Submitted by Susan Chertkof on behalf of American Association of Independent (“A2IM”) and Recording Industry Association of America, Inc. (“RIAA”) Before the UNITED STATES COPYRIGHT OFFICE Washington, D.C.

In the Matter of:

Noncommercial Use of Pre-1972 Sound Docket No. 2018-8 Recordings That Are Not Being Commercially Exploited

COMMENTS OF THE AMERICAN ASSOCIATION OF INDEPENDENT MUSIC AND RECORDING INDUSTRY ASSOCIATION OF AMERICA, INC.

The American Association of Independent Music (“A2IM”) and the Recording Industry Association of America, Inc. (“RIAA”) (together the “Commenters”) are pleased to provide these comments in response to the Notice of Inquiry (“NOI”) published by the Copyright Office on October 16, 2018. See 83 Fed. Reg. 52,176 (October 16, 2018).

A2IM is a nonprofit trade organization that supports and promotes the creative and financial vitality of a broad coalition of more than 600 independently owned U.S. music labels. RIAA is a nonprofit trade organization that supports and promotes the creative and financial vitality of the major record companies in the United States. The members of RIAA and A2IM collectively create, manufacture and/or distribute nearly all of the sound recordings commercially produced and distributed in the United States. That includes sound recordings fixed before February 15, 1972 (“pre-72 recordings”). RIAA and A2IM members collectively are the rights owners of nearly all pre-72 recordings commercialized in the United States. Their members depend on copyrights and their rights in pre-72 recordings to protect the recorded music they have invested in and created in collaboration with musicians, songwriters and other artists.

The Commenters appreciate the opportunity to share our views on the issues raised by the NOI. In these Comments, we respond to the issues identified by the Copyright Office in the NOI along with several other issues of concern to the Commenters.

I. Background Concerning Section 1401(c)

As the Office considers potential implementing regulations for Section 1401(c), the Commenters believe it is important for the Office to view Section 1401(c) in its proper context – as, more often than not, a tool of last resort, when it is not possible to seek permission via other traditional means to use a pre-72 sound recording that is not being commercially exploited (each a “covered pre-72 recording”) for a noncommercial use. Consider, for example, that many noncommercial projects will likely involve the need to obtain permissions (or assurances that no permission is required) for other third-party works as well, whether it is the underlying musical work or comedy sketch for the pre-72 sound recording at issue, other pre-72 or post-71 sound recordings, post-71 derivative sound recordings,1 or ancillary material such as cover art or liner notes, or permissions from the sound recording artist(s) or their heirs, depending upon if or how their name or likeness is used. Given the need for additional permissions and the need to complete the permissions process within a limited time frame, it will often be more efficient for the user to seek voluntary licenses from rights owners in connection with a non-commercial project, including the permission needed to use a covered pre-72 sound recording (once its owner is identified), than to utilize the Section 1401(c) process.

Another reason that use of Section 1401(c) should be viewed as one of last resort is because it has numerous disadvantages: (1) as noted above, it does not permit users to obtain the full bundle of rights they will need even for most noncommercial projects (i.e., it does not extend to the underlying musical (or other) work nor to ancillary materials such as the cover art), (2) it does not allow for any negotiation between the user and rights owner, (3) it potentially requires months to determine whether permission is granted or denied (i.e., because the rights owner has 90 days to determine whether to opt out), (4) it leaves the user with some risk of having relied on Section 1401(c) inappropriately (such as where the use does not really qualify as noncommercial, or a reasonable, good faith search should have revealed commercial exploitation) and (5) it is territorially limited to the United States (and thus cannot meet the needs of users who wish to procure global rights).

For all of these reasons, where the current rights owner is known or reasonably capable of discovery (which includes most covered pre-72 recordings that were originally released by a U.S. , large or small),2 Section 1401(c) is unlikely to offer the best approach to clearing rights for covered pre-72 recordings. Congress understood this, too. It viewed Section 1401(c) as a process “primarily to enable use of older recordings where it may not be clear to a user how to contact the rights owner to ask for permission.” 3

Given the above, we anticipate that – apart from instances where the rights owner either cannot be identified or cannot be located even after an exhaustive search of the type outlined in response to questions A1-A8 below – the Section 1401(c) process will be used either as a last resort, or by those with little to no experience clearing sound recording rights. As such, the Office should

1 The user should be attentive to whether the proposed use involves a “pure” pre-72 recording or may also involve a post-1971 derivative work of a pre-72 recording. Users often may have the easiest access to pre-72 recordings that were re-released on CD or for digital download. If such a re-release involved new original authorship, such as remixing pre-72 recorded sounds, rights to the re-released version cannot be cleared through Section 1401(c). 2 For example, it is well-known that is a division of Sony Music Entertainment, is the current successor to and parent of Decca Records, and Warner Music Group is the parent of Parlophone Records Limited (formerly EMI Records). See Columbia Records, Wikipedia, https://en.wikipedia.org/wiki/Columbia_Records, Decca Records, Wikipedia, https://en.wikipedia.org/wiki/Decca_Records, Parlophone, Wikipedia, https://en.wikipedia.org/wiki/Parlophone. 3 Chairmen and Ranking Members of the House and Senate Judiciary Committees, Background and Section-by- Section Analysis of H.R. 1551, the Music Modernization Act, 115th Cong. at 25 (Oct. 19, 2018) [hereinafter “Conference Report”], available at https://www.copyright.gov/legislation/mma_conference_report.pdf. 2 approach these regulations with the goal of creating a Section 1401(c) process that encourages users to conduct sufficient research to have a reasonable chance of identifying the sound recording owner, coupled with a requirement that the user must provide sufficient identifying information about the sound recording at issue and sufficient detail about the use requested to ensure that the rights owner has the information needed to give the proposed use due consideration. The comments below are intended to further these goals.

II. Questions Raised in the NOI

A. Good Faith, Reasonable Search

Introduction. Section 1401(c) is available only for pre-72 recordings that are not being commercially exploited by or under the authority of their rights owners. 17 U.S.C. § 1401(c)(1). Accordingly, it is critical that a user search for commercial exploitation in a way that, while being reasonable, will, with a high degree of certainty, find commercial exploitation if it is occurring.4 The NOI properly recognizes that such a search should not be limited to a monoculture of services offering substantially overlapping repertoires of recordings, but should instead reach an array of different distribution channels where it is reasonable to expect that commercial exploitation may be found. The Commenters agree wholeheartedly.

A search strategy under Section 1401(c) should be designed to provide reasonable assurance that the recording that is the subject of the search is not being commercially exploited in any distribution channel that can reasonably be searched by those resident in the U.S., and to do so in as efficient a manner as possible. Accordingly, searching that is relatively easy and likely to find commercial exploitation should be prioritized over other searching, so if Section 1401(c) is unavailable due to commercial exploitation, the user can discern that fact with a reasonable investment of time and effort. Within each distribution channel, users should be required to do a reasonable amount of searching. However, the Office should not require an excessive amount of redundant searching among services of one type, when that effort might more usefully be applied to searching for commercial exploitation in other distribution channels.

