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Are some of the most famous musicians on the globe actively participating in an antitrust conspiracy that could finish off the radio business? That might sound hyperbolic, but it’s exactly what attorneys at the prestigious law firm of Latham & Watkins told a California federal court on Thursday.
The firm is representing the Radio Music License Committee, whose membership includes some 10,000 radio stations throughout the nation. These stations are fighting off licensing demands from Global Music Rights LLC, the performance rights collective founded by Irving Azoff.
For the last few years, RMLC and GMR have been locked in an antitrust battle, and while the case has slowed due to the COVID-19 pandemic, the litigation is again heating up over discovery demands.
RMLC has already served document demands on the likes of Bruce Springsteen, Yoko Ono, Pharrell Williams and other clients of GMR, which hopes to win higher license fees because Azoff’s outfit isn’t beholden to the consent decrees that require larger competitors BMI and ASCAP to offer blanket licenses to music users. (GMR is currently in court against radio stations, but television broadcasters could be next.)
Now RMLC wants depositions too — specifically for five music luminaries. They are Jon Bon Jovi, Don Henley, Shane McAnally, OneRepublic frontman Ryan Tedder, and Ron Laffitte (the manager of Pharrell Williams).
The radio group asserts that these individuals are more than “nonparties” in the case. The group sees these five as part of a “hub-and-spoke conspiracy,” arguing, “Testimony from alleged co-conspirators themselves is, perhaps, the most important evidence of conspiracy that can exist.”
Jon Bon Jovi, Henley, McNally, and Tedder appear to have an equity interest in GMR, although GMR’s attorney tells the judge that these equity interests consist of non-voting shares which grant the musicians a right to receive a portion of the proceeds if there is a liquidity event involving GMR.
RMLC has also been interested in how GMR supposedly helped secure loans for 21 individuals including Drake, Jared Leto, Bruno Mars, Travis Scott, and Lars Ulrich in as part of a compensation package for the assignment of the affiliates’ public performance rights.
But allegedly, the “conspiracy” goes beyond financial participation.
The radio station group says it has documents in its possession that showcase “conversations” between the music stars before they joined up with GMR. In fact, the federal judge is told over several pages of sealed material about “textbook examples… support[ing] an inference of conspiracy” involving Bon Jovi, Henley, McNally, Tedder, and Laffitte. Much of the materials may be targeted towards how these individuals “recruited other” songwriters so that GMR would have “critical mass” and “succeed in raising prices.”
“[T]he Co-Conspirator Affiliates argue that they are too rich and famous to be deposed, and RMLC is clearly only doing this to harass them,” states the radio group’s attorneys including Latham & Watkins partner Jennifer Giordano. “Neither is true. The law does not excuse rich and famous people from being deposed when, as here, they have relevant and unique evidence.”
RMLC’s attorneys add, “If the Co-Conspirator Affiliates can take the time to build the GMR cartel for the explicit purpose of raising prices and making it ‘game over’ for radio stations, surely they can sit for a deposition to answer questions about their role.”
GMR, whose legal team is led by O’Melveny partner Daniel Petrocelli, responds that the five are not key witnesses and the documents are a far cry from any “smoking gun.”
It’s added, “The inability of RMLC to point to a single document presenting viable evidence of collusion from any of these five deposition targets underscores the impropriety of its deposition requests and RMLC’s shirk of its discovery obligations to not burden nonparties with discovery most appropriately sought from more convenient and logical sources.”
U.S. District Court Judge Terry Hatter will hear this matter on June 3, and if he allows the depositions, four of the five individuals (all but Laffitte) have already provided dates of availability in the next few months. Discovery is set to close in September with a pre-trial conference targeted for next February.
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