Opposition Brief — Satellite Broadcasting & Communications Ass'n of America v. Ringer

Supreme Court brief1994

Ask Donna

What actually matters in this document.

Text

No. 93-2055

— «

—

Jn the Supreme Court of the Tmtey States

OcTOBER TERM, 1994

SATELLITE BROADCASTING AND COMMU?

ASSOCIATION OF AMERICA, ET Al

MARYBETH PETERS, REGISTER OF COoPyYR

ON PETITION FOR A WRIT O!

TO THE UNITED STATES COUR

FOR THE ELEVENTH CIR

BRIEF FOR THE RESPONDENTS IN OPPOSTEION

QUESTION PRESENTED

Whether the court of appeals correctly deferred to the

ambiguous provision of the Copyright Act of 1976, not-

withstanding a prior decision of the court of appzals,

rendered without the benefit of the agency’s final inter-

pretation, construing the Act differently.

(I)

TABLE OF CONTENTS

Page

ia sacs saan casnceneidavonandaaioscsinas 1

ARREARS 1

Statutory provisions involved ...........ccccccecccessceeessceeececees cee 2

ET rcaciitedi taba cidnanaksabicecadareneasenennsenavaniaoneandcnsasaus 2

IE a 6

REGRESS ERE te 14

SiS EY SES ERS ed la

TABLE OF AUTHORITIES

Cases:

BPS Guard Services, Inc. v. NLRB, 942 F.2d 519 (8th

Ay PES a noe on ee ee a 11

Cablevision Systems Development Co. v. Motion Picture

Ass'n of America, Inc., 836 F.2d 599 (D.C. Cir.), cert.

Gembed, 457 UB. 1206 (19GB) ..0.....1...ccccceccccccosssescccesccoess 7

Chevron U.S.A. Inc. v. Natural Resources Defense Coun-

Dey BPN, BOF CE, GET (IGBE) onncccccscccccccovcnececsncccccccssoasces 4,6, 7

Golden State Transit Corp. v. City of Los Angeles, 493

Neen ca suis 8, 9

Lechmere, Inc. v. NLRB, 112 S. Ct. 841 (1992) ................ 4,5,6

Maislin Indus., U.S., Inc. v. Primary Steel, Inc., 497

a usin cs sac aneuumindcsdvacdeedesadunianaain 6

McDonnell Aircraft Co. v. NLRB, 827 F.2d 324 (8th Cir.

a RREEAT SRST RS Oe ee 11, 12

National Broadcasting Co. v. Satellite Broadcast Net-

works, Inc., 940 F.2d 1467 (11th Cir. 1991) ........... 2 67.8

Saxon v. Georgia Ass’n of Independent Ins. Agents, 399

ee PU EEE MAI, BOND oc chssscknsccerevccnncoconsancacccssanacanans

Schisler v. Sullivan, 3 F.3d 563 (2d Cir. 1998) ................. 11

United States v. Jackson, 968 F.2d 158 (2d Cir.), cert.

Gemied. 113 &. Ct. GEE (1902) .o...........cccccccccocccescsccesessencs 10

(IIT)

Cases—Continued: Page

United States v. Palacio, 4 F.3d 150 (2d Cir. 1993), cert.

pene, AAG Te. Cie RG CD diesettasensttnenecisesiensesnesanes 10, 11

Variable Annuity Life Ins. Co. v. Clarke, 998 F 24 1295

(5th Cir. 1993), cert. granted sub nom. NationsBank of

North Carolina, N.A. v. Variable Annuity Life Ins. Co.,

SG i es See ED dbitcdaisesccnnnansninenintidtdnsiinndadiiapauninininn 9, 10

Statutes and regulation:

Copyrignt Act Of 1976 (17 UBC.) ...ccccorscsscssssosssssccsscsesses 2

a Oe eens IEE caieinay cdehunttonndanbinenasilancaenuopaniinatentennammnains la

EF. Re smeiae BER Kacmaniaiaisanindssabnidenanamisgnaoaned 2, 3, 4, 5, 7, 12, la

Re es he ET Retina Senda pcienandnaesatccnadlenudeiataaaaten 2, 28

Be Ries. Be hina teisiccadsnicincidianetnddeles 2, 4, 5, 7, 8, 12, la-2a

Ee. Re mISAs RU iaccoucesennadchcenbusencnsnirnacnaibnssantadessnsnabeconeniies 13

