BEFORE THE COPYRIGHT ROYALTY TRIBUNAL WASHINGTON, D.C. In the &latter of 1989 CABLE ROYALTY DOCKET NO. CRT 91-2-89CD DISTRIBUTION PROCEEDING (This volume contains pages 525 through 691) washington, D.C. Thuursday, September 19, 1991 The above-entitled matter was reconvened, pursuant to adjournment, in. the Offices of the Copyright Royalty Tribunal, in Room 921, 1825 Connecticut Avenue, N.H., Uashington, D.C., at 9:30 a.m. BEFORE NARIO F. AGUERO Chairman J.C. ARGETSINGER Commissioner CINDY DAUB Commissioner ROBERT CASSLER General Counsel NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 526 APPEARANCES: PROGRAM SUPPLIERS: On behalf of MPAA: ARTHUR SCHEINER„ ESQUIRE DENNIS LANE, ESQUIRE Holland & Knight 888 17th Street, N.'tl., Suite 900 '|washington, D.C. 20006 (2O2) 955-555O 1|USIC CLAIlJANTS: On behalf of ASCAP: I. FRED KOENIGSBERG, ESQUIRE White R Case 1155 Avenue of the Americas Ne~z York, Ne~a York 10036-2787 (212) 819-8200 BERNARD KORIIAN, ESQUIRE BENNETT H. LINCOFF, ESOUIRE ASCAP One Lincoln Plaza New York, New York 10023 (212) 621-6270 On behalf of BNI: CHARLES T. DUNCAN, ESQUIRE MICHAEL FABER, ESQUIRE JOSEPH J. DiHONA, ESOUIRE Reid E Priest Market Sc(uare 701 Pennsylvania Avenue, N.N. Washington, D.C. 20004 (202) 508-4081 EDWARD H. CHAPIN, ESOUIRE General Counsel Broadcast Music, Inc. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 527 APPEARANCES: (Continued) On behalf of SESAC: LAURIE HUGHES, ESOUIRE SESAC, Inc. 55 Music Square East Nashville, Tennessee 37203 (615) 320-0055 On behalf of National Association of Broadcasters: JOHN I. STEWART, JR., ESQUIRE WILLIAM D. WALLACE, ESQUIRE LORI U. BATTISTONI, ESQUIRE Cromwell (('oring 1001 Pennsylvania Avenue, N.W. Washington, D.C. 20004-2505 (202) 624-2500 On behalf of Joint. Soorts Claimants: ROBERT A. GARRETT, ESOUIRE TERRI SOUTHWICK, ESQUIRE Arnold R Porter 1200 New Hampshire Avenue, N.W. Washington, D.C. 20036 (202) 872-6700 PHILIP R. HOCHBERG, ESQUIRE Baraff, Koerner, Olender & Hochberg 5335 Wisconsin Avenue, N.W., Suite 300 Washington, D.C. 20015-2003 (202) 686-3200 On behalf of Public Television Claimants: THOMAS P. OLSON, ESOUIRE Randolph D. Moss, Esquire Wilmer, Cutler R Pickering 2445 M Street, N.W. Washington, D.C. 20037-1420 (202)663-6651 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 528 APPEARANCES: (Continued) On behalf of Devotional Claimants: JOHN H. MIDLEN, JR., ESOUIRE GREGORY H. GUILLOT, ESOUIRE Midlen R Guillot, Chartered 3238 Prospect Street, N.W. Washington, D.C. 20007-3214 (202) 333-1500 CLIFFORD HARRINGTON, ESOUIRE BARRY H. GOTTFRIED, ESOUIRE Fisher, Wayland, Cooper Ec Leader 1255 23rd Street, N.W., Suite 800 GEORGE R. GRANGE, Il, ESOUIRE RICHARD M. CAMPANELLI, ESQUIRE Gammon R Grange 1925 K Street, N.W., Suite 300 Washington, D.C. 20006 {202) 862-2000 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 2344433 COMTEMT8 EZAHIMATXOM SITMESSES DIR CROSS REDIR RECROSS TRIB'L Program Suppliers Allen R. Cooper By Mr. Garrett (Res) -- 535 By Mr. Koenigsberg -- 573 By Nr. Stewart 581 EZHI B ITS FOR MUMBER IDEMTIFICATXOM RECEIVED JOIMT SPORTS 16-Z 18-Z 535 535 20-Z 535 21-Z 22-Z 562 23-Z 567 Music NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 2344433 WASHINGTON, D.C. 20005 (202) 2344433 530 C 0 H T E I T 3 (Continued) E Z H I B I T 8 (Continued) FOR iAJiABER IDEHTIFICATIOi4 RECEIVI93 NAB 588 606 632 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 PROCEED INGS (9:00 a.m.) CHAIRMAN AGUERO: Let's go on the record. We 4 will continue this morning with the 2989 Cable Royalty 5 Distribution. Before we proceed with MPAA and Sports 6 Claimants, we want to welcome Mr. Duncan -- welcome to the 7 Tribunal. We miss you a lot, of course, as always. Before we continue, do we have any comment on the 9 situation in Tampa, Florida? Any comments, or no comments 10 at all? Mx . Garrett? Mx . Lane? MR. GARRETT: Mr. Chairman, I xeceived a copy of 12 a letter from Nielsen to Allen Cooper the day before 13 yestexday, stating that they reaffirm their position that 14 they will not allow us to make copies of any of the 15 diaries CHAIRMAN AGUERO: You mean photocopies? MR. GARRETT: That's correct, Mr. Chairman, and 18 I had planned to talk to Mr. Scheiner about that further 19 at the lunch recess today, to see whether there is anything 20 else that can be worked out. The letter, again, does