When a major overhaul to music copyrights became law last fall, the biggest immediate impact on radio was that songs recorded before Feb. 15, 1972 would no longer be exempt. That means oldies or classic rock stations playing songs that predate that cutoff are now required to pay royalties on those spins whenever those tracks are streamed online.
The law also included a provision designed to help broadcasters avoid potential lawsuits to collect royalties under state laws on those records. But to secure that protection, a station must file required paper work and make a one-time payment to SoundExchange by July 8. And the Radio Music License Committee recommended fees be paid by that date to ensure that immunity for state law-related claims is secured.
Not so fast, however, cautions a new post on the CommLawBlog from DC law firm Fletcher, Heald & Hildreth. “Attention oldies stations (or others who play pre-72 recordings): Think twice before you pony up three years of royalties under the new MMA Provision,” write attorneys Kevin Goldberg and Karyn K. Ablin.
Webcasters who have streamed – but not paid for – pre-72 sound recordings from Oct. 11, 2015 were told they could pay SoundExchange for those recordings, and would, in turn, be immune from potential state law infringement suits for that streaming (and related reproductions). But “this potential benefit applies to far fewer webcasters and is far less valuable” than many may believe, so “before you open your checkbook and go running off to SoundExchange,” Fletcher, Heald & Hildreth presents three caveats “which may cause many, if not most, webcasters to reject this offer.”
First, and most obvious, if a station did not stream pre-72 recordings at all in the last three and a half years, “the provision is irrelevant, as you don’t need to worry about a state infringement suit in the first place.” As well, if an outlet did stream pre-72 recordings in the last three and a half years, “but you already paid SoundExchange for them even though you were not obligated to, the provision also is irrelevant because you already unnecessarily paid SoundExchange for streaming those recordings,” they point out.
Third and perhaps most significant, Goldberg and Ablin point out that if a station did stream pre-72 recordings and excluded them from SoundExchange statutory royalty payments, but “streaming was focused in states that do not recognize a public performance right in those recordings, such as New York or Florida, then again, “the provision similarly is irrelevant, as pre-72 owners have no basis to sue you for infringement in those states.”
The attorneys stress: “It is only those webcasters who stream numerous pre-72 recordings to states that recognize – or likely would recognize – a state public performance right in pre-72 recordings and have not paid SoundExchange or the relevant copyright owners for these performances who should even think about paying what can best be termed ‘protection money.’”
Further, they say, “We are not aware of any states where pre-72 recording owners have successfully litigated the pre-72 performance rights issue to a final, unappealable decision.” And finally: “Remember that the clock is ticking – you only have until July 8 to decide how to respond, if at all, to this provision.”