810 Federal Register / Vol. 89, No. 4 / Friday, January 5, 2024 / Notices 

1Nothing set forth in this section of the Notice 

of Commencement should be construed as a 

statement by the Judges as to how they will 

ultimately rule as to any evidence or testimony 

proffered with regard to, inter alia, admissibility, 

competency, relevancy, probative value or weight 

or dispositive effect, as to any issue, or whether 

they will or will not ultimately consider, accept, or 

adopt any argument made in response to this 

section. Additionally, nothing in this section 

should be construed as an indication that the Judges 

will or will not ultimately consider any of the 

issues set forth herein or addressed by the 

Participants in response to this invitation in any 

determination rendered by them. Further, by 

soliciting information regarding these issues, the 

Judges are not indicating that they have reached any 

preliminary decisions as to any of these issues. 

Further, to avoid doubt, the interest among the 

Judges as expressed herein does not necessarily 

relate to any other statutory licenses. 

request permission to participate by 

submitting a short statement. 

Please note the Secretary’s Office will 

accept only electronic filings during this 

time. Filings must be made through the 

Commission’s Electronic Document 

Information System (EDIS, https://

edis.usitc.gov). No in-person paperbased filings or paper copies of any 

electronic filings will be accepted until 

further notice. 

Written submissions.—As provided in 

§§ 201.8 and 207.15 of the 

Commission’s rules, any person may 

submit to the Commission on or before 

5:15 p.m. on January 24, 2024, a written 

brief containing information and 

arguments pertinent to the subject 

matter of the investigations. Parties shall 

file written testimony and 

supplementary material in connection 

with their presentation at the conference 

no later than noon on January 18, 2024. 

All written submissions must conform 

with the provisions of § 201.8 of the 

Commission’s rules; any submissions 

that contain BPI must also conform with 

the requirements of §§ 201.6, 207.3, and 

207.7 of the Commission’s rules. The 

Commission’s Handbook on Filing 

Procedures, available on the 

Commission’s website at https://

www.usitc.gov/documents/handbook_

on_filing_procedures.pdf, elaborates 

upon the Commission’s procedures with 

respect to filings. 

In accordance with §§ 201.16(c) and 

207.3 of the rules, each document filed 

by a party to the investigations must be 

served on all other parties to the 

investigations (as identified by either 

the public or BPI service list), and a 

certificate of service must be timely 

filed. The Secretary will not accept a 

document for filing without a certificate 

of service. 

Certification.—Pursuant to § 207.3 of 

the Commission’s rules, any person 

submitting information to the 

Commission in connection with these 

investigations must certify that the 

information is accurate and complete to 

the best of the submitter’s knowledge. In 

making the certification, the submitter 

will acknowledge that any information 

that it submits to the Commission 

during these investigations may be 

disclosed to and used: (i) by the 

Commission, its employees and Offices, 

and contract personnel (a) for 

developing or maintaining the records 

of these or related investigations or 

reviews, or (b) in internal investigations, 

audits, reviews, and evaluations relating 

to the programs, personnel, and 

operations of the Commission including 

under 5 U.S.C. Appendix 3; or (ii) by 

U.S. government employees and 

contract personnel, solely for 

cybersecurity purposes. All contract 

personnel will sign appropriate 

nondisclosure agreements. 

Authority: These investigations are 

being conducted under authority of title 

VII of the Tariff Act of 1930; this notice 

is published pursuant to § 207.12 of the 

Commission’s rules. 

By order of the Commission. 

Issued: December 29, 2023. 

Susan Orndoff, 

Acting Attorney Advisor. 

[FR Doc. 2024–00034 Filed 1–4–24; 8:45 am] 

BILLING CODE 7020–02–P 

LIBRARY OF CONGRESS 

Copyright Royalty Board 

[Docket No. 23–CRB–0013–NSR (2026– 

2030)] 

Determination of Rates and Terms for 

Digital Performance of Sound 

Recordings by New Subscription 

Services and Making of Ephemeral 

Copies To Facilitate Those 

Performances (NSS V) 

AGENCY: Copyright Royalty Board (CRB), 

Library of Congress. 

ACTION: Notice announcing 

commencement of proceeding with 

request for petitions to participate. 

