2010-13575. Rate Adjustment for the Satellite Carrier Compulsory License

AGENCY:

Copyright Royalty Board, Library of Congress.

ACTION:

Notice of voluntary negotiation period.

SUMMARY:

The Copyright Royalty Judges are announcing the voluntary negotiation period for the purpose of determining the royalty fees to be paid by satellite carriers under the satellite carrier compulsory license.

DATES:

The voluntary negotiation period commences on June 7, 2010, and concludes on June 17, 2010.

ADDRESSES:

^[1] If hand delivered by a private party, an original and five copies of voluntary agreements should be brought to the Library of Congress, U.S. Copyright Office, Room LM-401, James Madison Memorial Building, 101 Independence Avenue, SE., Washington, DC 20559, between 8:30 a.m. and 5 p.m. The envelope should be addressed as follows: Office of the General Counsel, U.S. Copyright Office. If delivered by a commercial courier, an original and five copies of voluntary agreements must be delivered to the Congressional Courier Acceptance Site (“CCAS”) located at 2nd and D Streets, NE., Washington, DC, between 8:30 a.m. and 4 p.m. The envelope should be addressed as follows: Office of the General Counsel, U.S. Copyright Office, LM-403, James Madison Memorial Building, 101 Independence Avenue, SE., Washington, DC 20559. Please note that CCAS will not accept delivery by means of overnight delivery services such as Federal Express, United Parcel Service or DHL. If sent by mail (including overnight delivery using U.S. Postal Service Express Mail), an original and five copies of voluntary agreements should be addressed to U.S. Copyright Office, Copyright GC/I&R, P.O. Box 70400, Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT:

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

SUPPLEMENTARY INFORMATION:

Background

The satellite carrier compulsory license establishes a statutory copyright licensing scheme for satellite carriers that retransmit television broadcast signals to satellite dish owners for their private home viewing. 17 U.S.C. 119. Congress created the license in 1988 with the passage of the Satellite Home Viewer Act of 1988. Congress reauthorized the license for additional five-year periods in 1994, 1999, and 2004, and the license was slated to expire on December 1, 2009. However, Congress again reauthorized the satellite license for another five years with the passage of the Satellite Television Extension and Localism Act of 2010, (“STELA”), Public Law No. 111-175, which was signed into law by the President on May 27, 2010.

Satellite carriers pay royalties based on a flat, per-subscriber, per-month fee. These rates were set initially by Congress in the Satellite Home Viewer Act of 1988 and then later adjusted by a three-person arbitration panel convened by the former Copyright Royalty Tribunal. 57 FR 129052 (May 1, 1992). When the license was reauthorized in 1994, Congress directed that the rates be adjusted by the Librarian of Congress using the system that replaced the Copyright Royalty Tribunal, namely, ad hoc Copyright Arbitration Royalty Panels (“CARPs”) administered by the Librarian of Congress and the Copyright Office. Accordingly, the Librarian adjusted the rates in 1997. 62 FR 55742 (October 28, 1997). In the Satellite Home Viewer Improvement Act of 1999, which reauthorized the license for an additional five years, Congress reduced the rates set by the Librarian. When Congress again reauthorized the license under the Satellite Home Viewer Extension and Reauthorization Act of 2004 (“SHVERA”), copyright owners and satellite carriers reached separate voluntary agreements regarding the rates to be paid for analog and digital signals carried by satellite carriers; and the Librarian adopted the respective rates. See 70 FR 17320 (April 6, 2005) and 70 FR 39178 (July 7, 2005).

STELA, in which Congress authorizes the Copyright Royalty Judges to determine the applicable satellite royalty rates moving forward, requires adjustment of the current rates to be paid by satellite carriers for the secondary transmission of the primary transmission of network stations and superstations. See 17 U.S.C. 119(c)(1)(B) & (F). This notice begins the process mandated by the statute.

Voluntary Negotiation Period

Sections 119(c)(1)(B) of the Copyright Act, title 17 of the United States Code, provides that “[o]n or before June 1, 2010, the Copyright Royalty Judges shall cause to be published in the Federal Register [notice] of the initiation of the voluntary negotiation proceedings for the purpose of determining the royalty fee to be paid by satellite carriers * * * under subsection (b)(1)(B).” ^[2] This notice initiates the voluntary negotiation period.

The statute provides that “[w]ithin 10 days after publication in the Federal Register of a notice of the initiation of voluntary negotiation proceedings, parties who have reached a voluntary agreement may request that the royalty fees in that agreement be applied to all satellite carriers, distributors, and copyright owners without convening a proceeding under subparagraph (F).” 17 U.S.C. 119(c)(1)(D)(ii)(I). In accordance with this provision, the voluntary negotiation period commences today, June 7, 2010, and concludes June 17, 2010.

If a voluntary agreement is reached by the end of the negotiation period, the parties can request that the Judges publish the agreement for notice and comment in accordance with section 119(c)(1)(D)(ii)(II) and adopt the rates in the voluntary agreement if no objections are received from a party with a significant interest and intention to participate in a proceeding. 17 U.S.C. 119(c)(1)(D)(ii)(III). If an objection to the voluntary agreement is received or if the parties are unable to reach a voluntary agreement, the Judges will commence a rate proceeding in accordance with section 119(c)(1)(F). Therefore, should a rate proceeding become necessary, the Judges will publish a subsequent notice commencing the proceeding and calling for the filing of petitions to participate.

Dated: June 2, 2010.

James S. Sledge,

Chief U.S. Copyright Royalty Judge.

Footnotes

1.  Section 119(c)(D)(i) of the Copyright Act, title 17 of the United States Code, requires that voluntary agreements be filed with the Copyright Office within 30 days of execution of the agreement. The Satellite Television Extension and Localism Act of 2010 does not change this provision.

2.  Since STELA was not signed until May 27, 2010, this notice is being published as soon as practicable after its enactment.