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The MTP Podcast: The Truth About Streaming Royalties

January 30, 2019 Comments off

The MTP Podcast: When is a Pledge Not a Pledge? The PledgeMusic crisis

January 25, 2019 Comments off

 

Chris Castle discusses the current crisis with PledgeMusic payments.

SHOW NOTES

PledgeMusic: Once a Crowdfunding Haven For Artists, Now Owes them Thousands of Dollars–Billboard www.billboard.com/articles/busines…ds-late-payments

Digital Aggregator Deals: Is the New Boss Worse Then the Old Boss?

musictechpolicy.com/2012/02/01/read…n-the-old-boss/

What is the Difference Between Dischargeable and Nondischargeable Debts in Bankruptcy? 

www.nolo.com/legal-encyclopedia…ts-bankruptcy.html

Which Debts are Discharged in Chapter 7 Bankruptcy?

www.nolo.com/legal-encyclopedia…-7-bankruptcy.html

Chapter 11 Bankruptcy for Small Business

www.thebankruptcysite.org/resources/ba…sinesses.htm

Secured vs. Unsecured Debt in Chapter 7 Bankruptcy

www.thebankruptcysite.org/resources/ba…7-bankruptcy

Bankruptcy in the UK

www.gov.uk/bankruptcy

Civil Investigative Demands

www.law.cornell.edu/uscode/text/31/3733

MTP Podcast: Spotify’s Direct Public Offering

January 10, 2019 Comments off

 

Chris Castle explains Spotify’s direct public offering (compared to a traditional IPO) and commentary on how the stock is performing (NOT investment advice).

According to the Spotify Case Study:

As of March 28, 2018, the average first-day return for 2018 IPOs was 13.2%. [4] On April 3, 2018, when Spotify opened for trading on the NYSE, the NYSE’s initial reference price that was published to the market pre-trading was US$132.00 per share the opening price of the shares was US$165.90 per share, or approximately 25.7% higher than the NYSE reference price. Trading in Spotify’s shares closed at a price of US$149.01 per share, which was approximately 10.2% below the opening price and 12.9% above the reference price….Spotify disclosed recent high and low sales prices per share in recent private transactions on the cover page of the preliminary prospectus and the final prospectus [to arrive at the reference price of $132].

Spotify Buyback

Spotify Case Study: Structuring and Executing a Direct Listing 

MusicTech Solutions: Why Will Spotify’s Price Tank?

Barrons: Spotify Stock Is Up This Year, but Analysts Say Don’t Get Too Excited

Spotify stock, up almost 6% this year, have dropped about 27% in the last 3 months, more than twice as far as theS&P 500’s decline.

On Monday, Stifel’s John Egbert reiterated a Buy rating on the stock, while lowering his target price to $170 from $210. That’s in part based on his estimate of the fair value of its stake inTencent Music Entertainment (TME). But he also trimmed some margin estimates based on the likely costs of global expansion.

“We remain bullish on Spotify’s subscriber growth prospects and believe the company could deliver upside to our 2019 subscriber addition forecast of 24 million, particularly if newly (and soon-to-be) launched markets become material,” Egbert wrote.

Deutsche Bank ’s Lloyd Walmsley maintained a Hold rating on the shares, cutting his price target to $135 from $152 in a Sunday note. Nomura Instinet’s Mark Kelley, meanwhile, wrote Sunday that Spotify was “among the most oversold stocks in our coverage.”

Spotify SEC Ruling on Reference Price for SPOT shares

ALI’s Restatement of Copyright Scandal

January 7, 2019 Comments off

Shownotes for Restatement Scandal:

Justice Scalia provides us with an explanation of what the “modern Restatement” is (Kansas v. Nebraska, 574 U.S. ____ (2015) (Scalia, J. concurring in part, dissenting in part):

I write separately to note that modern Restatements—such as the Restatement [at issue in the case at bar]—are of questionable value, and must be used with caution. The object of the original Restatements was “to present an orderly statement of the general common law.” Restatement of Conflict of Laws, Introduction, p. viii (1934). Over time, the Restatements’ authors have abandoned the mission of describing the law, and have chosen instead to set forth their aspirations for what the law ought to be….And it cannot safely be assumed, without further inquiry, that a Restatement provision describes rather than revises current law.

ali status copyright restatement

ALI Restatement of Copyright Progress Status (note no chapters have been approved)

American Law Institute, Restatement of Copyright project

Restatement of Copyright Participants

Samuelson Letter to ALI Requesting Restatement of Copyright

Spotify Lawyer Leads Law Institute “Restatement of Copyright” Project www.hypebot.com/hypebot/2018/01/s…ake-treatise.html]

Above the Law:  ALI’s Great Copyright Caper: Has The American Law Institute Been Hijacked By Big Tech?

