US Department of Justice sides with GMR in its conflict with radio broadcasters

By Emmanuel Legrand 

The US Department of Justice has stepped into the conflict between Global Music Rights (GMR), the music licensing and rights management firm set up by artist manager Irving Azoff, and the Radio Music Licensing Committee (RMLC), which negotiates music licensing rates with content owners, by taking the side of GMR.

  GMR sued the RMLC in 2016, accusing the radio group to act like a cartel. The RMLC counter-sued, arguing that rights societies operated like a monopoly. The two organisations are expected to go to trial in 2020.

  In a filing with the court, the DoJ’s Antitrust Division argued that "competitors’ naked agreements to fix prices are one of the most pernicious forms of anti-competitive restraints that violate Section 1 of the Sherman Act.” 

A win for songwriters

  GMR said the statement of interest from the DoJ was "a setback for the RMLC" and "a significant win for GMR and all songwriters." It added in a statement: "GMR has consistently maintained that members of the RMLC illegally collude with one another to suppress rates paid to songwriters and composers for the public performance of their work." 

Daniel Petrocelli, lead counsel for GMR, said the court filing by the DoJ "reaffirms the legal position of GMR and vindicates the rights of artists and songwriters to be free from illegal price-fixing by radio station."

Added Azoff: “Today is a great day for artists, who have been bullied by the RMLC since the dawn of the modern radio industry. Advocating on behalf of artists is our founding principle, and we refused to allow this unfair status quo to continue. We believe the days of this brazen, long-running cartel are now numbered. GMR has never been prouder to stand with songwriters to fight back.”

Follow-up story: 
RMLC asks California court to dismiss comments made by the Department of Justice in its conflict with GMR

The Radio Music Licensing Committee (RMLC), which negotiates music licensing rates for the performance of music works in the USA with content owners, has rebuked the recent intervention of the Department of Justice in RMLC's conflict with music licensing and rights management society Global Music Rights (GMR).

  GMR has accused to RMLC to act as a cartel and the RMLC counter-sued, arguing that GMR and other performance rights societies were a monopoly.

  On December 5, 2019, the DoJ's Antitrust Division’s December 5 filed a Statement of Interest with the California court, arguing that “competitors’ naked agreements to fix prices are one of the most pernicious forms of anti-competitive restraints that violate Section 1 of the Sherman Act.”

A puzzling statement

  In a filing with the District Court in the Central District of California, the RMLC wrote that the DoJ's Statement of Interest was “puzzling” and argued that the DoJ “does not appear to have an actual interest in RMLC’ spending motion for judgment on the pleadings.” 

  The RMLC said the DoJ “asked the Court to 'reject' arguments that RMLC has not made” and that “without citing any supporting authority, the Division seems to ask this Court to be the first one in history to condemn as per se unlawful a proposal to use arbitration to avoid protracted antitrust litigation in federal  court.”

  Finally, the RMLC added that the DoJ did not address “two of the independent arguments that RMLC has made for dismissal, so none of the points addressed in the Division’s filing is dispositive of the outcome of the motion at issue.”

Dismiss GMR's claims

  The filing continued: “Although there may be cases where the Division’s stated interest in assuring that courts apply antitrust law fairly and correctly could assist federal district judges in resolving novel legal issues of first impression, this case has no such issues. It requires only a straightforward application of the uncontroversial binding law of this Circuit to the allegations of GMR’s complaint. There is nothing unique or difficult about that exercise that requires the court to consider the unsolicited views of a federal agency. And the Court does not owe any deference to the Division’s views on either the law or its application to the facts here.”

  In its conclusion, the RMLC asked the court to “still grant RMLC’s motion for judgment on the pleadings and dismiss all of GMR’s claims.”