A Tarzana, Calif.-based independent label has filed an antitrust suit against Sony BMG Music Entertainment, alleging that the major label’s radio promotion activities are anticompetitive.
In its action, TSR Records — which has released a variety of pop, dance, flamenco and jazz records, largely in the 12-inch disco single format — uses information revealed in documents issued by New York State Attorney General Eliot Spitzer’s office in July as evidence of widespread payola activities on the part of Sony BMG.
TSR lodged its suit, which alleges violation of federal and state antitrust statutes and conspiracy to interfere with prospective economic advantage, on Tuesday in U.S. District Court for the Central District of California in L.A. The action seeks damages in an amount to be determined at trial.
In July, Sony BMG — whose promotion abuses were damningly depicted in documents issued by Spitzer — agreed to broadly modify its promotion practices and pay a $10 million fine as part of a settlement with the attorney general (HR 7/26). Two Clear Channel Communications programrs were fired this month following an internal investigation by the radio chain (HR 10/13).
According to its action, TSR — whose CEO Tom Hayden is a former radio promotion man — has been in business for 25 years and “has had numerous songs and artists that were very big sellers or were high-ranking on non-radio charts, such as dance charts or new age charts.
“However,” the suit continues, “TSR’s sound recordings could not ‘break out’ into the mainstream because of the interference by (Sony BMG) and their stranglehold on radio station air time and play lists … .”
TSR alleges that “there are thousands of independent record labels and artists whose music has been systematically excluded from radio station air time and playlists as a direct result of (Sony BMG’s) anticompetitive activities.”
Noting Sony BMG’s settlement with Spitzer — the first such agreement to be reached as a result of the attorney general’s yearlong investigation of the record business — TSR claims that the major “has a history of providing radio stations with a variety of benefits to unlawfully obtain airplay and boost the chart position of its songs.”
TSR’s litany of Sony BMG’s alleged abuses employs wording virtually identical to that employed by Spitzer’s office in its July “assurance of discontinuance” agreement with Sony BMG. The label accuses the major of issuing outright bribes to radio programrs; paying stations to cover operational expenses; utilizing indie promoters as conduits for illegal radio payments; and paying for “spin programs” under the guise of advertising.
Sony BMG’s alleged payola activities have “permanently disrupted” TSR’s relationship with radio stations, according to the suit.
A Sony BMG spokesman said the company does not comment on pending litigation.