October 25, 2019

Be Careful If You Leave A PRO, It Might Cost You

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Songwriters jump from one performance rights organization (PRO) to another all the time, but it usually doesn’t make waves when it happens. That could be because they don’t pay close attention to their royalty statements or they’re not a major earner so they’re not affected. Grammy-winner songwriter/producer Shane McAnally found out the hard way that quitting ASCAP had financial ramifications, to the tune of $204,612.84, and he tried to do something about it.

The songwriter (who’s worked with huge country artists like Kenny Chesney, Keith Urban, Kelli Clarkson, and many more) chose to move from ASCAP to the organization’s for-profit alternative Global Music Rights (GMR) in 2013. ASCAP continued to pay him for another 2 ½ years until the rights were fully transferred to GMR, but decreased the royalty every quarter from 100%, to 75%, to 50%, to 25%, and finally to 0 after that. In other words, McAnally was still earning money, ASCAP was collecting it, but he wasn’t getting paid. It was determined that he was owed $204,612.84.

McAnally then took his case to the ASCAP Review Board, and surprise, it ruled against him, which it previously had done 40 out of 42 times since 1960.

He then took the case to arbitration and the results have been confidential until now.

In the course of the recent Consent Decree review, which sets the rates that ASCAP, BMI and SESAC can charge, the results of the case were made public. The ruling was surprising.

McAnally lost the arbitration case – but not really. The 3 person panel of music law experts making up the arbitration review severely rebuked ASCAP for the way it treated the songwriter, and for making the process confusing for its members.

Then it awarded him exactly $204,612.84 for the costs he incurred bringing the case. So he lost the case but received his money anyway.

Sometimes justice is served, but with a bit of a curveball to it.

This is a fascinating case, and you can read more about it on Music Business Worldwide.


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