RE Res et We sicintiicaccsnnciundsadonuiesaanenadaniacsanbintpaidness 13

RG Ried eae dashdsadeeichaheeiibabinaneafacesiammabaiainnindniddaniissanbe 7, 2a

National Bank Act, 12 U.S.C. 21 et seq. .............. cece eeeeeee 9

National Labor Relations Act, 29 U.S.C. 151 et seq. ......... 5

Satellite Home Viewer Act of 1988, Pub. L. No. 100-667,

Tit. II, 102 Stat. 3949:

D BED, BA , FI vesincscccsscnscnnsnccesccssscsnersccsse 13

De, Bee es BIO enicretnncnasernccnssnnes OP BROT ey Ne 13

a ee Ib teetacdlk hachad sche sdcneshanadnnncnavendaienbodnmenmnetnenen 19

Oe Ra a nae PD san ckskcecstsisnkdeddicaincetanonenceanes innate aan 3

Miscellaneous:

139 Cong. Rec. H876 (daily ed. Feb. 24, 1993) ................. 13

140 Cong. Rec. (1994):

p. S5935 (daily ed. May 18, 1994)... eceeeeee 13

p. D764 (daily ed. June 29, 1994) 00... eeeeeeeeeeee 13

Oe i i: Ie CIID acntscccentnncinnsepeantiiensinnnacatecnntnmanns 3

57 Fed. Reg. (1992):

1 ie ait da datatecunsetseptenindeak sudancmdiertanpedisunanlagnmadandets 3

ie MEE sk aakisi can sitatrconssniningadisdeananeniansonaapeapiadeestenionads 4, 12, 13

58 Fed. Reg. (1993)

1M Gahincstsnicscheanddlehnstanated Maaakusanicansaaseasssnnansantinies 13

i MIEN sacialicaliiiesa denise adienedsipieniaeadaciedumienssanaaeenancdniian 13

H.R. 1103, 103d Cong., Ist Sess. (1993) .............ccccsssseeeeees 13

S. 1485, 103d Cong., Ist Sess. (1993) ............csscccsssrrrssees 13

In the Supreme Court of the Giuted States

OCTOBER TERM, 1994

No. 93-2055

SATELLITE BROADCASTING AND COMMUNICATIONS

ASSOCIATION OF AMERICA, ET AL., PETITIONERS

VU.

MARYBETH PETERS, REGISTER OF COPYRIGHTS, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. la-9a) is

reported at 17 F.3d 344. The opinion of the district court

(Pet. App. 10a-16a) is reported at 26 U.S.P.Q.2d (BNA)

1313.

JURISDICTION

The judgment of the court of appeals was entered on

March 24, 1994. The petition for a writ of certiorari was

filed on June 22, 1994. The jurisdiction of this Court is

invoked under 28 U.S.C. 1254(1).

(1)

STATUTORY PROVISIONS INVOLVED

The relevant provisions of the Copyright Act of 1976

are set forth in the appendix to this brief. App., infra, la-

2a.

STATEMENT

1. Under the Copyright Act of 1976, Title 17, United

States Code, a cable system is entitled to retransmit

broadeast signals to customers under a compulsory

license. 17 U.S.C. 111(c)(1). The Act defines a cable

system for this purpose as “a facility, located in any

State, Territory, Trust Territory, or Possession, that in

whole or in part receives signals transmitted or

programs broadcast by one or more television broadcast

stations licensed by the Federal Communications

Commission, and makes secondary transmissions of such

signals or programs by wires, cables, or other

communications channels to subscribing members of the

public who pay for such service.” 17 U.S.C. 111(f).

