Federal Judge Strikes Down Pandora's Request To Lower Its BMI Royalty Rate
July 30, 2015 at 9:26 AM (PT)
PANDORA has lost its case in a NEW YORK court to have its BMI royalty rate lowered to the broadcast rate paid by terrestrial stations. A federal judge rejected the webcasters argument that their ownership of a SOUTH DAKOTA radio station entitled it to pay a lower rate.
Earlier this month (NET NEWS 7/1), PANDORA formally asked the Federal Rate Court to re-consider its decision that set the webcaster's BMI licensing rate at 2.5% of revenue. The basis for the request? The company's purchase of KXMZ (HITS 102.7)/RAPID CITY, SD from CONNOISSEUR MEDIA (NET NEWS 6/2).
PANDORA Dir./Public Affairs DAVE GRIMALDI explained to ALL ACCESS that the purchase of the terrestrial station was, "one of the motivations," to get the preferred royalty rate negotiated by the RADIO MUSIC LICENSE COMMITTEE, but it was also, "really great synergies."
In the paperwork, PANDORA asked the 2nd Circuit for the cheaper rate to take effect to when it began the process of buying KXMZ two years ago.
LAW360 now reports, "Without explanation, U.S. District Court Judge LOUIS L. STANTON denied PANDORA's motion to alter his decision ordering the music-streaming company to pay a 2.5% royalty rate to BMI," noting, "ATARA MILLER of MILBANK TWEED HADLEY & MCCLOY LLP, representing BMI, told LAW360 WEDNESDAY that she was happy with the outcome."
“We are pleased that Judge STANTON agrees with BMI that there was no need to revisit his well-considered opinion. We look forward to defending this matter on appeal,” MILLER said.
PANDORA had been seeking a rate of 1.7%, but STANTON ruled the webcaster couldn't be compared to a traditional radio station.
Look for PANDORA to appeal the decision this FALL.