[Federal Register Volume 60, Number 54 (Tuesday, March 21, 1995)]
[Notices]
[Pages 14971-14976]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6831]



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LIBRARY OF CONGRESS

Copyright Office
[Docket No. 94-3 CARP-CD90-92]


Distribution of 1990, 1991 and 1992 Cable Royalty Funds

AGENCY: Copyright Office, Library of Congress.

ACTION: Notice of consolidation of proceedings, request for notices of 
intent to participate, and precontroversy discovery schedule.

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SUMMARY: The Copyright Office of the Library of Congress is 
consolidating the distribution of the 1990, 1991 and 1992 cable royalty 
funds into a single proceeding. Accordingly, the Office is requesting 
that claimants to the 1991 and 1992 royalty funds file a Notice of 
Intent to Participate in the distribution proceeding for those funds, 
if they have not already done so. The Office is also setting the 
prehearing schedule for the 1990-1992 distribution proceeding, 
including the date on which controversies will be declared and 
arbitration initiated.

DATES: Notices of Intent to Participate are due April 5, 1995.

ADDRESSES: If sent by mail, an original and five copies of the Notice 
of Intent to Participate should be addressed to: Copyright Arbitration 
Royalty Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC 
20024. If hand delivered, an original and five copies of the Notice of 
Intent to Participate should be brought to: Office of the Copyright 
General Counsel, James Madison Memorial Building, Room 407, First and 
Independence Avenue, S.E. Washington, DC 20540.

FOR FURTHER INFORMATION CONTACT: William Roberts, Senior Attorney, 
Copyright Arbitration Royalty Panel (CARP), P.O. Box 70977, Southwest 
Station, Washington DC 20024. Telephone (202) 707-8380. Telefax: (202) 
707-8366.

SUPPLEMENTARY INFORMATION:

I. Background

    Each year, cable systems submit royalties to the U.S. Copyright 
Office for a statutory license to retransmit broadcast signals to their 
subscribers. 17 U.S.C. 111. These royalties are, in turn, distributed 
to the appropriate copyright owners by means of a cable royalty 
distribution proceeding. These proceedings were formerly conducted by 
the Copyright Royalty Tribunal. However, on December 17, 1993, the 
Tribunal was abolished. Royalty distribution proceedings are now 
conducted by ad hoc copyright arbitration royalty panels (CARPs) 
convened and supported by the Library of Congress and the Copyright 
Office. Copyright Royalty Tribunal Reform Act of 1993, P.L. 103-198, 
107 Stat. 2304 (1993).
    At the time Congress was considering the abolition of the Tribunal, 
the Tribunal had already begun a proceeding to distribute the cable 
royalties that were collected in 1990. The 1990 cable royalty 
distribution proceedings began on April 2, 1993. 58 FR 17387 (April 2, 
1993). The proceeding did not, however, reach a conclusion. In light of 
the imminent passage of the Copyright Royalty Tribunal Reform Act, the 
Tribunal suspended the 1990 cable royalty distribution proceeding. 
Order, CRT Docket No. 92-1-90CD (October 14, 1993).
    The Copyright Royalty Tribunal Reform Act, which was effective 
immediately upon enactment, directed the Librarian and the Copyright 
Office to adopt the rules and regulations of the Tribunal found in 37 
CFR chapter 3, 17 U.S.C. 802(d), and provided that the Tribunal's 
regulations were to remain in effect until the Librarian adopts 
``supplemental or superseding regulations.'' The Office adopted the 
Tribunal's rules and regulations on an interim basis on December 22, 
1993, and notified the public that it intended to begin a rulemaking 
proceeding to revise and update those rules. 58 FR 67690 (December 22, 
1993). In one of the first decisions in that rulemaking, we considered 
the question of how to handle proceedings that were suspended because 
of the abolition of the Tribunal. The Office determined that matters 
left pending at the Tribunal would not be taken up where they had been 
left off, but would have to be begun anew. 59 FR 2550 (January 18, 
1994). The 1990 cable distribution would, therefore, start over from 
the beginning.
    We met with the cable copyright claimants on August 11, 1994 and 
were informed that they preferred to restart the 1990 cable 
distribution proceeding only after final regulations for the 
[[Page 14972]] CARPs were adopted and in place. The Office honored this 
request and, on December 7, 1994, published final regulations governing 
the conduct of royalty distribution and rate adjustment proceedings 
prescribed by the Copyright Royalty Tribunal Reform Act of 1993. 59 FR 
63025 (December 7, 1994).
    Cable royalties for the 1990, 1991, 1992 and 1993 account years are 
now eligible for distribution proceedings. A partial distribution of 
ninety percent of the 1990 and 1991 royalties was made by the Tribunal 
prior to its termination, and the Copyright Office has made a partial 
distribution of eighty percent of the 1992 and 1993 royalty funds. See, 
Distribution Order, CRT Docket No. 92-1-90CD, 57 FR 41478 (September 
10, 1992) (1990 royalties); Distribution Order, CRT Docket No. 93-4-
91CD (October 6, 1993) (1991 royalties); Order, Docket Nos. 94 CARP 
(92-CD) and 94 CARP (93-CD) (September 26, 1994) (1992 and 1993 
royalties).

