please the court my name's paul fact work on council for music choice i'd like to reserve three minutes for both i would like to focus on the two threshold birds that music choice identified next briefing related to the corporate world the board's ruling that music choices internet transmissions to the extent they were received by subscribers outside of their homes or entirely excluded from the scope of the preexisting such which in service license the st of those threshold errors was the board taking up the issue all in the st place at no time during the proceeding to the sound exchange ask for a ruling that these internet transmissions work outside the scope of the license to the contrary sound exchange expressly disclaimed any ruling on that point what they were already doing was that the judges should set a separate rate for the can simply say if the issues present that doesn't mean of the register specifically interpreted that presented language that your honor just referenced as requiring that the very reason the register rejected the word thorough in that case is because that theory had not been presented by the could be presented other than by the body the registry focused on on the parties now that yes my point ye it the register was was very specific about this and focused on the problem of the problem of this presents when the judges are the ones who come up now there are ways you write or i want to agree with you as the concern is  the judges in all instances completely bound by the scope of what the court has put in an order in the proceeding there are circumstances and even someone devotional claimants this court noted that the judges have various ways to the the hearings go on typically five weeks there are multiple opportunities where the court if they identify a threshold issue that the parties have not raised for them to request that the parties address those issues and in fact it is a very active bachelor i can tell you having done several of these proceedings if you read the transcript and this b s or is proceeding you will see a good percentage of the time of the hearing is devoted to the judge's questions so i think this is not a case that presents that issue but i would agree with your honor in a case like that if the judges raise the issue from the point is have the opportunity to develop factual record on that point then it would be appropriate and i think i suppose it's only whether the judges have the authority to set a different type of structure for the wait for work casters that was a legal question that was a purely legal question was referred to the register and the register rejected so what if the i don't know the details of that  actually but the register it's something the register decided whatever the register decided there but here the register decided to entertain the question well just because the register erick is time doesn't mean we d can't review every it's not present and he said you classified it as precedent scope not only of referrals to the register but which is intertwined with the notion of what the judges can consider when they form then doing their final determination and notably it's important you're not talking about our case you're talking about a case webcast and for proceeding after the register ruled in this fashion in the final determination the judges themselves noted the registers ruling they reiterated that they thought that there was evidence in the record that had been submitted by the corys for a very different purpose that they thought could have supported this ruling that they wanted to make but they noted that in light of the registers the ruling that the interpretation of that other so even the judges in that proceeding understood the register to be limited in that sense and they acknowledged it would be an arbitrary and capricious to shut go searching through the record that had been a step to stab without reference to this new argument and trying to map that evidence onto this new argument without giving the parties the opportunity to introduce additional evidence and at least contextualize them and that's exactly what the judges did he service to refer to exclude mobile apps not internet outside the homes but mobile  not the case that we have no i don't i mean as an hypothetical yes you know really you never answer hypothetical question by saying that's not this case once one judge alito was sitting here and the lawyer said that he and in particular of look at the distinction between section one hundred and fourteen d to be versus d to see these are two sets of rules of clothing for a licensee that takes advantage of section fourteen this is one of the right at the register a rule that in this very proceeding that the key distinction is whether it is what the register consider an existing service offering an expanded service or that the register would have had to have started at least started in the same way of saying how because your respect we believe what the register was doing was coming up with a legal test result we haven't you or i was talking about how do we determine what service means this is how the register chose to do it and i think the rest  i let's assume you're right about that the mobile labs didn't exist in ninety so all of the register had interpreted service to include to exclude that but the register acknowledged that part of the statute as saying in an existing service offering you're allowed to adapt and change as it was for example a bit of the ready to give example of cable that just because cable was part of the technology behind cable transmissions at the you just can't let out the app so it's a different product basically what's wrong with that that seems like another bit of the to use the word i used that obtains a different program it is it is good for you know i apologise for going to new technologies in norway and that's the distinction the problem is that by excluding internet all internet transmissions by the way which is what the register all internet transmissions are you know outside  proceeding and then starting at the next city the rate standard is going to change but there's not that's all i'm talking about of the rates is it is it preexisting spooking services a category one man it's still going to have grandfathered programming rules like i was talking about before and it's still going to have a separate perceiving it's going to be out in a different time than being on pretty existing cable and satellite television