Blur drummer Dave Rowntree has launched a class action lawsuit against PRS For Music, accusing the collecting society of breaching UK and EU competition rules in relation to unallocated royalties. He is requesting that all 160,000 writer members of the organisation be beneficiaries of the action.
The musician, working with law firm Maitland Walker, claims in a recent legal filing that PRS misallocates ‘black box’ income. These are royalty payments that have been received by the society but, usually due to a lack of data, it doesn’t know which members to pass the money on to. The lawsuit claims that PRS handles this income in a way that benefits music publishers more than songwriters.
“I’ve agreed to be class representative because musicians’ royalties, perhaps to the tune of hundreds of millions of pounds, have been paid to the wrong people”, says Rowntree. “It’s because of bad data and processes, and in today’s digitally connected world, there’s no excuse for either”.
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PRS denies the allegations made against it in the filing, which was submitted to the Competition Appeal Tribunal last week.
In the UK, royalties from the broadcast and performance of songs are collected on behalf of songwriters and publishers by PRS. It then distributes those royalties to the members whose music has been used, with 50% usually flowing to the writer and 50% to the publisher.
However, in some cases it doesn’t know which specific members to pay, usually because it doesn’t have data about what specific songs were broadcast or performed. Those unallocated royalties - often referred to in the industry as the ‘black box’ - are then distributed to members based on a set of distribution rules, with money usually being allocated based on market share.
The new lawsuit claims that there is no transparency on exactly how this money is shared out, and alleges that far more of it should be flowing to songwriters than is currently the case. However, it adds, as much of the income that is in the ‘black box’ gets there because of incorrect or missing data, it is difficult to establish exactly what is owed.
In a statement to its members, PRS wrote: “PRS For Music rejects the allegations set out in this claim, which are factually incorrect and fundamentally misrepresent our policies and operations. PRS is owned by its members and its rules, which are robust and determined by members, treat the interests of both writers and publishers fairly”.
It says that the legal claim is based on “a misinterpretation of PRS’ governance and operational practices” and adds that it “provides far greater transparency than other collecting societies”.
Adding that it has been “constructively engaged” with the lawyers who have now gone legal with this claim for over two years, it concludes, “Unfortunately, this means PRS will need to allocate significant resources to defend a proposed class action brought in the name of members - against their own society. Nonetheless, PRS will continue to operate in the best interests of its members by robustly defending itself against these allegations”.
Rowntree is himself a trained solicitor, although currently not practising, and is currently also preparing to stand as an MP for the Labour Party in Mid Sussex at the next General Election.
His class action lawsuit is structured to automatically include all 160,000 writers who have been members of PRS since March 2017 - although they are able to opt out if they so wish. All those who remain opted in will be able to share in any award granted by the court, should the claim be successful.
Further information on the legal action is available at prssongwriterclaim.co.uk