ASCAP settles with U.S. over music licensing

Thu May 12, 2016 5:11pm EDT
 
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By Diane Bartz

WASHINGTON (Reuters) - The American Society of Composers, Authors and Publishers, better known as the music licensing firm ASCAP, agreed to pay $1.75 million to settle a Justice Department charge that it blocked members from independently licensing their songs, the department said on Thursday.

ASCAP said that the settlement would allow it to press on with talks with the department over how to amend a decades-old consent decree that governs how songwriters are paid.

Under the settlement, ASCAP will pay $1.75 million for entering into some 150 exclusive contracts with songwriters and others even though a court order barred ASCAP from blocking them from directly licensing their own music.

"With these issues resolved, we continue our focus on leading the way towards a more efficient, effective and transparent music licensing system and advocating for key reforms to the laws that govern music creator compensation," said ASCAP CEO Elizabeth Matthews in a statement.

ASCAP and Broadcast Music Inc (BMI), which license about 90 percent of music heard on online services and in movies and restaurants, have been pressing the Justice Department to change or scrap agreements it reached with them in 1941 in order to take into account changes that have come with the rise of music streaming services like Pandora Media Inc.

ASCAP represents artists like Beyonce, Billy Joel, Katy Perry and Hans Zimmer.

Currently, any dispute over the cost of a license goes to "rate courts," which were established by 1941 consent decrees and are based in the U.S. District Court for the Southern District of New York.

ASCAP collected more than $1 billion in 2015, and distributed $870 million to its members.

(Reporting by Diane Bartz; Editing by Sandra Maler)