services but what we're talking about in this case as rates and with respect to broader the ruling in this case than just the rates to i thought there was a distinction between existing and expanded right and that and that and the and the only thing that the board decided because the register has as a matter of law can't be existing so the only question and the only reason we have a six pack of test is to then determine between the next two to write and the board helped that to the extent these internet transmissions are received inside the home and by the way that would apply to apps used inside the home as well they're within the statute but they declined to set a separate form but to the extent they're received outside the home they're completely outside over both the rate standard and the programming rules and anything  very clear there were three services the risk muzak d m x and dish and music music choice and in acts and music choice offered a cable and satellite subscription service there was no internet disputing for the purpose of this litigation that music choice as a business may have made internet transmissions but that does not mean that any internet transmissions were part of the grandfathered preexisting subscription service the this that i think there are a couple of things in this actually that are worth pointing out so the st is certain preexisting subscription services defined in section one of them or jerry levin and it says it has to be a service with a subscription service in particular and it is very obvious from the you know the way that we have talked about the service now that we've got to trace the service was its cable and satellite service i think i think the nd aspect of this is that the n reason why it least in this respect the existing service the thing that congress was trying to grandfather which may expand in ways including to the internet in certain limited limited respects but the very core of the service does not include the internet as evidence scene which is the new medium lays out a number of new distinction or a new conditions that have to apply to spew that you know that music choice was what is transmitting over the  again music choices business the entity the business entity may have been making internet transmissions but that does not mean that that's part of the core service that was grandfathered in that well based on what not interfere with digital rights management software to not allow their consumers to search chicks scan and copy music these are conditions that congress designed in order to prevent internet in copyright infringement through using such person services in a very odd yucaipa why would that mean that some internet services are not grandfathered into the statute you know the fact that new services may preexisting subscription service that's operating it says in the same medium has these historical conditions but if they expand into a new medium that they have to comply with all these days which the movie to the new media would be the internet here the new providing not only internet service but providing a house on the home so i think that the it i am not sure i know the legislative history was at one point the definition of service right that the preexisting subscription service definition in jail of an as this court identified in music is ambiguous but it's also i mean we're not breaking new ground here everyone has recognized up until this point including this court that there are only three existing services and the statute doesn't identify three services but that is something that this work and the register have long understood to drill under your nose the statute which you think grandfather in internet transmissions to always have every internet transmission because it's the same medium always fall within and the d to beat conditions but it would only be the internet transmissions by a provider who was was broadcasting through the internet for you know during the roman time period it would be all of new internet services it would be existing internet services why would that be so strange so i think the answer to that question is again congress was legislating against this administrative backdrop in which the royalty proceeding had just concluded before the statute that royalty proceeding involved only three services was only cable and satellite imagery was a factual matter that music choice was transmitting by internet but there's no reason to think that the administrative proceeding took account of internet transmissions at all it was tethered soley to cable and satellite transmission that's correct and that is what it may be true that music twice as a business was making internet transmissions but it's service it's a church and service the way it talked about it the way the copyright owners talked about it during the arbitration proceeding was a cable and satellite service and so when congress wrote the d two conditions the distinction between the same medium and a different medium it was ensuring that if anyone were to use any of these three services were to expand beyond those transmission mediums that were identified as their core existing service to for example one of these services only transmitted in satellite if they were to expand into either cable or internet that would be subject to the new conditions there's nothing in the statute that indicates a level granny right so music choice was broadcasting over the internet maybe the internet offerings were small but nothing in the statute suggests that it matters how much they were doing before the a grandfather so nothing in particular about the definition of j eleven mentions degree that's true but again we're not breaking new ground everyone has understood this term to be extremely limited to these three bills as the court recognized news that these three businesses and the three program offerings that they were making at that time and the three program offer and this the reason that we have limited it in this way is because that was those were the three businesses who participated in the arbitration system for one of those three businesses here and we have one of the services that they were providing at the time we have their will and music are the cable and sally subscription service which was what was happening at the time but that was not you know it doesn't it's and it was neither internet nor was it in mobile application which is an entirely as sport questions have recognized an entirely separate