DOJ Ruling on 100% Licensing Denies Due Process to Songwriters
In case you’re trying to figure out what in the world the Department of Justice is thinking with its recent ruling on 100% licensing for PROs, maybe a page of history is worth a volume of logic.
In a nutshell, there is a doctrine of U.S. copyright law that permits a co-owner of an undivided interest in property, such as a song, either owner can grant a nonexclusive license in the whole subject to a duty to account.
While this concept exists at copyright law in the U.S., it is disfavored and has never been the business practice. It has also never been the practice at the PROs anywhere in the world, including the government regulated U.S. PROS ASCAP and BMI.
Seemingly out of the blue, the U.S. Department of Justice in the form of Deputy Assistant Attorney General Renata B. Hesse got interested in applying this rule to ASCAP and BMI. When did they do that?
What happened right before September 22, 2015? The MIC Coalition, which is Google, Pandora and a bunch of other companies and lobby shops representing companies with a combined market cap over $2 trillion called on the U.S. Attorney General and Ms. Hesse to regulate SESAC. (See letter above.)
That letter, dated August 17, 2015 presented an opportunity for the Googlecentric–if the regulated PROs could be forced to accept 100% licensing, then with the stroke of a pen, the Department of Justice could drag SESAC writers under the governments boot if they co-wrote with ASCAP or BMI writers.
All without that pesky due process business.
And Uncle Sugar (aka Google Executive Chairman Eric Schmidt) would be sooo happy.