION OF COLLECTIONS OF INFORMATION

``Sec.
``1301. Definitions.
``1302. Prohibition against misappropriation.
``1303. Permitted acts.
``1304. Exclusions.
``1305. Relationship to other laws.
``1306. Civil remedies.
``1307. Criminal offenses and penalties.
``1308. Limitations on actions.
``Sec. 1301. Definitions
    ``As used in this chapter:
            ``(1) Collection of information.--The term `collection of
        information' means information that has been collected and has
        been organized for the purpose of bringing discrete items of
        information together in one place or through one source so that
        users may access them.
            ``(2) Information.--The term `information' means facts,
        data, works of authorship, or any other intangible material
        capable of being collected and organized in a systematic way.
            ``(3) Potential market.--The term `potential market' means
        any market that a person claiming protection under section 1302
        has current and demonstrable plans to exploit or that is
        commonly exploited by persons offering similar products or
        services incorporating collections of information.
            ``(4) Commerce.--The term `commerce' means all commerce
        which may be lawfully regulated by the Congress.
            ``(5) Product or service.--A product or service
        incorporating a collection of information does not include a
        product or service incorporating a collection of information
        gathered, organized, or maintained to address, route, forward,
        transmit, or store digital online communications or provide or
        receive access to connections for digital online
        communications.
``Sec. 1302. Prohibition against misappropriation
    ``Any person who extracts, or uses in commerce, all or a
substantial part, measured either quantitatively or qualitatively, of a
collection of information gathered, organized, or maintained by another
person through the investment of substantial monetary or other
resources, so as to cause harm to the actual or potential market of
that other person, or a successor in interest of that other person, for
a product or service that incorporates that collection of information
and is offered or intended to be offered for sale or otherwise in
commerce by that other person, or a successor in interest of that
person, shall be liable to that person or successor in interest for the
remedies set forth in section 1306.
``Sec. 1303. Permitted acts
    ``(a) Individual Items of Information and Other Insubstantial
Parts.--Nothing in this chapter shall prevent the extraction or use of
an individual item of information, or other insubstantial part of a
collection of information, in itself. An individual item of
information, including a work of authorship, shall not itself be
considered a substantial part of a collection of information under
section 1302. Nothing in this subsection shall permit the repeated or
systematic extraction or use of individual items or insubstantial parts
of a collection of information so as to circumvent the prohibition
contained in section 1302.
    ``(b) Gathering or Use of Information Obtained Through Other
Means.--Nothing in this chapter shall restrict any person from
independently gathering information or using information obtained by
means other than extracting it from a collection of information
gathered, organized, or maintained by another person through the
investment of substantial monetary or other resources.
    ``(c) Use of Information for Verification.--Nothing in this chapter
shall restrict any person from extracting or using a collection of
information within any entity or organization, for the sole purpose of
verifying the accuracy of information independently gathered,
organized, or maintained by that person. Under no circumstances shall
the information so used be extracted from the original collection and
made available to others in a manner that harms the actual or potential
market for the collection of information from which it is extracted or
used.
    ``(d) Nonprofit Educational, Scientific, or Research Uses.--
Notwithstanding section 1302, no person shall be restricted from
extracting or using information for nonprofit educational, scientific,
or research purposes in a manner that does not harm directly the actual
market for the product or service referred to in section 1302.
    ``(e) News Reporting.--Nothing in this chapter shall restrict any
person from extracting or using information for the sole purpose of
news reporting, including news gathering, dissemination, and comment,
unless the information so extracted or used is time sensitive and has
been gathered by a news reporting entity, and the extraction or use is
part of a consistent pattern engaged in for the purpose of direct
competition.
    ``(f) Transfer of Copy.--Nothing in this chapter shall restrict the
owner of a particular lawfully made copy of all or part of a collection
of information from selling or otherwise disposing of the possession of
that copy.
``Sec. 1304. Exclusions
    ``(a) Government Collections of Information.--
            ``(1) Exclusion.--Protection under this chapter shall not
        extend to collections of information gathered, organized, or
        maintained by or for a government entity, whether Federal,
        State, or local, including any employee or agent of such
        entity, or any person exclusively licensed by such entity,
        within the scope of the employment, agency, or license. Nothing
        in this subsection shall preclude protection under this chapter
        for information gathered, organized, or maintained by such an
agent or licensee that is not within the scope of such agency or
license, or by a Federal or State educational institution in the course