Introducing Christopher Sprigman

Sprigman Pro Hac Vice in Spotify case

sprigman google academics

 

Weekly Key Dates and Accomplishments for the Mechanical Licensing Collective Under the Music Modernization Act (11/30) by Artist Rights Watch (The “Countdown to Modernity”)

December 2, 2018 Comments off

As best we can tell from the outside looking in, this chart has the dates for key events in the critical path to launch for the Mechanical Licensing Collective as required by the Music Modernization Act.  We have called the chart the “Countdown to Modernity.”  Obviously, this chart is not intended as legal advice, and you should consult your own attorney about any of these dates or events.  Note:  After 1/9/19, this chart, updates and analysis will be available to premium subscribers of MusicTechPolicy.

Recall that the Register of Copyrights gets to pick the entity to operate as the Mechanical Licensing Collective. The Tennessean reported that the first fully-formed candidate to emerge is the American Music Licensing Collective or the “AMLC”.  (AMLC’s website is songrights.net.)  Within days, Digital Music News also reported that two AMLC board members have left the organization for reasons that their source says were “directly tied to threats”.  Digital Music News continues to report on these alleged “threats.”

The appearance of multiple candidates for the yet to be designated MLC raises another question–what about any existing black box?  MTP and ARW readers will recall that the MLC is allowed to invade the black box to cover certain administrative costs that exceed the “administrative assessment” to be paid by the blanket licensees:

INTERIM APPLICATION OF ACCRUED ROYALTIES.—In the event that the administrative assessment, together with any funding from voluntary contributions…is inadequate to cover current collective total costs, the collective, with approval of its board of directors, may apply unclaimed accrued royalties on an interim basis to defray such costs, subject to future reimbursement of such royalties from future collections of the assessment.

Digital Music News also focuses on this issue:

According to the MMA’s language, mechanical licenses [presumably meaning royalties] that remain unclaimed after just one year will be largely mopped up by major publishers according to marketshare, an arrangement that has drawn protest.  The value of the initial unclaimed tranche of funds has been estimated to be as high as $1.5 billion, at least according to a report by Variety.

We’re not big believers in this $1.5 billion number and it’s not exactly right that Variety reported that number–the Variety story has changed several times and is still a bit murky.   Due to a later update to the article concerned it’s a bit unclear exactly what Variety meant in the original unsourced reporting.  The original story as reported in Artist Rights Watch stated the industry-wide black box was $1.5 billion:

The DSPs are holding some $1.5 billion in unmatched mechanical royalties. If the MMA passes, that money would be passed through to the MLC which would match it to the songwriters and publishers.

Variety subsequently changed that language in the story at least twice that we know of, but never actually retracted the $1.5 billion number as far as we can tell, although they may have depending on your point of view of what constitutes a “retraction”.  In any event, the story now reads:

The DSPs are holding millions in unmatched mechanical royalties — the sum of all Notice of Intent (NOI) filings currently parked at the U.S. Copyright office, while unknown, is climbing. If the MMA passes, that money would be passed through to the MLC which would match it to the songwriters and publishers.

Note–there’s still no source for either the “$1.5 billion” or the “millions” or for the “update”.  Remember that in the MMA Senate Judiciary Committee hearing, Senator Feinstein said that the black box could be hundreds of millions.

Remember that the “initial administrative assessment shall be effective as of the license availability date” which is 1/1/21.  It is not clear whether the initial administrative assessment will cover the MLC’s prospective costs, its startup costs, or both.  One fair interpretation of the MMA is that the initial assessment shall be prospective and shall not cover startup costs, although the parties can, of course, agree to pay more than they are obligated to incur by statute.  It is unclear if those additional costs would be passed down to all blanket licensees (who may object to paying more than the statute requires).  You would think that this important issue would be clearly stated in the statute, but it is not.

The following chart is a work in progress, and if anyone sees anything wrong in it or something that should be clarified or corrected, please let us know.  It should be considered a draft, but we hope that it will solidify over the next few weeks.  We expect activity to pick up once the MLC filing deadline arrives.

