Radio Music License Comm., Inc. v. Am. Soc'y of Composers

684 F.Supp.3d 165

RADIO MUSIC LICENSE COMMITTEE, INC., Petitioner, v. AMERICAN SOCIETY OF COMPOSERS, AUTHORS AND PUBLISHERS, et al., Respondents.

22 Civ. 5023 (JPC)

United States District Court, S.D. New York

Signed July 27, 2023

Ethan Price Davis, Kenneth L. Steinthal, King & Spalding LLP, San Francisco, CA, for Petitioner.

Scott Alexander Edelman, Milbank LLP, New York City, NY, Andrew Leighton Porter, Atara Miller, Milbank LLP, New York, NY, for Respondent Broadcast Music, Inc.

ORDER

JOHN P. CRONAN, United States District Judge:

Petitioner Radio Music License Committee, Inc. ("RMLC")¹ initiated this action on June 15, 2022 by filing a petition for the determination of reasonable final license fees under two consent decrees, one entered against each of the Respondents, American Society of Composers, Authors, and Publishers ("ASCAP") and Broadcast Music, Inc. ("BMI"), two performing rights organizations. BMI's consent decree was entered in United States v. Broadcast Music, Inc., No. 64 Civ. 3787 (LLS) (S.D.N.Y.), a case currently before the Honorable Louis L. Stanton. Pursuant to 28 U.S.C. § 137(b)(1)(B), "any application for the determination of a license fee for the public performance of music in accordance with the applicable consent decree shall be made in the district court with jurisdiction over that consent decree" and randomly assigned to a judge other than the judge with jurisdiction over the consent decree or a judge to whom another proceeding for the determination of a reasonable license fee is assigned. Under this provision, this case was randomly assigned to the undersigned upon initiation.

On July 8, 2022, BMI notified the Court that it had moved for a construction of its consent decree before Judge Stanton on that same day. Dkt. 24. BMI sought a determination from Judge Stanton that its consent decree prohibited a petition for the determination of reasonable license fees from proceeding in the same action against both it and another entity, i.e., ASCAP. See Dkt. 25-1 at 1. As a consequence of BMI's application for construction of its consent decree, this Court stayed this case on July 19, 2022 pending a final resolution of that application pursuant to 28 U.S.C. § 137(b)(2). Dkt. 31; see 28 U.S.C. § 137(b)(2) ("If any such application is made in connection with a rate proceeding, such rate proceeding shall be stayed until the final determination of the construction application.").

In a Memorandum Opinion and Order dated May 26, 2023, Dkt. 34, Judge Stanton determined that ASCAP should be severed from this action, with those portions of RMLC's Petition related to ASCAP assigned to another judge in this District. See United States v. Broad. Music, Inc., No. 64 Civ. 3787 (LLS), 2023 WL 3788859, at *1 (S.D.N.Y. May 26, 2023).² Following that determination, RMLC moved to continue the stay of this action, advising that it had appealed Judge Stanton's decision and taking the position that the mandatory stay under 28 U.S.C. § 137(b)(2) continued until the resolution of that appeal. Dkt. 36. BMI opposed the motion, arguing that Judge Stanton's decision constituted "the final determination of the construction application" for purposes of subsection 137(b)(2), and that therefore the stay should be lifted. Dkt. 37 at 2. On June 7, 2023, the Court ordered additional briefing on this issue. Dkt. 38. RMLC filed a supplemental brief on June 15, 2023, Dkt. 39 ("RMLC Brief"), and BMI provided its own on June 22, 2023, Dkt. 40 ("BMI Brief").

Resolution of this dispute requires the Court to interpret the phrase, "the final determination of the construction application," in 28 U.S.C. § 137(b)(2) and, in particular, resolve whether a "final determination of the construction application" includes any appeal of the district court's construction. This appears to be an issue of first impression in any court.

The Court begins with the statute itself. At the onset, the Court notes that 28 U.S.C. § 137 is titled "Division of business among district judges." Turning to the statutory text, subsection (b)(1)(B) then makes the first reference to an "application" for construction of a consent decree. That subsection states that "any application for the determination of a license fee for the public performance of music in accordance with the applicable consent decree shall be made in the district court with jurisdiction over that consent decree and randomly assigned to a judge of that district court according to the rules of that court for the division of business among district judges, provided that any such application shall not be assigned to" (i) the judge with jurisdiction over the consent decree or "(ii) a judge to whom another proceeding concerning an application for the determination of a reasonable license fee is assigned at the time of the filing of the application." 28 U.S.C. § 137(b)(1)(B). Subsection 137(b)(2) further states that nothing in the prior subsection "shall modify the rights of any party to a consent decree . . . to make an application for the construction of any provision of the applicable consent decree. Such application shall be referred to the judge to whom continuing jurisdiction over the applicable consent decree is currently assigned." Id. § 137(b)(2).

