[Federal Register: December 2, 1996 (Volume 61, Number 232)]
[Rules and Regulations]
[Page 63715-63718]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Parts 251, 252, 257, and 259
[Docket No. RM 94-1A]
Copyright Arbitration Royalty Panels; Rules and Regulations
AGENCY: Copyright Office, Library of Congress.
ACTION: Technical amendments.
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SUMMARY: On December 7, 1994, the Copyright Office of the Library of
Congress published final regulations governing the administration of
royalty fee distribution proceedings and royalty rate adjustment
proceedings for the statutory licenses. Over the past eighteen months,
the Office tested these rules and identified areas which required minor
adjustments or clarification. This notice makes non-substantive
technical amendments to correct the identified problems.
EFFECTIVE DATE: January 2, 1997.
FOR FURTHER INFORMATION CONTACT: Marilyn J. Kretsinger, Acting General
Counsel, or Tanya M. Sandros, CARP Specialist, Copyright Arbitration
Royalty Panel, P.O. Box 70977, Southwest Station, Washington, D.C.
20024. Telephone: (202) 707-8380. Telefax: (202) 707-8366.
SUPPLEMENTARY INFORMATION: The Copyright Office (``Office'') of the
Library of Congress issued the current regulations, see 37 CFR chapter
II, subchapter B, governing the Copyright Arbitration Royalty Panels
(``CARP'') after an extensive rulemaking which began with a notice of
proposed rulemaking, 59 FR 2550 (January 18, 1994), and concluded with
the publication of the final regulations on December 7, 1994. 59 FR
63025 (December 7, 1994). During 1995 and 1996, these rules were used
to conduct a CARP proceeding to determine the distribution of the 1990,
1991, and 1992 cable royalties; to initiate a second CARP proceeding to
determine the distribution of the 1992, 1993, and 1994 digital audio
recording technology (DART) royalties in the Musical Works Funds; and
to set the schedule for four rate setting proceedings.
In using the CARP rules to administer these proceedings, the Office
identified some minor problems with the application of the current
rules, which these non-substantive technical amendments correct. The
amendments clarify ambiguous sections, harmonize discordant rules, and
streamline the process, when possible, based on the experience gleaned
over the past eighteen months.
Official Address
During the course of a CARP proceeding, interested parties file
pleadings with the Copyright Office and the CARP. Although many of
these pleadings are filed with the Copyright Office prior to the
initiation of the CARP, the regulations do not instruct the parties
where to file the pleading at the Copyright Office, if hand delivered.
Therefore, Sec. 251.1 is amended to address this omission by adding the
official address of the Office of the Copyright General Counsel.
List of Arbitrators
The Librarian of Congress selects arbitrators for a CARP from a
list of names generated from the nominations submitted to him by at
least three professional arbitration associations. Section 251.3(a)
allows the arbitration associations to submit new names each year and
Sec. 251.3(b) requires the Librarian to publish a list of qualified
nominees after January 1 of each year.
The annual solicitation of new names from at least three
arbitration associations and the review of the financial disclosure
forms from the nominees, however, requires substantial time and effort
on the part of the Librarian of Congress, the Copyright Office, and the
nominating organizations. Likewise, the parties to a proceeding expend
considerable time and expense in examining the background material for
each potential arbitrator in preparing their objections under
Sec. 251.4 to listed arbitrators. But in spite of all the preliminary
work, very few individuals on the list actually will have an
opportunity to serve on a panel. In 1995, three individuals from a list
of 77 names were chosen to serve on a single panel; and this year, no
more than six individuals from a list of 36 nominees will be chosen to
serve as a CARP arbitrator.
In consideration of the relatively small probability of using more
than a handful of names from the list in any given year, the Office
cannot justify the disproportionate amount of time and expense expended
by the nominating
[[Page 63716]]
associations, the parties, or itself in generating and reviewing an
annual list. Therefore, the rule is amended to reflect a two year cycle
for generating a new list.
Qualifications of the Arbitrators
Section 251.5(c), which quotes the statutory requirements for an
arbitrator under consideration for service on a CARP, mistakenly uses
an ``or'' in place of ``and.'' This amendment corrects the
typographical error.