Due to the formation of the AMLC, there are now two candidates for the MLC, there may be more coming.  The COUNTDOWN TO MODERNITY chart needs to distinguish AMLC from the competing NMPA/NSAI MLC which does not have a name as far as we know.  Until the NMPA/NSAI collective adopts a name, we will refer to it as the NMPA/NSAI collective.

The main takeaway from this chart should be the clock is ticking and time is going by.  Our prediction?  Time will become the MLC’s biggest enemy, if there isn’t already a time bomb in the drafting of the Music Modernization Act.  What we don’t see in the MMA is any discussion of what happens if a deadline is blown for whatever reason.

But mark your calendars–we see the first key date as January 9, 2019 when the Copyright Office will request filings from MLC candidates, which so far include the AMLC and the collective to be formed by NMPA/NSAI.  That’s 38 days from now and holidays count.  The countdown to the License Availability Date: 761 days from now.

ARTIST RIGHTS WATCH
COUNTDOWN TO MECHANICAL LICENSING COLLECTIVE LAUNCH
WEEK 7

KEY DATES SCHEDULE FROM ENACTMENT DATE (10/11/18)

TO LICENSE AVAILABILITY DATE (1/1/21)

EVENT ACCOMPLISH WHO OWNS? TIME EXPIRED   BEFORE LAD TIME REMAINS TO LAD
REQUEST FILING TO BE MLC STATUS UNKNOWN—Deadline  1/9/2019 COPYRIGHT OFFICE 90 DAYS AFTER ENACTMENT 723 DAYS FROM DEADLINE
DESIGNATION OF MLC STATUS UNKNOWN—Deadline  7/8/2019 COPYRIGHT OFFICE 270 DAYS AFTER ENACTMENT 543 DAYS FROM DEADLINE
FORMATION OF MLC NONPROFIT AMLC nonprofit formed

NMPA/NSAI STATUS UNKNOWN

MLC STATUS UNKNOWN 543 DAYS FROM LAD
SUBSTITUTION OF BLANKET LICENSE FOR ALL VALID EXISTING COMPULSORY LICENSES AUTOMATIC 10/11/2018

 

COPYRIGHT OFFICE 761 days
MLC BUDGET STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/DLC/CRJ 45 days 770 days
INITIATE ASSESSMENT PROCEEDING w/CRJs [MUST COMMENCE NO LATER THAN 7/8/2019]

STATUS UNKNOWN

MLC/DLC/CRJ 219 days 545 days
ASSESSMENT RULING [PUBLISHED IN FR NO LATER THAN 7/8/2020] MLC/DLC/
CRJs
585 days 179 days
APPEAL OF ASSESSMENT RULING 30 DAYS AFTER PUBLICATION OF ASSESSMENT RULING MLC/DLC/
CRJ/ DCCOA
616 days 149 days
MLC BUSINESS PLAN STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/CO 39 DAYS 723 days
ANNOUNCED BOARD NOMINEES AMLC board announced (see DMN and above)

NMPA/NSAI called for nominations.

The deadline for NMPA nominations passed on November 15  see NMPA.  NSAI are accepting nominations for songwriter board member seats with a December 15 deadline.  (these are nonstatutory deadlines) Songwriter board selection by Steve Bogard (NSAI), Rick Carnes (SGA), Lynn Gillespie Chater (SGA), Dallas Davidson (BMI), Chris DeStefano (NSAI), Bob DiPiero (BMI), Dan Foliart (ASCAP), Adam Gorgoni (SONA), Michele Lewis (SONA), Paul Williams (ASCAP)

(Assume final deadline of 1/8/19)

MLC 39 DAYS 723 days
APPOINTED BOARD AMLC Board Announced (DMN reports Howard and Mestel depart):

John Barker (founder, president & CEO of ClearBox Rights, LLC).

Brownlee Ferguson (founder, Bluewater Music).

George Howard (co-founder of both Music Audience Exchange and TuneCore and CIO of Riptide Publishing).

Lisa Klein Moberly (founder and president of Optic Noise).

Benji Rogers (singer-songwriter, founder of PledgeMusic and co-founder of dotBlockchain Media)

Jeff Price (founder of Audiam and co-founder of TuneCore)

Henry Gradstein (music industry attorney at Gradstein & Marzano, P.C.)

