The function of “otherwise” in statutory interpretation

A bill is making its way through the Senate. The Judiciary Committee staff just released a summary of changes, and I’m wrestling with one of the clauses.

The clause is:
“The safe harbor for damages has been modified in [that] it strikes the language specifying that entities otherwise falling under the safe harbor pay reasonable compensation on any proceeds they earned from the [act].”

What how does the word “otherwise” function in the clause?

It seems to say that in an earlier version of the act, entities that fell under the safe harbor provisions didn’t have to pay compensation. The changes removed that particular protection (i.e., they now have to pay compensation, irrespective of other safeguards the provision grants).

If so, why use “otherwise”? Does it add or change the meaning?

Oh, there is no legal jeopardy involved in this question – it has to do with an article we’re working on.
Thanks,

Rhythmdvl
(
I’ve been up for about 30-odd hours working on an unrelated project, so I’m a bit fuzzy—please forgive me if this is obvious.)

I would have thought it said the exact opposite. The entities in question previously had to pay compensation even though (“otherwise”) they fell under the safe harbor. Now that that clause is being struck they presumably no longer have to pay.

Needless to say, IANAL of any species - American, Canadian, or otherwise.

Man, am I fried. If they’re saying that the clause that required entities to pay has been struck, wouldn’t they have dropped the otherwise?

That is:
“The safe harbor for damages has been modified in [that] it strikes the language specifying that entities falling under the safe harbor pay reasonable compensation on any proceeds they earned from the [act].”

This says:[ul]
[li]The safe harbor clause has been changed[/li][li]The change removed certain language[/li][li]The language that was removed specified that entities falling under the safe harbor had to pay[/li][li]Now, entities under the safe harbor don’t have to pay [/ul][/li]
It’s much more likely that I’m missing something obvious than it’s just a linguistic flourish, but damned if I can see it.

I just looked up the bill on Govtrack (told you I was fried—I should have bypassed the staff report a while ago).

The safe harbor bit said that nonprofits did not have to pay basic compensation for use of materials.

The exception to the safe harbor said that they did have to pay compensation if they made a profit from the use of the materials.

The exception was struck.

I still don’t get why the staff report used “otherwise,” but I need to go to sleep.

I think the ‘otherwise’ was to emphasize that the payment requirement was a specific exception to the general safe harbor, and that the affected non-profits were still covered by the safe harbor in all other ways.

So a rewriting would be something like:
‘… that entities falling under the safe harbor in most ways have a specific exception where they must pay compensation …’

This means: if an entity has met all requirements for safe harbor, except the requirement that it pay reasonable compensation for proceeds it earned from the act in question, that entity is still entitled to safe harbor, because the clause requiring an otherwise-qualified entity to pay damages before it is entitled to safe harbor has been stricken.

In this case, “otherwise” could be revised (and moved in the sentence) to read “in all other regards”. Hope that helps.