,,ii #aaeth ,,congress #b;d ,session ,s4 #bhbc ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,may #aj1 #bjah,mr4 ,hatch 7for himself1 ,mr4 ,grassley1 ,mr4 ,whitehouse1 ,mr4 ,alexander1 ,mr4 ,coons1 ,mr4 ,kennedy1 ,ms4 ,harris1 ,mr4 ,corker1 ,mr4 ,durbin1 ,mr4 ,isakson1 ,mr4 ,leahy1 ,mr4 ,crapo1 ,mr4 ,jones1 ,mr4 ,tillis1 ,mr4 ,perdue1 ,mrs4 ,capito1 ,mr4 ,nelson1 and ,mr4 ,blunt7 introduced the following bill2 which was read twice and referred to the ,committee on the ,judiciary ,a ,,bill ,to modernize copyright law1 and for other purposes4 #a4 ,short title2 table of contents 7a7 ,short title ,this ,act may be cited as the ,music ,modernization ,act4 7b7 ,table of contents ,the table of contents for this ,act is as follows3 ,sec4 #a4 ,short title2 table of contents4,sec4 #b4 ,rescission of unobligated balances in the ,department of ,justice ,assets ,forfeiture ,fund4,title ,i--,music ,licensing ,modernization,sec4 #aja4 ,short title4,sec4 #ajb4 ,blanket license for digital uses and mechanical licensing collective4,sec4 #ajc4 ,amendments to section #aad4,sec4 #ajd4 ,random assignment of rate court proceedings4,title ,,ii--,compensating ,legacy ,artists for their ,songs1 ,service1 and ,important ,contributions to ,society,sec4 #bja4 ,short title4,sec4 #bjb4 ,unauthorized digital performance of pre-#aigb sound recordings4,sec4 #bjc4 ,effective date4,title ,,iii--,allocation for ,music ,producers,sec4 #cja4 ,short title4,sec4 #cjb4 ,payment of statutory performance royalties4,sec4 #cjc4 ,effective date4 #b4 ,rescission of unobligated balances in the ,department of ,justice ,assets ,forfeiture ,fund ,of the unobligated balances available under the ,department of ,justice ,assets ,forfeiture ,fund1 #dg1jjj1jjj is hereby permanently rescinded4 ,i ,music ,licensing ,modernization #aja4 ,short title ,this title may be cited as the ,musical ,works ,modernization ,act4 #ajb4 ,blanket license for digital uses and mechanical licensing collective 7a7 ,amendment ,section #aae of title #ag1 ,united ,states ,code1 is amended-- 7#a7 in subsection 7a7-- 7,a7 by inserting in general after ,availability and scope of compulsory license2 7,b7 by striking paragraph 7#a7 and inserting the following new paragraph3 7#a7 ,eligibility for compulsory license 7,a7 ,conditions for compulsory license ,a person may by complying with the provisions of this section obtain a compulsory license to make and distribute phonorecords of a nondramatic musical work1 including by means of digital phonorecord delivery4 ,a person may obtain a compulsory license only if the primary purpose in making phonorecords of the musical work is to distribute them to the public for private use1 including by means of digital phonorecord delivery1 and-- 7i7 phonorecords of such musical work have previously been distributed to the public in the ,united ,states under the authority of the copyright owner of the work1 including by means of digital phonorecord delivery2 or 7ii7 in the case of a digital music provider seeking to make and distribute digital phonorecord deliveries of a sound recording embodying a musical work under a compulsory license for which clause 7i7 does not apply-- 7,i7 the first fixation of such sound recording was made under the authority of the musical work copyright owner1 and sound recording copyright owner has the authority of the musical work copyright owner to make and distribute digital phonorecord deliveries embodying such work to the public in the ,united ,states2 and 7,,ii7 the sound recording copyright owner or its authorized distributor has authorized the digital music provider to make and distribute digital phonorecord deliveries of the sound recording to the public in the ,united ,states4 7,b7 ,duplication of sound recording ,a person may not obtain a compulsory license for the use of the work in the making of phonorecords duplicating a sound recording fixed by another1 including by means of digital phonorecord delivery1 unless-- 7i7 such sound recording was fixed lawfully2 and 7ii7 the making of the phonorecords was authorized by the owner of the copyright in the sound recording or1 if the sound recording was fixed before ,february #ae1 #aigb1 by any person who fixed the sound recording pursuant to an express license from the owner of the copyright in the musical work or pursuant to a valid compulsory license for use of such work in a sound recording4 2 and 7,c7 in paragraph 7#b71 by striking ,a compulsory license and inserting ,musical arrangement4--,a compulsory license2 7#b7 by striking subsection 7b7 and inserting the following3 7b7 ,procedures ,to obtain a compulsory license 7#a7 ,phonorecords other than digital phonorecord deliveries ,a person who seeks to obtain a compulsory license under subsection 7a7 to make and distribute phonorecords of a musical work other than by means of digital phonorecord delivery shall1 before or within #cj calendar days after making1 and before distributing1 any phonorecord of the work1 serve notice of intention to do so on the copyright owner4 ,if the registration or other public records of the ,copyright ,office do not identify the copyright owner and include an address at which notice can be served1 it shall be sufficient to file the notice of intention with the ,copyright ,office4 ,the notice shall comply1 in form1 content1 and manner of service1 with requirements that the ,register of ,copyrights shall prescribe by regulation4 7#b7 ,digital phonorecord deliveries ,a person who seeks to obtain a compulsory license under subsection 7a7 to make and distribute phonorecords of a musical work by means of digital phonorecord delivery-- 7,a7 prior to the license availability date1 shall1 before or within #cj calendar days after first making any such digital phonorecord delivery1 serve a notice of intention to do so on the copyright owner 7but may not file the notice with the ,copyright ,office1 even if the public records of the ,office do not identify the owner or the owner's address71 and such notice shall comply1 in form1 content1 and manner of service1 with requirements that the ,register of ,copyrights shall prescribe by regulation2 or 7,b7 on or after the license availability date1 shall1 before making any such digital phonorecord delivery1 follow the procedure described in subsection 7d77#b71 except as provided in paragraph 7#c74 7#c7 ,record company individual download licenses ,notwithstanding paragraph 7#b77;,b71 a record company may1 on or after the license availability date1 obtain an individual download license in accordance with the notice requirements described in paragraph 7#b77;,a7 7except for the requirement that notice occur prior to the license availability date74 ,a record company that obtains an individual download license as permitted under this paragraph shall provide statements of account and pay royalties as provided in subsection 7c77#b77;,i74 7#d7 ,failure to obtain license 7,a7 ,phonorecords other than digital phonorecord deliveries ,in the case of phonorecords made and distributed other than by means of digital phonorecord delivery1 the failure to serve or file the notice of intention required by paragraph 7#a7 forecloses the possibility of a compulsory license under paragraph 7#a74 ,in the absence of a voluntary license1 the failure to obtain a compulsory license renders the making and distribution of phonorecords actionable as acts of infringement under section #eja and subject to the remedies provided by sections #ejb through #ejf4 7,b7 ,digital phonorecord deliveries 7i7 ,in the case of phonorecords made and distributed by means of digital phonorecord delivery3 7,i7 ,the failure to serve the notice of intention required by paragraph 7#b77;,a7 or paragraph 7#c71 as applicable1 forecloses the possibility of a compulsory license under such paragraph4 7,,ii7 ,the failure to comply with paragraph 7#b77;,b7 forecloses the possibility of a blanket license for a period of #c years after the last calendar day on which the notice of license was required to be submitted to the mechanical licensing collective under such paragraph4 7ii7 ,in either case described in clause 7i71 in the absence of a voluntary license1 the failure to obtain a compulsory license renders the making and distribution of phonorecords by means of digital phonorecord delivery actionable as acts of infringement under section #eja and subject to the remedies provided by sections #ejb through #ejf4 2 7#c7 by amending subsection 7c7 to read as follows3 7c7 ,general conditions applicable to compulsory license 7#a7 ,royalty payable under compulsory license 7,a7 ,identification requirement ,to be entitled to receive royalties under a compulsory license obtained under subsection 7b77#a7 the copyright owner must be identified in the registration or other public records of the ,copyright ,office4 ,the owner is entitled to royalties for phonorecords made and distributed after being so identified1 but is not entitled to recover for any phonorecords previously made and distributed4 7,b7 ,royalty for phonorecords other than digital phonorecord deliveries ,except as provided by subparagraph 7,a71 for every phonorecord made and distributed under a compulsory license under subsection 7a7 other than by means of digital phonorecord delivery1 with respect to each work embodied in the phonorecord1 the royalty shall be the royalty prescribed under subparagraphs 7,d7 through 7,f7 and paragraph 7#b77;,a7 and chapter #h of this title4 ,for purposes of this subparagraph1 a phonorecord is considered distributed if the person exercising the compulsory license has voluntarily and permanently parted with its possession4 7,c7 ,royalty for digital phonorecord deliveries ,for every digital phonorecord delivery of a musical work made under a compulsory license under this section1 the royalty payable shall be the royalty prescribed under subparagraphs 7,d7 through 7,f7 and paragraph 7#b77;,a7 and chapter #h of this title4 7,d7 ,authority to negotiate ,notwithstanding any provision of the antitrust laws1 any copyright owners of nondramatic musical works and any persons entitled to obtain a compulsory license under subsection 7a7 may negotiate and agree upon the terms and rates of royalty payments under this section and the proportionate division of fees paid among copyright owners1 and may designate common agents on a nonexclusive basis to negotiate1 agree to1 pay or receive such royalty payments4 ,such authority to negotiate the terms and rates of royalty payments includes1 but is not limited to1 the authority to negotiate the year during which the royalty rates prescribed under this subparagraph and subparagraphs 7,e7 and 7,f7 and paragraph 7#b77;,a7 and chapter #h of this title shall next be determined4 7,e7 ,determination of reasonable rates and terms ,proceedings under chapter #h shall determine reasonable rates and terms of royalty payments for the activities specified by this section during the period beginning with the effective date of such rates and terms1 but not earlier than ,january #a of the second year following the year in which the petition requesting the proceeding is filed1 and ending on the effective date of successor rates and terms1 or such other period as the parties may agree4 ,any copyright owners of nondramatic musical works and any persons entitled to obtain a compulsory license under subsection 7a7 may submit to the ,copyright ,royalty ,judges licenses covering such activities4 ,the parties to each proceeding shall bear their own costs4 7,f7 ,schedule of reasonable rates ,the schedule of reasonable rates and terms determined by the ,copyright ,royalty ,judges shall1 subject to paragraph 7#b77;,a71 be binding on all copyright owners of nondramatic musical works and persons entitled to obtain a compulsory license under subsection 7a7 during the period specified in subparagraph 7,e71 such other period as may be determined pursuant to subparagraphs 7,d7 and 7,e71 or such other period as the parties may agree4 ,the ,copyright ,royalty ,judges shall establish rates and terms that most clearly represent the rates and terms that would have been negotiated in the marketplace between a willing buyer and a willing seller4 ,in determining such rates and terms for digital phonorecord deliveries1 the ,copyright ,royalty ,judges shall base their decision on economic1 competitive1 and programming information presented by the parties1 including-- 7i7 whether use of the compulsory licensee's service may substitute for or may promote the sales of phonorecords or otherwise may interfere with or may enhance the musical work copyright owner's other streams of revenue from its musical works2 and 7ii7 the relative roles of the copyright owner and the compulsory licensee in the copyrighted work and the service made available to the public with respect to the relative creative contribution1 technological contribution1 capital investment1 cost1 and risk4 7#b7 ,additional terms and conditions 7,a7 ,voluntary licenses and contractual royalty rates 7i7 ,license agreements voluntarily negotiated at any time between one or more copyright owners of nondramatic musical works and one or more persons entitled to obtain a compulsory license under subsection 7a7 shall be given effect in lieu of any determination by the ,copyright ,royalty ,judges4 ,subject to clause 7ii71 the royalty rates determined pursuant to subparagraphs 7,e7 and 7,f7 of paragraph 7#a7 shall be given effect as to digital phonorecord deliveries in lieu of any contrary royalty rates specified in a contract pursuant to which a recording artist who is the author of a nondramatic musical work grants a license under that person's exclusive rights in the musical work under paragraphs 7#a7 and 7#c7 of section #ajf or commits another person to grant a license in that musical work under paragraphs 7#a7 and 7#c7 of section #ajf1 to a person desiring to fix in a tangible medium of expression a sound recording embodying the musical work4 7ii7 ,the second sentence of clause 7i7 shall not apply to-- 7,i7 a contract entered into on or before ,june #bb1 #aiie1 and not modified thereafter for the purpose of reducing the royalty rates determined pursuant to subparagraphs 7,e7 and 7,f7 of paragraph 7#a7 or of increasing the number of musical works within the scope of the contract covered by the reduced rates1 except if a contract entered into on or before ,june #bb1 #aiie1 is modified thereafter for the purpose of increasing the number of musical works within the scope of the contract1 any contrary royalty rates specified in the contract shall be given effect in lieu of royalty rates determined pursuant to subparagraphs 7,e7 and 7,f7 of paragraph 7#a7 for the number of musical works within the scope of the contract as of ,june #bb1 #aiie2 and 7,,ii7 a contract entered into after the date that the sound recording is fixed in a tangible medium of expression substantially in a form intended for commercial release1 if at the time the contract is entered into1 the recording artist retains the right to grant licenses as to the musical work under paragraphs 7#a7 and 7#c7 of section #ajf4 7,b7 ,sound recording information ,except as provided in section #ajjb7;e7 of this title1 a digital phonorecord delivery licensed under this paragraph shall be accompanied by the information encoded in the sound recording1 if any1 by or under the authority of the copyright owner of that sound recording1 that identifies the title of the sound recording1 the featured recording artist who performs on the sound recording1 and related information1 including information concerning the underlying musical work and its writer4 7,c7 ,infringement remedies 7i7 ,a digital phonorecord delivery of a sound recording is actionable as an act of infringement under section #eja1 and is fully subject to the remedies provided by sections #ejb through #ejf1 unless-- 7,i7 the digital phonorecord delivery has been authorized by the sound recording copyright owner2 and 7,,ii7 the entity making the digital phonorecord delivery has obtained a compulsory license under subsection 7a7 or has otherwise been authorized by the musical work copyright owner1 or by a record company pursuant to an individual download license1 to make and distribute phonorecords of each musical work embodied in the sound recording by means of digital phonorecord delivery4 7ii7 ,any cause of action under this subparagraph shall be in addition to those available to the owner of the copyright in the nondramatic musical work under subparagraph 7,j7 and section #ajf7d7 and the owner of the copyright in the sound recording under section #ajf7f74 7,d7 ,liability of sound recording owners ,the liability of the copyright owner of a sound recording for infringement of the copyright in a nondramatic musical work embodied in the sound recording shall be determined in accordance with applicable law1 except that the owner of a copyright in a sound recording shall not be liable for a digital phonorecord delivery by a third party if the owner of the copyright in the sound recording does not license the distribution of a phonorecord of the nondramatic musical work4 7,e7 ,recording devices and media ,nothing in section #ajjh shall be construed to prevent the exercise of the rights and remedies allowed by this paragraph1 subparagraph 7,j71 and chapter #e in the event of a digital phonorecord delivery1 except that no action alleging infringement of copyright may be brought under this title against a manufacturer1 importer or distributor of a digital audio recording device1 a digital audio recording medium1 an analog recording device1 or an analog recording medium1 or against a consumer1 based on the actions described in such section4 7,f7 ,preservation of rights ,nothing in this section annuls or limits 7i7 the exclusive right to publicly perform a sound recording or the musical work embodied therein1 including by means of a digital transmission1 under sections #ajf7d7 and #ajf7f71 7ii7 except for compulsory licensing under the conditions specified by this section1 the exclusive rights to reproduce and distribute the sound recording and the musical work embodied therein under sections #ajf7a7 and #ajf7c71 including by means of a digital phonorecord delivery1 or 7iii7 any other rights under any other provision of section #ajf1 or remedies available under this title1 as such rights or remedies exist either before or after the date of enactment of the ,digital ,performance ,right in ,sound ,recordings ,act of #aiie4 7,g7 ,exempt transmissions and retransmissions ,the provisions of this section concerning digital phonorecord deliveries shall not apply to any exempt transmissions or retransmissions under section #aad7;d77#a74 ,the exemptions created in section #aad7;d77#a7 do not expand or reduce the rights of copyright owners under section #ajf7a7 through 7#e7 with respect to such transmissions and retransmissions4 7,h7 ,distribution by rental1 lease1 or lending ,a compulsory license obtained under subsection 7b77#a7 to make and distribute phonorecords includes the right of the maker of such a phonorecord to distribute or authorize distribution of such phonorecord1 other than by means of a digital phonorecord delivery1 by rental1 lease1 or lending 7or by acts or practices in the nature of rental1 lease1 or lending74 ,with respect to each nondramatic musical work embodied in the phonorecord1 the royalty shall be a proportion of the revenue received by the compulsory licensee from every such act of distribution of the phonorecord under this clause equal to the proportion of the revenue received by the compulsory licensee from distribution of the phonorecord under subsection 7a77#a77;,a77ii77,,ii7 that is payable by a compulsory licensee under that clause and under chapter #h4 ,the ,register of ,copyrights shall issue regulations to carry out the purpose of this clause4 7,i7 ,payment of royalties and statements of account ,except as provided in paragraphs 7#d77;,a77i7 and 7#aj77;,b7 of subsection 7d71 royalty payments shall be made on or before the twentieth day of each month and shall include all royalties for the month next preceding4 ,each monthly payment shall be made under oath and shall comply with requirements that the ,register of ,copyrights shall prescribe by regulation4 ,the ,register shall also prescribe regulations under which detailed cumulative annual statements of account1 certified by a certified public accountant1 shall be filed for every compulsory license under subsection 7a74 ,the regulations covering both the monthly and the annual statements of account shall prescribe the form1 content1 and manner of certification with respect to the number of records made and the number of records distributed4 7,j7 ,notice of default and termination of compulsory license ,in the case of a license obtained under subsection 7b77#a71 7b77#b77;,a71 or 7b77#c71 if the copyright owner does not receive the monthly payment and the monthly and annual statements of account when due1 the owner may give written notice to the licensee that1 unless the default is remedied within #cj days from the date of the notice1 the compulsory license will be automatically terminated4 ,such termination renders either the making or the distribution1 or both1 of all phonorecords for which the royalty has not been paid1 actionable as acts of infringement under section #eja and fully subject to the remedies provided by sections #ejb through #ejf4 ,in the case of a license obtained under subsection 7b77#b77;,b71 license authority under the compulsory license may be terminated as provided in subsection 7d77#d77;,e74 2 7#d7 by amending subsection 7d7 to read as follows3 7d7 ,blanket license for digital uses1 mechanical licensing collective1 and digital licensee coordinator 7#a7 ,blanket license for digital uses 7,a7 ,in general ,a digital music provider that qualifies for a compulsory license under subsection 7a7 may1 by complying with the terms and conditions of this subsection1 obtain a blanket license from copyright owners through the mechanical licensing collective to make and distribute digital phonorecord deliveries of musical works through one or more covered activities4 7,b7 ,included activities ,a blanket license-- 7i7 covers all musical works 7or shares of such works7 available for compulsory licensing under this section for purposes of engaging in covered activities1 except as provided in subparagraph 7,c72 7ii7 includes the making and distribution of server1 intermediate1 archival1 and incidental reproductions of musical works that are reasonable and necessary for the digital music provider to engage in covered activities licensed under this subsection1 solely for the purpose of engaging in such covered activities2 and 7iii7 does not cover or include any rights or uses other than those described in clauses 7i7 and 7ii74 7,c7 ,other licenses ,a voluntary license for covered activities entered into by or under the authority of one or more copyright owners and one or more digital music providers1 or authority to make and distribute permanent downloads of a musical work obtained by a digital music provider from a sound recording copyright owner pursuant to an individual download license1 shall be given effect in lieu of a blanket license under this subsection with respect to the musical works 7or shares thereof7 covered by such voluntary license or individual download authority and the following conditions apply3 7i7 ,where a voluntary license or individual download license applies1 the license authority provided under the blanket license shall exclude any musical works 7or shares thereof7 subject to the voluntary license or individual download license4 7ii7 ,an entity engaged in covered activities under a voluntary license or authority obtained pursuant to an individual download license that is a significant nonblanket licensee shall comply with paragraph 7#f77;,a74 7iii7 ,the rates and terms of any voluntary license shall be subject to the second sentence of clause 7i7 and clause 7ii7 of subsection 7c77#b77;,a7 and paragraph 7#i77;,c71 as applicable4 7,d7 ,protection against infringement actions ,a digital music provider that obtains and complies with the terms of a valid blanket license under this subsection shall not be subject to an action for infringement of the exclusive rights provided by paragraphs 7#a7 and 7#c7 of section #ajf under this title arising from use of a musical work 7or share thereof7 to engage in covered activities authorized by such license1 subject to paragraph 7#d77;,e74 7,e7 ,other requirements and conditions apply ,except as expressly provided in this subsection1 each requirement1 limitation1 condition1 privilege1 right1 and remedy otherwise applicable to compulsory licenses under this section shall apply to compulsory blanket licenses under this subsection4 7#b7 ,availability of blanket license 7,a7 ,procedure for obtaining license ,a digital music provider may obtain a blanket license by submitting a notice of license to the mechanical licensing collective that specifies the particular covered activities in which the digital music provider seeks to engage1 as follows3 7i7 ,the notice of license shall comply in form and substance with requirements that the ,register of ,copyrights shall establish by regulation4 7ii7 ,unless rejected in writing by the mechanical licensing collective within #cj calendar days after receipt1 the blanket license shall be effective as of the date the notice of license was sent by the digital music provider as shown by a physical or electronic record4 7iii7 ,a notice of license may only be rejected by the mechanical licensing collective if-- 7,i7 the digital music provider or notice of license does not meet the requirements of this section or applicable regulations1 in which case the requirements at issue shall be specified with reasonable particularity in the notice of rejection2 or 7,,ii7 the digital music provider has had a blanket license terminated by the mechanical licensing collective within the past #c years pursuant to paragraph 7#d77;,e74 7iv7 ,if a notice of license is rejected under clause 7iii77,i71 the digital music provider shall have #cj calendar days after receipt of the notice of rejection to cure any deficiency and submit an amended notice of license to the mechanical licensing collective4 ,if the deficiency has been cured1 the mechanical licensing collective shall so confirm in writing1 and the license shall be effective as of the date that the original notice of license was provided by the digital music provider4 7v7 ,a digital music provider that believes a notice of license was improperly rejected by the mechanical licensing collective may seek review of such rejection in ,federal district court4 ,the district court shall determine the matter de novo based on the record before the mechanical licensing collective and any additional evidence presented by the parties4 7,b7 ,blanket license effective date ,blanket licenses shall be made available by the mechanical licensing collective on and after the license availability date4 ,no such license shall be effective prior to the license availability date4 7#c7 ,mechanical licensing collective 7,a7 ,in general ,the mechanical licensing collective shall be a single entity that-- 7i7 is a nonprofit1 not owned by any other entity1 that is created by copyright owners to carry out responsibilities under this subsection2 7ii7 is endorsed by and enjoys substantial support from musical work copyright owners that together represent the greatest percentage of the licensor market for uses of such works in covered activities1 as measured over the preceding #c full calendar years2 7iii7 is able to demonstrate to the ,register of ,copyrights that it has1 or will have prior to the license availability date1 the administrative and technological capabilities to perform the required functions of the mechanical licensing collective under this subsection2 and 7iv7 has been designated by the ,register of ,copyrights in accordance with subparagraph 7,b74 7,b7 ,designation of mechanical licensing collective 7i7 ,initial designation ,the ,register of ,copyrights shall initially designate the mechanical licensing collective within #i months after the enactment date as follows3 7,i7 ,within #ij calendar days after the enactment date1 the ,register shall publish notice in the ,federal ,register soliciting information to assist in identifying the appropriate entity to serve as the mechanical licensing collective1 including the name and affiliation of each member of the board of directors described under subparagraph 7,d77i7 and each committee established pursuant to clauses 7iii71 7iv71 and 7v7 of subparagraph 7,d74 7,,ii7 ,after reviewing the information requested under subclause 7,i7 and making a designation1 the ,register shall publish notice in the ,federal ,register setting forth the identity of and contact information for the mechanical licensing collective4 7ii7 ,periodic review of designation ,following the initial designation of the mechanical licensing collective1 the ,register shall1 every #e years1 beginning with the fifth full calendar year to commence after the initial designation1 publish notice in the ,federal ,register in the month of ,january soliciting information concerning whether the existing designation should be continued1 or a different entity meeting the criteria described in clauses 7i7 through 7iii7 of subparagraph 7,a7 shall be designated4 ,following publication of such notice3 7,i7 ,the ,register shall1 after reviewing the information submitted and conducting additional proceedings as appropriate1 publish notice in the ,federal ,register of a continuing designation or new designation of the mechanical licensing collective1 as the case may be1 with any new designation to be effective as of the first day of a month that is no less than #f months and no longer than #i months after the date of publication of such notice1 as specified by the ,register4 7,,ii7 ,if a new entity is designated as a mechanical licensing collective1 the ,register shall adopt regulations to govern the transfer of licenses1 funds1 records1 data1 and administrative responsibilities from the existing mechanical licensing collective to the new entity4 7iii7 ,closest alternative designation ,if the ,register is unable to identify an entity that fulfills each of the qualifications set forth in clauses 7i7 through 7iii7 of subparagraph 7,a71 the ,register shall designate the entity that most nearly fulfills such qualifications for purposes of carrying out the responsibilities of the mechanical licensing collective4 7,c7 ,authorities and functions 7i7 ,in general ,the mechanical licensing collective is authorized to perform the following functions1 subject to more particular requirements as described in this subsection3 7,i7 ,offer and administer blanket licenses1 including receipt of notices of license and reports of usage from digital music providers4 7,,ii7 ,collect and distribute royalties from digital music providers for covered activities4 7,,iii7 ,engage in efforts to identify musical works 7and shares of such works7 embodied in particular sound recordings1 and to identify and locate the copyright owners of such musical works 7and shares of such works74 7,,iv7 ,maintain the musical works database and other information relevant to the administration of licensing activities under this section4 7,v7 ,administer a process by which copyright owners can claim ownership of musical works 7and shares of such works71 and a process by which royalties for works for which the owner is not identified or located are equitably distributed to known copyright owners4 7,,vi7 ,administer collections of the administrative assessment from digital music providers and significant nonblanket licensees1 including receipt of notices of nonblanket activity4 7,,vii7 ,invest in relevant resources1 and arrange for services of outside vendors and others1 to support its activities4 7,,viii7 ,engage in legal and other efforts to enforce rights and obligations under this subsection1 including by filing bankruptcy proofs of claims for amounts owed under licenses1 and acting in coordination with the digital licensee coordinator4 7,,ix7 ,initiate and participate in proceedings before the ,copyright ,royalty ,judges to establish the administrative assessment under this subsection4 7,x7 ,initiate and participate in proceedings before the ,copyright ,office with respect to activities under this subsection4 7,,xi7 ,gather and provide documentation for use in proceedings before the ,copyright ,royalty ,judges to set rates and terms under this section4 7,,xii7 ,maintain records of its activities and engage in and respond to audits described under this subsection4 7,,xiii7 ,engage in such other activities as may be necessary or appropriate to fulfill its responsibilities under this subsection4 7ii7 ,additional administrative activities ,subject to paragraph 7#aa77;,c7 and clause 7iii71 the mechanical licensing collective may also administer1 or assist in administering1 voluntary licenses issued by or individual download licenses obtained from copyright owners for uses of musical works1 for which the mechanical licensing collective shall charge reasonable fees for such services4 7iii7 ,restriction concerning public performance rights ,the mechanical licensing collective may1 pursuant to clause 7ii71 provide administration services with respect to voluntary licenses that include the right of public performance in musical works1 but may not itself negotiate or grant licenses for the right of public performance in musical works1 and may not be the exclusive or nonexclusive assignee or grantee of the right of public performance in musical works4 7iv7 ,restriction on lobbying ,the mechanical licensing collective may not engage in government lobbying activities1 but may engage in the activities described in subclauses 7,,ix71 7,x71 and 7,,xi7 of clause 7i74 7,d7 ,governance 7i7 ,board of directors ,the mechanical licensing collective shall have a board of directors consisting of #ad voting members and #c nonvoting members1 as follows3 7,i7 ,ten voting members shall be representatives of music publishers to which songwriters have assigned exclusive rights of reproduction and distribution of musical works with respect to covered activities and no such music publisher member may be owned by1 or under common control with1 any other board member4 7,,ii7 ,four voting members shall be professional songwriters who have retained and exercise exclusive rights of reproduction and distribution with respect to covered activities with respect to musical works they have authored4 7,,iii7 ,one nonvoting member shall be a representative of the nonprofit trade association of music publishers that represents the greatest percentage of the licensor market for uses of musical works in covered activities1 as measured over the preceding #c full calendar years4 7,,iv7 ,one nonvoting member shall be a representative of the digital licensee coordinator1 provided that a digital licensee coordinator has been designated pursuant to paragraph 7#e77;,b74 ,otherwise1 the nonvoting member shall be the nonprofit trade association of digital licensees that represents the greatest percentage of the licensee market for uses of musical works in covered activities1 as measured over the preceding #c full calendar years4 7,v7 ,one nonvoting member shall be a representative of a nationally recognized nonprofit trade association whose primary mission is advocacy on behalf of songwriters in the ,united ,states4 7ii7 ,board meetings ,the board of directors shall meet no less than two times per year and discuss matters pertinent to the operations1 including the mechanical licensing collective budget4 7iii7 ,operations advisory committee ,the board of directors of the mechanical licensing collective shall establish an operations advisory committee consisting of no fewer than six members to make recommendations to the board of directors concerning the operations of the mechanical licensing collective1 including the efficient investment in and deployment of information technology and data resources4 ,such committee shall have an equal number of members of the committee who are-- 7,i7 musical work copyright owners who are appointed by the board of directors of the mechanical licensing collective2 and 7,,ii7 representatives of digital music providers who are appointed by the digital licensee coordinator4 7iv7 ,unclaimed royalties oversight committee ,the board of directors of the mechanical licensing collective shall establish and appoint an unclaimed royalties oversight committee consisting of #aj members1 #e of which shall be musical work copyright owners and #e of which shall be professional songwriters whose works are used in covered activities4 