Text: S.1670 — 111th Congress (2009-2010)All Bill Information (Except Text)

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Reported to Senate (09/24/2009)

Calendar No. 165

111th CONGRESS
1st Session
S. 1670

To reform and modernize the limitations on exclusive rights relating to secondary transmissions of certain signals.


IN THE SENATE OF THE UNITED STATES
September 15, 2009

Mr. Leahy (for himself, Mr. Sessions, Mr. Kohl, Mr. Hatch, and Mr. Kyl) introduced the following bill; which was read twice and referred to the Committee on the Judiciary

September 24, 2009

Reported by Mr. Leahy, with amendments

[Omit the part struck through and insert the part printed in italic]


A BILL

To reform and modernize the limitations on exclusive rights relating to secondary transmissions of certain signals.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Satellite Television Modernization Act of 2009”.

SEC. 2. Limitations on exclusive rights: Secondary transmissions of superstations and network stations for private home viewing.

Section 119 of title 17, United States Code, is amended—

(1) in subsection (a)—

(A) in paragraph (2)—

(i) in subparagraph (A)—

(I) by striking “subparagraphs (B) and (C)” and inserting “subparagraph (B)”; and

(II) by striking “(5), (6), (7), and (8)” and inserting “(4), (5), (6), and (7)”;

(ii) in subparagraph (B)—

(I) in clause (i), by striking the second sentence; and

(I) in clause (i)—

(aa) in the first sentence, by inserting before the period the following: “, except that a satellite provider lawfully serving a subscriber with a distant network station pursuant to this subparagraph while a network station affiliated with such network was broadcasting in analog shall not be required to re-qualify such subscriber to receive such distant station under the digital predictive model established by the Federal Communications Commission”; and

(bb) by striking the second sentence; and

(II) in clause (ii)—

(aa) in subclause (I)—

(AA) by striking “the Individual Location” and all that follows through “No. 98–201,” and inserting “the predictive digital model established by the Federal Communications Commission,”; and

(BB) by striking “under section 339(c)(3) of the Communications Act of 1934 (47 U.S.C. 339(c)(3))”; and

(aa) in subclause (I), by striking “the court shall rely” and all that follows through the period at the end and insert the following: “a court shall rely, with respect to a signal originating as an analog signal, on the Individual Location Longley-Rice model set forth by the Federal Communications Commission in Docket No. 98–201, and shall rely, with respect to a signal originating as a digital signal, on the predictive model established by the Federal Communications Commission, as that model may be amended over time to increase the accuracy of that model.”; and

(bb) in subclause (II), by striking “section 339(c)(4) of the Communications Act of 1934 (47 U.S.C. 339(c)(4))” and inserting “rules established by the Federal Communications Commission”;

(iii) by striking subparagraph (C);

(iv) by redesignating subparagraph (D) as subparagraph (C); and

(v) in subparagraph (C) (as so redesignated)—

(I) in clause (i), by striking “network station—” and all that follows through the period at the end and inserting “network station a list, aggregated by designated market area (as that term is defined in section 122(j)), identifying (by name and address, including street or rural route number, city, State, and zip code) all subscribers to which the satellite carrier makes secondary transmissions of that primary transmission to subscribers in unserved households.”;

(II) in clause (ii), by striking “the network—” and all that follows through the period at the end and inserting “the network a list, aggregated by designated market area (as that term is defined in section 122(j)), identifying (by name and address, including street or rural route number, city, State, and zip code) any persons who have been added or dropped as subscribers under clause (i)(I) since the last submission under clause (i).”; and

(III) in clause (iv), at the end of the second sentence, by striking the ending quotation mark and semicolon;

(B) by striking paragraph (3);

(C) by redesignating paragraphs (4) through (14) as paragraphs (3) through (13), respectively;

(D) by amending paragraph (3) (as so redesignated) to read as follows:

“(3) STATUTORY LICENSE WHERE RETRANSMISSIONS INTO LOCAL MARKET AVAILABLE.—

“(A) FUTURE APPLICABILITY.—The statutory license under paragraph (2) shall not apply to the secondary transmission by a satellite carrier of a primary transmission of a network station to a person who—

“(i) is not a subscriber lawfully receiving such secondary transmission as of December 31, 2009; and

“(ii) at the time such person seeks to subscribe to receive such secondary transmission, resides in a local market where the satellite carrier makes available to that person the secondary transmission of the primary transmission of a local network station affiliated with the same television network pursuant to the statutory license under section 122, and such secondary transmission of such primary transmission can reach such person.