SUMMARY: The Copyright Royalty Judges 

(Judges) announce commencement of a 

proceeding to determine reasonable 

rates and terms for digital performance 

of sound recordings by new 

subscription services and the making of 

ephemeral recordings to facilitate those 

performances for the period beginning 

January 1, 2026, and ending December 

31, 2030. The Judges also announce the 

date by which a party wishing to 

participate in the rate determination 

proceeding must file its Petition to 

Participate and the accompanying $150 

filing fee. 

DATES: Petitions to Participate and the 

filing fee are due no later than February 

5, 2024. 

ADDRESSES: The petition to participate 

form is available online in eCRB, the 

Copyright Royalty Board’s online 

electronic filing application, at https:// 

app.crb.gov/. 

Instructions: The petition to 

participate process has been simplified. 

Interested parties file a petition to 

participate by completing and filing the 

petition to participate form in eCRB and 

paying the fee in eCRB. Do not upload 

a petition to participate document. 

Docket: For access to the docket, go to 

eCRB, the Copyright Royalty Board’s 

electronic filing and case management 

system, at https://app.crb.gov/ and 

search for docket number 23–CRB– 

00013–NSR (2026–2030). 

FOR FURTHER INFORMATION CONTACT: 

Anita Brown, CRB Program Specialist, 

(202) 707–7658, crb@loc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

Under the Copyright Act, the 

Copyright Royalty Judges (Judges) must 

commence a proceeding every five years 

to determine reasonable rates and terms 

to license the digital transmission of 

sound recordings by new subscription 

services and the making of ephemeral 

recordings to facilitate those 

transmissions. See 17 U.S.C. 112(e), 

114(d)(2), 803(b)(1)(A)(i)(III), 

804(b)(3)(A), 37 CFR 383. This notice 

commences the rate determination 

proceeding for the license period 2026– 

2030. 

Scope of Proceeding 

In addition to all other submissions 

and arguments required by the Act and 

the applicable regulations, and in 

addition to any other submissions or 

arguments that the Participants choose 

to make, there is an interest among 

certain Judges in receiving evidence, 

testimony, and argument relating to the 

allocation of the royalty payments 

required by the Judges’ determination in 

this proceeding between the section 112 

ephemeral recordings royalties and the 

section 114 sound recording royalties.1

Accordingly, the Judges invite 

Participants, within their written direct 

statements, written rebuttal statements, 

proposed findings of fact, conclusions of 

law and briefing, through their 

witnesses and attorneys, as appropriate, 

to consider addressing the following 

questions. 

Question #1 

Does the ephemeral license created by 

section 112 have economic value 

independent of any economic value in 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 89, No. 4 / Friday, January 5, 2024 / Notices 811 

2 ‘‘Perfect complements’’ are goods that are 

always consumed together in fixed proportions. H. 

Varian, Intermediate Microeconomics at 40 (8th ed. 

2010). Thus, a purchaser of perfectly 

complementary goods ‘‘wants to consume the goods 

in the same ratio regardless of their relative price.’’ 

P. Krugman & R. Wells, Microeconomics at 306 (3d 

ed. 2013) (emphasis added). (Each noninteractive 

service or New Subscription Service (‘‘NSS’’) 

requires both the section 112 ephemeral license and 

the section 112 sound recording license in order to 

transmit any sound recording, thus making the 

fixed proportion (ratio) equal to 1:1 for these 

licenses.) The irrelevancy of ‘‘relative price’’ 

between these perfect complements referenced by 

Krugman & Wells underscores the indeterminacy of 

the royalties attributable to each license which 

underlies the Judges’ present inquiries. 

the digital public performance of sound 

recording license (‘‘sound recording 

license’’) created by section 114 and, 

reciprocally, does the sound recording 

license created by section 114 have 

economic value independent of any 

economic value in the ephemeral 

license created by section 112? 

Regarding this Question #1, the 

Judges note the following language in 

the Web V Determination: 

SoundExchange and the Services are 

generally on the same page regarding 

ephemeral recordings, except as to the 

question whether the right to make 

ephemeral recordings has independent 

economic value. Compare SX PFFCL ¶ 1570 

(and sources cited therein) (‘‘ephemeral 

copies have economic value to services that 

publicly perform sound recordings because 

these services cannot, as a practical matter, 

properly function without those copies’’) 

with Services RPFFCL ¶ 1570 (and sources 

cited therein) (‘‘While the Services do not 

dispute that ephemeral recording right is 

frequently needed, it does not have 

independent economic value.’’). 

