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Noncommercial Educational Broadcasting Compulsory License

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Copyright Office, Library of Congress.


Announcement of voluntary negotiation period, precontroversy discovery schedule, and request for Notices of Intent to Participate.


The Copyright Office of the Library of Congress is announcing a voluntary negotiation period for the 17 U.S.C. 118 noncommercial educational broadcasting compulsory license, along with a precontroversy discovery schedule, a request for Notices of Intent to Participate, and the initiation date should arbitration proceedings be necessary.


Notices of Intent to Participate are due on or before April 25, 2002.


If sent by mail, an original and five copies of Notices of Intent to Participate should be addressed to: Copyright Arbitration Royalty Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC 20024. If hand delivered, an original and five copies of Notices of Intent to Participate should be brought to: Office of the Copyright General Counsel, James Madison Memorial Building, Room LM-403, First and Independence Avenue, SE., Washington, DC 20540.

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David O. Carson, General Counsel, or William J. Roberts, Jr., Senior Attorney for Compulsory Licenses, Copyright Arbitration Royalty Panel (CARP), P.O. Start Printed Page 15415Box 70977, Southwest Station, Washington, DC 20024. Telephone (202) 707-8380. Telefax: (202) 252-3423.

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Section 118 of the Copyright Act, 17 U.S.C., creates a compulsory license for the use of certain copyrighted works in connection with noncommercial broadcasting. Terms and rates for this compulsory license applicable to parties who are not subject to privately negotiated licenses are published in 37 CFR part 253 and are subject to adjustment at five year intervals. The last adjustment of the terms and rates for the section 118 license occurred in 1997, thus, making 2002 a window year for the adjustment of these terms and rates.

Section 118(b) provides that copyright owners and public broadcasting entities may voluntarily negotiate licensing agreements at any time, and that such licensing agreements will be “given effect in lieu of any determination by the Librarian of Congress; Provided, That copies of such agreements are filed in the Copyright Office within thirty days of execution in accordance with regulations that the Register of Copyrights shall prescribe.” 17 U.S.C. 118(b)(2).

Those parties not subject to a negotiated license must follow the terms and rates adopted through arbitration proceedings conducted under chapter 8 of the Copyright Act. Section 118(b)(3) provides:

In the absence of license agreements negotiated under paragraph (2), the Librarian of Congress shall, pursuant to chapter 8, convene a copyright arbitration royalty panel to determine and publish in the Federal Register a schedule of rates and terms which, subject to paragraph (2), shall be binding on all owners of copyright in works specified by this subsection and public broadcasting entities, regardless of whether such copyright owners have submitted proposals to the Librarian of Congress. . . .

In order to commence the adjustment process described in section 118, the Copyright Office of the Library of Congress is publishing today's notice. With respect to private licenses, we note that the statute provides that they may be negotiated at any time and must be submitted to the Copyright Office in order to be effective. However, in keeping with tradition, we believe that it is appropriate and efficient to designate a negotiation period, prior to copyright arbitration royalty panel (CARP) proceedings, in order to encourage private agreements and, possibly, avoid the need for a CARP. Consequently, we are announcing a voluntary negotiation period commencing today and running to May 15, 2002. Any agreements entered into during this period should be deposited with the Copyright Office in accordance with the regulations established in 37 CFR 201.9. Of course, license agreements may still be negotiated and deposited prior to, and after, the designated negotiation period.

The Library notes that while many of the terms and rates of the section 118 license typically have been subject to private negotiation, certain terms and rates have not. These terms and rates affect the works of unknown copyright owners and owners not affiliated with one or more of the performing rights societies and/or artists organizations. See, e.g. 37 CFR 253.5(c)(4) and 253.6(c)(4). The Library recognizes that it is difficult, if not impossible, for noncommercial educational broadcasting entities to identify these copyright owners in order to negotiate terms and rates of licenses. Consequently, in these limited circumstances where negotiated licenses are not practicable, the Library is willing to accept proposals for terms and rates from noncommercial educational broadcasting entities and subject them to the public notice and comment provisions of § 251.63(b) of the Library's rules. The Librarian will adopt the proposed rates and terms, unless a copyright owner, with a significant interest in the proposal and an intent to participate fully in a CARP proceeding, files comment opposing the proposed terms and rates.

