Azoff’s GMR Fights Back

The performance rights organization backed by Irving Azoff has gone on the offensive against a nonprofit representing 10,000 commercial radio stations, hitting it with an antitrust suit and accusing the stations of operating as a conspiratorial “cartel.”  

The Radio Music License Committee made the first move earlier this month when it filed suit in the U.S. District Court for the Eastern District of Pennsylvania against Azoff’s Global Music Rights.

The suit accused GMR of charging exorbitant rates for the works of the artists and songwriters it represented. Rather than file a countersuit, GMR contracted the services of heavyweight lawyer Daniel Petrocelli and filed its own antitrust suit in federal court Dec. 6. GMR claims the radio stations are operating as a “cartel” and have an immoral arrangement to collectively keep costs low on songs that they should be competing for.

GMR argues that this agreement between radio stations results in unfair compensation for songwriters and less music for audiences. The company is suing the RMLC for antitrust damages and seeks an injunction to keep the radio stations from collaborating on low price-setting. Most music is licensed to BMI or ASCAP, which are regulated by antitrust consent decrees controlling the amount those organizations can charge to license a song. In recent years, though, smaller for-profit PROs have sprung up, which are not subject to the same regulations.

Two such organizations of note are GMR and SESAC. The RMLC recently won a suit with SESAC for $3.5 million in legal costs and the small PRO agreed it would change its rate practices and subject itself to regulation. The nonprofit then set its sights on GMR. The results of this dispute could have significant ramifications for the future of music licensing.

“This is the most important fight of my professional life,” Azoff said in a statement. “I will not stop the fight for fairness to artists and songwriters.”

A decisive factor could be the participation of Petrocelli, who is currently defending Sirius XM in a class action suit filed by members of The Turtles against the satellite radio company for playing songs without permission. Those parties recently reached a settlement for up to $99 million, which is pending approval in U.S. District Court in California.