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Study 5: the Compulsory License Provisions of the U.S. Copyright

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Study 5: the Compulsory License Provisions of the U.S. Copyright 86th CODgrMII} 1st 8eBaion CO~TTEE PB~ COPYRIGHT LAW REVISION 1 STUDIES PREPARED FOR THE SUBCOMMITTEE ON PATENTS, TRADEMARKS, AND COPYRIGHTS OF THE COMMITTEE ON THE JUDICIARY UNITED STATES SENATE EIGHTY-SIXTH CONGRESS, FIRST SESSION PURSUANT TO S. Res. 53 STUDIES 5-6 5. The Compulsory License Provisions of the U.S. Copyright Law 6. The Economic Aspects of the Compulsory License .. Printed for the use of the Committee on the Judiciary --f UNITED STATES GOVERNMENT PRINTING OFFICE WASIDNGTON : 1960 I , COMMITTEE ON THE JUDICIARY JAMES O. EASTLAND, Mississippi, Chairman ESTES KEFAUVER, Tennessee ALEXANDER WILEY, Wisconsin OLIN D. JOHNSTON, South Carolina WILLIAM LANGER, North Dakota I THOMAS C. HENNINGS, JR., Missouri EVERETT McKINLEY DIRKSEN, Illinois JOHN L. McCLELLAN, ArkansllS ROMAN L. HRUSKA, Nebraska JOSEPH C. O'MAHONEY, Wyoming KENNETH B. KEATING, New York SAM J. ERVIN, JR., North Carolina JOHN A. CARROLL, Colorado THOMAS J. DODD, Connecticut PHILIP A. HART, Michigan SUBCOMMITTEE ON PATENTS, TRADEMARKS, AND COPYRIGHTS JOSEPH C. O'MAHONEY, Wyoming, Chairman OLIN D. JOHNSTON, South Carolina ALEXANDER WILEY, Wisconsin PHILIP A, HART, Michigan ROBERT L. WRIGHT, CAie! Coumel JOHN C. STEDMAN, Alloclate Coumd STEPHEN G. HUBER, C,lile! Cler"k 1 The late Honorable WllUam Langer, whUe a member_of this committee, dIed on Nov. 8, 1959. n , FOREWORD This is the second of a series of committee prints to be published by the Committee on the Judiciary Subcommittee on Patents, Trade­ marks, and Copyrights presenting studies prepared under the super­ vision of the Copyright Office of the Library of Congress with a view to considering a general revision of the copyright law (title 17, United States Code). The present copyright law is essentially the statute enacted in 1909, though that statute was codified in 1947 and has been amended ina number of relatively minor respects. In the half century since 1909 far-reaching changes have occurred in the techniques and methods of reproducing and disseminating the various categories of literary, mus­ ical, dramatic, artistic, and other works that are the subject matter of copyright; new uses of works and new industries for their dissemina­ tion have grown up; and the organization of the groups and indus­ tries that produce or utilize such works has undergone great changes. For some time there has been widespread sentiment that the present copyright law should be reexamined comprehensively with a view to its general revision in the light of present-day conditions. Four studies of a general background nature appeared in the first committee print of this series. The present committee print contains two studies, Nos. 5 and 6, on the substantive problem of the com­ pulsory license for the recording of music, as now provided in 17 U.S.C. § § 1(e) and 101(e). Study No.5, "The Compulsory License Provisions of the U.S. Copyright Law," by Associate Professor Harry G. Henn, of the Cornell Law School, reviews the law and practice on this subject and presents the issues involved. Study No.6, "The Economic Aspects of the Compulsory License," by William M. Blais­ dell, economist of the Copyright Office, presents an analysis of the economic effect of the compulsory license in operation and the prob­ able effect of its elimination. The Copyright Office invited the members of an advisory panel and others to whom it circulated these studies to submit their views on the issues. The views, which are appended to the studies, are those of in­ dividuals affiliated with groups or industries whose private interests may be affected, as well as some independent scholars of copyright problems. It should be clearly understood that in publishing these studies the subcommittee does not signify its acceptance or a,pproval of any state­ ments therein. The views expressed III the studies are entirely those of the authors. JOSEPH C. O'MAHONEY, Ohai1'1TULn, Suboommittee on Patents, Trademarks, and Oopy'l'ights, OO'TTlllTbitt6e on the Judiciary, U.8. Senate. m COPYRIGHT OFFICE NOTE The studies presented herein are part of a series of studies pre­ pared for the Copyright Office of the Library of Congress under a :program for the comprehensive reexamination of the copyright law (title 17 of the U.S. Code) with a view to its general revision. The Copyright Office has supervised the preparation of the studies in directing their general subject matter and scope, and has sought to assure their objectivity and g-eneral accuracy. However, any views expressed in the studies are those of the authors and not of the Copy­ right Office. Each of the studies herein was first submitted in draft form to an advisory panel of specialists appointed by the Librarian