Web V Final Determination, 86 FR 

59542, 59584 n. 351 (Oct. 27, 2021), 

aff’d. National Religious Broadcasters 

Noncommercial License Committee v. 

Copyright Royalty Bd., 77 F.4th 949 

(D.C. Cir. 2023) (emphasis added). 

Among the Judges, there is an interest 

in obtaining the Participants’ positions 

on this Question #1 in the context of the 

economic characterization of the 

relationship between the section 112 

ephemeral license and the section 114 

sound recording license. In particular, 

the Judges inquire whether the parties 

identify these two licenses as perfect 

complements.2

The Web V Determination indicates 

that participants in that proceeding 

were cognizant of the irrelevancy of the 

‘‘relative price’’ (i.e., the royalty) for 

these two licenses, and thus their 

perfect complementarity: 

As to the specific allocation of royalties 

between the performance and ephemeral 

recording rights, SoundExchange notes that 

this allocation has no effect on the Services. 

See SX PFFCL ¶ 1574. . . . ‘‘[T]he willing 

buyer’’ (i.e., the music service) ‘‘is 

disinterested with respect to that allocation 

. . . .’’ 

Web V Determination, 86 FR 59584 

(emphasis added). 

Accordingly, the Judges invite the 

Participants to address this Question #1 

in their proffered evidence, testimony, 

and/or arguments. 

Question #2 

Are agreements in the interactive 

marketplace or other unregulated 

markets informative (and, if so, to what 

extent) as to the allocation of royalties 

between the section 112 ephemeral 

license and the section 114 sound 

recording license? 

Regarding this Question #2, the 

Judges are mindful of the absence of any 

statutory requirement in unregulated 

markets that specifies percentages of the 

sound recording royalties to be 

distributed to sound recording artists, 

non-featured vocalists and musicians, 

and (if Letters of Direction are issued) to 

producers, mixers and sound engineers. 

In prior proceedings, evidence was 

proffered regarding such agreements. 

The Judges take note of the following 

portion of the Web V Determination: 

‘‘Most of these agreements do not set a 

distinct rate for those ephemeral copies, 

incorporating them instead into the overall 

rate that the [music services] pay[ ] for the 

combined ephemeral copy rights and 

performance rights.’’ Id. at 11–12. Dr. Ford 

also testified that to the extent marketplace 

agreements do set a royalty rate for 

ephemeral recordings they generally express 

that rate as a percentage of an overall 

bundled rate for both performances and 

ephemerals. See Ford Des. WDT at 12–14. 

SoundExchange also offers several direct 

licenses in the record of this proceeding as 

evidence that marketplace agreements do not 

set distinct rates (as distinguished from 

bundled rates) for ephemeral recordings. See, 

e.g., Trial Ex. 4035 at 11–12, 16–19 (2015 

Agreement . . .); Trial Ex. 5037 at 3–4, 5–9 

(2017 Agreement . . .) 

Web V Determination, 86 FR 59584. 

Accordingly, the Judges invite the 

Participants to address this Question #2 

in their proffered evidence, testimony, 

and/or arguments. 

Question #3 

Can and should the Judges rely on 

agreements containing provisions 

regarding splits of royalties between the 

section 112 ephemeral license and the 

section 114 sound recording license if 

the agreements described by witnesses 

or referenced in other documents are 

not proffered as evidence in this 

proceeding? 

This question is of interest because, in 

Web V, the Judges received evidence 

and testimony that such an agreement 

existed as between the sound recording 

companies and the performing artists’ 

representatives, but that agreement was 

not proffered and thus not record 

evidence. Specifically on this issue, the 

Web V Determination describes the 

testimony of a SoundExchange witness: 

[T]he SoundExchange board of directors, 

which is comprised of record company and 

performing artist representatives ‘‘adopted a 

resolution reflecting agreement that 5% of 

the royalties for the bundle of rights should 

be attributable to the Section 112(e) 

ephemeral royalties, with the rest being 

allocated to the Section 114 performance 

royalties.’’ Bender WDT ¶ 56. 