Rather than requiring users to exhaustively search a broad list of services that offer a comprehensive catalog of recordings (“comprehensive services”), we propose dividing the various sources that users should search into different categories and then requiring all users to

4 Although the statute does not define the phrase “commercially exploited,” we view the phrase to include, without limitation, any activity, whether occurring within or outside of the U.S., that is intended to produce direct or indirect economic or other gain by making a recording accessible to users in the U.S. “including [through] user-generated services and other services available in the market at the time of the search.” Conference Report at 25. It also includes, without limitation, making the recording available for sale or distribution; for performance on a streaming or similar service (whether on-demand, traditional webcasting or otherwise); for use in an online audiovisual work or in a movie, television show or advertisement; taking steps to make the recording available for the above uses, such as assigning an ISRC number and listing it in relevant databases to enable the rights owner to receive any royalties that accrue; and any activity that is substitutional to the above or any other activity designed to commercially exploit the sound recording. 3 search in all categories (until a match is found).5 As soon as a user finds a match, she can terminate her search, as that recording is, by definition, being “commercially exploited by or under the authority of the rights owner” and is thus not eligible for the noncommercial use safe harbor.

When conducting searches in each of the proposed categories, users should be expected to undertake a search that is designed to find the recording if it is currently being commercially exploited. This includes searching on all known attributes of the recording in question (e.g., artist, title, label, underlying musical work, ISRC number) and, if no matches are returned, reasonable variations of the same (e.g., search with and without a leading “the,” search for the professional name of the featured artist as well as the band name such as Diana Ross and the Supremes, search for obvious variations on key words in the title such as “Dock of the Bay,” “Sittin’ on the Dock of the Bay” or “Sitting on the Dock of the Bay”).

It may also make sense for users to enlist the assistance of music clearance professionals in appropriate circumstances. This is consistent with the reference to “external expert assistance” in Section (A)(ii)(I)(cc) of the 2008 Shawn Bentley Orphan Works Bill (which is referenced in the NOI) and Section (b)(2)(A)(v) of that bill, which states that “[a] qualifying search . . . may require use of resources for which a charge or subscription is imposed to the extent reasonable under the circumstances.” S. 2913, 110th Cong. (as passed by Senate, September 26, 2008).

Below is a proposed list of search categories, in recommended search order (which prioritizes searches most likely to find commercial exploitation with a minimal investment of effort, and hence generally proceeds from broad to narrow). In constructing the list of categories, we sought to minimize redundancy by identifying categories with a minimal degree of overlap with respect to the sound recordings likely to be discovered in a search of each category.

• Step 1. Search the Office’s Database of Pre-1972 Schedules. This step is statutorily mandated. See Section 1401(c)(1)(A)(i).

5 This categorical approach is consistent with the approach taken in the 2008 Shawn Bentley Orphan Works Bill, S. 2913, 110th Cong. §514(b)(2)(A)(ii) (as passed by Senate, September 26, 2008), which described a “diligent effort” as follows:

“(ii) DILIGENT EFFORT.—For purposes of clause (i), a diligent effort— (I) requires, at a minimum— (aa) a search of the records of the Copyright Office that are available to the public through the Internet and relevant to identifying and locating copyright owners, provided there is sufficient identifying information on which to construct a search; (bb) a search of reasonably available sources of copyright authorship and ownership information and, where appropriate, licensor information; (cc) use of appropriate technology tools, printed publications, and where reasonable, internal or external expert assistance; and (dd) use of appropriate databases, including databases that are available to the public through the Internet; and (II) shall include any actions that are reasonable and appropriate under the facts relevant to the search, including actions based on facts known at the start of the search and facts uncovered during the search, and including a review, as appropriate, of Copyright Office records not available to the public through the Internet that are reasonably likely to be useful in identifying and locating the copyright owner.”

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• Step 2. Search at least 1 major search engine (e.g., Google, Yahoo!, Bing) for any indication of commercial exploitation, which might, for example, include products for sale, niche streaming services that offer the recording, a discography reflecting a recent release or news about the recording. • Step 3. Search for the recording on at least 2 comprehensive streaming services and at least 1 comprehensive download service (while they continue to exist) that receive digital feeds from the major labels, large indie labels and significant distributors (e.g., , Apple Music, Tidal, Amazon Music, iTunes). Although not a service itself, users may also wish to search Dogstar Radio, http://dogstarradio.com/search_playlist.php, because it offers searchable from Sirius XM, including relevant channels such as ‘50s on 5, ‘60s on 6, Elvis Radio, Siriusly Sinatra and On Broadway.6 For a fuller list of streaming services, see the response to Question A.2 below. • Step 4. Search the SoundExchange ISRC Search database, available at https://isrc.soundexchange.com/#!/search, which lists recordings for which rights owners or their authorized representatives have submitted metadata to SoundExchange for royalty collection, which is a form of commercial exploitation. • Step 5. Search for the recording on at least 1 major service featuring user-uploaded content (e.g., YouTube). • Step 6. Search all of the following comprehensive databases of sound recordings and/or the underlying musical works: o The Music Licensing Collective (“MLC”) database, once it is launched;7 o The online databases of all U.S. PROs (including any new ones that arise), to the extent that they offer publicly available databases (e.g., ASCAP’s ACE database, BMI’s Repertoire database); o Comprehensive databases offered by other music industry groups or private companies such as HFA (e.g., Songfile, Rumblefish), MRI (e.g., Songdex, Cuetrak) and Crunch Digital;8 o IMDb, for recordings used in old movies and television shows that are still being commercially exploited, which can be found using an advanced search of soundtracks; and o The SXWorks NOI Tools, available at https://noi.sx-works.com/login (NOIs were filed because someone was planning to commercialize the listed musical works).

6 Because Sirius XM is not an on-demand service like the others, we do not recommend including it as one of the 2 streaming services users are required to search. We note that Sirius XM now owns Pandora. When we refer to Sirius XM here, we are referring to the service branded as Sirius XM. 7 We recognize that the MLC database will be focused primarily on data concerning musical works, though it will also include some basic information about the sound recordings embodying those musical works. We recommend here and elsewhere that users interested in a particular sound recording conduct a search for the underlying musical work search for two separate, but related, reasons. First, searching the musical work may help the user identify the current or last-known sound recording owner. Second, for musical works that have only been recorded one time, the fact that the musical work is being commercially exploited is a strong indication that the sound recording is also being commercially exploited. 8 Some of these may charge a fee for access to their database or require users to work with their staff to conduct a search. 5

• Step 7. Search at least 2 music distribution services that feature music from smaller, independent labels (e.g., CDBaby, Tunecore). It is our understanding that does not make its catalog publicly available. • Step 8. Search all consequential services in any niche relevant to the sound recording at issue (e.g., jazz, classical, big band, blues, foreign language repertoire and repertoire of foreign origin). o If the recording at issue is a foreign language recording or was first released outside the U.S., is known to be or have been popular in a market outside the U.S. or to have been primarily exploited in a market outside the U.S., the search should include leading digital services in relevant foreign countries including the country of origin or countries where the work is most popular, to the extent those services are accessible from the U.S. For a list of licensed download, subscription and ad- supported services throughout the world, see https://pro-music.org/. o In the case of U.S. repertoire believed not to have been distributed by a major label, the search should include services like Soundcloud and , which feature independent artists and smaller labels, along with niche services, such as: HD Tracks, Classical Archives, Idagio, Primephonic, Presto, Acoustic Sounds and Naxos. • Step 9. Search all relevant major sellers of physical product, including but not limited to, Amazon, Smithsonian Folkways Recordings, ArkivMusic and ArkivJazz.

To protect rights owners from the need to respond to frivolous or unwarranted Notices of Noncommercial Use (each an “NNU”, together “NNUs”), the Office should refuse to accept an NNU if the user fails to include proof that all of the categories listed above were searched and that no matches were found along with a certified step-by-step account of all sources searched and the precise search terms used, as more fully described in response to Question B.3 below.

1. What would constitute a reasonable search of the Office’s database of Pre-1972 Schedules, which will index information including the name of the rights owner, title, and featured artist for each sound recording filed on a schedule?