7v7 ,dispute resolution committee ,the board of directors of the mechanical licensing collective shall establish and appoint a dispute resolution committee consisting of no fewer than six members1 which committee shall include an equal number of representatives of musical work copyright owners and professional songwriters4 7vi7 ,mechanical licensing collective annual report ,not later than ,june #cj of each year commencing after the license availability date1 the mechanical licensing collective shall post1 and make available online for a period of at least #c years1 an annual report that sets forth how the collective operates1 how royalties are collected and distributed1 and the collective total costs for the preceding calendar year4 ,at the time of posting1 a copy of the report shall be provided to the ,register of ,copyrights4 7,e7 ,musical works database 7i7 ,establishment and maintenance of database ,the mechanical licensing collective shall establish and maintain a database containing information relating to musical works 7and shares of such works7 and1 to the extent known1 the identity and location of the copyright owners of such works 7and shares thereof7 and the sound recordings in which the musical works are embodied4 ,in furtherance of maintaining such database1 the mechanical licensing collective shall engage in efforts to identify the musical works embodied in particular sound recordings1 as well as to identify and locate the copyright owners of such works 7and shares thereof71 and update such data as appropriate4 7ii7 ,matched works ,with respect to musical works 7and shares thereof7 that have been matched to copyright owners1 the musical works database shall include-- 7,i7 the title of the musical work2 7,,ii7 the copyright owner of the work 7or share thereof71 and such owner's ownership percentage2 7,,iii7 contact information for such copyright owner2 7,,iv7 to the extent reasonably available to the mechanical licensing collective-- 7aa7 the international standard musical work code for the work2 and 7bb7 identifying information for sound recordings in which the musical work is embodied1 including the name of the sound recording1 featured artist1 sound recording copyright owner1 producer1 international standard recording code1 and other information commonly used to assist in associating sound recordings with musical works2 and 7,v7 such other information as the ,register of ,copyrights may prescribe by regulation4 7iii7 ,unmatched works ,with respect to unmatched musical works 7and shares of works7 in the database1 the musical works database shall include-- 7,i7 to the extent reasonably available to the mechanical licensing collective-- 7aa7 the title of the musical work2 7bb7 the ownership percentage for which an owner has not been identified2 7cc7 if a copyright owner has been identified but not located1 the identity of such owner and such owner's ownership percentage2 7dd7 identifying information for sound recordings in which the work is embodied1 including sound recording name1 featured artist1 sound recording copyright owner1 producer1 international standard recording code1 and other information commonly used to assist in associating sound recordings with musical works2 and 7ee7 any additional information reported to the mechanical licensing collective that may assist in identifying the work2 and 7,,ii7 such other information relating to the identity and ownership of musical works 7and shares of such works7 as the ,register of ,copyrights may prescribe by regulation4 7iv7 ,sound recording information ,each musical work copyright owner with any musical work listed in the musical works database shall engage in commercially reasonable efforts to deliver to the mechanical licensing collective1 including for use in the musical works database1 to the extent such information is not then available in the database1 information regarding the names of the sound recordings in which that copyright owner's musical works 7or shares thereof7 are embodied1 to the extent practicable4 7v7 ,accessibility of database ,the musical works database shall be made available to members of the public in a searchable1 online format1 free of charge4 ,the mechanical licensing collective shall make such database available in a bulk1 machine-readable format1 through a widely available software application1 to the following entities3 7,i7 ,digital music providers operating under the authority of valid notices of license1 free of charge4 7,,ii7 ,significant nonblanket licensees in compliance with their obligations under paragraph 7#f71 free of charge4 7,,iii7 ,authorized vendors of the entities described in subclauses 7,i7 and 7,,ii71 free of charge4 7,,iv7 ,the ,register of ,copyrights1 free of charge 7but the ,register shall not treat such database or any information therein as a ,government record74 7,v7 ,any member of the public1 for a fee not to exceed the marginal cost to the mechanical licensing collective of providing the database to such person4 7vi7 ,additional requirements ,the ,register of ,copyrights shall establish requirements by regulations to ensure the usability1 interoperability1 and usage restrictions of the musical works database4 7,f7 ,notices of license and nonblanket activity 7i7 ,notices of licenses ,the mechanical licensing collective shall receive1 review1 and confirm or reject notices of license from digital music providers1 as provided in paragraph 7#b77;,a74 ,the collective shall maintain a current1 publicly accessible list of blanket licenses that includes contact information for the licensees and the effective dates of such licenses4 7ii7 ,notices of nonblanket activity ,the mechanical licensing collective shall receive notices of nonblanket activity from significant nonblanket licensees1 as provided in paragraph 7#f77;,a74 ,the collective shall maintain a current1 publicly accessible list of notices of nonblanket activity that includes contact information for significant nonblanket licensees and the dates of receipt of such notices4 7,g7 ,collection and distribution of royalties 7i7 ,in general ,upon receiving reports of usage and payments of royalties from digital music providers for covered activities1 the mechanical licensing collective shall-- 7,i7 engage in efforts to-- 7aa7 identify the musical works embodied in sound recordings reflected in such reports1 and the copyright owners of such musical works 7and shares thereof72 7bb7 confirm uses of musical works subject to voluntary licenses and individual download licenses1 and the corresponding pro rata amounts to be deducted from royalties that would otherwise be due under the blanket license2 and 7cc7 confirm proper payment of royalties due2 7,,ii7 distribute royalties to copyright owners in accordance with the usage and other information contained in such reports1 as well as the ownership and other information contained in the records of the collective2 and 7,,iii7 deposit into an interest-bearing account1 as provided in subparagraph 7,h77ii71 royalties that cannot be distributed due to-- 7aa7 an inability to identify or locate a copyright owner of a musical work 7or share thereof72 or 7bb7 a pending dispute before the dispute resolution committee of the mechanical licensing collective4 7ii7 ,other collection efforts ,any royalties recovered by the mechanical licensing collective as a result of efforts to enforce rights or obligations under a blanket license1 including through a bankruptcy proceeding or other legal action1 shall be distributed to copyright owners based on available usage information and in accordance with the procedures described in subclauses 7,i7 and 7,,ii7 of clause 7i71 on a pro rata basis in proportion to the overall percentage recovery of the total royalties owed1 with any pro rata share of royalties that cannot be distributed deposited in an interest-bearing account as provided in subparagraph 7,h77ii74 7,h7 ,holding of accrued royalties 7i7 ,holding period ,the mechanical licensing collective shall hold accrued royalties associated with particular musical works 7and shares of works7 that remain unmatched for a period of at least #c years after the date on which the funds were received by the mechanical licensing collective1 or at least #c years after the date on which they were accrued by a digital music provider that subsequently transferred such funds to the mechanical licensing collective pursuant to paragraph 7#aj77;,b71 whichever period expires sooner4 7ii7 ,interest-bearing account ,accrued royalties for unmatched works 7and shares thereof7 shall be maintained by the mechanical licensing collective in an interest-bearing account that earns monthly interest at the ,federal1 short-term rate1 such interest to accrue for the benefit of copyright owners entitled to payment of such accrued royalties4 7,i7 ,musical works claiming process ,the mechanical licensing collective shall publicize the existence of accrued royalties for unmatched musical works 7and shares of such works7 within #f months of receiving a transfer of accrued royalties for such works by publicly listing the works and the procedures by which copyright owners may identify themselves and provide ownership1 contact1 and other relevant information to the mechanical licensing collective in order to receive payment of accrued royalties4 ,when a copyright owner of an unmatched work 7or share of a work7 has been identified and located in accordance with the procedures of the mechanical licensing collective1 the collective shall-- 7i7 update the musical works database and its other records accordingly2 and 7ii7 provided that accrued royalties for the musical work 7or share thereof7 have not yet been included in a distribution pursuant to subparagraph 7,j77i71 pay such accrued royalties and a proportionate amount of accrued interest associated with that work 7or share thereof7 to the copyright owner1 accompanied by a cumulative statement of account reflecting usage of such work and accrued royalties based on information provided by digital music providers to the mechanical licensing collective4 7,j7 ,distribution of unclaimed accrued royalties 7i7 ,distribution procedures ,after the expiration of the prescribed holding period for accrued royalties provided in paragraph 7,h77i71 the mechanical licensing collective shall distribute such accrued royalties1 along with a proportionate share of accrued interest1 to copyright owners identified in the records of the collective1 subject to the following requirements1 and in accordance with the policies and procedures established under clause 7ii73 7,i7 ,the first such distribution shall occur on or after ,july #a of the first full calendar year to commence after the license availability date1 with at least one such distribution to take place during each calendar year thereafter4 7,,ii7 ,copyright owners' payment shares for unclaimed accrued royalties for particular reporting periods shall be determined in a transparent and equitable manner based on data indicating the relative market shares of such copyright owners as reflected by royalty payments made by digital music providers for covered activities for the periods in question1 including1 in addition to royalty payments made to the mechanical licensing collective1 royalty payments made to copyright owners under voluntary licenses and individual download licenses for covered activities1 to the extent such information is available to the mechanical licensing collective4 ,in furtherance of the determination of equitable market shares under this subparagraph-- 7aa7 the mechanical licensing collective may require copyright owners seeking distributions of unclaimed accrued royalties to provide1 or direct the provision of1 information concerning royalties received under voluntary licenses and individual download licenses for covered activities2 and 7bb7 the mechanical licensing collective shall take appropriate steps to safeguard the confidentiality and security of financial and other sensitive data used to compute market shares in accordance with the confidentiality provisions prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c74 7ii7 ,establishment of distribution policies ,the unclaimed royalties oversight committee established under paragraph 7#c77;,d77iv7 shall establish policies and procedures for the distribution of unclaimed accrued royalties and accrued interest in accordance with this subparagraph1 including the provision of usage data to copyright owners to allocate payments and credits to songwriters pursuant to clause 7iv71 subject to the approval of the board of directors of the mechanical licensing collective4 7iii7 ,advance notice of distributions ,the mechanical licensing collective shall publicize a pending distribution of unclaimed accrued royalties and accrued interest at least #ij calendar days in advance of such distribution4 7iv7 ,songwriter payments ,copyright owners that receive a distribution of unclaimed accrued royalties and accrued interest shall pay or credit a portion to songwriters 7or the authorized agents of songwriters7 on whose behalf the copyright owners license or administer musical works for covered activities1 in accordance with applicable contractual terms1 but notwithstanding any agreement to the contrary-- 7,i7 such payments and credits to songwriters shall be allocated in proportion to reported usage of individual musical works by digital music providers during the reporting periods covered by the distribution from the mechanical licensing collective2 and 7,,ii7 in no case shall the payment or credit to an individual songwriter be less than #ej percent of the payment received by the copyright owner attributable to usage of musical works 7or shares of works7 of that songwriter4 7,k7 ,dispute resolution ,the dispute resolution committee established under paragraph 7#c77;,d77v7 shall address and resolve in a timely and equitable manner disputes among copyright owners relating to ownership interests in musical works licensed under this section and allocation and distribution of royalties by the mechanical licensing collective1 according to a process approved by the board of directors of the mechanical licensing collective4 ,such process-- 7i7 shall include a mechanism to hold disputed funds in accordance with the requirements described in subparagraph 7,h77ii7 pending resolution of the dispute2 and 7ii7 except as provided in paragraph 7#aa77;,d71 shall not affect any legal or equitable rights or remedies available to any copyright owner or songwriter concerning ownership of1 and entitlement to royalties for1 a musical work4 7,l7 ,verification of payments by mechanical licensing collective 7i7 ,verification process ,a copyright owner entitled to receive payments of royalties for covered activities from the mechanical licensing collective may1 individually or with other copyright owners1 conduct an audit of the mechanical licensing collective to verify the accuracy of royalty payments by the mechanical licensing collective to such copyright owner1 as follows3 7,i7 ,a copyright owner may audit the mechanical licensing collective only once in a year for any or all of the prior #c calendar years1 and may not audit records for any calendar year more than once4 7,,ii7 ,the audit shall be conducted by a qualified auditor1 who shall perform the audit during the ordinary course of business by examining the books1 records1 and data of the mechanical licensing collective1 according to generally accepted auditing standards and subject to applicable confidentiality requirements prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c74 7,,iii7 ,the mechanical licensing collective shall make such books1 records1 and data available to the qualified auditor and respond to reasonable requests for relevant information1 and shall use commercially reasonable efforts to facilitate access to relevant information maintained by third parties4 7,,iv7 ,to commence the audit1 any copyright owner shall file with the ,copyright ,office a notice of intent to conduct an audit of the mechanical licensing collective1 identifying the period of time to be audited1 and shall simultaneously deliver a copy of such notice to the mechanical licensing collective4 ,the ,register of ,copyrights shall cause the notice of audit to be published in the ,federal ,register within #de calendar days after receipt4 7,v7 ,the qualified auditor shall determine the accuracy of royalty payments1 including whether an underpayment or overpayment of royalties was made by the mechanical licensing collective to each auditing copyright owner1 but before providing a final audit report to any such copyright owner1 the qualified auditor shall provide a tentative draft of the report to the mechanical licensing collective and allow the mechanical licensing collective a reasonable opportunity to respond to the findings1 including by clarifying issues and correcting factual errors4 7,,vi7 ,the auditing copyright owner or owners shall bear the cost of the audit4 ,in case of an underpayment to any copyright owner1 the mechanical licensing collective shall pay the amounts of any such underpayment to such auditing copyright owner1 as appropriate4 ,in case of an overpayment by the mechanical licensing collective1 the mechanical licensing collective may debit the account of the auditing copyright owner or owners for such overpaid amounts1 or such owner7s7 shall refund overpaid amounts to the mechanical licensing collective1 as appropriate4 7ii7 ,alternative verification procedures ,nothing in this subparagraph shall preclude a copyright owner and the mechanical licensing collective from agreeing to audit procedures different from those described herein1 but a notice of the audit shall be provided to and published by the ,copyright ,office as described in clause 7i77,,iv74 7,m7 ,records of mechanical licensing collective 7i7 ,records maintenance ,the mechanical licensing collective shall ensure that all material records of its operations1 including those relating to notices of license1 the administration of its claims process1 reports of usage1 royalty payments1 receipt and maintenance of accrued royalties1 royalty distribution processes1 and legal matters1 are preserved and maintained in a secure and reliable manner1 with appropriate commercially reasonable safeguards against unauthorized access1 copying1 and disclosure1 and subject to the confidentiality