From unconstitutional to constitutional in a couple of pages, the Copyright Royalty Board has dodged a bullet, thanks to the D.C. Circuit.
The U.S. Court of Appeals for the D.C. Circuit has concluded that the structure of the Copyright Royalty Board (CRB) violates the Appointments Clause of the Constitution. As a result, a CRB rate determination under appeal has been vacated and the matter remanded to the CRB for further consideration.
But wait, you say – why remand it to the CRB if the CRB is unconstitutional? In a deft demonstration of judicial legerdemain, the court also concluded that CRB’s unconstitutionality could be remedied if the court were simply to write some inconvenient language out of the governing CRB statute – and that’s just what the court did. So while the CRB may not have been constitutional before the court’s decision, it will be constitutional as of that decision, as will CRB determinations made after the court’s decision.
The case involves a challenge to the CRB’s 2011 decision setting copyright royalty rates for certain noncommercial webcasters. Intercollegiate Broadcasting System, Inc. (Intercollegiate), an association of noncom webcasters unhappy about the decision, appealed.
Intercollegiate raised a number of arguments, but the one that obviously got the court’s attention was the Appointments Clause claim. The Appointments Clause? Maybe not as familiar to the Great Unwashed as, say, the Commerce Clause or the First Amendment, it’s still a f’real part of the Constitution – check for yourself at Article II, Section 2, Clause 2. For those of you who never bothered to memorize the Appointments Clause for your Civics Class, here ‘tis:
[The President] . . . shall nominate, and by and with the Advice and Consent of the Senate, shall appoint . . . Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.
Intercollegiate argued that the CRB’s members are “principal” rather than “inferior” officers and, as such, must be appointed by the President and confirmed by the Senate. Since CRB members aren’t appointed by the Prez (or confirmed by the Senate), they’re constitutionally invalid, as are their decisions.
This argument is not new. It surfaced three years ago in a CRB appeal. In that case the argument wasn’t raised in a timely manner, so it was ignored in the Court’s opinion. But Judge Kavanaugh, in a separate concurrence, specifically mentioned it with seeming approval. A couple of months later, a commercial company (Live365) raised the same argument in a U.S. District Court and lost; Live365 appealed that loss, but ultimately settled out before its appeal got too far along.
The third time’s the charm. Intercollegiate properly raised the argument in its own 2011 appeal and the D.C. Circuit has now spoken. Because the Librarian of Congress (who appoints CRB members) was very limited in his/her ability to remove CRB members, and because the CRB was not subject to the direction and supervision of any “principal officer”, well, then, CRB members are themselves “principal officers”. Not having been appointed by the President, they cannot function consistently with the Appointments Clause.
Not to worry, though. Relying on an approach used by the Supreme Court in a similar situation in 2010, the D.C. Circuit has opted to “invalidat[e] and sever the restrictions on the Librarian of Congress’s ability to remove” CRB members. By reading those pesky provisions out of the CRB law as Congress wrote it, the court figures that the CRB will henceforth be constitutional.
Constitutional, that is, as long as the Librarian of Congress is a “Head of Department” (as required by the last line of the Appointments Clause). No problem there, either, according to the D.C. Circuit: the Library of Congress is a “component of the Executive Branch” (meaning that it’s a “department”, constitutionally speaking), so the Librarian of Congress is a “Head of Department”. QED. (To get to this point, the Circuit had to tiptoe around at least one earlier case that suggested that the Library of Congress was a “congressional agency”.)
Bottom line: The CRB wasn’t constitutional, but now (with the helpful intervention of the D.C. Circuit) it is.
Where does that leave orders issued by the CRB back in its benighted, unconstitutional days? The particular order that was the subject of Intercollegiate’s appeal has been vacated and shipped back to the CRB – that would be the New and Improved CRB, Now With Real Constitutional Authority! – for further consideration. While Intercollegiate did, of course, raise some substantive gripes about the old CRB's royalty ruling, it'll be back to square one for those gripes. Intercollegiate will have to present them again to the CRB. If, as one might expect, the new CRB does exactly what the old CRB had done, royalty-wise, Intercollegiate will have to bring its gripes back up to the D.C. Circuit all over again. But next time, it won't have the Appointments Clause argument in its holster.
It’s possible that others subject to previous CRB rulings could now claim that those rulings have no force and effect, thanks to the D.C. Circuit’s decision. Whether or not anybody will view that as a worthwhile exercise remains to be seen.
This is the point where we would ordinarily observe that the losing party before the D.C. Circuit can still seek rehearing, or maybe even Supreme Court review. Chances of further appeals in this case, however, are effectively zero. Intercollegiate won its appeal, so it’s not likely to ask for further consideration by the Circuit or the Supremes. And the CRB isn’t likely to, either. After all, the Circuit’s decision saved the CRB from unconstitutional oblivion – why would the CRB want to appeal that? So we’re guessing that, with the judicially-imposed revisions to the Congressionally-enacted CRB statute in place, life at the CRB will go on largely as it has in the past.