In principle, a reasonable search is one that will, with a high degree of certainty, return a match if a match exists. To ensure a frequent successful search, at least four things are necessary: (a) the user must know some basic identifying information (e.g., title, artist) about the recording at issue; (b) the database must be searchable on all fields (i.e., both the mandatory and the optional fields);9 (c) the database must, in addition to offering exact text matching, employ fuzzy matching and/or wildcard searching to increase the likelihood of picking up matches even when names or titles are misspelled or misstated or when words are missing; and (d) the user must conduct a careful search that involves searching in all fields for which the requisite search information is available to the user (i.e., if the user knows the ISRC number, she would be required to search the ISRC field). To the extent that the Database of Pre-1972 Schedules does

9 To see a list of the optional fields proposed by A2IM and RIAA (and SoundExchange, who has filed separate comments in response to this NOI) in their November 16, 2018 comments on the Interim Rule regarding the Filing of Schedules by Rights Owners and Contact Information by Transmitting Entities Relating to Pre-1972 Sound Recordings, see https://www.regulations.gov/document?D=COLC-2018-0007-0002 at 7. 6 not – at least initially – offer robust search capabilities, it falls to the user to employ a search strategy from other sources that is thorough enough to return a match if one exists. For example, as noted above, the user should be required to search on all obvious alternatives to the terms they believe they know (e.g., search with and without a leading “the,” search for the professional name of the featured artist as well as the band name such as Diana Ross and the Supremes, search for obvious variations on key words in the title such as “Dock of the Bay,” “Sittin’ on the Dock of the Bay” or “Sitting on the Dock of the Bay”).

For additional guidance on how to construct an effective search strategy, we suggest that the Office seek input from the members of the Office staff who are tasked with conducting registration and recordation searches. We understand that “the Copyright Office staff will search the records of registrations and other recorded documents concerning ownership of copyrights and will provide a written report.” U.S. Copyright Office, Circular 22: How to Investigate the Copyright Status of a Work at 2, available at https://www.copyright.gov/circs/circ22.pdf. The task of searching for recordings on Pre-1972 Schedules does not seem fundamentally different from the task of finding a copyright registration or recorded document. Techniques used in such searches by professional searchers accustomed to working with variations in Copyright Office records are likely to be useful for other users seeking to find recordings on Pre-1972 Schedules.

2. Please suggest specific “services offering a comprehensive set of sound recordings for sale or streaming” that users should be asked to reasonably search before qualifying for the safe harbor.

As described more fully in the Introduction to Section II.A of these comments, undertaking a search of “services offering a comprehensive set of sound recordings for sale or streaming” is only one of the reasonable steps users should be required to take if they wish to make a noncommercial use of a covered pre-72 sound recording. At present, there are a number of “services offering a comprehensive set of sound recordings for sale or streaming” available in the marketplace. Because all of these services provide access to roughly the same catalog of sound recordings, we do not think that users should be required to search all such services, as that might simply result in duplicative searches. Given the above, we suggest requiring users to search at least 2 of the following comprehensive services: Amazon (including Amazon Music, Amazon Unlimited, Amazon Prime), Apple Music, Deezer, Google Play, iHeart, iTunes, Pandora, Slacker, SoundCloud, Spotify and TIDAL.10 Services that offer recordings for sale in physical format are listed in response to Question A.5 below.

Given the pace of change in the digital music marketplace, however, we recommend that the regulations cite the statutory language and then include a list of examples, like those suggested above, which list is updated periodically. To ensure that the regulations keep abreast of changes in the marketplace, the Office should plan periodically to publish an NOI inquiring about changes in the digital music landscape that need to be reflected in the good faith, reasonable search regulations. Publication of such an NOI also may be warranted following a significant

10 Users may also wish to search Dogstar Radio at http://www.dogstarradio.com/search_playlist.php, a third-party service that provides access to all Sirius XM playlists. However, as noted earlier, Sirius XM is not an on-demand service like the others listed above and is therefore likely to be less comprehensive. Therefore, we do not recommend that it be included as one of the 2 required searches. 7 change in the digital music landscape (e.g., a major service exits the business, a new service significantly rises in prominence). It does not serve the statutory purpose well if we list services today and assume they will remain at the top of the market indefinitely. The list above simply identifies a group of today’s leading digital music services but should be understood as only as a list of examples, not a limitation on the obligations of the user that will continue until the Office next revisits the regulations despite changes in the marketplace. In order to remain on the Office’s list of examples, services should be required to remain “significant” in the marketplace and continue to offer access to a comprehensive catalog of recordings. In amending the above list in the future, we recommend that the Office give great weight to the list of services that Nielsen’s BDS radio service looks to in developing its proprietary analytics and tools. For a list of the services that Nielsen currently includes in its BDSradio service, see https://www.bdsradio.com/pd/docs/WhyBDSradio.pdf. If Nielsen ceases to exist or stops offering its BDS radio service, the Office will need to investigate some other appropriate index from which to use the list of example services and/or solicit input from rights owners about an appropriate substitute.

We recognize that some of the above services charge a subscription fee. In many cases, the same service offers a free tier with less functionality or a limited-time free trial, although the lower tier of a service may not always offer access to the full catalog of recordings that are available through the premium tier. Even if users are, on occasion, required to pay for one or more subscriptions in order to satisfy their good faith, reasonable search obligations, we believe any such fees are fair and reasonable in return for users’ ability to obtain, in appropriate instances, what is effectively a royalty-free license to use our members’ sound recordings. This same concept was incorporated into the 2008 Shawn Bentley Orphan Works Bill referenced in the NOI, S. 2913,110th Cong. (as passed by Senate, September 26, 2008) Section (b)(2)(A)(v) which made clear that a “qualifying search under . . . [the Act] may require use of resources for which a charge or subscription is imposed . . ..”

3. Which criteria should be used to identify music streaming services that should be searched, now and in the future?

We provided our thoughts on a broad, categorical search strategy in the Introduction to Section II.A of these comments. We provided a list of “services offering a comprehensive set of sound recordings for sale or streaming” and our thoughts on how to choose those services now and in the future in answer to Question A.2 above.

The NOI also refers to Billboard and the services reflected in its streaming-exclusive charts. The Billboard charts provide important metrics that are relied on for various purposes within our industry. However, those charts reflect the top streaming recordings of today. As such, except in very rare cases (typically following a popular sync use of an older recording) the Billboard charts will have little to say about which older recordings are being commercially exploited.

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4. Is it reasonable to expect a user’s search to encompass music distribution services, such as CD Baby, TuneCore, or The Orchard?

Yes, as discussed in the Introduction to Section II.A above. We do think this is reasonable and likely to yield results that are non-duplicative with searches of the various comprehensive services listed in response to Question A.2. We note that The Orchard does not currently make its catalog available for searching by the public.

5. Are there other sources to which the Office should look that may demonstrate commercialization of physical copies of recordings, e.g., vinyl records or compact discs?

We provided our thoughts on a broad, categorical search strategy in the Introduction to Section II.A of these comments. Amazon is the number one online retailer of physical copies of recordings. All users should be required to search there or any similar service that emerges to compete with or replace Amazon. Smithsonian Folkways Recordings, ArkivMusic and ArkivJazz also offer large catalogs of physical releases, many of which were first released prior to 1972. To the extent the sound recording is of foreign origin or in a foreign language, users should also be required to search Amazon’s foreign counterparts and other easily searchable places where vinyl records or compact discs may be sold overseas as well, to the extent those services are accessible from the U.S.

6. Are there other specialized services or salesfronts regarding particular genres or eras within the category of Pre-1972 Sound Recordings that should be considered by the Office?

