E9-30825. Adjustment of Cable Statutory License Royalty Rates

AGENCY:

Copyright Royalty Board, Library of Congress.

ACTION:

Notice announcing commencement of proceeding with request for Petitions to Participate.

SUMMARY:

The Copyright Royalty Judges are announcing the commencement of the proceeding to adjust the rates for the cable statutory license. The Copyright Royalty Judges also are announcing the date by which a party who wishes to participate in the rate adjustment proceeding must file its Petition to Participate and the accompanying $150 filing fee.

DATES:

Petitions to Participate and the filing fee are due no later than February 4, 2010.

ADDRESSES:

An original, five copies, and an electronic copy in Portable Document Format (PDF) on a CD of the Petition to Participate, along with the $150 filing fee, may be delivered to the Copyright Royalty Board by either mail or hand delivery. Petitions to Participate and the $150 filing fee may not be delivered by an overnight delivery service other than the U.S. Postal Service Express Mail. If by mail (including overnight delivery), Petitions to Participate, along with the $150 filing fee, must be addressed to: Copyright Royalty Board, P.O. Box 70977, Washington, DC 20024-0977. If hand delivered by a private party, Petitions to Participate, along with the $150 filing fee, must be brought between 8:30 a.m. and 5 p.m. to the Library of Congress, James Madison Memorial Building, LM-401, 101 Independence Avenue, SE., Washington, DC 20559-6000. If delivered by a commercial courier, Petitions to Participate, along with the $150 filing fee, must be delivered between 8:30 a.m. and 4 p.m. to the Congressional Courier Acceptance Site, located at 2nd and D Street, NE., Washington, DC. The envelope must be addressed to: Copyright Royalty Board, Library of Congress, James Madison Memorial Building, LM-403, 101 Independence Avenue, SE., Washington, DC 20559-6000.

FOR FURTHER INFORMATION CONTACT:

LaKeshia Keys, CRB Program Specialist, by telephone at [phone] or e-mail at [e-mail].

SUPPLEMENTARY INFORMATION:

Background

Section 111 of the Copyright Act, title 17 of the United States Code, grants a statutory copyright license to cable television systems for the retransmission of over-the-air television and radio broadcast stations to their subscribers. In exchange for the license, cable operators submit royalties, along with statements of account detailing their retransmissions, to the Copyright Office on a semi-annual basis. The Office then deposits the royalties with the United States Treasury for later distribution to copyright owners of the broadcast programming retransmitted by cable systems.

A cable system calculates its royalty payments in accordance with the statutory formula described in 17 U.S.C. 111(d). Royalty fees are based upon the gross receipts received by a cable system from subscribers receiving retransmitted broadcast signals. Section 111(d) subdivides cable systems into three categories based on their gross receipts: small, medium, and large. Small systems pay a fixed amount without regard to the number of broadcast signals they retransmit, while medium-sized systems pay a royalty within a specified range, with a maximum amount, based on the number of signals they retransmit. Large cable systems calculate their royalties according to the number of distant broadcast signals which they retransmit to their subscribers.^[1] Under this formula, a large cable system is required to pay a specified percentage of its gross receipts for each distant signal that it retransmits.

Congress established the initial gross receipts limitations that determine a cable system's size and provided the gross receipts percentages (i.e., the royalty rates) for distant signals. 17 U.S.C. 111(d)(1). It also provided for adjustment of both the gross receipts limitations and the distant signal rates. 17 U.S.C. 801(b)(2). The limitations and rates can be adjusted to reflect national monetary inflation, changes in the average rates charged by cable systems for the retransmissions of broadcast signals, or changes in certain cable rules of the Federal Communications Commission in effect on April 15, 1976. 17 U.S.C. 801(b)(2)(A), (B), (C), and (D). Prior rate adjustments of the Copyright Royalty Tribunal or Librarian of Congress made under section 801(b)(2)(B) and (C) may be reconsidered at five-year intervals. 17 U.S.C. 804(b). The current gross receipts limitations and rates are set forth in 37 CFR 256.2. Rate adjustments are now made by the Copyright Royalty Judges.

Section 804 of the Copyright Act provides that the gross receipts and royalty rates may be adjusted every five years beginning with 2005, thus making 2010 a royalty adjustment year, upon the filing of a petition to initiate a proceeding. 17 U.S.C. 804(b)(1). However, since no petition has been filed pursuant to section 804(b)(1), section 803(b)(1)(A)(i)(V) requires the Judges to publish a Federal Register notice no later than January 5, 2010, commencing this proceeding.

Petitions to Participate

Petitions to Participate must be filed in accordance with § 351.1(b) of the Judges' regulations. See 37 CFR 351.1(b). Petitions to Participate must be accompanied by the $150 filing fee. Cash will not be accepted; therefore, parties must pay the filing fee with a check or money order made payable to “Copyright Royalty Board.” If a check received in payment of the filing fee is returned for lack of sufficient funds, the corresponding Petition to Participate will be dismissed.

Note that in accordance with 37 CFR 350.2 (Representation), only attorneys who are members of the bar in or more states and in good standing will be allowed to represent parties before the Copyright Royalty Judges, unless a party is an individual who represents herself or himself.

Dated: December 23, 2009.

William J. Roberts, Jr.,

U.S. Copyright Royalty Judge.

Footnotes

1.  For large cable systems which retransmit only local broadcast stations, there is a minimum royalty fee which must be paid. This minimum fee is not applied, however, once the cable system carries one or more distant signals.