Larry Mestel (founder, Primary Wave)

Ricardo Ordoñez (founder and president of Union Music Group)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/CO 39 DAYS 723 days
APPOINTED DLC STATUS UNKNOWN—Deadline  7/8/2019 COPYRIGHT OFFICE 270 days AFTER ENACTMENT 545 days
ENGAGED  MLC VENDORS AMLC:  Clearbox Rights, Audiam (others?)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC 39 DAYS 723 days
PAID MLC VENDORS AMLC: See board members above

NMPA/NSAI: STATUS UNKNOWN (ASSUME 7/8/2020 IF NO APPEAL OF ASSESSMENT)

MLC 270 days 545 days
ANNOUNCE MLC DATA STANDARDS STATUS UNKNOWN MLC/DLC
REGULATIONS* STATUS UNKNOWN COPYRIGHT OFFICE
COMMENTS AND REPLY COMMENTS ON REGULATIONS STATUS UNKNOWN ALL
EXPLANATION OF OPERATIONS: HOW TO REGISTER WITH MLC AND COST OF REGISTRATION STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/CO 39 DAYS 726 days
REGISTRATION START DATE STATUS UNKNOWN

 

MLC=Mechanical Licensing Collective

DLC=Digital Licensee Coordinator

CRJ=Copyright Royalty Judges

DCCOA=District of Columbia Circuit Court of Appeals

CO=Copyright Office

LAD=License Availability Date

*Topic areas to be updated as announced

Artist Rights Watch COUNTDOWN TO MODERNITY (11/23): Key Dates and Accomplishments for the Mechanical Licensing Collective Under the Music Modernization Act

November 23, 2018 Comments off

As best we can tell from the outside looking in, this chart has the dates for key events in the critical path to launch for the Mechanical Licensing Collective as required by the Music Modernization Act.  We have called the chart the “Countdown to Modernity.”

Recall that the Register of Copyrights gets to pick the entity to operate as the Mechanical Licensing Collective. The Tennessean reported last week that the first fully-formed candidate to emerge is the American Music Licensing Collective or the “AMLC”.  (AMLC’s website is songrights.net.)  Digital Music New reports AMLC’s public statements about its organization:

“We believe all song owners, from the kid in their bedroom, to the major music publishers, should be paid what they have earned,” the group declares in its manifesto.

“We are songwriters, artists, music publishers, musicians, composers and technologists.  We get song owners paid.”

So who’s behind the American Music Licensing Collective, exactly?

We’ll start with one of the founders: Stewart Copeland, best known as the drummer for The Police.  Also on the creative side is hit songwriter Rick Carnes, whose songs have propelled more than 40 platinum albums from the likes of Garth Brooks, Reba McEntire, Alabama, Pam Tillis, and Dean Martin.

Other founding members include:

  • John Barker (founder, president & CEO of ClearBox Rights, LLC).
  • Brownlee Ferguson (founder, Bluewater Music).
  • George Howard (co-founder of both Music Audience Exchange and TuneCore and CIO of Riptide Publishing).
  • Lisa Klein Moberly (founder and president of Optic Noise).
  • Benji Rogers (singer-songwriter, founder of PledgeMusic and co-founder of dotBlockchain Media)
  • Jeff Price (founder of Audiam and co-founder of TuneCore)
  • Henry Gradstein (music industry attorney at Gradstein & Marzano, P.C.)
  • Larry Mestel (founder, Primary Wave)
  • Ricardo Ordoñez (founder and president of Union Music Group)

Listed as ‘observers’ are Grammy-nominated songwriter and producer Phil Galdston, and Grammy- and Emmy-nominated songwriter and producer David Wolfert.

“The board of directors of the AMLC have a profound and extensive knowledge of music publishing, mechanical license administration, big data, mapping and matching technology, payment processing, copyright ownership identification, conflict resolution, education, law, songwriting, architecture of technology systems and more,” the group notes.

Within days, Digital Music News also reported that two AMLC board members have left the organization for reasons that their source says were “directly tied to threats”:

Separately, a source close to the AMLC claimed that the departures were directly tied to threats by major publishers, with the National Music Publishers’ Association (NMPA) and at least one highly-influential publishing executive cited….AMLC cofounder Jeff Price confirmed to DMN that threats had been issued, but declined to name names.  Price, who cofounded TuneCore and more recently founded Audiam, remains a board member of the AMLC but noted that he has “received threats that I recuse myself from the board or suffer repercussions to my career.”

Beyond that, Price was uncertain if other board members had received similar threats, but strongly suggested the possibility.  “If there is a coordinated effort, and a colluded [sic] or orchestrated effort occurring to remove people from the AMLC, the question is why?”

“Is there something with the core mission statement they want to change? Otherwise what could it possibly be?”

