Major Labels Appeal to Keep Mechanical Royalty Rate at 9.1 Cents

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Major Labels Appeal to Keep Mechanical Royalty Rate at 9.1 Cents
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The RIAA and the three major record labels have filed a motion with the Copyright Royalty Board asking to limit the scope of a recent ruling to reconsider the long-standing 9.1 cent mechanical royalty rate on physical and download format sales.

the intent for the filing is to take care of a procedural matter. By buying more time, it will allow participants to engage in settlement talks and avoid millions of dollars in litigation. Otherwise, participants would have less than three weeks to prepare to litigate a rate proceeding or come up with a settlement.

Despite Glazier’s explanation, the filing nevertheless states that the RIAA and the major labels are arguing that the CRB confirm that 9.1 song rate settlement for the subpart B configurations — vinyl, CDs, downloads and other physical music formats — is still in effect for everyone else—all labels, all publishers and all songwriters. According to the RIAA filing, all other songwriters forfeited their right to have a say in CRB rate decisions when “they chose to sit out” the proceedings.

The 9.1 cent mechanical royalty rate has been in effect since 2006, despite the fact that cost of living in the U.S. has increased 31.9% since 2006 in the U.S., according to the references the CRB judges made in its March 30 ruling that threw out the settlement. If the rate holds, it would remain until 2027 under the Phonorecords IV rate proceeding, meaning songwriters would not receive a pay increase on sales in over two decades.

As part of the RIAA’s motion, the filing asked the CRB judges to removed its April 22 deadline for filing rebuttals and instead provide for 60 days from the March 30, 2020 withdrawal of the CRB filing. Moreover, the very act of including a request in the motion for clarification on whether the ruling should apply to everybody or just Johnson also by itself plays into the bid for more time, other sources say.

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