Financial Disclosure Forms
Section 251.32(a), which allows a nominated arbitrator to file a
financial disclosure form with the Librarian of Congress up to one
month after the publication of the list of nominees in the Federal
Register, is amended and now requires a nominated arbitrator to file
the financial disclosure form no later than 45 days after the
arbitration association submits the candidate's name to the Librarian
of Congress. This amendment will allow the Librarian of Congress to
compile a list for publication in the Federal Register that includes
only those names of nominees who show a clear interest in serving on
the panels through their submission of a completed financial disclosure
form.
Currently, Sec. 251.32(b)(2)(ii) requires the Librarian to publish
in the order establishing the precontroversy discovery schedule a list
of potential financial conflicts which the listed arbitrators have
agreed to disclose. This list of conflicts, however, need not be
published in the Federal Register or even simultaneously with the order
setting the precontroversy discovery schedule. Therefore,
Sec. 251.32(b)(2)(ii) is amended by removing the specific reference to
publication in the order establishing the period for precontroversy
motions.
A typographical error exists in Sec. 251.32(d). In the third clause
of the first sentence, the word ``any'' is a mistake; the clause should
read ``if there are no changes in the arbitrator's financial
interests,''.
Written Cases
Section 251.43(a) requires participants to file direct cases with
the Copyright Arbitration Royalty Panel when, in fact, a panel may not
have been selected at the moment in the proceeding when direct cases
are due. Therefore, the amended rule requires the participants to file
their direct cases with the Copyright Office.
Filing and Service of Written Cases and Pleadings
The bifurcation of the responsibilities for a CARP proceeding
between the Library and the arbitration panel generated considerable
confusion concerning the number of copies to be filed with the panel
and with the Copyright Office. Therefore, the current filing
requirements articulated in Secs. 251.44(a) and 251.44(b) are combined
into a single regulation which addresses all the filing requirements
related to a CARP proceeding. The new regulation instructs participants
to deliver an original and five copies to the Copyright Office for
further distribution to the CARP, unless otherwise instructed by the
Librarian of Congress or the CARP. This change eliminates the confusion
engendered by the two filing requirements described in the current
Secs. 251.44(a) and 251.44(b).
Additionally, a new Sec. 251.44(b) contains the information
pertaining to the filing of exhibits which had been in Sec. 251.44(a).
The information concerning the filing of exhibits remains the same and
is moved to a separate section merely for clarification purposes.
Currently, Sec. 251.44(e)(2) requires a party not represented by
counsel to sign and verify all documents filed in a proceeding. Since
the party's signature constitutes certification by the signing party
that to the best of his or her knowledge and belief there are good
grounds to support the filing, the rule is amended to require only the
party's signature.
Section 251.44(f) is amended by removing redundant references to
the Library of Congress, the Copyright Office, and the CARP, since
parties will file all pleadings with the Copyright Office, as required
under the new Sec. 251.44(a).
Section 251.44(g) is also amended to harmonize the time for filing
oppositions and replies with the filing requirements specified in
Sec. 251.45(b), and now requires all oppositions be filed within seven
business days of the filing of the motion. Additionally, the language
referring to the date of service has been removed, because the filing
date of the motion or opposition is the relevant date for determining
the appropriate response date. Each party, however, must make service
of all motions, petitions, objections, oppositions, and replies on the
other parties or their counsel by means no slower than overnight
express mail on the same day the pleading is filed.
Discovery and Prehearing Motions
Sections 251.45(b)(1)(i) and (b)(2)(i) are amended and will allow
parties to file replies to a response within five business days of the
filing of the response. Additionally, the amendment clarifies that the
seven-day period specified for filing responses to a pleading refers to
business days. This correction creates a consistent time frame for
filing CARP documents, and removes the distinction between a pleading
cycle within a 45-day precontroversy period and a pleading cycle at any
other time.
Sections 251.45(b)(1)(i) and (b)(2)(i) is amended further to state
that each party must effect actual delivery of a complete copy of its
written direct case on each party, no later than the first day of the
45-day precontroversy discovery period.
Consideration of Petition; Settlement
Historically, parties in a rate setting proceeding have engaged in
a period of negotiation before the initiation of formal hearings.
Section 251.63(a) continues this tradition, but refers to the 30-day
negotiation period as a ``period for consideration for their
settlement.'' To avoid any confusion arising from this language, the
amended section now reads ``a 30-day period for negotiation of a
settlement.''