“(B) OTHER PROVISIONS NOT AFFECTED.—This paragraph shall not affect the applicability of the statutory license to secondary transmissions to unserved households included under paragraph (11).

“(C) WAIVER.—A subscriber who is denied the secondary transmission of a network station under this paragraph may request a waiver from such denial by submitting a request, through the subscriber‘s satellite carrier, to the network station in the local market affiliated with the same network where the subscriber is located. The network station shall accept or reject the subscriber’s request for a waiver within 30 days after receipt of the request. If the network station fails to accept or reject the subscriber's request for a waiver within that 30-day period, that network station shall be deemed to agree to the waiver request. Unless specifically stated by the network station, a waiver that was granted before the date of the enactment of the Satellite Home Viewer Extension and Reauthorization Act of 2004 under section 339(c)(2) of the Communications Act of 1934 (47 U.S.C. 339(c)(2)) shall not constitute a waiver for purposes of this subparagraph.

“(D) AVAILABLE DEFINED.—For purposes of this paragraph, a satellite carrier makes available a secondary transmission of the primary transmission of a local station to a subscriber or person if the satellite carrier offers that secondary transmission to other subscribers who reside in the same nine-digit zip code as that subscriber or person.”;

(E) in paragraph (4) (as so redesignated), by striking “section 509”;

(F) in paragraph (6) (as so redesignated)—

(i) in subparagraph (A)(ii), by striking “$5” and inserting “$250”; and

(ii) in subparagraph (B)—

(I) in clause (i), by striking “$250,000” and inserting “$2,500,000”; and

(II) in clause (ii), by striking “$250,000” and inserting “$2,500,000”;

(G) by striking paragraph (15); and

(H) by redesignating paragraph (16) as paragraph (14);

(2) in subsection (b)—

(A) by striking the subsection heading and inserting “(b) Deposits and distribution of royalty fees.—”; and

(B) in paragraph (1), by striking the matter following subparagraph (B);

(3) by amending subsection (c) to read as follows:

“(c) Adjustment of royalty fees.—

“(1) APPLICABILITY AND DETERMINATION OF ROYALTY FEES.—

“(A) INITIAL FEE.—The appropriate fee for purposes of determining the royalty fee under subsection (b)(1)(B) for the secondary transmission of the primary transmissions of network stations and superstations shall be the appropriate fee set forth in subchapter E of chapter III of title 37, Code of Federal Regulations, as in effect on July 1, 2009, as modified under this paragraph.

“(B) FEE SET BY VOLUNTARY NEGOTIATION.—On or before January 4, 2010, Copyright Royalty Judges shall cause to be published in the Federal Register of the initiation of voluntary negotiation proceedings for the purpose of determining the royalty fee to be paid by satellite carriers for the secondary transmission of the primary transmission of network stations and superstations under subsection (b)(1)(B).

“(C) NEGOTIATIONS.—Satellite carriers, distributors, and copyright owners entitled to royalty fees under this section shall negotiate in good faith in an effort to reach a voluntary agreement or agreements for the payment of royalty fees. Any such satellite carriers, distributors, and copyright owners may at any time negotiate and agree to the royalty fee, and may designate common agents to negotiate, agree to, or pay such fees. If the parties fail to identify common agents, Copyright Royalty Judges shall do so, after requesting recommendations from the parties to the negotiation proceeding. The parties to each negotiation proceeding shall bear the cost thereof.

“(D)(i) AGREEMENTS BINDING ON PARTIES; FILING OF AGREEMENTS; PUBLIC NOTICE.—Voluntary agreements negotiated at any time in accordance with this paragraph shall be binding upon all satellite carriers, distributors, and copyright owners that are parties thereto. Copies of such agreements shall be filed with the Copyright Office within 30 days after execution in accordance with regulations that the Register of Copyrights shall prescribe.

“(ii)(I) Within 10 days after publication in the Federal Register of a notice of the initiation of voluntary negotiation proceedings, parties who have reached a voluntary agreement may request that the royalty fees in that agreement be applied to all satellite carriers, distributors, and copyright owners without convening a proceeding pursuant to subparagraph (F).

