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Pre-1972 sound recordings are back in the news. Yesterday, the US Court of Appeals for the Second Circuit decided to defer its consideration of an appeal of a District Court’s decision that NY law included a public performance right for pre-1972 sound recordings. The Court deferred its decision until it can get a definitive answer as to whether or not such a right exists under NY state law. To get that definitive answer, the Court of Appeals referred the question to the NY State Court of Appeals (the highest court in New York State) asking it to issue an opinion as to whether the right exists.   Reading the order referring the case to the NY state court, there are a number of interesting issues addressed, including a discussion that could help decide the ramifications for over-the-air broadcasters who play these recordings.

First, we should provide a reminder about what the case here is all about. This case was brought by Flo and Eddie, members of the 1960s band The Turtles, who alleged that Sirius XM (and Pandora in a separate case) owed them royalties for playing pre-1972 sound recordings on their music services (see our article on the filing of the suit, here). Pre-1972 sound recordings first copyrighted in the United States are not covered by Federal law (see our article here and here about a Copyright Office inquiry on whether they should be brought under Federal law). While most states have laws prohibiting the reproduction of those recordings (e.g. prohibiting bootlegging of the recordings), none has an explicit statutory grant of a public performance right such as that collected by SoundExchange for post-1972 works. Sirius XM has thus excluded performances of pre-1972 sound recordings from the royalties that it has paid to SoundExchange (with the blessing of the Copyright Royalty Board in their last proceeding, see our story here). And allegedly Pandora has done the same. In this case, Flo and Eddie argued that in fact state law did convey a public performance right in sound recordings. Many observers (including this author) suggested that this argument would not succeed given that finding that a general performance right existed would be contrary to US law, and could subject all sorts of businesses that have never paid royalties for public performances of sound recordings, from over-the-air radio stations to bars and restaurants, to a performance royalty only when they played oldies. Nevertheless, Flo and Eddie were successful with their arguments in lower Federal Courts in California and New York (see our articles here and here), but a court in Florida denied their claims, finding that there is no performance right in pre-1972 sound recordings in that state (see our article here). The Court of Appeals decision yesterday was on the appeal of the NY decision referenced above. Why did the Court of Appeals need to send this case to the NY state court system?
Continue Reading Appeal of Public Performance Rights in Pre-1972 Sound Recordings Referred to NY State Court for Interpretation – What Issues Might Radio Broadcasters Be Facing?

Both the popular and media trade press has been full of reports in the last few weeks about musicians and other artists petitioning the Copyright Office to hold YouTube and other online services liable for infringement when the artists’ copyrighted material appears on the service (see, e.g. the articles here and here). The complaints allege that these services are slow to pull infringing content and, even when that content is pulled from a website, it reappears soon thereafter, being re-posted to those services once again. While the news reports all cite the filings of various artists or artist groups, or copyright holders like the record labels, they don’t usually note the context in which these comments were filed – a review by the Copyright Office of Section 512 of the Copyright Act which protects internet service providers from copyright liability for the actions taken by users of their services (see the Notice of Inquiry launching the review here). All of these “petitions” mentioned in the press were just comments filed in the Copyright Office proceeding, where comments were due the week before last. The Copyright Office will also be holding two roundtable discussions of the issues raised by this proceeding next month, one in California and one in New York City (see the notice announcing these roundtables here). What is at issue in this inquiry?

Section 512 was adopted to protect differing types of internet service providers from copyright liability for material that uses their services. Section 512(a) protects ISPs from liability for material that passes through their systems. That section does not seem to be particularly controversial, as no one seems to question the insulation from liability of the provider of the “pipes” through which content passes – essentially a common carrier-like function of just providing the infrastructure through which messages are conveyed. Sheltered from liability by Section 512(b) are providers of systems caching – temporary storage of material sent by third-parties on a computer system maintained by a service provider, where the provider essentially provides cloud storage to third-parties using some automated system where the provider never reviews the content. That section also does not seem particularly controversial. Where the issues really seem to arise is in the safe harbor provided in Section 512(c) which is titled “Information residing on systems or networks at the direction of users” – what is commonly called “user-generated content.”
Continue Reading Copyright Office Reviews Section 512 Safe Harbor for Online User-Generated Content – The Differing Perceptions of Musicians and Other Copyright Holders and Online Service Providers on the Notice and Take-Down Process

This article was written by two new contributors to the Blog, trademark attorneys Radhika “Ronnie” Raju and Kelly Donohue.

