Introduction
From the earliest days of our Republic, politicians have relied on music as a tool to evoke certain emotions and communicate to the masses.1 Songs like “The Favorite New Federal Song” and what became “The Star-Spangled Banner” accompanied George Washington’s and John Adams’s elections as expressions of patriotism.2 Since the Founding Fathers, politicians on the campaign trail have continued to tap into music’s unique ability to rile up crowds and convey beliefs.3 However, musicians have often clashed with politicians over whether they authorized the use of their songs.4 Often, a campaign picks popular songs without contacting the artists, or without ensuring it has obtained the proper license.5 To the public, the use of a song can imply the artist’s endorsement of the candidate, and as such, artists are left to decide whether to call out the candidate publicly in an effort to disassociate from them, or allow the public to think they support the candidate.6 At stake for the musician are their reputation and the possibility that their song becomes emblematic of a political movement they do not support, altering the meaning of their music.7
Though recent disputes between musicians and politicians seem fitting of current political divides, they are not a new phenomenon: Bruce Springsteen objected to Ronald Reagan’s use of “Born in the U.S.A.,” Bobby McFerrin objected to George H.W. Bush’s use of “Don’t Worry, Be Happy,” Sting objected to George W. Bush’s use of “Brand New Day,” and Sam Moore objected to Barack Obama’s use of “Hold On, I’m Comin’.”8 Donald Trump received his fair share of cease and desists, and in a relatively recent, notable case, Neil Young sued Donald Trump for copyright infringement after he used his songs “Rockin’ in the Free World” and “Devil’s Sidewalk” at several rallies since 2015.9 Young took issue with his music becoming the “theme song” for a campaign he vehemently opposed.10 However, Young dropped the suit, voluntarily dismissing the case with prejudice and without comment.11
Despite attempts to successfully sue under copyright law, right of publicity, or false endorsement, legal redress for musicians remains uncertain.12 This is because campaigns usually obtain licenses to use millions of songs from performing rights organizations (PROs), like the American Society of Composers, Authors and Publishers (ASCAP) and Broadcast Music, Inc. (BMI).13 Both ASCAP and BMI control the performing rights of millions of songs and license their catalogs through either venue-specific licenses or campaign-specific licenses.14 Under copyright law, this authorizes political campaigns to use millions of songs, making copyright infringement claims difficult to prevail on.15
As a result of legal uncertainties, most musicians have expressed their disapproval to the public in an effort to push politicians to cease and desist from using their songs.16 Some artists, like the Rolling Stones, are now trying to avoid legal issues altogether by requesting that ASCAP and BMI remove their songs from a special license for political campaigns, so that no politician can have access to their music unless they directly ask for permission.17 Whether artists can opt out of this political license is questionable because ASCAP and BMI are subject to Department of Justice (DOJ) antitrust consent decrees that govern the terms of their licensing agreements and restrain their power in the music licensing marketplace.18 The consent decrees prevent artists from partially withdrawing their works from performing rights organizations, meaning they cannot selectively remove their works from a license for a certain category of licensees, while using the PROs to license those same works to other categories of licensees.19 They must either license all of their works to every license category, or none at all.20 This arises in the context of new media licenses, as removing works from that category leads to direct licensing with platforms like Pandora and Spotify and higher licensing rates.21 This same prohibition on partial withdrawal informs the analysis on whether the political licenses, one of the license categories, are in violation of the consent decrees and the judicial decisions surrounding their interpretation.
This Note proceeds in two Parts and assesses whether ASCAP’s and BMI’s political licenses, in allowing artists to remove songs, constitute a violation of antitrust law. Part I of this Note begins with a background on the right of public performance in the United States under the Copyright Act and introduces the role of PROs in music licensing and the DOJ consent decrees. Next, Part I provides a background of antitrust law and its relevance in regulating ASCAP and BMI. Part I introduces the specifics of the ASCAP and BMI consent decrees, beginning with a brief history of how they came to be and the relevant cases that continue to affect their interpretation, focusing on the Pandora cases. Part I discusses the evolution of consent decrees, how they have changed, and what they now require of ASCAP and BMI, looking closely at the language of their current iterations. Part II assesses whether, given the current interpretation of the consent decrees as explained in Part I, ASCAP’s and BMI’s political licenses violate the consent decrees and whether they violate larger antitrust principles. Part II argues that, in light of the courts’ decisions in the Pandora cases, the political licenses do violate the consent decrees, highlighting the conflicts between the political licenses and the consent decrees. Part II also argues that while the political licenses do violate the consent decrees, they are not necessarily contrary to underlying antitrust laws. Part II concludes by discussing the implications of this violation and the next steps the DOJ and artists can take, such as amending the consent decrees or turning to nonlegal recourse. This Note concludes that even if artists are unable to legally withdraw works from the political license, resulting in less control over the use of their works, this could benefit the public good.
I. Background
Before assessing the potential antitrust violation by ASCAP and BMI, it is crucial to understand the PROs’ role in the music licensing landscape under U.S. copyright law, as well as basic principles of antitrust law.
A. The Right of Public Performance
Under the Copyright Act of 1976, as long as an original piece of music is fixed in a tangible medium, a copyright is created.22 A piece of recorded music often has two sets of rights: the “musical work” and the “sound recording.”23 The musical work, created by the songwriter, is the underlying composition including the lyrics, whereas the sound recording is the performance of the musical work fixed into a recording.24 These can be owned by the same entity or separate entities, and often, the musical composition is owned by a publisher and the sound recording is owned by a record label.25 The copyright owner in the musical work is entitled to certain exclusive rights for a fixed number of years, one of which is the exclusive right to publicly perform the copyrighted work.26 The public performance right protects an artist from having their music played in public without their permission and without compensation.27 Performing rights are implicated each time a song is played on the radio, television, any streaming platform, at a venue, or in a business.28 Monitoring each time a song is publicly performed via thousands of businesses and venues is burdensome to artists, leading most artists to choose to affiliate themselves with PROs to monitor the use of their works.29
When a copyright owner in the musical work affiliates with a PRO, they enter into an agreement that grants the PRO the right to license their performing right and ensure they are paid royalties each time the song is performed in public.30 To obtain a license to perform a song publicly, a licensee must approach the owner of the copyright in the underlying composition and pay for use or purchase a license from a PRO.31 Since issuing thousands of licenses to individual users would result in cumbersome administrative work, PROs act as intermediaries to streamline this process.32
B. The Role of Performing Rights Organizations
In the early twentieth century, the American Society of Composers, Authors and Publishers and Broadcast Music, Inc. were founded as nonprofits to address the volume of administrative work in music licensing and act as intermediaries between copyright owners and music users.33 ASCAP’s and BMI’s “primary function is to pool the copyrights held by their composer, songwriter, and publisher members or affiliates and collectively license public performance rights to music users such as radio and television stations, streaming services, concert venues, bars, restaurants, and retail establishments.”34 Songwriters, publishers, or whoever owns the underlying musical work become members with either or both PROs, which then issue blanket licenses to businesses and send the money paid for the licenses to their members as royalties.35 Most music users, as ASCAP and BMI call them, opt for blanket licenses, paying a fee in exchange for the right to play any music by ASCAP’s or BMI’s members.36 There are different licensing agreements depending on the music user, categorized by business type like retail, fitness, church, local government entity, or political campaign.37 Together, ASCAP and BMI license about ninety percent of music in the United States and each has annual revenues of over one billion dollars.38
From ASCAP’s creation in 1914, followed by BMI’s in the 1930s, both PROs grew to become the largest PROs in the United States.39 By 1940, ASCAP and BMI controlled a wide margin of the performing rights market.40 Both PROs originally offered blanket licenses and retained the exclusive rights to their members’ public performance rights, preventing members from entering into direct licensing agreements.41 Though other PROs were created in the United States throughout the twentieth century, such as the Society of European Stage Authors and Composers (SESAC) and Global Music Rights (GMR), ASCAP and BMI continued to dominate the market.42 As a result of ASCAP’s and BMI’s control of the music licensing market, concerns grew over anticompetitive behavior.43 The DOJ began antitrust proceedings against both PROs, resulting in consent decrees that have endured until now.44
C. Antitrust Background
To understand why the political licenses violate the ASCAP and BMI consent decrees and whether they further violate antitrust laws, it is necessary to understand the basic purpose of antitrust law. The primary goal of antitrust law is to protect and promote competitive markets, resulting in benefits to consumers.45 Antitrust laws impose liability on certain commercial conduct that interferes with this goal.46 In the context of the ASCAP and BMI duopoly, the relevant conduct is proscribed under Sections 1 and 2 of the Sherman Act.47 Unlawful restraints of trade are prohibited under Section 1, which states that “[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”48 Monopolization offenses are prohibited under Section 2, but having a monopoly is not itself unlawful unless there is an element of anticompetitive conduct.49