The Act does not specifically address the question

whether a satellite carrier qualifies as a “cable system”

under Section 111. A satellite carrier retransmits pro-

gramming from broadcast signals via satellite so that

the programming may be viewed in homes that have a

satellite dish and that have paid the satellite carrier the

requisite fee for an unscrambling device. Pet. App. 2a,

10a-lla, 18a. In National Broadcasting Co. v. Satellite

Broadcast Networks, Inc. (SBN), 940 F.2d 1467 (1991)

(reproduced at Pet. App. 17a-25a), the Eleventh Circuit

ruled that a satellite carrier is a “cable system” under

Section 111. The court of appeals rejected the district

court’s view that a cable facility, to qualify as a “facility

located in any State,” 17 U.S.C. 111(f), “must be located

entirely within a single state.” Pet. App. 20a. The court

explained that if Congress had intended the single-state

requirement, it could have drafted the statute more

clearly and concisely. The court also indicated that to

exclude satellite carriers would deprive persons in

sparsely populated regions of high quality television

reception. /d. at 2la-24a.

The court of appeals noted in SBN that the Copyright

Office had issued “a policy decision that satellite

carriers * * * are not ‘cable systems’ under § 111.”

Pet. App. 20a n.4, citing Cable Compulsory License;

Definition of Cable Systems, 56 Fed. Reg. 31,580 (1991).

While acknowledging that the policy decision “fits

within the Agency’s rulemaking authority,” the court of

appeals was not convinced that the rule was meant to

apply retroactively or that the Copyright Office had

authority to issue retroactive rules. Pet. App. 20a n.4.

Moreover, while the court indicated that it found the

views of the Copyright Office on the statutory language

and history “unpersuasive,” the court “express[ed]| no

opinion on the new rule’s validity as applied pros-

pectively.” Jd. at 2la n.4.

2. Subsequently, the Copyright Office promulgated a

final regulation providing that satellite carriers are not

cable systems within the meaning of 17 U.S.C. 111.

Cable Compulsory License; Definition of Cable System,

57 Fed. Reg. 3284 (1992) (rule codified at 37 C.F.R.

201.17(k)).! In its promulgation statement, the Copy-

right Office explained that it rejected the Eleventh

Circuit’s reasoning in SBN because, among other rea-

1 37 C.F.R. 201.17(k) states, in pertinent part: “Satellite

carriers * * * are not eligible for the cable compulsory license

based upon an interpretation of the whole of section 111 of title 17

of the United States Code. At its election, any such entity who

paid copyright royalties into the Copyright Office in an attempt to

comply with 17 U.S.C. 111 may obtain a refund of the royalties.”

sons, “the facilities of a satellite carrier, specifically the

facilities which make the secondary transmission, are

not located in any state, let alone the same state.” 57

Fed. Reg. 3290 (1992). Thus, the Copyright Office con-

cluded (ibid.) that satellite carriers do not satisfy a

“critical requirement” of the definition of “cable

system,” 7.e., that the facilities be “located in any State.”

17 U.S.C. 111(f).

3. Petitioners are satellite carriers and an industry

trade association. They commenced an action in the

United States District Court for the Northern District

of Georgia challenging the validity of the Copyright

Office’s regulation. Pet. App. 10a-12a. The district court

granted summary judgment in favor of petitioners. Jd. at

16a. The court rejected petitioners’ contention that,

under Lechmere, Inc. v. NLRB, 112 S. Ct. 841 (1992), the

conflicted with the prior interpretation of Section 111

rendered by the Eleventh Circuit in SBN. Pet. App. 14a-

15a. The court concluded, however, that it was bound by

SBN’s holding that “a satellite carrier * * * is a cable

system within the meaning of section 111.” Jd. at 16a.

The court explained that it was not free to “reconsider a

question already resolved * * * by its own appellate

court.” Ibid.

4. The court of appeals reversed. Pet. App. la-9a. The

court noted that the Copyright Office is empowered “to

promulgate rules concerning the meaning and appli-

cation of § 111.” Jd. at 5a-6a. Accordingly, the court

applied the principle that the Copyright Office’s rules

are entitled to judicial deference “unless ‘they are

arbitrary, capricious, or manifestly contrary’ to the pro-

visions of the Copyright Act.” Jd. at 6a, quoting

Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837, 844 (1984). The court added

that the principle of deference to permissible agency

interpretations remains applicable even if the agency’s

interpretation contradicts a precedent of the court of

appeals—the situation that existed in Chevron itself.

Pet. App. 6a & n.7.