Filing of Claims
Each year, the Copyright Office receives claims for cable
compulsory license fees, for compulsory license fees for secondary
transmissions by satellite carriers, and for statutory license fees for
digital audio recording technology and media distributed in the United
States. The Copyright Act defines the filing period for each license,
see 17 U.S.C. 111(d)(4)(A), 119(b)(4)(A) and 1007(a)(1), but the
regulations define the parameters for compliance with the statutory
dates. See 37 CFR 252.4(e), 257.4(e), and 259.5(e).
Specifically, the rules allow a party to provide a receipt from the
U.S. Postal Service which shows that the claim was properly mailed, and
therefore, properly filed. Properly mailed, however, means both that a
claim has a correct address and that it is mailed during the
appropriate time period. The only acceptable proof of a timely filing,
however, is the certified mail return receipt bearing a U.S. Postal
Service mark demonstrating that the mailing occurred during the
relevant time period to the appropriate address. Therefore, the word
``mailed'' in the phrase, ``a claimant may nonetheless prove that the
claim was properly mailed,'' is being replaced with the word ``filed''
as a means of clarifying the language in all the regulatory sections
which discuss proof of a timely filing. Additionally, the amended rule
states
[[Page 63717]]
specifically that the receipt must bear a July date stamp of the U. S.
Postal Service, except where paragraph (b) of the section applies, when
the claim is filed under Secs. 252.4(e) or 257.4(e), or a January or
February date stamp of the U.S. Postal Service, except where paragraph
(b) of the section applies, when the claim is filed under
Sec. 259.5(e), before the Office will accept the receipt as proof of a
timely filed claim.
Authorizations for DART Claimants
On December 1, 1995, the Office published a final rule which
specified the nature of the authorization which an organization acting
as a common agent must obtain before making a claim for DART fees on
behalf of its members and affiliates. 60 FR 61657 (December 1, 1995).
The rule also included two limited exceptions to the rule requiring
separate, specific, and written authorization. These exceptions were
available to all organizations acting as a common agent on behalf of
its members.
On December 19, 1995, and again on February 1, 1996, in letters to
the Copyright Office, the Alliance of Artists and Recording Companies
(``AARC'') voiced its concern that the new rule could create confusion,
rather than reduce it, where a claimant, whose interests were
represented by different organizations, asserted a claim in both the
Sound Recordings Fund and the Musical Works Fund. Initially, the
performance rights organizations strongly opposed AARC's proposal to
change the rule. Joint Letter from ASCAP, BMI, Inc. and SESAC, Inc.
dated January 24, 1995. These parties, however, pursued further
discussions concerning the potential problems associated with the
exceptions in Sec. 259.2(c); and on June 4, 1996, ARCC and the
performance rights organizations announced that they had reached
agreement upon a proposed change that would address AARC's concerns. As
all known parties affected by the proposed limitation on the exceptions
agree to the proposed change, Sec. 259.2(c) is amended accordingly.
Under the amended rule, an organization acting as a common agent can
take advantage of the exceptions to the rule requiring written,
separate, and specific authorization only when it files a claim to the
Musical Works Fund.
List of Subjects
37 CFR Part 251
Administrative practice and procedure, Hearing and appeal
procedures.
37 CFR Part 252
Cable television, Claims, Copyright.
37 CFR Part 257
Claims, Copyright, Satellites.
27 CFR Part 259
Claims, Copyright, Digital audio recordings devices and media.
Accordingly, 37 CFR chapter II is corrected by making the following
corrections and amendments.
PART 251--COPYRIGHT ARBITRATION ROYALTY PANEL RULES AND PROCEDURES
1. The authority citation for part 251 continues to read as
follows:
Authority: 17 U.S.C. 801-803.
2. Section 251.1 is revised to read as follows:
Sec. 251.1 Official addresses.
Claims, pleadings, and general correspondence should be addressed
to:
Copyright Arbitration Royalty Panel (CARP), P.O. Box 70977, Southwest
Station, Washington, DC 20024
or, hand-delivered to:
Office of the Copyright General Counsel, Room 403, James Madison
Building, 101 Independence Avenue, S.E., Washington, DC 20540
Sec. 251.3 Arbitration lists. [Amended]
3. In
Sec. 251.3(a) introductory text, the phrase ``of each year''
is removed and the phrase ``, 1998, and every two years thereafter'' is
added after the phrase ``before January 1''.
4. In Sec. 251.3(b), the phrase ``of each year,'' is removed and
the phrase ``, 1998, and every two years thereafter'' is added after
the phrase ``after January 1''.
