Memorandum of Law of Petitioner America Online, Inc. in Opposition
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i2MIR(VLRE&3 8P ~~ cCCÃ UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT GENERAL COUAISEL X OF COPYRIGHT IOMEDIA PARTNERS, INC. et al., Petitioners, Consolidated Cases Nos. 02-1244, 02-1245, 02-1246, 02-1247, 02-1248 Gild 02-1249 THE LIBRARIAN OF CONGRESS, Respondent. X MEMORANDUM OF LAW OF PETITIONER AMERICA ONLINE. INC. IN OPPOSITION TO RESPONDENT'S MOTION TO DISMISS PRELIMINARY STATEMENT Petitioner America Online, Inc. ("AOL") hereby submits this Memorandum ofLaw in Opposition to the Motion to Dismiss (the "Motion" or the "Librarian's Motion") ofRespondent, the Librarian of Congress (the "Librarian"). The Librarian seeks to dismiss AOL's petition, dated August 7, 2002 {the "AOL Petition") for review of the Librarian's order of June 20, 2002, as published in the July 8, 2002 Federal Register, 67 45240 (July 8, 2002) (the "Order" or the "Librarian's Order"). The Librarian contends that AOL lacks standing to seek review because AOL purportedly does not fall within the category of "any aggrieved party bound by the determination" as set forth in 17 U.S.C. $ 802(g). The sole basis for the Librarian's flawed position is that, although a wholly owned subsidiary/division ofAOL, Spinner Networks, Inc. ("Spinner"), was concededly a named party in the underlying administrative proceeding that gave rise to the Order with standing to petition for review, the AOL parent entity named on the petition was not technically a named party. For the reasons set forth below, the Librarian's Motion should be denied. In summary, the Librarian's Motion seeks to dismiss the AOL Petition based on a mere technicality pertaining to which of two parent/subsidiary corporate entities was explicitly named as petitioner. The Motion, however, directly contravenes the rules governing interpretation ofpetitions for review pursuant to Rule 15 of the Federal Rules of Appellate Procedure which provide that such petitions are not to be dismissed based on such mere technicalities. The Librarian's arguments, based on what he claims is the proper interpretation of the phrase "any aggrieved party bound by the determination" in 17 U.S.C. $ 802{g), are simply beside the point when it comes to AOL, because there is no dispute that AOL's wholly owned subsidiary, Spinner, was such a "party" even under the Librarian's interpretation. Accordingly, as discussed further below, the issue of whether AOL, the parent entity of Spinner, or Spinner itself, is named as petitioner, concerns a mere technicality. In the alternative, if the Court determines that it is necessary to name Spinner on the AOL Petition, the Court simply should grant permission to amend the petition accordingly, in keeping with the long-established policy that appeals should be determined based on the merits rather than procedural technicalities. FACTS A. AOL/Spinner Participation In The CARP Proceeding The Librarian's Order pertains to a Copyright Arbitration Royalty Panel proceeding to determine rates and terms for the statutory licenses for the digital performance of sound recordings by eligible non-subscription services, as well as the making of ephemeral recordings by such services, pursuant to 17 U.S.C. ( $ 112(e) and 114 (the "CARP"). As conceded by the Librarian, a Notice of Intent to Participate in the CARP was filed on behalf of AOL, which also listed the website "Spinner.corn" ("Spinner"). Spinner is wholly owned by AOL. See Written Direct Testimony of Fred McIntyre at 1, Librarian's Exhibit B, and Oral Testimony of McIntyre, August 22, 2001, Transcript at 5001, 5002-03 (Librarian's Exhibit C). At the time the notice was filed, Spinner was the only service operated by AOL that was subject to the licensing requirements at issue in the CARP. See Oral Testimony of McIntyre, Transcript at 5009 (Librarian's Exhibit C). Accordingly, AOL/Spinner submitted testimony in the CARP regarding Spinner.'he Spinner written and oral testimony was presented by an executive of AOL, Fred McIntyre, on behalf of Spinner. In oral testimony attached by the Librarian to the Motion, Mr. McIntyre testified that he was appearing on behalf of Spinner as opposed to the Internet service provider ("ISP") aspect of AOL's operations, the record label operations owned by AOL, or any other service of AOL that was not at issue in the CARP. Id. at 5010. At the same time, Mr. McIntyre testified concerning the close relationship between AOL and Spinner. For example, Mr. McIntyre testified that various AOL press releases identified Spinner as an "AOL brand" or part of the "AOL network." See Oral testimony of McIntyre, Transcript at 5122-23, 5138 (attached hereto as Exhibit 2). Mr. 