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.

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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.”

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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.

ABOUT BMI:
Celebrating over 77 years of service to songwriters, composers, music publishers and businesses, Broadcast Music, Inc.® (BMI®) is a global leader in music rights management, serving as an advocate for the value of music. BMI represents the public performance rights in nearly 13 million musical works created and owned by more than 800,000 songwriters, composers, and music publishers. The Company negotiates music license agreements and distributes the fees it generates as royalties to its affiliated writers and publishers when their songs are performed in public. In 1939, BMI created a groundbreaking open-door policy becoming the only performing rights organization to welcome and represent the creators of blues, jazz, country, and American roots music. Today, the musical compositions in BMI’s repertoire, from chart toppers to perennial favorites, span all genres of music and are consistently among the most-performed hits of the year. For additional information and the latest BMI news, visit bmi.com, follow us on Twitter @BMI or stay connected through Broadcast Music, Inc.‘s Facebook page. Sign up for BMI’s The Weekly™ and receive our e-newsletter every Monday to stay up to date on all things music.