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U.S. Justice Department to Appeal Music Licensing Court Loss

November 11, 2016

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U.S. Attorney General Loretta Lynch.Photograph by Mark Wilson — Getty Images

The U.S. Justice Department will ask an appeals court to require music licensing company BMI to change how it collects royalties, the department said in a brief court filing on Friday.

The crux of the battle is over what kind of licenses Broadcast Music Inc., or BMI, can issue to digital streaming services, radio and television stations, bars and other music users.

BMI is fighting the Justice Department in court over the issue while the American Society of Composers, Authors and Publishers, or ASCAP, presses for legislative change.

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The Justice Department had said in August that it would require ASCAP and BMI to only issue “full-work” licenses. Requiring full-work licenses raised complications for some songs—no one knows how many—where songwriters did not agree to give each other joint ownership to the songs.

ASCAP and BMI have been issuing “fractional licenses” for songs if the organization does not represent all its composers.

A judge ruled in September that the Justice Department had gone too far in requiring only full-work licenses. The department notified the court on Friday that it planned to appeal to the U.S. Court of Appeals for the Second Circuit.

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BMI President Mike O’Neill said he had hoped there would not be an appeal.

“It is unfortunate that the DOJ continues to fight for an interpretation of BMI’s consent decree that is at odds with hundreds of thousands of songwriters and composers (and) the country’s two largest performing rights organizations,” O’Neill said in a statement.

ASCAP and BMI license about 90% of music heard online and in movies, TV shows and bars. ASCAP counts some 575,000 U.S. composers and songwriters among its members, while BMI has some 700,000 songwriters, composers and music publishers.