United States Court of Appeals
FOR THE DISTRICT OF CO LUM BIA CIRCUIT
Argued February 17, 2005 Decided April 8, 2005
No. 04-5138
UNIVERSAL CITY STUDIOS LLLP AND
UNIVERSAL CITY STUDIOS PRODUCTIONS LLLP,
APPELLANTS
v.
MARYBETH PETERS ,
IN HER OFFICIAL CAPA CITY AS REGISTER OF COPYRIGHTS, AND
COPYRIGHT OFFICE,
APPELLEES
No. 04-5142
METRO -GOLDWYN-MAYER STUDIOS, INC.,
APPELLANT
v.
MARYBETH PETERS , THE REGISTER OF COPYRIGHTS OF THE
UNITED STATES OF AMERICA ,
APPELLEE
Appeals from the United States District Court
for the District of Columbia
(No. 03cv01082)
(No. 03cv00179)
2
Randolph D. Moss argued the cause for appellants Univer-
sal City Studios, et al. With him on the briefs were Thomas P.
Olson, Edward N. Siskel, and Brian M. Boynton.
David E. Kendall argued the cause for appellant Metro-
Goldwyn-Mayer Studios, Inc. With him on the briefs was Vidya
S. Atre.
James J. Gilligan, Attorney, U.S. Department of Justice,
argued the cause for appellees Marybeth Peters, et al. With him
on the brief were Peter D. Keisler, Assistant Attorney General,
Kenneth L. Wainstein, U.S. Attorney, Gregory G. Katsas,
Deputy Assistant Attorney General, and Mark B. Stern, Attor-
ney.
Before: SENTELLE and ROBERTS, Circuit Judges, and
WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge ROBERTS.
ROBERTS, Circuit Judge: Cable and satellite companies are
required to pay royalties into a common fund when they
retransmit certain copyrighted television broadcasts. To collect
from the fund, copyright owners must file claims with the
Copyright Office annually during the month of July. In 2001,
Metro-Goldwyn-Mayer Studios (MGM) and Universal City
Studios had their claims rejected as untimely because they could
not produce a stamped postal receipt showing that the claims,
which were received at the Copyright Office in August, had
been mailed in July. The studios challenged the rejections in the
district court and now appeal a grant of summary judgment for
the Copyright Office. We affirm.
I.
Congress has established a compulsory licensing scheme for
broadcast copyrighted material that is retransmitted by cable and
satellite companies. See 17 U.S.C. §§ 111, 119 (2000); Nat’l
Ass’n of Broadcasters v. Librarian of Congress, 146 F.3d 907,
3
910–13 (D.C. Cir. 1998) (summarizing statutory framework).
Under this arrangement, cable and satellite companies are
permitted to retransmit broadcasts of over-the-air television
programming, provided that they deposit royalty fees with the
Copyright Office for eventual distribution to copyright owners.
Copyright owners, in turn, must file their claims for royalties
“[d]uring the month of July in each year” and “in accordance
with requirements that the Librarian of Congress shall prescribe
by regulation.” Id. §§ 111(d)(4)(A), 119(b)(4)(A). Royalties
are distributed proportionally by means of settlement agree-
ments among the various claimants or arbitration. See Distribu-
tion of 1998 and 1999 Cable Royalty Fund, 68 Fed. Reg. 17,838
(Apr. 11, 2003).
Copyright Office regulations specify that a claim will be
considered timely if the claim (1) was actually received by the
Office during July, or (2) bears a July U.S. postmark and was
sent via the United States Postal Service. 37 C.F.R. § 252.4(a)
(2001). The regulations also expressly state that “[c]laims dated
only with a business meter that are received after July 31, will
not be accepted as having been timely filed.” Id. § 252.4(c).
There is an exception to that provision, however, specifying that
if a claim was sent using certified mail return receipt requested
and the claimant can produce a mailing receipt bearing a July
U.S. Postal Service date stamp, the claim will be accepted as
being timely filed. Id. § 252.4(e). The regulations provide that
“[n]o affidavit of an officer or employee of the claimant, or of
a U.S. postal worker will be accepted in lieu of the receipt.” Id.