The court of appeals rejected petitioners’ claim that it

was bound by the Eleventh Circuit’s SBN ruling under

Lechmere, Inc. v. NLRB, supra. In Lechmere, this Court

invalidated an interpretation of the National Labor

Relations Act rendered by the National Labor Relations

Board, because that interpretation contradicted a prior

holding of the Supreme Court articulating the statute’s

“clear meaning” on the relevant issue. Pet. App. 7a,

citing Lechmere, 112 S. Ct. at 847-848. “Unlike the

statutory scheme in Lechmere,” the court of appeals

explained, Section 111(f) “is far from explicit as to the

inclusion of satellite carriers.” Pet. App. 7a. The

decision in SBN had not expounded the statute’s “clear

meaning,” but had drawn on “inferences * * * from the

statutory scheme and upon our policy determination that

satellite carriers should be included for the benefit of

their rural customers.” Jd. at 7a-8a. The court also

noted that SBN had explicitly left open the prospective

validity of the Copyright Office’s interpretation of

Section 111. Pet. App. 8a, citing SBN, Pet. App. 21a n.4.

In light of those factors, the court of appeals held that

it was not precluded from judging the Copyright Office’s

rule against Chevron standards rather than against

SBN’s holding. Pet. App. 8a. “A contrary result,” the

court explained, “illogically would wed this circuit to the

SBN decision, while all other circuits and the Supreme

Court would be bound under Chevron to defer to the

Turning to the underlying merits of the dispute, the

court of appeals determined that the Copyright Office’s

interpretation of the statute was a permissible one and

therefore valid under Chevron. Pet. App. 8a-9a. The

court observed that not only was the interpretation

consistent with “Congress’s ‘clear meaning,’” but

“virtually nothing in the section’s legislative history

suggests that Congress even contemplated the entrance

of satellite technology into the cable industry.” Jd. at 9a.

ARGUMENT

1. Petitioners contend (Pet. 9-13) that the court of

appeals erred by applying principles of deference in

reviewing the Copyright Office’s rule, rather than

giving stare decisis effect to the court’s prior holding in

SBN. According to petitioners (Pet. 12), the court of

appeals’ analysis conflicts with Lechmere, Inc. v. NLRB,

in which this Court stated that “[o]nce we have

determined a statute’s clear meaning, we adhere to that

determination under the doctrine of stare decisis, and we

judge an agency’s later interpretation of the statute

against our prior determination of the statute’s

meaning.” 112 8. Ct. at 847-848, quoting Maislin Indus.,

U.S., Inc. v. Primwry Steel, Inc., 497 U.S. 116, 131 (1990).

There is no merit to petitioners’ contention.

In Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., this Court made clear that in reviewing an

agency’s interpretation of a federal statute entrusted to

its administration, the validity of the interpretation

turns on two inquiries. The first inquiry is whether

Congress itself has expressed an intention on the

relevant issue. If Congress has manifested its intent,

both the courts and the agency are bound by that

statutory meaning.” The second inquiry arises if

2 “First, always, is the question of whether Congress has

directly spoken to the precise question at issue. If the intent of

Congress has failed to express an intent on the specific

issue or if the statute is ambiguous. In that setting, a

court does not substitute its own interpretations for

those of the agency authorized to administer the statute,

but is required to give deference to the agency’s

interpretations “unless they are arbitrary, capricious,

or manifestly contrary to the statute.” 467 U.S. at 844.

The court of appeals correctly applied Chevron by

giving deference to the agency’s interpretation here.

The court found that Congress had not expressed an

intention on the precise issue of whether a satellite

carrier is a “cable system” under Section 111(f) of the

permissible construction of the statute by the Copyright

Office, which has authority to promulgate rules

interpreting the Act. See 17 U.S.C. 702; Cablevision

Systems Development Co. v. Motion Picture Ass’n of

America, inc., 836 F.2d 599, 608-609 (D.C. Cir.), cert.

denied, 487 U.S. 1235 (1988).

Contrary to petitioners’ claim, Lechmere did not

require the court to apply stare decisis and invoke its

prior interpretation of Section 111 in SBN to find the

citly stated that the court was leaving open the validity

of the Copyright Office’s rule. Pet. App. 20a n.4.

Because the SBN court did not purport to determine the

rule’s validity, its holding did not have any stare decisis

Congress is clear, that is the end of the matter; for the court, as

well as the agency, must give effect to the unambiguously

expressed intent of Congress.” Chevron, 467 U.S. at 842-843.

