Publishers Sue Music Provider to Yahoo, HMV, Samsung, Others

Several members of National Music Publishers' Association (NMPA) have sued MediaNet, a white-label digital music service that provides the back end for Yahoo Music Unlimited, HMV Digital, Samsung Media Studio, iMesh, Music Gremlin, and other companies, for distributing music to those companies illegally.

The company was previously known as MusicNet, back when it was owned in part by three of the then-five major labels: EMI, BMG, and AOL Time Warner.

The plaintiffs, including Sony/ATV Songs, Peer International, Frank Music Corporation and MPL Publishing, allege that MusicNet lacks a valid agreement with publishers to distribute the music it has been distributing to Yahoo and others, because it failed to reach an agreement with the Harry Fox Agency, which collects on behalf of publishers, when the original stakeholders sold off the company to private equity firm Baker Capital in 2005.

The NMPA explains that its move is related to the Digital Media Association's attempt to get the Copyright Royalty Board to set publishers' royalties for interactive streams at zero:

Despiterepeated warnings from music publishers that it is not properlylicensed, MediaNet continues to operate its unauthorized music servicedirectly and as a white-label provider to third parties who offer it totheir own customers.

The filing [initiating the publishers' lawsuit] comes as the CRB is in the midst of hearings to determinemechanical royalty rates for the use of musical works, including bystreaming music services such as MediaNet. MediaNet and other digitalcompanies are represented in the proceeding through their tradeorganization, the Digital Media Association (DiMA).

"DiMA members reaped the benefits of rateless deals for seven years,
but now they have taken the position in the current CRB proceeding thatmusic publishers and songwriters are not entitled to royalties forinteractive streams," [NMPA head David] Israelite said.