Music Choice v. Copyright Royalty Bd., No. 13-1174 (D.C. Cir. 2014)Annotate this Case
“Musical work” and the owner’s exclusive right to perform the work in public are protected by 17 U.S.C. 106(4). Broadcast of a musical work is a performance and requires a license from the copyright owner. Copyright Act amendments afford the copyright owner of a sound recording “the narrow but exclusive right ‘to perform the copyrighted work publicly by means of a digital audio transmission.’” The law requires “certain digital music services . . . to pay recording companies and recording artists when they transmit sound recordings” and provides for appointment of three Copyright Royalty Judges. If sound recording copyrights owners are unable to negotiate a royalty with digital music services, the Judges may set reasonable rates and terms. The Judges set royalty rates and defined terms for statutorily defined satellite digital audio radio services (SDARS) and preexisting subscription services (PSS). SoundExchange, which collects and distributes royalties to copyright owners, argued that the Judges set rates too low and erred in defining “Gross Revenues” and eligible deductions for SDARS. A PSS that provides music-only television channels appealed, arguing that PSS rates were set too high. The D.C. Circuit affirmed, concluding that the Judges of the Board acted within their broad discretion and on a sufficient record.