This week, the lawsuit brought by the Radio Music License Committee (RMLC) against new performing rights organization GMR (Global Music Rights) for alleged violations of the antitrust laws was determined by a court in Pennsylvania to have been brought in the wrong place – and transferred to a court in California. This case has been on hold for well over two years while this procedural question was ironed out. Now that the case has been transferred to California, the litigation that has been on hold while the jurisdictional issue was resolved can begin – but don’t expect quick results as these complicated cases can take years to resolve. What is involved in this case?
Back in 2016, when RMLC concluded that it was not likely to reach a negotiated royalty rate for radio’s use of the musical compositions controlled by GMR songwriters and publishers, it brought the Pennsylvania court action. In that action, it argued that the rates that GMR wanted were an abuse of the market power that GMR was able to exercise by banding these songwriters together and offering a license to radio stations on an all-or-nothing basis (see our articles here and here for more on the initial suit). As it had done successfully with SESAC (see our article here), and as has been the case for decades with ASCAP and BMI, RMLC had hoped to have the court declare that GMR’s unrestrained royalty demands were contrary to the antitrust laws, and that some limits should be imposed on those rates. The RMLC suit against GMR was brought in the same Pennsylvania court in which RMLC had sued SESAC, which led to the settlement subjecting SESAC rates to arbitration if the parties could not voluntarily agree on rates (and the arbitration process ultimately resulted in significantly lower rates for commercial radio than SESAC had previously received – see our article here on the results of the arbitration).