“(II) Upon receiving a request under subclause (I), the Copyright Royalty Judges shall immediately provide public notice of the royalty fees from the voluntary agreement and afford parties an opportunity to state that they object to those fees.

“(III) The Copyright Royalty Judges shall adopt the royalty fees from the voluntary agreement for all satellite carriers, distributors, and copyright owners without convening a proceeding unless a party with an intent to participate in the proceeding and a significant interest in the outcome of that proceeding objects under subclause (II).

“(E) PERIOD AGREEMENT IS IN EFFECT.—The obligation to pay the royalty fees established under a voluntary agreement which has been filed with the Copyright Office in accordance with this paragraph shall become effective on the date specified in the agreement, and shall remain in effect until December 31, 2014, or in accordance with the terms of the agreement, whichever is later.

“(F) PROCEEDING TO ESTABLISH ROYALTY FEES.—

“(i) NOTICE OF INITIATION OF PROCEEDINGS; VOLUNTARY AGREEMENTS.—On or before May 3, 2010, the Copyright Royalty Judges shall cause notice to be published in the Federal Register of the initiation of proceedings for the purpose of determining the royalty fee to be paid for the secondary transmission of primary transmission of network stations and superstations under subsection (b)(1)(B) by satellite carriers and distributors—

“(I) in the absence of a voluntary agreement filed in accordance with subparagraph (D) that establishes royalty fees to be paid by all satellite carriers and distributors; or

“(II) if an objection to the fees from a voluntary agreement submitted for adoption by the Copyright Royalty Judges to apply to all satellite carriers, distributors, and copyright owners is received under subparagraph (D) from a party with an intent to participate in the proceeding and a significant interest in the outcome of that proceeding.

Such proceeding shall be conducted as provided under chapter 8 of this title.

“(ii) ESTABLISHMENT OF ROYALTY FEES.—In determining royalty fees under this paragraph, the Copyright Royalty Judges shall establish fees for the secondary transmissions of the primary transmission of network stations and superstations that most clearly represent the fair market value of secondary transmissions, except that the Copyright Royalty Judges shall adjust those fees to account for the obligations of the parties under any applicable voluntary agreement filed with the Copyright Office pursuant to subparagraph (D). In determining the fair market value, the Copyright Royalty Judges shall base their decision on economic, competitive, and programming information presented by the parties, including—

“(I) the competitive environment in which such programming is distributed, the cost of similar signals in similar private and compulsory license marketplaces, and any special features and conditions of the retransmission marketplace;

“(II) the economic impact of such fees on copyright owners and satellite carriers; and

“(III) the impact on the continued availability of secondary transmissions to the public.

“(iii) PERIOD DURING WHICH DECISION OF COPYRIGHT ROYALTY JUDGES EFFECTIVE.—The obligation to pay the royalty fee established under a determination which is made by the Copyright Royalty Judges under this paragraph shall be effective as of January 1, 2010.

“(iv) PERSONS SUBJECT TO ROYALTY FEE.—The royalty fee referred to clause (iii) shall be binding on all satellite carriers, distributors, and copyright owners, who are not party to a voluntary agreement filed with the Copyright Office under subparagraph (D).

“(2) ROYALTY FEE ANNUAL ADJUSTMENT.—The royalty fee payable under subsection (b)(1)(B) for the secondary transmission of the primary transmission of network stations and superstations shall be adjusted annually by the Copyright Royalty Judges to reflect any changes occurring during the preceding 12 months in the cost of living as determined by the most recent Consumer Price Index (for all consumers and items) published by the Secretary of Labor prior to December 1. Notification of the adjusted rates shall be published in the Federal Register prior to December 1 of that year.”;

(4) in subsection (d)—

(A) in paragraph (10)—

(i) by amending subparagraph (A) to read as follows:

“(A)(i) is located in a local market in which there is no primary network station affiliated with such network licensed to a community within such local market; or

“(ii) cannot receive, through the use of a conventional, stationary, outdoor rooftop receiving antenna, an over-the-air signal of a primary network station affiliated with that network that does not exceed the signal intensity standard in section 73.622(e)(1) of title 47 of the Code of Federal Regulations as in effect on January 1, 2010;”;

