•  
  •  
 

Abstract

As emphasized by the European Commission Vice President for the Digital Single Market, “the way people enjoy culture and entertainment has completely changed- and this is good. But it is important that we don’t leave creators in the cold.” In response to pleas from songwriters, publishers and performing rights organizations (“PROs”) to allow free-market bargaining for public performance licenses of the PROs’ members’ musical compositions, the unanimously passed Orrin G. Hatch-Bob Goodlatte Music Modernization Act (“MMA”) was signed into law on October 11, 2018. Title I of the MMA, the Musical Works Modernization Act (“MWMA”), strives to alleviate several concerns regarding public performance licensing rates, while still upholding the near eighty-five-year-old consent decrees in which ASCAP and BMI operate under.

This Note first explores the parties that make up the predominant players to the music industry. Next, this Note will elaborate on the system in place for valuing and distributing licensing royalties to songwriters and other associated copyright owners for the public performance of any owned musical compositions, both prior to and after the MMA was enacted. It will then explain, in detail, the responsibilities of judges in reasonable rate-setting determinations. Finally, it will critique the effect that bargaining in the shadow of rate-setting proceedings has on predictability of outcomes and private negotiations, a controversial topic that became the subject of the MWMA amendment.

While predictability is often sought after for purposes of conformity and consistency, this Note concludes that the amendment to random judicial assignment will create more unpredictability in how and what rates will be determined, which is ultimately, a positive outcome. Furthermore, this Note concludes that increasing unpredictability encourages private negotiations amongst parties, negotiations that are more likely to result in an agreement that resembles free market agreements than court determined rates. Unpredictability in the judicial process encourages parties to work together, rather than be adversarial, and helps keep arrangements out of judges’ hands who are not properly equipped to be determining rates. Finally, this Note will propose possible solutions to anticompetitive practices amongst the PROs and judicial assignment if the random judicial assignment amendment fails to reach its intended goal.

Share

COinS