3 The statute applies to “a facility, located in any State,

Territory, Trust Territory, or Possession.” 17 U.S.C. 111(f). The

text of the statute does not have an unambiguous meaning as

applied to a satellite facility orbiting 22,000 miles above any State.

effect on that issue. Thus, SBN did not preclude the

court of appeals from later reviewing the Copyright

Office’s rule under Chevron when the rule’s validity was

squarely presented. SBN itself noted that if it had been

reviewing the Copyright Office’s rule as applied

retroactively, the interpretation “might be entitled to

deferential review under Chevron.” Pet. App. 20a n.4.

Second, SBN did not articulate the “clear meaning” of

Section 111(f) under the first step of Chevron. In

contrast to this Court’s conclusion in Lechmere that a

prior decision of the Court had resolved the statute’s

clear meaning, the SBN decision relied “upon inferences

drawn from the statutory scheme and upon [the court’s]

policy determination that satellite carriers should be

included for the benefit of their rural customers.” Pet.

App. 7a-8a. The SBN court thus resolved an issue of

interpretation on which Congress had not expressed a

clear intention. Nothing in Lechmere suggests that a

court should give stare decisis effect to its own elucida-

tion of an ambiguous provision once the agency vested by

Congress with responsibility for administering the

statute has expressed a contrary view.

Relying on Golden State Transit Corp. v. City of Los

Angeles, 493 U.S. 103, 112 (1989), petitioners argue (Pet.

12 n.8) that SBN deserved stare decisis effect even if the

court were imposing its own construction on an

ambiguous provision. In Golden State, the Court stated

that “[a] rule of law that is the product of judicial

interpretation of a vague, ambiguous, or incomplete

statutory provision is no less binding than a rule that is

based on the plain meaning of a statute.” 493 U.S. at 112.

That case, however, did not address any question of

judicial review of an agency interpretation. Rather, the

federal government had “no authority” to address the

statutory construction issue involved in Golde» State

Transit. Id. at 108.

If petitioners’ view of stare decisis were accepted, it

would lead to absurd results. As the court of appeals

noted, Pet. App. 8a, petitioners’ view would compel one

regional court of appeals to adhere to its prior decision

and find the rule invalid, while every other court of

appeals—and this Court—would be bound to give the rule

Chevron deference. It would make little sense for a

court of appeals to decline to review the rule under

Chevron, with the effect that this Court would more

often have to intervene to resolve conflicts and review

the rule under the proper standard of deference. More-

over, petitioners’ approach would encourage parties to

seek a judicial construction of a statute before an agency

has a chance to interpret it through rulemaking. Pet.

App. 8a. Giving precedence to the view of the court

rather than the agency in such a setting would conflict

with Congress’s judgment to vest administrative

responsibility in expert agencies and with the Chevron

framework that this Court established to implement that

judgment.

2. Petitioners err in contending (Pet. 13-14) that the

decision in this case conflicts with decisions of other

courts of appeals. In Variable Annuity Life Ins. Co. v.

Clarke, 998 F.2d 1295, 1299-1300 (5th Cir. 1993), cert.

granted sub nom. NationsBank of North Carolina, N.A.

v. Variable Annuity Life Ins. Co., 114 S. Ct. 2161 (1994)

(No. 93-1612), the court of appeals struck down an agency

rule in reliance on Saxon vy. Georgia Ass'n of

Independent Ins. Agents, 399 F.2d 1010 (5th Cir. 1968),

believing that that case had found certain sales of

annuities to be prohibited by the “plain language” of the

National Bank Act. 998 F.2d at 1299. The Fifth Circuit

explained that judicial deference to an agency’s

interpretation “is not appropriate under Chevron if the

intent of Congress is clear.” bid. That statement does

not conflict with the court of appeals’ decision to give

deference to the Copyright Office’s interpretation where

the intent of Congress was not clear.’

Similarly distinguishable is United States v. Palacio,

4 F.3d 150 (2d Cir. 1993), cert. denied, 114 S. Ct. 1194

(1994). There, despite contrary views expressed by the

Sentencing Commission, the court of appeals followed its

prior decision in United States v. Jackson, 968 F.2d 158

(2d Cir.), cert. denied, 113 S. Ct. 664 (1992), which had

interpreted the meaning of cocaine base under 21 U.S.C.

841(b). 4 F.3d at 154-155. Palacio does not conflict with

the decision below for two reasons. First, the prior

decision in Jackson purported to apply Congress’s intent

on the precise issue before the court. See 968 F.2d at 163

(“Expert testimony in this case established that there is

a clear definition of ‘cocaine base’ undisputed in the

scientific community. It is that meaning that Congress

intended section 841(b) to have.”). SBN, in contrast,

constituted an interpretation of the statute on an issue

that Congress had not considered or addressed. Second,

unlike regulatory agencies that adopt implementing

rules for statutes they administer—such as the

mission’s function is to promulgate sentencing guide-

4 In our view, the Fifth Circuit erred in holding that the plain

language of the National Bank Act bars the disputed annuity sales.

Our petition in Variable Annuity Life Ins. Co., however, raises no

question about the stare decisis effect of the Saxon decision. Thus,

contrary to petitioners’ suggestion (Pet. 13 n.9), there is no reason

to hold the petition in this case pending the decision in Variable

Annuity Life Ins. Co.

lines, not to construe or administer the provisions of

federal criminal statutes. Palacio, 4 F.3d at 155.

Any suggestion that the Second Circuit would follow a

different rule than the court applied in this case is laid to

rest by Schisler v. Sullivan, 3 F.3d 563 (2d Cir. 1993). In

Schisler, the court held that it was not bound by its

earlier interpretation of an ambiguous federal statute

when reviewing the agency’s subsequent interpretation.

The court explained (id. at 568):

New regulations at variance with prior judicial

precedents are upheld unless “they exceeded the

Secretary’s authority [or] are arbitrary and

capricious.” [Heckler v.] Campbell, 461 U.S. [458] at

466, 466-68 [(1983)]; [Bowen v.] Yuckert, 482 U.S.

[187] at 144-54 [(1987)] (upholding Secretary’s

“severity” regulation as valid under the Act; rejected

court’s prior rule); Chevron U.S.A., Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837, 841-45

(1984) (upholding EPA regulation’s construction of a

statutory term despite conflicts between it and

court’s precedents); Grocery Mfrs. of America, Inc.

v. Gerace, 755 F.2d 993, 1001 (2d Cir.), aff’d, 474 U.S.

801, cert. denied, 474 U.S. 820 (1985).

Finally, BPS Guard Services, Inc. v. NLRB, 942 F.2d

519 (8th Cir. 1991), held that McDonnell Aircraft Co. v.

NLRB, 827 F.2d 324 (8th Cir. 1987) (McDonnell II),

required that court to reject an interpretation of the

labor laws by the National Labor Relations Board. The

issues in McDonnell II and BPS Guard Services were

identical: whether the National Labor Relations Board

had reasonably determined that fire fighters were not

“guards” within the meaning of Section 9(b)(3) of the

National Labor Relations Act, 29 U.S.C. 159(b)(3). 942

F.2d at 523-524. The Eighth Circuit ruled (id. at 524)

that it would adhere to its prior construction of the

statute in McDonnell II, 827 F.2d at 330, which had held

the agency’s interpretation to be invalid under the

statute. The court of appeals in this case did not

confront that situation. Here, the court’s prior con-

struction of the Copyright Act in SBN did not purport to

review (let alone invalidate) the agency interpretation

that was before the court in this case.

3. Finally, there are two additional reasons that

undercut petitioners’ request for this Court’s review.

First, the court of appeals was correct in upholding,

under Chevron, the Copyright Office’s view that

satellite carriers are not “cable systems” under Section

111. Petitioners have not requested the Court to review

that holding (see Pet. (i)), and it is an independent

justification for the judgment below. Quite apart from

whether the Eleventh Circuit should have considered

itself bound by stare decisis to reject the Copyright

Office’s rule, this Court would not be bound by any lower

court precedent on that issue. And, under a proper appli-

cation of Chevron, the Copyright Office’s interpretation

is plainly reasonable and entitled to deference.”