“(ii) cannot receive through the use of a conventional, stationary, outdoor rooftop receiving antenna, an—

“(I) over-the-air analog signal of a primary network station affiliated with that network that does not exceed Grade B intensity as defined by the Federal Communications Commission under section 73.683(a) of title 47 of the Code of Federal Regulations, as in effect on January 1, 1999; or

“(II) over-the-air digital signal of a primary network station located in that household's local market affiliated with that network that does not exceed the signal intensity standard in section 73.622(3)(1) of title 47 of the Code of Federal Regulations, as in effect on January 1, 2010;”;

(ii) in subparagraph (B), by striking “(a)(14)” and inserting “(a)(13)”; and;

(iii) in subparagraph (D), by striking “(a)(12)” and inserting “(a)(101 (a)(11)”;

(B) in paragraph (11), by striking “, except that” and all that follows through “located”;

(C) by striking paragraph (12); and

(D) by redesignating paragraph (13) as paragraph (12); and

(5) by striking subsection (f).

SEC. 3. Limitations on exclusive rights: Secondary transmissions by satellite carriers within local markets.

Section 122 of title 17, United States Code, is amended—

(1) by amending subsections (a), (b), and (c) to read as follows:

“(a) Secondary transmissions of television broadcast stations by satellite carriers.—

“(1) SECONDARY TRANSMISSIONS OF TELEVISION BROADCAST STATIONS WITHIN A LOCAL MARKET.—A secondary transmission of a performance or display of a work embodied in a primary transmission of a television broadcast station into the station's local market shall be subject to statutory licensing under this section if—

“(A) the secondary transmission is made by a satellite carrier to the public;

“(B) with regard to secondary transmissions, the satellite carrier is in compliance with the rules, regulations, or authorizations of the Federal Communications Commission governing the carriage of television broadcast station signals; and

“(C) the satellite carrier makes a direct or indirect charge for the secondary transmission to—

“(i) each subscriber receiving the secondary transmission; or

“(ii) a distributor that has contracted with the satellite carrier for direct or indirect delivery of the secondary transmission to the public.

“(2) SIGNIFICANTLY VIEWED AND LOW POWER STATIONS.—A secondary transmission of a performance or a display of a work embodied in a primary transmission of a television broadcast station or low power television station to subscribers who receive secondary transmissions of primary transmissions under paragraph (1) shall, if the secondary transmission is made by a satellite carrier that complies with the requirements of paragraph (1), be subject to statutory licensing under this paragraph as follows:

“(A) SECONDARY TRANSMISSIONS OF SIGNIFICANTLY VIEWED SIGNALS.—The statutory license shall apply to the secondary transmission of the primary transmission of a network station or a superstation to a subscriber who resides outside the station's local market but within a community in which the signal has been determined by the Federal Communications Commission, to be significantly viewed in such community, pursuant to the rules, regulations, and authorizations of the Federal Communications Commission in effect on April 15, 1976, applicable to determining with respect to a cable system whether signals are significantly viewed in a community.

“(B) CARRIAGE OF LOW POWER TELEVISION STATIONS.—

“(i) IN GENERAL.—The statutory license shall apply to the secondary transmission of the primary transmission of a network station or a superstation station that is licensed as a low power television station, to a subscriber who resides within the same local market within the same designated market area.

“(ii) NO APPLICABILITY TO REPEATERS AND TRANSLATORS.—Secondary transmissions provided for in subparagraph (A) shall not apply to any low power television station that retransmits the programs and signals of another television station for more than 2 hours each day.

“(3) SPECIAL EXCEPTIONS.—A secondary transmission of a performance or a display of a work embodied in a primary transmission of a television broadcast station to subscribers who receive secondary transmissions of primary transmissions under paragraph (1) shall, if the secondary transmission is made by a satellite carrier that complies with the requirements of paragraph (1), be subject to statutory licensing under this paragraph as follows:

“(A) STATES WITH SINGLE FULL-POWER NETWORK STATION.—In a State in which there is licensed by the Federal Communications Commission a single full-power station that was a network station on January 1, 1995, the statutory license provided for in this paragraph shall apply to the secondary transmission by a satellite carrier of the primary transmission of that station to any subscriber in a community that is located within that State and that is not within the first 50 television markets as listed in the regulations of the Commission as in effect on such date (47 C.F.R. 76.51).