of engaging in education or scholarship.
            ``(2) Exception.--The exclusion under paragraph (1) does
        not apply to any information required to be collected and
        disseminated--
                    ``(A) under the Securities Exchange Act of 1934 by
                a national securities exchange, a registered securities
                association, or a registered securities information
                processor, subject to section 1305(g) of this title; or
                    ``(B) under the Commodity Exchange Act by a
                contract market, subject to section 1305(g) of this
                title.
    ``(b) Computer Programs.--
            ``(1) Protection not extended.--Subject to paragraph (2),
        protection under this chapter shall not extend to computer
        programs, including, but not limited to, any computer program
        used in the manufacture, production, operation, or maintenance
        of a collection of information, or any element of a computer
        program necessary to its operation.
            ``(2) Incorporated collections of information.--A
        collection of information that is otherwise subject to
        protection under this chapter is not disqualified from such
        protection solely because it is incorporated into a computer
        program.
``Sec. 1305. Relationship to other laws
    ``(a) Other Rights Not Affected.--Subject to subsection (b),
nothing in this chapter shall affect rights, limitations, or remedies
concerning copyright, or any other rights or obligations relating to
information, including laws with respect to patent, trademark, design
rights, antitrust, trade secrets, privacy, access to public documents,
and the law of contract.
    ``(b) Preemption of State Law.--On or after the effective date of
this chapter, all rights that are equivalent to the rights specified in
section 1302 with respect to the subject matter of this chapter shall
be governed exclusively by Federal law, and no person is entitled to
any equivalent right in such subject matter under the common law or
statutes of any State. State laws with respect to trademark, design
rights, antitrust, trade secrets, privacy, access to public documents,
and the law of contract shall not be deemed to provide equivalent
rights for purposes of this subsection.
    ``(c) Relationship to Copyright.--Protection under this chapter is
independent of, and does not affect or enlarge the scope, duration,
ownership, or subsistence of, any copyright protection or limitation,
including, but not limited to, fair use, in any work of authorship that
is contained in or consists in whole or part of a collection of
information. This chapter does not provide any greater protection to a
work of authorship contained in a collection of information, other than
a work that is itself a collection of information, than is available to
that work under any other chapter of this title.
    ``(d) Antitrust.--Nothing in this chapter shall limit in any way
the constraints on the manner in which products and services may be
provided to the public that are imposed by Federal and State antitrust
laws, including those regarding single suppliers of products and
services.
    ``(e) Licensing.--Nothing in this chapter shall restrict the rights
of parties freely to enter into licenses or any other contracts with
respect to the use of collections of information.
    ``(f) Communications Act of 1934.--Nothing in this chapter shall
affect the operation of the provisions of the Communications Act of
1934 (47 U.S.C. 151 et seq.), or shall restrict any person from
extracting or using subscriber list information, as such term is
defined in section 222(f)(3) of the Communications Act of 1934 (47
U.S.C. 222(f)(3)), for the purpose of publishing telephone directories
in any format.
    ``(g) Securities and Commodities Market Information.--
            ``(1) Federal agencies and acts.--Nothing in this Act shall
        affect:
                    ``(A) the operation of the provisions of the
                Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.)
                or the Commodity Exchange Act (7 U.S.C. 1 et seq.);
                    ``(B) the jurisdiction or authority of the
                Securities and Exchange Commission and the Commodity
                Futures Trading Commission; or
                    ``(C) the functions and operations of self-
                regulatory organizations and securities information
                processors under the provisions of the Securities
                Exchange Act of 1934 and the rules and regulations
                thereunder, including making market information
                available pursuant to the provisions of that Act and
                the rules and regulations promulgated thereunder.
            ``(2) Prohibition.--Notwithstanding any provision in
        subsection (a), (b), (c), (d), or (f) of section 1303, nothing
        in this chapter shall permit the extraction, use, resale, or
        other disposition of real-time market information except as the
        Securities Exchange Act of 1934, the Commodity Exchange Act,
        and the rules and regulations thereunder may otherwise provide.
        In addition, nothing in subsection (e) of section 1303 shall be
        construed to permit any person to extract or use real-time
        market information in a manner that constitutes a market
        substitute for a real-time market information service
        (including the real-time systematic updating of or display of a
        substantial part of market information) provided on a real-time
        basis.
            ``(3) Definition.--As used in this subsection, the term
        `market information' means information relating to quotations