For all other terms and rates for the section 118 license, in the absence of negotiated licenses, the Librarian of Congress will convene a CARP. The proceeding will be conducted according to the following schedule.

Notices of Intent to Participate

Any party wishing to appear before the CARP, and to present evidence, in this proceeding must file a Notice of Intent to Participate by April 25, 2002. Failure to file a timely Notice of Intent to Participate will preclude a party from participating in this proceeding.

Precontroversy Discovery Schedule

The Library of Congress is announcing the scheduling of the precontroversy discovery period, and other procedural matters, for the establishment of rates and terms for the section 118 compulsory license. In addition, the Library is announcing the date on which arbitration proceedings will be initiated before a CARP, thereby commencing the 180-day arbitration period. Once a CARP has been convened, the scheduling of the arbitration period is within the discretion of the CARP and will be announced at that time.

A. Commencement of the Proceeding

A rate adjustment proceeding under part 251 of 37 CFR is divided into two essential phases. The first is the 45-day precontroversy discovery phase, during which the parties exchange their written direct cases, exchange their documentation and evidence in support of their written direct cases, and engage in the pre-CARP motions practice described in § 251.45. The other phase is the proceeding before the CARP itself, including the presentation of evidence and the submission of proposed findings by all of the participating parties. The proceeding before the CARP may be in the form of hearings or, in accordance with the requirements of § 251.41(b) of the rules, the proceeding may be conducted solely on the basis of written pleadings.

Both of these phases to a rate adjustment proceeding require significant amounts of work, not just for the parties, but for the Librarian, the Copyright Office, and the arbitrators as well. The rates and terms proceeding for section 118 is not the only CARP proceeding likely to take place during 2002. Other proceedings will include distribution of cable, satellite, and digital audio royalties, as well as rate adjustment proceedings for the digital performance license (section 114) and the mechanical license (section 115). It would be extremely difficult for the Office to conduct the precontroversy discovery phase of more than one of these proceedings simultaneously, therefore, the Library must conduct them sequentially.

Because of the number of CARP proceedings to be conducted in 2002, and the attending workload, selection of a date to initiate a section 118 rate setting proceeding is not dependent on the schedules of one or more of the participating parties, but must be weighed against the interests of all involved. The parties affected by section 118 are most likely aware that 2002 is a window year for the adjustment of terms and rates, and as described above, are being given a formal negotiation period to reach agreements. Because of the other proceedings which must be scheduled, the attending workload, and the need to manage the interests of all involved, the Library is announcing the precontroversy discovery schedule and arbitration period in this proceeding without seeking further comment from the participating parties. Start Printed Page 15416

B. Precontroversy Discovery Schedule and Procedures

Any party that has filed a Notice of Intent to Participate in the section 118 adjustment proceeding is entitled to participate in the precontroversy discovery period. Each party may request of an opposing party non-privileged documents underlying facts asserted in the opposing party's written direct case. The precontroversy discovery period is limited to discovery of documents related to written direct cases and any amendments made during the period.

The following is the precontroversy discovery procedural schedule with corresponding deadlines:

Filing of Written Direct CasesJuly 1, 2002.
Requests for Underlying Documents Related to Written Direct CasesJuly 11, 2002.
Responses to Requests for Underlying DocumentsJuly 17, 2002.
Completion of Document ProductionJuly 22, 2002.
Follow-up Requests for Underlying DocumentsJuly 29, 2002.
Responses to Follow-up RequestsAugust 5, 2002.
Motions Related to Document ProductionAugust 8, 2002.
Production of Documents in Response to Follow-up RequestsAugust 12, 2002.
All Other Motions, Petitions, and ObjectionsAugust 14, 2002.