One way in which antitrust laws promote competition is by making collusion among competitors to inflate prices illegal.50 Price fixing is a form of collusion that is subject to criminal prosecution by the DOJ.51 An example of a price-fixing agreement is one that adopts a standard formula for computing prices, just as the ASCAP and BMI blanket licenses do.52 Though it seems that the blanket licenses violate the Sherman Act, courts have held that they are not per se unlawful restraints of trade.53 The Supreme Court and Second Circuit carved out an exception for blanket licenses because they were the most efficient solution for licensing and because ASCAP and BMI offered an alternative license, the per-program license, giving consumers the choice to choose another kind of license.54 The per-program license is usually obtained by radio stations or television networks and provides access to all of the works in the PRO’s repertory, but allows the licensee to pay based on how much of the work they use, resulting in a more proportionate fee structure.55 The consent decrees operate as rules of engagement for ASCAP and BMI to regulate their market power and restrain the potential anticompetitive effect of offering a blanket license.56 The antitrust concern, with respect to partial withdrawals, is that a rights owner could pick and choose to withdraw rights from certain categories because they could get higher fees from those licensees at market price, while still benefitting from the PROs’ rights administration system for other categories of licensees.57 This would result in a distortion of market prices.58 The PROs could potentially collude with withdrawing members by allowing them to withdraw and obtain higher licensing rates, which would then be used as benchmarks when PROs negotiated their licenses.59 These concerns are at the crux of the debate surrounding partial withdrawal and inform this Note’s analysis of whether removing works from the political licenses has anticompetitive effects. This will be elaborated on in the following Sections.
D. The ASCAP and BMI Consent Decrees Past and Present
ASCAP and BMI have been subject to antitrust consent decrees since 1941, and they were most recently reviewed in 2016 and 2021.60
1. The Consent Decrees Through the Years
In 1941, the DOJ initiated antitrust proceedings against ASCAP and BMI.61 The complaint alleged that ASCAP’s and BMI’s blanket license eliminated competition against members of the PROs by allowing them to fix prices, resulting in an illegal restraint of trade under Section 1 of the Sherman Act.62 The government’s antitrust concerns stemmed from a fear that ASCAP and BMI would become a monopoly and that pooling compositions with an all-or-nothing use would allow performing rights organizations to charge arbitrary prices.63 For example, since both ASCAP and BMI form a duopoly, licensing the vast majority of songs in the United States, a venue has no real choice but to pay the PROs for a license, giving the PROs vast market power and the ability to drive up prices. The government also feared the possibility of ASCAP and BMI colluding to offer the same prices, which would remove any meaningful competition from the marketplace.64 The objective of the lawsuit was to enjoin blanket licensing so that the PROs would create less monopolistic licensing schemes.65 Ultimately, however, the government dismissed its charges against ASCAP and BMI, settling with the first iteration of the consent decrees at issue.66 The consent decrees are non-sunset provisions;67 they are legally binding on the PROs, acting as government regulations on performing rights licensing.68
The ASCAP consent decree allowed ASCAP to continue blanket licensing but required the introduction of an alternative license, the per-program license.69 The original consent decree prevented ASCAP from artificially inflating its license’s price by withholding parts of its repertory from licensees.70 The consent decree limited ASCAP’s ability to exert too much control over the music licensing market, given that it licensed the majority of available music and used blanket licenses to obtain noncompetitive prices.71 The decree further required ASCAP to grant memberships to all those who were interested in joining the society and prevented discrimination against similarly situated licensees.72
After the 1941 consent decree went into effect, a series of litigation throughout the 1940s led to an amendment in 1950.73 The 1950 amended decree established rate court judicial proceedings entered into by ASCAP and its licensees if they could not agree on a reasonable rate.74 It also required ASCAP to provide its users with real economic choice when setting its blanket license and per-program fees.75 Finally, the amendment required ASCAP to acquire public performance rights on a nonexclusive basis, so that music users could obtain licenses directly from composition owners.76 The 1950 consent decree still controls much of ASCAP’s present regulation.77 BMI entered into its consent decree in 1966, with similar terms.78
Since the 1950 amended decree, ASCAP and BMI have continued to face antitrust challenges in court. Notably, CBS v. ASCAP in 1975 challenged blanket licensing, which was ultimately upheld by the Supreme Court on the grounds that it was the most efficient licensing option and not anticompetitive because, under the consent decree, there existed an alternative license option, the per-program license.79 Although blanket licensing was allowed, because it is an inherently anticompetitive method of licensing, it is still central to the debate surrounding the modification of the consent decrees, and many supporters of the decrees see them as necessary checks to the blanket license’s potential for anticompetitive effects.80
The BMI consent decree was last amended in 1994, and the ASCAP consent decree was amended in 2001.81 As a result of litigation between BMI and its users, BMI’s consent decree was modified to establish a rate court comparable to ASCAP’s.82 This version of ASCAP’s consent decree, known as the Second Amended Final Judgment (AFJ2), was modified to include four types of licenses it would offer: per-program licenses, per-segment licenses, blanket licenses, and through-to-the-audience licenses.83 The AFJ2 further details the rate court and contains provisions that prohibit discriminating between similarly situated licensees and denying licenses to anyone requesting one.84 These modifications were made prior to the digital music era, and as such, have necessitated review since then. The latest review was concluded on January 15, 2021.85