See Introduction to Section II.A above. Specialized services or salesfronts include the following: HD Tracks, Classical Archives, Idagio, Primephonic, Presto, Naxos, Acoustic Sounds, Smithsonian Folkways Recordings, ArkivMusic and ArkivJazz. Others should be determined by each user on a case-by-case basis, perhaps in consultation with an experienced music clearance professional.

7. How many sources should a user be required to search before qualifying for the safe harbor? In responding, please consider that the Office must promulgate a “reasonable” list of steps, but in a way that does not overlook commercialization of Pre-1972 sound recordings.

Every user should be required to search a sufficient number of sources to determine whether the recording at issue is being commercially exploited. For repertoire of foreign origin or in a foreign language, this would include searching relevant foreign services and databases that are accessible from the U.S. The exact number will vary from case to case depending on the exact sound recording at issue, the genre, the date of original publication or release, the original label and other factors. At a minimum, a user should be required to search the specified number of services in each category listed in the Introduction to Section II.A above, but such list should be viewed as a floor, not a ceiling.

8. Please describe specific steps that should constitute a reasonable search for a recording on an identified service. Should the steps be service-specific or would a single list of steps be

9 adequate for any identified source? Is the description of a qualifying search described by the 2008 bill referenced above useful in defining whether a user has conducted a reasonable search to determine whether a work is being commercially exploited?

Users should, at a minimum, be required to search the minimum number of services listed in each category specified in the list in the introduction to Section II.A above. When conducting searches in each of the listed categories, users should be expected to undertake a search that is designed to find the recording if it is currently being commercially exploited. This includes searching on all known attributes of the recording in question (e.g., artist, title, label, underlying musical work, ISRC number) and, if no matches are returned, reasonable variations of the same (e.g., search with and without a leading “the,” search individual band members as well as the band, search for typical grammatical and spelling variations of the words in the title). As noted in response to Question B.3 below, users should also be required to document and certify the search terms used and provide screen shots evidencing the searches they performed.

The question also asks whether the steps for a “diligent effort” set forth in Section (b)(2)(A)(ii)(I) and (II) of the 2008 Shawn Bentley Orphan Works Bill are useful in defining whether a user has conducted a reasonable search. As noted earlier, we agree with the categorical approach adopted in that bill but find the steps outlined there to be too generic for the search contemplated here. Under that bill, the generic steps described in Section (b)(2)(A)(ii)(I) and (II) were intended to be supplemented by Recommended Practices to be developed by the Copyright Office for each category of copyrighted work and “additional appropriate best practices of authors, copyright owners, and users to the extent such best practices incorporate the expertise of persons with specialized knowledge with respect to the type of work for which the search is being conducted.” See S. 2913, 110th Cong. §514(b)(2)(A)(iii)(as passed by Senate, September 26, 2008). Given the narrow focus of Section 1401(c) on sound recordings, the instant regulations should provide the same degree of specificity with respect to sound recordings as the Recommended Practices and best practices described in the 2008 Bill were intended to do. In addition to the generic list of search steps mandated under Section (A)(ii)(I) of the 2008 Bill, Section (A)(ii)(II) required a diligent search to “include any actions that are reasonable and appropriate under the facts relevant to the search, including actions based on facts known at the start of the search and facts uncovered during the search.”

B. Filing of Notices of Pre-1972 Noncommercial Use and Pre-1972 Opt-Out Notices

1. Should the Office provide guidelines as to what constitutes a “noncommercial” use, and if so, what? In answering, consider that “merely recovering costs of production and distribution of a sound recording resulting from a use otherwise permitted under this subsection does not itself necessarily constitute a commercial use of the sound recording,” and “the fact that a person engaging in the use of a sound recording also engages in commercial activities does not itself necessarily render the use commercial.” For example, should the online use of a work where the user receives website advertising revenue be considered “commercial”? Should a prospective user be asked to disclose whether they are an individual, or whether they will operate as a commercial or noncommercial entity?

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The Commenters believe that it would be very helpful for the Office to provide users guidelines to help them distinguish noncommercial uses from other uses. To that end, our recommended guidelines appear on pages 14-15 of these comments. To allow rights owners to properly evaluate a proposed use, the user should be required to disclose whether the use will be made by a natural or legal person. It also should be understood that neither the Office’s indexing of an NNU nor a rights owner’s providing a Pre-1972 Opt-Out Notice is indicative of whether a proposed use qualifies as a noncommercial use.

Proposed Guidelines While it might be difficult to articulate a comprehensive and precise definition of what is, or is not, a noncommercial use, it is both possible and desirable for the Office to provide guidelines to help avoid or resolve disputes over what constitutes noncommercial use. To put the Commenters’ proposed guidelines in context, we begin by reviewing relevant case law along with a study that surveyed creators and online users about the commercial/noncommercial use distinction.

Relevant Case Law Congress has indicated that “the concept of noncommercial use should be understood in the same way as under other provisions of title 17, such as section 107, and includes uses such as teaching, scholarship and research.” Conference Report at 25.11 Case law under Section 107 provides a rich source of guidance as to what is commercial or noncommercial.12 Among other things, that authority suggests that guidelines should take into account both the nature of the user and the nature of the use.

As to the nature of the user, there are no bright lines under Section 107, and Section 1401(c)(2)(B) confirms that Congress expected the same to be true under Section 1401(c). However, that does not mean that the nature of the user is “irrelevant.” American Geophysical Union v. Texaco Inc., 60 F.3d 913, 921 (2d Cir. 1994). As the Second Circuit explained, “it is overly simplistic to suggest that the ‘purpose and character of the use’ can be fully discerned without considering the nature and objectives of the user.” Id. at 922. Activities involving for- profit entities will likely be commercial, while activities by non-profit organizations (i.e.,

11 Numerous provisions of the Copyright Act refer to commercial or noncommercial activity. In some cases, those concepts are used in specialized ways as part of defined terms. E.g., 17 U.S.C. § 114(f)(4)(E)(i) (noncommercial webcaster); id. § 110(8), 118(f), 122(j)(5) (noncommercial educational broadcast station). Such specialized uses do not seem relevant to Section 1401(c). Of the others, by far the largest body of relevant case law has arisen under Section 107. 12 The case law also highlights that eligibility for Section 1401(c) is both broader and narrower than fair use, because a fair use determination is based on a balancing of factors, of which commerciality is only one (and often not a very important one). Section 1401(c) is broader in the sense that it applies to all noncommercial uses, including ones that might not be found to be fair. For example, under the Guidelines for Educational Uses of Music that accompanied the Copyright Act of 1976, it was recognized that fair use would permit “[a] single copy of a sound recording . . . [to] be made from sound recordings owned by an educational institution or an individual teacher for the purpose of constructing aural exercises or examinations.” H.R. Rep. No. 94-1476 at 71 (1976). That is presumably a noncommercial use, but if a larger number of copies was made, it might not be a fair use. That kind of activity would seem to be a candidate for Section 1401(c). Section 1401(c) is narrower than fair use in the sense that many commercial uses are fair uses. See, e.g., Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 584 (1994) (“nearly all of the illustrative uses listed in the preamble paragraph of § 107 . . . ‘are generally conducted for profit in this country.’”). Such commercial use is not eligible for Section 1401(c). 11

501(c)(3) tax exempt organizations) may or may not be noncommercial, but in neither case is the nature of the entity dispositive.