requirements prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c7 for a period of no less than #g years after the date of creation or receipt1 whichever occurs later4 7ii7 ,records access ,the mechanical licensing collective shall provide prompt access to electronic and other records pertaining to the administration of a copyright owner's musical works upon reasonable written request of such owner or the owner's authorized representative4 7#d7 ,terms and conditions of blanket license ,a blanket license is subject to1 and conditioned upon1 the following requirements3 7,a7 ,royalty reporting and payments 7i7 ,monthly reports and payment ,a digital music provider shall report and pay royalties to the mechanical licensing collective under the blanket license on a monthly basis in accordance with clause 7ii7 and subsection 7c77#b77;,i71 but the monthly reporting shall be due #de calendar days1 rather than #bj calendar days1 after the end of the monthly reporting period4 7ii7 ,data to be reported ,in reporting usage of musical works to the mechanical licensing collective1 a digital music provider shall provide usage data for musical works used under the blanket license and usage data for musical works used in covered activities under voluntary licenses and individual download licenses4 ,in the report of usage1 the digital music provider shall-- 7,i7 with respect to each sound recording embodying a musical work-- 7aa7 provide identifying information for the sound recording1 including sound recording name1 featured artist and1 to the extent acquired by the digital music provider in connection with its use of sound recordings of musical works to engage in covered activities1 including pursuant to subparagraph 7,b71 producer1 international standard recording code1 and other information commonly used in the industry to identify sound recordings and match them to the musical works the sound recordings embody2 7bb7 to the extent acquired by the digital music provider in the metadata in connection with its use of sound recordings of musical works to engage in covered activities1 including pursuant to subparagraph 7,b71 provide information concerning authorship and ownership of the applicable rights in the musical work embodied in the sound recording 7including each songwriter1 publisher name1 and respective ownership share7 and the international standard musical work code2 and 7cc7 provide the number of digital phonorecord deliveries of the sound recording1 including limited downloads and interactive streams2 7,,ii7 identify and provide contact information for all musical work copyright owners for works embodied in sound recordings as to which a voluntary license1 rather than the blanket license1 is in effect with respect to the uses being reported2 and 7,,iii7 provide such other information as the ,register of ,copyrights shall require by regulation4 7iii7 ,format and maintenance of reports ,reports of usage provided by digital music providers to the mechanical licensing collective shall be in a machine-readable format that is compatible with the information technology systems of the mechanical licensing collective and meets the requirements of regulations adopted by the ,register of ,copyrights4 ,the ,register shall also adopt regulations setting forth requirements under which records of use shall be maintained and made available to the mechanical licensing collective by digital music providers engaged in covered activities under a blanket license4 7iv7 ,adoption of regulations ,the ,register shall adopt regulations-- 7,i7 setting forth requirements under which records of use shall be maintained and made available to the mechanical licensing collective by digital music providers engaged in covered activities under a blanket license2 and 7,,ii7 regarding adjustments to reports of usage by digital music providers1 including mechanisms to account for overpayment and underpayment of royalties in prior periods4 7,b7 ,collection of sound recording information ,a digital music provider shall engage in good-faith1 commercially reasonable efforts to obtain from copyright owners of sound recordings made available through the service of such digital music provider-- 7i7 sound recording copyright owners1 producers1 international standard recording codes1 and other information commonly used in the industry to identify sound recordings and match them to the musical works the sound recordings embody2 and 7ii7 information concerning the authorship and ownership of musical works1 including songwriters1 publisher names1 ownership shares1 and international standard musical work codes4 7,c7 ,payment of administrative assessment ,a digital music provider and any significant nonblanket licensee shall pay the administrative assessment established under paragraph 7#g77;,d7 in accordance with this subsection and applicable regulations4 7,d7 ,verification of payments by digital music providers 7i7 ,verification process ,the mechanical licensing collective may conduct an audit of a digital music provider operating under the blanket license to verify the accuracy of royalty payments by the digital music provider to the mechanical licensing collective as follows3 7,i7 ,the mechanical licensing collective may commence an audit of a digital music provider no more than once in any #c-;calendar-year period to cover a verification period of no more than the #c full calendar years preceding the date of commencement of the audit1 and such audit may not audit records for any such #c-year verification period more than once4 7,,ii7 ,the audit shall be conducted by a qualified auditor1 who shall perform the audit during the ordinary course of business by examining the books1 records1 and data of the digital music provider1 according to generally accepted auditing standards and subject to applicable confidentiality requirements prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c74 7,,iii7 ,the digital music provider shall make such books1 records1 and data available to the qualified auditor and respond to reasonable requests for relevant information1 and shall use commercially reasonable efforts to provide access to relevant information maintained with respect to a digital music provider by third parties4 7,,iv7 ,to commence the audit1 the mechanical licensing collective shall file with the ,copyright ,office a notice of intent to conduct an audit of the digital music provider1 identifying the period of time to be audited1 and shall simultaneously deliver a copy of such notice to the digital music provider4 ,the ,register of ,copyrights shall cause the notice of audit to be published in the ,federal ,register within #de calendar days after receipt4 7,v7 ,the qualified auditor shall determine the accuracy of royalty payments1 including whether an underpayment or overpayment of royalties was made by the digital music provider to the mechanical licensing collective1 but before providing a final audit report to the mechanical licensing collective1 the qualified auditor shall provide a tentative draft of the report to the digital music provider and allow the digital music provider a reasonable opportunity to respond to the findings1 including by clarifying issues and correcting factual errors4 7,,vi7 ,the mechanical licensing collective shall pay the cost of the audit1 unless the qualified auditor determines that there was an underpayment by the digital music provider of #aj percent or more1 in which case the digital music provider shall bear the reasonable costs of the audit1 in addition to paying the amount of any underpayment to the mechanical licensing collective4 ,in case of an overpayment by the digital music provider1 the mechanical licensing collective shall provide a credit to the account of the digital music provider4 7,,vii7 ,a digital music provider may not assert section #ejg or any other ,federal or ,state statute of limitations1 doctrine of laches or estoppel1 or similar provision as a defense to a legal action arising from an audit under this subparagraph if such legal action is commenced no more than #f years after the commencement of the audit that is the basis for such action4 7ii7 ,alternative verification procedures ,nothing in this subparagraph shall preclude the mechanical licensing collective and a digital music provider from agreeing to audit procedures different from those described herein1 but a notice of the audit shall be provided to and published by the ,copyright ,office as described in clause 7i77,,iv74 7,e7 ,default under blanket license 7i7 ,conditions of default ,a digital music provider shall be in default under a blanket license if the digital music provider-- 7,i7 fails to provide one or more monthly reports of usage to the mechanical licensing collective when due2 7,,ii7 fails to make a monthly royalty or late fee payment to the mechanical licensing collective when due1 in all or material part2 7,,iii7 provides one or more monthly reports of usage to the mechanical licensing collective that1 on the whole1 is or are materially deficient as a result of inaccurate1 missing1 or unreadable data1 where the correct data was available to the digital music provider and required to be reported under this section and applicable regulations2 7,,iv7 fails to pay the administrative assessment as required under this subsection and applicable regulations2 or 7,v7 after being provided written notice by the mechanical licensing collective1 refuses to comply with any other material term or condition of the blanket license under this section for a period of #fj calendar days or longer4 7ii7 ,notice of default and termination ,in case of a default by a digital music provider1 the mechanical licensing collective may proceed to terminate the blanket license of the digital music provider as follows3 7,i7 ,the mechanical licensing collective shall provide written notice to the digital music provider describing with reasonable particularity the default and advising that unless such default is cured within #fj calendar days after the date of the notice1 the blanket license will automatically terminate at the end of that period4 7,,ii7 ,if the digital music provider fails to remedy the default within the #fj-;day period referenced in subclause 7,i71 the license shall terminate without any further action on the part of the mechanical licensing collective4 ,such termination renders the making of all digital phonorecord deliveries of all musical works 7and shares thereof7 covered by the blanket license for which the royalty or administrative assessment has not been paid actionable as acts of infringement under section #eja and subject to the remedies provided by sections #ejb through #ejf4 7iii7 ,notice to copyright owners ,the mechanical licensing collective shall provide written notice of any termination under this subparagraph to copyright owners of affected works4 7iv7 ,review by ,federal district court ,a digital music provider that believes a blanket license was improperly terminated by the mechanical licensing collective may seek review of such termination in ,federal district court4 ,the district court shall determine the matter de novo based on the record before the mechanical licensing collective and any additional supporting evidence presented by the parties4 7#e7 ,digital licensee coordinator 7,a7 ,in general ,the digital licensee coordinator shall be a single entity that-- 7i7 is a nonprofit1 not owned by any other entity1 that is created to carry out responsibilities under this subsection2 7ii7 is endorsed by and enjoys substantial support from digital music providers and significant nonblanket licensees that together represent the greatest percentage of the licensee market for uses of musical works in covered activities1 as measured over the preceding #c calendar years2 7iii7 is able to demonstrate that it has1 or will have prior to the license availability date1 the administrative capabilities to perform the required functions of the digital licensee coordinator under this subsection2 and 7iv7 has been designated by the ,register of ,copyrights in accordance with subparagraph 7,b74 7,b7 ,designation of digital licensee coordinator 7i7 ,initial designation ,the ,register of ,copyrights shall initially designate the digital licensee coordinator within #i months after the enactment date1 in accordance with the same procedure described for designation of the mechanical licensing collective in paragraph 7#c77;,b77i74 7ii7 ,periodic review of designation ,following the initial designation of the digital licensee coordinator1 the ,register shall1 every #e years1 beginning with the fifth full calendar year to commence after the initial designation1 determine whether the existing designation should be continued1 or a different entity meeting the criteria described in clauses 7i7 through 7iii7 of subparagraph 7,a7 should be designated1 in accordance with the same procedure described for the mechanical licensing collective in paragraph 7#c77;,b77ii74 7iii7 ,inability to designate ,if the ,register is unable to identify an entity that fulfills each of the qualifications described in clauses 7i7 through 7iii7 of subparagraph 7,a7 to serve as the digital licensee coordinator1 the ,register may decline to designate a digital licensee coordinator4 ,the ,register's determination not to designate a digital licensee coordinator shall not negate or otherwise affect any provision of this subsection except to the limited extent that a provision references the digital licensee coordinator4 ,in such case1 the reference to the digital licensee coordinator shall be without effect unless and until a new digital licensee coordinator is designated4 7,c7 ,authorities and functions 7i7 ,in general ,the digital licensee coordinator is authorized to perform the following functions1 subject to more particular requirements as described in this subsection3 7,i7 ,establish a governance structure1 criteria for membership1 and any dues to be paid by its members4 7,,ii7 ,engage in efforts to enforce notice and payment obligations with respect to the administrative assessment1 including by receiving information from and coordinating with the mechanical licensing collective4 7,,iii7 ,initiate and participate in proceedings before the ,copyright ,royalty ,judges to establish the administrative assessment under this subsection4 7,,iv7 ,initiate and participate in proceedings before the ,copyright ,office with respect to activities under this subsection4 7,v7 ,gather and provide documentation for use in proceedings before the ,copyright ,royalty ,judges to set rates and terms under this section4 7,,vi7 ,maintain records of its activities4 7,,vii7 ,engage in such other activities as may be necessary or appropriate to fulfill its responsibilities under this subsection4 7ii7 ,restriction on lobbying ,the digital licensee coordinator may not engage in government lobbying activities1 but may engage in the activities described in subclauses 7,,iii71 7,,iv71 and 7,v7 of clause 7i74 7#f7 ,requirements for significant nonblanket licensees 7,a7 ,in general 7i7 ,notice of activity ,not later than #de calendar days after the license availability date1 or #de calendar days after the end of the first full calendar month in which an entity initially qualifies as a significant nonblanket licensee1 whichever occurs later1 a significant nonblanket licensee shall submit a notice of nonblanket activity to the mechanical licensing collective4 ,the notice of nonblanket activity shall comply in form and substance with requirements that the ,register of ,copyrights shall establish by regulation1 and a copy shall be made available to the digital licensee coordinator4 7ii7 ,reporting and payment obligations ,the notice of nonblanket activity submitted to the mechanical licensing collective shall be accompanied by a report of usage that contains the information described in paragraph 7#d77;,a77ii71 as well as any payment of the administrative assessment required under this subsection and applicable regulations4 ,thereafter1 subject to clause 7iii71 a significant nonblanket licensee shall continue to provide monthly reports of usage1 accompanied by any required payment of the administrative assessment1 to the mechanical licensing collective4 ,such reports and payments shall be submitted not later than #de calendar days after the end of the calendar month being reported4 7iii7 ,discontinuation of obligations ,an entity that has submitted a notice of nonblanket activity to the mechanical licensing collective that has ceased to qualify as a significant nonblanket licensee may so notify the collective in writing4 ,in such case1 as of the calendar month in which such notice is provided1 such entity shall no longer be required to provide reports of usage or pay the administrative assessment1 but if such entity later qualifies as a significant nonblanket licensee1 such entity shall again be required to comply with clauses 7i7 and 7ii74 7,b7 ,reporting by mechanical licensing collective to digital licensee coordinator 7i7 ,monthly reports of noncompliant licensees ,the mechanical licensing collective shall provide monthly reports to the digital licensee coordinator setting forth any significant nonblanket licensees of which the collective is aware that have failed to comply with subparagraph 7,a74 7ii7 ,treatment of confidential information ,the mechanical licensing collective and digital licensee coordinator shall take appropriate steps to safeguard the confidentiality and security of financial and other sensitive data shared under this subparagraph1 in accordance with the confidentiality requirements prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c74 7,c7 ,legal enforcement efforts 7i7 ,federal court action ,should the mechanical licensing collective or digital licensee coordinator become aware that a significant nonblanket licensee has failed to comply with subparagraph 7,a71 either may commence an action in ,federal district court for damages and injunctive relief4 ,if the significant nonblanket licensee is found liable1 the court shall1 absent a finding of excusable neglect1 award damages in an amount equal to three times the total amount of the unpaid administrative assessment and1 notwithstanding anything to the contrary in section #eje1 reasonable attorney's fees and costs1 as well as such other relief as the court deems appropriate4 ,in all other