With the rise of new digital media and legal disputes involving licensing to streaming services, the consent decrees were again revisited. In 2011, online radio service Pandora and ASCAP entered into an agreement for a five-year blanket license.86 Around the same time, ASCAP members, like major publishing companies EMI, Sony/ATV, Warner, Universal, and BMG, withdrew or threatened to withdraw from ASCAP’s license to new media services.87 The members were concerned that ASCAP’s licensing rates for new media services, including Pandora, were below-market rates, preferring instead to license with the services directly in order to secure higher rates.88 Though the members wanted to bypass PROs with respect to new media licenses, they wanted to use ASCAP to license their works to traditional music users, like venues, broadcast radio, and businesses.89 In order to quell its members’ threats, ASCAP modified its rules and allowed them to withdraw.90 As a result, the major publishers began to negotiate direct licenses with Pandora.91
This was short-lived because, in 2012, Pandora brought suit in the rate court to determine reasonable fees for the blanket license after a year of failed negotiations with ASCAP and addressed the issue of partial withdrawal.92 In 2013, Pandora moved for summary judgment on the matter of partial withdrawal, arguing that the consent decrees require ASCAP to license all works in the repertory, preventing the publishers from withdrawing works from new media licenses.93 The judge granted Pandora’s motion for summary judgment, interpreting the language of the consent decree to unambiguously require ASCAP to offer Pandora a license that includes all of the works in its repertory.94 The judge did not give much weight to ASCAP’s claim that it could no longer license the works of withdrawing publishers to new media users.95 Instead, the judge reasoned that, as long as ASCAP retained their works in its repertory to license to other classes of users, this meant that ASCAP was problematically not licensing all of its works to Pandora.96
At issue in the dispute was the interpretation of a few provisions in the consent decree, including Section IV(C), prohibiting “[e]ntering into . . . any license . . . which discriminates in license fees . . . between licensees similarly situated” and Sections VI and IX(E), requiring ASCAP to “grant to any music user . . . a non-exclusive license to perform all of the works in the ASCAP repertory.”97 The parties disagreed on the interpretation of “works in the ASCAP repertory,” but the judge sided with Pandora, defining the phrase in terms of works and compositions and not individual rights in compositions with respect to classes of potential licensees, as ASCAP argued.98 The Second Circuit affirmed, holding that ASCAP offers the licensing of works to publishers on a take-it-or-leave-it basis; publishers can either license all their works across all license categories, or not license any works through the PRO, but they cannot selectively withdraw the right to license works for a particular category, like the new media license, and not others.99
Around the same time, BMI faced the same issue with Pandora. The parties entered into similar proceedings, and the Southern District of New York also found that publishers could not partially withdraw from their BMI licenses.100 Like ASCAP, in 2013 BMI allowed its members to opt for Digital Rights Withdrawal to prevent licensing to new media applicants.101 The court held that BMI’s consent decree required it to offer all compositions in the BMI repertory to all of its applicants.102 Furthermore, the court’s ruling differed from ASCAP’s in its characterization of the restriction, interpreting it as an “all-out” rule, rather than an “all-in” rule.103 This meant that if BMI’s members refused to license certain works to certain users, like Pandora or other New Media entities, those works were automatically excluded from BMI’s repertory.104 Notably, the court held that the language in the consent decree cannot be interpreted to allow a player such as BMI, with its vast control over the market, to decide when it wants to discriminate against potential licensees.105
In 2014, following the Pandora cases, ASCAP and BMI advocated for another modification of the consent decrees that would allow for partial withdrawal, among other changes.106 The DOJ opened a period of review that lasted two years.107 In 2016, the DOJ announced there would be no modifications to the consent decree.108 Though the DOJ received many comments on partial withdrawal, the central focus of the decision was the debate between full work and fractional licensing, and the biggest change to the interpretation of the consent decree was in requiring full-work licensing.109 The DOJ came to its decision not to act on partial withdrawal because there was not enough information on the competitive effects of partial withdrawal to determine if it would be in the public interest, and the uncertainty and changes regarding full and fractional licensing would render any other changes too disruptive to the industry.110 That the DOJ specifically asked for comments on whether partial withdrawal should be permitted during its period of review, coupled with its decision not to modify the decrees, clearly confirms that partial withdrawal is not allowed under the consent decrees.111
The most recent revision of the consent decrees began in 2019 and ended in January 2021, during which ASCAP, BMI, and other music industry players again advocated for modification or even termination of the consent decrees.112 After the DOJ held a public workshop of hearings and received public comments from a range of participants in the music licensing ecosystem, it decided to make no changes to the consent decrees.113 Again, the DOJ offered little detail on partial withdrawal, but in doing so, affirmed that it continues to be prohibited.114 The remarks briefly addressed partial withdrawal, pointing to the 2013 Pandora decisions that prohibited it, and stated that overruling the decisions would require a modification of the consent decrees or an act of Congress.115 Given the Pandora decisions and lack of action from the DOJ, partial withdrawal is currently prohibited.
