On Thursday night (May 17, 2018) the Radio Music License Committee (RMLC) filed a lawsuit against BMI in rate court at the U.S. Federal Court of New York (Southern District). The basis of the filing has been an ongoing 17 month issue were RMLC is trying to lower the royalty rate it will pay BMI for the 2017-2021 term period.
The issue goes back to January 2017, when the RMLC agreed to the American Society of Composers, Authors and Publishers (ASCAP) for a 1.73% of revenue in a deal which has increased to 1.75%, which is not slated to end until 2021. RMLC set ASCAP’s market share at 48% and BMI’s at roughly 40%, in the attempt to reduce BMI’s rate to 1.70%. This set the stage for conflict during end of the last deal reached on Dec. 31, 2016.
“BMI has spent more than two years attempting to negotiate a new rate with the Radio Music License Committee (RMLC) that fairly and accurately reflects the scope and quality of the music we represent,” BMI executive VP of licensing & creative Mike Steinberg said in a statement. “As anticipated, the RMLC is trying to use a below-market rate they negotiated with the only US PRO they were able to come to an agreement with; an agreement based on flawed market share data and one that has since been made irrelevant by newly-agreed to and adjudicated rates in the marketplace. We look forward to presenting our position before the Court and demonstrating the dominance of BMI’s repertoire.”
When RMLC filed for the interim rate to be 1.70%, BMI’s filing rebuttal statement included, “The RMLC can point to no changed circumstances that warrant a reduction in BMI’s interim or final rate. BMI believes that the market developments will support a final rate of greater than 1.7 percent of gross revenue payable to BMI.”
The honorable Judge Louis Stanton will preside over the rate trial. As a side note, the pending Music Modernization Act calls for all rate court cases to be rotated among all the judges serving in the U.S. Federal Court of New York (Southern District). However, this will not change the current case assignment, even if the pending legislation becomes law soon, according to multiple sources.
Matt and his family currently reside in the Washington, D.C metro area.
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