II. Request for Comments on Controversy

    On December 15, 1994, the Copyright Office of the Library of 
Congress published a notice seeking comment as to the existence of 
controversies among claimants to the 1990 cable royalty fund. 59 FR 
64714 (December 15, 1994). We also requested interested claimants to 
file a Notice of Intent to Participate in the 1990 cable distribution 
proceeding.
    In addition to seeking comments regarding 1990 royalty fund 
controversies, we solicited comments as to whether the distribution of 
1990 cable royalties should be consolidated with other cable royalty 
funds collected in subsequent years. 59 FR 64715 (1994). The 1991, 1992 
and 1993 royalty funds are ready for distribution and could be made a 
part of the 1990 proceeding, if that would serve the public interest. 
If the claimants favored a consolidation, we sought comment as to the 
existence of controversies in those subsequent years. We also stated 
that if we did consolidate the 1990 cable distribution with one or more 
subsequent years, we would issue a request at that time for Notices of 
Intent to Participate for those subsequent years. 59 FR 64715.

The Comments

    The Office received comments from the following claimant groups: 
Program Suppliers, Joint Sports Claimants (consisting of the Office of 
the Commissioner of Baseball, the National Basketball Association, the 
National Hockey League and the National Collegiate Athletic 
Association), National Association of Broadcasters (NAB), Canadian 
Claimants, Devotional Claimants, Music Claimants (consisting of the 
American Society of Composers, Authors and Publishers; Broadcast Music, 
Inc.; and SESAC, Inc.), The Public Broadcasting Service (PBS), National 
Public Radio (NPR) and Multimedia Entertainment, Inc. (Multimedia). In 
addition to individual comments from these groups, the Office received 
a comment, styled ``Joint Comments of Copyright Owners'' (Copyright 
Owners), that expresses the collective opinion of all of the above 
listed claimant groups.

