Radio Music License Committee v. American Society of Composers

Background

Radio Music License Committee, Inc. (RMLC) brought this action seeking a determination of reasonable license fees and terms for licenses from Broadcast Music, Inc. (BMI) for the period from January 1, 2022, through December 31, 2026. BMI served discovery requests seeking licensing agreements, negotiations, fee information, and related materials involving RMLC, radio stations, and other performing-rights organizations.

BMI also subpoenaed nonparty Global Music Rights, LLC (GMR), seeking similar information, including GMR’s licenses and agreements with radio stations and radio groups, fees paid to GMR, studies concerning the value of GMR’s musical repertoire, and nonprivileged settlement materials. GMR produced some materials but opposed further disclosure of its confidential information. RMLC later identified additional GMR-related materials that it intended to produce to BMI under the existing protective order.

The existing protective order allowed documents containing highly sensitive confidential or proprietary information to be designated “OUTSIDE COUNSEL ONLY.” It also restricted one RMLC attorney from accessing certain non-RMLC BMI license agreements and related negotiation materials.

GMR’s Motion to Intervene

GMR moved under Federal Rule of Civil Procedure 24 to intervene. Intervention allows a nonparty to participate in a case for a limited purpose when its legally protected interests may be affected. BMI did not oppose GMR’s intervention for the limited purpose of seeking protection for the requested discovery.

The court found that GMR met the requirements for intervention as of right under Rule 24(a)(2), based on its interest in keeping its confidential commercial information from being disclosed. The court therefore granted in part and denied in part GMR’s motion to intervene. GMR was permitted to intervene only to protect the confidentiality of the requested discovery, and the case caption remained unchanged.

Protective Order

Under Federal Rule of Civil Procedure 26(c), a court may issue a protective order for good cause to prevent annoyance, embarrassment, oppression, or undue burden or expense. The rule permits protection for trade secrets and other confidential commercial information. The party seeking the order bears the burden of showing good cause.

GMR sought an order completely barring RMLC from producing the requested discovery to BMI. The court found that GMR had not shown good cause for a complete bar. Although the requested discovery was confidential, the court explained that confidential documents are commonly produced subject to protections governing how they may be accessed and used. The court also found that the requested discovery was relevant and proportional to the needs of the case.

The court nevertheless found that GMR had shown good cause for additional protections. GMR represented that the materials contained highly confidential, proprietary information, and BMI’s outside counsel acknowledged that its attorneys sometimes participate in BMI licensing negotiations. The court concluded that GMR and its licensees could suffer competitive harm if BMI’s outside counsel participated in future licensing negotiations while possessing GMR’s confidential information.

Required Production and Restrictions

The court granted in part and denied in part GMR’s motion for a protective order. Materials to which GMR did not object must be produced by RMLC to BMI under the “OUTSIDE COUNSEL ONLY” designation.

Materials to which GMR objected must first be produced only to up to three attorneys at Milbank LLP, BMI’s outside law firm, who file certifications with the court. Each certifying attorney must state that, for three years after the certification, the attorney will not participate in licensing negotiations on BMI’s behalf. RMLC must designate those materials “CERTIFYING MILBANK COUNSEL ONLY.”

BMI may not use documents with that designation, and the certifying attorneys may not disclose them to anyone else, without GMR’s written consent or another court order. The certifying attorneys may represent BMI in litigated proceedings, including rate-court proceedings, but may not participate in BMI licensing negotiations during the three-year period. If BMI seeks to use or disclose the materials, the certifying attorneys must first confer with GMR; if the parties cannot agree, BMI may apply to the court.

Disposition

The court’s conclusion states that GMR’s motions to intervene and for a protective order were “GRANTED IN PART and DENIED IN PART.” GMR was permitted to intervene for the limited purpose of protecting the confidentiality of the requested discovery. The court required the certifying attorneys to file their declarations by September 6, 2024, and required production within seven days after a declaration was filed. Judge Stewart D. Aaron signed the opinion as a United States Magistrate Judge.