Groups Say Copyright Office Lacks Section 115 Rulemaking Authority
Only Congress can fix the universally acknowledged shortcomings in the Copyright Act’s section 115 compulsory license for musical works, industry groups told the Copyright Office in comments. CTIA, the NAB and Google’s YouTube said in separate filings that the office would exceed its statutory authority were it to proceed in the rulemaking. They join the majority of commenters who have urged the office to put the brakes on the rulemaking or otherwise leave alone “ancillary issues” such as the status of buffer and server copies (CD Sept 2 p3). Performing rights organizations said they were concerned the office was straying beyond section 115’s core focus of mechanical licensing royalties.
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The office is authorized only to set regulations “for the administration of the functions and duties” specifically listed in the statute, CTIA said. That includes a “carefully circumscribed procedure for commenting” on issues at the Copyright Royalty Board but not interpreting section 115. The Supreme Court has made clear that “there is no default presumption of implicit authority” or allowance for agencies to claim “broad interpretive and regulatory authority based on a specifically limited grant,” the NAB said. It noted Registrar of Copyright Marybeth Peters’ regular appeals to Congress to fix the license.
Federal appeals courts are clear in their definition of licensed “phonorecords,” which exclude any content of “transitory” duration, NAB and CTIA said, noting the 2nd U.S. Appeals Court’s recent ruling against the licensing of remote-DVR services. That led the Copyright Office to extend the comment period (CD Aug 12 p14). The 4th U.S. Appeals Court in Richmond, Va., in CoStar similarly rejected digital- transmission buffers in RAM as requiring a license, they each said. The office’s claims about buffer copies “would wreak havoc with other carefully crafted provisions of the Act” that differentiate among performance, reproduction and distribution rights, NAB said. The group again pointed to Peters’ 2006 testimony, where she said treating streaming as a “distribution” was “factually and legally incorrect.” The office made an “unexplained and inexplicable 180-degree about-face” in its proposal, NAB said. CTIA noted the Senate’s 1995 report on extending licensing to digital downloads, which said “the intention is not to substitute for or duplicate performance rights.”
Section 115 isn’t worth reforming, NAB and CTIA said. They both cited Peters’ well-known description of the license as an “antiquated statutory scheme” whose shortcomings have made its use “almost non-existent.” The office’s stated desire to make section 115 a “safe harbor” for streaming- media companies to use to guard against royalty claims by publishers will only make it harder for streaming companies to claim fair use in court, CTIA said. “Courts have held that the existence of a license structure weighs against a fair use claim,” NAB said, citing 2nd Circuit and decisions by the 6th U.S. Appeals Court. Verizon filed comments that appeared substantially similar to NAB’s -- both were filed by the Wiley Rein law firm.
Performing rights organizations BMI and ASCAP were the most supportive filers of the office’s proceeding but nonetheless had concerns. “The PROs applaud the Office’s narrowness of focus” in declining to decide the “interrelationship” between the section 115 and performance rights licenses, while also recognizing the “mechanical right” in streaming activities.
But BMI and ASCAP said the office’s rulemaking may have an “inadvertent or unintended effect on the performance right,” for example, by implying that a “performance” can’t happen if a computer can’t specifically identify “each part of a stream.” Defining a performance is outside the office’s authority, they said, and “any statements made by the Office concerning any part of the Copyright Act may be given deference by courts and other decision-making bodies,” even if the office doesn’t intend any legal consequences.