Opinion ID: 788880
Heading Depth: 3
Heading Rank: 5

Heading: Broadcasters' challenge to reliance on the RIAA-Yahoo! agreement

Text: 42 The Broadcasters claim that the Librarian acted arbitrarily by adopting the CARP's use of the RIAA-Yahoo! agreement because it was not comparable to market rates. The Librarian must establish rates and terms that most clearly represent the rates and terms that would have been negotiated in the marketplace between a willing buyer and a willing seller. 17 U.S.C. § 114(f)(2)(B). In establishing such rates and terms, the [CARP] may consider the rates and terms for comparable types of digital audio transmission services and comparable circumstances under voluntary license agreements.... 17 U.S.C. § 114(f)(2)(B)(ii) (emphasis added). 43 The Broadcasters argue the RIAA-Yahoo! agreement is not comparable because it was negotiated in a nascent market controlled by an allegedly monopolistic group that employed market power to set fees it knew would be used as CARP evidence. Specifically, the Broadcasters claim that there was no direct evidence of a competitive market because the RIAA Negotiating Committee represented over 90% of all copyrighted sound recordings. Broadcasters point to the cartel's inability to conclude agreements with more than merely 26 of the hundreds of broadcasters in the marketplace, and its inability to reach agreement with any radio broadcaster, as evidence of its monopolistic power. Broadcasters' Br. at 21 (citing CARP Report at 50). 44 The Broadcasters' argument ultimately fails because it rests simply on a challenge to the merits of the Librarian's decision to rely on the RIAA-Yahoo! agreement as competitive. Again, we do not examine the correctness of the Librarian's decision regarding Yahoo!'s competitiveness or the weight the CARP afforded witnesses testifying about the RIAA-Yahoo! agreement, but question only whether the Librarian explained his decision on comparability in facially plausible terms according to record evidence. See NAB, 146 F.3d at 918. The Librarian discussed this issue at some length. See Final Rule, 67 Fed. Reg. at 45,246-56. 45 The Librarian noted that the RIAA-Yahoo! agreement merited significant weight because (1) Yahoo! was a successful and sophisticated business which, to date, had made well over half of all DMCA-compliant performances; [and] (2) it had comparable resources and bargaining power to those RIAA brought to the table. Id. at 45,248. The Librarian did not merely parrot the CARP's conclusions, but criticized the weight it gave to the RIAA-Yahoo! agreement's rate distinction between webcasting and simulcasting. Id. He concluded that the different rates do not actually represent the parties' understanding of the value of the performance right for these types of transmissions, but resulted from other interests of the parties during negotiations. Id. at 45,248, 45,251. The Librarian also cited record facts supporting a finding that the Yahoo! agreement was statutorily comparable, noting RIAA's assertions that many webcasters affirmatively stated that Yahoo! is a competitor and that the number of the performances made by Yahoo! on its Internet-only channels is roughly equivalent to the number of performances made by the other webcasters in this proceeding.... Id. at 45,249. The Librarian's consideration of the record evidence and explanation of his reasoning are certainly facially plausible and sufficient to withstand our exceptionally deferential review. NAB, 146 F.3d at 918, 930. 46