Yeah. We will be right back. My bad chair, thank you. We are going to go back into the Committee Hearing with we are going to go back to the Committee Hearing with the instructions from the chair. He will be here shortly. And thank you senator blackburn for joining. Senator blackburn, do you intend to ask any questions . I do have a few questions. Im wondering. If you want to go ahead, the chairman has let us start the committee again. He will be here shortly. I can defer, i will be here for the duration of the hearing. In interest of your time, if you would, i dont want to rush you, but senator blackburn. Thank you, mister chairman. And i want to say thank you so much to you for being here. One of the things that i wanted to talk with you about, of course, being from tennessee, copyright is terribly important to us. As we like to say, three courts and the truth get you a long way. When it comes to the music industry. We worked on things like the music modernization act and have tried to push forward some of those concepts that. , will strengthen copyright protections. Also strengthen against infringements, which, as you know, has become really quite a an issue. I dont want you to comment on this case but i do want you to walk through with me how you look at potential implications for a broad fair use standard. And i have filed an amicus in the Andy Warhol Foundation versus goldsmith. That is currently before the Supreme Court. Of course, that really broad fair use standard it is something that can be easily abused. I would love for you to comment for a couple minutes on that. Thank you. The warhol case is the Supreme Court has taken up fair use issues outside the context sorry, do i need to repeat . Its going to be very important for the future of the fair use doctrine for copyright. The Copyright Office worked with the department of justice and signed on to the governments brief in the case, which makes a number of important points. Taking the side of the photographer. The main points we are concerned about our what it does transformative use mean exactly . And how do you interpret it . In particular, if transformative use is interpreted to broadly, it could undermine the existence of the derivative work right and copyright law. Because if anything that changes the original is called transformative, then there is no more separate derivative work right which is defined to me as something that changes aspects of the original work. Its a new version of the original. One issue is how do you define what is transformative and avoid making it so broad that it covers all derivative works . The other question is, what is the impact of a funding of transformative use and the Fair Use Analysis . Because the Supreme Court has cautioned in the past that no one factor should control the entire fair use determination. Its important that even if a use is found to be transformative, that the court still go through all the ferries factors and way all the facts and circumstances of the case in light of those factors. For all of those reasons, we are watching very carefully what the court will do. We urge the court to interpret transformative use not to bradley and to put an end to its proper place in a full fare use analysis. I think its also very important in this case to bear in mind that its a case involving a use of photograph for the same purpose that the photographer herself is licensing it for used to illustrate a Magazine Article about the subject. Thats quite different than, for example, they use in an art exhibit in a museum. Those were some of the concerns we had and the reasons we participated in the governments brief. Yes. And we appreciate that. One quick thing before i turn it over to the chairman. Is it still the case that the United States is one of only a few countries that does not recognize a Performance Rights . Yes. You are referring to the Public Performance right for sound recordings. Yes. We have a narrow Public Performance right for sound recordings but not broadcasting them over the air. You are absolutely right. We are an out liar internationally in that respect. Its anomalous as a matter of u. S. Law as well because broadcasters do pay for the use of musical works when they broadcast them. But they do not pay that performers and record producers for the use of the particular recording of the musical work. And im hopeful we can soon change that. Thank you. Thank you, mister chairman. Thank you. And i think senator tillis, i also the majority weve tried to keep things running. I apologize and that these votes got a little bit a different than we thought they would be. For the last i have tried to provide royalties. I tried in 2009. In a small state like mine, the radio stations are still rural areas. They know they can go out of business if they pay now we have to make sure the copyright receiver oil teas. Making those royalties eligible for small market radio stations. American music fairness act was wellintentioned. Does it address the concerns of a small town . Radio stations it could force them out of broadcast business. Im not axe asking for an answer or how we fix them today. I think we should continue to work on that because sometimes in small communities in rural areas, local radio stations one thing that keeps the people posted on whats going on. The news. Also theyve got to pay the bills to make it work. But i applaud you and your launch in june of the copyright claims forward. Ive thought for a long time that its a way for creators to have an inexpensive way to protect themselves from intellectual property theft. You know, in the digital age, there are more and more ways to steal intellectual property. The ccp will give the ordinary americans a day in Court Without the cost of the a typical lawsuit. I think the process you set up seems very user friendly. If you can keep us posted on how it is going so far. Have you