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Is the Copyright Royalty Board Unconstitutional? - Take Two:

On Tuesday, I noted the U.S. Court of Appeals for the D.C. Circuit's decision in SoundExchange, Inc. v. Librarian of Congress, in which it largely rejected a challenge to royalty rates set by the Copyright Royalty Board. Judge Kavanaugh wrote a separate concurrence noting that the manner of the CRB's appointment raises constitutional concerns. Yet SoundExchange had not challenged the constitutionality of the CRB, so the question was not before the court.

If SoundExchange wanted to challenge the royalty rates set by the CRB, why did it fail to press the constitutional challenge? Invalidating the CRB would seem to be an effective way of voiding the royalty rates at issue. Was it bad lawyering? I don't think so. Rather, it appears that SoundExchange made a strategic decision because invalidating the CRB altogether would be adverse to its economic interests and compromised its position in other proceedings.

Yesterday, a separate panel of the D.C. Circuit decided Intercollegiate Broadcast System, Inc. v. Copyright Review Board. SoundExchange was again a party, this time as an intervenor on the side of the CRB. In this case, the Intercollegiate Broadcast System (IBS) and others challenged the CRB's decisions setting rates and terms relating to webcasting and designating SoundExchange as the sole royalty collective. At some point in the litigation, petitioners argued the appointment of Copyright Royalty Judges to the CRB is unconstitutional, because the judges are appointed by the Librarian of Congress. Here, SoundExchange defended the CRB's constitutionality and argued the petitioners had forfeited the argument by not raising it in a timely fashion.

Had SoundExchange pressed the constitutional challenge in the first case, it could have produced an adverse result in the second -- and SoundExchange may have had more to lose from this result than it had to gain. Moreover, as a repeat player in copyright royalty disputes, SoundExchange could prefer fighting over the merits of individual decisions than forcing a complete restructuring of the administrative structure governing copyright royalties. Repeat players in other regulatory contexts often behave the same way, and larger challenges to administrative proceedings, whether constitutional or otherwise, are often brought by marginal industry players who are less invested in the structure of the status quo.

In any event, the D.C. Circuit again passed on the constitutional question, concluding the petitioners had forfeited the constitutional argument. Instead, the D.C. Circuit addressed petitioners' challenges to the CRB decisions on the merits, vacating the $500 minimum fee for both noncommercials and commercials but otherwise upholding the CRB's determinations. And so, resolution of the underlying constitutional question will have to wait for another day.

martinned (mail) (www):
This again raises the question of principle posed by stevesturm in the original thread:

And you lawyers find nothing wrong with Kavanaugh ignoring the constitutional issue because no one raised it? it's okay to ignore unconstitutional situations if nobody complains? how does that serve justice?

In the first case, the question wasn't briefed, which seems like a defensible reason for the court not to rule on the matter. Here, the question was briefed (at least partly), but the court decided that it was "forfeited" because it wasn't raised in a timely fashion. Should courts be allowed to avoid the constitutional question so easily?

Essentially the constitutional angle is treated like any other aspect of the case: use it or lose it. (Aka, you snooze, you lose.) Don't constitutional questions, especially those with prima facie merit, deserve more priority than that?
7.11.2009 9:42am
Cornellian (mail):

And you lawyers find nothing wrong with Kavanaugh ignoring the constitutional issue because no one raised it? it's okay to ignore unconstitutional situations if nobody complains? how does that serve justice?


Federal courts are constitutionally empowered to hear only "cases or controversies." If neither party raises an issue, there is no "case or controversy" between them on that issue and the federal court cannot rule on that issue, no matter how interesting or important it may consider the issue to be. That applies even to constitutional issues, with a few rare exceptions (e.g. subject matter jurisdiction) and this isn't one of the exceptions. It's one huge difference between the courts, the executive and the legislature. The executive and the legislature can prioritize whatever they think is important on a day to day basis. The judiciary deals only with what parties place before them.

Thus, Judge Kavanaugh's one-man crusade to invigorate the Appointments clause will have to wait another day.
7.11.2009 10:42am
Anyglen:
The problem with stevesturm's position, despite its intuitive appeal, is that exempting certain "very important" questions from procedural forfeiture rules is a difficult principle to contain.