According to the Patent and Trademark Office (PTO), the answer is “No,” as the PTO recently refused an application by the producer of the podcast to register the mark SERIAL for an ongoing audio program, finding that the mark was too “descriptive” to be registered (the decision and related documents can be found here – note it is a relatively big file). This case demonstrates the need for companies and other content creators to be creative in choosing the brands by which their works will be known, as a name that is too generic may face hurdles like this one when the creator tries to protect its brand through a federal trademark registration. Media companies all need to think carefully about program names and other brands to be sure that they can be protected – especially if they hit it big.

SERIAL is the Peabody award-winning podcast from the creators of the public radio program This American Life. The podcast, narrated by journalist Sarah Koening, is a long form story, told over the course of multiple episodes, that looks into the 1999 murder of Hae Min Lee and the resulting conviction of her former boyfriend, Adnan Masud Syed. Since its launch in October 2014, Season 1 has been downloaded in the United States over 80 million times, with episodes still being downloaded at a clip of over a 100,000 times a month. Season 2 of SERIAL just concluded last week. Media observers have called SERIAL a phenomenon which fueled the 2014 podcast renaissance. Given that it is so well-known and successful, why did the PTO refuse to register the name of this groundbreaking podcast?
Continue Reading SERIAL Trademark Denied – Should One of the Most Popular Podcasts Ever Be Able to Protect Its Name?

FilmOnX, that Aereo copycat service that seeks to deliver the signals of over-the-air television stations to consumers’ computers for a fee, has lost another round in its attempt to be recognized as a cable system. Ever since the Aereo decision of the Supreme Court (which we summarized here), finding that services like Aereo and FilmOn did involve a public performance of television programming for which they permission of program owners, FilmOn has been seeking to be declared a cable system. Why? Because cable systems have a “statutory license” under Section 111 of the Copyright Act allowing them to rebroadcast television programming without explicit permission of the copyright owners simply by paying a fee – a fee which is very small when rebroadcasting a television signal in its own television market. The decision released last week by the US District Court for the Northern District of Illinois joined courts in New York and DC (see our article about the DC court decision here) in determining that FilmOn did not qualify for that license. Only a lone court in California has thus far agreed with FilmOn’s position (see our summary here), and that decision is on appeal.

In reaching its decision, the Illinois court looked at the definition of a cable system in the Copyright Act. The Copyright Act states that a cable system is “a facility” that “receives signals transmitted or programs broadcast by one or more television broadcast stations” and “makes secondary transmission of such signals or programs by wires, cables microwave or other communications channels” to subscribers. In looking at that definition, the Court found that the FilmOn system was not a facility that made secondary transmissions (meaning a rebroadcast or retransmission of the original signal) of the television signals that it received. While it received those signals, rather than transmitting those signals to the public, as does a traditional cable system or even an unwired “wireless cable system,” FilmOn instead simply transmitted those signals to the Internet, and the Internet was the mechanism that delivered the signals to the customers. In essence, the Court adopts the requirement for a “facilities based” transmission system in order for a system to be considered a cable system for purposes of qualifying for the statutory license – meaning that it must be one that owns or controls the means of communication of the television signals to the company’s customers. As FilmOn does not own or control the Internet, it is not such a facilities-based carrier.
Continue Reading Another Loss for FilmOnX in its Quest to Be Recognized as a Cable System Entitled to Rely on Statutory License to Retransmit TV Signals

The recent Copyright Royalty Board decision (see my summary here) setting the rates to be paid by Internet radio operators to SoundExchange for the rights to publicly perform sound recordings (a particular recording of a song as performed by an artist or band) still raises many questions. Today, Jacobs Media Strategies published on their blog an article I wrote on the topic – discussing 5 things that broadcasters should know about music royalties. While the content of the article is, to some who are accustomed to dealing with digital music rights, very basic, there are many to whom the additional guidance can be helpful. The subject of music rights is so confusing to those who do not routinely deal with the topic – even to those who work in radio or other industries that routinely perform music and to journalists and analysts that write about the topic. Thus, repeating the basics can still be important. For those who click through from the Jacobs blog to this one, and for others interested in more information on the topics on which I wrote, I thought that I’d post some links to past articles on this blog on the subjects covered in the Jacobs article. So here are the topic headings, and links to where you can find additional information.