II. Analysis
A. The Political Campaign License—A Violation of the Consent Decrees?
Given the current state of the ASCAP and BMI consent decrees, the Pandora cases, and the decisions from the DOJ in 2016 and in 2021, the political licenses from both PROs are in violation of the consent decrees.
1. The Political Entity License
ASCAP and BMI each have their own versions of a political license that allows members to withdraw songs from the license if they object to the intended use by the candidate.116 The members must notify the PROs of the works they seek to withdraw, and the PROs must notify the campaigns.117 The licenses were created to ensure campaigns properly license songs used on the campaign trail, given that venues either do not obtain PRO licenses or their licenses do not include campaign activities.118 As the stops on the campaign trail vary and have different licensing needs, whether a convention center, a warehouse, or outside, the political license allows campaigns to streamline the process of ensuring they have proper authorization to play music.119 As ASCAP explains, the licenses clarify a campaign’s legal obligations, especially in light of the disputes between artists and candidates and unwanted publicity.120 Notably, campaigns must be aware of the fact that some large venues like arenas or hotels may have PRO licenses that do not encompass third-party events, including campaign events, requiring the campaigns to be responsible for obtaining the rights.121
BMI created the Political Entities or Organizations License ten years ago in an effort to bring campaigns into compliance with copyright law.122 The license explicitly allows members to remove works from the license, stating that “a specific work may be excluded from this license if notice is received from a BMI songwriter or publisher objecting to the use of their copyrighted work for the intended uses by [licensee].”123 It also states that a campaign cannot rely on a venue license to authorize its performance of an excluded work.124 In the case of the Rolling Stones and Donald Trump, BMI has claimed that the Trump campaign has a political entities license but, pursuant to the agreement, the campaign was notified that the Stones requested its works be removed from the license, and any future use of the song would result in a breach of the agreement.125 Additionally, if an artist sends a cease and desist letter to a political candidate, any future use is a breach of the candidate’s contract with the PRO.126
ASCAP’s license, called the ASCAP Political Campaign License, similarly provides for the removal of songs upon the member’s request.127 ASCAP’s license extends only for the duration of the campaign, until the candidate is sworn into office.128 Additionally, ASCAP informs its members and users that, despite having proper authorization from the political license to use certain songs, a campaign still faces the possibility of disputes with artists who take issue with the candidate’s use of the song.129 Artists can publicly criticize the candidate or sue them under noncopyright infringement causes of action, such as right of publicity, the Lanham Act, or false endorsement.130 The PRO mentions this to encourage campaigns to seek the ultimate protection from liability for using an artist’s songs—directly asking the artist for permission.131
While the licenses are explicit about their members’ options to remove works from the political license, it remains unclear who exactly gets to exercise the right to remove the song.132 An ASCAP or BMI member owns the underlying copyright in the composition, not the sound recording.133 The member can be an individual songwriter, a publisher, or whoever owns part of the underlying copyright.134 Songs can be created by a single singer-songwriter, but often, many people are involved in writing a song.135 This complicates matters in the context of objecting to the political use of the songs because, while a famous singer may object to a politician’s use of their song publicly, they might not necessarily be the songwriter or own the copyrights.136 Additionally, multiple songwriters or publishers involved in a song may not all agree on whether to remove a song from a political license. It is unclear if nonsongwriters or publishers are able to have a say in withdrawing the work from the license.
