Orphaned Works Bill going through Congress

(I apologize for putting this here, I don't know where to put it... but this could have a huge impact on Second Life is enacted)

There is currently legislation going through the U.S. Congress (HR 5889) called the Orphaned Works Bill, which drastically changes copyright law for the worse.

If you are getting ripped off now, just wait...


To quote capwiz:

http://capwiz.com/illustratorspartnership/issues/bills/?billid=11320236

• The Orphan Works Act defines an "orphan work" as any copyrighted work whose author any infringer says he is unable to locate with what the infringer himself decides has been a "reasonably diligent search." In a radical departure from existing copyright law and business practice, the U.S. Copyright Office has proposed that Congress grant such infringers freedom to ignore the rights of the author and use the work for any purpose, including commercial usage. In the case of visual art, the word "author" means "artist."

• This proposal goes far beyond current concepts of fair use. As acknowledged by the Register of Copyrights it is not designed to deal with the special situations of non profit museums, libraries and archives. It is written so broadly that it will expose new works to infringement, even where the author is alive, in business, and licensing the work.

• The bill would substantially limit the copyright holder's ability to recover financially or protect the work, even if the work was registered with the U.S. Copyright Office prior to infringement.

• The bill has a disproportionate impact on visual artists because it is common for an artist's work to be published without credit lines or because credit lines can be removed by others for feckless or unscrupulous reasons. This is especially true of art published in the Internet Age.


If you are an American, you can contact your Senators and Congressmen this link:
http://capwiz.com/illustratorspartnership/issues/alert/?alertid=11442621

This again? How many times do the ignorant cries of "DOOM!" have to be debunked?

I've seen quite intelligent people on both sides of this issue.

Artists I respect trying to protect their future, and law-abiding librarians frustrated to death that they can't duplicate valuable last works to preserve them.

Along with any rule is interpretation, enforcement, and beaurocracy. I wish I knew how this one would turn out.

Ahh, Congressional overkill. How I love it.

This is similar in spirit (but not implementation) to what Larry Lessig suggested in terms of copyright expiration.

His argument was that works that are no longer "commercially viable" after a sufficient term (ie, 30 years) would require reregistration of copyright. In spirit, this would make several truly orphaned works fall in the public domain without harm or foul.


This, on the other hand, seems like the sort of vague and overambitious bill that would break many things. :|

The actual house bill will help clear things up here a bit:

http://thomas.loc.gov/cgi-bin/query/F?c110:1:./temp/~c110N60P0A:e908:

Among the qualifiers is that the infringer "performed and documented a qualifying search, in good faith, for the owner of the infringed copyright". In other words, s/he has to go to court and prove that the copyright owner could not be located. The bill even goes on to define what "diligent effort" consists of.

This is not simply a case of "any infringer says he is unable to locate with what the infringer himself decides has been a "reasonably diligent search", as quoted from capwiz.

There are a fair number of other clarifications present as well. The capwiz presentation of the bill is, as expected, biased, and a bit oversimplified. Reading the legislation should clear that up nicely.

Honestly, we don't know what a diligent search might be. At least in the copy of the bill I read (couldn't follow your link), what constitutes a 'diligent search' would really be left up to subsequent regulation by the Copyright Office.

I do not like the bill conceptually. A basic property right is the right to exclude others from using the property. This bill chips away at the exclusion right.

It is a better default rule that if you cannot locate the copyright holder, you cannot use the work. That's consistent with the exclusion right inherent in property.

I think this bill might be part of a larger movement to really whittle away at intellectual property rights in general. Technology has made the act of copying so darn cheap and easy, that everyone wants to be in the game of copying works. The mere copiers now far outnumber actual creators. The problem with the mere copiers driving policy is that they have no appreciation for how the work is actually created.

It may be true that copyright law is far behind the current technology. However, I don't think that the answer is to start chipping away at intellectual property rights. The answer, I think, is to make licensing easier.

