(CN) – More than 1,000 local TV stations throughout the country demand determination of a reasonable fee Broadcast Music Inc. may charge to license songs the stations use in TV shows. The 1,200 stations say they have tried unsuccessfully to negotiate new rates since their agreement with BMI expired in 2004, and that the advent of cable TV and reduced advertising during the recession have hurt them, so the old rates are no longer fair.
Since the last agreement with BMI expired in 2004, lead plaintiff WPIX says, the stations have continued to pay fees according to the expired agreement.
But the fees are no longer fair because “the economic health of the local television industry has deteriorated profoundly” since 2004, WPIX claims in Manhattan Federal Court.
Between 1999 and 2004, the stations paid a portion of BMI’s industrywide blanket licensing fee of $484 million.
The Television Music Licensing Committee, a TV industry group, divided the fees among the stations. BMI offered an alternative per-program licensing plan, but the stations say that amount is still too high.
The stations say the fees are unreasonably expensive because they have suffered a “massive reduction” in viewership since 2004.
With more viewers switching to cable channels and “various other media” for entertainment, the stations say the value of BMI’s catalogue has also declined.
Fewer viewers hear the songs, but the stations still pay the same license fees to use them.
The decline in viewership also hurt the stations’ advertising revenue, the complaint states. The stations say they have had to tighten their belts, but still have to pay the same amount for Broadcast Music’s songs.
The petition does not cover BMI’s agreements with ABC, NBC, CBS, Lifetime or Univision.
The stations want the court to determine a reasonable blanket fee to apply retroactively from 2005 until 2014. They want the agreement to include credits for songs the stations license directly from artists or through the creators of the shows they broadcast. The stations also demand access to BMI’s licensing records for other local TV stations.WPIX and the other stations are represented by R. Bruce Rich, Benjamin Marks and Jason Lichter with Weil Gotshal & Manges