Discussion of the Comments

    The Copyright Owners identify existence of both Phase I and Phase 
II controversies for the 1990 cable distribution, and identify the 
existence of a Phase I controversy for the 1991 and 1992 royalty funds. 
They request a consolidation of the 1991 and 1992 distribution with the 
1990 proceeding, and propose a detailed schedule for the 45-day 
precontroversy discovery period. The Copyright Owners are not, however, 
in agreement as to when the precontroversy discovery period, and the 
initiation of arbitration, should begin.
    A. Existence of Controversies. Copyright Owners state that a 
controversy exists as to the Phase I allocation of the 1990 cable 
royalty fund. Copyright Owners, comments at 1-2. The Phase I parties 
agreed to settle the 1990 royalty claims of NPR, the Canadian Claimants 
and the Music Claimants. These settlements were approved by the 
Copyright Royalty Tribunal during the aborted 1990 cable distribution 
proceeding; therefore, no controversy exists with respect to the shares 
of the 1990 cable royalty fund for NPR, Canadian Claimants, and Music 
Claimants. See in CRT Docket No. 92-1-90CD: ``Distribution Order'' 
(dated March 29, 1993) (NPR); ``Distribution Order'' (dated July 27, 
1993) (Canadian Claimants); and ``Order'' (dated August 16, 1993) 
(Music Claimants).
    Copyright Owners also identify the existence of a controversy for 
the Phase I allocation of the 1991 and the 1992 cable royalties. Id. at 
2. Although there is a possibility that some of the claimants will 
reach a Phase I settlement, hearings before a CARP will nevertheless be 
required. Id.
    With respect to Phase II controversies, Copyright Owners ask that 
the Copyright Office schedule them after resolution of all Phase I 
controversies, and then conduct all Phase II proceedings concurrently. 
Id. at 3. Music Claimants urge that a separate CARP panel be convened 
to conduct each Phase II hearing. Music Claimants, comments at 7.
    Multimedia and NAB report the existence of Phase II controversies 
for the 1990 cable fund. Multimedia, comments at 1; NAB, comments at 1-
2. Several other commentators, including Program Supplier and Joint 
Sports Claimants, report that they are currently unaware of any Phase 
II controversies for the 1990 fund, but reserve the right to 
participate in such controversies should they arise. See Program 
Suppliers, comments at 1-2; Joint Sports Claimants, comments at 2. See 
also Canadian Claimants, comments at 2; Music Claimants, comments at 3-
4; Devotional Claimants, comments at 1. None of the commentators are 
aware of any Phase II controversies at this time for the 1991 and 1992 
cable royalty funds; however, they express an intention to participate 
in any Phase II controversies should they arise. See e.g. Program 
Suppliers, comments at 2; Music Claimants, comments at 5-6; Devotional 
Claimants, comments at 1.
    B. Consolidation of Proceedings. Copyright Owners request that the 
1990, 1991, and 1992 distribution proceedings be consolidated into a 
single proceeding. Copyright Owners, comments at 2. They state that 
consolidation is necessary to reduce the existing backlog in 
distribution proceedings, created by the elimination of the Copyright 
Royalty Tribunal, and that a proceeding which covers no more than three 
years would be manageable and cost effective for the parties and the 
CARP. Id. Copyright Owners do not, however, express any opinion as to 
the advisability of consolidating subsequent royalty funds (1993, 1994, 
etc.) into a single proceeding. Id. at 2-3.
    NAB supports consolidation of the 1990, 1991, and 1992 cable funds 
into a single proceeding, but only if the procedural dates and schedule 
proposed by Joint Sports Claimants is followed. See discussion, infra.
    C. Prehearing Schedule. Copyright Owners urge the Copyright Office 
to adopt a detailed prehearing scheduling order which addresses the 
following matters.
    1. Scheduling of proceeding. Section 251.45(b)(1) prescribes a 45-
day precontroversy discovery period for the handling of discovery and 
pre-arbitration matters. Copyright Owners propose that the Copyright 
Office adopt specific deadlines for the following procedural steps to 
take place within those 45 days:

Exchange of Written Direct Cases
Requests for Underlying Documents Related to Written Direct Cases 
[[Page 14973]] 
Responses to Requests for Underlying Documents
Completion of Document Production
Follow-up Requests for Underlying Documents
Responses to Follow-up Requests
Motions Related to Document Production to Date
Production of Documents In Response to Follow-Up Requests
All Other Motions, Petitions and Objections

