2nd U.S. Circuit Court of Appeals Rules In Favor Of Pandora

The 2nd U.S. Circuit Court of Appeals has affirmed the March 19, 2014 rulings in performing rights organization ASCAP’s case against Pandora, rejecting efforts by ASCAP and music publishers that would force the internet radio company to pay higher royalties and have access to fewer songs.

The appeals court rejected ASCAP’s effort to increase the rate that Pandora must pay to license its music from 2013 to 2015, thus upholding two rulings from U.S. District Judge Denise Cote (Manhattan). The first ruling required Pandora to pay ASCAP a royalty rate of 1.85 percent of revenue for use of its songs from 2011-2015. ASCAP has proposed an escalating rate that capped at three percent.

The second ruling rejected efforts by Vivendi SA’s Universal Music Publishing, as well as Sony/ATV Music Publishing and EMI Music Publishing, to withdraw their new media licensing rights from ASCAP.

“This ruling reaffirms what we already know – that the ASCAP Consent Decree and the rules that govern music licensing are outdated and completely out of step with the way people listen to music today,” said ASCAP CEO Elizabeth Matthews of the ruling. “We are encouraged that the Department of Justice is reviewing the ASCAP Consent Decree and by the growing chorus of voices in support of our efforts to modernize music licensing – from the Copyright Office to Congressional sponsors of the Songwriter Equity Act. Powerful corporate interests, like Pandora, are determined to stand in the way of meaningful music licensing reform so that they may continue to shortchange songwriters. This is a wake up call for creators to stand together, get involved and fight for their right to be paid a fair market rate for the use of their works.”