The facts at issue are straightforward. MGM and Universal
are film and television production studios based in southern
California. MGM’s royalty claims for the year 2000 arrived at
the Copyright Office on August 2, 2001. The envelope was sent
by certified mail and bore only a stamp from a Pitney Bowes
business postage meter. Universal’s claims arrived the next day,
also by certified mail and bearing only a Pitney Bowes postage
4
meter stamp. Both studios estimate the value of their claims in
the millions of dollars.
The studios heard nothing from the Copyright Office until
November 2001, when each received word that their claims
would not be accepted unless they could produce a receipt with
a July U.S. Postal Service date stamp. Even at this remove, we
can sense the intensity of the searches that these letters must
have precipitated, but neither studio was able to locate a receipt.
Lacking a receipt, the studios mobilized their lawyers. They
separately responded with letters arguing that their claims were
timely filed because they had been mailed during July, which
was all the studios understood the Office’s rules to require.
They submitted sworn statements from the employees responsi-
ble for mailing the claims, stating that the letters were mailed on
July 30, 2001. In addition, they presented declarations from
Postal Service employees about the normal delivery time for a
letter sent from southern California to Washington, D.C. (three
to five days) and statements from Pitney Bowes employees
attesting that the machines used by the studios are tamper-proof.
Universal later supplemented its initial submission with the
results of an in-house experiment showing that none of one
hundred letters sent to Washington from Van Nuys, California
arrived in fewer than three days — suggesting that its own
claim, which arrived on August 3, must have been sent during
July. In the event the Office interpreted its rule to require a
postal receipt, each studio also requested a waiver.
The Copyright Office reached a final decision rejecting the
studios’ claims on December 2, 2002. It interpreted its rules to
require a stamped USPS receipt for all claims received after the
end of July that do not bear a U.S. postmark. The Office
dismissed the evidence submitted by the studios, pointing to the
regulations’ express bar on considering affidavits from claimant
or Postal Service employees “in lieu of the receipt.” See 37
C.F.R. § 252.4(e). Moreover, it rejected the studios’ waiver
5
requests on the ground that they presented no “special or unique
circumstance . . . that would warrant a waiver.” Letter to Olson
& Moss, Dec. 2, 2002, at 6; Letter to Tunberg, Dec. 2, 2002, at
5.
The studios filed complaints in the district court alleging
that the Office had acted in violation of the Copyright Act, the
Administrative Procedure Act, and the Due Process Clause of
the Fifth Amendment. The court found no merit to these
contentions and, in two separate opinions, granted summary
judgment for the Office. Metro-Goldwyn-Mayer Studios, Inc. v.
Peters, 309 F. Supp. 2d 48 (D.D.C. 2004); Universal Studios
LLLP v. Peters, 308 F. Supp. 2d 1 (D.D.C. 2004). The studios
appeal.
II.
The studios present several challenges to the Office’s
rejection of their claims. First, MGM, but not Universal, argues
that the Office has incorrectly interpreted its regulations
regarding timely submission of claims. Second, both studios
argue that the denial of their waiver requests was arbitrary and
capricious because the Office has not consistently enforced its
regulations regarding timely filing. Third, the studios argue that
the Office violated due process by refusing to accept any
evidence, other than a stamped postal receipt, that their claims
were mailed in July. We review de novo the district court’s
grant of summary judgment. Williams v. United States, 396
F.3d 412, 413 (D.C. Cir. 2005).
A. MGM argues that the Office’s insistence on a postal
receipt, and exclusion of all other evidence of a July filing, is
“incompatible” with the Copyright Act and the implementing
regulations. The regulations do not, it argues, categorically bar
consideration of other evidence. MGM Br. at 25. On the
contrary, it maintains, the regulations’ specific exclusion of
affidavits from claimant employees and postal workers implies
6
that other evidence will be considered. In addition, MGM relies
on the language of section 252.4(e), which states that a claimant
“may” prove proper filing by means of a stamped receipt, to
argue that the requirement is only permissive and that claimants
may prove proper filing by other means as well. See 37 C.F.R.
§ 252.4(e).
This is quite a stretch. The rules make clear that claims
arriving after July that do not bear a U.S. postmark will not be
accepted unless the claimant can produce a stamped receipt.
Section (c) states the general rule very clearly: “Claims dated
only with a business meter that are received after July 31, will
not be accepted as having been timely filed.” Id. § 252.4(c).
Section (e) provides for the one and only exception to this rule
for claims without a U.S. postmark: “[i]n the event that a
properly addressed and mailed claim is not timely received by
the Copyright Office,” claimants “may nonetheless prove”
proper filing using a receipt. Id. § 252.4(e). In other words, the
rule is only “permissive” in that it allows claimants their one
means of escaping the consequences of section (c).
Similarly, the provision excluding certain affidavits cannot
fairly be understood to imply that the Copyright Office is
required to consider other evidence. The regulations’ evident
purpose is to exclude precisely the kind of factual inquiry MGM
seeks. See Copyright Arbitration Royalty Panels; Rules and
Regulations, 61 Fed. Reg. 63,715, 63,716 (Dec. 2, 1996) (“The
only acceptable proof of a timely filing . . . is the certified mail
return receipt bearing a U.S. Postal Service mark demonstrating
that the mailing occurred during the relevant time period to the
appropriate address.”); Copyright Arbitration Royalty Panels, 59
Fed. Reg. 63,025, 63,039 (Dec. 7, 1994) (postmark requirement
“provides a bright line test which should end all questions of
fact regarding the timeliness of the claim”). The express
exclusion of the sort of evidence most likely to be submitted in
lieu of a receipt — far from opening the door to other eviden-
7
tiary submissions — was simply a way to “make assurance
double sure.” WILLIAM SHAKESPEARE , MACBETH act 4, sc. 1.
An agency’s interpretation of its own rules is entitled to
“substantial deference” and will be set aside only if “plainly
erroneous or inconsistent with the regulation.” Thomas Jeffer-
son Univ. v. Shalala, 512 U.S. 504, 512 (1994) (citation omit-
ted); see also Carus Chemical Co. v. EPA, 395 F.3d 434, 439
(D.C. Cir. 2005). That is certainly not the case here; we have no
basis on which to set aside the Office’s reading of the pertinent
regulations to bar the studios’ claims as untimely.
B. MGM and Universal next argue that the Copyright
Office’s failure to waive its rules and accept their claims was
“arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with law.” 5 U.S.C. § 706(2)(A); see 17 U.S.C §
701(e). In making this claim, the studios run up against another
highly deferential standard. While an agency is required to
consider a waiver request, see BellSouth Corp. v. FCC, 162 F.3d
1215, 1224 (D.C. Cir. 1999), we will disturb a denial of waiver
only when “the agency’s reasons are so insubstantial as to render
that denial an abuse of discretion,” BDPCS, Inc. v. FCC, 351
F.3d 1177, 1181–82 (D.C. Cir. 2003) (citation omitted). An
“agency’s strict construction of a general rule in the face of
waiver requests is insufficient evidence of an abuse of discre-
tion.” Omnipoint Corp. v. FCC, 213 F.3d 720, 723 (D.C. Cir.
2000) (citation omitted).
The studios principally argue that the Copyright Office
failed to apply an established policy of accepting claims where
it could be assured the claim was in fact mailed in July. For its
part, the Office acknowledges a policy of accepting all claims
that arrive by mail on August 1, but denies any more extensive
waiver policy. The pertinent policy is set out in a 1995 Copy-
right Office letter:
8
[T]he Office has decided to accept all properly addressed
claims with only a business meter postmark if they were
actually in the Copyright Office on August 1, 1995, since
the Office has an absolute assurance that these claims must
have been deposited with the U.S. Postal Service during the
month of July in order to reach the Office by August 1,
1995. The Office, however, will not accept any properly
addressed claim with only a July business meter postmark
which arrives in the Office on August 2, 1995, or later,
because the absolute assurance of a July mailing with the
U.S. Postal Service does not apply.
