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GMR’s radio industry legal battle to relocate to California

By | Published on Tuesday 2 April 2019

Global Music Rights

The ongoing dispute between America’s mini collecting society GMR and the US radio industry will relocate to a court in California, which was the former’s preference to start with.

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 radio industry’s Radio Music License Committee.

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.

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 countersued 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 stations 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”. But, despite those allegations, the countersuit in California was put on hold pending the outcome of the case in Pennsylvania. Attempts by GMR to have the Californian case restarted last year then failed.

However, the judge overseeing RMLC’s Pennsylvanian lawsuit has now declared that he doesn’t have jurisdiction, presumably because of the reasons previously argued by GMR. According to Billboard, judge C Darnell Jones II ruled on Friday that he does not have “personal jurisdiction” over the LA-based music rights group. As a result, RMLC’s case will now be transferred to a court in California.

Although Jones made no comment on the respective arguments of RMLC and GMR regarding the rights and wrongs of how the latter should license the former, it does mean the case will now be argued in the state of preference for the collecting society. So this latest development can be classified as a small win for Azoff and his team.