“(B) STATES WITH ALL NETWORK STATIONS AND SUPERSTATIONS IN SAME LOCAL MARKET.—In a State in which all network stations and superstations licensed by the Federal Communications Commission within that State as of January 1, 1995, are assigned to the same local market and that local market does not encompass all counties of that State, the statutory license provided under this paragraph shall apply to the secondary transmission by a satellite carrier of the primary transmissions of such station to all subscribers in the State who reside in a local market that is within the first 50 major television markets as listed in the regulations of the Commission as in effect on such date (section 76.51 of title 47 of the Code of Federal Regulations).

“(C) ADDITIONAL STATIONS.—In the case of that State in which are located 4 counties that—

“(i) on January 1, 2004, were in local markets principally comprised of counties in another State; and

“(ii) had a combined total of 41,340 television households, according to the U.S. Television Household Estimates by Nielsen Media Research for 2004,

the statutory license provided under this paragraph shall apply to secondary transmissions by a satellite carrier to subscribers in any such county of the primary transmissions of any network station located in that State, if the satellite carrier was making such secondary transmissions to any subscribers in that county on January 1, 2004.

“(D) CERTAIN ADDITIONAL STATIONS.—If 2 adjacent counties in a single State are in a local market comprised principally of counties located in another State, the statutory license provided for in this paragraph shall apply to the secondary transmission by a satellite carrier to subscribers in those 2 counties of the primary transmissions of any network station located in the capital of the State in which such 2 counties are located, if—

“(i) the 2 counties are located in a local market that is in the top 100 markets for the year 2003 according to Nielsen Media Research; and

“(ii) the total number of television households in the 2 counties combined did not exceed 10,000 for the year 2003 according to Nielsen Media Research.

“(E) NETWORKS OF NONCOMMERCIAL EDUCATIONAL BROADCAST STATIONS.—In the case of a system of 3 or more noncommercial educational broadcast stations licensed by a single State, political, educational, or special purpose subdivision of a State, or a public agency, the statutory license provided for in this paragraph shall apply to the secondary transmission of that system to any subscriber in any county or county equivalent within that State that is located in a designated market that is not otherwise eligible to receive secondary transmissions of a noncommercial television broadcast station located within that State pursuant to paragraph (1). If a satellite carrier makes secondary transmissions to an adjacent underserved county, local noncommercial educational broadcast stations shall not be repositioned in the channel lineup as a consequence of these retransmissions.

“(4) SHORT MARKETS.—A secondary transmission of a performance of a display of a work embodied in a primary transmission of a television broadcast station to subscribers who receive secondary transmissions of primary transmissions under paragraph (1) shall be subject to statutory licensing under this paragraph if the secondary transmission is of a primary transmission of a network station from a market adjacent to such local market and no station affiliated with such network is licensed to a community within the local market.

“(5) APPLICABILITY OF ROYALTY RATES.—The royalty rates under section 119(b)(1)(B) shall apply to the secondary transmissions to which the statutory license under paragraphs (3) and (4) apply.

“(b) Reporting requirements.—

“(1) INITIAL LISTS.—A satellite carrier that makes secondary transmissions of a primary transmission made by a network station under subsection (a) shall, within 90 days after commencing such secondary transmissions, submit to the network that owns or is affiliated with the network station—

“(A) a list, aggregated by designated market area (as that term is defined in subsection (j)), identifying (by name in alphabetical order and street address, including county and zip code) all subscribers to which the satellite carrier makes secondary transmissions of that primary transmission under subsection (a); and

“(B) a list, to be prepared and submitted separately from the list required under subparagraph (A), aggregated by designated market area (by name and address, including street or rural route number, city, State, and zip code), which shall indicate those subscribers being served pursuant to paragraphs (2), (3), or (4) of subsection (a).

“(2) SUBSEQUENT LISTS.—After the list is submitted under paragraph (1), the satellite carrier shall, on the 15th of each month, submit to the network—

“(A) a list, aggregated by designated market area (as that term is defined in subsection (j)), identifying (by name in alphabetical order and street address, including county and zip code) any subscribers who have been added or dropped as subscribers since the last submission under this subsection; and

“(B) a list, to be prepared and submitted separately from the list required under subparagraph (A), aggregated by designated market area (by name and street address, including street or rural route number, city, State, and zip code), identifying those subscribers whose service pursuant to paragraphs (2), (3), or (4) of subsection (a) has been added or dropped.