Even if this bill itself may not be a horrible bill for intellectual property rights, it devalues the exclusion right, and paves the way for more chipping away at that right. Even if it might be good policy to pull back on some of the current intellectual property protections, I think that conceptually, intellectual property should always be treated with the same principles as the law treats other, tangible property.

But ideas are not real property. Once a person sees, hears, etc....... an idea, it is always theirs. You cannot take the copy from my mind, so you can't exclude me from that idea.


Michele Boldrin and David K.Levine put it this way:

http://www.dklevine.com/general/intellectual/coffee.htm

"All of this brings us to what intellectual property law is really about - a reality that is simply obscured by analogies to other types of property. Intellectual property law is not about your right to control your copy of your idea - this is a right that we have just pointed out, does not need a great deal of protection. What intellectual property law is really about is about your right to control my copy of your idea. This is not a right ordinarily or automatically granted to the owners of other types of property. If I produce a cup of coffee, I have the right to choose whether or not to sell it to you or drink it myself. But my property right is not an automatic right both to sell you the cup of coffee and to tell you how to drink it."

I agree that ideas are not property. But copyright doesn't cover mere ideas; it covers 'works,' unique experessions of ideas, in a tangible, identifiable form.

But the Orphan Work legislation, even though it may eventually lead to erosion of intellectual property, doesn't challenge the basic idea that intellectual property should be protected. For anyone who wants to see a more fundamental rewrite of copyright (and patent and trademark) law, the Orphan Work legislation isn't that rewrite.

Here is the main text of the legislation re: your query. It explains in detail what is required to show copyright ownership, what is required for a "diligent search", and so forth. It is not as simple, or as light-handed, as the article quoted made the legislation out to be - a common tactic, since most people don't bother to read legislation.

As you can see, the requirements are very specific.


=== snip ===

SEC. 2. LIMITATION ON REMEDIES IN CASES INVOLVING ORPHAN WORKS.

(a) Limitation on Remedies- Chapter 5 of title 17, United States Code, is amended by adding at the end the following:

`Sec. 514. Limitation on remedies in cases involving orphan works

`(a) Definitions- In this section, the following definitions shall apply:

`(1) MATERIALS AND STANDARDS- The term `materials and standards' includes--

`(A) the records of the Copyright Office that are relevant to identifying and locating copyright owners;

`(B) sources of copyright ownership information reasonably available to users, including private databases;

`(C) industry practices and guidelines of associations and organizations;

`(D) technology tools and expert assistance, including resources for which a charge or subscription fee is imposed, to the extent that the use of such resources is reasonable for, and relevant to, the scope of the intended use; and

` electronic databases, including databases that are available to the public through the Internet, that allow for searches of copyrighted works and for the copyright owners of works, including through text, sound, and image recognition tools.

`(2) NOTICE OF CLAIM FOR INFRINGEMENT- The term `notice of the claim for infringement' means, with respect to a claim for copyright infringement, a written notice that includes at a minimum the following:

`(A) The name of the owner of the infringed copyright.

`(B) The title of the infringed work, any alternative titles of the infringed work known to the owner of the infringed copyright, or if the work has no title, a description in detail sufficient to identify it.

`(C) An address and telephone number at which the owner of the infringed copyright may be contacted.

`(D) Information from which a reasonable person could conclude that the owner of the infringed copyright's claims of ownership and infringement are valid.

`(3) OWNER OF THE INFRINGED COPYRIGHT- The `owner of the infringed copyright' is the legal owner of the exclusive right under section 106 that is applicable to the infringement in question, or any party with the authority to grant or license that right.

`(4) REASONABLE COMPENSATION- The term `reasonable compensation' means, with respect to a claim for infringement, the amount on which a willing buyer and willing seller in the positions of the infringer and the owner of the infringed copyright would have agreed with respect to the infringing use of the work immediately before the infringement began.