The appearance of multiple candidates for the yet to be designated MLC raises another question–what about any existing black box?  MTP and ARW readers will recall that the MLC is allowed to invade the black box to cover certain administrative costs:

INTERIM APPLICATION OF ACCRUED ROYALTIES.—In the event that the administrative assessment, together with any funding from voluntary contributions…is inadequate to cover current collective total costs, the collective, with approval of its board of directors, may apply unclaimed accrued royalties on an interim basis to defray such costs, subject to future reimbursement of such royalties from future collections of the assessment.

Digital Music News also focuses on this issue:

According to the MMA’s language, mechanical licenses that remain unclaimed after just one year will be largely mopped up by major publishers according to marketshare, an arrangement that has drawn protest.  The value of the initial unclaimed tranche of funds has been estimated to be as high as $1.5 billion, at least according to a report by Variety.

We’re not big believers in this $1.5 billion number and it’s not exactly right that Variety reported that number–the Variety story has changed several times and is still a bit murky.   Due to a later update to the article concerned it’s a bit unclear exactly what Variety meant in the original unsourced reporting.  The original story as reported in Artist Rights Watch stated the industry-wide black box was $1.5 billion:

The DSPs are holding some $1.5 billion in unmatched mechanical royalties. If the MMA passes, that money would be passed through to the MLC which would match it to the songwriters and publishers.

Variety subsequently changed that language in the story at least twice that we know of, but never actually retracted the $1.5 billion number as far as we can tell, although they may have depending on your point of view of what constitutes a “retraction”.  In any event, the story now reads:

The DSPs are holding millions in unmatched mechanical royalties — the sum of all Notice of Intent (NOI) filings currently parked at the U.S. Copyright office, while unknown, is climbing. If the MMA passes, that money would be passed through to the MLC which would match it to the songwriters and publishers.

Note–there’s still no source for either the “$1.5 billion” or the “millions” or for the “update”.

Soooo…

If there’s only one MLC when the deadline passes to file papers for Copyright Office designation, then any accrued but unpaid black box–whatever the number–could be paid through to the MLC, even before it’s really up and running with a completely stood up database for matching.  It’s also theoretically possible–although very unlikely and not proven by any means–that the black box could have been paid through already in anticipation of there being only one MLC candidate.

Of course, if there’s more than one candidate, then any payment of black box for the past should be put on hold until the candidate is actually designated, particularly since the government took away copyright owners’ rights to statutory damages and attorneys fees if the copyright owner hasn’t filed their lawsuit as of January 1, 2018.  (Black box accrual = unlicensed infringing use = admission of infringement.)

Soooo….you just gotta love you some MMA.

The following chart is a work in progress, and if anyone sees anything wrong in it or something that should be clarified or corrected, please let us know.  It should be considered a draft, but we hope that it will solidify over the next few weeks.  We expect activity to pick up once the MLC filing deadline arrives.

Due to the formation of the AMLC, there are now two candidates for the MLC, there may be more coming.  The COUNTDOWN TO MODERNITY chart needs to distinguish AMLC from the competing NMPA/NSAI MLC which does not have a name as far as we know.  Until the NMPA/NSAI collective adopts a name, we will refer to it as the NMPA/NSAI collective.

The main takeaway from this chart should be the clock is ticking and time is going by.  Our prediction?  Time will become the MLC’s biggest enemy, if there isn’t already a time bomb in the drafting of the Music Modernization Act.  What we don’t see in the MMA is any discussion of what happens if a deadline is blown for whatever reason.

But mark your calendars–we see the first key date as January 7, 2019 when the Copyright Office will request filings from MLC candidates, which so far include the AMLC and the collective to be formed by NMPA/NSAI.  That’s 45 days from now and holidays count.  The countdown to the License Availability Date: 770 days from now.

ARTIST RIGHTS WATCH
COUNTDOWN TO MECHANICAL LICENSING COLLECTIVE LAUNCH
WEEK 6

KEY DATES SCHEDULE FROM ENACTMENT DATE (10/11/18)

TO LICENSE AVAILABILITY DATE (1/1/21)

EVENT ACCCOMPLISHED WHO OWNS? TIME EXPIRED   BEFORE LAD TIME REMAINS TO LAD
REQUEST FILING TO BE MLC STATUS UNKNOWN—Deadline  1/9/2019 COPYRIGHT OFFICE 90 DAYS AFTER ENACTMENT 726 DAYS FROM DEADLINE
DESIGNATION OF MLC STATUS UNKNOWN—Deadline  7/8/2019 COPYRIGHT OFFICE 270 DAYS AFTER ENACTMENT 545 DAYS FROM DEADLINE
FORMATION OF MLC NONPROFIT AMLC nonprofit formed

