infringement. It viewed the problem differently than the Rather the question was whether "Congress...exhibited the intent to limit the rights of use. The court remanded the case for fashioning of an ap- Congressional Action It is entirely appropriate for Congress to step into 96-601 0-82--3 focused on the issue when it passed the 1976 revision. Secondly it is certainly appropriate for Congress to grant broad exemption under the copyright law to certain classes of users of copyrighted material. The copyright law already contains provisions for compulsory licenses and outright exemptions for persons who otherwise would be considered infringers. We have had a compulsary license for making records of copyrighted music for over 70 years, first in Section 1(e) of the 1909 law and now in Section 115 of the new law. Congress established a fee of 2 cents under the old law and 2-3/4 cents under the new law. Section 111 has a compulsary license provision for cable systems. Section 118 provides a special procedure for public broadcasting entities using certain types of literary works. More to the point, the statute has specific exemptions for certain kinds of uses which would otherwise be considered an infringement. Section 110 begins broadly that "notwithstanding the provisions of section 106 the following are not infringements of copyright:" Then follows outright exemptions for educational uses of certain works, religious uses, uses for charitable solicitation, uses in non-profit agricultural or horticultural fairs, uses directed to blind or handicapped persons and so on. Even though the uses would otherwise violate Section 106 rights, Congress determined that the uses specified in Section 110 should be permitted. Congress also specified other uses that would not lead to liability. In Section 504 (c)(2) Congress established certain minimum and maximum levels for statutory damages. For innocent infringers were infringements - those who did not know their acts the limits were $10,000 maximum to $100 minimum for all infringements of one work. But employees of libraries, schools or archives who made photocopies, thinking that it would be considered fair use but who were later found to be infringers are exempt from even the $100 minimum. (Since no profits are involved and it is difficult to determine actual damages, presumably such persons are totally exempt from any damage award). Thus there already exists in the statute precisely the type of exemption contemplated by S.1758. Reasons for the Proposed Bill As for the wisdom or desirability of the bill, I believe it is an entirely reasonable response to the new technology. In some ways it fits precisely within the already existing exemption in Section 110(5) which exempts any "communication of a transmission embodying a performance or display of a work by the public reception of the transmission on a single receiving apparatus of a kind commonly used in private homes... In other words the reception of the TV signal is not a performance of the work, nor should a single recording of it for private home use. I think it is undesirable for the Ninth Circuit decision in the copyright law is totally unsuited to meet a finding of infringement in this type of situation. Privacy: The Ninth Circuit decision finds that the recording of a copyrighted work by a videotape recorder is an infringement. Unlike the situation where a person buys a cassette of a film in a store and pays a royalty on the purchase, the decision requires a consumer to pay for what he does at home. No matter how ingenious a remedy can be worked out, it is still necessary to determine what programs a consumer records to allocate damages or royalties. This is an entirely undesirable extention of government intrusion into the home even for the best of reasons. Remedy: The existing law simply cannot cope with the remedy now required after the Ninth Circuit decision. In theory each consumer must pay a minimum of $100 for each act of recording of each copyrighted show under Section 504(c)(2). Or Sony must pay that amount on their behalf and charge consumers additional amounts to cover that cost. Obviously that is an absurd measure. But the law has nothing else available to it. To say the courts may fashion a remedy is no answer. The courts can only fashion a remedy within existing law which has the $100 minimum per act of infringement. must step into the situation one way or another. must reject the decision or give a court other alternate damage remedies to cover this unusual situation. cannot stand idly by. Congress Either it But it Senator DECONCINI. Is Senator Denton here? Senator D'AMATO. I do not believe he is. He is on the Floor. Senator DECONCINI. Our next panel of witnesses consists of Mr. Jack Wayman, senior vice president of Consumer Electronic Group; Mr. Joseph Lagore, president of Sony Consumer Products Co.; and Mr. Julius Kretzer, who will be introduced by Senator Denton. Also, I have a statement from Senator Heflin welcoming you here, Mr. Kretzer. Mr. Wayman is accompanied by Mr. Day. Is that correct? Senator DECONCINI. Very good. Mr. Wayman, would you please proceed? Mr. WAYMAN. If we may, could we have Mr. Lagore go first? Senator DECONCINI. Surely. Mr. Lagore, please go right ahead. STATEMENT OF JOSEPH LAGORE, PRESIDENT, SONY CONSUMER PRODUCTS CO., ACCOMPANIED BY DEAN DUNLAVEY, COUNSEL; IRA GOMBERG, GENERAL COUNSEL; AND WILLIAM BAKER, VICE PRESIDENT, COMMUNICATIONS Mr. LAGORE. Mr. Chairman, my name is Joseph Lagore, president of Sony Consumer Products Co., a division of Sony Corp. of America. I have been in the consumer electronics industry for more than 20 years, and for the past several years I have been responsible for marketing the Sony Betamax machine as well as other Sony products. With me today is Mr. Dean Dunlavey, an attorney with Gibson, Dunn, Crutcher of Los Angeles. Also with me are Ira Gomberg, our general counsel, and Mr. William Baker, our vice president of communications. Sony is very pleased to have this chance to testify here before this committee. The proposed legislation you are considering is, in our opinion, of great importance. It is important not only to our industry, but it is also very important, we believe, to consumers, small businessmen across the country, and to many others who benefit either directly or indirectly from the availability of this technology. Additionally, the controversy that provides the basis for this proposed legislation raises questions affecting the privacy of all citizens of this country. Our paramount concerns are these: One, the court ruling intrudes on the privacy of the American citizen in his own home. The hundreds of editorials, columns, cartoons, and other media comment supportive of the consumer's position in this matter have focused on this important aspect. This book beside me has that information [indicating book]. Two, what we are talking about here is videotaping for private, noncommercial use of programing broadcast over public airwaves. There are more than 1,000 publicly licensed television stations in existence today, and in excess of 1,500 more are planned for the immediate future. These stations provide literally millions of hours of programing, offering consumers a very wide choice. Under Federal law, these stations are required to serve the public interest, convenience, and necessity, and their broadcasts are for the use of the general public. |