In criminal litigation, for example, defendants not infrequently attempt to raise arguments for the first time on appeal and find them barred by procedural default. Reasonable people can disagree about whether this is a good idea—and the relative balance between finality/administration concerns and trying to do justice in an individual case. Regardless, though, it'd be hard to justify an exception for constitutional issues for constitutional issues, especially ones like this where, after a period of chaos, Congress would presumably just fix the problem, but not for deprivations of individual liberty. All of a sudden, waiver starts disappearing across the board.
7.11.2009 10:47am
martinned (mail) (www):
@Cornellian: Well, that approach to the "case or controversy" criterion is certainly the law at the moment.

It is not, however, the only way to interpret the case or controversy requirement. There was an actual dispute before the court, with two parties arguing over law, and there was a constitutional question pertinent to that dispute. In the first case, the question wasn't briefed. That doesn't, imho, mean that the plain text of the constitution forbids the court from going near it, but it is defensible that it wouldn't. In this case, though, the constitutional question was raised, but it was declared out of bounds for procedural reasons. My question wasn't whether that was the right decision, since it probably was, but rather whether that ought to be the approach.

Shouldn't it be easier for the courts to raise constitutional questions sua sponte, or at least harder for them to duck such issues?
7.11.2009 10:51am
martinned (mail) (www):
@Anyglen: Fair enough, but in criminal cases I would argue that the problem isn't the possibility that defendants might raise the constitutional question only on appeal, but rather the possibility that such issues might drag on almost indefinitely through collateral review, etc.

The basic three step of trial court, appeals court and supreme court, followed possibly by a cert petition if the case was originally in state court, needn't take that long. It's the possibility of state and federal habeas review that makes US criminal litigation take so much longer than similar cases in other countries. (Altough, of course, the draconic nature of US criminal penalties does necessitate some additional safeguards.)
7.11.2009 10:56am
Anyglen:
A follow up question to Cornellian's comment:


Federal courts are constitutionally empowered to hear only "cases or controversies." If neither party raises an issue, there is no "case or controversy" between them on that issue and the federal court cannot rule on that issue, no matter how interesting or important it may consider the issue to be. That applies even to constitutional issues, with a few rare exceptions (e.g. subject matter jurisdiction) and this isn't one of the exceptions.


Does this waiver actually implicate the "case or controversy" requirement? There clearly remains a controversy between the Board and the plaintiff--the validity of the Board's actions. I don't think that the case or controversy requirement turns on the decision to pursue one legal theory over another. Am I wrong?
7.11.2009 11:04am
Cornellian (mail):
In this case, though, the constitutional question was raised, but it was declared out of bounds for procedural reasons. My question wasn't whether that was the right decision, since it probably was, but rather whether that ought to be the approach.

Shouldn't it be easier for the courts to raise constitutional questions sua sponte, or at least harder for them to duck such issues?


The downside to letting people raise constitutional questions (or legal questions in general) at a later stage of the proceeding is that you don't have a factual record for the appellate court to consider, and deciding legal questions in the abstract is almost always a bad idea (which is part of why there's a case or controversy requirement). Also if neither party raised an issue, there's usually a good reason why they didn't and the court doesn't know those reasons. So if the court asks the parties to brief issue X, one side pro-X the other side anti-X, you run the risk that the briefing will be unreliable because both sides are really pro-X or anti-X.

So if you have a system where a person can raise a constitutional question for the first time on appeal, that system has to have a way of addressing these problems.

Right now courts do have some ability to raise constitutional questions sua sponte. An appeals court, for example, can ask the parties to brief an issue neither party has raised. That's pretty rare, but there is some limited scope to get an issue on the table at a later stage of a proceeding.
7.11.2009 2:52pm
Soronel Haetir (mail):
Cornellian,

One problem I have with procedural waiver of constitutional issues is that they are matters of law. An appeals panel is actually in a better position to evaluate such claims.
7.11.2009 3:48pm

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