The precontroversy discovery period, as specified by § 251.45(b) of the rules, begins on July 1, 2002, with the filing of written direct cases by each party. Each party in this proceeding who has filed a Notice of Intent to Participate must file a written direct case on the date prescribed above. Failure to submit a timely filed written direct case will result in dismissal of that party's case. Parties must comply with the form and content of written direct cases as prescribed in 37 CFR 251.43. Each party to the proceeding must deliver a complete copy of its written direct case to each of the other parties to the proceeding, as well as file a complete copy with the Copyright Office by close of business on July 1, 2002, the first day of the 45-day period.

After the filing of the written direct cases, document production will proceed according to the above-described schedule. Each party may request underlying documents related to each of the other parties' written direct cases by July 11, 2002, and responses to those requests are due by July 17, 2002. Documents which are produced as a result of the requests must be exchanged by July 22, 2002. It is important to note that all initial document requests must be made by the July 11, 2002 deadline. Thus, for example, if one party asserts facts that expressly rely on the results of a particular study that was not included in the written direct case, another party desiring production of that study must make its request by July 11, 2002; otherwise, the party is not entitled to production of the study.

The precontroversy discovery schedule also establishes deadlines for follow-up discovery requests. Follow-up requests are due by July 29, 2002, and responses to those requests are due by August 5, 2002. Any documentation produced as a result of a follow-up request must be exchanged by August 12, 2002. An example of a follow-up request would be as follows. In the above example, one party expressly relies on the results of a particular study which is not included in its written direct case. As noted above, a party desiring production of that study or survey must make its request by July 11, 2002. If, after receiving a copy of the study the reviewing party determines that the study heavily relies on the results of a statistical survey, it would be appropriate for that party to make a follow-up request for production of the statistical survey by the July 29, 2002, deadline. Again, failure to make a timely follow-up request would waive that party's right to request production of the survey.

In addition to the deadlines for document requests and production, there are two deadlines for the filing of precontroversy motions. Motions related to document production must be filed by August 8, 2002. Typically, these motions are motions to compel production of requested documents for failure to produce them, but they may also be motions for protective orders. Finally, all other motions, petitions and objections must be filed by August 14, 2002, the final day of the 45-day precontroversy discovery period. These motions, petitions, and objections include, but are not limited to, objections to arbitrators appearing on the arbitrator list under 37 CFR 251.4, and petitions to dispense with formal hearings under § 251.41(b).

Due to the time limitations between the procedural steps of the precontroversy discovery schedule, we are requiring that all discovery requests and responses to such requests be served by hand or fax on the party to whom such response or request is directed. Filing of requests and responses with the Copyright Office is not required.

Filing and service of all precontroversy motions, petitions, objections, oppositions, and replies shall be as follows. In order to be considered properly filed with the Librarian and/or Copyright Office, all pleadings must be brought to the Copyright Office at the following address no later than 5 p.m. of the filing deadline date: Office of the Register of Copyrights, Room LM-403, James Madison Memorial Building, 101 Independence Avenue, SE., Washington, DC 20540. The form and content of all motions, petitions, objections, oppositions, and replies filed with the Office must be in compliance with §§ 251.44(b)-(e). As provided in § 251.45(b), oppositions to any motions or petitions must be filed with the Office no later than seven business days from the date of filing of such motion or petition. Replies are due five business days from the date of filing of such oppositions. Service of all motions, petitions, objections, oppositions, and replies must be made on counsel or the parties by means no slower than overnight express mail on the same day the pleading is filed.

C. Initiation of Arbitration

Initiation of the proceedings before the CARP will commence on October 7, 2002, the first day of the 180-day arbitration specified in Chapter 8 of the Copyright Act. The schedule of the arbitration proceeding will be established by the CARP after the three arbitrators have been selected.

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Dated: March 27, 2002.

David O. Carson,

General Counsel.

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[FR Doc. 02-7809 Filed 3-29-02; 8:45 am]