SoundExchange Sues Muzak
April 3, 2015 at 4:20 AM (PT)
SOUNDEXCHANGE is suing MUZAK for underpayment of sound recording rights fees. The suit alleges that when Canadian operator MOOD MEDIA CORP. bought cable/satellite TV music company DMX, which services DIRECTV, it paid the latter's fees at MUZAK's rates, which are "legacy" rates lower than market value, rather than the market rates it had been paying before being acquired by MOOD MEDIA, according to SOUNDEXCHANGE.
In a statement, SOUNDEXCHANGE Pres./CEO MICHAEL HUPPE said, “MUZAK is playing a shell game to cheat artists and rights holders out of royalties. It is bad enough that a handful of legacy services are permitted to pay below market value for the music at the heart of their business; but with this latest move, MUZAK adds insult to injury by attempting to extend this unfair rate to newer, ineligible services.
“MUZAK’s attempt at gaming the system highlights the ineffectiveness of having different rules and rate standards for music service companies. It gives older companies an unjustified competitive advantage, and leaves the door wide open for attempts at abuse.
“We hope this litigation can bring a quick and proper end to MUZAK’s unlawful practices so that artists and rights holders are properly compensated when their creative work is used.”