Sec. 251.5 Qualifications of the arbitrators. [Corrected]
5. In Sec. 251.5(c), the word ``or'' is removed and the word
``and'' is added before the word ``facilitating''.
6. In Sec. 251.32, paragraphs (a) and (b)(2)(ii) are revised to
read as follows:
Sec. 251.32 Financial disclosure statement.
(a) Within 45 days of their nomination, each nominated arbitrator
shall file with the Librarian of Congress a confidential financial
disclosure statement as provided by the Library of Congress, which
statement shall be reviewed by the Librarian and designated Library
staff to determine what conflicts of interest, if any, exist according
to Sec. 251.31.
(b) * * *
(2) * * *
(ii) Such list shall be included in an order issued no later than
the commencement of the 45-day precontroversy discovery period;
* * * * *
7. Section 251.32(d) is corrected by removing the word ``any'' in
the phrase ``if there are any changes in the arbitrator's financial
interests,'' and adding the word ``no'' before the word ``changes'' in
the same phrase.
Sec. 251.43 Written cases. [Amended]
8. Section 251.43(a) is amended by removing the phrase ``Copyright
Arbitration Royalty Panel'' and adding ``Copyright Office'' in its
place.
9. In Sec. 251.44, paragraphs (a), (b), (e)(2), (f) and (g) are
revised to read as follows:
Sec. 251.44 Filing and service of written cases and pleadings.
(a) Filing of pleadings. In a royalty fee distribution proceeding
or in a rate adjustment proceeding, the submitting party shall deliver
an original and five copies of all filings to the Copyright Office at
the address listed in Sec. 251.1, unless otherwise instructed by the
Librarian of Congress or the CARP. The Copyright Office will make
further distribution to the CARP, as necessary. In no case shall a
party tender any written case or pleading by facsimile transmission.
(b) Exhibits. All exhibits must be included with a party's case;
however, in the case of exhibits whose bulk or whose cost of
reproduction would unnecessarily encumber the record or burden the
party, the Librarian of Congress or the CARP may reduce the number of
required copies. Nevertheless, a complete copy must still be submitted
to the Copyright Office.
* * * * *
(2) The original of all documents filed by a party not represented
by counsel shall be signed by that party and list that party's address
and telephone number.
* * * * *
(f) The Librarian of Congress shall compile and distribute to those
parties who have filed a notice of intent to participate, the official
service list of the proceeding, which shall be composed of the names
and addresses of the representatives of all the parties to the
proceeding. In all filings, a copy shall be served upon counsel of all
other parties identified in the service list, or, if the party is
unrepresented by counsel, upon the party itself. Proof of service shall
accompany the filing. Parties shall notify the Librarian of any change
in the name or address to which service shall be made, and shall serve
a copy of such notification on all parties and the CARP.
[[Page 63718]]
(g) Oppositions and replies. Except as otherwise provided in this
part or by the Librarian of Congress or a CARP, oppositions to motions
shall be filed within seven business days of the filing of the motion,
and replies to oppositions shall be filed within five business days of
the filing of the opposition. Each party must serve all motions,
petitions, objections, oppositions, and replies on the other parties or
their counsel by means no slower than overnight express mail on the
same day the pleading is filed.
10. In Sec. 251.45, paragraphs (b)(1)(i) and (b)(2)(i) are revised
to read as follows:
Sec. 251.45 Discovery and prehearing motions.
* * * * *
(b) * * *
(1)(i) In the case of a royalty fee distribution proceeding, the
Librarian of Congress shall, after the filing of comments and notices
described in paragraph (a) of this section, designate a 45-day period
for precontroversy discovery and exchange of documents. The period will
begin with the exchange of written direct cases among the parties to
the proceeding. Each party to the proceeding must effect actual
delivery of a complete copy of its written direct case on each of the
other parties to the proceeding no later than the first day of the 45-
day period. At any time during the 45-day period, any party to the
proceeding may file with the Librarian prehearing motions and
objections, including petitions to dispense with formal hearings under
Sec. 251.41(b) and objections to arbitrators appearing on the
arbitrator list under Sec. 251.4. Responses to motions, petitions, and
objections must be filed with the Librarian within seven business days
from the filing of such motions, petitions, and objections. Replies to
the responses shall be filed within five business days from the filing
of such responses with the Librarian. Each party must serve all
motions, petitions, objections, oppositions, and replies on the other
parties or their counsel by means no slower than overnight express mail
on the same day the pleading is filed.
