Sunday, July 15, 2007

Federal Court Denies Motion to Stay Webcasting Royalty Decision

The U.S. Court of Appeals for the District of Columbia Circuit yesterday denied all motions to stay any aspect of the ruling by the Copyright Royalty Judges (CRJs) on the new rates webcasters are required to pay recording artists and record labels. SoundExchange is pleased that, for the second time, the original decision by the CRJs is left to stand on its merits, and this time by a completely independent judicial body. While the general appeal will still proceed in due course, yesterday's ruling means that recording artists and content owners can move forward confident that they will receive fair pay for their hard work in producing music for all to enjoy.

Congress, with the near unanimous support of the webcasting industry, established the CRJs in 2004. Three independent judges -- with expertise in copyright, economics and law -- met for 18 months, heard exhaustive testimony from all sides and set fair rates of compensation for those who make the music and those who use it. "The court's decision is a reminder of the extremely thorough and thoughtful process by which the new royalty rates were set," said Michael Huppe, General Counsel of SoundExchange. "While the overall appeal will still proceed, yesterday's ruling is yet another indication by an independent judicial body that the original decision is sound," added Huppe.

While this decision fully validates the rates set by the CRJs, SoundExchange is mindful of the need to nurture the growth of the Internet radio industry. That is why SoundExchange has offered to extend 1998-era below market rates to small commercial webcasters, and to keep rates at 2003 levels for thousands of non-commercial webcasters. This would mean that the vast majority of Internet services would have no rate increase of any kind from 1998-2010. Additionally, SoundExchange is in active negotiations with the Digital Media Association and others with respect to a cap on minimum fees.

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