Artist Attorney Attacks SoundExchange's Lobbying Efforts
August 13, 2007 at 11:17 AM (PT)
The growing dispute between the label-backed SoundExchange and parties sympathetic to Internet radio and terrestrial radio Net broadcasters is bound to get even more intense with the release of a letter from NASVHILLE entertainment lawyer FRED WILHELMS. After reading a story in WIRED.COM about SoundExchange's potentially illegal lobbying efforts, WILHELMS fired off a lengthy letter. The NAB's perpetually-in-overdrive press organ has distributed it industry-wide.
When SoundExchange refused to divulge where the funding for the lobbying is coming from, WILHELMS wrote, "I strongly urge SoundExchange immediately appoint a truly independent entity to review SoundExchange’s operations and issue a public report as to its compliance with all legal requirements and limitations. The credibility of the organization has been questioned, and only independent evaluation can restore it. SoundExchange already has important obligations to recording artists and record labels. The integrity with which it carries out those obligations is now in serious doubt. The questions and the doubt must be put to rest, one way or another.
SoundExchange has important obligations to recording artists and record labels. The integrity with which it carries out those obligations is now in serious doubt.
"Any reduction of the payment on account of expenditures for a purpose unrelated to the royalties earned by my clients by their performances on satellite and Internet broadcasts is impermissible by law and a breach of the trust placed in SoundExchange," he continued. "It doesn't keep that promise to pay the artists and labels what they have earned when it spends money on something that doesn't promote those specific goals.. Any suggestion that the amount of that reduction is information they cannot have because it is 'proprietary' [as SoundExchange JOHN SIMSON claimed in the WIRE story] is reprehensible. My clients’ interests are not served by keeping that information private.
"On behalf of my clients, I demand that you immediately publicly release all information relating to the expenses incurred in the musicFIRST campaign by SoundExchange, and the extent of its commitment to cover future costs of the campaign. My clients deserve to know what you are doing with their money. My clients want to know who approached SoundExchange, who brought the matter to the Board’s attention, and who voted for and against it."