“(3) USE OF SUBSCRIBER INFORMATION.—Subscriber information submitted by a satellite carrier under this subsection may be used only for the purposes of monitoring compliance by the satellite carrier with this section.

“(4) REQUIREMENTS OF NETWORKS.—The submission requirements of this subsection shall apply to a satellite carrier only if the network to which the submissions are to be made places on file with the Register of Copyrights a document identifying the name and address of the person to whom such submissions are to be made. The Register of Copyrights shall maintain for public inspection a file of all such documents.

“(c) No royalty fee required for certain secondary transmissions.—A satellite carrier whose secondary transmissions are subject to statutory licensing under paragraphs (1) and (2) of subsection (a) shall have no royalty obligation for such secondary transmissions.”;

(2) in subsection (f)—

(A) in paragraph (1)(B), by striking “$5” and inserting “$250”; and

(B) in paragraph (2)—

(i) in subparagraph (A)(ii), by striking “$250,000” and inserting “$2,500,000”; and

(ii) in subparagraph (B)(ii), by striking “$250,000” and inserting “$2,500,000”; and

(3) in subsection (j)—

(A) by redesignating paragraphs (3), (4), and (5) as paragraphs (4), (5), and (6), respectively; and

(B) by inserting after paragraph (2) the following new paragraph:

“(3) LOW POWER TELEVISION STATION.—The term ‘low power television station’ means a low power television as defined under section 74.701(f) of title 47, Code of Federal Regulations, as in effect on June 1, 2004. For purposes of this paragraph, the term ‘low power television station’ includes a low power television station that has been accorded primary status as a Class A television licensee under section 73.6001(a) of title 47, Code of Federal Regulations.”.

SEC. 4. Technical and conforming amendments.

Section 338(a) of the Communications Act of 1934 (47 U.S.C. 338(a)) is amended—

(1) by amending the first paragraph (3) to read as follows:

“(3) CARRIAGE OF LOW POWER, SIGNIFICANTLY VIEWED, AND SPECIAL EXCEPTION STATIONS OPTIONAL.—No station whose signal is provided under paragraph (2) or (3) of section 122(a) of title 17,

“(3) Carriage of low power, significantly viewed, special exception, and short market stations optional.—No station whose signal is provided under paragraph (2), (3), or (4) of section 122(a) of title 17, United States Code, shall be entitled to insist on carriage under this section, regardless of whether the satellite carrier provides secondary transmissions of the primary transmissions of other stations in the same local market pursuant to such section 122, nor shall any such carriage be considered in connection with the requirements of subsection (c) of this section.”; and

(2) by redesignating the second paragraph (3) (relating to effective date) and paragraph (4) as paragraphs (4) and (5), respectively.

SEC. 5. Extension of authority.

Section 4(a) of the Satellite Home Viewer Act of 1994 (17 U.S.C. 119 note; Public Law 103–369) is amended by striking “December 31, 2009” and inserting “December 31, 2014”.

SEC. 6. Modifications to the cable statutory license.

(a) Update and clarification of royalty calculation methodology.—Section 111(d)(1) of title 17, United States Code, is amended by striking subparagraphs (B), (C), and (D) and inserting the following:

“(B) except in the case of a cable system whose royalty fee is specified in subparagraph (C) or (D) (E) or (F), a total royalty fee for the period covered by the statement, computed on the basis of specified percentages of the gross receipts from subscribers to the cable service during said period for the basic service of providing secondary transmissions of primary broadcast transmitters, as follows:

“(i) 1.064 per centum for the privilege of further transmitting any nonnetwork programming of a primary transmitter in whole or in part beyond the local service area of such primary transmitter, such amount to be applied against the fee, if any, payable pursuant to clauses (ii) through (iv).

“(ii) 1.064 per centum of such gross receipts for the first distant signal equivalent.

“(iii) 0.701 of 1 per centum of such gross receipts for each of the second, third, and fourth distant signal equivalents.