> The Copyright Office explained that, to be a cable system, a

“facility” must be “located in any State,” “receive[]” signals of

FCC-licensed stations, and “make[] secondary transmissions.” 57

Fed. Reg. 8290 (1992), citing 17 U.S.C. 111(f). A satellite carrier’s

facility is “not located in any state,” but rather makes secondary

transmissions “from geostationary orbit above the earth.” Jbid. In

addition, for purposes of determining royalties, Section 111(f)

instructs that “two or more cable systems in contiguous

communities under common ownership or control or operating

from one headend shall be considered as one system.” 17 U.S.C.

111(f). Because satellite carriers have no “headends”, they lack

the physical properties that Congress assumed would be present in

establishing a royalty scheme for “cable system[s].” 57 Fed. Reg.

3290 (1992). Finally, for a variety of reasons, the compulsory

Second, Congress is currently considering legislation

that would address the underlying dispute in this case.*

In the Satellite Home Viewer Act of 1988, Congress

expressly created a compulsory license for satellite

rebroadcast facilities. Pub. L. No. 100-667, Tit. II,

§ 202(2), 102 Stat. 3949-3958, codified at 17 U.S.C. 119.

That temporary compulsory license provision will expire

on December 31, 1994. Pub. L. No. 100-667, Tit. II, § 207,

102 Stat. 3960, 17 U.S.C. 119 note. The Senate, however.

has passed a bill that would extend that sunset date until

December 31, 1999, and make satellite carriers eligible

for compulsory licensing under certain circumstances.

S. 1485, 103d Cong., Ist Sess. (1993); see 140 Cong. Ree.

55935 (daily ed. May 18, 1994). The House is currently

considering similar legislation. H.R. 1103, 103d Cong.,

Ist Sess. (1993); see 139 Cong. Rec. H876 (daily ed. Feb.

24, 1993) (bill introduced and referred to Committee on

the Judiciary); 140 Cong. Rec. D764 (daily ed. June 29,

1994) (bill reported by Committee on the Judiciary as

amended). Congress’s active consideration of the issue

counsels against this Court’s review of the decision in

this case.

license regime for cable systems was “clearly directed at localized

transmission services” (ibi4.), not at satellite facilities in

geostationary orbit 22,000 miles above the earth.

6 For that reason, the Copyright Office has delayed the original

January 1, 1994, effective date of the rule at issue in this case. See

58 Fed. Reg. 40,363 (1993) (“{T]he legislative climate is bright for

satisfying the copyright needs of satellite carriers, MDS, MMDS

and other providers with respect to retransmission of broadcast

programming. In order to foster the opportunity for congressional

action, the Copyright Office is extending the effective date of its

cable definition regulation, § 201.17(k), to January 1, 1995.”); see

also 58 Fed. Reg. 45,263 (1993).

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

DREW S. DAYS, III

Solicitor General

FRANK W. HUNGER

Assistant Attorney General

WILLIAM KANTER

BRUCE G. FORREST

Attorneys

AUGUST 1994

APPENDIX

The Copyright Act, Title 17, United States Code,

provides, as pertinent here:

§ 102. Subject matter of copyright: In

general

(a) Copyright protection subsists, in accordance

with this title, in original! works of authorship

fixed in any tangible medium of expression, now

known or later developed, from which they can be

perceived, reproduced, or otherwise communi-

cated, either directly or with the aid of a machine

or device. * * *

§ 111. Limitations on exclusive rights:

Secondary transmissions

Systems.—

(1) * * * |SJecondary transmissions to

the public by a cable system of a primary

transmission made by a broadcast station

* * * shall be subject to compulsory

licensing * * *,

(f) Definitions.—As used in this section, the

following terms and their variant forms mean the

following:

(la)

A “eable system” is a facility, located in any

State, Territory, Trust Territory, or Possession,

that in whole or in part receives signals

transmitted or programs broadcast by one or

more television broadcast stations licensed by the

Federal Communications Commission, and makes

secondary transmissions of such signals or

programs by wires, cables, or other communi-

cations channels to subscribing members of the

public who pay for such service. For purposes of

determining the royalty fee under subsection

(d)(1), two or more cable systems in contiguous

communities under common ownership or control

or operating from one headend shall be considered

as one system.

§ 702. Copyright Office regulations

The Register of Copyrights is authorized te

establish regulations not inconsistent with law

for the administration of the functions and duties

made the responsibility of the Register under this

title. All regulations established by the Register

under this title are subject to the approval of the

Librarian of Congress.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.