The new royalties set by the CRB represent a big savings for broadcasters. I wrote how the royalties represent a big savings for most broadcasters who simulcast their signals on the Internet. I provide more details about the new rates and how they compare to the old ones here.
Continue Reading 5 Things Broadcasters Should Know About SoundExchange Music Royalties

In the last day or two, some broadcast trade press reports may have given the impression that the FCC’s new online public file rules for radio may now be “effective,” suggesting that Top 50 market stations with 5 or more full-time employees need to start uploading their new political documents into the file (the first…

March appears to be another busy month on the FCC’s regulatory calendar.  While March is one of those months where there is not the usual assortment of EEO public file reports, quarterly issues programs lists or children’s television reports and noncommercial ownership report obligations (see our Broadcasters’ Regulatory Calendar here for some of these dates), it is a month with many other significant regulatory dates.  For instance, this month brings the scheduled start of the TV incentive auction as stations make binding commitments as top whether they will accept the FCC’s opening bids in the reverse auction.  It also brings deadlines for comments in a number of other proceedings that may affect broadcasters, including the FCC’s proceeding on AM radio revitalization and the Copyright Office’s look at the safe harbor for user-generated content.  In addition to comment periods, the lowest unit rate periods that apply during the 45 days before a Presidential primary are in effect in many states, plus March brings other deadlines including those for the first filing date for monthly SoundExchange Reports of Use under the new Internet radio royalty rates.  All make for a month where broadcasters need to watch regulatory developments very closely.

So let’s start with the incentive auction.  As we wrote just a few days ago, March 29 is the deadline for TV broadcasters to make a binding commitment to accept the FCC’s initial offer to buy their spectrum.  TV broadcasters who filed applications to participate in the Incentive Auction back in January were merely leaving the door open to their participation.  The March 29 deadline is the real legally binding commitment to surrender their spectrum at the price that the FCC has offered for their stations.  To make sure that broadcasters understand what they are doing, and how to make their commitments, as we wrote in our article, the FCC has set up an online tutorial on the system and will be holding a workshop about the process.  So if you have a TV station interested in taking advantage of the FCC’s offer to buy out your frequency, this is the month that the commitment needs to be made.
Continue Reading March Regulatory Dates for Broadcasters – Including Incentive Auction Commitments, New Webcasting Royalties, and Comments on AM Revitalization and Copyright Safe Harbor for User-Generated Content

The text of the Copyright Royalty Board decision on Internet Radio Royalties for 2016-2020 was released last Friday. While it is 203 pages long, the basis for the decision is relatively simple. As required by the Copyright Act, the Copyright Royalty Judges looked at all of the evidence presented to determine what rate a willing buyer and a willing seller would agree to in a marketplace transaction. In looking at that evidence, they decided that the best evidence for that rate was two deals actually done in the marketplace – one deal between Pandora and the independent record label organization Merlin and another between iHeartRadio and Warner Music. As these were deals for the very rates to be decided by the Judges – the rates for the public performance of sound recordings by noninteractive streaming companies – the Judges determined that these two deals best evidenced the value put on streaming royalties by actual players in the marketplace. Looking at the per song per listener rates specified in those deals, and making a few adjustments based on other consideration included in the deals (particularly in the iHeart deal), the Judges arrived at a per song per listener rate for each deal, and determined that they set the bounds of the reasonable rates for nonsubscription webcasting. Taking into account that approximately 2/3 of the music played by webcasters is from major labels like Warner as opposed to that from the independent labels such as those that were part of the Merlin group, the Judges gave the rates from the iHeart deal greater weight in determining where within the zone of reasonableness the rates should fall. Thus, the Board determined that the rate for nonsubscription, noninteractive services should be $.0017 per performance (i.e. per song per listener). This is the rate that they published back in December (about which we wrote here).

While the basis for the decision seems relatively simple, the process to get to that decision was not – and it took 203 pages for the Judges to discuss all of the issues that they weighed in coming to their conclusions. While some of those pages were dedicated to discussions of the rates for noncommercial webcasters and the terms of the payments to be made by webcasters (topics we will try to cover in a later post), the bulk of the decision was a discussion of how the Judges weighed the arguments of the parties in the case in reaching their conclusion. While no summary can cover all of the issues that went into this consideration, some of the issues covered in this decision are discussed below.
Continue Reading Looking at the Decision of the Copyright Royalty Board on Internet Radio Royalties for Commercial Webcasters – What are the Issues that the Judges Considered?