SoundExchange avers that ‘‘[a]s a result, a 

95%–5% split ‘credibly represents the result 

that would in fact obtain in a hypothetical 

marketplace negotiation between a willing 

buyer and the interested willing sellers under 

the relevant constraints.’ ’’ 

Web V Determination, 86 FR 59584. 

However, the Judges noted in the Web 

V Determination that ‘‘[t]he 

SoundExchange Board resolution 

reflecting the agreement between artists 

and copyright owners is not in the 

record [and] testimony concerning the 

agreement, therefore, is hearsay, but the 

Judges exercise their discretion under 

37 CFR 351.10(a) to admit and consider 

this hearsay testimony.’’ Web V 

Determination, 86 FR 59584 n.352. 

This Question #3 raises the following 

subsidiary questions: 

Is an internal resolution by 

SoundExchange an ‘‘agreement’’? 

If the resolution references an agreement, 

should both the resolution and the 

agreement, if memorialized in writing, be 

proffered as evidence? 

Is an agreement made by members of the 

SoundExchange Board of Directors a 

marketplace agreement between willing 

parties? 

Is such an agreement reflective of a process 

in which the parties to the agreement have 

bargaining power sufficient to generate an 

agreement reflective of effective competition? 

Do the Board members voting on the 

agreement and resolution on behalf of the 

sound recording companies have a sufficient 

number of votes to approve or defeat the 

agreement and resolution if they all voted 

identically? 

Do the Board members voting on the 

agreement and resolution on behalf of the 

artists and others entitled to a share of the 

section 114 royalties have a sufficient 

number of votes to approve or defeat the 

resolution if they all voted identically? 

Should the Judges exercise their discretion 

to admit hearsay testimony regarding such 

agreements and resolutions, or should the 

Judges require production of the agreements 

and resolutions? 

Does the Best Evidence Rule require 

production of the actual agreements and 

resolutions described above? 

Accordingly, the Judges invite the 

Participants to address this Question #3 


lotter on DSK11XQN23PROD with NOTICES1
812 Federal Register / Vol. 89, No. 4 / Friday, January 5, 2024 / Notices 

1Nothing set forth in this section of the Notice 

of Commencement should be construed as a 

statement by the Judges as to how they will 

ultimately rule as to any evidence or testimony 

proffered with regard to, inter alia, admissibility, 

competency, relevancy, probative value or weight 

or dispositive effect, as to any issue, or whether 

they will or will not ultimately consider, accept, or 

adopt any argument made in response to this 

section. Additionally, nothing in this section 

should be construed as an indication that the Judges 

will or will not ultimately consider any of the 

issues set forth herein or addressed by the 

Participants in response to this invitation in any 

determination rendered by them. Further, by 

soliciting information regarding these issues, the 

Judges are not indicating that they have reached any 

preliminary decisions as to any of these issues. 

Further, to avoid doubt, the interest among the 

Judges as expressed herein does not necessarily 

relate to any other statutory licenses. 

in their proffered evidence, testimony, 

and/or arguments. 

Question #4 

Does the marketplace evidence 

indicate how the Judges should consider 

allocation of royalties as between the 

section 112 ephemeral license and the 

section 114 sound recording license, 

including allocations to sound recording 

artists, non-featured vocalists and 

musicians, or to producers, mixers and 

sound engineers, pursuant to section 

114? Among the Judges, there is a 

concern whether—with section 114, 

unlike section 112, providing for an 

allocation of 50% of the section 114 

royalties to artists (and others, in certain 

circumstances), as described above— 

evidence and the law may lead the 

Judges to apportion royalties as between 

the section 112 and 114 licenses in a 

manner that effectuates the section 114- 

mandated split of royalties in a manner 

that is legally and economically 

appropriate. 

Accordingly, the Judges invite the 

Participants to address this Question #4 

in their proffered evidence, testimony, 

and/or arguments. 

Petitions To Participate 

Parties with a significant interest in 

the outcome of the rate proceeding and 

wish to participate in the proceeding 

must provide the information required 

by § 351.1(b) of the Judges’ regulations 

by completing and filing the Petition to 

Participate form in eCRB. Parties must 

pay the $150 filing fee when filing each 

Petition to Participate form. Parties must 

use the form in eCRB instead of 

uploading a document and must comply 

with the requirements of § 351.1(b)(1) of 

the Copyright Royalty Board’s 

regulations. 37 CFR 351.1(b)(1). 