NMPA/NSAI STATUS UNKNOWN

MLC 45 days 726 days
SUBSTITUTION OF BLANKET LICENSE FOR ALL EXISTING COMPULSORY LICENSES AUTOMATIC 10/11/2018

 

COPYRIGHT OFFICE 770 days
MLC BUDGET STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/DLC/CRJ 45 days 770 days
INITIATE ASSESSMENT PROCEEDING w/CRJs [MUST COMMENCE NO LATER THAN 7/8/2019]

STATUS UNKNOWN

MLC/DLC/CRJ 226 days 545 days
ASSESSMENT RULING [PUBLISHED IN FR NO LATER THAN 7/8/2020] MLC/DLC/CRJ 592 days 179 days
APPEAL OF ASSESSMENT RULING 30 DAYS AFTER PUBLICATION OF ASSESSMENT RULING MLC/DLC/CRJ/ DCCOA 623 days 149 days
MLC BUSINESS PLAN STATUS UNKNOWN

(Assume deadline of 1/8/19)

MLC/CO 45 DAYS 726 days
ANNOUNCED BOARD NOMINEES AMLC board announced (see DMN and above)

NMPA/NSAI called for nominations.

The deadline for NMPA nominations passed on November 15  see NMPA.  NSAI are accepting nominations for songwriter board member seats with a December 15 deadline.  (these are nonstatutory deadlines) Songwriter board selection by Steve Bogard (NSAI), Rick Carnes (SGA), Lynn Gillespie Chater (SGA), Dallas Davidson (BMI), Chris DeStefano (NSAI), Bob DiPiero (BMI), Dan Foliart (ASCAP), Adam Gorgoni (SONA), Michele Lewis (SONA), Paul Williams (ASCAP)

(Assume final deadline of 1/8/19)

MLC 45 DAYS 726 days
APPOINTED BOARD AMLC Board Announced (DMN reports Howard and Mestel depart):

John Barker (founder, president & CEO of ClearBox Rights, LLC).

Brownlee Ferguson (founder, Bluewater Music).

George Howard (co-founder of both Music Audience Exchange and TuneCore and CIO of Riptide Publishing).

Lisa Klein Moberly (founder and president of Optic Noise).

Benji Rogers (singer-songwriter, founder of PledgeMusic and co-founder of dotBlockchain Media)

Jeff Price (founder of Audiam and co-founder of TuneCore)

Henry Gradstein (music industry attorney at Gradstein & Marzano, P.C.)

Larry Mestel (founder, Primary Wave)

Ricardo Ordoñez (founder and president of Union Music Group)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/CO 45 DAYS 726 days
APPOINTED DLC STATUS UNKNOWN—Deadline  7/8/2019 COPYRIGHT OFFICE 270 days AFTER ENACTMENT 545 days
ENGAGED  MLC VENDORS AMLC:  Clearbox Rights, Audiam (others?)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC 90 DAYS 726 days
PAID MLC VENDORS AMLC: See board members above

NMPA/NSAI: STATUS UNKNOWN (ASSUME 7/8/2020 IF NO APPEAL OF ASSESSMENT)

MLC 270 days 545 days
ANNOUNCE MLC DATA STANDARDS STATUS UNKNOWN MLC/DLC
REGULATIONS* STATUS UNKNOWN COPYRIGHT OFFICE
COMMENTS AND REPLY COMMENTS ON REGULATIONS STATUS UNKNOWN ALL
EXPLANATION OF OPERATIONS: HOW TO REGISTER WITH MLC AND COST OF REGISTRATION STATUS UNKNOWN

(Assume deadline of 1/9/19)

MLC/CO 90 DAYS 726 days
REGISTRATION START DATE STATUS UNKNOWN

 

MLC=Mechanical Licensing Collective

DLC=Digital Licensee Coordinator

CRJ=Copyright Royalty Judges

DCCOA=District of Columbia Circuit Court of Appeals

CO=Copyright Office

LAD=License Availability Date

*Topic areas to be updated as announced

Artist Rights Watch COUNTDOWN TO MODERNITY (11/16): Key Dates and Accomplishments for the Mechanical Licensing Collective Under the Music Modernization Act

November 16, 2018 Comments off

As best we can tell from the outside looking in, this chart has the dates for key events in the critical path to launch for the Mechanical Licensing Collective as required by the Music Modernization Act.  We have called the chart the “Countdown to Modernity.”

