US DoJ appeals against fractional licensing ruling
The US Department of Justice (DoJ) has appealed against a decision made in September by a New York federal judge that performing rights organisation Broadcast Music Inc (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.
WIPR previously reported that BMI had emerged victorious in the decision, made by Judge Louis Stanton at the US District Court for the Southern District of New York on September 16 this year.
Previously, BMI, which licenses public performance rights, had been bound by consent decrees implemented by the DoJ.
In place since 1941, the decrees are designed to prevent competition concerns arising from licensing.
But on November 11, the DoJ filed a notice that it was appealing against the decision to the US Court of Appeals for the Second Circuit.
Mike O’Neill, president and CEO of BMI, said that the organisation was not surprised by the decision to file an appeal.
“It is unfortunate that the DOJ continues to fight for an interpretation of BMI’s consent decree that is at odds with hundreds of thousands of songwriters and composers, the country’s two largest performing rights organisations, numerous publishers and members of the music community, members of Congress, a US governor, the US Copyright Office and, in Judge Stanton, a federal judge,” he said.
Back in 2014, the DoJ and its Antitrust Division began a review into the decrees after requests from 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 in August this year, the DoJ claimed that “no modifications are warranted at this time”. BMI challenged this decision.
ASCAP also issued a statement on the notice of appeal.
Beth Matthews, CEO of ASCAP, said that the Second Circuit’s ruling “will affect the rights of more than a million American songwriters and composers, thousands of whom have expressed strong opposition to the DOJ’s position, and we are hopeful the court will affirm Judge Stanton’s decision”.
She added: “ASCAP looks forward to resolution of this matter as we continue to advocate for modernising the consent decrees for today’s world.