As to the nature of the use, case law indicates that commercial uses tend to be ones that result in “private economic rewards.” Id. Any economic gain suggests a commercial use, and that conclusion is magnified when the user is a for-profit company.13 An economic gain can be disqualifying even if it is not as direct as charging a fee. A & M Records, Inc. v. , Inc., 239 F.3d 1004, 1015 (9th Cir. 2001) (“Direct economic benefit is not required to demonstrate a commercial use.”). For example, any “repeated and exploitative copying of copyrighted works . . . may constitute a commercial use.” Id. Similarly, advertising uses will generally be considered commercial uses.14 That is true even if the advertising is by a non-profit organization.15 In fact, “[t]he crux of the profit/nonprofit distinction is not whether the sole motive of the use is monetary gain but whether the user stands to profit from exploitation of the copyrighted material without paying the customary price.” Harper & Row, Pubs., Inc. v. Nation Enters., 471 U.S. 539, 562 (1985).

Putting these pieces together, in the case of activities of a for-profit entity, the for-profit nature of the entity will almost always mean that the use is commercial, unless “‘the link between [the defendant]’s commercial gain and its copying is . . . attenuated’ such that it would be misleading to characterize the use as ‘commercial exploitation.’” Swatch Group Management Services v. Bloomberg LP, 756 F.3d 73, 83 (2d Cir. 2014) (quoting Am. Geophysical Union, 60 F.3d at 922) (alterations in original). The use need not be material to the for-profit entity for it to be commercial. Where a use did not “more than trivially affect[] the value” of the service provided by the user, the Second Circuit nonetheless recognized “the commercial nature” of the use. Id. Use by a for-profit company for product development purposes has been found to allow the company to “gain commercially” and have a “commercial aspect,” even where the use had a “legitimate, essentially non-exploitative purpose” and “public benefit.” Sega Enterprises Ltd. v. Accolade, Inc., 977 F.2d 1510, 1523 (9th Cir. 1992).

As to non-profit organizations, a use is commercial if it confers a benefit on the organization or is exploitative copying of the kind that usually results in compensation to the rights owner. See,

13 Section 1401(c)(2)(A) provides that in one narrow circumstance, mere recovery of production and distribution costs does not necessarily signal a private economic reward. That circumstance is where a use putatively undertaken pursuant to Section 1401(c) results in the creation of another sound recording. See 17 U.S.C. § 1401(c)(2)(A) (“merely recovering costs of production and distribution of a sound recording resulting from a use otherwise permitted under this subsection”). Presumably this provision is referring to recovery of costs of production and distribution of something like a remix created under Section 1401(c). Consistent with the general principle described above, the implication seems to be that in other circumstances cost recovery suggests a commercial use. 14 See, e.g., Campbell, 510 U.S. at 585 (“use, for example, of a copyrighted work to advertise a product, even in a parody, will be entitled to less indulgence under the first factor of the fair use enquiry than the sale of a parody for its own sake”); Warner Bros. v. American Broadcasting Companies, 720 F.2d 231, 242 (2d Cir. 1983) (“No matter how well known a copyrighted phrase becomes, its author is entitled to guard against its appropriation to promote the sale of commercial products.”). 15 See, e.g., Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1152 (9th Cir. 1986) (use in fundraisers for religious organizations is commercial); Reyes v. Wyeth Pharmaceuticals, Inc., 603 F. Supp. 2d 289, 296-97 (D.P.R. 2009) (public service announcement placed by non-profit organization but including logo of pharmaceutical company was commercial); World Wrestling Federation Entertainment v. Bozell, 142 F. Supp. 2d 514, 532 (S.D.N.Y. 2001) (use in fundraising video “sought financial gains and an increase in notoriety”). 12 e.g., Wall Data Inc. v. Los Angeles Cty. Sheriff’s Dep’t, 447 F.3d 769, 779 (9th Cir. 2006) (copying software within police department to avoid expense of buying additional licenses is commercial use); Worldwide Church of God v. Philadelphia Church of God, 227 F.3d 1110, 1118 (9th Cir. 2000) (church that copied religious text and distributed it to its members “unquestionably profit[ed]” from the unauthorized use); Lish v. Harper’s Magazine Foundation, 807 F. Supp. 1090, 1101 (S.D.N.Y. 1992) (non-profit organization’s publishing magazine for sale is commercial use).

In the case of individuals, courts do not seem to have indicated that the nature of the user matters one way or the other. Instead, the nature of the use is dispositive. On the one hand, use of lawfully-acquired works for an individual’s personal enjoyment clearly seems to be noncommercial. Recording Industry v. Diamond Multimedia Systems, 180 F.3d 1072, 1079 (9th Cir. 1999) (copying legitimately-acquired MP3 files from user’s computer hard drive to portable media player “is paradigmatic noncommercial personal use” as contemplated in Section 1008).

On the other hand, individuals engaged in business activity are obviously making a commercial use, and sometimes profit handsomely from such use. E.g., Blanch v. Koons, 467 F.3d 244, 248 (2d Cir. 2006) (artist sold paintings for $2 million).16 It is not necessary for money to change hands for an individual to be considered engaged in a commercial use. Weissmann v. Freeman, 868 F.2d 1313, 1324 (2d Cir. 1989) (“the profit/non-profit distinction is context specific, not dollar dominated”). An individual’s “get[ting] for free something they would ordinarily have to buy” is a commercial use, as is an individual’s “distributing [a] file to an anonymous requester.” Napster, 239 F.3d at 1015. In an academic setting, a researcher’s plagiarism was found to be commercial activity, because in that setting “what is valuable is recognition because it so often influences professional advancement and academic tenure.” Weissmann, 868 F.2d at 1324.

Impressions of Creators and Online Users The foregoing legal authority is broadly consistent with impressions of U.S. creators and online users in an extensive and detailed study conducted by Creative Commons17 of U.S. online users’ understandings of noncommercial use of copyrighted works to help the organization understand the extent to which creators and users of works licensed under its noncommercial licenses agreed concerning what the license term meant.18 That study found that: Both creators and users generally consider uses that earn users money or involve online advertising to be commercial, while uses by organizations, by individuals, or for charitable purposes are less commercial but not decidedly noncommercial. Similarly, uses by for-profit companies are typically considered more commercial.

16 The use is commercial even though that fact may be discounted in a fair use analysis. See 467 F.3d at 254. 17 Creative Commons is a non-profit organization that facilitates legal use of copyrighted works by offering a selection of licenses that help them distribute their works under flexible copyright terms. Several of Creative Commons’ forms of license are limited to noncommercial use. For purposes of those licenses, Creative Commons defines noncommercial as “not primarily intended for or directed towards commercial advantage or monetary compensation.” 18 Creative Commons, Defining “Noncommercial”: A Study of How the Online Population Understands “Noncommercial Use” 18 (Sept. 2009) [hereinafter “CC Study”], available at https://mirrors.creativecommons.org/defining-noncommercial/Defining_Noncommercial_fullreport.pdf. 13

CC Study at 11. While we often disagree with groups like Creative Commons on copyright issues, we agree with the above finding.

We also note that in this study majorities or near-majorities of both creators and users found the following to definitely be commercial uses: • Work used online with advertising – user makes money from the ads • Money would be made directly from the sale of copies of the work • Money would be made from the use of the work in some way • Work used online with advertising – user only covers hosting costs • Work would be used by a for-profit company • Work would be used on a splog [spam blog used to promote affiliated sites] or “zombie website” [one used to perpetrate fraud] • Money would be made from the work, but only enough to cover costs19 CC Study at 54. The only use that majorities of both creators and users found to definitely be a noncommercial use was where “[n]o money would be made from the use of [the] work.” Id.

Synthesizing Guidelines From the discussion above, a few guidelines concerning noncommercial use emerge. These guidelines concerning noncommercial use are intended to apply only in the context of interpreting and applying Section 1401(c), a unique statutory provision that applies only in the narrow context of proposed noncommercial uses of pre-72 recordings that are not being commercially exploited by or under authority of the rights owner, where the rights owner has a concomitant right to opt out of the proposed use.

