Radio Industry Files SESAC Anti-Trust Complaint
October 11, 2012. Nashville, TN. The Radio Music License Committee (“RMLC”) has announced the filing of an antitrust complaint against SESAC concerning anticompetitive behavior that allows SESAC to charge the U.S. commercial radio industry monopoly prices to publicly perform musical works in the SESAC repertory. The RMLC is the industry group that has traditionally represented several thousand commercial radio stations in music license matters with ASCAP and BMI. In fact, the filing of the SESAC complaint comes on the heels of the RMLC’s recent settlements of longstanding litigations with both ASCAP and BMI.
SESAC, a public-performance-right licensing agency, is distinguished from ASCAP and BMI in that it is a privately-held, for-profit firm that has created a bottleneck to, and artificial monopoly over, the works in its repertory. Unlike SESAC, ASCAP and BMI are subject to consent decrees established with the Department of Justice, which prevent monopoly pricing because they permit music users to apply to federal court to resolve rate disputes the parties cannot resolve voluntarily. Thus far, SESAC has managed to avoid similar limits on its monopoly pricing.
The RMLC complaint follows the class action antitrust lawsuit that the local television industry filed against SESAC in late 2009. That lawsuit remains pending, following the Federal District Court’s decision to deny SESAC’s motion to dismiss the lawsuit.
The RMLC complaint alleges that SESAC is a per se illegal cartel that has eliminated all competition between its affiliates and that has created a monopoly over the works in its repertory. RMLC seeks injunctive relief, requiring, among other things, that SESAC submit to a judicial rate-making procedure comparable to what the consent decrees governing ASCAP and BMI impose. The complaint was filed in the U.S. District Court for the Eastern District of Pennsylvania by the law firm of Latham & Watkins, on behalf of the RMLC as the sole plaintiff in the action.
In recent years, the radio industry has faced a serious challenge in terms of restoring reasonable license fee levels during difficult economic times. The aforementioned ASCAP and BMI settlements achieved much in terms of placing the industry on a sound footing once again but SESAC remains an anticompetitive force in the industry.
RMLC Chairman, Ed Christian, commented that “resorting to litigation is never a first reflex for the RMLC. This legal process will undoubtedly prove to be taxing in terms of the amount of labor and expense involved. Yet, we feel that SESAC’s pattern of increasingly exorbitant rates imposed on our industry without resort to a fair process has left us with no other alternative. We hope that the good will demonstrated by ASCAP and BMI in working with our industry to achieve mutually agreeable licenses will inform this new challenge with SESAC.”SESAC Complaint
Copy of the complaint by the law firm of Latham & Watkins:
RMLC Defeats SESAC Motion to Dismiss Antitrust Complaint
Local TV Industry Settles Anti-trust Complaint Against SESAC
Click HERE for Press Release
Local TV Industry Files SESAC Anti-trust Complaint (2009)
TV Broadcasters Sue SESAC (from Billboard magazine)
November 04, 2009 - Legal and Management | Publishing
By Ed Christman, N.Y.
A group of television broadcasters have filed a class-action anti-trust complaint against SESAC, according to the Television Music License Committee, a non-profit organization which represents 1,200 local television broadcasters in negotiations on music licensing fees with performance rights societies.
According to the Television Music License Committee press release on the court documents, SESAC had previously negotiated licenses for local television stations through the TML Committee, but in 2008 it decided to license broadcasters individually.
The complaint alleges that all stations are compelled to pay SESAC the price it demands for a license because they can't control what music is used in its programs and commercials.
Unlike ASCAP and BMI - which operate under voluntary consent decrees signed in 1941 and amended in 1950 after the U.S. Department of Justice sued ASCAP for violations of the Sherman Antitrust Act - SESAC is not subject to the consent decrees and can negotiate individual licenses, which the Committee believes results in fees that are in excess of what would be reasonable under an industry-wide license.
The complaint was filed in the U.S. Southern District Court of New York by Weil, Gotshal & Mangles LLP on behalf of Meridith Corp. Scripps Howard Broadcasting, Channel 7 of Detroit, Tampa Bay Television, Hoak Media of Nebraska and others.
For further information on the status of the local television complaint against SESAC, contact the Television Music License Committee (TMLC) website: