The US Court Of Appeals has declined to rule on a motion that questioned the constitutional status of the Copyright Royalty Board, the American institution that ultimately rules on copyright issues, mainly royalty rates, in areas where copyright owners are obligated to make their content available on a blanket licence arrangement. The Board's most high profile recent ruling was on internet radio royalties, in which if found in favour of the music industry, setting royalties which most web radio firms said were completely unrealistic.
Royalty Logic, a rights management agency, filed the motion as part of its appeal against the Board's aforementioned web radio royalty rates decision. Royalty Logic are opposed to a side ruling made by the Board in its consideration of the web radio royalties debate - a ruling which said that the US record industry's online collecting society, SoundExchange, should be the exclusive agency for collecting such royalties.
Royalty Logic say that no one organisation should have a monopoly in this domain, and that if private companies like themselves were able to operate in the web royalty space there'd be more competition, which would most likely mean more favourable rates for web radio stations, rather than those proposed by SoundExchange and rubber stamped by the CRB (though, as previously reported, SoundExchange itself last week agreed to lower rates than those set by the Board).
It was in its appeal against CRB's ruling favouring SoundExchange that Royalty Logic decided to question the constitutional status of the CRB itself. In a motion the rights agency argued that CRB judges should be appointed by the President, or the head of a department of the Federal Administration, or at least in a court of law. Because that is not currently the way it works, Royalty Logic said the Board was unconstitutional and its rulings should not, therefore, be binding.
But the Appeals Court refused to rule on the motion, partly, I think, because Royalty Logic didn't file the motion as part of their original appeal but three months later. The court said in a statement: "We need not resolve the dispute. As appellees point out, Royalty Logic has forfeited its argument by failing to raise it in its opening brief".
The US's National Music Publishers Association, while having its own concerns about the CRB, welcomed the Appeals Court's ruling on this matter, telling reporters: "Today's decision is a sigh of relief for the music industry, preventing what would have certainly been chaos in an already tenuous marketplace. While we are hopeful Congress will address any long term concerns regarding the Copyright Royalty Board, songwriters and music publishers are pleased the Board's recent rate decisions will remain as law".