Hard Times for Copyright Royalty Board Judge

“Our responsibility is to implement a system that will more closely reflect a judicial process” rendering rate- setting and royalty distributions more predictable and familiar to parties involved, Sledge told us. Congress killed CARP because lawmakers wanted a more appropriate system for deciding “matters of such critical national importance” that have “vast implications on the commercial development of this country,” Sledge said. The webcasting case involves the RIAA, Yahoo, Clear Channel, NPR and other major broadcast and Internet players.

The statutory change came with passage of the Copyright Royalty & Distribution Reform Act, which created the board, changed the licensing and royalty landscape and set the CRB at the Library of Congress (LoC). Space there is limited; when CRB’s courtroom came up for remodeling, the trial halted. Sledge hopes to resume by July 26 if a courtroom is found. Litigants offered to help find a temporary perch, but the CRB demurred. “It’s important for the courtroom to be a government courtroom… not some conference room in some law office that would be a very different environment,” Sledge said.

CRB’s scant resources irk those close to the webcasting case. The board has a tiny staff and virtually no room for viewing copious transcripts and exhibits, sources told us. The law that created CRB authorized 3 judges, a copyright royalties specialist, a senior attorney and a mid-level attorney, Sledge said. The specialist was in place when Sledge and colleagues Stanley Wisniewski and William Roberts began work. The mid-level lawyer started last week. The CRB is readying a want ad to fill the vacant senior attorney slot, Sledge said. Even with a partial staff, it was important for the board to begin its work, he said: “Everybody has been waiting 2 years for us to get here, the backlog is great and we're not waiting for anything. We're pushing this as hard and as fast as we can.” The CRB also has the job of distributing royalties the govt. has collected.

Accessing court documents has been daunting, sources said. The trial is public but scheduling information isn’t publicized. Trial transcripts are available for inspection on-site at CRB, but little material on the CRB and its work is online. After the trial, an official written record will be available for review -- by appointment, CRB’s website said. CRB judges’ offices aren’t in the same building as the court documents, Sledge said.

Onlookers may have had unrealistic expectations for the proceeding, Sledge told us. “A trial is not that well organized in advance. The parties change their witnesses as emergencies or demands of particular witnesses develop,” he said: “We may not know until several days in advance who a witness will be and last minute changes occur.” That makes it hard to publicize details of the proceeding, he said. Post-9/11 security hampers access to CRB documents, especially in a building so close to the U.S. Capitol, he said.

Sledge was to meet Wed. with LoC staff to talk about how to set up electronic filing and viewing of CRB documents, now only in paper form, he said. The retired U.S. Dist. Court, Birmingham, bankruptcy judge said when he implemented digital record-keeping on his last job it took “hundreds of millions of dollars” and nearly a decade. CRB’s system need not be as complex but it won’t come easily, he said, predicting it will take a year to get such a system in place. The arrangement he envisions would let parties’ attorneys file paperwork and get notices in real time and offer the public and press access to CRB documents via Internet.

Despite hurdles, it’s too early to say if Congress gave the CRB enough resources, Sledge said. The board needs more experience with different types of proceedings, he said. Webcasting is particularly complex, involving many parties, increasing the trial’s demands, he said: “I couldn’t go back to Congress at this point and say they have to increase the staff… because they'd say, ‘Well, you've got 3 or 4 months of experience and one proceeding. How can you tell how that will play out over the lifetime of the CRB?'”

CRB has seen “stresses” in the webcasting case -- especially since judges had only the royalty specialist for staff, Sledge said: “We're being very aggressive in trying to conduct this proceeding, and at the same time, we're trying to create new agency in the government. In an ideal world you'd create your agency first and then start your trials. We're trying to do all of it at the same time.” CRB has many of the growing pains the Dept. of Homeland Security (DHS) had, but DHS could rely on other agencies, Sledge said. “We've had strong support within the Library of Congress but its resources are limited. It doesn’t have any excess to give us,” he said.

Besides the webcasting case, the CRB has 4 other proceedings pending. The board also wants to start distributing royalties held by the govt. to parties awaiting compensation, Sledge said. The lion’s share of the money has been generated from satellite and cable system licenses. Distribution has dragged due to royalty seekers’ inability to show “sufficient records” to justify payouts, he said: “That accounting process by the parties is much slower than we would like.” CRB wants funds distributed within 90 days of enactment but stakeholders’ record-keeping processes can’t keep pace. “There’s a billion dollars in the accounts waiting to be distributed,” Sledge told us. If litigants can’t agree that they're ready for a CRB proceeding, “we can, and at some point we may, have to schedule the trial and proceed even before we hear from them,” he said.

A proceeding involving Sec. 115 of the Copyright Act, on digital uses of content subject to compulsory licensing, also awaits trial. Litigants indicated no urgency and have asked the CRB to “put that at the end of the line,” Sledge said. A CRB calendar using statutory timeframes for all proceedings should be public around Labor Day, Sledge said.