Copyright Owners, comments at 4. In addition, Program Suppliers urge 
that parties should be free to file motions, particularly on discovery 
disputes, at any time up to the established deadline. The Librarian 
could then address each motion on an ad hoc basis, thereby expediting 
the decisionmaking process. Program Suppliers, comments at 4.
    2. Nature and scope of precontroversy discovery. Copyright Owners 
note that the rules describe the nature and scope of discovery 
permitted by a CARP, Sec. 251.45(c), but do not articulate any standard 
for precontroversy discovery. They therefore recommend that the same 
standard in Sec. 251.45(c) apply to the precontroversy discovery 
period, which would allow the parties to ``request of an opposing party 
nonprivileged underlying documents related to the written exhibits and 
testimony.'' Copyright Owners, comments at 5.
    3. Discovery and motions before the CARP. Copyright Owners voice 
concern that Sec. 251.45(c) requires the CARP to establish a discovery 
period following the submission of rebuttal and direct cases. They 
believe that allowing additional discovery on direct cases would be 
counterproductive to the purpose of the precontroversy discovery 
period, and that a CARP should only allow additional direct case 
discovery upon a showing of good cause. Copyright Owners, comments at 
5-6. Thus, all discovery requests that can be made during the 
precontroversy discovery period, and all motions and objections 
contemplated by Sec. 251.45(b), must be made at that time. Id.
    4. Manner of service. Because of what they view as a limited 
precontroversy discovery period, Copyright Owners recommend that 
service of all discovery requests and responses to such requests be by 
hand or fax on the party to whom the request or response is directed. 
Likewise, they propose that all motions and responses filed during the 
precontroversy discovery period be served by means no slower that 
overnight express mail. Copyright Owners, comments at 6.
    5. Start of evidentiary hearings. Copyright Owners request that a 
``sufficient'' time period be allowed from issuance of all 
precontroversy discovery rulings by the Copyright Office and the start 
of the 180-day arbitration period. Copyright Owners, comments at 6-7.
    D. Commencement of Proceedings. The commentators disagree as to 
when the precontroversy discovery period should begin and, 
consequently, when arbitration should be initiated. A majority of the 
commentators support the proposal of Joint Sports Claimants, who 
propose commencement of precontroversy discovery on August 18, 1995, 
and initiation of arbitration on October 30, 1995. Program Suppliers 
urge that precontroversy discovery begin on March 31, 1995, with the 
180-day arbitration period starting on June 7, 1995. Music Claimants do 
not endorse either position, but do not believe that precontroversy 
discovery should begin any time before ``mid-May.'' NPR takes a similar 
approach, favoring a June start.
    1. Program Suppliers proposal. Program Suppliers argue that an 
immediate start to the 1990 cable distribution proceeding is necessary 
to reduce the backlog of cable and satellite distributions and rate 
adjustments created by the elimination of the Copyright Royalty 
Tribunal. Program Suppliers, comments at 2. There have been no 
compulsory license hearings since the fall of 1993, and a number of 
proceedings are or will be ripe for decision:

--All cable compulsory license distribution cases from 1990 forward;
--All satellite carrier compulsory license distribution cases from 1992 
forward;
--The five-year cable royalty rate adjustment case under 17 U.S.C. 
801(b)(2) (A) and (D) and 803(a)(2) must be filed during 1995; and
--The satellite carrier fee negotiation and arbitration under 17 U.S.C. 
119(c) must begin on July 1, 1996 with initiation of arbitration no 
later than January 1, 1997.

Id. Program Suppliers concede that consolidation of the 1990, 1991, and 
1992 cable distribution proceedings will help to reduce this backlog, 
but only a combination of consolidation and prompt scheduling of 
hearings will bring all matters up-to-date. Id. at 3.
    Program Suppliers recommend that the 45-day precontroversy 
discovery period begin on March 31, 1995, and conclude on May 10, 1995. 
Arbitration would begin on June 7, 1995. Id. at 4-5. Program Suppliers 
argue that under this proposal, arbitration will be completed by 
December, thereby clearing the 1996 calendar for 1993 cable 
distribution, 1992 satellite distribution, and cable rate adjustment 
CARP proceedings, if necessary. Creating the scheduling possibility for 
two CARP hearings in 1996 by completing the 1990 cable distribution in 
1995 ``would help considerably to relieve the backlog that will exist 
at that time.'' Id. at 3.
    While Program Suppliers acknowledge that their proposed schedule is 
ambitious and will require hard work by the parties, they argue that it 
does not grant them any unfair advantage. They note that the Bortz 
study introduced by Joint Sports Claimants in the 1990 distribution 
proceeding before the Copyright Royalty Tribunal, the ``principal 
evidentiary presentation supported by all the parties in the 1990 
hearing other than Program Suppliers,'' contained data for 1990, 1991 
and 1992. Program Suppliers, however, have yet to receive their 
principal data, the Neilsen study, for those same years. Id. at 6.
    In addition to proposing precontroversy discovery and arbitration 
starting dates, Program Suppliers recommend specific dates for all 
precontroversy procedural deadlines proposed in the comments of 
Copyright Owners:

------------------------------------------------------------------------
                      Filing                              Deadline      
------------------------------------------------------------------------
Written Direct Cases..............................  Mar. 31, 1995.      
Request for Underlying Document Related to Written  Apr. 10, 1995.      
 Direct Cases.                                                          
Responses to Requests for Underlying Documents....  Apr. 14, 1995.      
Completion of Document Production.................  Apr. 20, 1995.      
Follow-Up Document Requests, If Any...............  Apr. 25, 1995.      
Responses to Follow-Up Requests...................  Apr. 28, 1995.      
Motions Related to Document Production to Date....  May 2, 1995.        
Completion of Document Production For Follow-Up     May 8, 1995.        
 Requests, If Any.                                                      
All Other Motions, Petitions, and Objections......  May 10, 1995.       
Commencement of the 180-day Period................  June 7, 1995.       
Start of Evidentiary Hearing......................  June 13, 1995.      
------------------------------------------------------------------------

Id. at 4-5. Program Suppliers envision that direct case hearings would 
be completed by August 4, and recommend that further hearings be 
suspended until at least September 6, 1995, during which time the 
parties would exchange rebuttal cases and conduct discovery of the 
rebuttal cases. Id. at 5. They further suggest that rebuttal hearings 
be completed by the end of September, and that proposed and reply 
findings of fact [[Page 14974]] and conclusions of law be briefed in 
October and early November so that ``the CARP decision could be issued 
by December 4, the last day of the 180-day period.'' Id.
    2. Joint Sports Claimants proposal. Joint Sports Claimants argue 
that Program Suppliers proposed schedule does not permit sufficient 
preparation time for a consolidated 1990-92 proceeding, and strongly 
opposes any schedule that would begin precontroversy discovery prior to 
August 18, 1995. They submit that a consolidated 1990-92 proceeding 
will be the most complicated in which the parties have ever 
participated, and will be before arbitrators ``who, presumably, will be 
selected for their expertise in dispute resolution rather than 
familiarity with cable copyright issues.'' Joint Sports Claimants, 
comments at 3. Adequate preparation time is, therefore, needed ``to 
locate witnesses, to commission and to complete research and to prepare 
testimony and exhibits.'' Id. at 4. Joint Sports Claimants further note 
that Program Suppliers' concern with the current backlog of proceedings 
is adequately addressed by consolidating the 1991 and 1992 cable 
distribution with the 1990 proceeding. Id. at 5.
    Joint Sports Claimants propose an August 18, 1995 start date for 
precontroversy discovery and an October 30, 1995 initiation of 
arbitration. They are supported in their commencement proposal by NAB, 
Devotional Claimants, Canadian Claimants and PBS. See NAB, comments at 
3-4; Devotional Claimants, comments at 2; Canadian Claimants, comments 
at 1; PBS, comments at 1. Joint Sports Claimants recommend the 
following dates for the precontroversy discovery procedural deadline 
schedule proposed in the comments of the Copyright Owners:

------------------------------------------------------------------------
                      Filing                              Deadline      
------------------------------------------------------------------------
Written Direct Cases..............................  Aug. 18, 1995.      
Requests for Underlying Documents Related to        Aug. 28, 1995.      
 Written Direct Cases.                                                  
Responses to Requests for Underlying Documents....  Sept. 1, 1995.      
Completion of Document Production.................  Sept. 8, 1995.      
Follow-Up Requests for Underlying Documents.......  Sept. 13, 1995.     
Responses to Follow-Up Requests...................  Sept. 18, 1995.     
Motions Related to Document Production............  Sept. 20, 1995.     
Production of Documents in Response to Follow-Up    Sept. 27, 1995.     
 Requests.                                                              
All Other Motions, Petitions and Objections.......  Oct. 2, 1995.       
Commencement of 180-Day Period....................  Oct. 30, 1995.      
------------------------------------------------------------------------

Id. at 2. Joint Sports Claimants do not make any scheduling proposals 
for the conduct of hearings before the CARP.
    3. Music Claimants and NPR. Music Claimants and NPR do not endorse 
the scheduling proposals of either Program Suppliers or Joint Sports 
Claimants. Music Claimants request that precontroversy discovery begin 
no sooner than mid-May 1995 to allow adequate preparation time for the 
written direct cases. Music Claimants, comments at 7. NPR requests a 
starting date no earlier than June, with hearings commencing no sooner 
than September. NPR, comments at 4.

III. Consolidation of Proceedings, Notices of Intent to 
Participate, and Scheduling

    Having fully considered the comments of the interested parties, the 
Copyright Office is consolidating the 1991 and 1992 cable royalty 
distribution with the 1990 distribution proceeding, and is requesting 
that interested parties, who have not already done so, file a Notice of 
Intent to Participate for the 1991 and 1992 distribution no later than 
April 5, 1995. The precontroversy discovery period will begin on August 
18, 1995, and proceed according to the schedule described below.