problem which is that the mobile application does not resemble at all anything like even what they allege they were doing in one thousand and one dollars is the difference the actual practical difference between the internet transmission and cable and satellite transmission if all  right and what is the difference about the something that was being transmitted over the internet as opposed to something that was being transmitted over cable which is when i think i think the as a just a fundamental matter no one was subscribing to a separate internet service known was what i can say is that the reason this grandfather provision was created was to protect the three businesses and the three services who had received a lower rate in the copyright arbitration royalty panel to allow them to continue with those operations i'm distracted by changes in the digital licensing scheme and when to include other transmissions in a different medium that was not  for their internet transmission yes and and so i wanted to be very clear that up until this point we've been talking about look at one end but yes it is if we would like to move to book a tour which i'm happy to answer questions about  you know the discussion with respect to bucket two is has music choice for me to its core cable and satellite service available that same service available on the internet and if so then it would fall into a bucket too but it's very obvious from the facts that have been presented both during the hearing and in the rehearing that it was sent to the judges that music choice has offered a different service are always going to be a number of different factors because this is a fact trying to figure out whether something is the same service is a fact intensive inquiry and you can expand even within the same transmission medium and still be a different service i and eight or what to the degree to which things were available outside the home register just said this is something that when you're considering this question is a worthy factor and in fact when it was sent to the judges the judges recently concluded that this mobile application was not available until after the act of the statute it has greatly increased the amount of it will believe internet portably in mobile applications on tablets and this registrar's legal interpretation same transmission that and that we sever parts of order based that were based on that legal determination and i think you if you believe to the registers legal interpretation were incorrect because the statute is unambiguous then the appropriate remedy i think would be to remain and to the copyright royalty judges to reconsider their factual analysis in light of  suggesting severance would be inappropriate so as not i'm not sure what would be severed because the judge is right the judges made their determination based on the referral from the register and said this is the test that we think there will no longer be a lower rate for any preexisting subscription services and what i believe what opposing counsel said was that they would like to continue to use the pre interpreted to include within the core existing service the internet because that would mean that the fact that a company that may have had a subscription service made internet transmissions before  lower rates but the great the rates are expiring the conditions themselves are the things the transmissions by subscription services have to do so the difference between historically what had to happen was you just had to ensure that you which everyone else has to comply with and which the preexisting situation service is supposed to comply with if they expand into the internet include things like do not have a digital rights management do not allow people to scan and use it on you or when you're playing it you know there are seven more conditions that are supposed to happen i think music choices position is that it should not have to do that for any of its internet transmissions even though congress clearly intended for the preexisting subscription services that expanded into any new medium including the internet to comply with these conditions so the conditions continue in the way you read it is the additional conditions continue to exist going forward but there is no possibility of getting the as a theoretical matter but it certainly is and if i could i would that you should this way and i will explain why to determine whether something is ambiguous or not it's a pretty straightforward test looked at taxed with the structure and look to background the structure in this case as we've already discussed is one in which congress imposed additional conditions for internet transmissions for can do or transmission that would be over the internet those conditions do not apply to a true preexisting service in its original form that at least creates ambiguity and then when you look to the legislation i don't understand we say that again certainly if you look at how congress did it up the different among the different services the bucket won't service yet as you're referring to it is exempt from certain requirements that are imposed on us on services that transmit over the internet and by that i mean archiving and the other things that my colleague was talking about those conditions are designed to constrain internet service what my friend on the other side is saying is that when congress did that they nevertheless wanted this suppos preexisting internet service to be free of that i think frankly that we use any ambiguity that at a minimum it means that the statues in big us and if we look at the legislative history there is no doubt congress said as clear as a bell that the preexisting services that was talking about the bucket when services were satellite and cable services and not only that it defined them in contradistinction to internet services in the muzak case there what we're talking about here is that you know the congress intended to limit to grandfather the city services in the scene transmission medium and to any new service isn't a new transmission medium we're only transmission similar to the existing service were provided that nd half of what they're talking about which is where the internet might come in is a bucket to kind of question my friends the primary submission they made today and i heard them arguing is that they're a bucket one service and that how is it so clear from the statutory taxed right you're talking about a conference report you're talking about what