Irving Azoff's performing-rights company Global Music Rights (GMR), which sought to upend the way radio stations license music when it launched in 2013, has won a small victory in its ongoing legal battle with the Radio Music License Committee (RMLC) in Pennsylvania federal court.
In the ruling, which was issued Friday, judge C. Darnell Jones II ruled he does not have "personal jurisdiction" over GMR in the antitrust case. GMR was sued by the RMLC in 2016 for seeking "extortionate" licensing rates for its slate of artists, including Bruce Springsteen, Drake, Pharrell Williams and Pearl Jam frontman Eddie Vedder. RMLC negotiates licensing fees for around 10,000 U.S. radio stations, or about 90 percent of the U.S. market.
"I am thrilled with today's victory," said Azoff in a statement provided to Billboard. "Now Global Music Rights gets to expose the radio cartel's bullying tactics. It's always worth the wait when artists win."
From the very beginning, GMR set itself up as an alternative to ASCAP and BMI, the big two performance-rights organizations (PROs) that negotiate licensing fees on behalf of songwriters. GMR's stance is detailed in a mission statement on its website positioning the company as an "active and progressive advocate for copyright holders in the current performing rights marketplace."
The rates charged by ASCAP and BMI have long been governed by an arbitration process under judicial consent decrees, an arrangement that has remained in place since 1941 and 1966, respectively. When it launched in 2013 after poaching over 70 artists from ASCAP and BMI, GMR approached the RMLC to negotiate licenses, but the two parties could not come to an agreement and in 2016 the RMLC sued GMR in Pennsylvania court.
Among other things, RMLC accused GMR of leveraging "the competitive vacuum created by judicially-monitored consent decrees over the two largest PROs in the industry" by signing a "strategic group of songwriters" whose works few radio stations can live without. In essence, they argue, GMR has "created an untenable and illegal situation wherein RMLC's members are forced to either pay overly priced licensee fees to GMR or face copyright infringement claims" for playing the works of GMR's songwriters.
In turn, GMR filed suit against RMLC in Los Angeles court, accusing RMLC of illegally restraining licensing fees paid to songwriters.
Rather than rule on the underlying disagreements between the two parties, Jones simply decided on the matter of jurisdiction. RLMC's case will now be transferred to federal court in Los Angeles, where Jones ruled that jurisdiction does apply. This can be counted as a legal win for GMR, who had accused RMLC of filing in Pennsylvania to gain a "tactical advantage." GMR's separate suit against RMLC has been on hold pending the results of the Pennsylvania case.
GMR and RLMC are currently operating under an interim licensing agreement pending the outcome of the lawsuits.