Consolidation of Proceedings

    The commentators report the existence of controversies for the 
1990, 1991 and 1992 cable royalty funds and request that the Copyright 
Office consolidate distribution of these funds into a single 
proceeding. Although the 1993 royalty funds are available for 
distribution, the commentators do not favor consolidation of the 1993 
funds. The Office believes that consolidation of the 1990, 1991 and 
1992 royalties into a single distribution proceeding is manageable and 
cost effective, and that addition of the 1993 funds to the proceeding 
may be unduly burdensome. Consolidation of three funds itself 
represents an unprecedented distribution, and is a major step towards 
eliminating the existing backlog of copyright compulsory license 
proceedings. We are, therefore, consolidating the 1990-92 cable royalty 
funds for distribution, and will conduct a single proceeding necessary 
to the resolution of all controversies related to these funds.
    By consolidating the 1990-92 distributions, the Office will handle 
Phase I and Phase II controversies in those funds sequentially. That 
is, we will first conduct a proceeding and convene a CARP to resolve 
all Phase I controversies for the 1990-92 funds, and, after that 
proceeding has been completed, we will ascertain the existence of any 
Phase II controversies and conduct separate proceedings. The issue of 
whether to convene separate CARPs for each Phase II controversy, or to 
allow a single CARP to resolve more than one controversy, will be 
decided at the time the Office determines the existence of Phase II 
controversies, if any.

Notices of Intent To Participate

    The Copyright Office has received Notices of Intent to Participate 
from the parties wishing to participate in the CARP proceedings for the 
1990 cable royalty distribution. The Office noted in the Notice 
requesting comments on the existence of cable distribution 
controversies that if it consolidated the 1990 cable distribution with 
one or more subsequent years it would then issue a request for Notices 
of Intent to Participate for those subsequent years. 59 FR 64714, 64715 
(1994).
    We are consolidating the 1991 and 1992 cable distribution with the 
1990 proceeding. Therefore, those claimants who wish to present 
evidence to the CARPs for distribution of the 1991 and 1992 royalties 
must, if they have not already done so, file a Notice of Intent to 
Participate for those years. Notices must be filed no later than April 
5, 1995. Failure to file a timely Notice of Intent to Participate may 
subject the claim to dismissal. The filing of a Notice of Intent to 
Participate is thus critical to a claimant being able to present an 
effective claim.