Only attorneys admitted to the bar in 

one or more states or the District of 

Columbia and members in good 

standing will be allowed to represent 

parties before the Judges. Only 

individuals may represent themselves 

and appear without legal counsel. 37 

CFR 303.2. 

The Judges will address scheduling 

and further procedural matters after 

receiving petitions to participate. 

Dated: December 20, 2023. 

David P. Shaw, 

Chief Copyright Royalty Judge. 

[FR Doc. 2023–28515 Filed 1–4–24; 8:45 am] 

BILLING CODE 1410–72–P 

LIBRARY OF CONGRESS 

Copyright Royalty Board 

[Docket No 23–CRB–0012–WR (2026–2030)] 

Determination of Rates and Terms for 

Digital Performance of Sound 

Recordings and Making of Ephemeral 

Copies To Facilitate Those 

Performances (Web VI) 

AGENCY: Copyright Royalty Board (CRB), 

Library of Congress. 

ACTION: Notice announcing 

commencement of proceeding with 

request for petitions to participate. 

SUMMARY: The Copyright Royalty Judges 

(Judges) announce commencement of a 

proceeding to determine reasonable 

rates and terms for two statutory 

licenses permitting the digital 

performance of sound recordings over 

the internet and the making of 

ephemeral recordings to facilitate those 

performances for the period beginning 

January 1, 2026, and ending December 

31, 2030. The Judges also announce the 

date by which a party wishing to 

participate in the rate determination 

proceeding must file its Petition to 

Participate and pay the accompanying 

$150 filing fee. 

DATES: Petitions to Participate and the 

filing fee are due no later than February 

6, 2023. 

ADDRESSES: The petition to participate 

form is available online in eCRB, the 

Copyright Royalty Board’s online 

electronic filing application, at https:// 

app.crb.gov/. 

Instructions: The petition to 

participate process has been simplified. 

Interested parties file a petition to 

participate by completing and filing the 

petition to participate form in eCRB and 

paying the fee in eCRB. Do not upload 

a petition to participate document. 

Docket: For access to the docket, go to 

eCRB, the Copyright Royalty Board’s 

electronic filing and case management 

system, at https://app.crb.gov/ and 

search for docket number 23–CRB– 

0012–WR (2026–2030). 

FOR FURTHER INFORMATION CONTACT: 

Anita Brown, CRB Program Specialist, 

at (202) 707–7658 or crb@loc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

Under the Copyright Act, the 

Copyright Royalty Judges (Judges) must 

commence a proceeding every five years 

to determine reasonable rates and terms 

to license the digital transmission over 

the internet of sound recordings and the 

making of ephemeral recordings to 

facilitate those transmissions. See 17 

U.S.C. 112 (e), 114(d)(2), 

803(b)(1)(A)(i)(III), 804(b)(3)(A), 37 CFR 

380. This notice commences the rate 

determination proceeding for the license 

period 2026–2030. 

Scope of Proceeding 

In addition to all other submissions 

and arguments required by the Act and 

the applicable regulations, and in 

addition to any other submissions or 

arguments that the Participants choose 

to make, there is an interest among 

certain Judges in receiving evidence, 

testimony, and argument relating to the 

allocation of the royalty payments 

required by the Judges’ determination in 

this proceeding between the section 112 

ephemeral recordings royalties and the 

section 114 sound recording royalties.1

Accordingly, the Judges invite 

Participants, within their written direct 

statements, written rebuttal statements, 

proposed findings of fact, conclusions of 

law and briefing, through their 

witnesses and attorneys, as appropriate, 

to consider addressing the following 

questions. 

Question #1 

Does the ephemeral license created by 

section 112 have economic value 

independent of any economic value in 

the digital public performance of sound 

recording license (‘‘sound recording 

license’’) created by section 114 and, 

reciprocally, does the sound recording 

license created by section 114 have 

economic value independent of any 

economic value in the ephemeral 

license created by section 112? 

Regarding this Question #1, the 

Judges note the following language in 

the Web V Determination: 

SoundExchange and the Services are 

generally on the same page regarding 

ephemeral recordings, except as to the 

question whether the right to make 

ephemeral recordings has independent 

economic value. Compare SX PFFCL ¶ 1570 

(and sources cited therein) (‘‘ephemeral 


lotter on DSK11XQN23PROD with NOTICES1