not state any reason why 22 photocopying will not be allowed, other than that is their 23 practice. And unless I can understand what the basis for 24 no photocopying is, it's difficult to structure any type 25 of an arrangement that could protect whatever legitimate NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 2344433 532 1 interest may have in the situation. COMMISSIONER ARGETSINGER: Mr. Garret t, I read 3 the letter also. Does this preclude hand-copying? MR. SCHEINER: It does not. COMMISSIONER ARGETSINGER: It does not. MR. GARRETT: No. But that procedure is not 7 acceptable to us, Commissioner Argetsinger, anymore than 8 it was acceptable to PBS in connection with our surveys. CHAIRMAN AGUERO: Do you have any idea, Mr. 10 Garrett, if you photocopy what you want to copy, how many 11 hours you would need against hand-writing copies'? 12 MR. GARRETT: It will clearly be sufficiently 13 more time-consuming for people to make handwritten notes 14 than it would be to photocopy it. Me would also lose the 15 advantage, of course, of being able to take the diaries 16 back for further analysis here. Handwritten notes may not 17 be complete. Other issues may arise when we go back to 18 review the handwritten notes, that weren't considered while 19 you'e sitting there in a warehouse reviewing these 20 diaries. There are additional difficulties in presenting 21 evidence based upon handwritten notes to this Tribunal, 22 presenting evidence in an effective manner. The situation 23 of presenting such evidence on the basis of handmritten 24 notes, of course, is unprecedented here in the Tribunal 25 and, generally, in the federal court system as well. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 2344433 533 Those are some of the concerns that I have with 2 the procedure outlined and, as 1 stated at the outset, I 3 still am unaware of what the interests of Nielsen, in 4 precluding us from making those copies, may be. And until 5 I know that, it's difficult to work out some type of an 6 arrangement that is mutually satisfactory to all parties, 7 as we have already done with our questionnaires. CHAIRMAN AGUERO: Do you think it, is a very good 9 idea to send to Tampa, Florida, Nr. Larson again, in the 10 way Mr. Larson is going to perform the analysis for the 11 Joint Sports Claimants, send Mr. Larson to Tampa, Florida 12 with one NPAA representative and one Joint Sports Claimant 13 representative'? What do you think'? MR. GARRETT: Well, Nr. Chairman, I don't believe 15 that Nr. Larson, at least not by himself, could perform the 16 type of analyses that. we would like to have done with the 17 diaries down there. As I also indicated a couple of days ago when 19 this issue arose, I am also very concerned about any 20 procedure that would require or permit a representative of 21 MPAA to effectively be standing over the shoulders of our 22 experts, watching what it, is that they are reviewing and 23 how we are preparing for cross-examination. Our arrangement. with respect to our surveys 25 provides for us giving the materials over to Mr. Larson NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 2344433 WASHINGTON, D.C. 20005 (202) 2344433 1 directly, and Mr. Larson then runs whatever analyses the 2 particular claimants ask him to run. And it is part of our 3 agreement that Mr. Larson does not inform any other party 4 of the nature of the runs he is making„ or what xequests 5 were made of him. It is obviously very important to other 6 parties to keep those types of requests confidential in 7 dealing with our surveys, and we, of course, feel the same 8 with respect to the diaries. CHAIRMAN AGUERO: Well, the Tribunal hopes and 10 expects that in the lunch break you may come forward with 11 a solution. If not, the Commission will make some decision 12 in the neax future. MR. GARRETT: I would, like at least one last 14 opportunity to discuss this with Mr. Scheiner and, if that 15 does not provide a successful resolution, Mx. Chairman, I 16 would. appxeciate the opportunity to file a written motion 17 dixected to the situation, asking for an appropriate 18 relief. CHAIRMAN AGUERO: Very good. 20 Whereupon, ALLEN R. COOPER 22 resumed the witness stand and, having previously been duly 23 sworn, was examined and testified further as follows: CHAIRMAN AGUERO: Well, Mr.