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Global Music Rights must continue with radio industry fight in Pennsylvania, says Californian court

By | Published on Thursday 16 August 2018

Irving Azoff

A judge in California has declined to resume litigation involving mini collecting society Global Music Rights and the Radio Music License Committee, reckoning that the ongoing dispute between the two parties should instead continue in the courts of Pennsylvania.

GMR, of course, is the boutique performing rights organisation that was set up by artist manager Irving Azoff. It represents the performing rights of a small but very well formed gang of acclaimed songwriters. In doing so, it competes for members with the three other PROs that operate in the US, them being BMI, ASCAP and SESAC. Though broadcasters wanting to play music written by any songwriter need a licence from all four.

Because BMI and ASCAP both represent such large catalogues of songs, they are regulated by the US Department Of Justice through the so called consent decrees, which are meant to overcome competition law concerns that are often raised about collective licensing. SESAC, although not governed by a consent decree, agreed to third party mediation on royalty disputes during a past legal battle with the RMLC.

Since Azoff set up GMR, the RMLC has been busy trying to force it to also accept third party mediation. RMLC argues that GMR is another music licensing monopoly that should be subject to some regulation. GMR counters that, as a boutique rights agency, it has nothing even near to a monopoly over song rights, and therefore should be able to negotiate licensing deals without third party interference. It then usually adds that if there are any monopolies in this dispute it’s the RMLC, which claims to speak for the majority of US broadcasters.

This whole dispute went legal in November 2016 when the RMLC sued GMR in the Eastern District Court of Pennsylvania. A few weeks later GMR sued RMLC in California, arguing that Pennsylvania was the wrong place for this dispute to be heard, given the radio licensing group is based in Nashville, Tennessee and GMR in LA. While RMLC does represents station across the US, it has lots more members in California than Pennsylvania. By suing in the latter state, GMR then claimed, the radio industry group was basically “forum shopping”.

GMR tried to have RMLC’s lawsuit in Pennsylvania dismissed, meanwhile the Californian case was put on hold pending the outcome of the Pennsylvanian litigation. In May this year GMR asked that the Californian case be resumed, arguing that the lawsuit in Pennsylvania was dragging, and this was “wreaking havoc” because broadcasters and others were using the ongoing lawsuit as an excuse not to negotiate licences to utilise songs repped by the rights body.

GMR again accused RMLC of forum shopping, while asking the Californian judge to resume its lawsuit there so that a discovery process could begin. But said judge, Terry J Hatter Jr, has declined to lift the stay on the GMR v RMLC lawsuit in his state.

According to Law 360, he noted that the so called ‘first-to-file’ rule meant this dispute should be fought out via the Pennsylvanian lawsuit. “Here, Global Music argued that the court should decline to apply the first-to-file rule because RMLC forum shopped when it filed the Pennsylvania action in anticipation of this action”, Hatter wrote. “However, Global Music failed to provide any evidence that RMLC filed the Pennsylvania action in anticipation of this action”.

He then said that “Global Music’s argument that the stay should be lifted because it is prejudiced by not being able to initiate discovery is misplaced”, saying that if GMR wanted to being the discovery process, it could do so in Pennsylvania.

Back in that state both sides await a ruling on GMR’s bid to dismiss RMLC’s action. A report by a magistrate judge on the dispute recommended last year that it should indeed be dismissed, allowing the whole case to shift to California. But RMLC then responded to that report, and GMR responded to RMLC’s response, and everyone is now waiting for a final ruling on the matter.

According to Law 360, when it asked the Californian court to restart its lawsuit there, GMR claimed that that during a case status conference in Pennsylvania it had been told by a clerk that an unidentified “conflict that developed” within chambers was preventing that court from knowing when it would be able to rule on the dismissal bid. And so we keep on waiting.