2011-4462. Distribution of 2005 Through 2008 DART Musical Works Funds Royalties

AGENCY:

Copyright Royalty Board, Library of Congress.

ACTION:

Notice soliciting comments on motion for partial distribution.

SUMMARY:

The Copyright Royalty Judges are soliciting comments on a motion for partial distribution in connection with 2005, 2006, 2007, and 2008 DART Musical Works Fund royalties.

DATES:

Comments are due on or before March 31, 2011.

ADDRESSES:

Comments may be sent electronically to [e-mail]. In the alternative, send an original, five copies, and an electronic copy on a CD either by mail or hand delivery. Please do not use multiple means of transmission. Comments may not be delivered by an overnight delivery service other than the U.S. Postal Service Express Mail. If by mail (including overnight delivery), comments must be addressed to: Copyright Royalty Board, P.O. Box 70977, Washington, DC 20024-0977. If hand delivered by a private party, comments must be brought 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, comments must be delivered 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:

Richard Strasser, Senior Attorney, or Gina Giuffreda, Attorney Advisor, by telephone at [phone] or e-mail at [e-mail].

SUPPLEMENTARY INFORMATION:

On April 8, 2010, Broadcast Music, Inc., the American Society of Composers, Authors and Publishers, SESAC, Inc. and The Harry Fox Agency, Inc. (hereinafter “Settling Claimants”) filed with the Judges a Motion for Partial Distribution of the Digital Audio Recording Technology (“DART”) Musical Works Funds for 2005, 2006, 2007, and 2008. In the Motion the Settling Claimants state that they have reached confidential settlements concerning their respective distribution shares for these years. The Settling Claimants request that the Judges, pursuant to Section 801(b)(3)(A) of the Copyright Act, distribute to the Settling Claimants 95% of the 2005-2008 DART Musical Works Funds, for the Writers and Music Publishers Subfunds. They also request that the Copyright Royalty Judges (“Judges”) publish notice in the Federal Register requesting comments on their proposed partial distribution. Section 801(b)(3)(A) authorizes the Judges to order distributions of royalty funds to the extent that the Judges find that the distribution of such fees is not subject to controversy. 17 U.S.C. 801(b)(3)(A). That section of the Copyright Act does not require publication in the Federal Register, but it does require that the Judges find that the fees requested are not subject to controversy. The Settling Claimants do not make such a representation. Rather they represent that they have agreed among themselves how any distributed funds should be allocated among themselves. The Settling Claimants state that the Judges “have the discretion, within a zone of reasonableness, to find that 95% of the royalties are not in controversy.” Motion at 4. As support for this assertion, they state that “[i]n the past four DART proceedings, non-settling individual writer and publisher claimants collectively have either received less than one tenth of one percent (0.1%) of the royalty funds or have been dismissed altogether * * *. Accordingly, as in the past, at least 95% of the 2005-2008 Musical Works Funds is clearly not in controversy, and a partial distribution of this amount to the Settling Parties is appropriate and warranted at this time.” Id. We do not agree that Section 801(b)(3)(A) gives us the discretion to determine that 95% of the funds at issue in this matter are not in controversy based on the Settling Claimants' representations that non-settling claimants were awarded less than five percent of the funds in prior proceedings. Moreover, the Settling Claimants chose not to serve all of the claimants and therefore those claimants were given no opportunity to comment on whether the Settling Claimants' assertions with respect to a controversy are accurate. In the absence of persuasive evidence that no controversy exists with respect to the funds that the Settling Claimants request, we cannot make the requisite finding under Section 801(b)(3)(A) that no controversy exists with respect to the requested funds. Nevertheless, we do have authority under Section 801(b)(3)(C) of the Copyright Act to authorize partial distributions if, after publication in the Federal Register, we determine that no claimant entitled to receive such fees has stated a reasonable objection to the partial distribution and the Settling Claimants requesting the partial distribution agree, among other things, to sign an agreement obligating them to return any excess amounts to the extent necessary to comply with the final determination on the distribution of the funds. See 17 U.S.C. 801(b)(3)(C). Therefore, we seek comments from any claimant entitled to receive royalties from the 2005-2008 DART Musical Works Funds regarding whether there are any reasonable objections to a partial distribution of 95% of the 2005-2008 Musical Works Funds to the Settling Claimants. Moreover, we request comments from the Settling Claimants regarding whether they are willing to make the representations required for a partial distribution pursuant to Section 801(b)(3)(C) of the Copyright Act.

The Motion of the Settling Claimants for Partial Distribution is posted on the Copyright Royalty Board Web site at http://www.loc.gov/​crb.

Dated: February 24, 2011.

James Scott Sledge,

Chief U.S. Copyright Royalty Judge.