Antitrust Lawsuit Withdrawn Against SESAC

Nashville-headquartered SESAC has settled an antitrust lawsuit from the Radio Music Licensing Committee (RMLC), for the first time subjecting itself to arbitration over the royalty rates it sets.

Unlike larger PROs BMI and ASCAP, the privately owned licensing company is not subject to regulatory agreements with the federal government over its licensing processes.

The settlement, announced by both parties Thursday (July 23) will extend for 22 years, maintaining license fees for commercial radio stations until 2016, when they will begin to be subject to further negotiated agreements. Final arbitration will be conducted in early 2017 and happen throughout the duration of the agreement.

SESAC will pay no damages outside of reimbursing approximately $3.5 million in legal expenses. 

Thousands of stations joined the RMLC, suing SESAC over “anticompetitive practices in how that group licenses music” with accusations of being “a cartel that has illegally monopolized an essential repertory of copyrighted music.”

According to a statement from SESAC, the settlement will allow its management to pursue the company’s previously announced strategy under its new leadership team of a simplified and more efficient, multi-right, multi-territory licensing model utilizing an ongoing focus on information technology and data science to meet the developing needs of music users, distributors, writers, composers, publishers and other stakeholders.

In July, SESAC announced that it was poised to acquire the Harry Fox Agency from the National Music Publishers’ Association for upwards of $20 million. The deal allows SESAC to become the only U.S. rights organization with the ability to offer singular licenses for the works of its affiliated writers and publishers, aggregating both performance and mechanical rights.

In October, SECAC agreed to pay $58.5 million to television stations as part of a settlement in a separate antitrust case, according to the New York Times, also subjecting it to arbitration if negotiations are unsuccessful.