Letter to Artis, Aug. 23, 1995, at 1; see also Letter to Adams,
Aug. 23, 1995, at 1. MGM and Universal argue that — given
the declarations submitted by them and Universal’s delivery-
time experiment — the Office has the same “absolute assur-
ance” their claims were mailed during July as it has for claims
arriving on August 1.
The Office, however, gave a more than adequate explana-
tion why its policy does not apply. In referring to its having an
“absolute assurance,” the Office did not commit itself to
conducting case-by-case inquiries into the factual circumstances
of each claim submission. Rather, its “decision applies a bright-
line test . . . and does not require the Office to rely on extrinsic
evidence or to engage in determining the probability that a claim
was mailed in July.” Letter to Olson & Moss, at 7. The Office’s
“absolute assurance” refers instead to its confidence that every
claim arriving on August 1 was mailed in July, without the need
for any inquiry concerning the circumstances of mailing. The
policy expressly states, after all, that the Office will not accept
claims arriving on August 2 or later — a qualification clearly at
odds with the studios’ more expansive understanding of the
policy.
The studios also seek refuge in several anomalies in the
Office’s handling of claims from a decade ago. MGM finds one
9
instance in 1993 in which the Copyright Royalty Tribunal,
which formerly handled royalty claims, accepted a late-filed
claim from a claimant named Brissette TV.1 Brissette’s claim
had been returned for an insufficient address, even though the
same address had effected delivery of its claims in prior years.
Universal points to two other instances of waiver. In one,
occurring in 1994, the Office agreed to accept a postal receipt
with a handwritten date, rather than an official date stamp. In
the other, a Copyright Office staff person accepted a claim after
conferring with an employee of the Joplin, Missouri post office,
from which the claim had been mailed, about a receipt that “had
not been dated by the Postal Service in the usual manner.”
Letter from Gilligan to Kendall & Atre, June 13, 2003, at 1.
We cannot see how these episodes rendered the Office’s
denial of waiver an “abuse of discretion.” BDPCS, Inc., 351
F.3d at 1181–82. First, it is not at all clear that any of them are
indicative of the Office’s current policies. The Brissette case
was handled by a different administrative body altogether.
Since it first started handling royalty claims in 1993, the
Copyright Office has insisted that “it is not the successor agency
or office to the Copyright Royalty Tribunal.” Copyright
Arbitration Royalty Panels; Rules and Regulations, 59 Fed. Reg.
2550, 2551 (Jan. 18, 1994). As far as handwritten receipts are
concerned, the regulations were revised in 1996 to require an
official date stamp — a policy the Office has consistently
applied since. 61 Fed. Reg. at 63,716–17; see, e.g., Letter to
Freeman, Feb. 17, 1999, at 1 (rejecting receipt with handwritten
date). In the Joplin case, about which little is known, the staff
person’s decision to confer with the post office was apparently
1
The Copyright R oyalty Tribunal handled cable and satellite
royalty claims until 199 3, when that responsibility was transferred to
the Copyright Office. See Copyright Royalty Tribunal Reform Act of
1993, Pub. L. 103-198, 107 Stat. 2304.
10
unauthorized, and accordingly cannot rise to the level of agency
precedent.2 See Vernal Enterprises, Inc. v. FCC, 355 F.3d 650,
661 (D.C. Cir. 2004) (“staff error cannot bind an agency and
force it, in effect, to continue such errors”).
Second, even if these instances in fact represent current
Office policy, they hardly cover the present cases. Two
involved receipts that were handwritten or improperly stamped.