• Use by for-profit companies should carry a presumption that it is commercial. This would include any case of distribution by a commercial entity or use to promote goods or services, run advertising, otherwise obtain a commercial advantage, or for any other commercial purpose. For a for-profit company to engage in a noncommercial use, the use must be largely disconnected from and make no contribution to the company’s profit-making purpose (for example, it cannot involve advertising, business or product development), cannot result in commercial advantage or monetary or non-monetary compensation, nor can it involve the avoidance of customarily associated costs or expenditures or exploitative use of the kind that normally results in compensation to the rights owner.

• Use by non-profit (i.e., 501(c)(3) tax-exempt) organizations should carry no presumption regarding its commercial or noncommercial nature. In the case of a non- profit organization, the determination should not be based on the organization’s eleemosynary mission or tax-exempt status, but rather must be premised on a careful

19 Presented with scenarios where money was made from use of a work, both creators and users more or less strongly found all of them to be definitely commercial. The least commercial was found to be where a non-profit sells a work to cover its distribution costs. Even where the monetary benefit was indirect, both creators and users strongly believed that use of an entire work for self-promotion was definitely commercial. CC Study at 59. Similarly, both creators and users more or less strongly found all uses involving advertising to be definitely commercial, whether the user or an aggregator benefitted from the ads, and even when the beneficiary of the ad revenue was a non-profit organization. Id. at 61. 14

analysis of the proposed use with a view to assessing whether any direct or indirect benefit(s) will be realized. Uses by a non-profit organization will tend to be considered noncommercial if undertaken for educational, scholarly or similar purposes providing a public benefit. However, that is not the case where the use confers a monetary or non-monetary benefit on the organization itself, such as the avoidance of customarily associated costs or expenditures, or the acquisition of enhanced reputation in the context of such organization’s competition with other similar organizations for members, sponsors or consumers of its services, except in the limited circumstance addressed by Section 1401(c)(2)(A), which allows recovery of the costs of production and distribution of a sound recording resulting from use under Section 1401(c). Except in that limited circumstance, there can be no charge for access to the pre-72 recording used under Section 1401(c), and the organization cannot receive any compensation from advertising or any other source related to the making available of that recording. The use cannot involve distribution by the non- profit organization through a commercial service, because that would be a commercial use; creation of a streaming or download service that competes with one or more commercial services (even if no fee is charged), because that would harm the market for commercial services; the use of one or more sound recordings to attract the public to a fundraising or membership drive; nor can it involve exploitative use of the kind that normally results in compensation to the rights owner.

• Just as with non-profit organizations, use by individuals may be either commercial or noncommercial depending on the circumstances. Personal enjoyment of lawfully acquired content is generally considered noncommercial. Use that results in private financial gain or otherwise confers a benefit on the individual is considered commercial, whether that benefit involves payment or the receipt of advertising revenue (e.g., when an individual uploads a video containing music to YouTube) or it involves non-monetary gain such as acquiring content for free or at a discount, or obtaining reputational benefits. Public dissemination of content is considered commercial, unless that is done without monetary or non-monetary compensation for educational, scholarly or similar purposes. As in the case of use by a non-profit organization, the use cannot involve distribution by the individual through a commercial service, because that would be a commercial use, creation of a streaming or download service that competes with one or more commercial services (even if no fee is charged), because that would harm the market for the commercial service, the use of one or more sound recordings to attract the public to a personal website and it cannot involve exploitative use of the kind that normally results in compensation to the rights owner. b. Disclosure of the Nature of the User

It is apparent from the discussion of possible guidelines above that the nature and identity of the user is relevant to the determination of whether a use is commercial or noncommercial. E.g., Am. Geo. Union, 60 F.3d at 921. Therefore, a user filing an NNU should be required clearly to identify the user including whether the use will be made by a natural or legal person, provide an actual mailing address as well as an email address, and specify exactly what distribution

15 channel(s) will be involved (e.g., a personal website or a commercial service). Those facts are highly relevant to determining whether a use is commercial or noncommercial, meaning that a proposed use cannot meaningfully be evaluated without those facts. Beyond that, as discussed more fully in response to question B.2 below, the more complete the description of the proposed use, the more likely it is that the rights owner will understand the proposed use and, where appropriate, will permit the proposed use to proceed. c. Implications of Accepting a Notice of Pre-1972 Noncommercial Use

It is apparent from the statutory scheme, and the Office regulations should reflect, that neither the Office’s indexing of an NNU nor a rights owner’s providing a Pre-1972 Opt-Out Notice is indicative of whether a proposed use actually qualifies as a noncommercial use.

While the Commenters believe that Section 1401(c) is a process properly and usefully used in only limited circumstances, it is possible that the process will be misused, even if just by users who innocently, but mistakenly, file NNUs for uses that do not qualify as noncommercial. To the extent that any such NNUs are filed, rights owners who identify such NNUs as involving their works and object to the use may choose to file Pre-1972 Opt-Out Notices to avoid any dispute as to whether the use is permissible under Section 1401(c).

However, it is clear from the statutory text that Section 1401(c) is available only for “[n]oncommercial use of a sound recording.” 17 U.S.C. § 1401(c)(1). A use that does not actually qualify as noncommercial does not become noncommercial through the indexing of an NNU (perhaps describing the use vaguely or inaccurately), and there is no need for a rights owner to file a Pre-1972 Opt-Out Notice to avoid the application of Section 1401(c) to a use that does not qualify for Section 1401(c).

The Office’s regulations concerning other recordation functions make clear that when the Office examines documents submitted for recordation, its recordation of a document does not express a legal conclusion concerning the document. 37 C.F.R. § 201.4(g) (“[t]he fact that the Office has recorded a document is not a determination by the Office of the document's validity or legal effect”); §201.10(f)(4) (“[t]he fact that the Office has recorded a notice is not a determination by the Office of the notice’s validity or legal effect”). The same principle should apply to an NNU, and it should be clear that Section 1401(c) does not apply if the proposed use turns out to be commercial, whether as a result of innocent mistake, vague description or intentional misrepresentation. Likewise, the Office’s regulations should confirm that a rights owners’ filing (or not filing) a Pre-1972 Opt-Out Notice does not imply that a use is commercial or noncommercial. In addition, rights owners should be permitted to include in a Pre-1972 Opt-Out Notice a statement indicating that they do not believe the requested use qualifies as noncommercial.20

20 If the Office intends to create a fill-in-the-blank type form of Pre-1972 Opt-Out Notice, it should include a box to check that includes a statement along these lines. If the rights owner fails to include such a statement (or fails to check the appropriate box, if there is one) that also should not lead to any presumptions about whether the use is noncommercial. 16

2. To what extent should a user be required to specify the nature of the use, such as the expected audience, duration of the use, and whether it will be online or limited to a particular geographic area? a. Identifying the Sound Recording at Issue

Before we address the required information concerning the nature of the use, the Commenters wish to highlight the need for users to identify the sound recording they wish to use with sufficient specificity and accuracy for rights owners to determine: precisely which recording the user proposes to use; and whether the sound recording in question is owned by them. Without this critical information, it is impossible for rights owners to exercise their opt-out right in any meaningful way.

