Update (January 24, 2024) – The Copyright Royalty Board issued a Federal Register Notice correcting the deadline for Petitions to Participate in the WEB VI proceeding – making clear that the deadline is February 5, 2024, not February 6 as previously reported. This article has been updated with the corrected deadline. For more information, see our article here).
The Copyright Royalty Board on Friday published in the Federal Register a call for interested parties to file Petitions to Participate in the proceeding to set the royalty rates to be paid by webcasters (including broadcasters who simulcast their programming through internet-delivered channels) in the period 2026-2030. These royalties are paid by webcasters to SoundExchange for the noninteractive streaming of sound recordings. The CRB is required to review these rates every five years. These proceedings are lengthy and include extensive discovery and a trial-like hearing to determine what royalty a “willing buyer and a willing seller” would agree to in a marketplace transaction. Because of the complexity of the process, the CRB starts the proceeding early in the year before the year in which the current royalty rate expires. So, as the current rates expire at the end of 2025, parties will need to sign up to participate in the proceeding to determine 2026-2030 rates by February 5, 2024 by filing a Petition to Participate. The Petition must describe the party’s interest in the proceeding and be accompanied by a filing fee of $150. The Federal Register notice provides other procedural details for filing these Petitions.
Once the Petitions to Participate are filed, the CRB will set out the rules and procedures to be followed in the proceeding. Initially, there is a 90 day period in which the parties can try to settle the case. While parties can settle at any time (subject to approval of the terms by the CRB), this initial 90-day period occurs before any litigation begins and offers parties the opportunity to avoid much of the cost of litigation. Once that period ends without a settlement, the litigation begins. Initial stages of the litigation (including the identification of witnesses, submission of the rate proposals and the evidence supporting those proposals, and the initial discovery) will likely all take place in 2024, with the hearing itself conducted in 2025, followed by final briefs summarizing the evidence and arguing about the conclusions to be drawn from that evidence. There are usually oral arguments held after the briefs are submitted. At that point, the three Copyright Royalty Judges will consider the evidence and the arguments and release their decisions late in 2025, so that parties know the new rates as of January 1, 2026. While there may be appeals of the decision that are argued well beyond the effective date of the new rates, the rates become effective while those appeals are pending.Continue Reading Copyright Royalty Board Starts WEB VI Proceeding to Set Webcasting Royalties Paid to SoundExchange for 2026-2030: Petitions to Participate Due February 5