“(iv) 0.330 of 1 per centum of such gross receipts for the fifth distant signal equivalent and each distant signal equivalent thereafter;

“(C) in computing the amounts payable under clauses (ii) through (iv) of subparagraph (B), any fraction of a distant signal equivalent shall be computed at its fractional value or in the case of any cable system located partly within and partly without the local service area of a primary transmitter, gross receipts shall be limited to those gross receipts derived from subscribers located without the local service area of such primary transmitter;

“(D) in computing the amounts payable under clauses (ii) through (iv) of subparagraph (B), if a cable system provides a secondary transmission of a primary transmitter to some but not all communities served by that cable system, the gross receipts and the distant signal equivalent values for each secondary transmission shall be derived solely on the basis of the subscribers in those communities where the cable system provides each such secondary transmission, provided, however, that the total royalty fee for the period paid by such system shall in no event be less than the royalty fee calculated in accordance with clause (i) of subparagraph (B) multiplied by the gross receipts from all subscribers to the system; and provided further, that a cable system that on a statement submitted prior to the date of enactment of the Satellite Television Modernization Act of 2009, computed its royalty fee consistent with the methodology in this subparagraph this paragraph or that amends a statement filed prior to the date of enactment of such Act to compute the royalty fee due using this methodology shall not be subject to an action for infringement, or eligible for any royalty refund, arising out of its use of such methodology on such statement;

“(E) if the actual gross receipts paid by subscribers to a cable system for the period covered by the statement for the basic service of providing secondary transmissions of primary broadcast transmitters total $263,800 or less, gross receipts of the cable system for the purpose of this subparagraph shall be computed by subtracting from such actual gross receipts the amount by which $263,800 exceeds such actual gross receipts, except that in no case shall a cable system's gross receipts be reduced to less than $10,400. The royalty fee payable under this subparagraph shall be 0.5 of 1 per centum, regardless of the number of distant signal equivalents, if any; and

“(F) if the actual gross receipts paid by subscribers to a cable system for the period covered by the statement for the basic service of providing secondary transmissions of primary broadcast transmitters are more than $263,800 but less than $527,600, the royalty fee payable under this subparagraph shall be—

“(i) 0.5 of 1 per centum of any gross receipts up to $263,800; and

“(ii) 1 per centum of any gross receipts in excess of $263,800 but less than $527,600 regardless of the number of distant signal equivalents, if any.”.

(b) No quinquennial adjustments until 2015.—Section 804(b) of title 17, United States Code, is amended by striking “2005” each place that term appears and inserting “2015”.

(c) Acceptance of additional deposits.—Any royalty fee payments received by the Copyright Office from cable systems for the secondary transmission of primary broadcast transmitters (as such terms are defined in subsection (f) of section 111 of title 17, United States Code) that are in addition to the payments calculated and deposited in accordance with subsection (d) of such section 111 shall be deemed to have been deposited for the particular accounting period during which they are received and shall be distributed as specified in subsection (d) of such section 111.

(d) Effective date of new royalty fee rates.—The royalty fee rates established in section 111(d)(1)(B) of title 17, United States Code, as amended by subsection (a), shall take effect beginning with the statement of account covering the first accounting period in 2010.

SEC. 7. Report on market based alternatives to statutory licensing.

Not later than 1 year after the date of enactment of this Act, and after consultation with the Federal Communications Commission, the Copyright Office of the Library of Congress shall submit to the Committees on the Judiciary of the Senate and House of Representatives a report containing—

(1) proposed mechanisms, methods, and recommendations on how to implement a phase-out of the current statutory licensing requirements set forth under sections 111, 119, and 122 of title 17, United States Code, by making such sections inapplicable to the retransmission of a performance or display of a work embodied in a primary transmission of a broadcast station that is authorized to license the same retransmission directly with respect to all of the performances and displays embodied in its primary transmission;

(2) any recommendations for alternative means to implement a timely and effective phase-out of the current statutory licensing requirements set forth under sections 111, 119, and 122 of title 17, United States Code; and

(3) any recommendations for legislative or administrative actions as may be appropriate to achieve such a phase-out.


Calendar No. 165

111th CONGRESS
     1st Session
S. 1670

A BILL
To reform and modernize the limitations on exclusive rights relating to secondary transmissions of certain signals.

September 24, 2009
Reported with amendments