Federal Register / Vol. 71, No. 211 / Wednesday, November 1, 2006 / Notices 64303 [FR Doc. E6–18352 Filed 10–31–06; 8:45 am] (‘‘RIAA’’) requested that the Board refer the Register of Copyrights (‘‘Register’’). BILLING CODE 4510–30–P a question to the Register of Copyrights Specifically, the Board requested a regarding the eligibility of ringtones decision by the Register as to the (i.e., short digital sound recording file following: LIBRARY OF CONGRESS distributed for use in a cellular telephone or similar device) for 1. Does a ringtone, made available for Copyright Office statutory licensing under Section115 of use on a cellular telephone or similar the Copyright Act. An opposition to the device, constitute delivery of a digital [Docket No. RF 2006–1] phonorecord that is subject to statutory RIAA‘s referral motion was submitted, licensing under 17 U.S.C. § 115, Mechanical and Digital Phonorecord collectively, by the National Music irrespective of whether the ringtone is Delivery Rate Adjustment Proceeding Publishers Association, Inc., the monophonic (having only a single Songwriters Guild of America, and the melodic line), polyphonic (having both AGENCY: Copyright Office, Library of Nashville Songwriters Association melody and harmony), or a mastertone (a Congress. International (‘‘Copyright Owners’’). digital sound recording or excerpt ACTION: Final Order. After considering the arguments of the thereof)? parties, the Board agreed that the SUMMARY: The Copyright Royalty Board, matters raised by the RIAA motion did 2. If so, what are the legal conditions acting pursuant to statute, referred two and/or limitations on such statutory present novel questions of law and licensing?2 novel questions of law to the Register of agreed to submit the questions to the Copyrights. Specifically, the Copyright Register. Accordingly, on September 14, Royalty Board requested a decision by In sum, and as stated more fully 2006, the Board transmitted to the below, we believe that ringtones the Register of Copyrights regarding Register: (1) an Order, dated August 18, whether ringtones are subject to the (including monophonic and polyphonic 2006, referring two novel questions of ringtones, as well as mastertones) statutory license for making and law; and (2) the Initial and Reply Briefs distributing phonorecords under the qualify as digital phonorecord deliveries filed with the Board by RIAA and the (‘‘DPDs’’) as defined in 17 U.S.C. § 15. Copyright Act, and if so, what legal Copyright Owners. The Board‘s conditions and/or limitations would Apart from meeting the formal transmittal triggered the 30–day requirements of Section 115 (e.g., apply. The Register of Copyrights, in a decision period prescribed in Section timely fashion, transmitted a service of a notice of intention to obtain 802 of the Copyright Act. This statutory a compulsory license under Section Memorandum Opinion to the Copyright provision states that the Register ‘‘shall Royalty Board stating, with certain 115(b)(1), submission of statements of transmit his or her decision to the account and royalty payments, etc.), caveats, that the statutory license Copyright Royalty Judges within 30 applies to ringtones. whether a particular ringtone falls days after the Register of Copyrights within the scope of the statutory license DATES: Effective Date: October 16, 2006. receives all of the briefs or comments of will depend primarily upon whether FOR FURTHER INFORMATION CONTACT: Ben the participants.’’ See17 U.S.C. what is performed is simply the original Golant, Senior Attorney, and Tanya M. 802(f)(1)(B)(i). On October 16, 2006, the musical work (or a portion thereof), or Sandros, Associate General Counsel, Register transmitted a Memorandum a derivative work (i.e., a musical work Copyright GC/I&R, P.O. Box 70400, Opinion to the Board that answered the based on the original musical work but Southwest Station, Washington, DC novel questions of law. To provide the which is recast, transformed, or adapted 20024. Telephone: (202) 707–8380. public with notice of the decision in such a way that it becomes an Telefax: (202) 707–8366. rendered by the Register, the original work of authorship and would SUPPLEMENTARY INFORMATION: In the Memorandum Opinion is reproduced in be entitled to copyright protection as a Copyright Royalty and Distribution its entirety, below. derivative work). Reform Act of 2004, Congress amended Dated: October 26, 2006 Procedural Background. On August 1, Title 17 to replace the copyright Marybeth Peters, 2006, the RIAA requested that the arbitration royalty panel with the Register of Copyrights. Copyright Royalty Board refer a Copyright Royalty Board (‘‘Board’’). One question to the Register of Copyrights of the functions of the new Board is to Before the regarding the eligibility of a mastertone, make determinations and adjustments of U.S. Copyright Office a short digital sound recording file reasonable terms and rates of royalty Library of