cases1 the court shall award relief as appropriate4 ,any recovery of damages shall be payable to the mechanical licensing collective as an offset to the collective total costs4 7ii7 ,statute of limitations for enforcement action ,any action described in this subparagraph shall be commenced within the time period described in section #ejg7;b74 7iii7 ,other rights and remedies preserved ,the ability of the mechanical licensing collective or digital licensee coordinator to bring an action under this subparagraph shall in no way alter1 limit or negate any other right or remedy that may be available to any party at law or in equity4 7#g7 ,funding of mechanical licensing collective 7,a7 ,in general ,the collective total costs shall be funded by-- 7i7 an administrative assessment1 as such assessment is established by the ,copyright ,royalty ,judges pursuant to subparagraph 7,d7 from time to time1 to be paid by-- 7,i7 digital music providers that are engaged1 in all or in part1 in covered activities pursuant to a blanket license2 and 7,,ii7 significant nonblanket licensees2 and 7ii7 voluntary contributions from digital music providers and significant nonblanket licensees as may be agreed with copyright owners4 7,b7 ,voluntary contributions 7i7 ,agreements concerning contributions ,except as provided in clause 7ii71 voluntary contributions by digital music providers and significant nonblanket licensees shall be determined by private negotiation and agreement1 and the following conditions apply3 7,i7 ,the date and amount of each voluntary contribution to the mechanical licensing collective shall be documented in a writing signed by an authorized agent of the mechanical licensing collective and the contributing party4 7,,ii7 ,such agreement shall be made available as required in proceedings before the ,copyright ,royalty ,judges to establish or adjust the administrative assessment in accordance with applicable statutory and regulatory provisions and rulings of the ,copyright ,royalty ,judges4 7ii7 ,treatment of contributions ,each such voluntary contribution shall be treated for purposes of an administrative assessment proceeding as an offset to the collective total costs that would otherwise be recovered through the administrative assessment4 ,any allocation or reallocation of voluntary contributions between or among individual digital music providers or significant nonblanket licensees shall be a matter of private negotiation and agreement among such parties and outside the scope of the administrative assessment proceeding4 7,c7 ,interim application of accrued royalties ,in the event that the administrative assessment1 together with any funding from voluntary contributions as provided in subparagraphs 7,a7 and 7,b71 is inadequate to cover current collective total costs1 the collective1 with approval of its board of directors1 may apply unclaimed accrued royalties on an interim basis to defray such costs1 subject to future reimbursement of such royalties from future collections of the assessment4 7,d7 ,determination of administrative assessment 7i7 ,administrative assessment to cover collective total costs ,the administrative assessment shall be used solely and exclusively to fund the collective total costs4 7ii7 ,separate proceeding before copyright royalty judges ,the amount and terms of the administrative assessment shall be determined and established in a separate and independent proceeding before the ,copyright ,royalty ,judges1 according to the procedures described in clauses 7iii7 and 7iv74 ,the administrative assessment determined in such proceeding shall-- 7,i7 be wholly independent of royalty rates and terms applicable to digital music providers1 which shall not be taken into consideration in any manner in establishing the administrative assessment2 7,,ii7 be established by the ,copyright ,royalty ,judges in an amount that is calculated to defray the reasonable collective total costs2 7,,iii7 be assessed based on usage of musical works by digital music providers and significant nonblanket licensees in covered activities under both compulsory and nonblanket licenses2 7,,iv7 may be in the form of a percentage of royalties payable under this section for usage of musical works in covered activities 7regardless of whether a different rate applies under a voluntary license71 or any other usage-based metric reasonably calculated to equitably allocate the collective total costs across digital music providers and significant nonblanket licensees engaged in covered activities1 but shall include as a component a minimum fee for all digital music providers and significant nonblanket licensees2 and 7,v7 take into consideration anticipated future collective total costs and collections of the administrative assessment1 but also1 as applicable-- 7aa7 any portion of past actual collective total costs of the mechanical licensing collective not funded by previous collections of the administrative assessment or voluntary contributions because such collections or contributions together were insufficient to fund such costs2 7bb7 any past collections of the administrative assessment and voluntary contributions that exceeded past actual collective total costs1 resulting in a surplus2 and 7cc7 the amount of any voluntary contributions by digital music providers or significant nonblanket licensees in relevant periods1 described in subparagraphs 7,a7 and 7,b7 of paragraph 7#g74 7iii7 ,initial administrative assessment ,the procedure for establishing the initial administrative assessment shall be as follows3 7,i7 ,the ,copyright ,royalty ,judges shall commence a proceeding to establish the initial administrative assessment within #i months after the enactment date by publishing a notice in the ,federal ,register seeking petitions to participate4 7,,ii7 ,the mechanical licensing collective and digital licensee coordinator shall participate in such proceeding1 along with any interested copyright owners1 digital music providers or significant nonblanket licensees that have notified the ,copyright ,royalty ,judges of their desire to participate4 7,,iii7 ,the ,copyright ,royalty ,judges shall establish a schedule for submission by the parties of information that may be relevant to establishing the administrative assessment1 including actual and anticipated collective total costs of the mechanical licensing collective1 actual and anticipated collections from digital music providers and significant nonblanket licensees1 and documentation of voluntary contributions1 as well as a schedule for further proceedings1 which shall include a hearing1 as they deem appropriate4 7,,iv7 ,the initial administrative assessment shall be determined1 and such determination shall be published in the ,federal ,register by the ,copyright ,royalty ,judges1 within #a year after commencement of the proceeding described in this clause4 ,the determination shall be supported by a written record4 ,the initial administrative assessment shall be effective as of the license availability date1 and shall continue in effect unless and until an adjusted administrative assessment is established pursuant to an adjustment proceeding under clause 7iii74 7iv7 ,adjustment of administrative assessment ,the administrative assessment may be adjusted by the ,copyright ,royalty ,judges periodically1 in accordance with the following procedures3 7,i7 ,no earlier than #a year after the most recent publication of a determination of the administrative assessment by the ,copyright ,royalty ,judges1 the mechanical licensing collective1 the digital licensee coordinator1 or one or more interested copyright owners1 digital music providers1 or significant nonblanket licensees1 may file a petition with the ,copyright ,royalty ,judges in the month of ,october to commence a proceeding to adjust the administrative assessment4 7,,ii7 ,notice of the commencement of such proceeding shall be published in the ,federal ,register in the month of ,november following the filing of any petition1 with a schedule of requested information and additional proceedings1 as described in clause 7iii77,,iii74 ,the mechanical licensing collective and digital licensee coordinator shall participate in such proceeding1 along with any interested copyright owners1 digital music providers1 or significant nonblanket licensees that have notified the ,copyright ,royalty ,judges of their desire to participate4 7,,iii7 ,the determination of the adjusted administrative assessment1 which shall be supported by a written record1 shall be published in the ,federal ,register during ,november of the calendar year following the commencement of the proceeding4 ,the adjusted administrative assessment shall take effect ,january #a of the year following such publication4 7v7 ,adoption of voluntary agreements ,in lieu of reaching their own determination based on evaluation of relevant data1 the ,copyright ,royalty ,judges shall approve and adopt a negotiated agreement to establish the amount and terms of the administrative assessment that has been agreed to by the mechanical licensing collective and the digital licensee coordinator 7or if none has been designated1 interested digital music providers and significant nonblanket licensees representing more than half of the market for uses of musical works in covered activities71 but the ,copyright ,royalty ,judges shall have the discretion to reject any such agreement for good cause shown4 ,an administrative assessment adopted under this clause shall apply to all digital music providers and significant nonblanket licensees engaged in covered activities during the period it is in effect4 7vi7 ,continuing authority to amend ,the ,copyright ,royalty ,judges shall retain continuing authority to amend a determination of an administrative assessment to correct technical or clerical errors1 or modify the terms of implementation1 for good cause1 with any such amendment to be published in the ,federal ,register4 7vii7 ,appeal of administrative assessment ,the determination of an administrative assessment by the ,copyright ,royalty ,judges shall be appealable1 within #cj calendar days after publication in the ,federal ,register1 to the ,court of ,appeals for the ,district of ,columbia ,circuit by any party that fully participated in the proceeding4 ,the administrative assessment as established by the ,copyright ,royalty ,judges shall remain in effect pending the final outcome of any such appeal1 and the mechanical licensing collective1 digital licensee coordinator1 digital music providers1 and significant nonblanket licensees shall implement appropriate financial or other measures within #c months after any modification of the assessment to reflect and account for such outcome4 7viii7 ,regulations ,the ,copyright ,royalty ,judges may adopt regulations to govern the conduct of proceedings under this paragraph4 7#h7 ,establishment of rates and terms under blanket license 7,a7 ,restrictions on ratesetting participation ,neither the mechanical licensing collective nor the digital licensee coordinator shall be a party to a proceeding described in subsection 7c77#a77;,e71 but either may gather and provide financial and other information for the use of a party to such a proceeding and comply with requests for information as required under applicable statutory and regulatory provisions and rulings of the ,copyright ,royalty ,judges4 7,b7 ,application of late fees ,in any proceeding described in subparagraph 7,a7 in which the ,copyright ,royalty ,judges establish a late fee for late payment of royalties for uses of musical works under this section1 such fee shall apply to covered activities under blanket licenses1 as follows3 7i7 ,late fees for past due royalty payments shall accrue from the due date for payment until payment is received by the mechanical licensing collective4 7ii7 ,the availability of late fees shall in no way prevent a copyright owner or the mechanical licensing collective from asserting any other rights or remedies to which such copyright owner or the mechanical licensing collective may be entitled under this title4 7,c7 ,interim rate agreements in general ,for any covered activity for which no rate or terms have been established by the ,copyright ,royalty ,judges1 the mechanical licensing collective and any digital music provider may agree to an interim rate and terms for such activity under the blanket license1 and any such rate and terms-- 7i7 shall be treated as nonprecedential and not cited or relied upon in any ratesetting proceeding before the ,copyright ,royalty ,judges or any other tribunal2 and 7ii7 shall automatically expire upon the establishment of a rate and terms for such covered activity by the ,copyright ,royalty ,judges1 under subsection 7c77#a77;,e74 7,d7 ,adjustments for interim rates ,the rate and terms established by the ,copyright ,royalty ,judges for a covered activity to which an interim rate and terms have been agreed under subparagraph 7,c7 shall supersede the interim rate and terms and apply retroactively to the inception of the activity under the blanket license4 ,in such case1 within #c months after the rate and terms established by the ,copyright ,royalty ,judges become effective-- 7i7 if the rate established by the ,copyright ,royalty ,judges exceeds the interim rate1 the digital music provider shall pay to the mechanical licensing collective the amount of any underpayment of royalties due2 or 7ii7 if the interim rate exceeds the rate established by the ,copyright ,royalty ,judges1 the mechanical licensing collective shall credit the account of the digital music provider for the amount of any overpayment of royalties due4 7#i7 ,transition to blanket licenses 7,a7 ,substitution of blanket license ,on the license availability date1 a blanket license shall1 without any interruption in license authority enjoyed by such digital music provider1 be automatically substituted for and supersede any existing compulsory license previously obtained under this section by the digital music provider from a copyright owner to engage in one or more covered activities with respect to a musical work1 but the foregoing shall not apply to any authority obtained from a record company pursuant to a compulsory license to make and distribute permanent downloads unless and until such record company terminates such authority in writing to take effect at the end of a monthly reporting period1 with a copy to the mechanical licensing collective4 7,b7 ,expiration of existing licenses ,except to the extent provided in subparagraph 7,a71 on and after the license availability date1 licenses other than individual download licenses obtained under this section for covered activities prior to the license availability date shall no longer continue in effect4 7,c7 ,treatment of voluntary licenses ,a voluntary license for a covered activity in effect on the license availability date will remain in effect unless and until the voluntary license expires according to the terms of the voluntary license1 or the parties agree to amend or terminate the voluntary license4 ,in a case where a voluntary license for a covered activity entered into before the license availability date incorporates the terms of this section by reference1 the terms so incorporated 7but not the rates7 shall be those in effect immediately prior to the license availability date1 and those terms shall continue to apply unless and until such voluntary license is terminated or amended1 or the parties enter into a new voluntary license4 7,d7 ,further acceptance of notices for covered activities by ,copyright ,office ,on and after the enactment date-- 7i7 the ,copyright ,office shall no longer accept notices of intention with respect to covered activities2 and 7ii7 previously filed notices of intention will no longer be effective or provide license authority with respect to covered activities1 but before the license availability date there shall be no liability under section #eja for the reproduction or distribution of a musical work 7or share thereof7 in covered activities if a valid notice of intention was filed for such work 7or share7 before the enactment date4 7#aj7 ,prior unlicensed uses 7,a7 ,limitation on liability in general ,a copyright owner that commences an action under section #eja on or after ,january #a1 #bjah1 against a digital music provider for the infringement of the exclusive rights provided by paragraph 7#a7 or 7#c7 of section #ajf arising from the unauthorized reproduction or distribution of a musical work by such digital music provider in the course of engaging in covered activities prior to the license availability date1 shall1 as the copyright owner's sole and exclusive remedy against the digital music provider1 be eligible to recover the royalty prescribed under subsection 7c77#a77;,c7 and chapter #h of this title1 from the digital music provider1 provided that such digital music provider can demonstrate compliance with the requirements of subparagraph 7,b71 as applicable4 ,in all other cases the limitation on liability under this subparagraph shall not apply4 7,b7 ,requirements for limitation on liability ,the following requirements shall apply on the enactment date and through the end of the period that expires #ij days after the license availability date to digital music providers seeking to avail themselves of the limitation on liability described in subparagraph 7,a73 7i7 ,no later than #cj calendar days after first making a particular sound recording of a musical work available through its service via one or more covered activities1 or #cj calendar days after the enactment date1 whichever occurs later1 a digital music provider shall engage in good-faith1 commercially reasonable efforts to identify and locate each copyright owner of such musical work 7or share thereof74 ,such required matching efforts shall include the following3 7,i7 ,good-faith1 commercially reasonable efforts to obtain from the owner of the corresponding sound recording made available through the digital music provider's service the following information3 7aa7 ,sound recording name1 featured artist1 sound recording copyright owner1 producer1 international standard recording code1 and other information commonly used in the industry to identify sound recordings and match them to the musical works they embody4 7bb7 ,any available musical work ownership information1 including each songwriter and publisher name1 