had concerns or complaints about filing . Its going very well, in fact we put together an electronic Case Management system for the ccb, the entire staff put in place a large number of regulations necessary to govern all the operations and have been doing a lot of publicity and outreach to make sure people know about it. And all that has been going smoothly. So far, ccb those instructions are available to the public . Yes. Yes. In many different formats at this point. We have been engaging with the media. We have materials on our website, we had a website with q a about the forum, about the new tribunal, even before it started. Now we have a dedicated website for the tribunal as well. We are doing a lot of speeches and public events. To make sure that we reach out as broadly as we can to make sure people are aware this is an opportunity for them. It has been going for smoothly. We are not aware of any particular problems at this point. As of the beginning of this week, there were nearly 150 claims that have been failed in the approximately two months that the tribunals has been in operation. Thats more than i would have expected. Thats very interesting. Its going to be interesting because its very difficult to predict exactly how busy they will be. We dont know yet how many respondents will choose to participate or opt out and its going to take a little bit of time to have more data because there is various periods built into the statute for people to for claimants to serve the claim after it is approved as compliant by the ccb. Another 60 days for respondents to respond or opt out. In a few months, we should have a better sense of where it is going. You hence your office have worked for mine. The question of privacy issues. The system oversees party city, in a state that doesnt put, information or names. Can you make sure that if this protection of privacy starts having problems, that you will let us know . Yes, absolutely. We are very focused on that and we appreciate your offices interest in this. We do have in our general counsels office a number of experienced privacy lawyers who are very familiar with the laws and a library of congresss rules about privacy. We are focusing on it throughout the process. Thank. You im going to have further questions. Senator tillis. Ill defer to senator padilla, im gonna be here for the duration. Senator, thank you for being here. Thank you. I will follow you. Senators. Im going to be pretty brief. The main issue question i was going to raise has already been raised by senator blackburn. Im just here to underscore, first of all thank senator leahy for his years of work on the American Music fairness act. Ive heard your response about the need to fairly compensate both copyright or nurse and for broadcast of their content. I soon thats a position im looking forward to making the latest legislative effort in that regard in the very near future and just as they cut the tail end of your remarks to make sure they make it clearly, the United States is an outlier, remains an outlier on this issue. There are very few countries that dont provide a broadcasting right for sound recordings, at least a remuneration of right. Because many of them provide this right only on a reciprocal basis, they are not paying american performers and Record Companies for the use of their recordings. We are leaving a lot of money on the table abroad that could be coming into the United States. Thank you very much. I look forward to working with you on the issue and technical guidance if necessary. Thank you, mister chairman. Senator tillis . Well, thanks again. I think youve done a great job. I appreciate the progress that was embodied in your opening comments. I think compressing the time being more responsive, replying technology, are all the things i like to hear, and seldom do, in other oversight hearings. Thank you for your work. I want to talk about the letter last month that you sent to me in the office regarding deferred registration examinations. You said that youd heard the concerns of some of the proponents of and you are looking at alternatives, alternative approaches. You outlined some in your letter. Can you elaborate a little bit more on the alternative approaches and explain the nature, scope, and status of your review . Certainly. Thank you, senator. We are evaluating a number of options, as you indicated. We are looking at the legal aspects and technological aspects, and what the Practical Impacts would be of each of them. We are considering them very seriously. If you could also touch on i want you to go through it but touch on which of these you can achieve through your current regulatory authorities and what may need additional congressional action. Thank you. We dont see the statute as a barrier to any of the proposals we are considering. But they do require some technological changes. So we are looking into that as we develop a New Enterprise copyright system. That doesnt mean we will wait until this system is completed before we do anything. But a lot of these would have to be part of that development. In particular, we are looking at the possibility of the dynamic Fee Structure going forward, where some things may be lower thans they are today and some higher. Also the possibility of subscription pricing options, which stakeholders have expressed interest in. We have to see how those can be accommodated from a technological perspective. We are also looking at increasing the maximum limit on the number of photographs that can be registered as part of one group application. We are working with the libraries chief Information Officer on how we can do that. We are also looking at that Technology Necessary for apis to enable software, hardware, thirdparty organizations to achieve integration with our system. More immediately, in the coming fiscal year we do plan to issue a notice of proposed rulemaking on a new