Congress distributed for use in a cellular payments as provided in sections Washington, D.C. 20559 telephone or similar device, for 112(e), 114, 115, 116, 118, 119 and 1004 statutory licensing under 17 U.S.C. Docket No. RF 2006–1 of the Copyright Act. In any case in 3 In the Matter of § 115. An opposition to the RIAA‘s which a novel question of law Mechanical and Digital Phonorecord concerning an interpretation of a Delivery Rate Adjustment Proceeding determinations, and rulings described in Section provision of the Copyright Act is 803(a) of the Copyright Act. See 17 U.S.C. presented in a ratesetting proceeding, § 802(f)(1)(B)(ii). MEMORANDUM OPINION 2 See Mechanical and Digital Phonorecord the Board has the authority to request a Delivery Rate Adjustment Proceeding, Order decision of the Register of Copyrights I. Introduction Granting in Part the Request for Referral of a Novel (‘‘Register’’), in writing, to resolve such On September 14, 2006, the Copyright Question of Law, Docket No. 2006–3 CRB DPRA questions. See 17 U.S.C. 802(f)(1)(B)(i). (Aug. 18, 2006) (‘‘Order’’). Royalty Board (‘‘Board’’), acting on a 3 The Copyright Royalty Board is currently For this purpose, a ‘‘novel question of request by the Recording Industry conducting a proceeding to determine the law’’ is a question of law that has not Association of America, Inc. (‘‘RIAA’’), reasonable rates and terms for the making and been determined in prior decisions, and pursuant to 17 U.S.C. § 802(f)(1)(B), distribution of phonorecords under the Section 115 determinations, and rulings described in 1 license. See Adjustments or Determination of referred two novel questions of law to Compulsory License Rates for Making and Section 803(a) of the Copyright Act. Distributing Phonorecords, 71 Fed Reg 1454 (Jan. 9, On August 1, 2006, the Recording 1 A ‘‘novel question of law’’ is a question of law 2006). The answers to the two questions referred to Industry Association of America that has not been determined in prior decisions, Continued VerDate Aug<31>2005 20:45 Oct 31, 2006 Jkt 211001 PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 E:\FR\FM\01NON1.SGM 01NON1 sroberts on PROD1PC70 with NOTICES 64304 Federal Register / Vol. 71, No. 211 / Wednesday, November 1, 2006 / Notices referral motion was submitted, derivative works, RIAA argues that Moreover, we decide that a ringtone is collectively, by the National Music Section 115(a)(2), the arrangement made and distributed for private use Publishers Association, Inc., the privilege, expressly authorizes their even though some consumers may Songwriters Guild of America, and the creation. In any event, RIAA argues that purchase them for the purpose of Nashville Songwriters Association once the copyright owner of a musical identifying themselves in public. We International (‘‘Copyright Owners’’). work distributes a new ringtone to the also conclude that if a newly created After considering the arguments of the public, anyone can obtain a statutory ringtone is considered a derivative parties, the Board agreed that the license to use the musical work in that work, and the work has been first matters raised by the RIAA motion did ringtone. RIAA concludes that the distributed with the authorization of the present novel questions of law and Register should find that ringtones are copyright owner, then any person may agreed to submit the questions to the subject to statutory licensing under use the statutory license to make and Register. Section 115 of the Copyright Act, and distribute the musical work in the Accordingly, on September 14, 2006, all of the conditions under the provision ringtone. For those ringtones that are the Board transmitted to the Register of should apply. covered by Section 115 of the Copyright Copyrights the following: (1) the Order, Copyright Owners assert that all Act, all of the rights, conditions, and dated August 18, 2006, referring two ringtones are excluded from the Section requirements in the Act would apply. novel questions of law; and (2) the 115 statutory license. They argue that For those ringtones that fall outside the Initial and Reply Briefs filed with the the statutory license for making and scope of Section 115, the rights at issue Board by RIAA and the Copyright distributing phonorecords of musical must be acquired through voluntary Owners. The Board‘s transmittal works is narrow in scope and does not licenses. While the Copyright Royalty triggered the 30–day decision period encompass ringtones. They argue that Judges need not know which specific prescribed in Section 802(f)(1)(B) of the ringtones are not covered by Section 115 ringtones fall within/outside the scope Copyright Act. This statutory provision because they involve only a portion of of the license for the purpose of setting states that the Register of Copyrights the underlying composition, not the rates, and the parties have not asked the ‘‘shall transmit his or her decision to the entire musical work.