`(b) Conditions for Eligibility-

`(1) CONDITIONS-

`(A) IN GENERAL- Notwithstanding sections 502 through 505, and subject to subparagraph (B), in a civil action brought under this title for infringement of copyright in a work, the remedies for infringement shall be limited in accordance with subsection (c) if the infringer--

`(i) proves by a preponderance of the evidence that before the infringement began, the infringer, a person acting on behalf of the infringer, or any person jointly and severally liable with the infringer for the infringement--

`(I) performed and documented a qualifying search, in good faith, for the owner of the infringed copyright; and

`(II) was unable to locate the owner of the infringed copyright;

`(ii) before using the work, filed with the Register of Copyrights a Notice of Use under paragraph (3);

`(iii) provided attribution, in a manner that is reasonable under the circumstances, to the owner of the infringed copyright, if such owner was known with a reasonable degree of certainty, based on information obtained in performing the qualifying search;

`(iv) included with the use of the infringing work a symbol or other notice of the use of the infringing work, in a manner prescribed by the Register of Copyrights;

`(v) asserts in the initial pleading to the civil action the right to claim such limitations;

`(vi) consents to the jurisdiction of United States district court, or such court holds that the infringer is within the jurisdiction of the court; and

`(vii) at the time of making the initial discovery disclosures required under Rule 26 of the Federal Rules of Civil Procedure, states with particularity the basis for the right to claim the limitations, including a detailed description and documentation of the search undertaken in accordance with paragraph (2)(A).

`(B) EXCEPTION- Subparagraph (A) does not apply if, after receiving notice of the claim for infringement and having an opportunity to conduct an expeditious good faith investigation of the claim, the infringer--

`(i) fails to negotiate reasonable compensation in good faith with the owner of the infringed copyright; or

`(ii) fails to render payment of reasonable compensation in a reasonably timely manner.

`(2) REQUIREMENTS FOR SEARCHES-

`(A) REQUIREMENTS FOR QUALIFYING SEARCHES-

`(i) IN GENERAL- For purposes of paragraph (1)(A)(i)(I), a search is qualifying if the infringer undertakes a diligent effort to locate the owner of the infringed copyright.

`(ii) DETERMINATION OF DILIGENT EFFORT- In determining whether a search is diligent under this subparagraph, a court shall consider whether--

`(I) the actions taken in performing that search are reasonable and appropriate under the facts relevant to that search, including whether the infringer took actions based on facts uncovered by the search itself;

`(II) the infringer employed the applicable best practices maintained by the Register of Copyrights under subparagraph (B); and

`(III) the infringer performed the search before using the work and at a time that was reasonably proximate to the commencement of the infringement.

`(iii) LACK OF IDENTIFYING INFORMATION- The fact that a particular copy or phonorecord lacks identifying information pertaining to the owner of the infringed copyright is not sufficient to meet the conditions under paragraph (1)(A)(i)(I).

`(B) INFORMATION TO GUIDE SEARCHES; BEST PRACTICES-

`(i) STATEMENTS OF BEST PRACTICES- The Register of Copyrights shall maintain and make available to the public, including through the Internet, current statements of best practices for conducting and documenting a search under this subsection.

`(ii) CONSIDERATION OF RELEVANT MATERIALS AND STANDARDS- In maintaining the statements of best practices required under clause (i), the Register of Copyrights shall, from time to time, consider materials and standards that may be relevant to the requirements for a qualifying search under subparagraph (A).

`(3) NOTICE OF USE ARCHIVE- The Register of Copyrights shall create and maintain an archive to retain the Notice of Use filings under paragraph (1)(A)(i)(III). Such filings shall include--

`(A) the type of work being used, as listed in section 102(a) of this title;

`(B) a description of the work;

`(C) a summary of the search conducted under paragraph (1)(A)(i)(I);

`(D) the owner, author, recognized title, and other available identifying element of the work, to the extent the infringer knows such information with a reasonable degree of certainty;

` a certification that the infringer performed a qualifying search in good faith under this subsection to locate the owner of the infringed copyright; and

`(F) the name of the infringer and how the work will be used.