* * * * *
(2)(i) In the case of a rate adjustment proceeding, the Librarian
of Congress shall, after the filing of comments and notices described
in paragraph (a) of this section, designate a 45-day period for
precontroversy discovery and exchange of documents. The period will
begin with the exchange of written direct cases among the parties to
the proceeding. Each party to the proceeding must effect actual
delivery of a complete copy of its written direct case on each of the
other parties to the proceeding no later than the first day of the 45-
day period. At any time during the 45-day period, any party to the
proceeding may file with the Librarian prehearing motions and
objections, including petitions to dispense with formal hearings under
Sec. 251.41(b) and objections to arbitrators appearing on the
arbitrator list under Sec. 251.4. Responses to motions, petitions, and
objections must be filed with the Librarian within seven business days
from the filing of such motions, petitions, and objections. Replies to
the responses shall be filed within five business days from the filing
of such responses with the Librarian. Each party must serve all
motions, petitions, objections, oppositions, and replies on the other
parties or their counsel by means no slower than overnight express mail
on the same day the pleading is filed.
* * * * *
Sec. 251.63 Consideration of petition; settlements. [Amended]
11. Section 251.63(a) is amended by removing the phrase
``consideration of their settlement.'' and adding the phrase
``negotiation of a settlement.'' after the phrase ``designate a 30-day
period for''.
PART 252--FILING OF CLAIMS TO CABLE ROYALTY FEES
12. The authority citation for part 252 continues to read as
follows:
Authority: 17 U.S.C. 111(d)(4), 801, 803.
13. In Sec. 252.4, paragraph (e) is revised to read as follows:
Sec. 252.4 Compliance with statutory dates.
* * * * *
(e) In the event that a properly addressed and mailed claim is not
timely received by the Copyright Office, a claimant may nonetheless
prove that the claim was properly filed if it was sent by certified
mail return receipt requested, and the claimant can provide a receipt
bearing a July date stamp of the U.S. Postal Service, except where
paragraph (b) of this section applies. No affidavit of an officer or
employee of the claimant, or of a U.S. postal worker will be accepted
in lieu of the receipt.
PART 257--FILING OF CLAIMS TO SATELLITE CARRIER ROYALTY FEES
14. The authority citation for part 257 continues to read as
follows:
Authority: 17 U.S.C. 119(b)(4).
15. In Sec. 257.4, paragraph (e) is revised to read as follows:
Sec. 257.4 Compliance with statutory dates.
* * * * *
(e) In the event that a properly addressed and mailed claim is not
timely received by the Copyright Office, a claimant may nonetheless
prove that the claim was properly filed if it was sent by certified
mail return receipt requested, and the claimant can provide a receipt
bearing a July date stamp of the U.S. Postal Service, except where
paragraph (b) of this section applies. No affidavit of an officer or
employee of the claimant, or of a U.S. postal worker will be accepted
in lieu of the receipt.
PART 259--FILING OF CLAIMS TO DIGITAL AUDIO RECORDING DEVICES AND
MEDIA ROYALTY PAYMENTS
16. The authority citation for part 259 continues to read as
follows:
Authority: 17 U.S.C. 1007(a)(1).
Sec. 259.2 Time of filing. [Amended]
17. In Sec. 259.2, the last sentence in paragraph (c) introductory
text is amended by removing the phrase ``in cases'' and adding the
phrase ``for claimants to the Musical Works Fund'' after the word
``required''.
18. In Sec. 259.5, paragraph (e) is revised to read as follows:
Sec. 259.5 Compliance with statutory dates.
* * * * *
(e) In the event that a properly addressed and mailed claim is not
timely received by the Copyright Office, a claimant may nonetheless
prove that the claim was properly filed if it was sent by certified
mail return receipt requested, and the claimant can provide a receipt
bearing a January or February date stamp of the U.S. Postal Service,
except where paragraph (b) of this section applies. No affidavit of an
officer or employee of the claimant, or of a U.S. postal worker will be
accepted in lieu of the receipt.
Dated: November 12, 1996.
Marybeth Peters,
Register of Copyrights.
So Adopted:
James H. Billington,
The Librarian of Congress.
[FR Doc. 96-30458 Filed 11-29-96; 8:45 am]