2. The Political Entity License Violates the Consent Decrees
Given the Pandora cases and current interpretation of consent decrees that prevent partial withdrawal from ASCAP and BMI, the political licenses, in allowing artists to withdraw their songs, directly contradict these decisions.137
The current political licenses raise the same concerns the courts had about the anticompetitive effects of allowing the PROs to refuse licensing of their “full repertory” to licensees.138 If one artist could refuse to license their works to a campaign or all campaigns, this could open the door to most artists choosing to do so, which would be, in essence, ASCAP and BMI “refus[ing] to deal with certain . . . applicants.”139 It follows that a campaign could be left with a license that contains few to no songs, given the option to withdraw.
In addition to contradicting the Pandora decisions, the political licenses also conflict with the language of the consent decrees prohibiting partial withdrawal, as interpreted in 2016 by the DOJ.140 From the customer/licensee perspective, partial withdrawal from the political license shuts out a licensee and results in disparate treatment of customers, where the consent decrees explicitly prohibit discrimination against similarly situated licensees.141 Though ASCAP and BMI are not refusing to license to campaigns, which would blatantly violate the consent decrees, they are refusing to license all of the works in their repertories.142 As Judge Cote reasoned in her decision in Pandora, if the court sided with ASCAP, it would be incorrectly interpreting Section XI(B)(3)(c) to allow rightsholders to keep works in the ASCAP repertory, while selectively depriving licensees of certain works of their choosing.143 This clearly conflicts with Sections VI and IX’s explicit statement that ASCAP has to license all of the works in the repertory to anyone requesting a license.144
BMI and ASCAP have yet to be challenged on whether the political license violates the consent decrees, but by continuing to offer them, they operate under the assumption that they are not in violation.145 BMI and ASCAP’s arguments were rejected by the Second Circuit, but they illustrate the arguments they might make in support of their position that the political licenses are not unlawful.146 One notable argument rests on the sections of the consent decrees relating to the PROs’ rights to protect the economic value of their works, found in Section IV(F).147 This argument appears to be the driving justification for ASCAP and BMI in continuing to offer the political campaign license.148 According to one of the only public statements on the issue to date, ASCAP and BMI believe that they can withdraw works under certain conditions, one of which is to prevent the erosion of the economic value of a song’s copyright, as it is worded in the consent decree.149 BMI’s public statements on the political licenses, made by their general counsel, imply that the association or endorsement of a particular political candidate can harm the economic value of a work, thus falling under Section IV(F)’s withdrawal-under-certain-conditions language.150
The relatively recent statements in the media underscore the possibility that, should ASCAP and BMI face challenges to the political license work withdrawals, they might successfully argue that withdrawing works from the political license falls within the scope of the exception in Section IV(F). ASCAP attempted to make this argument in the Pandora case, but it failed with respect to New Media rights.151 The judge rejected ASCAP’s argument that “all-in” or “all-out” was at odds with Section IV(F).152 Instead, the judge was convinced by Pandora’s arguments, finding that Section IV set forth narrow prohibitions that did not trump the broad, affirmative requirements of Sections VI and IX about licensing all works to any music user that were central to the consent decrees.153 Additionally, Pandora argued that Section IV(F) did not apply to the case at bar and was intended to apply to situations like licenses for pornographic films that would devalue the copyright, arguing that instead, licensing to Pandora would increase the value of the work.154
If a political license were considered akin to the porn example in its potential to devalue a copyright, the PROs might prevail. But absent any judicial or regulatory decisions about the political licenses and what constitutes an exception under Section IV(F), this is uncertain. Furthermore, if the court’s reasoning for rejecting the Section IV(F) arguments for new media rights is any indication, an argument that the political license falls into the Section IV(F) exception faces an uphill battle.155 Though there certainly is a difference between licensing to digital service providers (DSPs) and political campaigns, the Pandora and DOJ opinions emphatically seek to uphold the requirements in the licensing sections and limit any possibility of anticompetitive behavior resulting from PROs withholding works and discriminating against licensees.156
Looming questions about the intersection between Section IV and the other sections should be clarified, and while the argument that political campaign licensing could fall into Section IV(F) is plausible, as it stands now, the general prohibition on partial withdrawal strongly suggests that the political licenses are violating the consent decrees.157 As such, by continuing to offer the option to withdraw songs from the license, ASCAP and BMI are either ignoring the judicial and DOJ decisions or presuming that the political license fits into the Section IV(F) exception.