Notices of Use filings retained under the control of the Copyright Office shall be furnished only under the conditions specified by regulations of the Copyright Office.

`(4) PENALTY FOR FAILURE TO COMPLY- If an infringer fails to comply with any requirement under this subsection, the infringer is subject to all the remedies provided in section 502 through 505, subject to section 412.

`(c) Limitations on Remedies- The limitations on remedies in a civil action for infringement of a copyright to which this section applies are the following:

`(1) MONETARY RELIEF-

`(A) GENERAL RULE- Subject to subparagraph (B), an award for monetary relief (including actual damages, statutory damages, costs, and attorney's fees) may not be made other than an order requiring the infringer to pay reasonable compensation to the legal or beneficial owner of the exclusive right under the infringed copyright for the use of the infringed work.

`(B) FURTHER LIMITATIONS- An order requiring the infringer to pay reasonable compensation for the use of the infringed work may not be made under subparagraph (A) if the infringer is a nonprofit educational institution, library, or archives, or a public broadcasting entity (as defined in subsection (f) of section 11 and the infringer proves by a preponderance of the evidence that--

`(i) the infringement was performed without any purpose of direct or indirect commercial advantage,

`(ii) the infringement was primarily educational, religious, or charitable in nature, and

`(iii) after receiving notice of the claim for infringement, and after conducting an expeditious good faith investigation of the claim, the infringer promptly ceased the infringement,

except that if the legal or beneficial owner of the exclusive right under the infringed copyright proves, and the court finds, that the infringer has earned proceeds directly attributable to the infringement, the portion of such proceeds so attributable may be awarded to such owner.

`(C) EFFECT OF REGISTRATION ON REASONABLE COMPENSATION- If a work is registered, the court may, in determining reasonable compensation under this paragraph, take into account the value, if any, added to the work by reason of such registration.

`(2) INJUNCTIVE RELIEF-

`(A) GENERAL RULE- Subject to subparagraph (B), the court may impose injunctive relief to prevent or restrain any infringement alleged in the civil action.

`(B) EXCEPTION- In a case in which the infringer has prepared or commenced preparation of a work that recasts, transforms, adapts, or integrates the infringed work with a significant amount of the infringer's original expression, any injunctive relief ordered by the court--

`(i) may not restrain the infringer's continued preparation or use of that new work;

`(ii) shall require that the infringer pay reasonable compensation to the legal or beneficial owner of the exclusive right under the infringed copyright for the use of the infringed work; and

`(iii) shall require that the infringer provide attribution, in a manner that is reasonable under the circumstances, to the owner of the infringed copyright, if requested by such owner.

`(C) LIMITATIONS- The limitations on injunctive relief under subparagraphs (A) and (B) shall not be available to an infringer if the infringer asserts in the civil action that neither the infringer or any representative of the infringer acting in an official capacity is subject to suit in the courts of the United States for an award of damages to the legal or beneficial owner of the exclusive right under the infringed copyright under section 106, unless the court finds that the infringer--

`(i) has complied with the requirements of subsection (b); and

`(ii) has made an enforceable promise to pay reasonable compensation to the legal or beneficial owner of the exclusive right under the infringed copyright.

`(D) RULE OF CONSTRUCTION- Nothing in subparagraph (C) shall be construed to authorize or require, and no action taken under such subparagraph shall be deemed to constitute, either an award of damages by the court against the infringer or an authorization to sue a State.

` RIGHTS AND PRIVILEGES NOT WAIVED- No action taken by an infringer under subparagraph (C) shall be deemed to waive any right or privilege that, as a matter of law, protects the infringer from being subject to suit in the courts of the United States for an award of damages to the legal or beneficial owner of the exclusive right under the infringed copyright under section 106.

