CRJs Propose Record Keeping Requirements for Webcasters

May 2, 2014. The Copyright Royalty Judges (CRJ) published a notice in the Federal Register (FR) announces, describes, recites, and requests comments on, proposed rules regarding "filing notice of use and the delivery of records of use of sound recordings under two statutory licenses of the Copyright Act". This pertains to "reports of use of sound recordings for the statutory licenses set forth in sections 112 and 114 of the Copyright Act". The CRJs also published a second notice in the FR that reaffirms the 2009 rules.

These notices are not clear for those not involved in this process. The CRJ proposes to revise its rules governing how digital music services (webcasters and others) must report the songs that they play to SoundExchange. This rulemaking is not about the important issue of rates. Rather, it is about the burdensome task of record keeping and reporting. SoundExchange wants much more data. The CRJs want public comments.

The deadline to submit initial comments is June 2, 2014. The deadline to submit reply comments is June 16, 2014.

David Oxenford (Wilkinson Barker Knauer) has written a more detailed summary of this CRJ FR notice.

Those who own copyrights in sound recording have a performance right for most but not all types of performances. Digital music services (webcasters and others) do not need to negotiate a license to perform sound recordings. The perform copyrighted sound recordings pursuant to the statutory licenses of Section 112 and 114 of the Copyright Act. The CRJ sets rates. Webcasters pay royalties to an intermediary (SoundExchange), which distributes money to rights holders.

The notice states that back on October 6, 2006 the CRJ released interim regulations. Then, on October 13, 2009, the CRJ released its final rule, "establishing requirements for census reporting for all but those broadcasters who pay no more than the minimum fee for their use of the license". See, notice in the FR, Vol. 74, No. 196, October 13, 2009, at Pages 52418-52427.

SoundExchange filed a petition for rulemaking on October 13, 2013. It is a performance rights organization (PRO) that represents sound recording copyright owners (SRCO), such as record companies, in the collection of performance royalties for digital performances under the statutory licenses codified at 17 U.S.C. § 112 and 17 U.S.C. § 114.

SoundExchange wants more data to be collected and reported. It also wants shorter deadlines for reports, and imposition of late fees.

Also, on October 28, 2009, the CRJ received a filing from the College Broadcasters, Inc. (CBI), American Council on Education (ACE), and Intercollegiate Broadcasting Systems, Inc. (IBSI). The CRJ states that the petitioners' description of this item as a petition for clarification is incorrect. It requests substantive changes, and is therefore a petition for rulemaking.

This is Docket No. 14-CRB-0005 (RM). See, FR, Vol. 79, No. 85, May 2, 2014, at Pages 25038-25049.

The CRJ also simultaneously published a second notice in the FR this states that its 2009 rules are reaffirmed. It did this because there has been litigation regarding various issues, including the Constitutionality of the manner in which the CRJs were appointed.

Hence, the notice recites the history of the rule, and the litigation, and then states that "In light of the foregoing proceedings, the Judges recognize the need to clarify the effectiveness of the final regulation. Consequently, the Judges performed a de novo review of the comments underlying the final regulation and affirm the adoption of this regulation as published at 74 FR 52418 on October 11, 2009, in its entirety and without change (including the reasons set forth in the preamble thereto), thereby removing any doubt as to the effectiveness of the final regulation. Such affirmation also ensures the continuous effectiveness of the rules concerning notice and recordkeeping for users of copyrighted sound recordings." (Parentheses in original.)

See, FR, Vol. 79, No. 85, May 2, 2014, at Pages 25009-25010. See also, July 6, 2012 opinion of the U.S. Court of Appeals (DCCir), IBSI v. Copyright Royalty Board, 684 F.3d 1332, holding that the manner by which the Judges were appointed was unconstitutional.

(Published in TLJ Daily E-Mail Alert No. 2,655, May 7, 2014.)