3. The Political Entity License Does Not Violate Antitrust Principles
Though the political licenses violate both the Pandora decisions and the DOJ’s interpretation of the language of the consent decrees, the violation does not extend beyond the four corners of the decree, nor does it negatively impact the big picture goals of antitrust law. There seems to be a gap between the anticompetitive behavior the consent decrees are trying to regulate and the actual effects on competition of removing a song from the political license.
The public comments surrounding the DOJ’s 2016 and 2021 revisions of the consent decrees provide further insight into whether partial withdrawal violates antitrust principles. BMI and ASCAP naturally argued that partial withdrawal is not anticompetitive, but rather furthers procompetitive goals.158 One argument in support of this position is that going “all-in” has the effect of forcing collective licensing rather than giving publishers the freedom to directly license their works in a free market, contradicting the intended goal of the consent decree to encourage procompetitive behavior.159 Furthermore, partial withdrawal is consistent with antitrust principles, favoring direct licensing over collective licensing.160 Another argument is that partial withdrawal would actually serve procompetitive interests by encouraging direct licensing, which would allow rates to be set by market forces and not rate courts, while giving publishers and songwriters the option of benefiting from the PROs’ efficiencies.161 If an increase in direct licensing resulted from allowing partial withdrawal, publishers and songwriters would benefit, as they could obtain fair compensation that reflects the market value of their works.162 Certain smaller, independent publishers also agree that partial withdrawal would be in the best interest of their songwriters, allowing them to benefit from the market value of their works.163 They argue that if larger publishers are unable to partially withdraw from PROs, they will withdraw completely, hurting independent publishers, because PROs’ bargaining positions would be eroded and would require them to accept below market rates.164
One argument in favor of partial withdrawal hinges on the idea that prohibiting partial withdrawal is not actually addressing the anticompetitive threats of ASCAP and BMI, because it has the effect of regulating the copyright owners rather than the PROs.165 This concern emphasizes the effect of the prohibition on the ability of copyright owners to act freely, noting that they are not parties to the consent decree, and the prohibition does not have the effect of controlling ASCAP’s and BMI’s actions.166
Addressing the gap between the outcome of the courts’ and DOJ’s interpretations of partial withdrawals and actual anticompetitive effects, BMI stated that the consent decrees unnecessarily focus on matters that do not implicate antitrust concerns.167 Accordingly, the PRO critiqued the litigation with Pandora, arguing that the focus on whether the partial withdrawal of works was consistent with the language of the consent decrees did not adequately address the larger antitrust issue.168 The comment went on to explain that both Pandora cases failed to consider the beneficial or detrimental effects of rights withdrawal on competition.169
Rather than focusing on the language of the consent decrees, BMI emphasized that the relevant inquiry should focus on the economic effects of actions like partial withdrawal.170 If there were no consent decrees, this inquiry would be used when analyzing the legality of partial withdrawals and would spare the PROs from having to constantly assess whether their actions are in violation of their consent decrees.171 As a result of the uncertainty surrounding how the consent decrees are interpreted, BMI argued that it is disincentivized from engaging in procompetitive activity.172
ASCAP’s public comment added that the consent decrees should be modified to allow ASCAP to refuse an instance of partial withdrawal if licensing the limited rights did not add any economic value.173 The PRO concluded that allowing for partial withdrawal would harmonize the consent decrees with copyright law.174 Ultimately, ASCAP, BMI, and critics of the outcome of the Pandora cases and the DOJ’s 2016 revision feared that preventing partial withdrawal could lead to publishers opting out entirely of the PRO system, jeopardizing their business.175
Parties arguing that partial withdrawal would threaten antitrust principles are worried that PROs and publishers would use partial withdrawal as a means to obtain more bargaining power or higher fees from licensees.176 Basing their argument on what occurred when the major publishers withdrew from the PROs before the Pandora litigation, opposers of partial withdrawal argue that collusion between the PROs and publishers occurred, as the PROs facilitated the publishers’ withdrawals in order to use the outcome of those direct deals as a benchmark in the rate courts.177 They are also concerned that allowing partial withdrawal would hurt competition because it would cause the system to become even more complicated, hindering innovation and becoming a barrier to entry for new artists, especially smaller publishers and independent songwriters.178 Whereas supporters of partial withdrawal think the “all-in” or “all-out” regime would limit copyright owners’ options to their detriment, opposers of partial withdrawal view this limitation as preventing the copyright owner from having to make the difficult choice between shouldering the burden of high administrative costs to license directly to DSPs or license through the PRO at less competitive rates.179
While these arguments are plausible in the context of new media licensing, with respect to a political campaign license, the same anticompetitive concerns are not present. Realistically, artists and publishers withdrawing songs from the political license would not obtain higher licensing rates from politicians in the same way that publishers wanted to obtain higher rates from Pandora, knowing that obtaining these licenses were essential for streaming services.180 Here, the economics of the political license withdrawal differ from that of the new media license, impacting any analysis of the anticompetitive effects of the political license, because a campaign’s access to a particular song is arguably not as essential as it is for a streaming platform, and the demand is not nearly as high.181 As BMI’s general counsel explained, removing works from the political license is not to obtain a higher bargaining price or extort higher fees, but rather to protect the copyright’s value.182 Ultimately, even if certain works are missing from the political campaign license, the PROs would still be complying with the central tenet of the consent decrees by offering the license to any user without discrimination, precluding the concern that PROs were unfairly refusing to deal with certain music users.183 As such, they would not violate larger antitrust principles.