percentage ownership share1 and international standard musical work code4 7,,ii7 ,employment of one or more bulk electronic matching processes that are available to the digital music provider through a third-party vendor on commercially reasonable terms1 but a digital music provider may rely on its own bulk electronic matching process if it has capabilities comparable to or better than those available from a third-party vendor on commercially reasonable terms4 7ii7 ,the required matching efforts shall be repeated by the digital music provider no less than once per month for so long as the copyright owner remains unidentified or has not been located4 7iii7 ,if the required matching efforts are successful in identifying and locating a copyright owner of a musical work 7or share thereof7 by the end of the calendar month in which the digital music provider first makes use of the work1 the digital music provider shall provide statements of account and pay royalties to such copyright owner in accordance with this section and applicable regulations4 7iv7 ,if the copyright owner is not identified or located by the end of the calendar month in which the digital music provider first makes use of the work1 the digital music provider shall accrue and hold royalties calculated under the applicable statutory rate in accordance with usage of the work1 from initial use of the work until the accrued royalties can be paid to the copyright owner or are required to be transferred to the mechanical licensing collective1 as follows3 7,i7 ,accrued royalties shall be maintained by the digital music provider in accordance with generally accepted accounting principles4 7,,ii7 ,if a copyright owner of an unmatched musical work 7or share thereof7 is identified and located by or to the digital music provider before the license availability date1 the digital music provider shall-- 7aa7 within #de calendar days after the end of the calendar month during which the copyright owner was identified and located1 pay the copyright owner all accrued royalties1 such payment to be accompanied by a cumulative statement of account that includes all of the information that would have been provided to the copyright owner had the digital music provider been providing monthly statements of account to the copyright owner from initial use of the work in accordance with this section and applicable regulations1 including the requisite certification under subsection 7c77#b77;,i72 7bb7 beginning with the accounting period following the calendar month in which the copyright owner was identified and located1 and for all other accounting periods prior to the license availability date1 provide monthly statements of account and pay royalties to the copyright owner as required under this section and applicable regulations2 and 7cc7 beginning with the monthly royalty reporting period commencing on the license availability date1 report usage and pay royalties for such musical work 7or share thereof7 for such reporting period and reporting periods thereafter to the mechanical licensing collective1 as required under this subsection and applicable regulations4 7,,iii7 ,if a copyright owner of an unmatched musical work 7or share thereof7 is not identified and located by the license availability date1 the digital music provider shall-- 7aa7 within #de calendar days after the license availability date1 transfer all accrued royalties to the mechanical licensing collective1 such payment to be accompanied by a cumulative statement of account that includes all of the information that would have been provided to the copyright owner had the digital music provider been serving monthly statements of account on the copyright owner from initial use of the work in accordance with this section and applicable regulations1 including the requisite certification under subsection 7c77#b77;,i71 and accompanied by an additional certification by a duly authorized officer of the digital music provider that the digital music provider has fulfilled the requirements of clauses 7i7 and 7ii7 of subparagraph 7,b7 but has not been successful in locating or identifying the copyright owner2 and 7bb7 beginning with the monthly royalty reporting period commencing on the license availability date1 report usage and pay royalties for such musical work 7or share thereof7 for such period and reporting periods thereafter to the mechanical licensing collective1 as required under this subsection and applicable regulations4 7v7 ,suspension of late fees ,a digital music provider that complies with the requirements of this paragraph with respect to unmatched musical works 7or shares of works7 shall not be liable for or accrue late fees for late payments of royalties for such works until such time as the digital music provider is required to begin paying monthly royalties to the copyright owner or the mechanical licensing collective1 as applicable4 7,c7 ,adjusted statute of limitations ,notwithstanding anything to the contrary in section #ejg7;b71 with respect to any claim of infringement of the exclusive rights provided by paragraphs 7#a7 and 7#c7 of section #ajf against a digital music provider arising from the unauthorized reproduction or distribution of a musical work by such digital music provider to engage in covered activities that accrued no more than #c years prior to the license availability date1 such action may be commenced within #c years of the date the claim accrued1 or up to #b years after the license availability date1 whichever is later4 7,d7 ,other rights and remedies preserved ,except as expressly provided in this paragraph1 nothing in this paragraph shall be construed to alter1 limit1 or negate any right or remedy of a copyright owner with respect to unauthorized use of a musical work4 7#aa7 ,legal protections for licensing activities 7,a7 ,exemption for compulsory license activities ,the antitrust exemption described in subsection 7c77#a77;,d7 shall apply to negotiations and agreements between and among copyright owners and persons entitled to obtain a compulsory license for covered activities1 and common agents acting on behalf of such copyright owners or persons1 including with respect to the administrative assessment established under this subsection4 7,b7 ,limitation on common agent exemption ,notwithstanding the antitrust exemption provided in subsection 7c77#a77;,d7 and subparagraph 7,a7 7except for the administrative assessment referenced therein and except as provided in paragraph 7#h77;,c771 neither the mechanical licensing collective nor the digital licensee coordinator shall serve as a common agent with respect to the establishment of royalty rates or terms under this section4 7,c7 ,antitrust exemption for administrative activities ,notwithstanding any provision of the antitrust laws1 copyright owners and persons entitled to obtain a compulsory license under this section may designate the mechanical licensing collective to administer voluntary licenses for the reproduction or distribution of musical works in covered activities on behalf of such copyright owners and persons1 but the following conditions apply3 7i7 ,each copyright owner shall establish the royalty rates and material terms of any such voluntary license individually and not in agreement1 combination1 or concert with any other copyright owner4 7ii7 ,each person entitled to obtain a compulsory license under this section shall establish the royalty rates and material terms of any such voluntary license individually and not in agreement1 combination1 or concert with any other digital music provider4 7iii7 ,the mechanical licensing collective shall maintain the confidentiality of the voluntary licenses in accordance with the confidentiality provisions prescribed by the ,register of ,copyrights under paragraph 7#ab77;,c74 7,d7 ,liability for good-faith activities ,the mechanical licensing collective shall not be liable to any person or entity based on a claim arising from its good-faith administration of policies and procedures adopted and implemented to carry out the responsibilities described in subparagraphs 7,j7 and 7,k7 of paragraph 7#c71 except to the extent of correcting an underpayment or overpayment of royalties as provided in paragraph 7#c77,l77i77,,vi71 but the collective may participate in a legal proceeding as a stakeholder party if the collective is holding funds that are the subject of a dispute between copyright owners4 ,for purposes of this subparagraph1 good-faith administration means administration in a manner that is not grossly negligent4 7,e7 ,preemption of ,state property laws ,the holding and distribution of funds by the mechanical licensing collective in accordance with this subsection shall supersede and preempt any ,state law 7including common law7 concerning escheatment or abandoned property1 or any analogous provision1 that might otherwise apply4 7,f7 ,rule of construction ,except as expressly provided in this subsection1 nothing in this subsection shall negate or limit the ability of any person to pursue an action in ,federal court against the mechanical licensing collective or any other person based upon a claim arising under this title or other applicable law4 7#ab7 ,regulations 7,a7 ,adoption by register of copyrights and copyright royalty judges ,the ,register of ,copyrights may conduct such proceedings and adopt such regulations as may be necessary or appropriate to effectuate the provisions of this subsection1 except for regulations concerning proceedings before the ,copyright ,royalty ,judges to establish the administrative assessment1 which shall be adopted by the ,copyright ,royalty ,judges4 7,b7 ,judicial review of regulations ,except as provided in paragraph 7#g77;,d77vii71 regulations adopted under this subsection shall be subject to judicial review pursuant to chapter #g of title #e4 7,c7 ,protection of confidential information ,the ,register of ,copyrights shall adopt regulations to provide for the appropriate procedures to ensure that confidential1 private1 proprietary1 or privileged information contained in the records of the mechanical licensing collective and digital licensee coordinator is not improperly disclosed or used1 including through any disclosure or use by the board of directors or personnel of either entity1 and specifically including the unclaimed royalties oversight committee and the dispute resolution committee of the mechanical licensing collective4 7#ac7 ,savings clauses 7,a7 ,limitation on activities and rights covered ,this subsection applies solely to uses of musical works subject to licensing under this section4 ,the blanket license shall not be construed to extend or apply to activities other than covered activities or to rights other than the exclusive rights of reproduction and distribution licensed under this section1 or serve or act as the basis to extend or expand the compulsory license under this section to activities and rights not covered by this section on the enactment date4 7,b7 ,rights of public performance not affected ,the rights1 protections1 and immunities granted under this subsection1 the data concerning musical works collected and made available under this subsection1 and the definitions described in subsection 7e7 shall not extend to1 limit1 or otherwise affect any right of public performance in a musical work4 2 and 7#e7 by adding at the end the following new subsection3 7e7 ,definitions ,as used in this section3 7#a7 ,accrued interest ,the term accrued interest means interest accrued on accrued royalties1 as described in subsection 7d77#c77;,h77ii74 7#b7 ,accrued royalties ,the term accrued royalties means royalties accrued for the reproduction or distribution of a musical work 7or share thereof7 in a covered activity1 calculated in accordance with the applicable royalty rate under this section4 7#c7 ,administrative assessment ,the term administrative assessment means the fee established pursuant to subsection 7d77#g77;,d74 7#d7 ,audit ,the term audit means a royalty compliance examination to verify the accuracy of royalty payments1 or the conduct of such an examination1 as applicable4 7#e7 ,blanket license ,the term blanket license means a compulsory license described in subsection 7d77#a77;,a7 to engage in covered activities4 7#f7 ,collective total costs ,the term collective total costs-- 7,a7 means the total costs of establishing1 maintaining1 and operating the mechanical licensing collective to fulfill its statutory functions1 including-- 7i7 startup costs2 7ii7 financing1 legal1 and insurance costs2 7iii7 investments in information technology1 infrastructure1 and other long-term resources2 7iv7 outside vendor costs2 7v7 costs of licensing1 royalty administration1 and enforcement of rights2 7vi7 costs of bad debt2 and 7vii7 costs of automated and manual efforts to identify and locate copyright owners of musical works 7and shares of such musical works7 and match sound recordings to the musical works the sound recordings embody2 and 7,b7 does not include any added costs incurred by the mechanical licensing collective to provide services under voluntary licenses4 7#g7 ,covered activity ,the term covered activity means the activity of making a digital phonorecord delivery of a musical work1 including in the form of a permanent download1 limited download1 or interactive stream1 where such activity qualified for a compulsory license under this section4 7#h7 ,digital music provider ,the term digital music provider means a person 7or persons operating under the authority of that person7 that1 with respect to a service engaged in covered activities-- 7,a7 has a direct contractual1 subscription1 or other economic relationship with end users of the service1 or1 if no such relationship with end users exists1 exercises direct control over the provision of the service to end users2 7,b7 is able to fully report on any revenues and consideration generated by the service2 and 7,c7 is able to fully report on usage of sound recordings of musical works by the service 7or procure such reporting74 7#i7 ,digital licensee coordinator ,the term digital licensee coordinator means the entity most recently designated pursuant to subsection 7d77#e74 7#aj7 ,digital phonorecord delivery ,the term digital phonorecord delivery means each individual delivery of a phonorecord by digital transmission of a sound recording that results in a specifically identifiable reproduction by or for any transmission recipient of a phonorecord of that sound recording1 regardless of whether the digital transmission is also a public performance of the sound recording or any musical work embodied therein1 and includes a permanent download1 a limited download1 or an interactive stream4 ,a digital phonorecord delivery does not result from a real-time1 noninteractive subscription transmission of a sound recording where no reproduction of the sound recording or the musical work embodied therein is made from the inception of the transmission through to its receipt by the transmission recipient in order to make the sound recording audible4 ,a digital phonorecord delivery does not include the digital transmission of sounds accompanying a motion picture or other audiovisual work as defined in section #aja of this title4 7#aa7 ,enactment date ,the term enactment date means the date of the enactment of the ,musical ,works ,modernization ,act4 7#ab7 ,individual download license ,the term individual download license means a compulsory license obtained by a record company to make and distribute1 or authorize the making and distribution of1 permanent downloads embodying a specific individual musical work4 7#ac7 ,interactive stream ,the term interactive stream means a digital transmission of a sound recording of a musical work in the form of a stream1 where the performance of the sound recording by means of such transmission is not exempt under section #aad7;d77#a7 and does not in itself1 or as a result of a program in which it is included1 qualify for statutory licensing under section #aad7;d77#b74 ,an interactive stream is a digital phonorecord delivery4 7#ad7 ,interested ,the term interested1 as applied to a party seeking to participate in a proceeding under subsection 7d77#g77;,d71 is a party as to which the ,copyright ,royalty ,judges have not determined that the party lacks a significant interest in such proceeding4 7#ae7 ,license availability date ,the term license availability date means the next ,january #a following the expiration of the #b-year period beginning on the enactment date4 7#af7 ,limited download ,the term limited download means a digital transmission of a sound recording of a musical work in the form of a download1 where such sound recording is accessible for listening only for a limited amount of time or specified number of times4 7#ag7 ,matched ,the term matched1 as applied to a musical work 7or share thereof71 means that the copyright owner of such work 7or share thereof7 has been identified and located4 7#ah7 ,mechanical licensing collective ,the term mechanical licensing collective means the entity most recently designated as such by the ,register of ,copyrights under subsection 7d77#c74 7#ai7 ,mechanical licensing collective budget ,the term mechanical licensing collective budget means a statement of the financial position of the mechanical licensing collective for a fiscal year or quarter thereof based on estimates of expenditures during the period and proposals for financing them1 including a calculation of the collective total costs4 7#bj7 ,musical works database ,the term musical works database means the database described in subsection 7d77#c77;,e74 7#ba7 ,nonprofit ,the term nonprofit means a nonprofit created or organized in a ,state4 7#bb7 ,notice of license ,the term notice of license means a notice from a digital music provider provided under subsection 7d77#b77;,a7 for purposes of obtaining a blanket license4 7#bc7 ,notice of nonblanket activity ,the term notice of nonblanket activity means a notice from a significant nonblanket licensee provided under subsection 7d77#f77;,a7 for purposes of notifying the mechanical licensing collective that the licensee has been engaging in covered activities4 7#bd7 ,permanent download ,the term permanent download means a digital transmission of a sound recording of a musical work in the form of a download1 where such sound recording is accessible for listening without restriction as