Global Music Rights 2018

Thirty-six documents. That is what the latest dust-up between the radio industry and Global Music Rights is centered on as the four-year old legal dispute between the Radio Music License Committee and GMR moves forward. The antitrust case is now in the discovery phase where each side is requesting documents and interviewing key players.

The focus is on three dozen documents that the RMLC produced involving Cox Media Group and VP of Business Operations Clayton Nix, who is a member of the RMLC’s executive committee. GMR says just days before Nix was to be deposed, the RMLC “clawed back” the documents claiming they were privileged. Then a few days after Nix was deposed by GMR lawyers, the RMLC changed course again and released 16 documents. RMLC said the other 20 were protected by attorney-client privilege and pointed out they produced thousands of other documents.

What is in that paperwork is not known but GMR is asking the court to force the RMLC to turn over the documents saying its claims of privilege are “specious” and it is entitled to their contents. It also thinks it should be allowed to re-interview Nix on the documents that were withheld when they met with him.

The RMLC is asking U.S. District Court Judge Terry Hatter to reject that request. It says GMR has failed to adequately explain the legal basis for its challenge of the clawed-back documents while also demanding 150 others from the radio industry. RMLC also thinks Hatter should reject any request to depose Nix a second time, saying that it tried to get GMR to hold off until their dispute was resolved but it refused. “GMR proceeded with these tactics at its own risk,” it said.

Disputes during the discovery phase are fairly common in lawsuits, but the standoff is emblematic of what has kept the case going for so many years. Hatter in August signed-off on a request that will push several deadlines into 2022. Based on the current schedule, he will allow the discovery process to continue through next April with the final pre-trial hearing set for next July. If all goes as planned, the trial dates will be set at that hearing. But based on the typically crowded calendar that federal judges keep, that may not get underway until 2023.

For stations, the net effect is the status quo will continue. In March 2020, just prior to the COVID lockdowns, GMR switched from offering radio stations six-month interim deals to license the music in the performance rights organization’s repertoire to annual agreements. This year’s came with a 20% rate increase for commercial stations versus the prior interim deal.

Some broadcasters have opted to sign deals directly with GMR in order to have some clarity on what their royalty payments will be. Audacy joined the list in April reportedly followed by Cumulus Media giving them access to GMR’s catalog of hit songs from artists such as Nicki Minaj, Drake, Bruce Springsteen and Prince across all their on-air and digital platforms. iHeartMedia also has a direct deal with GMR.

The faceoff began in November 2016 when the RMLC filed an antitrust lawsuit in federal court in Philadelphia alleging GMR violated federal law when it allegedly created an “artificial monopoly” to squeeze higher rates from stations. Two weeks later GMR replied with an antitrust lawsuit of its own, which contended the radio consortium is essentially an “illegal cartel.” In April 2019 the Philadelphia case was dismissed and the two sides have been doing battle in Los Angeles.