UPDATE:  Recall that the Register of Copyrights gets to pick the entity to operate as the Mechanical Licensing Collective.  According to Digital Music News, the first fully-formed candidate to emerge is the American Music Licensing Collective or the “AMLC”.  (AMLC’s website is songrights.net.)  Digital Music New reports AMLC’s public statements about its organization:

“We believe all song owners, from the kid in their bedroom, to the major music publishers, should be paid what they have earned,” the group declares in its manifesto.

“We are songwriters, artists, music publishers, musicians, composers and technologists.  We get song owners paid.”

So who’s behind the American Music Licensing Collective, exactly?

We’ll start with one of the founders: Stewart Copeland, best known as the drummer for The Police.  Also on the creative side is hit songwriter Rick Carnes, whose songs have propelled more than 40 platinum albums from the likes of Garth Brooks, Reba McEntire, Alabama, Pam Tillis, and Dean Martin.

Other founding members include:

  • John Barker (founder, president & CEO of ClearBox Rights, LLC).
  • Brownlee Ferguson (founder, Bluewater Music).
  • George Howard (co-founder of both Music Audience Exchange and TuneCore and CIO of Riptide Publishing).
  • Lisa Klein Moberly (founder and president of Optic Noise).
  • Benji Rogers (singer-songwriter, founder of PledgeMusic and co-founder of dotBlockchain Media)
  • Jeff Price (founder of Audiam and co-founder of TuneCore)
  • Henry Gradstein (music industry attorney at Gradstein & Marzano, P.C.)
  • Larry Mestel (founder, Primary Wave)
  • Ricardo Ordoñez (founder and president of Union Music Group)

Listed as ‘observers’ are Grammy-nominated songwriter and producer Phil Galdston, and Grammy- and Emmy-nominated songwriter and producer David Wolfert.

“The board of directors of the AMLC have a profound and extensive knowledge of music publishing, mechanical license administration, big data, mapping and matching technology, payment processing, copyright ownership identification, conflict resolution, education, law, songwriting, architecture of technology systems and more,” the group notes.

This chart is a work in progress, and if anyone sees anything wrong in it or something that should be clarified or corrected, please let us know.  It should be considered a draft, but we hope that it will solidify over the next few weeks.

Due to the formation of the AMLC, there are now two candidates for the MLC.  The COUNTDOWN TO MODERNITY chart needs to distinguish AMLC from the competing NMPA/NSAI MLC which does not have a name as far as we know.  Until the NMPA/NSAI collective adopts a name, we will refer to it as the NMPA/NSAI collective.

UPDATE:  Black Box Invasion!  MTP readers will recall that the MLC is allowed to invade the black box to cover certain administrative costs:

INTERIM APPLICATION OF ACCRUED ROYALTIES.—In the event that the administrative assessment, together with any funding from voluntary contributions…is inadequate to cover current collective total costs, the collective, with approval of its board of directors, may apply unclaimed accrued royalties on an interim basis to defray such costs, subject to future reimbursement of such royalties from future collections of the assessment.

The “black box” may have already begun accruing at all of the services, although the accrual will no doubt vary from one service to another.  However, what should be clear is that since there are now two candidates for the MLC, neither should be able to tap the black box prior to final designation of the MLC by the Copyright Office or otherwise.

The main takeaway from this chart should be the clock is ticking and time is going by.  Our prediction?  Time will become the MLC’s biggest enemy, if that hasn’t already happened in the drafting of the Music Modernization Act.  What we don’t see in the MMA is any discussion of what happens if a deadline is blown for whatever reason.

But mark your calendars–we see the first key date as January 7, 2019 when the Copyright Office will request filings from MLC candidates, which so far include the AMLC and the collective to be formed by NMPA/NSAI.  That’s 52 days from now and holidays count.  The countdown to the License Availability Date: 777.