Scheduling of the 1990-92 Cable Distribution Proceeding

    The Copyright Office is announcing the scheduling of the 
precontroversy discovery period, and other procedural matters, for the 
1990-92 cable distribution proceeding. In addition, the Office is 
announcing the date on which the existence of controversies to the 
1990-92 cable funds will be declared and arbitration initiated, thereby 
commencing the 180-day arbitration period. Once a CARP has been 
convened, the scheduling of the arbitration period is within the 
discretion of the CARP and will be announced at that time.
    A. Commencement of the Proceeding. A royalty distribution 
proceeding under part 251 of 37 CFR is divided into two 
[[Page 14975]] essential phases. The first is the 45-day precontroversy 
discovery phase, during which the parties exchange their written direct 
cases, exchange their documentation and evidence in support of their 
written direct cases, and engage in the pre-CARP motions practice 
described in Sec. 251.45. The other phase is the proceedings before a 
CARP itself, including the presentation of evidence through live 
hearings and the submission of proposed findings by all of the parties. 
Both of these phases to a distribution proceeding require significant 
amounts of work, not just for the parties, but for the Librarian, the 
Copyright Office and the arbitrators as well. Selection of a date to 
commence a distribution proceeding is, therefore, not dependent on the 
schedules of one or more of the participating parties, but must be 
weighed against the interests of all involved.
    Because there are two phases to a distribution proceeding--
precontroversy discovery and arbitration--there are two time periods to 
be scheduled. The regulations do not provide how much time must 
separate precontroversy discovery from initiation of arbitration. 
Program Suppliers and Joint Sports Claimants, in their proposed 
schedules, both recommended a period of 28 days from the end of 
precontroversy discovery to the beginning of the 180-day arbitration 
period. See Program Suppliers, comments at 5; Joint Sports Claimants, 
comments at 2. The Copyright Office agrees that there is no reason to 
schedule an inordinate amount of time between the two; however, there 
must be adequate time for the Librarian to rule upon all motions filed 
within the 45-day precontroversy period. Since motions could, and 
undoubtedly will be filed on the last day of the period, a sufficient 
amount of time must be allowed to receive oppositions (7 days from 
filing of motion) and replies (5 business days from date of service of 
opposition), and to consider those motions and issue decisions and 
orders. Given these considerations, the uniqueness of cable 
distribution for the Office, and the complexities of the proceedings 
involving three years worth of royalties, we believe that a period of 
45 days between the end of the precontroversy discovery period and the 
declaration of controversies/initiation of arbitration is necessary for 
the Office to adequately complete its task.
    The issue remains as to what date precontroversy discovery should 
begin and, subsequently, initiation of arbitration. The commentators 
are divided. Program Suppliers believe that precontroversy discovery 
should begin at the end of March of this year to speed the reduction of 
royalty funds currently ripe for distribution, and to allow the 
scheduling of more than one CARP next year to handle distributions and/
or rate adjustments. The remainder of the commentators argue that a 
March starting time is premature because it does not allow sufficient 
preparation time for what will be the first CARP proceeding. Music 
Claimants and NPR favor commencement in mid-May and early June, 
respectively. Joint Sports Claimants state that they are opposed to any 
schedule which begins the 1990-92 cable distribution proceeding prior 
to August 18, 1995. They are supported by Devotional Claimants, 
Canadian Claimants, PBS, and NAB, whose support for consolidation of 
the 1991 and 1992 funds with the 1990 distribution is contingent upon 
acceptance of Joint Sports Claimants' proposed schedule.
    Because the commentators are so widely divided, the obvious 
compromise solution would be to split the difference in proposed 
starting dates. This would result in starting precontroversy discovery 
sometime in early June, which is NPR's proposal. However, in an open 
meeting of all parties filing Notices of Intent to Participate in the 
1990 distribution held at the Copyright Office, the parties expressed 
strong opposition to any compromise position, and urged the Office to 
select one of the proposed schedules. Meeting, held February 6, 1995. 
We are complying with the parties wishes and are selecting a starting 
date of August 18, 1995 for the 45-day precontroversy period. The 
period will conclude on October 2, followed by a 45-day period in which 
the Librarian and the Copyright Office will complete all precontroversy 
discovery matters and issue all rulings. Controversies will be 
declared, and the 180-day arbitration period initiated, on November 17, 
1995.
    There are several reasons for selecting these dates. First, this is 
the first cable distribution proceeding under the new CARP regime and 
the parties should be afforded adequate time for preparation of their 
cases and evidence. A majority of the parties stated that they need 
until August 18 to allow them sufficient time to prepare. Second, a 
single distribution proceeding for three royalty years is unprecedented 
and represents a highly complex and involved proceeding. The difficulty 
of the proceeding will be further heightened by the fact that it is the 
first test of the new CARP regulations governing cable distribution. 
We, therefore believe that the parties should have optimal preparation 
time to increase the likelihood of a smooth and efficient proceeding. 
Third, the Office wishes to avoid any scheduling conflicts with 
distribution proceedings of the 1992-94 DART royalty funds. We are 
currently seeking comment as to the existence of controversies for 
these funds, which are eligible for distribution after March 30, 1995. 
While it is anticipated that distribution settlements will be reached 
for these funds, convocation of a CARP or CARPs may nevertheless be 
necessary. It would be extremely difficult for the Office to conduct 
precontroversy discovery for cable as well as DART at the same time. An 
August 18 commencement date for cable distribution allows the Office to 
schedule a prior, nonoverlapping precontroversy discovery period for 
1992-94 DART distribution.
    B. Precontroversy Discovery Schedule and Procedures. Any party 
filing a Notice of Intent to Participate in the 1990-92 cable 
distribution for one or more of the royalty funds is entitled to 
participate in the precontroversy discovery period. Each party may 
request of an opposing party nonprivileged underlying documents related 
to the opposing party's written direct case. The precontroversy 
discovery period is limited to discovery of documents related to 
written direct cases and any amendments made during the period.
    Copyright Owners requested that the Copyright Office adopt a 
precontroversy discovery schedule that prescribes filing deadlines for 
discovery requests, responses and related motions. Because Copyright 
Owners believe their proposal is critical to an efficient and 
successful precontroversy discovery period, we will adopt it for 
purposes of this distribution proceeding.
    The following is the precontroversy discovery procedural schedule 
with corresponding deadlines:

------------------------------------------------------------------------
                      Action                              Deadline      
------------------------------------------------------------------------
Filing of Written Direct Cases....................  Aug. 18, 1995.      
Requests for Underlying Documents Related to        Aug. 28, 1995.      
 Written Direct Cases.                                                  
Responses to Requests for Underlying Documents....  Sept. 1, 1995.      
Completion of Document Production.................  Sept. 8, 1995.      
Follow-Up Requests for Underlying Documents.......  Sept. 13, 1995.     
Responses to Follow-Up Requests...................  Sept. 18, 1995.     
Motions Related to Document Production............  Sept. 22, 1995.     
[[Page 14976]]                                                          
                                                                        
Production of Documents in Response to Follow-Up    Sept. 27, 1995.     
 Requests.                                                              
All Other Motions, Petitions and Objections.......  Oct. 2, 1995.       
------------------------------------------------------------------------

    The Sec. 251.45(b) precontroversy discovery period begins on August 
18, 1995 with the filing of written direct cases. Each party to the 
proceeding must serve by hand on that day a complete copy of its 
written direct case on each of the other parties to the proceeding, as 
well as file a complete copy with the Copyright Office.
    After the filing of the written direct cases, document production 
will proceed according to the above-described schedule. Thus, the 
parties have until August 28 to request from one another Underlying 
Documents Related to Written Direct Cases, until September 1 to respond 
to Requests for Underlying Documents, and so forth. The dates listed in 
the schedule mark the deadlines by which the corresponding requests, 
responses and motions must be served and filed. In the case of document 
requests and all precontroversy discovery motions, failure to make a 
request or file a motion by the prescribed deadline precludes a party 
from making the request or filing the motion at a later date. For 
example, if a party fails to file a motion to compel production of 
Underlying Documents Related to Written Direct Cases by September 22, 
1995, that party is precluded from filing that motion at a later date 
with either the Copyright Office or the CARP. In the case of document 
production responses, it is expected that parties receiving requests 
will respond by the appropriate deadline. Motions to comply with the 
request may be filed beginning on the first day after the response 
deadline and up to the September 22 deadline for motions related to 
document production.\1\

    \1\Motions related to the September 27 Production of Documents 
in Response to Follow-Up Requests may be filed up to the October 2 
deadline for All Other Motions, Petitions and Objections.
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    Due to the time limitations between the procedural steps of the 
precontroversy discovery schedule, we are requiring that all discovery 
requests and responses to such requests be served by hand or fax on the 
party to whom such request or response is directed. A complete copy of 
the response or request shall also be served on the Copyright Office. 
Service via the mail, addressed to the official address in Sec. 251.1, 
is permissible.
    Filing and service of all precontroversy motions, petitions, 
objections, oppositions and replies shall be as follows. In order to be 
considered properly filed with the Librarian and/or Copyright Office, 
all motions, petitions, objections, oppositions and replies must be 
brought to: Office of the Register of Copyrights, Room 403, James 
Madison Memorial Building, 101 Independence Avenue, S.E., Washington 
D.C. 20540, between the hours of 9 a.m. and 5 p.m. Form and content of 
such motions, petitions, objections, oppositions and replies must be in 
compliance with Secs. 251.44(b)-(e). As provided in Sec. 251.45(b), 
oppositions to motions, objections and petitions must be filed with the 
Copyright Office no later than seven business days from date of filing 
of such motions, objections and petitions. Replies are due five 
business days from the date of filing of oppositions. Service of all 
motions, petitions, objections, oppositions and replies must be made on 
counsel or the parties by means no slower than overnight express mail 
on the same day the pleading is filed.

    Dated: March 13, 1995.
Marybeth Peters,
Register of Copyrights.
James H. Billington,
Librarian of Congress.
[FR Doc. 95-6831 Filed 3-20-95; 8:45 am]
BILLING CODE 1410-33-P