Business

How This Week's House Judiciary Committee Vote Could Have Big Consequences For the Music Business

The United States Capitol building
Win McNamee/Getty Images

The United States Capitol building

On Wednesday (Dec. 20), Rep. Jerrold Nadler (D-N.Y.) is expected to face Rep. Zoe Lofgren (D-Calif.) in a Democratic Caucus vote to determine who will become the ranking member of the House Judiciary Committee, with substantial power to shape copyright law. Both are fairly liberal Democrats, but their views on copyright are so different that the result will shape the current reform process -- and perhaps the future of the music business.

The House Judiciary Committee is important to the music business because it has jurisdiction over intellectual property, among other issues, and Committee Chairman Bob Goodlatte (R-Va.), who began a copyright reform process several years ago, wants to pass significant legislation before he retires next year. The ranking member -- the minority party’s counterpart to the chairman -- has substantial power to set the agenda for that process.

“The leadership of the House Judiciary Committee -- both the chairman and the ranking member -- is incredibly important to the music community,” says Michele Ballantyne, RIAA executive vp for public policy and industry relations. If Democrats recapture a House majority in 2018 -- which, after Doug Jones’ victory over Roy Moore in Alabama, now looks merely difficult as opposed to all but impossible -- Nadler or Lofgren could become the next chairman. The party vote will also test how much influence Silicon Valley still has in Washington compared to the creative sector.

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There aren’t many members of Congress who are viewed more favorably by the music business than Nadler, who represents parts of Manhattan and Brooklyn. This year, he joined other members of Congress to introduce the Fair Play Fair Pay Act to make terrestrial radio stations pay the owners and performers of recordings, as well as the CLASSICS Act (Compensating Legacy Artists for their Songs, Service, & Important Contributions to Society Act), which would require online radio services to pay royalties on pre-1972 sound recordings. Lofgren, whose district includes most of San Jose, is more skeptical of copyright and has been accused of being too close to Alphabet, which opposes strong copyright laws.

For most of the last two decades, the House Judiciary Committee’s ranking member has been Rep. John Conyers (D-Mich.), who stepped down from that position in November and resigned from Congress early this month. Democrats generally give the ranking member position to the senior committee member, which in this case is Nadler, who was given the job on an interim basis. But Lofgren wants the position as well, and she and Nadler have spent the last several weeks vying for the support of their fellow Democrats.

At a time when national politics are so divisive, the differences between Nadler and Lofgren might seem minor -- they’re both lawyers who represent liberal areas of blue states, and they’ve generally worked well together. But it would be hard to find two members or Congress who better represent the divide between Democrats who champion the success of Silicon Valley and those who want to regulate it.

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“This is a test case for where Democrats are going to be on technology,” says a former House Judiciary Committee staffer.

The most important issues are antitrust, privacy and, most contentious, copyright. In 2012, Lofgren co-sponsored the Internet Radio Fairness Act, a bill pushed by Pandora that would have cut online radio royalties. In March, Lofgren opposed The Register of Copyrights Selection and Accountability Act, which would make the Register a presidential appointee.

Lofgren said she opposed the bill for organizational reasons. But she also “played the race card,” according to a Congressional staffer, presumably in an attempt to sway the Congressional Black Caucus. “I have no idea what their reasoning is, but for the first time in history, an African-American woman [Dr. Carla Hayden] is the Librarian [of Congress] and for the first time in history we’re taking away her power to appoint a Register of Copyrights,” Lofgren told Politico in April, adding that this wasn’t implying a sinister motive. (The idea of moving the Copyright Office out of the Library of Congress actually preceded Hayden’s appointment.) That argument didn’t go over well with some African-American legislators, according to Congressional staffers, since Conyers, a Civil Rights activist who co-founded the Congressional Black Caucus, had introduced the bill with Goodlatte. (The bill passed the House, then stalled in the Senate.)

The Democratic caucus will choose the ranking member this week in a two-step process: The Steering and Policy Committee of the House Democratic Caucus will vote on a recommendation Tuesday (Dec. 19), and the entire caucus will vote Wednesday morning. Nadler has seniority and strong support, but Congressional staffers say Lofgren has the backing of House Minority Leader Nancy Pelosi (D-Calif.), as well as the advantage of being a woman at a time when the Democrats need to demonstrate a commitment to diversity.

Money matters, too, since committee leadership positions help legislators raise money that they can then give to other members. That gives Lofgren an advantage because of her close relationships with technology companies, which are ramping up their political spending in response to the prospect of regulation. During the 2016 election cycle, according to the Intercept, Nadler donated $100,000 to the Democratic Congressional Campaign Committee, while Lofgren gave $270,000.

Lofgren’s ties to Silicon Valley could also hurt her, especially since the House Judiciary Committee also has jurisdiction over competition law. She’s a top recipient of donations from Silicon Valley, and both her former chief of staff and former senior legislative counsel now do public policy work for technology companies. And while Lofgren recently said Congress should examine whether some companies get an unfair competitive advantage from holding massive amounts of data on consumers, her interest in this topic is relatively new -- in June, she accused the European Commission of pursuing its own antitrust investigation against Google for political reasons.

Nadler doesn’t stand outside of issues of money and politics, of course: During the 2016 election cycle he received more money from the RIAA than any other Democrat in Congress. At this point, however, technology companies just have far more money to donate. Nadler actually got more money from Alphabet than he did from the RIAA, and Lofgren received more money from Alphabet than Nadler did. 

It’s hard to know how much this kind of money matters, and what the Democratic platform for 2020 will look like. But there could be a hint on Wednesday.

Bill Clark/CQ Roll Call
Zoe Lofgren
Andrew Burton/Getty Images
Jerry Nadler  
Jerry Nadler  Andrew Burton/Getty Images