If it is not abundantly clear what recording is involved, the person doing the clearance may need to do research to figure that out or, if she is unsure how to do that research, hire a music clearance professional to assist with that process. As discussed further in the comments of SoundExchange, its ISRC Search tool can also help the user understand what the user has. A search engine can be another good tool for such research as can the Copyright Office’s copyright registration records for sound recordings and their underlying musical works. Users can also utilize fingerprinting technology, such as the free app or Audible Magic (if the user has access to that service) to attempt to identify the title and artist of an otherwise unidentified track. Numerous specialized sound recording databases are also available to help users understand sound recording repertoire.21

In order to adequately put rights owners on notice regarding the sound recording that is the subject of a particular NNU, users should be required to provide, at a minimum:

i. The correct title of the relevant sound recording, including information about the version (e.g., live, studio, specific live version, soundtrack version, etc);22 ii. The correct name of the artist; iii. The last known record label or copyright owner (or a statement explaining why the user is unable to provide the information); iv. The year of release (if known); and v. A description of the product or other source where the recording was found. If the user is not able to identify the sound recording with sufficient specificity, the user simply should not be permitted to avail herself of the Section 1401(c) process.23 To protect rights

21 Some useful free reference sources include 45cat (http://www.45cat.com/), AllMusic (https://www.allmusic.com/), Discogs (https://www.discogs.com/search/), Discography of American Historical Recordings (https://adp.library.ucsb.edu/) and the National Jukebox (http://www.loc.gov/jukebox/). Music clearance professionals also sometimes use paid database products like MuzeMusic (http://search.muze.com/html/products/music/muzemusic/index.htm) and the Naxos Music Library (https://www.naxosmusiclibrary.com/home.asp?rurl=%2Fdefault%2Easp). 22 The version information is important because, in the case of musical works that have been recorded multiple times by the same artist, it helps rights owners identify the track as theirs. 23 Even with such a regulation in place, the Commenters are concerned that a handful of users may be inclined to abuse this new system by filing a high volume of NNUs, rather than attempting to clear the relevant uses through the 17 owners from the need to respond to frivolous, burdensome or insufficiently specific NNUs, and to avoid disputes when an NNU passes without objection because the rights owner has insufficient information to recognize a notice as pertaining to one of its works, the Office should refuse to accept an NNU if it does not appear from the face of the document that the necessary identifying information has been provided.24

Allowing users to file NNUs without the necessary identifying information would lead to significant problems and cause the system to be unworkable. More importantly, it is not the way that Congress intended this provision to operate. If the Office chose to accept NNUs without the necessary identifying information, in order to ensure that their interests are adequately protected, many rights owners might feel obligated to file opt-out notices in connection with any inadequately identified sound recording that possibly might be theirs (i.e., on a just-in-case basis). Such a process would be burdensome for rights owners, unsatisfactory for users and would unnecessarily inundate the Office with opt-out notices.25 b. Identifying the Nature of the Use

Turning to the nature of the use, all of the points mentioned in Question B.2 should be specified in an NNU. Just as in a traditional clearance process, a rights owner must understand the who, what, where, why and when of a proposed use in order to decide whether to opt out of the proposed use. Without a complete understanding of the proposed use, a rights owner cannot make an informed decision as to whether to exercise its right to opt out – especially here, where the rights owner has no apparent ability to ask follow-up questions or engage in back-and-forth negotiations with the would-be user.

The duration of the use is particularly important because, in the absence of a term specified in the NNU, each of these uses would presumably have a term equal to the life of the copyright – ordinary clearance process. We ask the Office to be attuned to the usage metrics for this new system and, if any unusual usage patterns appear, to commence a study of the number of repeat users and the volume of NNUs filed annually by each such user. To the extent that users exist who legitimately make frequent noncommercial uses of pre-72 recordings, those users should be establishing lines of communication with the licensing teams at A2IM’s and RIAA’s member companies and using the 1401(c) procedure only in situations where they are unable to identify and/or locate the rights owner. 24 Our members are concerned that, even with regulations requiring that sound recordings be identified with substantial specificity, situations will arise where rights owners are required to decide whether to opt out of a proposed use without being able to determine with certainty that they own the track in question. In light of this, the Commenters ask that the regulations allow rights owners to include qualifying language in their opt-out notices (or include the relevant language as part of a fill-in-the-blank opt-out form) clarifying that they are unable to determine if they are the rights owner because of the lack of specificity in identifying the sound recording but are filing the opt- out notice in an abundance of caution. 25 If the Office chooses to accept NNUs that lack sufficient identifying information regarding the recording at issue, our members will find themselves in the untenable position of having to file opt-out notices in connection with recordings they do not know with certainty that they own, notwithstanding the penalties set forth in Section 1401(c)(6)(B)(i) and (ii) which apply in (i) to “[a]ny person who files an opt-out notice as described in paragraph (1)(C), knowing that the person is not the rights owner or authorized to act on behalf of the rights owner of the sound recording to which the notice pertains, [who] shall be assessed a civil penalty in an amount not less than $250, and not more than $1,000, for each such notice” and in (ii) to “[a]ny person who engages in a pattern or practice of making filings as described in clause (i)[who] shall be assessed a civil penalty in an amount not less than $10,000 for each such filing.” 18 something that is uncommon in noncommercial licensing transactions. Although territory is often a negotiated provision in a voluntary license, because this exception arises under U.S. copyright law, the territory for all NNUs must be limited to an area that does not extend beyond the United States (though the use may be limited to a smaller area such as a particular region, state or metropolitan area).

In commercial licensing transactions, those requesting licenses, whether paid or gratis, generally are required to describe the proposed use in some detail. The same should be required here because it is necessary to permit a meaningful evaluation of the proposed use. Moreover, it seems likely that NNUs that offer only a vague description of the proposed use would routinely be denied – which is not to users’ advantage. The Commenters recommend that the Office create a form NNU that requires users to provide all of the information set forth below. As with the required information identifying the sound recording discussed above, the Commenters believe that the Office, as part of the initial examination process, should reject any NNU that fails to provide every one of the data points listed below. In addition, the user should be required to submit the certified search results described in response to Question B.3 below with the NNU.

• (Tentative) Title of project: • Type of project (e.g., documentary film, museum exhibit, classroom use): • Description of project (synopsis), including all information a rights owner would need to determine if the label and/or the artist/heirs want to be associated with the project (e.g., whether it is an advocacy or political piece and, if so, for what issue, candidate, party or point of view; if it is a documentary film, what the topic is, what point of view it espouses and what the message is; what other trademarks, businesses or persons will be associated with the project, etc.): • Total playing time (in the case of a larger audio or audiovisual work incorporating sound recording): • How the sound recording will be used in the project (e.g., background vocal, background instrumental): • If used in an audio-visual work, identification of what is happening in the scene where the recording would be used (i.e., to make sure that the recording isn’t used in an objectionable scene or in an objectionable context): • Total playing time of the sound recording at issue: • Playing time of the part of the sound recording to be used in the project: • How the finished project will be made available to the public (if for purely personal use, please so indicate; if via a digital service, please specify the name of the service(s) and whether the use will be live-streamed and/or archived for future playback): • Term of use (e.g., 6 months, 1 year): • Territory (e.g., entire U.S. or some smaller geographic area): • Where and how the user will credit the sound recording title, featured artist and rights owner within or in connection with the project:

19

• Whether the underlying musical work (or other underlying work) has been licensed and, if so, whether it was licensed on a gratis basis for a noncommercial use?26 c. The NNU Process Must Apply on a Use-by-Use, Recording-by-Recording Basis

