The Copyright Royalty Board Decision on the royalty rates to be paid for the public performance of sound recordings by Internet radio companies – webcasting royalties – was published in the Federal Register today. We wrote about that decision setting the royalties here and here. The publication in the Federal Register gives parties to the proceeding 30 days in which to file an appeal of the decision. Appeals are heard by the US Court of Appeals in Washington DC.
While we have written about some issues with the decision raised by small webcasters about there not being a percentage of revenue royalty, as that issue was not raised before the CRB as no small webcasters participated, that is not an issue that the Court will consider – as the Court looks to whether the decision was arbitrary and capricious based on the evidence adduced at trial, or whether the decision was without substantial evidence in the record. It is focused on what was argued at trial, rather than what was not. Similarly, the issues about the performance complement waivers for broadcasters, which we also wrote about in the same article, are statutory issues that need to be addressed by waivers from copyright holders, not by a court appeal. Noncommercial groups have also expressed disappointment in the decision.
Is anyone likely to appeal? You never know who is going to appeal these decisions. In the past, noncommercial groups have appealed (once getting the Court to determine that the CRB had been unconstitutionally formed, see our articles here and here). All of the services asked for lower rates than the CRB actually set in this case, so they could appeal. But many eyes are on SoundExchange, as this decision was the first decision in which the “standard” CRB-set royalties for nonsubscription webcasting actually decreased from .23 cents per song per listener (“per performance”) to .17 cents per performance. The rates, after initially being set in the Copyright Arbitration Royalty Panel decision in 2001, have only gone up in CRB decisions in 2006 and 2010.
But we will see what happens on appeal, unless these rates, which are already in effect while subject to appeal, set another first by not being appealed by any party. We’ll know in a little more than a month.