BMI Appeals DMX Rate Court Decision Enabling Expansion of Direct Licensing and Lower License Fees

Film Music Magazine • September 8, 2010

BMI has filed an appeal of the DMX decision issued by Judge Louis Stanton, BMI’s rate-court judge to the United States Court of Appeals for the Second Circuit. BMI’s appeal on behalf of its songwriters, composers and music publishers will seek reversal of a court decision that, according to DMX’s outside counsel, will allow DMX to “pay fees approximately 65% lower than those sought by BMI.”

The rate court decision also formalizes terms for a “blanket carve-out license” which has the potential to substantially expand direct licensing by broadcasters such as television networks and cable channels who hold blanket licenses with U.S. royalty societies. The blanket carve-out license essentially provides broadcasters with a blanket license, but also includes the ability for broadcasters to reduce their blanket license fees when musical works such as score music is licensed directly from composers or publishers. The move is likely to increase pressure on composers and songwriters to license directly to broadcasters, removing the performing rights societies from these licensing transactions. For more information on the rate court ruling, visit http://www.filmmusicmag.com/?p=5992

“On behalf of our songwriters, composers and music publishers, we will not allow this ruling to stand without an appeal,” said Del Bryant, BMI President & CEO. “Our writers and publishers should not be expected to lose more than half of their income from DMX based on the court’s erroneous holdings, which substantially reduce the value of their creative efforts.”

In a statement, BMI noted that U.S. Performing Rights Organizations have a long history of negotiating performing right license agreements on behalf of songwriters, composers and music publishers with market leaders in the commercial background music service (CMS) industry, of which DMX is a part. BMI stated, “The court noted in its decision that, except for DMX, nearly the entire CMS industry accepted the BMI form agreements. However, the court rejected these marketplace benchmark agreements and instead relied on a small number of direct licenses negotiated by DMX that set fees at a deeply discounted level. The court record contained substantial evidence that these direct licenses did not represent an appropriate BMI license fee. The DMX direct-license agreements provided for a $25 annual per-location license fee (for both BMI and ASCAP music). The prevailing market rate before the court decision for both BMI and ASCAP music was more than $77 per location — more than three times the reduced value set by the court.”

The appeal is expected to be taken up by the Court before the end of 2010.

Comments

By Joseph Nicoletti Consulting/Promotion on September 9th, 2010 at 9:04 am

Unless we have ASCAP/BMI and All people like them to be the Watch dog for Our Creative Rights,it would all be Down loaded for free (or just about free!) ..
it is funny that the Lawyers and Courts that Copyrighted works should be under valued ,,.. do They work for min wage? of course not,..with out the Music/Songs/Performers/Producers/Publishers on and on What would All the People & culture Enjoy ?….Oldies / 9not that I do not Enjoy them,But You know what I mean).. Joseph Nicoletti Consulting/Promotion P.o.Box 386 Laguna Beach California 92652 USA ph 949-715-7036 E-Mail: musicbiz@cox.net

By George Anderson on September 9th, 2010 at 11:47 am

Go BMI! Thanks for standing up for musicians and artists!

By Brian Hartzog on September 10th, 2010 at 2:43 am

I dunno…may be easier to get paid directly. Has anyone ever had luck getting BMI to pay without prompting them that they owed you?

Brian

By Timm yPhelps on September 11th, 2010 at 5:40 am

Reminds me of a time when I used to get $250 – $300 to play a solo guitar or piano gig in a nice resteraunt – then someone would come in and do it for $100. Pretty soon that guy got all the work. Oh,if you were good you could keep your gig but it now paid $150 (maybe). Where’s the Unions when you need ’em?

By Composer on April 12th, 2011 at 6:04 am

Now don’t you think it’s funny.
the PRO thieves have been stealing our money for years and now the corporations will steal our money with the direct license. The PRO’s blew this when they undervalued score and incidental music. Now it can and will be direct licensed.
What about all those library composers who wrote for APM, Universal etc.
those catalogs have all been purchased by broadcasters such as NBC, Warner etc.
The PRO’s are standing the brink of a huge slap and the composers stand in the middle left holding nothing.
Damn shame

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