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20 September 2016Copyright

BMI successful against US DoJ in music licensing case

Performing rights organisation Broadcast Music Inc (BMI) has emerged successful from its licensing tussle with the US Department of Justice (DoJ), after a ruling by a New York federal judge.

BMI, which licenses public performance rights, including by radio stations and online streaming services, had been bound by consent decrees implemented by the DoJ.

The decrees, which have been in place since 1941, are designed to prevent competition concerns arising from licensing.

The order, issued by Judge Louis Stanton at the US District Court for the Southern District of New York on September 16, held that BMI may use “fractional licensing”.

Fractional licensing involves each rights owner ‘greenlighting’ its portion of a song to establish a licence, a long-established industry practice.

In August this year, the DoJ had said that on songs written by multiple writers, any writer or rights owner could issue a licence for the entirety of the song, known as “full-works licensing”.

The DoJ and its Antitrust Division started a review into the decrees in 2014 after requests from both the American Society of Composers, Authors and Publishers (ASCAP) and BMI.

The division met and spoke with industry stakeholders and workers as well as members of the public. But, on August 4, the DoJ said that “no modifications are warranted at this time”. BMI challenged this decision.

In his ruling, Stanton said: “The consent decree neither bars fractional licensing nor requires full-work licensing.”

He added: “If a fractionally-licensed composition is disqualified from inclusion in BMI's repertory, it is not for violation of any provision of the consent decree.”

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