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Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

L

Learning2Program

I'm a very occastional visitor to this board-- I come here when I get asked to research something online and can't find anything (thanks for your help in the past). Our little unrated station group has been going back & forth w/ ASCAP about an overdue amount owed. After months of back & forth w/ our accounting department, they agreed that they overcharged us. We sent in the amount our checked and triple-checked calculations say we owe, but they have not cashed the check and want SEVERAL thousand more, although they won't share their reasoning (extended out from the point where all parties agreed). They're basically saying "pay what we all know you owe PLUS $10K" or we'll make you come to New York to arbitrate... blah, blah.

Does anyone know a legal or consulting firm in NY (or wherever) who assists stations in their dealing w/ BMI / ASCAP ? I know they have the upper hand and are known for being unbudging and mysterious, but we have quite a paper trail with them that leads to OUR number rather than theirs.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Sometimes you go to a local lawyer and let him/her search out the specialist for you. Though your local may not know the ins-and-outs of music licensing, they should know the specialties and terminology to locate the lawyer or maybe an accountant that you need.

The other possibility is you find a local who knows enough about court jurisdictions that he can find a "handle" in your relationship which allow you to challenge the arbitration process and you move the issue to a local court out among the mountains and tumbleweeds or whatever you have there.

As long as they are operating on the basis that YOU have to come to the scene of arbitration they have picked, that is a burden on YOU. If you can get the thing into court on YOUR turf, the mood of this whole thing can change rapidly.

Going to the court room can be dirty business.... and it's a lot more fun when YOU are the one playing dirty.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Don't know where you are, but I would suggest finding an attorney at a large firm in whatever big city you are near. Often the fees charged by a large firm will, in the end, be fairly reasonable. While your case may be handled by a junior partner, he has the resources of the rest of the firm to back him up.

In any event, your attorney will need to be admitted to the Federal courts. If you get out of the arbitration requirements, ASCAP will try to move the case to Federal court as a harassment tactic.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Thanks, GRC and Tom. It's helpful to know what some of their typical moves are. We did find out from RMLC that BMI indeed seems to be pulling this latest # out of nowhere (I learned it's BMI, not ASCAP). We all agreed on a number as of summer 2010, but they seem to have come up with an arbitrary new formula for the months since then (at least RMLC says it's arbitrary since they know nothing about it and did not initiate any changes for our group). Our accounting department is telling me that BMI won't tell them what formula they're using for the most recent 5-6 months... hard to understand -- I'd love to be able to invoice whatever I felt like (as they seem to do).

Any further advice from anyone who is experiencing anything similar would sure be helpful.

Thanks again.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

I haven't been involved in this arena for years so I don't know what the standard proceedures are. It used to be a certain percentage of your advertising revenue. That percentage should be spelled out in your contract. Whether figuring FICA deductions, sales tax or royalties, normally you have a dollar amount of the transactions subject to taxation or royalty, and you simply multiply that by the rate and, voila, you know what to write the check for. The one time I got into a sticky-wicket was at a station where we had some trade-out advertising. Putting a true value on trade-outs / barters is sticky. So we ignored it and reported nothing. The music licensing auditor showed up, went through our books, and a few weeks later we were billed for royalties on all the trade.... at HIS estimate of the GROSS VALUE. My boss/the owner was based in New York. He arranged to set down with the licensing people, they bargained like someone in a middle eastern city market, and I got a phone call to submit a check for a small, small percentage of the original demand.

Unless you have something complicated in how you do business and bill your revenue, I am hard pressed to understand how you can be in a position where two parties cannot multiply SALES TIME RATE and each party understand the transaction.

If you haven't already done this, get with the managers of ten radio stations that you consider to be comparable to yours. Ask them to share their formula with you. Do different stations have different rates. I thought they used to be the same. If all ten of your friends are paying an identical rate, then take that rate and calculate what your payment should be. If everybody is paying a different rate, we have a problem, Houston.

P.S. After the audit at the station I was running a number of years ago, I asked the owner if we should start calculating INCLUDING the trade-outs going forward. Response: Of course not! We will keep the money and use it for now. Five years from now they come back and audit us again, we will go wrestle over the values again and write them a small check.... again. One of my early lessons how the business world sometimes operates.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

You might be able to find help from the New York State Bar Association's Lawyer Referral Service, as long as you know what kind of an attorney you need for the service you require. My guess is that you need a communications attorney who is proficient in contract law, copyright law, trademarks/service marks, along those lines. Might be a tiny bit pricey.

http://www.nysba.org/Content/NavigationMenu/PublicResources/NeedaLawyer/Hire_an_Attorney.htm
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

No, an attorney who handles general business law, perhaps with the assistance of a CPA. (Or an attorney/CPA, though these folks usually practice tax law.)

The core issue is not one of copyright/trademark--that's an entirely differently field.
The core issue here is one of contract interpretation.

Again, find one of the bigger firms in your nearby big city, and ask for someone who specializes in commercial law.

---Ohio attorney
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Contract law was my first option too. I consider everything though.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Used to be a percentage of gross revenues. Several years ago, the Radio Music License Committee won a court case, negotiates with BMI and ASCAP on behalf of broadcasters, and the rate is no longer based on revenues. There are formulas for determining station rates, based on revenues and ratings back in 2004. This past year, RMLC negotiated further reductions. New stations pay a nominal fee.

My first course of action would be to contact the RMLC. It's a non-profit, and will be happy to explain how the rates are derived for a particular station.

SESAC, on the other hand, is not part of the court's jurisdiction, and remains ready and willing to extract whatever they can, whenever they can, so you can play their small number of licensed songs. SESAC has a convoluted formula based on "highest spot rate" and "population count in county". Doesn't matter that you never get the highest spot rate, or that your station only covers a portion of the county, although those two things are negotiating tools.
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Thanks for the good information everyone. I've been out ill, so I'm not sure what they've done at the office the last couple of days, but I know they'll engage someone who can argue in Federal Court.

BW, we definitely went to the Radio Music Licensing Committee (RMLC) early on... they say that BMI definitely should not have ramped up our rate (i.e., that they did not submit any changes in our formula to BMI), but they are indicating that they cannot do anything about inflated amount or the bullying/threat that we'll have to come to NY to arbitrate if we don't just pay up.

I heard someone at the office joking that someone could get rich coming up w/ a "SESAC-FREE" format... now I know what is meant by that.

I think in this case that BMI is being aggressive like SESAC (i.e., refusing to tell us how they've come up with the inflated number they're invoicing for recent months). And we're incredulous that RMLC is being so hands-off and saying they're "sorry about our disagreement, but we'll have to work it out with BMI."
 
Re: Know of attorney or consultant who helps stations w/ arbitration w/ BMI & ASCAP

Wait until they start telling you to go to the newspapers, and then that if you can get about 100 people together maybe you can get a class action suit started.

It's called laziness.
 
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