Group Registration option for two dimensional artwork. We think a lot of those things respond to the concerns raised in the deferred examination study. Can you talk a bit more, or you have any more specifics to provide on the the way the fees would work or the Fee Structures . We are beginning to look into that. Historically, the office has done a new fee study about every five years. The last one was started in 2017. The new Fee Structure went into place in 2020. Its about time for us to start focusing on this. As you know, we just hired our first chief economist in the office. The chief economist is beginning by looking into what the demand side, doing research on the demand side, what demand there is, what flexibilities there are and what the Price Sensitivity of different kinds of registrantss. Looking also at art costs and registering and recording different kinds of materials. Hes beginning with that study. Once the steady is complete, we will use it to inform a notice of public inquiry, where we will get comments from the public on the policy issues involved in changing the fees structure. I cannot tell you now exactly what will be, but we are starting the process. All right. What kind of timeline should we expect . We will win our intent is to start the process in calendar year 2023. Okay. Also in response to a letter that senator leahy, the chairman and i, sent back in june, you held a series of consultations this summer on technical measures. That identify or protect copyright works. Do you have any initial expressions impressions from those initial workgroup discussions . Yes. Theyve been very helpful discussions and quite intensive. We had both plenary sessions and Small Group Sessions of small kinds. We are still analyzing the wealth of information we are receiving. We receive Something Like 6000 written comments. Theres a lot of material to go through. I would say, so far, what is clear is that there was some convergence on the issues that were important to look at. And that included, first of all, and this is an issue we raised also in our section 5 12 report a couple years ago, that there is a wide variety of context in which technical measures are used and a wide righty of purposes for which they are used. Second, there was a lot of focus on the importance of being able to obtain quality meta data for technologies that allow identification and attribution of content. A third issue, the impact of the different, the differential impact of using either automation or human review for some of these processes. And then, a lot of interest in having the government, particularly the Copyright Office act, as a convenor to bring people together. What we are doing now is drilling down to these issues of it and we will be identifying for you and what are the areas of consensus and the areas of divergence on those topics. We think that will be a useful exercise. Mister chair, if i may, i was going to ask you about areas of consensus. One, do you feel like lee stakeholder groups well represented across the spectrum . And number two, is there any particular area consensus is great, particularly any areas and that are pointing toward a trend that we may have some more state hurdle work to do . Finally, when should we expect a written work product out of it . We had very good participation in the sessions. Very broad representation of different interests. In terms of consensus arising, there is consensus on what the issues are. And the value of the government convening. But as to the specifics of how those issues should be resolved consensus on problems, not solutions . Probably. Although, we are still engaging in that analysis. We are trying to pull out whatever consensus on ways forward we can find. And we will be able to give you more information on that. Our goal is to send over a report out by the end of the year. It will be fairly soon. Thank you. Thank you, mister chair. Thank you. Let me go over another area. Last year, senator tillis and i asked you to identify encourage use of technical majors like fingerprinting that might protect work online. The ncaa intended to make technical measures mandatory. In more than 35 years, no court has mandatory for any platform. I thank you for undertaking the work of conducting feedback sessions on the existing opportunities, the use of mechanical or technical measures. You try to balance the competing interests among stakeholders. Both senator tillis have said often about pretty complex technical, technological problems. Many other agencies that had office, the department of energy have achieved technology analysis. The Copyright Office benefits from having a chief Technology Office . Weve been thinking about that question and are aware that there is been discussion of that in this subcommittee. We currently work very closely with the library of congresss chief Information Officer and her staff. Of course, that function has been centralized in the library of congress. Especially, we are working very intensively in partnership with them on the Modernization Initiative and the enterprise copyright system. We have also developed and brought into inhouse experience and expertise in the Copyright Office itself. Working on many of these issues. So far, that combination of the libraries expertise and our expertise has been sufficient to address our current needs for analyzing technology. Of course, we do a lot of consultations with stakeholders also about technological issues. But it is true that technology continues to grow in importance and affect everything we do. We are taking on more responsibilities and more roles in large part at the request of or a mandate of congress. I will say additional expertise could also be useful. Theres no question that the Technology Issues are not going away. They will become even more important overtime. I know everybody has questions on royalty. Well funded publ