they intended but what about the text of the statute so the tax so we're talking about the word service that what i have  convince you that there is some ambiguity there doesn't necessarily have to be completely foreclosed and there's an attachment that the conditions are in the text that's exactly right the conditions are in the tax and the background of course against which congress legislated registers opinion is that the grandfather and clause and one of the sources and muzak was intended to be narrow and should be narrowly construed going to protect preexisting investments where the registrar pointed out was whatever this internet service was assuming that it existed at all it was so inconsequential that the the arbitration panel did not make note of it the library did not make note of it congress not making over that and so if we're talking about grandfathering to protect existing into it who is the i don't dispute the general proposition that bucket two services are entitle to the more favorable rate standard but whether something is bucket two or not comes down to whether it is similar enough to what was before what was similar to the way you define similar enough under the registers opinion are six non binding but i think quite sensible drawn from the legislative tax legislative history factors in terms of does it substitute doesn't provide functionality and those types of considerations at that level the question for this court is that the judges the c r being abused their discretion their substantial discretion in these kinds of way the end of the legislative history not only affirmatively defined services to the cable satellite but expressly distinguishes them from later competitive burgeoning internet services and that makes perfect sense because there was no substantial or consequential internet service on the horizon although we know that we know that because the car when it was talking about it did not and do not talk about preexisting services that way with the services that were before play we know that we know that that's the case because when the librarian reviewed it did not disturb the definition of the services and cable satellite said that there really facing competition from the internet and the conference report is exactly the same way this is really an easier case i think than the music case because whatever ambiguity was floating around there all signs point in the same direction here that those internet services are not pocket one they could be bucket t that they're not in the category existing are you saying that the register couldn't conclude that that any internet transmission is with an existing even though music choice was making internet transmissions in  refer to the registers conclusion as well as to what sort of history that's but do you think it's so clear that the register couldn't make that couldn't conclude that internet transmissions were part of the things that were being offered in  and therefore some internet transmissions are within existing what we'll argue to the rooster when the case went out was that the statute yes the answer your question is yes and our  primary submissions of the registering that we don't need to go this far to win the case is that existing does not include internet if there is an be beauty then we do everything that we were just talking about here nine years  there why this thing does not include internet as a matter of law is what tax structure in history the tax if you look at this and at what congress was doing what it was dividing up how it was going to the requirements it was going to impose on existing services versus the requirements it was going to impose on buckets too and going for services bucket one is exempt from the internet and internet related programs yeah sure and what it says it is if you want to get a favorable treatment as a buffer to provider you cannot make a programs available to the user which is a concept that works very well on the internet you know anyone can go on the internet and was in total you know five symphonies in a row or five pop songs a row has no bearing for  cable and satellite transmissions there's also technical provisions that are a little hard to explain but if the court goes through the other provisions and see you find that there are rights management  visions that are again only makes sense in the context of an internet service don't make any sense in the context of the south and what do you say about the point that was originally about a drought that even if all that is true about internet services it doesn't necessarily have to do with internet services provided by one of the three preexisting entities as opposed to an internet service provided by somebody else it's a fair point but i think it puts us in the world of what the congress really needs and there with the point if you look at the actual statute if you look at the actual statute what the way you determine which apply is the statutory language in the transmission to be amused by the service of nine hundred and ninety eight here's the certain things they can't play too many songs by the same or mr roboto as some other there are various technical features they have to comply with with the program but the point is those were already up of all there was no separate category for internet prior to nine hundred and ninety eight dollars and so congress decided for the services whatever they were doing at that time that's how we're going to determine which set restrictions going forward so there's nothing in that structure that would cause you to move away from the language of the statute that tells you exactly how you're supposed to determine that and it's a factual issue and i think you know the legislative history it's important to remember there were no fact findings associated with that legislative history there were not hearings far as the music case is concerned that presented entirely different issues than this case ok the question of transmission medium was not in the case but let the statutory language that's important here or the d to be a language transmission prospect of an internet service is not at all clear whether congress was referring to that as we were talking about his bucket one above the two i agree with your honor that this the legislative history is  far from clear which is yet another reason that it certainly shouldn't be used to change the texas statute thank you and justice scalia once referred ironically to using ambiguous legislat