[Federal Register Volume 83, Number 234 (Thursday, December 6, 2018)]
[Notices]
[Pages 62908-62909]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-26494]


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LIBRARY OF CONGRESS

Copyright Royalty Board

[Docket Nos. 2012-6 CRB CD 2004-2009 (Phase II) and 2012-7 CRB SD 1999-
2009 (Phase II)]


Distribution of Cable and Satellite Royalty Funds

AGENCY: Copyright Royalty Board, Library of Congress.

ACTION: Final distribution determination.

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SUMMARY: The Copyright Royalty Judges (Judges) announce the final 
distribution of satellite royalty funds for the year 2000. The 
distribution determination results from a contested motion by the 
Settling Devotional Claimants (SDC) requesting that the Judges order a 
final distribution to the SDC of 100% of the Devotional Claimants' 
share of the 2000 satellite royalties.

DATES: Applicable date: December 5, 2018.

ADDRESSES: The final distribution order is also published in eCRB at 
https://app.crb.gov/. Docket: For access to the docket to read 
submitted background documents, go to eCRB, the Copyright Royalty 
Board's electronic filing and case management system, at https://app.crb.gov/ and search for docket number 2012-6 CRB CD 2004-2009.

FOR FURTHER INFORMATION CONTACT: Anita Blaine, CRB Program Specialist, 
by telephone at (202) 707-7658 or email at [email protected].

SUPPLEMENTARY INFORMATION: 
    On October 1, 2018, the Judges issued an initial determination 
relating to the requested distribution. The Register of Copyrights 
concluded her statutory review and issued no opinion. The Order is now 
before the Librarian of Congress for final review and publication. The 
essence of the initial determination follows.
    On November 21, 2017, the Settling Devotional Claimants (SDC) filed 
a motion seeking final distribution of the 2000 satellite royalty fund 
in the Devotional category (Motion). In the Motion, the SDC contended 
that there is no controversy with respect to the subject satellite 
royalties. The SDC argued that the direct cases filed by the SDC and 
Independent Producers Group (IPG) in this consolidated proceeding 
confirm that both parties agree to the allocation of 100% of the 2000 
satellite royalties to the SDC. As a result, the SDC asked the 
Copyright Royalty Judges (Judges) to order a final distribution to SDC 
in an amount equal to the Devotional Claimants' share of the 2000 
satellite royalty fund. Motion at 1-2.
    On December 1, 2017, IPG filed an opposition to the SDC's motion 
(IPG Opposition). IPG conceded that the written testimony of both IPG 
and the SDC conclude that ``subject to the current rulings of the 
Judges,'' IPG has no valid claim to satellite royalties for the year 
2000. See IPG Opposition at 1. Nevertheless, IPG noted that it disputes 
and will appeal the Judges' claims rulings. Id. at 2. IPG continued:

    [I]f appellate review of the Judges' dismissal of 51 claims held 
by IPG-represented claimants is reversed as an excessive discovery 
sanction, as IPG contends, then the relative value of the 
previously-dismissed claims will require reconsideration for any 
award to IPG of 2000 satellite royalties. Under such circumstance, 
IPG will likely be awarded a substantial portion of the 2000 
satellite royalties, and final distribution of 2000 satellite 
royalties will necessarily require repayment from the SDC of 
royalties with an attributed interest rate. Id. at 3.

In light of the value IPG projected for its dismissed claims should 
they be reinstated, IPG maintained that distribution to SDC would be 
``imprudent.'' Id. at 3-4.
    In their response (Response), the SDC noted that the Judges have 
twice rejected IPG's requests for rehearing of the order in which the 
Judges dismissed IPG's claims to 2000 satellite royalties. Response at 
2. In the SDC's estimation, IPG has had full and fair opportunities to 
state its case to the Judges, and an appeal to the Court of Appeals is 
unlikely to succeed. Id.
    Moreover, the SDC noted that the Judges addressed the identical 
situation with respect to the 2008 satellite royalties, and the Judges 
ordered a final distribution of the Devotional Claimants' share to the 
SDC. Id., citing Order Granting Final Distribution of 2008 Satellite 
Royalties for the Devotional Category, Dkt. No. 2012-7 CRB SD 1999-2009 
(Phase II) (Dec. 22, 2015). In response to IPG's concerns regarding the 
SDC's repayment of royalties should IPG prevail on appeal, the SDC 
noted that they have executed the royalty repayment agreement required 
by the Library of Congress prior to any partial distribution of royalty 
funds. Response at 3. The SDC added:

    All devotional ministries that are members of the SDC in the 
relevant period are bound by that obligation. How the remission 
might be accomplished is the responsibility of the SDC, which are 
among the largest religious ministries in the United States. 
Collectively, they would be fully capable of meeting any obligation 
to the Library . . . . To suggest otherwise is without foundation.