`(d) Exclusion for Fixations in or on Useful Articles- The limitations on monetary and injunctive relief under this section shall not be available to an infringer for infringements resulting from fixation of a work in or on a useful article that is offered for sale or other distribution to the public.

` Preservation of Other Rights, Limitations, and Defenses- This section does not affect any right, limitation, or defense to copyright infringement, including fair use, under this title. If another provision of this title provides for a statutory license that would permit the infringement contemplated by the infringer if the owner of the infringed copyright cannot be located, that provision applies instead of this section.

`(f) Copyright for Derivative Works and Compilations- Notwithstanding section 103(a), an infringer who qualifies for the limitation on remedies afforded by this section with respect to the use of a copyrighted work shall not be denied copyright protection in a compilation or derivative work on the basis that such compilation or derivative work employs preexisting material that has been used unlawfully under this section.'.

(b) Technical and Conforming Amendment- The table of sections for chapter 5 of title 17, United States Code, is amended by adding at the end the following:

`514. Limitation on remedies in cases involving orphan works.'.

SEC. 3. DATABASE OF PICTORIAL, GRAPHIC, AND SCULPTURAL WORKS.

(a) Establishment of Database-

(1) IN GENERAL- The Register of Copyrights shall undertake a certification process for the establishment of an electronic database to facilitate the search for pictorial, graphic, and sculptural works that are subject to copyright protection under title 17, United States Code.

(2) PROCESS AND STANDARDS FOR CERTIFICATION- The process and standards for certification of the electronic database required under paragraph (1) shall be established by the Register of Copyrights, except that certification may not be granted if the electronic database does not contain--

(A) the name of all authors of the work, and contact information for any author if the information is readily available;

(B) the name of the copyright owner if different from the author, and contact information of the copyright owner;

(C) the title of the copyrighted work, if such work has a title;

(D) with respect to a copyrighted work that includes a visual image, a visual image of the work, or, if such a visual image is not available, a description sufficient to identify the work;

one or more mechanisms that allow for the search and identification of a work by both text and image; and

(F) security measures that reasonably protect against unauthorized access to, or copying of, the information and content of the electronic database.

(b) Public Availability- The Register of Copyrights--

(1) shall make available to the public through the Internet a list of all electronic databases that are certified in accordance with this section; and

(2) may include any database so certified in a statement of best practices established under section 514(b)(5)(B) of title 17, United States Code.

SEC. 4. EFFECTIVE DATE.

(a) In General- With respect to works other than pictorial, graphic, and sculptural works, the amendments made by section 2 shall apply to infringements that commence on or after January 1, 2009.

(b) Pictorial, Graphic, and Sculptural Works- With respect to pictorial, graphic, and sculptural works, the amendments made by section 2 shall--

(1) take effect on the earlier of--

(A) the date on which the Copyright Office certifies under section 3 at least 2 separate and independent searchable, comprehensive, electronic databases, that allow for searches of copyrighted works that are pictorial, graphic, and sculptural works, and are available to the public through the Internet; or

(B) January 1, 2013; and

(2) apply to infringing uses that commence on or after that effective date.

(c) Publication in Federal Register- The Register of Copyrights shall publish the effective date described in subsection (b)(1) in the Federal Register, together with a notice that the amendments made by section 2 take effect on that date with respect to pictorial, graphic, and sculptural works.

(d) Definition- In this section, the term `pictorial, graphic, and sculptural works' has the meaning given that term in section 101 of title 17, United States Code.

SEC. 5. REPORT TO CONGRESS.

Not later than December 12, 2014, the Register of Copyrights shall report to the Committee on the Judiciary of the Senate and the Committee on the Judiciary of the House of Representatives on the implementation and effects of the amendments made by section 2, including any recommendations for legislative changes that the Register considers appropriate.

SEC. 6. STUDY ON REMEDIES FOR SMALL COPYRIGHT CLAIMS.