In Washington DC this week, many in the communications world are commemorating the 20th anniversary of the passage of the Telecommunications Act of 1996. Five years ago, we noted the changes that the Act made in the broadcast regulatory world – changes that are still being debated 20 years later. To show how little things change, I thought that I would republish the article that I wrote 5 years ago. There, I talked about some of the changes made in 1996 in the broadcast ownership rules that were still being debated in 2011, and suggested that they might be resolved by the review of the multiple ownership rules that was then about to begin. Of course, that didn’t happen (see our article here about the FCC’s decision to push most of the ownership decisions into the current Quadrennial Review of those rules. So we can again make the same claim – that perhaps some of these issues will be resolved by the current ownership rule review that is supposed to be decided this summer (though that date may well slip – see our predictions for the FCC’s actions on broadcast issues for this year, here).

Our article from 5 years ago also talked about calls then being made by one FCC Commissioner to roll back some of the 1996 reforms lengthening the license term for broadcasters. Those calls seem to have gone unheard so perhaps that one issue may have been resolved – at least for the time being.  It also discussed the proposals for the repurposing of the TV spectrum for wireless uses, which has led to the Incentive Auction that the FCC is about to conduct. 

But other issues remain on the table.  So here is a look back at what I wrote 5 years ago on the 15th anniversary of the Act:

On February 8, 1996, the Telecommunications Act of 1996 was signed into law by President Bill Clinton.  While the Act had significant impact throughout the communications industry, the impact on broadcasters was profound, and is still being debated.  The Act made changes for broadcasters in several major areas:

  • Lengthened license renewals to 8 years for both radio and TV, and eliminated the “comparative renewal”
  • For radio, eliminated all national caps on the number of radio stations in which one party could have an attributable interest and increased to 8 stations the number one party could own in the largest radio markets
  • For television, raised national ownership caps to having stations that reached no more than 35% of the national audience, with no limits on the number of stations that could be owned as long as their reach was under that cap.
  • Allocated spectrum that resulted in the DTV transition

Obviously, the DTV spectrum began the profound changes in the way television is broadcast, and led to the current debate as to whether over-the-air television should be further cut back in order to promote wireless broadband (see our recent post on the FCC’s current proceeding on this issue).  While the other changes have now been in effect for 15 years, the debate over these provisions continue.  Some argue that the renewal and ownership modifications have created too much consolidation in the broadcast media and lessened the broadcaster’s commitment to serving the public interest.  Others argue that, in the current media world, these changes don’t go far enough. Broadcasters are under attack from many directions, as new competitors fight for local audiences (often with minimally regulated multi-channel platforms, such as those delivered over the Internet) and others attack broadcasters principal financial support – their advertising revenue. Even local advertising dollars, traditionally fought over by broadcasters and newspapers (with some competition from billboards, direct mail and local cable), is now under assault from services such as Groupon and Living Social, and from other new media competitors of all sorts.  With the debated continuing on these issues in the current day, it might be worth a few looking back at the 1996 changes for broadcasters, and their impact on the current broadcast policy debate.
Continue Reading On Its 20th Anniversary, Looking Back at How the Telecommunications Act of 1996 Changed the Broadcast Regulatory Landscape

Last week, we wrote about the FCC’s decision to require that radio stations move their public inspection files online.  Commercial stations with 5 or more full-time employees that are located in Top 50 markets need to make the transition to the online file later this year once the FCC gets its new rules approved by the Office of Management and Budget following a Paperwork Reduction Act review.  Other radio stations will need to come into compliance, unless they get a waiver of the new rules, by March 1, 2018.  Our initial article about the decision was based on the FCC’s press release on the decision and comments made at the FCC meeting at which the obligation was adopted.  The FCC has now released the full-text of the decision (available here) and that order contains many new nuggets of information about the new obligations about which stations need to be aware.

The text of the decision does a good job of summarizing the obligations of radio broadcaster’s current public inspection file obligations (as well as those of the other entities that were also addressed by the new rule – cable systems, DBS operators, and Sirius XM for their satellite radio service).  For each of these services, the FCC addressed a number of issues.  Some of the radio questions addressed by the order include those set forth below.
Continue Reading FCC Releases Order on Online Public Inspection File – Answering Questions about Compliance with Radio’s New Obligations