        and transactions that is collected, processed, distributed, or
        published pursuant to the provisions of the Securities Exchange
        Act of 1934 or by a contract market that is designated by the
        Commodity Futures Trading Commission pursuant to the Commodity
        Exchange Act and the rules and regulations thereunder.
``Sec. 1306. Civil remedies
    ``(a) Civil Actions.--Any person who is injured by a violation of
section 1302 may bring a civil action for such a violation in an
appropriate United States district court without regard to the amount
in controversy, except that any action against a State governmental
entity may be brought in any court that has jurisdiction over claims
against such entity.
    ``(b) Temporary and Permanent Injunctions.--Any court having
jurisdiction of a civil action under this section shall have the power
to grant temporary and permanent injunctions, according to the
principles of equity and upon such terms as the court may deem
reasonable, to prevent a violation of section 1302. Any such injunction
may be served anywhere in the United States on the person enjoined, and
may be enforced by proceedings in contempt or otherwise by any United
States district court having jurisdiction over that person.
    ``(c) Impoundment.--At any time while an action under this section
is pending, the court may order the impounding, on such terms as it
deems reasonable, of all copies of contents of a collection of
information extracted or used in violation of section 1302, and of all
masters, tapes, disks, diskettes, or other articles by means of which
such copies may be reproduced. The court may, as part of a final
judgment or decree finding a violation of section 1302, order the
remedial modification or destruction of all copies of contents of a
collection of information extracted or used in violation of section
1302, and of all masters, tapes, disks, diskettes, or other articles by
means of which such copies may be reproduced.
    ``(d) Monetary Relief.--When a violation of section 1302 has been
established in any civil action arising under this section, the
plaintiff shall be entitled to recover any damages sustained by the
plaintiff and defendant's profits not taken into account in computing
the damages sustained by the plaintiff. The court shall assess such
profits or damages or cause the same to be assessed under its
direction. In assessing profits the plaintiff shall be required to
prove defendant's gross revenue only and the defendant shall be
required to prove all elements of cost or deduction claims. In
assessing damages the court may enter judgment, according to the
circumstances of the case, for any sum above the amount found as actual
damages, not exceeding three times such amount. The court in its
discretion may award reasonable costs and attorney's fees to the
prevailing party and shall award such costs and fees where it
determines that an action was brought under this chapter in bad faith
against a nonprofit educational, scientific, or research institution,
library, or archives, or an employee or agent of such an entity, acting
within the scope of his or her employment.
    ``(e) Reduction or Remission of Monetary Relief for Nonprofit
Educational, Scientific, or Research Institutions.--The court shall
reduce or remit entirely monetary relief under subsection (d) in any
case in which a defendant believed and had reasonable grounds for
believing that his or her conduct was permissible under this chapter,
if the defendant was an employee or agent of a nonprofit educational,
scientific, or research institution, library, or archives acting within
the scope of his or her employment.
    ``(f) Actions Against United States Government.--Subsections (b)
and (c) shall not apply to any action against the United States
Government.
    ``(g) Relief Against State Entities.--The relief provided under
this section shall be available against a State governmental entity to
the extent permitted by applicable law.
``Sec. 1307. Criminal offenses and penalties
    ``(a) Violation.--
            ``(1) In general.--Any person who violates section 1302
        willfully, and--
                    ``(A) does so for direct or indirect commercial
                advantage or financial gain; or
                    ``(B) causes loss or damage aggregating $10,000 or
                more in any 1-year period to the person who gathered,
                organized, or maintained the information concerned,
        shall be punished as provided in subsection (b).
            ``(2) Inapplicability.--This section shall not apply to an
        employee or agent of a nonprofit educational, scientific, or
        research institution, library, or archives acting within the
        scope of his or her employment.
    ``(b) Penalties.--An offense under subsection (a) shall be
punishable by a fine of not more than $250,000 or imprisonment for not
more than 5 years, or both. A second or subsequent offense under
subsection (a) shall be punishable by a fine of not more than $500,000
or imprisonment for not more than 10 years, or both.
``Sec. 1308. Limitations on actions
    ``(a) Criminal Proceedings.--No criminal proceeding shall be
maintained under this chapter unless it is commenced within three years
after the cause of action arises.
    ``(b) Civil Actions.--No civil action shall be maintained under
this chapter unless it is commenced within three years after the cause
of action arises or claim accrues.
    ``(c) Additional Limitation.--No criminal or civil action shall be
maintained under this chapter for the extraction or use of all or a
substantial part of a collection of information that occurs more than
15 years after the investment of resources that qualified the portion
of the collection of information for protection under this chapter that
is extracted or used.''.

