Thursday 19 June 2008

US internet radio royalties hit further obstacles

In a feature carried by Lexology ("Does the Copyright Royalty Board exist? Internet radio appeal proceeds and new issues arise"), David Oxenford (Davis Wright Tremaine LLP) reviews the current role of the US Copyright Royalty Board in the light of its position on the royalties paid for the use of sound recordings by internet radio stations. In an appeal against one of its decisions the Department of Justice (which represents the Board before the Court of Appeals) maintained that the submissions of the webcasters -- who naturally wish to minimise their exposure to copyright royalties -- had provided insufficient factual basis upon which to establish that the Board's decision was arbitrary, capricious or otherwise contrary to law.

The Board's constitutional status has however now been called into question by Royalty Logic (which seeks to establish itself as an alternative collection agency to SoundExchange). If the Court of Appeals decides to hear that issue and agrees that the Board was not properly appointed, we can expect re-appointments, fresh hearings and possibly even legislative intervention, all of which seriously delays the ability of rights holders to factor their royalty income into their business plans.

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