of Con­ gress, for their review and comment. The panel members, who are broadly representative of the various industry and scholarly groups concerned with copyright, were also asked to submit their views on the issues presented in the studies. Thereafter each study, as then revised in the light of the panel's comments, was made available to other in­ terested persons who were invited to submit their views on the issues. The views submitted by the panel and others are appended to the studies. These are, of course, the views of the writers alone, some of whom are affiliated with groups or industries whose private interests may be affected, while others are independent scholars of copyright problems. ABE A. GOLDMAN, Ohief of Researoh; Oopyright Office. ARTHUR FISHER, Reqiete» of Oopyright8, Library of Oongre88. L. QUINCY MUMFORD, Librarian of Oonqrees. v ).' OONTENTS Study No. Page 5. The Compulsory License Provisions of the U.S. Copyright Law_______ IX Comments and Views Submitted to the Copyright Office__ ___ __ ___ 59 6. The Economic Aspects of the Compulsory License.. ._ ____________ 87 Comments and Views Submitted to the Copyright Office . 115 va STUDY NO.6 THE COMPULSORY LICENSE PROVISIONS OF THE U.S. COPYRIGHT LAW By PROF. HARRY G. HENN July 1956 IX .. CONTENTS Introduction _ Page 1 1. Analysis of pertinent provisions of present copyright law _ 2 A. Legislative history of present compulsory license provisions__ 2 B. The present compulsory license provisions _ 12 C. Judicial and administrative construction of present provisions., 15 II. Le§t~t;!:~n~~si~6!LO!_~~~~~~~~~ _~~~~~~~_ :~~~~~i~~~ i~_ :~~_~~i:~~ A. Proposed bills _ _ 21 B. Surnrnary _ 21 35 III. Compulsory license provisions in the laws of other countries and in international conventions _ A. National laws _ 36 36 B. International conventions _ 41 IV. PresentStates music publishing-recording industry practices in the United_ 44 A. Public dornain _ 46 B. Common-law copyright _ 46 C. Statutory copyright _ 49 V. Problems in evaluating compulsory license provisions of present copyright law _ 52 A. Compulsory license principle _ 53 B. Reproduction permitted under compulsory license _ 54 C. Statutory royalty rate _ 54 D. Procedural implementation _ 56 E. Extensionworks of compulsory license principles to nonmusical_ 56 F. Statutory language _ 57 G. Effective date of amendments _ 57 VI. Recapitulation of major issues _ 57 XI THE COMPULSORY LICENSE PROVISIONS OF THE U.S. COPYRIGHT LAW The U.S. Copyright Act of 19091 recognized for the first time • recordin~ and mechanical reproduction rights 2 as part of the bundle of exclusive rights secured 'by statutory 8 copyright in certain classes of works, Iimiting such mechanical reproduction rights in musical compositions by compulsory license provisions. Shortly before the passage of the 1909act, the U.S. Supreme Court. in construing the then-existing copyright statute," in the oft-cited case of White-Smith Music Publishing 00. v. Apollo 00.,6 had held that the making and sale of a pianola roll." of a copyrighted musical com­ position did not constitute copying (or publication or, inferentially. vending), and hence was no mfringement, of the copyright in such 1 Act of March 4, 1909 (311 Stat. 1075), ell'ectlve July I, 1909, 17 United States Code J et seq. (1952). • Quaere, whether "recording rights" and "mechanical reproduction rights" are synony· mous. If the former are broader than the latter the compulsory Ilcense provision might apply only to the latter. The terminology of the Copyright Act is far from consistent. See pp. 13-14, 54, Infra. • Recording has been held vlolaUve of common-law rights. George v. Victor TaJld",g Machine 00., 38 U.S.P.Q. 222 (D.N.J. 1038). rev'd on other grounds, 105 F. 2d 607 13d Clr. 1939). cert. denied, 308 U.S. 611, Sup. Ct. 176, 84 L. Ed. 1>11 (1939). This has long been the assumption of the music publishing and recording Industry. See pp. 46-48, Infra. Common-law rights are perpetual untlI publication (see note 71 infra), and are not subject to the compulsory Ilcense provision of the U.S. Copyright Act. • Dramatic works (sec. l(d» and musical compositions (sec. 1 (e»: Prior to the act ot July 17,191>2 (66 Stat. 71>2), effective January 1,1953,17 U.S.C. l(c) (Supp. 19(5) no recording rights attached to nondramatte literary works. Ooroora", v. Montgomery Ward <f 00.,121 F. 2d 576 (lith Ctr. 1941), cert. denIed, 314 U.S. 687,62 SuP. Ct. 300, 86 L. Ed. 550 (1941) (settinl\' to music and recording poem held not to infringe statutory copyright In poem). See H. Rept. No. 1160. 82d Cong., 2d sess, (1952) ; Cane, "Belated Justice for Authors," 36 Stat. Rev. 21 (Aug. 22,19(2) ; Schulman, "Recording Base Widens." 1 Ameri­ can Writer 13-15 (October 10(2). Only mechanical reproduction rights in musical com­ positions are subject to compulsory Iteenstng. ,(See p. 56, lufra.) • Act of Mar.
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