to the amount of time or number of times it may be accessed4 7#be7 ,qualified auditor ,the term qualified auditor means an independent1 certified public accountant with experience performing music royalty audits4 7#bf7 ,record company ,the term record company means an entity that invests in1 produces1 and markets sound recordings of musical works1 and distributes such sound recordings for remuneration through multiple sales channels1 including a corporate affiliate of such an entity engaged in distribution of sound recordings4 7#bg7 ,report of usage ,the term report of usage means a report reflecting an entity's usage of musical works in covered activities described in subsection 7d77#d77;,a74 7#bh7 ,required matching efforts ,the term required matching efforts means efforts to identify and locate copyright owners of musical works as described in subsection 7d77#aj77;,b77i74 7#bi7 ,service ,the term service1 as used in relation to covered activities1 means any site1 facility1 or offering by or through which sound recordings of musical works are digitally transmitted to members of the public4 7#cj7 ,share ,the term share1 as applied to a musical work1 means a fractional ownership interest in such work4 7#ca7 ,significant nonblanket licensee ,the term significant nonblanket licensee-- 7,a7 means an entity1 including a group of entities under common ownership or control that1 acting under the authority of one or more voluntary licenses or individual download licenses1 offers a service engaged in covered activities1 and such entity or group of entities-- 7i7 is not currently operating under a blanket license and is not obligated to provide reports of usage reflecting covered activities under subsection 7d77#d77;,a72 7ii7 has a direct contractual1 subscription1 or other economic relationship with end users of the service or1 if no such relationship with end users exists1 exercises direct control over the provision of the service to end users2 and 7iii7 either-- 7,i7 on any day in a calendar month1 makes more than #e1jjj different sound recordings of musical works available through such service2 or 7,,ii7 derives revenue or other consideration in connection with such covered activities greater than #ej1jjj in a calendar month1 or total revenue or other consideration greater than #ejj1jjj during the preceding #ab calendar months2 and 7,b7 does not include-- 7i7 an entity whose covered activity consists solely of free-to-the-user streams of segments of sound recordings of musical works that do not exceed #ij seconds in length1 are offered only to facilitate a licensed use of musical works that is not a covered activity1 and have no revenue directly attributable to such streams constituting the covered activity2 or 7ii7 a public broadcasting entity as defined in section #aah7;f74 7#cb7 ,songwriter ,the term songwriter means the author of all or part of a musical work1 including a composer or lyricist4 7#cc7 ,state ,the term ,state means each ,state of the ,united ,states1 the ,district of ,columbia1 and each territory or possession of the ,united ,states4 7#cd7 ,unclaimed accrued royalties ,the term unclaimed accrued royalties means accrued royalties eligible for distribution under subsection 7d77#c77;,j74 7#ce7 ,unmatched ,the term unmatched1 as applied to a musical work 7or share thereof71 means that the copyright owner of such work 7or share thereof7 has not been identified or located4 7#cf7 ,voluntary license ,the term voluntary license means a license for use of a musical work 7or share thereof7 other than a compulsory license obtained under this section4 4 7b7 ,technical and conforming amendments to section #hja ,section #hja7;b7 of title #ag1 ,united ,states ,code1 is amended-- 7#a7 by redesignating paragraph 7#h7 as paragraph 7#i72 and 7#b7 by inserting after paragraph 7#g7 the following new paragraph3 7#h7 ,to determine the administrative assessment to be paid by digital music providers under section #aae7;d74 ,the provisions of section #aae7;d7 shall apply to the conduct of proceedings by the ,copyright ,royalty ,judges under section #aae7;d7 and not the procedures described in this section1 or section #hjc1 #hjd1 or #hje4 4 7c7 ,effective date of amended rate setting standard ,the amendments made by subsections 7a77#c77;,d7 and 7b77#a7 shall apply to any proceeding before the ,copyright ,royalty ,judges that is pending on1 or commenced on or after1 the date of the enactment of this ,act4 7d7 ,technical and conforming amendments to title #cg1 part #che of the ,code of ,federal ,regulations ,within #i months after the date of the enactment of this ,act1 the ,copyright ,royalty ,judges shall amend the regulations for section #aae in part #che of title #cg1 ,code of ,federal ,regulations to conform the definitions used in such part to the definitions of the same terms described in section #aae7;e7 of title #ag1 ,united ,states ,code1 as amended by subsection 7a74 ,in so doing1 the ,copyright ,royalty ,judges shall make adjustments to the language of the regulations as necessary to achieve the same purpose and effect as the original regulations with respect to the rates and terms previously adopted by the ,copyright ,royalty ,judges4 #ajc4 ,amendments to section #aad 7a7 ,uniform rate standard ,section #aad7;f7 of title #ag1 ,united ,states ,code1 is amended-- 7#a7 by striking paragraphs 7#a7 and 7#b7 and inserting the following3 7#a7 7,a7 ,proceedings under chapter #h shall determine reasonable rates and terms of royalty payments for transmissions subject to statutory licensing under subsection 7d77#b7 during the #e-year period beginning on ,january #a of the second year following the year in which the proceedings are to be commenced pursuant to subparagraph 7,a7 or 7,b7 of section #hjd7;b77#c71 as the case may be1 or such other period as the parties may agree4 ,the parties to each proceeding shall bear their own costs4 7,b7 ,the schedule of reasonable rates and terms determined by the ,copyright ,royalty ,judges shall1 subject to paragraph 7#b71 be binding on all copyright owners of sound recordings and entities performing sound recordings affected by this paragraph during the #e-year period specified in subparagraph 7,a71 or such other period as the parties may agree4 ,such rates and terms shall distinguish among the different types of services then in operation and shall include a minimum fee for each such type of service1 such differences to be based on criteria including the quantity and nature of the use of sound recordings and the degree to which use of the service may substitute for or may promote the purchase of phonorecords by consumers4 ,the ,copyright ,royalty ,judges shall establish rates and terms that most clearly represent the rates and terms that would have been negotiated in the marketplace between a willing buyer and a willing seller4 ,in determining such rates and terms1 the ,copyright ,royalty ,judges-- 7i7 shall base their decision on economic1 competitive1 and programming information presented by the parties1 including-- 7,i7 whether use of the service may substitute for or may promote the sales of phonorecords or otherwise may interfere with or may enhance the sound recording copyright owner's other streams of revenue from the copyright owner's sound recordings2 and 7,,ii7 the relative roles of the copyright owner and the transmitting entity in the copyrighted work and the service made available to the public with respect to relative creative contribution1 technological contribution1 capital investment1 cost1 and risk2 and 7ii7 may consider the rates and terms for comparable types of audio transmission services and comparable circumstances under voluntary license agreements4 7,c7 ,the procedures under subparagraphs 7,a7 and 7,b7 shall also be initiated pursuant to a petition filed by any sound recording copyright owner or any transmitting entity indicating that a new type of service on which sound recordings are performed is or is about to become operational1 for the purpose of determining reasonable terms and rates of royalty payments with respect to such new type of service for the period beginning with the inception of such new type of service and ending on the date on which the royalty rates and terms for eligible nonsubscription services and new subscription services1 or preexisting services1 as the case may be1 most recently determined under subparagraph 7,a7 or 7,b7 and chapter #h expire1 or such other period as the parties may agree4 2 and 7#b7 by redesignating paragraphs 7#c71 7#d71 and 7#e7 as paragraphs 7#b71 7#c71 and 7#d71 respectively4 7b7 ,repeal ,subsection 7i7 of section #aad of title #ag1 ,united ,states ,code1 is repealed4 7c7 ,use in musical work proceedings 7#a7 ,in general ,license fees payable for the public performance of sound recordings under section #ajf7f7 of title #ag1 ,united ,states ,code1 shall not be taken into account in any administrative1 judicial1 or other governmental proceeding to set or adjust the royalties payable to musical work copyright owners for the public performance of their works except in such a proceeding to set or adjust royalties for the public performance of musical works by means of a digital audio transmission other than a transmission by a broadcaster1 and may be taken into account only with respect to such digital audio transmission4 7#b7 ,definitions ,in this subsection3 7,a7 ,transmission by a broadcaster ,a transmission by a broadcaster means a nonsubscription digital transmission made by a terrestrial broadcast station on its own behalf1 or on the behalf of a terrestrial broadcast station under common ownership or control1 that is not part of an interactive service or a music-intensive service comprising the transmission of sound recordings customized for or customizable by recipients or service users4 7,b7 ,terrestrial broadcast station ,a terrestrial broadcast station means a terrestrial1 over-the-air radio or television broadcast station1 licensed as such by the ,federal ,communications ,commission1 including an ,,fm ,translator as defined in section #gd4abca of title #dg1 ,code of ,federal ,regulations1 and whose primary business activities are comprised of1 and revenues are generated through1 terrestrial1 over-the-air broadcast transmissions1 or the simultaneous or substantially-simultaneous digital retransmission by the terrestrial1 over-the-air broadcast station of its over-the-air broadcast transmissions4 7d7 ,rule of construction ,subsection 7c77#b7 shall not be given effect in interpreting provisions of title #ag1 ,united ,states ,code4 7e7 ,use in sound recording proceedings ,the repeal of section #aad7;i7 of title #ag1 ,united ,states ,code1 by subsection 7b7 shall not be taken into account in any proceeding to set or adjust the rates and fees payable for the use of sound recordings under section #aab7;e7 or section #aad7;f7 of such title that is pending on1 or commenced on or after1 the date of the enactment of this ,act4 7f7 ,decisions and precedents not affected ,the repeal of section #aad7;i7 of title #ag1 ,united ,states ,code1 by subsection 7b7 shall not have any effect upon the decisions1 or the precedents established or relied upon1 in any proceeding to set or adjust the rates and fees payable for the use of sound recordings under section #aab7;e7 or section #aad7;f7 of such title before the date of the enactment of this ,act4 7g7 ,technical and conforming amendments 7#a7 ,section #aad ,section #aad7;f7 of title #ag1 ,united ,states ,code1 as amended by subsection 7a71 is further amended in paragraph 7#d77;,c71 as so redesignated1 by striking under paragraph 7#d7 and inserting under paragraph 7#c74 7#b7 ,section #hja ,section #hja7;b77#a7 of title #ag1 ,united ,states ,code1 is amended by striking ,the rates applicable and all that follows though prevailing industry practices44 7#c7 ,section #hjd ,section #hjd7;b77#c77;,c7 of title #ag1 ,united ,states ,code1 is amended-- 7,a7 in clause 7i71 by striking and #aad7;f77#b77;,c72 7,b7 in clause 7iii77,,ii71 by striking #aad7;f77#d77;,b77ii7 and inserting #aad7;f77#c77;,b77ii72 and 7,c7 in clause 7iv71 by striking or #aad7;f77#b77;,c71 as the case may be4 #ajd4 ,random assignment of rate court proceedings ,section #acg of title #bh1 ,united ,states ,code1 is amended-- 7#a7 by striking ,the business and inserting 7a7 ,in general4--,the business2 and 7#b7 by adding at the end the following new subsection3 7b7 ,random ,assignment of ,rate ,court ,proceedings 7#a7 ,in general 7,a7 ,determination of license fee ,except as provided in subparagraph 7,b71 in the case of any performing rights society subject to a consent decree1 any application for the determination of a license fee for the public performance of music in accordance with the applicable consent decree shall be made in the district court with jurisdiction over that consent decree and randomly assigned to a judge of that district court according to that court's rules for the division of business among district judges currently in effect or as may be amended from time to time1 provided that any such application shall not be assigned to-- 7i7 a judge to whom continuing jurisdiction over any performing rights society for any performing rights society consent decree is assigned or has previously been assigned2 or 7ii7 a judge to whom another proceeding concerning an application for the determination of a reasonable license fee is assigned at the time of the filing of the application4 7,b7 ,exception ,subparagraph 7,a7 does not apply to an application to determine reasonable license fees made by individual proprietors under section #eac of title #ag4 7#b7 ,rule of construction ,nothing in paragraph 7#a7 shall modify the rights of any party to a consent decree or to a proceeding to determine reasonable license fees1 to make an application for the construction of any provision of the applicable consent decree4 ,such application shall be referred to the judge to whom continuing jurisdiction over the applicable consent decree is currently assigned4 ,if any such application is made in connection with a rate proceeding1 such rate proceeding shall be stayed until the final determination of the construction application4 ,disputes in connection with a rate proceeding about whether a licensee is similarly situated to another licensee shall not be subject to referral to the judge with continuing jurisdiction over the applicable consent decree4 4 ,,ii ,compensating ,legacy ,artists for their ,songs1 ,service1 and ,important ,contributions to ,society #bja4 ,short title ,this title may be cited as the ,compensating ,legacy ,artists for their ,songs1 ,service1 and ,important ,contributions to ,society ,act or the ,,classics ,act4 #bjb4 ,unauthorized digital performance of pre-#aigb sound recordings 7a7 ,protection for unauthorized digital performances ,title #ag1 ,united ,states ,code1 is amended by adding at the end the following new chapter3 #ad ,unauthorized ,digital ,performance of ,pre-#aigb ,sound ,recordings ,sec4#adja4 ,unauthorized digital performance of pre-#aigb sound recordings4 #adja4 ,unauthorized digital performance of pre-#aigb sound recordings 7a7 ,unauthorized acts ,anyone who1 before ,february #ae1 #bjfg1 and without the consent of the rights owner1 performs publicly1 by means of a digital audio transmission1 a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 shall be subject to the remedies provided in sections #ejb through #eje to the same extent as an infringer of copyright4 7b7 ,certain authorized transmissions ,a digital audio transmission of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 shall1 for purposes of subsection 7a71 be considered to be authorized and made with the consent of the rights owner if-- 7#a7 the transmission is made by a transmitting entity that is publicly performing sound recordings fixed on or after ,february #ae1 #aigb1 by means of digital audio transmissions subject to section #aad2 7#b7 the transmission would satisfy the requirements for statutory licensing under section #aad7;d77#b71 or would be exempt under section #aad7;d77#a71 if the sound recording were fixed on or after ,february #ae1 #aigb2 7#c7 in the case of a transmission that would not be exempt under section #aad7;d77#a7 as described in paragraph 7#b71 the transmitting entity pays statutory royalties and provides notice of its use of the relevant sound recordings in the same manner as is required by regulations adopted by the ,copyright ,royalty ,judges for sound recordings fixed on or after ,february #ae1 #aigb2 and 7#d7 in the case of a transmission that would not be exempt under section #aad7;d77#a7 as described in paragraph 7#b71 the transmitting entity otherwise satisfies the requirements for statutory licensing under section #aad7;f77#d77;,b74 7c7 ,transmissions by direct licensing of statutory services 7#a7 ,in general ,a transmission of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 shall1 for purposes of subsection 7a71 be considered to be authorized and made with the consent of the rights owner if such transmission is included in a license agreement voluntarily negotiated at any time between the rights owner and the entity performing the sound recording4 7#b7 ,payment of royalties to nonprofit collective ,to the extent that such a license agreement entered into on or after the date of the enactment of this section extends to digital audio transmissions of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 that meet the conditions of subsection 7b71 the licensee shall pay1 to the collective designated to distribute receipts from the licensing of transmissions in accordance with section #aad7;f71 #ej percent of the performance royalties for the transmissions due under the license1 with such royalties fully credited as payments due under the license4 7#c7 ,distribution of royalties by collective ,the collective described in paragraph 7#b7 shall1 in accordance with subparagraphs 7,b7 through 7,d7 of section #aad7;g77#b71 and paragraphs 7#e7 and 7#f7 of section #aad7;g71 distribute the royalties received under paragraph 7#b7 under the license described in paragraph 7#b74 ,such payments shall be the only payments to which featured and nonfeatured artists are entitled by virtue of the transmissions described in paragraph 7#b7 under the license4 7#d7 ,rule of construction ,this section does not prohibit any other license from directing the licensee to