(a) In General- The Register of Copyrights shall conduct a study with respect to remedies for copyright infringement claims by an individual copyright owner or a related group of copyright owners seeking small amounts of monetary relief, including consideration of alternative means of resolving disputes currently heard in the United States district courts. The study shall cover the infringement claims to which section 514 of title 17, United States Code, apply, and other infringement claims under such title 17.

(b) Procedures- The Register of Copyrights shall publish notice of the study required under subsection (a), providing a period during which interested persons may submit comments on the study, and an opportunity for interested persons to participate in public roundtables on the study.


=== snip ===

Where you see detail, I see vague guidance to the Copyright Office to develop standards about best practices.

Worrying about if ideas are property is about like worrying if you can really 'own' your yard, because, well, you are gonna die someday and your yard is probably still going to be there.

The point about ownership is control.

That cup of coffee he's talking about - say I stole it from him and drank it. He's not getting it back; it's mine forever! And so? It was still his in the first place, he created it and I took it.

Except that you didn't deprive him of his cup of coffee. He still has his cup, and is not being deprived of anything but his right to control who can make a copy. He has lost nothing materially, in a typical property sense. That right of control is an artificial creation of scarcity on the concept of ideas in general. Basically, since you cannot really prevent someone from obtaining information and knowledge via presentation, and thus, make it a "scarce" or "consumable" resource, society has created an artificial form of it to encourage people to share what they have invented "from thin air", and to continue to do so.

The problem lies in the fact that large corporate interests have paid for the gross extension of the concept so they can line their already bursting treasuries with more platinum, gleaned from the commons. That is the real tragedy, since Copyright law originally was not meant for such things, and the people who framed it were well aware of how it could be abused (which is what makes Jefferson such a visionary, since he more or less predicted this mess in his warnings). Originally, Copyright Law gave 14 years from time of creation, and allowed for ONE extension of another 14 years. For ONE work.

A lot of very intelligent people will undoubtedly point out that IP law is necessary to promote the Arts and Sciences, by inducing others to create new and unique things, but those who have fostered the gross overextension of what originally was a very good, working system at its inception have overlooked two very important things:

1) That creation is not from a vacuum; everything that is created by man is a product of his experiences, focused through the lens of his genius, colored by his imagination, and is thus, in great part, owing much to the commons from which the creation was sourced.

2) That the law is ALSO meant to induce the same people who use it to continue creating and innovating, and not suckling off of the teat of the commons indefinitely, nor becoming a legacy supporting one's offspring.

Of course, that is to be expected from capitalist entities. They lose sight of EVERYTHING but their fixation on one thing: profit. That's why corporate regulation is a necessity, for the same reason that we have rules and laws for people; because people naturally take more than their fair share of things, even and especially to the detriment of their neighbors and peers. People at least have a chance at having a conscience and being convinced of the evil of their ways; however, corporations don't have that quality. They are machines, plain and simple, despite the fact that there are people behind the masks.

Sure, you may not deprive that fellow of his own coffee - but his coffee shop is history if anyone can take his coffee.

Corporations often don't act 'morally' per se, but they can and are held to accountability under the law and so forth.

I think our expectations have to match - there should be outrage when a corporation is operated in an unethical manner.

If you think that sort of thing is bad now, just wait and see what would happen were this orphan works bill were to become law. Because it requires registration of works, which would cost a fee, the only ones who'd be able to afford to copyright very much of anything would be big corporations. Copyright would then become the domain of the few and the privileged. Everyone else would lose the automatic protections we've always had. This issue could not be more serious.

This bit is addressed in the bill:

" '(iii) LACK OF IDENTIFYING INFORMATION- The fact that a particular copy or phonorecord lacks identifying information pertaining to the owner of the infringed copyright is not sufficient to meet the conditions under paragraph (1)(A)(i)(I).

