Occasionally in music copyright legal battles entirely unrelated legal disputes suddenly become relevant. And that has happened again this month in the ongoing litigation involving streaming service Pandora and US collecting society The MLC. Which means we now need to talk about some horses.
Pandora reckons a precedent set earlier this month in a lawsuit involving the US National Horsemen’s Benevolent & Protective Association backs up its claim that The MLC should not be able to pursue its lawsuit against Pandora, which centres on how US copyright law should be interpreted when it comes to the obligations of music streaming services to pay mechanical royalties.
For its part, The MLC has already fired back via a court submission insisting that the horses dispute is, in fact, totally irrelevant and does not impact on its ability to sue Pandora one bit.
Needless to say, the legal dispute involving the NHBPA - “the largest racing horsemen’s representative association in North America”, no less - has nothing to do with music copyright. Instead it centres on the ‘private non-delegation doctrine’, which - according to Reuters - is a legal principle that says neither US Congress nor the US government should allow non-government entities to exercise governmental power.
Pandora claims that The MLC, which exists to administer the mechanical rights compulsory licence that exists in US copyright law, is doing exactly that by interpreting the law around that licence and then enforcing its interpretation through litigation. Because it’s basically a private entity, that conduct “violates the private non-delegation doctrine”.
That said, US copyright law specifically says that The MLC can file lawsuits against entities that make use of music without the required mechanical rights licences in place.
Which brings us back to the horse racing litigation, which focuses on powers granted to the NHBPA by the US Horseracing Integrity And Safety Act.
In a recent court filing, Pandora notes that the most recent judgement in the horse racing dispute, in the Fifth Circuit Appeals Court, ruled that “the Horseracing Integrity And Safety Act violates the private non-delegation doctrine because the statute assigns federal enforcement authority, including the authority to bring civil litigation, to private entities without agency supervision”.
And that decision, Pandora’s legal filing argues, “is persuasive authority in support of Pandora’s argument that the MLC’s asserted authority to prosecute this action violates the private non-delegation doctrine”.
All of which means, the Fifth Circuit court ruled that the horseracing act violates the private non-delegation doctrine by allowing the NHBPA, a private entity, to enforce the law without sufficient supervision from a relevant government agency. Pandora reckons that The MLC is similarly trying to enforce copyright law without the necessary supervision.
But not so, says The MLC in its own filing. It provides various arguments for why the ruling in the horse racing case is not relevant to its Pandora dispute. But most important is the fact The MLC’s work is closely overseen by the Copyright Office within the Library Of Congress, the most relevant statutory body. Which means in the case of The MLC, it is fulfilling its regulatory tasks with agency supervision.
Running through how that supervision works, The MLC explains that it is appointed by the Librarian Of Congress, as are the voting members of its board, and they can be removed by the same person. Which means The MLC is “subject to pervasive oversight by the Librarian and the Register of Copyrights such that The MLC and its directors function subordinately to them in all areas”.
Therefore, it adds, “Pandora cannot escape liability in this action by reference to the limited discussion of the private non-delegation doctrine” in the latest ruling in the horse racing case. Because, unlike the NHBPA, its work is closely supervised.
As for the actual copyright arguments in The MLC v Pandora case, that all relates to the fact that the mechanical royalties administered by The MLC only need to be paid by interactive streaming services. But The MLC argues that Pandora should be paying those royalties on its non-interactive service as well, because it includes an ad-funded option that allows users to go interactive for 30 minutes at a time.