Irving Azoff Sets Stage For Radio Royalty Rumble

By on Dec, 8 2016 with Comments 0

The battle over royalty payments owed to artists represented by music industry titan Irving Azoff‘s public-performance-right licensing agency Global Music Rights (GMR) looks to be a fierce once, with action set to take up lots of court time and billable hours piling up for the attorneys involved.

On Nov. 18, the The Radio Music License Committee announced the filing of an antitrust complaint against GMR, asserting that it is engaged in anti-competitive activities that could lead to unfettered fees for all works in the GMR repertory.

Now, GMR has counter-sued the RMLC, calling it “an illegal cartel.”

In a 49-page civil complaint and demand for jury trial, GMR attorneys at O’Melveny & Myers LLP state, “The RMLC accomplishes its objective, and has for decades, by exercising market dominance and brazenly violating competition laws.  RMLC stations represent more than 90% of the country’s terrestrial radio revenue.  No songwriter can afford to be silenced on a platform that reaches 245 million listeners weekly.  Unable to negotiate freely and fairly, and under threat of a group blockade from radio, the songwriters and the companies that represent them are forced to capitulate to the artificially depressed license fees the RMLC cartel demands.”

The suit adds that RMLC and its members “reject the free market,” which would “wreak havoc” on “their artificially low cost structure.”

It continues, “Radio station owners do not want to pay the license fees that a free market would demand for GMR songwriters’ premium content.  Rather than embracing the market and competing with one another, the RMLC’s members took the opposite tack by colluding.  Representing over 90% of the terrestrial radio industry, the RMLC flexed their collective muscle to attempt to force GMR to submit to a mandatory licensing scheme and artificially depressed license fees.  Unless GMR succumbs to these monopsonistic demands, GMR songwriters will not have access to the vast majority of terrestrial radio stations, a media outlet that remains crucial for songwriters’ financial and reputational success.”

The RMLC traditionally represents a large number of  commercial radio stations in the U.S. on music licensing matters involving ASCAP, BMI, and more recently, SESAC.

The filing of the GMR complaint came following the summer 2015 settlement of similar litigation between RMLC and SESAC.

This lawsuit, on behalf of GMR’s 71 songwriters, was filed in U.S. District Court for the Central District of California.

In a statement issued in response to GMR, RMLC Executive Director Bill Velez stated, “GMR’s lawsuit is an obvious ploy designed to pressure the RMLC in response to the antitrust suit the RMLC filed against GMR in federal court in Philadelphia last month. GMR now tries to hide from reality:  The fight between the RMLC and GMR stems from GMR’s attempt to impose monopoly pricing on the radio industry, and the RMLC’s opposition to that plan.”

Velez adds that GMR’s claim that the RMLC is a cartel is “frivolous and offensive,” and said the RMLC looks forward to defeating GMR’s claims in court.

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About The Author: Adam R Jacobson is a veteran radio industry journalist and advertising industry analyst with general, multicultural and Hispanic market expertise. From 1996 to 2006 he served as an editor at Radio & Records.

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