Thus, in each instance the term "application" for consent decree construction is employed in the statutory text, other than the instance immediately at issue, it unquestionably refers to an application before a district court or a specific district court judge. Id. § 137(b)(1)(B) ("any application . . . shall be made in the district court" "provided that such application shall not be assigned to . . . a judge to whom another proceeding concerning an application for the determination of a reasonable license fee is assigned at the time of the filing of the application"); id. § 137(b)(2) ("Such application shall be referred to the judge to whom continuing jurisdiction over the applicable consent decree is currently assigned."). And indeed, the provision at issue immediately follows the latter mention that the consent decree application shall be referred to the judge with continuing jurisdiction over the consent decree—a clear reference to a district judge—and even repeats the preceding sentence's use of "such application." Id. Considering the text as a whole, this suggests that the "construction application" referred to in "the final determination of the construction application" also refers to a construction application before the district court.

RMLC resists this reading of subsection 137(b)(2), pointing largely on the presence of the word, "final." RMLC Brief at 3-6. RMLC argues that the term "final determination" must refer to a decision of an appellate court because "final" means "marking the last stage of a process; leaving nothing to be looked for or expected; ultimate," id. at 4 (internal quotation marks and brackets omitted), and that it is the decision of an appellate court which will be the last decision on a matter of consent decree construction. RMLC further argues that "determination" means "a judicial decision settling and ending a controversy." Id. (internal quotation marks omitted). Therefore, RMLC reasons, the district court's decision in a construction application is already a "determination," which would render the word "final" superfluous if it referred solely to the district court's decision. Id.

The strength of RMLC's arguments largely turns on the availability of immediate appellate review of a district court's decision on the construction application when that decision does not otherwise resolve the merits of the litigation—i.e., the related fee petition, as would be the case here. If appellate review is unavailable, then no decision other than the district court's decision could be the "final determination" of the construction application.³ In 2018, section 104 of the Music Modernization Act amended 28 U.S.C. § 137 to add subsection (b)(2). See Pub. Law 115-264 Title I, § 104 (2018). Prior to that amendment, applications for construction of a consent decree proceeded before the judge who presided over the rate case in which the construction was needed. See, e.g., WPIX, Inc. v. Broad. Music, Inc., No. 09 Civ. 10366 (LLS), 2011 WL 1630996 (S.D.N.Y. Apr. 28, 2011); see also, generally, WPIX, Inc. v. Broad. Music, Inc., No. 09 Civ. 10366, 2011 WL 1630996 (LLS) (S.D.N.Y. 2011). In this District, such rate cases were generally assigned as related to the judge with jurisdiction over the case in which the relevant consent decree was entered. See Text Entry, WPIX, Inc., No. 09 Civ. 10366 (LLS) (S.D.N.Y. Dec. 21, 2009). Back then, a decision on a construction application was not an appealable final decision of the district court merely because it decided a construction application. See Mandate, WPIX, Inc., No. 09 Civ. 10366 (LLS) (S.D.N.Y. Jan. 20, 2012), Dkt. 56 ("Upon due consideration, it is hereby ORDERED that the motion [for dismissal of the appellant's interlocutory appeal] is GRANTED because this Court [i.e., the Second Circuit] lacks jurisdiction to adjudicate the appeal.").

Nothing in the text of 28 U.S.C. § 137 indicates that the 2018 amendments were meant to alter this analysis. The provisions merely alter which particular judge in a district resolves a rate petition, while ensuring that centralized interpretation of a given consent decree remains with the judge having jurisdiction over that consent decree and that any rate case in connection with a construction application is stayed pending the other judge's construction. In other words, 28 U.S.C. § 137(b)(1)(B) changes which judge would resolve a construction application, but says nothing to indicate that the effect of that resolution would be altered such that a previously non-appealable decision now is appealable. This suggests that it is the final decision of the district judge presiding over the construction decree on the construction application that constitutes the ...