(1)(A)(i)(I) performed and documented a qualifying search, in good faith, for the owner of the infringed copyright; "

Any changes to copyright does need a lot of thought as you say, so I just encourage artists and creators to engage themselves in the debate before it does become law.

What does this mean in terms of stuff like Starax's works? How are objects protected if the virtual creator 'dies' and gets reincarnated?

/me understands that this may be a horribly stupid question.

My read on the bill is that it tightens ownership of copyright, and adds a compliance cost on creators in return for this.

When you create, or claim creation, of a work then before you release it as your own then you will have to do a due diligence search for other similar work if you're hoping to profit from what you've made. And on finding prior art that your work duplicates then you're going to have to come to an arrangement with the prior creator if your work is not to be binned.

It is my belief that every opinion given in this thread against this bill is mearly due to a mis-understanding of it.

Not everyone can read legal writing well.

Those of you that think this will harm digital media where credits are often not accompanying the work do not have to worry. The bill in fact anticipates this problem and covers it reasonably well.

True, but I think you miss one of the important points that the analogy made. It's not so much about /how/ you got the cup of coffee, but what you can do with it once you have it. At some level, there is "proper control of artificial scarcity", which attempts to legitimately do things like prevent you from opening your own coffee shop and selling his coffee. However, of late, we also get ridiculous controls over it, such as "you can only consume it on Tuesday, holding the cup with your left hand, and with your left pinky raised as you drink it." Especially since EULAs and ToSs are now being treated as direct extensions of copyright law by the courts.



Except that unethical rarely translates into "illegal", especially when corporations have bought and paid for laws to make it so.

As for outrage, there is plenty. When Disney got their sock puppet Sonny Bono to help keep the original Mickey Mouse character from falling into the public domain, there was a great upwelling of angst and woe over it from many noted legal scholars, as well as from significant segments of the public at-large. It has happened numerous times in all segments of IP law in the US and abroad. However, the outrage doesn't translate to anything because people are too often mindless sheep and keep telling the lawmakers how good a job they are doing by voting them (or their party cronies) back into office again and again to do the same thing.

I think you need to breathe into a bag for a minute to curb your hyperventilation.

There's nothing in the law which says that registration of works with the COPYRIGHT office is a requirement for protection and remedy. The "natural copyright" clauses are not amended by the new law in any way.

What this amounts to is this:

1) Entity A finds a work, X, that they would like to use.
2) Entity A does an extensive, detailed search, using many different sources of ownership information (not merely the LOC copyright registration database, but even things like Google and other private informations sources) for work X to find the owner to contact for licensing.
3) Failing the due diligence search, Entity A files a notice with the copyright office with an "Intent to Use" Work X according to the requirements of the statute.
3) Entity B, the owner of the work in question, discovers the unauthorized use of Work X by Entity A, and follows a normal procedure to have Entity A enjoined to stop using Work X, potentially looking to secure damages.
4) Entity A responds with the "Intent to Use" notice, filed with the Copyright office, considering the work "orphaned".
5) Once the ownership of the work is verified as Entity B, Entity A must then enter into good faith negotiations with Entity B for compensation of its use of Work X.
6) Failing that, on Entity A's part, Entity B can then proceed with a normal infringement suit to collect damages and enjoin Entity A from using the work further.

What is the real impact? Either way, the owner of a declared "orphan" work via this process is STILL due compensation if he/she desires, plus now there is a legal notification that said work IS being used, which can be more easily discovered by the owner. If you make your work available publicly or place ANY identifying information within it at all, then it becomes a non-issue, since you can prove that they didn't perform a true due-diligence search for you as the owner.

More than anything, it is asking people who are using "orphaned" works to actually make some effort and to notify the public that they are using said works, rather than just "infringing in secret" and letting the owners spend their lifetimes looking for them. At least, with this change, owners can track them down easier, and can still negotiate compensation in good faith.

Overall, I think it is a plus.