SEC. 503. CONFORMING AMENDMENT.

    The table of chapters for title 17, United States Code, is amended
by adding at the end the following:

``13. Misappropriation of Collections of Information........    1301''.

SEC. 504. CONFORMING AMENDMENTS TO TITLE 28, UNITED STATES CODE.

    (a) District Court Jurisdiction.--Section 1338 of title 28, United
States Code, is amended--
            (1) in the section heading by inserting ``misappropriations
        of collections of information,'' after ``trade-marks,''; and
            (2) by adding at the end the following:
    ``(d) The district courts shall have original jurisdiction of any
civil action arising under chapter 13 of title 17, relating to
misappropriation of collections of information. Such jurisdiction shall
be exclusive of the courts of the States, except that any action
against a State governmental entity may be brought in any court that
has jurisdiction over claims against such entity.''.
    (b) Conforming Amendment.--The item relating to section 1338 in the
table of sections for chapter 85 of title 28, United States Code, is
amended by inserting ``misappropriations of collections of
information,'' after ``trade-marks,''.
    (c) Court of Federal Claims Jurisdiction.--Section 1498(e) of title
28, United States Code, is amended by inserting ``and to protections
afforded collections of information under chapter 13 of title 17''
after ``chapter 9 of title 17''.

SEC. 505. EFFECTIVE DATE.

    (a) In General.--This title and the amendments made by this title
shall take effect on the date of the enactment of this Act, and shall
apply to acts committed on or after that date.
    (b) Prior Acts Not Affected.--No person shall be liable under
chapter 13 of title 17, United States Code, as added by section 502 of
this Act, for the use of information lawfully extracted from a
collection of information prior to the effective date of this Act, by
that person or by that person's predecessor in interest.

            TITLE VI--PROTECTION OF CERTAIN ORIGINAL DESIGNS

SEC. 601. SHORT TITLE.

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

SEC. 602. PROTECTION OF CERTAIN ORIGINAL DESIGNS.

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

              ``CHAPTER 14--PROTECTION OF ORIGINAL DESIGNS

``Sec.
``1401. Designs protected.
``1402. Designs not subject to protection.
``1403. Revisions, adaptations, and rearrangements.
``1404. Commencement of protection.
``1405. Term of protection.
``1406. Design notice.
``1407. Effect of omission of notice.
``1408. Exclusive rights.
``1409. Infringement.
``1410. Application for registration.
``1411. Benefit of earlier filing date in foreign country.
``1412. Oaths and acknowledgments.
``1413. Examination of application and issue or refusal of
                            registration.
``1414. Certification of registration.
``1415. Publication of announcements and indexes.
``1416. Fees.
``1417. Regulations.
``1418. Copies of records.
``1419. Correction of errors in certificates.
``1420. Ownership and transfer.
``1421. Remedy for infringement.
``1422. Injunctions.
``1423. Recovery for infringement.
``1424. Power of court over registration.
``1425. Liability for action on registration fraudulently obtained.
``1426. Penalty for false marking.
``1427. Penalty for false representation.
``1428. Enforcement by Treasury and Postal Service .
``1429. Relation to design patent law.
``1430. Common law and other rights unaffected.
``1431. Administrator; Office of the Administrator.
``1432. No retroactive effect.
``Sec. 1401. 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 1402(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. 1402. 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. 1403. 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 1402 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. 1404. 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 1413(a) or the date the design is first made
public as defined by section 1410(b).
``Sec. 1405. 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 1404.
    ``(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. 1406. Design notice
    ``(a) Contents of Design Notice.--(1) Whenever any design for which
protection is sought under this chapter is made public under section
1410(b), the owner of the design shall, subject to the provisions of
section 1407, 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 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. 1407. Effect of omission of notice
    ``(a) Actions With Notice.--Except as provided in subsection (b),
the omission of the notice prescribed in section 1406 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 1406 shall prevent any recovery under section
1423 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. 1408. 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. 1409. Infringement
    ``(a) Acts of Infringement.--Except as provided in subjection (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. 1410. 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 two 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 previously 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 1406, 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. 1411. 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. 1412. 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. 1413. 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 1410, and upon payment of the fee prescribed under section
1416, 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. 1414. 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. 1415. Publication 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. 1416. 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. 1417. Regulations
    ``The Administrator may establish regulations for the
administration of this chapter.
``Sec. 1418. 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. 1419. 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. 1420. 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 1412 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. 1421. 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 1413(c).
Sec. 1422. 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. 1423. 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
direct.
``Sec. 1424. 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. 1425. 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. 1426. 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
1406, 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. 1427. 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. 1428. 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 1408 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 1408 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. 1429. Relation to design patent law
    ``The issuance of a design patent under title 35 for an original
design for an article of manufacture shall terminate any protection of
the original design under this chapter.
``Sec. 1430. 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. 1431. 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. 1432. No retroactive effect
    ``Protection under this chapter shall not be available for any
design that has been made public under section 1410(b) before the
effective date of this chapter.''.

SEC. 603. 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:

``14. Protection of Original Designs........................    1401''.
    (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 14 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.--Section 1400(a) of title
28, United States Code, is amended by inserting ``or designs'' after
``mask works''.
    (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 14 of title 17,'' after ``title 17''.

SEC. 604. EFFECTIVE DATE.

    The amendments made by sections 602 and 603 shall take effect one
year after the date of the enactment of this Act.

            Passed the House of Representatives August 4, 1998.

            Attest:

                                                ROBIN H. CARLE,

                                                                 Clerk.