There is an obvious difference between considering the manner
in which a submitted receipt has been executed and overlooking
the complete absence of one. In the Brissette case, the claimant
was given a one-time break because of its reliance on an address
that had worked in previous years. Nothing of the sort is
involved here; the present cases go instead to the core of a rule
clearly intended to preclude case-by-case inquiries into the time
of mailing. Granting a waiver based on the perceived strength
of the evidentiary submission in a particular case would deprive
such a rule of all force.
The studios ran a considerable risk by mailing their claims,
presumably, in the last days of July; they ran another risk by
failing to have their claims postmarked by the U.S. Postal
Service. None of this would matter had the studios been able to
locate the required receipts, but they have been unable to do so.
We would not go so far as the Motion Picture Association of
America and urge claimants to guard receipts “with your life,”
but the consequences of being unable to produce them were
clear. Kessler Memorandum, June 13, 2001, at 7. The regula-
tions gave the studios three different ways to establish the
timeliness of a claim — actual receipt in July, July U.S. post-
mark, or July date-stamped postal receipt. The studios’ three
strikes hardly suggest the kind of “special circumstances” that
2
W hile the Brissette waiver is set out in a letter from the
Copyright Royalty Tribunal, details of the Jop lin and handwritten-date
waivers are known only through the recollections of Office personnel.
11
might warrant waiver. Northeast Cellular Tel. Co. v. FCC, 897
F.2d 1164, 1166 (D.C. Cir. 1990).
C. Finally, the studios contend that the Office violated their
due process rights. There can be no question that the Office
gave the studios a meaningful opportunity to be heard concern-
ing whether their claims satisfied the Office’s regulations,
including the postal receipt requirement. See Coalition of
Airline Pilots Ass’ns v. FAA, 370 F.3d 1184, 1188 (D.C. Cir.
2004). The studios’ due process challenge instead focuses on
the receipt requirement itself. Their argument proceeds from the
premise that the critical issue is whether they mailed their claims
in July; the studios then contend that the Office has improperly
restricted the means by which a claimant may prove such timely
mailing, in violation of due process.3
This argument is entirely unpersuasive. MGM and Univer-
sal can rightly claim a property interest in the royalties to which
they are entitled by law. See Bd. of Regents of State Colleges v.
Roth, 408 U.S. 564, 577 (1972); Bloch v. Powell, 348 F.3d 1060,
1068 (D.C. Cir. 2003). They are entitled, however, to nothing
if they do not meet the terms of eligibility under the statute and
its implementing regulations. See Am. Mfrs. Mut. Ins. Co. v.
Sullivan, 526 U.S. 40, 60–61 (1999). The studios assume that
they are entitled to royalties if they can prove they mailed their
claims in July, but this “misconstrues the Copyright Act and its
regulations by equating mailing with filing.” Universal Studios,
3
The studios present their due process arguments differently.
Universal argues that only the “substantive” provisions of the
Copyright Act, and not the “procedural proof-of-filing rule,” define
the scope of its property interest. Univ. Br. at 54–55. M GM argues
that the regulations create an unconstitutional irrebuttable presumption
that a claim was not prop erly filed absent a stamped postal receipt.
MGM Br. at 31–32. For our purposes, these arguments amount to the
same thing.
12
308 F. Supp. 2d at 15; see 17 U.S.C. §§ 111(d)(4)(A),
119(b)(4)(A) (claimants must file “[d]uring the month of July in
each year” and “in accordance with requirements that the
Librarian of Congress shall prescribe by regulation”). As the
Supreme Court recently confirmed, “due process does not
require the opportunity to prove a fact that is not material to the
. . . statutory scheme.” Conn. Dep’t of Pub. Safety v. Doe, 538
U.S. 1, 4 (2003). Under the regulations, the studios are not
entitled to royalties on a claim that arrives in August without a
July U.S. postmark or a stamped postal receipt, regardless of
how compelling the proof may be that the claim was mailed in
July. The regulations themselves — all of them — define what
constitutes proper filing, under the express terms of the statute.
See United States v. Locke, 471 U.S. 84, 103 (1985). And under
those regulations, the studios are out of luck.
Affirmed.