The Commenters urge the Office to make clear in its regulations (and on any NNU form it may create) that the 1401(c) notice process is a use-by-use, recording-by-recording process whereby each notice may address only one proposed use of one specific sound recording. Because the statute requires that both the identity of the sound recording and the nature of the use be identified with particularity, and appears to assume that there will be a 1:1 correspondence between NNUs and opt-out notices, the Commenters see no room for the Office to permit users to list multiple sound recordings and/or multiple uses in one NNU. Even if the Office could do so, such a system would likely disadvantage users in that rights owners faced with a bulk request involving some uses or some recordings that the rights owner would be willing to permit and others that the rights owners would not be willing to permit, would have no choice but to file an opt-out notice covering all of the proposed uses and all of the proposed sound recordings. To the extent that an NNU listed multiple sound recordings owned by different rights owners, it would be difficult, if not impossible, to track which owners had accepted or rejected the proposed uses as to which sound recordings. d. No Inferences Should be Drawn from Prior Searches or Prior NNUs

Users should be instructed to draw no inferences from the fact that a particular sound recording was previously used via the 1401(c) notice process. The fact that another user proposed to use the same sound recording at another time and the rights owner did not opt out has absolutely no bearing on whether that same rights owner chooses to opt out of a subsequent proposed use (whether identical or entirely dissimilar to the earlier use) of the same sound recording. Indeed, it’s clear from the statute that any deviation from the use identified in a particular NNU requires a new NNU to be filed, whether that use is by the same or a different user.

Likewise, there must be no presumption that a particular recording that was not being commercially exploited at the time of a prior search and NNU retains that same status at a future time. Therefore, the regulations should make clear that each user should be required to perform (and document) a full good faith, reasonable search, even if the recording at issue was previously the subject of the 1401(c) process.

26 As noted in the Introduction, sound recordings almost always embody some other work – most often a musical work, but sometimes a literary work such as a comedy routine, or a dramatic work. In order for a user to make use of a particular sound recording, it will generally be necessary to obtain permission to use the underlying musical or literary work as well. Unless the underlying work has fallen into the public domain or the noncommercial use at issue is permitted under one of the limitations of rights (e.g., Sections 107, 108, 110 and 1401(f)(1)), the user will need to secure a license to use the underlying work in order to make the proposed use of the sound recording. To the extent that such a license has already been obtained and the license has been issued on a gratis basis, those facts are likely to be highly relevant to the rights owner in considering how to respond to an NNU, just as they would be in a negotiated transaction that takes place outside of Section 1401(c). Thus, if the goal of the 1401(c) process is to get to “yes,” the Office should encourage would-be users either to obtain all necessary publishing permissions before filing an NNU or to explain in their NNU why no publishing permissions are necessary. 20

3. How should the user be required to certify or describe the steps taken for a search to constitute a ‘‘good faith, reasonable search’’? How detailed should any description be?

In addition to submitting an NNU that adequately identifies the sound recording at issue and the proposed use, the user should be required to provide a certified step-by-step account of all sources searched and the precise search terms used. The written summary should be accompanied by screen shots of each online search performed and any relevant documents evidencing offline searches, if any (e.g., a letter from a library, the Copyright Office search staff or other organization responding to an inquiry). Without such requirements, it will be too easy for users to “game” the system or rely on a prior search involving the same sound recording, a practice the Commenters feel strongly must be prohibited (see response to Question B.2 above). Not only that, in the event of a dispute between a rights owner and a user, the user will want to have a well-documented, contemporaneous record of all steps undertaken in her search.

When documenting the search, each step and screenshot of the search process should include the time and date. In addition, to be “reasonable” a search must have been conducted recently. The Commenters propose requiring that a search be conducted within 90 days of filing an NNU, a time frame that is equivalent to the amount of time a rights owner gets to opt out of a noncommercial use once an NNU is filed. Finally, for each search conducted users should be required to certify the steps of their search and their screen shots under penalty of perjury much like 37 C.F.R. § 201.18(1)(d)(1)(vi) requires those who file a notice of intention (“NOI”) to use the mechanical compulsory license to “include an affirmative statement that with respect to …[each] nondramatic musical work named in the Notice of Intention, the registration records or other public records of the Copyright Office have been searched and found not to identify the name and address of the copyright owner of such work.”

To protect rights owners from the need to respond to frivolous or unwarranted NNUs, the Office should refuse to accept an NNU if the user fails to include a certified step-by-step account of all sources searched, the precise search terms used and proof that all of the categories listed in the Introduction to Section II.A were searched and that no matches were found.

III. Implementation Issues Not Raised in the NOI

The Commenters note that the NOI does not address certain implementation issues related to the 1401(c) process. We recognize that the Office may have been planning to address these issues in the Notice of Proposed Rulemaking (“NPRM”) that will follow this NOI, but we wanted to share our thoughts on two of those issues nevertheless.

a. The Commenters believe there should be a simple and efficient way for rights owners to track all the NNUs that are filed using an online tool. The Commenters encourage the Office to collect all of the NNUs filed pursuant to Section 1401(c) in a single, online database that is publicly accessible, just as it planning to do with the Notices of Contact Information for Transmitting Entities Publicly Performing Pre-1972 Sound Recordings, a preliminary version of which is available at https://www.copyright.gov/music-modernization/pre1972-soundrecordings/notices- contact-information.html. Within such a database, the Commenters urge the Office to

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attach and display an indexing date so that rights owners know when the 90-day opt- out clock starts running. In addition, for ease of review by rights owners, the Commenters ask that the NNUs be displayed in reverse chronological order, just as the Office is planning to do with the pre-72 schedules. See Interim Rule, Filing of Schedules by Rights Owners and Contact Information by Transmitting Entities Relating to Pre-1972 Sound Recordings, 83 Fed. Reg. 52,150 (Oct. 16, 2018) (to be codified at 37 C.F.R. pt. 201) [hereinafter “Interim Rule”]. It is also essential that the NNU database include a separate field for rights owner (whether known or suspected) and that the database be searchable by rights owner (using exact text matching, fuzzy searching and wildcard matching). In order to prevent conflicts and disagreements in the future, the Commenters urge the Office to include a link to the NNU in the NNU database, along with a link to any opt-out notice that is filed in response (or, if the opt-out notices are catalogued separately, to include cross-references linking the NNU and any relevant opt-out notice to one another).

b. Because rights owners only have 90 days to decide whether to opt out of a proposed use, rights owners request that the Office set up an email notification system, like the one required in connection with the pre-72 schedules, see Interim Rule, so that rights owners and/or any agent designated by them will receive email notifications when new NNUs identifying them as the rights owner are posted.27

IV. Conclusion

We appreciate the opportunity to comment on the myriad of issues raised in the NOI. In implementing this clearance method of last resort, we urge the Office to require users of the Section 1401(c) process to (a) identify the sound recording they wish to use with sufficient specificity to allow a rights owner to determine if the work belongs to them, and (b) describe the proposed use with sufficient detail to allow the rights owner to understand the proposed use and make an informed decision whether to opt-out of the proposed use or allow it to go forward. We further encourage the Office, as part of its recordation-like function, to reject NNUs that inadequately identify the sound recording or inadequately describe the proposed use. Lastly, we ask that the Office adopt our proposed guidelines for noncommercial use and our nine-category approach to a good faith, reasonable search.

Dated: November 26, 2018

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27 Of course, this will not help the rights owner identify works that are the subject of an NNU if the user misidentifies the rights owner. 22

Respectfully submitted,

Richard James Burgess, Ph.D. CEO A2IM (The American Association of Independent Music) 132 Delancey Street 2nd Floor New York, NY 10002 (v) 646-588-0433 [email protected]

Susan B. Chertkof Senior Vice President, Business & Legal Affairs Recording Industry Association of America, Inc. 1025 F Street, N.W. 10th Floor Washington, D.C. 20004 (v) 202-775-0101 (f) 202-775-7253 [email protected]

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