'he Copyright Office dismissed AOL as a separate named party from Spinner because AOL did not file a written direct case separate from Spinner's. Clearly, there was no need for AOL to file separate testimony, as Spinner was the only service operated by McIntyre answered questions concerning AOL's website, which contained a statement that "AOL Music brings together AOL's leading music brands (including Spinner) to reach the largest audience of online music fans in the world." Id. at 5126, 5147-48. Mr. McIntyre further discussed the relationship of Spinner to AOL in the context of "Radio@AOL," an AOL music product that had not yet launched at the time, stating that eventually Radio@AOL would be used to make Spinner content available to traditional AOL users. Id. at 5141-42. He also explained that Spinner had developed Internet radio interfaces for other divisions within the AOL network, including Netscape, ICQ, CompuServe, and AOL Plus. Id. at 5138-39. B. The Librarian's Motion By motion dated September 9, 2002, the Librarian moved to dismiss the petitions of twenty-one petitioners seeking review of the Librarian's Order, including AOL. See Librarian's Motion. With respect to AOL, the Librarian asserted that AOL lacked standing to petition for review because AOL purportedly does not fall within the category of "any aggrieved party bound by the determination" permitted to petition for review pursuant to 17 U.S.C. $ 802(g). Id. at 9, 13. The Librarian argues that, even though AOL owns Spinner (which the Librarian apparently concedes would be a proper petitioner), even though AOL was named on the Notice of Intent to Participate in the CARP along with Spinner, and the even though the Spinner testimony in the CARP was presented by an AOL executive, the Court should nonetheless dismiss the AOL Petition AOL relevant to the subject matter of the CARP. The Librarian conspicuously failed to attach, however, this testimony of Mr. McIntyre, instead attaching a snippet of out-of-context testimony. because, technically, AOL was not a named party in the CARP. Id. at 13. C. AOL's Attempts To Resolve This Motion Amicably In light of the fact that the Librarian's motion is based solely on a technicality as to which of two corporations in a parent/subsidiary relationship was named on the AOL Petition, and in light of the absence of support for the Librarian's motion as to AOL discussed below, counsel for AOL contacted counsel for the Librarian and offered to amend the petition to name Spinner as the petitioner if counsel for the Librarian would agree to withdraw the Motion. Declaration of Kenneth L. Steinthal $ 2, attached hereto as Exhibit 1. Notwithstanding the fact that such an amendment would completely alleviate all of the purported legal concerns addressed by the Librarian's motion, the Librarian's counsel inexplicably refused to agree to the amendment, Id. Counsel for the Librarian's purported justification for this refusal was that petitions for review under Rule 15 are subject to a "bright-line rule" and accordingly the failure to name Spinner explicitly is fatal to the AOL Petition. Id. As discussed below, the Librarian's position is simply incorrect and directly contrary to the applicable law. As a result of the Librarian's refusal, the Court and the parties are being needlessly burdened with the cost and waste of time associated with the Librarian's Motion. ARGUMENT POINT I THE LIBRARIAN'S MOTION SHOULD BE DENIED UNDER THE STANDARDS APPLICABLE TO PETITIONS FOR REVIEW UNDER FRAP RULE 15 The Liberal Pleading Requirements Governing Notices Of Appeal Under FRAP 3 Are Eauallv Applicable To Petitions for Review Under FRAP 15 Petitions for review under 17 U.S.C $ 802(g) are governed by the Federal Rules of Appellate Procedure (and the rules of this Court). FED. R. App. P.15. "Pleading requirements for petitions for review are almost identical to those for appeals Rom orders of district courts." Castillo-Rodriguez v. 1NS, 929 F.2d 181, 184 (5th Cir. 1991) (applying FRAP Rule(3)(c) to a petition for review under Rule 15); see also Interstate Natural Gas Ass'n v. Federal Eneruv Reeulatorv Comm'n, 756 F.2d 166, 170 (D.C. Cir. 1985). Accordingly, petitions for review are permitted a certain degree of informality. See DAVID G. KNIBB, FED. CT. APP. MANUAL $ 17.4 (4th Ed.) (the same informality permitted in a notice of appeal under FRAP Rule 3(c)(4) applies to a petition for review) citing Castillo-Rodriguez. Although Rule 15 states that each petitioner seeking review must be identified on the petition, the purpose of that rule is to require such identification in cases involvine multiple petitioners (which is not the case in the AOL petition here). See FED. R. App. P. 15("The petition must name each party seeking review either in the caption or the body of the petition — using such terms as 'et al.,'petitioners,'r 'respondents'oes not effectively name the parties"); cf.