Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Justice Department seeks comments on modifications to ASCAP, BMI consent decrees, (Jun 4, 2014)

By Greg Hammond, J.D.

As part of the Department of Justice Antitrust Division’s review of the operation and effectiveness of its consent decrees, the agency is seeking comments on two decrees with performance rights organizations American Society of Composer, Authors and Publishers (ASCAP) and Broadcast Music, Inc. (BMI).

ASCAP’s and BMI’s consent decrees (U.S. v ASCAP, 2001-2 Trade Cases ¶73,474) and (U.S. v BMI, 1996-1 Trade Cases ¶71,378) were entered in an effort to address competitive concerns that arose from the organizations’ acquired market power through the accumulation of public performance rights held by their music publishers and songwriters. Since they were originally entered, the Antitrust Division has periodically reviewed and amended them, with the last amendment made to the ASCAP consent decree in 2001 and the BMI consent decree in 1994.

The Justice Department’s review of the two consent decrees comes after it discovered that ASCAP, BMI, and other music industry firms believed the decrees “need to be modified to account for changes in how music is delivered to and experienced by listeners.” Consequently, the Antitrust Division is seeking information and comments on whether the decrees still protect competition. Although ASCAP and BMI enforce copyrights, administer copyright royalties, and monitor for unlicensed uses, the Department noted that it is mostly concerned with receiving comments on competitiveness in relation to joint licensing of music and remediation.

Specifically, the Justice Department is seeking public comment from interested individuals, such as songwriters, composers, licensees, publishers, and service providers, on:

(1) whether the consent decrees still serve important competitive purposes and whether any provisions are no longer necessary or are ineffective in protecting competition;

(2) what modifications can be made to better competition and efficiency;

(3) whether the two consent decrees adversely affect competition;

(4) what is the degree of difficulty in obtaining the organizations’ repertory and whether modifications to transparency requirements are warranted;

(5) whether the decrees should be amended to provide rights holder with the ability to allow the organizations to license their performance rights to some music users and not to others, and if so, whether there should be any limits on how those partial or limited grants are structured;

(6) how resolution of fee disputes can be expedited, when interim fee payments should begin, and whether the rate court’s rate-making function should be modified to mandatory arbitration; and

(7) whether the decrees should be amended to allow right holders the ability to grant ASCAP and BMI additional rights, besides the rights of public performance.

Comments should be submitted by August 6, 2014.

Companies: American Society of Composer, Authors and Publishers; Broadcast Music, Inc.

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