In light of the fact that the political licenses violate the consent decrees but nonetheless do not have anticompetitive effects, the DOJ could amend the consent decrees to allow partial withdrawal or specify that partial withdrawal is allowed for certain types of license categories, including the political license.184 While recent efforts to amend the consent decrees to allow for partial withdrawal have failed, artists still have some nonlegal recourse.185
The most recent review of the consent decrees was again met with comments from PROs and publishers, vocalizing their position that the consent decrees are outdated and no longer serve their initial purposes.186 Those who favor keeping the consent decrees argue that “[t]he market for music licenses is inherently anticompetitive, and traditional free market principles do not necessarily translate.”187
Ultimately, the DOJ concluded its period of review by determining that no modifications would be made, and the consent decrees would continue to operate.188 In announcing the decision, Assistant Attorney General for the Antitrust Division Makan Delrahim addressed critiques of the consent decrees but emphasized the music licensing community’s reliance on the current consent decrees.189 The Assistant Attorney General argued that the existing consent decrees were the best solution for all stakeholders.190 The remarks briefly addressed partial withdrawals, pointing to the 2013 Pandora decisions that prohibited them, and stated that overruling the decision would require a modification of the consent decrees or an act of Congress.191
Even if the political license is found to be in violation of the consent decrees and artists are no longer able to withdraw their works from the license, nonlegal recourse remains available. Songwriters, musicians, and rightsholders can continue to voice their opinions publicly.192 Though artists like the Rolling Stones and Neil Young have withdrawn their works, it is unclear how many others have chosen this option.193 Regardless, many artists have chosen the court-of-public-opinion option, using a myriad of avenues available to communicate to their audiences.194 Even if artists legally withdraw their works, it remains to be seen whether candidates will be cautious about obtaining the proper license or be sufficiently deterred by the threat of suit from artists.195
Should the aforementioned scenario play out—that artists are no longer able to withdraw their works and are left with nonlegal options—there are silver linings. Rightsholders will have less legal control over the use of their works if they cannot stop politicians from using the songs, but from an American copyright law perspective, this may be in the best interest of society. The current copyright law regime protects economic interests and grants a limited monopoly over works.196 The lack of legal control over the political use of music is consistent with the United States’ rejection of moral rights, which allow rightsholders to object to use of their works if they were contrary to their creative intentions or would negatively impact their personality or reputation.197 The right of public performance obtained through a PRO’s blanket license is an economic transaction that does not allow for the artist to object to the potential use.198 But this regime exists to promote the creativity and innovation to the benefit of society, even if individual artists’ rights and abilities to control their works takes the back seat. Less fettered control over music could allow it to be disseminated more freely, contributing to the exchange of art, ideas, and debate.
Conclusion
As this Note argues, BMI’s and ASCAP’s political licenses violate their consent decrees by allowing rightsholders to withdraw works from a specific license category. Though it is possible that an exception exists in the consent decree for withdrawing works that would protect the economic value of the copyright, at present there is no indication that the political license fits this exception. In fact, given the courts’ opinions in the Pandora cases and the DOJ’s goals, ASCAP and BMI would likely struggle in arguing that the exception applies. While the political licenses violate the consent decrees, withdrawing works from the license so campaigns are unable to use them does not have anticompetitive effects and, therefore, should be allowed. Though the simple solution would be for the DOJ to amend the consent decree to confirm that an artist can withdraw from any type of license, if this does not happen, artists and society may not be substantially harmed such that risking an uncertain licensing change would be worth it. They can turn to the media to speak out against the use of the music and disassociate from political candidates. Furthermore, even if artists cannot enjoy the ability to object to use of their songs, there are benefits to the public good in promoting a regime of less control over copyrights that can allow for a freer exchange and debate over art and music that is essential to a thriving culture.