ARTIST RIGHTS WATCH
COUNTDOWN TO MECHANICAL LICENSING COLLECTIVE LAUNCH
WEEK 5

KEY DATES SCHEDULE FROM ENACTMENT DATE (10/11/18)

TO LICENSE AVAILABILITY DATE (1/1/21)

EVENT ACCCOMPLISHED WHO OWNS? TIME EXPIRED   BEFORE LAD TIME REMAINING TO LAD
REQUEST FILING TO BE MLC STATUS UNKNOWN—Deadline  1/7/2019 COPYRIGHT OFFICE 90 DAYS 726 days
DESIGNATION OF MLC STATUS UNKNOWN—Deadline  7/7/2019 COPYRIGHT OFFICE 270 days 545 days
FORMATION OF MLC NONPROFIT AMLC nonprofit formed

NMPA/NSAI STATUS UNKNOWN

MLC 36 days 782 days
SUBSTITUTION OF BLANKET LICENSE FOR ALL EXISTING COMPULSORY LICENSES AUTOMATIC 10/11/2018

 

COPYRIGHT OFFICE 782 days
MLC BUDGET STATUS UNKNOWN

(Assume deadline of 1/7/19)

MLC/DLC/CRJ 782 days
INITIATE ASSESSMENT PROCEEDING w/CRJs [MUST COMMENCE NO LATER THAN 7/7/2019]

STATUS UNKNOWN

MLC/DLC/CRJ 233 days 545 days
ASSESSMENT RULING [PUBLISHED IN FR NO LATER THAN 7/7/2020] MLC/DLC/CRJ 599 days 179 days
APPEAL OF ASSESSMENT RULING 30 DAYS AFTER PUBLICATION OF ASSESSMENT RULING MLC/DLC/CRJ/ DCCOA 667 days 149 days
MLC BUSINESS PLAN STATUS UNKNOWN

(Assume deadline of 1/7/19)

MLC/CO 90 DAYS 726 days
ANNOUNCED BOARD NOMINEES AMLC board announced (see DMN and above)

NMPA/NSAI called for nominations.

The deadline for NMPA nominations passed on November 15  see NMPA.  NSAI are accepting nominations for songwriter board member seats with a December 15 deadline.  (these are nonstatutory deadlines) Songwriter board selection by Steve Bogard (NSAI), Rick Carnes (SGA), Lynn Gillespie Chater (SGA), Dallas Davidson (BMI), Chris DeStefano (NSAI), Bob DiPiero (BMI), Dan Foliart (ASCAP), Adam Gorgoni (SONA), Michele Lewis (SONA), Paul Williams (ASCAP)

(Assume final deadline of 1/7/19)

MLC 90 DAYS 726 days
APPOINTED BOARD AMLC Board Announced:

John Barker (founder, president & CEO of ClearBox Rights, LLC).

Brownlee Ferguson (founder, Bluewater Music).

George Howard (co-founder of both Music Audience Exchange and TuneCore and CIO of Riptide Publishing).

Lisa Klein Moberly (founder and president of Optic Noise).

Benji Rogers (singer-songwriter, founder of PledgeMusic and co-founder of dotBlockchain Media)

Jeff Price (founder of Audiam and co-founder of TuneCore)

Henry Gradstein (music industry attorney at Gradstein & Marzano, P.C.)

Larry Mestel (founder, Primary Wave)

Ricardo Ordoñez (founder and president of Union Music Group)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/7/19)

MLC/CO 90 DAYS 726 days
APPOINTED DLC STATUS UNKNOWN—Deadline  7/7/2019 COPYRIGHT OFFICE 270 days 545 days
ENGAGED  MLC VENDORS AMLC:  Clearbox Rights, Audiam (others)

NMPA/NSAI: STATUS UNKNOWN

(Assume deadline of 1/7/19)

MLC 90 DAYS 726 days
PAID MLC VENDORS AMLC: See board members above

NMPA/NSAI: STATUS UNKNOWN (ASSUME 7/7/2020 IF NO APPEAL OF ASSESSMENT)

MLC 270 days 545 days
ANNOUNCE MLC DATA STANDARDS STATUS UNKNOWN MLC/DLC
REGULATIONS* STATUS UNKNOWN COPYRIGHT OFFICE
COMMENTS AND REPLY COMMENTS ON REGULATIONS STATUS UNKNOWN ALL
EXPLANATION OF OPERATIONS: HOW TO REGISTER WITH MLC AND COST OF REGISTRATION STATUS UNKNOWN

(Assume deadline of 1/7/19)

MLC/CO 90 DAYS 726 days
REGISTRATION START DATE STATUS UNKNOWN

 

MLC=Mechanical Licensing Collective

DLC=Digital Licensee Coordinator

CRJ=Copyright Royalty Judges

DCCOA=District of Columbia Circuit Court of Appeals

CO=Copyright Office

LAD=License Availability Date

*Topic areas to be updated as announced

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