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Celebrity Music Publishers Accused of Conspiring to Restrain Trade

Celebrity Music Publishers Accused of Conspiring to Restrain Trade

By Friday, 10 May 2019 12:35 PM Current | Bio | Archive

Peloton has wrongfully been cast in a negative light by the National Music Publishers Association, Inc. (“NMPA”), according to the fitness company, which filed a countersuit on April 30 against music publishers for Drake, Rihanna, Lady Gaga, Justin Timberlake and many other popular artists.

“Peloton is not the bad actor that Plaintiffs portray it to be,” said Peloton counsel Kenneth L. Steinthal.

Downtown Music Publishers LLC v Peloton Interactive, Inc., filed in the Southern District of New York on March 19, alleges that Peloton had not obtained synchronization licenses for more than 1,000 songs used in Peloton’s fitness videos displaying on treadmills and stationary bikes.

“There is no doubt that Peloton’s infringement was and continues to be knowing and reckless,” wrote the music publisher’s attorney Jay Cohen in his March 19 complaint.

“Those copyright violations continue as Peloton creates new workout videos containing works owned or administered by Plaintiffs.”

The music publisher plaintiffs, now named defendants, include Downtown Music Publishing, Ole Media Management, Big Deal Music, Cypmp, Peer International Corp., Peertunes and Reservoir Media Management.

The NMPA, whose CEO and President is David Israelite, slams the fitness company for undervaluing its relationship with the music industry and for hostility towards artists without which it could not have found success.

Peloton’s reported value is in excess of $4 billion and the music publisher’s demand for a payout of $150 million for copyright infringement comes at a time when Peloton may go public.

“Peloton’s countersuit has no merit and is an attempt to divert attention from the fact that it has been operating without sufficient licenses for years in order to build its multibillion dollar business,” NMPA Executive Vice President Danielle Aguirre told Newsmax Finance.

“The NMPA routinely defends the interests of its members’ copyrights in order to protect their value, prevent future infringement and to seek damages to which they are entitled under the law when their property has been stolen.”

Mr. Steinthal’s counter lawsuit claims that Peloton tried to pursue direct negotiations with a number of music publishers but that after participating in seemingly meaningful negotiations, several of the music publishers cut off their negotiations and collectively declined to negotiate.

“NMPA was the ringleader in the filing of the Complaint,” wrote Mr. Steinthal about the lawsuit filed against Peloton in March. “NMPA issued a press release touting the filing on the day the Complaint was filed and [Mr.] Israelite appeared on CNBC that same afternoon.”

Further, the Peloton counterclaim alleges anticompetitive acts on the part of the NMPA and music publishers that were intentionally directed at the United States and involved a conspiracy to restrain trade in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1.

“Peloton has great respect for songwriters and artists,” said Peloton CEO and Founder John Foley in a statement released online. “We have partnered with each of the major music publishers, record labels and performing right organizations, and many leading independents. We have also invested heavily to build a best-in-breed reporting and licensing system to support our partners and provide our Members with a world-class fitness experience.”

Peloton members subscribe for some $40 a month to use fitness videos from home.

While Peloton is requesting relief that includes disgorgement of profits and enjoining from further collective negotiating with music users and interfering in music publishers’ negotiations, the NMPA vows to continue to fight for the rights of music creators.

Juliette Fairley is an author, lecturer and TV host based in New York.

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Celebrity Music Publishers Accused of Conspiring to Restrain Trade
celebrity, music, publishers, trade
Friday, 10 May 2019 12:35 PM
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