Response at 3.

    Section 801(b)(3)(A) of the Copyright Act states that the Judges 
may authorize distribution of royalty fees deposited pursuant to 
Section 119 of the Copyright Act if they find that the distribution is 
not subject to controversy. 17 U.S.C. 801(b)(3)(A). In the current 
proceeding, the parties agree that the Judges have dismissed all claims 
that IPG-represented claimants had to satellite royalties for 2000 in 
the Devotional category. As a result, the SDC are the only claimants in 
the proceeding with valid claims to satellite royalties for 2000 in the 
Devotional category. Therefore, in the current circumstances, satellite 
royalties for 2000 in the Devotional category are no longer in 
controversy.
    In November 2008, the parties to this proceeding filed a motion 
seeking partial distribution of 98% of the satellite royalty funds 
deposited for royalty years 1999 through 2003. In that motion, the 
parties designated specific

[[Page 62909]]

amounts of the proposed two percent reserve to be allocated among 
Program Suppliers claimants, Sports claimants, and Devotional 
claimants. In their motion, the moving parties represented that they 
had reached a settlement with regard to royalty category allocation. 
The moving parties maintained that the allocation settlement was non-
precedential and confidential. Because the moving parties maintain the 
confidentiality of the allocation shares, however, the Judges have no 
way to allocate the reserved funds among the categories with continuing 
controversies.
    By Order dated December 8, 2008, the Judges ordered distribution of 
90% of the satellite royalty funds deposited for royalty years 1999 
through 2003. While the Judges ordered ten percent of the royalty funds 
to be held in reserve, they did not allocate the reserve among the 
categories with remaining distribution controversies. See Order 
Granting in Part . . . Partial Distribution . . ., Dkt. Nos. 2008-5 CRB 
SD 1999-2000, 2005-2 CRB SD 2001-03 at 2-3 (Dec. 8, 2008) (Phase I 
Order). To direct execution of this final determination, therefore, the 
Judges must first know the exact dollar amount they should order 
disbursed to the SDC to complete the distribution.
    The Judges therefore Grant the Motion as to the percentage of 
distribution.\1\
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    \1\ This finding is based on IPG's lack of compensable claims 
and not on expert valuation of the relative value of SDC's and IPG's 
respective claims to 2000 satellite royalties. See Order Granting 
Final Distribution of 2008 Satellite Royalties for the Devotional 
Category, Docket No. 2012-7 CRB SD 1999-2009 (Phase II) (Dec. 22, 
2015).
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    The Judges Further Order that this final distribution determination 
is without prejudice to the parties' right to appeal the Judges' 
interlocutory ruling in this consolidated proceeding with regard to 
both cable and satellite claims issues.
    The Judges Further Order the Phase I Claimants jointly to notify 
the Judges and the Licensing Division no later than seven days after 
the date of publication of this Determination of the percentage of 2000 
satellite royalty funds that was allocable to the SDC as of December 8, 
2008.
    The Judges Further Order the Licensing Division of the Copyright 
Office, based upon the percentage allocable to the SDC provided by the 
Phase I Claimants, to calculate the dollar amount that is available to 
be distributed from 2000 satellite royalty funds to the SDC by taking 
the principal balance as of December 8, 2008, as reported jointly by 
the remaining categories of claimants to 2000 satellite royalty funds, 
adjusting that balance for a proportional deduction of administrative 
fees, and adding the interest accrued on the Devotional category 
balance from and after December 8, 2008. The Licensing Division shall 
provide the result of its calculation to the Judges and to the Phase I 
Claimants. The SDC may then request that the Judges distribute those 
funds to complete the final distribution.
    The Register of Copyrights (``Register'') has concluded her 
statutory review. The Librarian of Congress shall review and cause this 
final determination, and any correction thereto by the Register, to be 
published in the Federal Register.
    October 1, 2018.
    So Ordered.
    Suzanne M. Barnett, Chief United States Copyright Royalty Judge.
    David R. Strickler, United States Copyright Royalty Judge.
    Jesse M. Feder, United States Copyright Royalty Judge.

    Dated: November 7, 2018.
Suzanne M. Barnett,
Chief United States Copyright Royalty Judge.

Approved by:

Carla B. Hayden,
Librarian of Congress.
[FR Doc. 2018-26494 Filed 12-4-18; 8:45 am]
 BILLING CODE 1410-72-P