pay other royalties due to featured and nonfeatured artists for such transmissions to the collective designated to distribute receipts from the licensing of transmissions in accordance with section #aad7;f74 7d7 ,relationship to ,state law 7#a7 ,in general ,nothing in this section shall be construed to annul or limit any rights or remedies under the common law or statutes of any ,state for sound recordings fixed before ,february #ae1 #aigb1 except1 notwithstanding section #cja7;c71 for the following3 7,a7 ,this section preempts any claim of common law copyright or equivalent right under the laws of any ,state arising from any digital audio transmission that is made1 on and after the date of the enactment of this section1 of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb4 7,b7 ,this section preempts any claim of common law copyright or equivalent right under the laws of any ,state arising from any reproduction that is made1 on and after the date of the enactment of this section1 of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 and that would satisfy the requirements for statutory licensing under paragraphs 7#a7 and 7#f7 of section #aab7;e71 if the sound recording were fixed on or after ,february #ae1 #aigb4 7,c7 ,this section preempts any claim of common law copyright or equivalent right under the laws of any ,state arising from any digital audio transmission or reproduction that is made1 before the date of the enactment of this section1 of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb1 if-- 7i7 the digital audio transmission would have satisfied the requirements for statutory licensing under section #aad7;d77#b7 or been exempt under section #aad7;d77#a71 or the reproduction would have satisfied the requirements of section #aab7;e77#a71 as the case may be1 if the sound recording were fixed on or after ,february #ae1 #aigb2 and 7ii7 except in the case of transmissions that would have been exempt under section #aad7;d77#a71 the transmitting entity1 before the end of the #bgj-;day period beginning on the date of the enactment of this section1 pays statutory royalties and provides notice of the use of the relevant sound recordings in the same manner as is required by regulations adopted by the ,copyright ,royalty ,judges for sound recordings that are protected under this title for all the digital audio transmissions and reproductions satisfying the requirements for statutory licensing under section #aad7;d77#b7 and section #aab7;e77#a7 during the #c years prior to the date of the enactment of this section4 7#b7 ,rule of construction for common law copyright ,for purposes of subparagraphs 7,a7 through 7,c7 of paragraph 7#a71 a claim of common law copyright or equivalent right under the laws of any ,state includes a claim that characterizes conduct subject to such subparagraphs as an unlawful distribution1 act of record piracy1 or similar violation4 7#c7 ,rule of construction for public performance rights ,nothing in this section shall be construed to recognize or negate the existence of public performance rights in sound recordings under the laws of any ,state4 7e7 ,limitations on remedies 7#a7 ,fair use2 uses by libraries1 archives1 and educational institutions ,the limitations on the exclusive rights of a copyright owner described in sections #ajg1 #ajh1 and #aaj7a7 and 7#b7 shall apply to a claim under subsection 7a7 for the unauthorized performance of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb4 7#b7 ,actions ,the limitations on actions described in section #ejg shall apply to a claim under subsection 7a7 for the unauthorized performance of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb4 7#c7 ,material online ,section #eab shall apply to a claim under subsection 7a7 for the unauthorized performance of a sound recording fixed on or after ,january #a1 #aibc1 and before ,february #ae1 #aigb4 7#d7 ,principles of equity ,principles of equity apply to remedies for a violation of this section to the same extent as such principles apply to remedies for infringement of copyright4 7#e7 ,filing requirement for statutory damages and attorneys' fees 7,a7 ,filing of information on sound recordings 7i7 ,filing requirement ,except in the case of a transmitting entity that has filed contact information for that transmitting entity under subparagraph 7,b71 in any action under this section1 an award of statutory damages or of attorneys' fees under section #ejd or #eje may be made with respect to an unauthorized transmission of a sound recording under subsection 7a7 only if-- 7,i7 the rights owner has filed with the ,copyright ,office a schedule that specifies the title1 artist1 and rights owner of the sound recording and contains such other information1 as practicable1 as the ,register of ,copyrights prescribes by regulation2 and 7,,ii7 the transmission is made after the end of the #ij-;day period beginning on the date on which the information filed under subclause 7,i7 is indexed into the public records of the ,copyright ,office4 7ii7 ,regulations ,the ,register of ,copyrights shall1 before the end of the #ahj-;day period beginning on the date of the enactment of this section1 issue regulations establishing the form1 content1 and procedures for the filing of schedules under clause 7i74 ,such regulations shall provide that persons may request that they receive timely notification of such filings1 and shall set forth the manner in which such requests may be made4 7,b7 ,filing of contact information for transmitting entities 7i7 ,filing requirement ,the ,register of ,copyrights shall1 before the end of the #cj-;day period beginning on the date of the enactment of this section1 issue regulations establishing the form1 content1 and procedures for the filing1 by any entity that1 as of the date of the enactment of this section1 performs sound recordings fixed before ,february #ae1 #aigb1 by means of digital audio transmissions1 of contact information for such entity4 7ii7 ,time limit on filings ,the ,register of ,copyrights may accept filings under clause 7i7 only until the #ahjth day after the date of the enactment of this section4 7iii7 ,limitation on statutory damages and attorneys' fees 7,i7 ,limitation ,an award of statutory damages or of attorneys' fees under section #ejd or #eje may not be made1 against an entity that has filed contact information for that entity under clause 7i71 with respect to an unauthorized transmission by that entity of a sound recording under subsection 7a7 if the transmission is made before the end of the #ij-;day period beginning on the date on which the entity receives a notice that-- 7aa7 is sent by or on behalf of the rights owner of the sound recording2 7bb7 states that the entity is not legally authorized to transmit that sound recording under subsection 7a72 and 7cc7 identifies the sound recording in a schedule conforming to the requirements prescribed by the regulations issued under subparagraph 7,a77ii74 7,,ii7 ,undeliverable notices ,in any case in which a notice under subclause 7,i7 is sent to an entity by mail or courier service and the notice is returned to the sender because the entity either is no longer located at the address provided in the contact information filed under clause 7i7 or has refused to accept delivery1 or the notice is sent by electronic mail and is undeliverable1 the #ij-;day period under subclause 7,i7 shall begin on the date of the attempted delivery4 7,c7 ,section #dab ,section #dab shall not limit an award of statutory damages under section #ejd7;c7 or attorneys' fees under section #eje with respect to an unauthorized transmission of a sound recording under subsection 7a74 7#f7 ,applicability of other provisions 7,a7 ,in general ,subject to subparagraph 7,b71 no provision of this title shall apply to or limit the remedies available under this section except as otherwise provided in this section4 7,b7 ,applicability of definitions ,any term used in this section that is defined in section #aja shall have the meaning given that term in section #aja4 7f7 ,application of section #bcj safe harbor ,for purposes of section #bcj of the ,communications ,act of #aicd 7#dg ,u4,s4,c4 #bcj71 subsection 7a7 shall be considered to be a law pertaining to intellectual property under subsection 7e77#b7 of such section4 7g7 ,rights owner defined ,in this section1 the term rights owner means the person who has the exclusive right to reproduce a sound recording under the laws of any ,state4 4 7b7 ,conforming amendment ,the table of chapters for title #ag1 ,united ,states ,code1 is amended by adding at the end the following new chapter3 #ad4,unauthorized digital performance of pre-#aigb sound recordings #adja 4 #bjc4 ,effective date ,this title and the amendments made by this title shall take effect on the date of the enactment of this ,act4 ,,iii ,allocation for ,music ,producers #cja4 ,short title ,this title may be cited as the ,allocation for ,music ,producers ,act or the ,,amp ,act4 #cjb4 ,payment of statutory performance royalties 7a7 ,letter of direction ,section #aad7;g7 of title #ag1 ,united ,states ,code1 is amended by adding at the end the following new paragraph3 7#e7 ,letter of direction 7,a7 ,in general ,a nonprofit collective designated by the ,copyright ,royalty ,judges to distribute receipts from the licensing of transmissions in accordance with subsection 7f7 shall adopt and reasonably implement a policy that provides1 in circumstances determined by the collective to be appropriate1 for acceptance of instructions from an artist payee identified under subparagraph 7,a7 or 7,d7 of paragraph 7#b7 to distribute1 to a producer1 mixer1 or sound engineer who was part of the creative process that created a sound recording1 a portion of the payments to which the artist payee would otherwise be entitled from the licensing of transmissions of the sound recording4 ,in this section1 such instructions shall be referred to as a letter of direction4 7,b7 ,acceptance of letter ,to the extent that the collective accepts a letter of direction under subparagraph 7,a71 the person entitled to payment pursuant to the letter of direction shall1 during the period in which the letter of direction is in effect and carried out by the collective1 be treated for all purposes as the owner of the right to receive such payment1 and the artist payee providing the letter of direction to the collective shall be treated as having no interest in such payment4 7,c7 ,authority of collective ,this paragraph shall not be construed in such a manner so that the collective is not authorized to accept or act upon payment instructions in circumstances other than those to which this paragraph applies4 4 7b7 ,additional provisions for recordings fixed before ,november #a1 #aiie ,section #aad7;g7 of title #ag1 ,united ,states ,code1 as amended by subsection 7a71 is further amended by adding at the end the following new paragraph3 7#f7 ,sound recordings fixed before ,november #a1 #aiie 7,a7 ,payment absent letter of direction ,a nonprofit collective designated by the ,copyright ,royalty ,judges to distribute receipts from the licensing of transmissions in accordance with subsection 7f7 7in this paragraph referred to as the collective7 shall adopt and reasonably implement a policy that provides1 in circumstances determined by the collective to be appropriate1 for the deduction of #b percent of all the receipts that are collected from the licensing of transmissions of a sound recording fixed before ,november #a1 #aiie1 but which is withdrawn from the amount otherwise payable under paragraph 7#b77;,d7 to the recording artist or artists featured on the sound recording 7or the persons conveying rights in the artists' performance in the sound recording71 and the distribution of such amount to one or more persons described in subparagraph 7,b71 after deduction of costs described in paragraph 7#c7 or 7#d71 as applicable1 if each of the following requirements is met3 7i7 ,certification of attempt to obtain a letter of direction ,the person described in subparagraph 7,b7 who is to receive the distribution has certified to the collective1 under penalty of perjury1 that-- 7,i7 for a period of at least #d months1 that person made reasonable efforts to contact the artist payee for such sound recording to request and obtain a letter of direction instructing the collective to pay to that person a portion of the royalties payable to the featured recording artist or artists2 and 7,,ii7 during the period beginning on the date that person began the reasonable efforts described in subclause 7,i7 and ending on the date of that person's certification to the collective1 the artist payee did not affirm or deny in writing the request for a letter of direction4 7ii7 ,collective attempt to contact artist ,after receipt of the certification described in clause 7i7 and for a period of at least #d months before the collective's first distribution to the person described in subparagraph 7,b71 the collective attempted1 in a reasonable manner as determined by the collective1 to notify the artist payee of the certification made by the person described in subparagraph 7,b74 7iii7 ,no objection received ,the artist payee did not1 as of the date that is #aj business days before the date on which the first distribution is made1 submit to the collective in writing an objection to the distribution4 7,b7 ,eligibility for payment ,a person shall be eligible for payment under subparagraph 7,a7 if the person-- 7i7 is a producer1 mixer1 or sound engineer of the sound recording2 7ii7 has entered into a written contract with a record company involved in the creation or lawful exploitation of the sound recording1 or with the recording artist or artists featured on the sound recording 7or the persons conveying rights in the artists' performance in the sound recording71 under which the person seeking payment is entitled to participate in royalty payments that are based on the exploitation of the sound recording and are payable from royalties otherwise payable to the recording artist or artists featured on the sound recording 7or the persons conveying rights in the artists' performance in the sound recording72 7iii7 made a creative contribution to the creation of the sound recording2 and 7iv7 submits a written certification to the collective stating1 under penalty of perjury1 that the person meets the requirements in clauses 7i7 through 7iii7 and includes a true copy of the contract described in clause 7ii74 7,c7 ,multiple certifications ,subject to subparagraph 7,d71 in a case in which more than one person described in subparagraph 7,b7 has met the requirements for a distribution under subparagraph 7,a7 with respect to a sound recording as of the date that is #aj business days before the date on which a distribution is made1 the collective shall divide the #b percent distribution equally among all such persons4 7,d7 ,objection to payment ,not later than #aj business days after the date on which the collective receives from the artist payee a written objection to a distribution made pursuant to subparagraph 7,a71 the collective shall cease making any further payment relating to such distribution4 ,in any case in which the collective has made one or more distributions pursuant to subparagraph 7,a7 to a person described in subparagraph 7,b7 before the date that is #aj business days after the date on which the collective receives from the artist payee an objection to such distribution1 the objection shall not affect that person's entitlement to any distribution made before the collective ceases such distribution under this subparagraph4 7,e7 ,ownership of the right to receive payments ,to the extent that the collective determines that a distribution will be made under subparagraph 7,a7 to a person described in subparagraph 7,b71 such person shall1 during the period covered by such distribution1 be treated for all purposes as the owner of the right to receive such payments1 and the artist payee to whom such payments would otherwise be payable shall be treated as having no interest in such payments4 7,f7 ,artist payee defined ,in this paragraph1 the term artist payee means a person1 other than a person described in subparagraph 7,b71 who owns the right to receive all or part of the receipts payable under paragraph 7#b77;,d7 with respect to a sound recording4 ,in a case in which there are multiple artist payees with respect to a sound recording1 an objection by one such payee shall apply only to that payee's share of the receipts payable under paragraph 7#b77;,d71 and does not preclude payment under subparagraph 7,a7 from the share of an artist payee that does not so object4 4 7c7 ,technical and conforming amendments ,section #aad7;g7 of title #ag1 ,united ,states ,code1 as amended by subsections 7a7 and 7b71 is further amended-- 7#a7 in paragraph 7#b71 by striking ,an agent designated and inserting ,except as provided for in paragraph 7#f71 a nonprofit collective designated by the ,copyright ,royalty ,judges2 7#b7 in paragraph 7#c7-- 7,a7 by striking nonprofit agent designated and inserting nonprofit collective designated by the ,copyright ,royalty ,judges2 7,b7 by striking another designated agent and inserting another designated nonprofit collective2 and 7,c7 by striking agent and inserting collective each subsequent place it appears2 7#c7 in paragraph 7#d7-- 7,a7 by striking designated agent and inserting nonprofit collective2 and 7,b7 by striking agent and inserting collective each subsequent place it appears2 and 7#d7 by adding at the end the following new paragraph3 7#g7 ,preemption of ,state property laws ,the holding and distribution of receipts under section #aab and this section by a nonprofit collective designated by the ,copyright ,royalty ,judges in accordance with this subsection and regulations adopted by the ,copyright ,royalty ,judges shall supersede and preempt any ,state law 7including common law7 concerning escheatment or abandoned property1 or any analogous provision1 that might otherwise apply4 4 #cjc4 ,effective date 7a7 ,in general ,except as provided in subsection 7b71 this title and the amendments made by this title shall take effect on the date of the enactment of this ,act4 7b7 ,delayed effective date ,the effective date for paragraphs 7#e77;,b7 and 7#f77;,e7 of section #aad7;g7 of title #ag1 ,united ,states ,code1 as added by section #cjb1 shall be ,january #a1 #bjbj4