APPENDIX 3.-LETTER FROM MARVIN L. BERENSON, SENIOR VICE PRESIDENT AND GENERAL COUNSEL, BROADCAST MUSIC, INC. (WITH ATTACHMENTS), TO HON. WILLIAM J. HUGHES, CHAIRMAN, SUBCOMMITTEE ON INTELLECTUAL PROPERTY AND ADMINISTRATION, APRIL 1, 1994 BMI JUDICIAL Mervin L. Berenson Server Vice President April 1, 1994 Honorable William J. Hughes, Chairman 207 Cannon House Office Building Dear Chairman Hughes' Public Accommodations Act of 1993 -HR 3288 In follow up to your hearings, I am enclosing BMI's responses and materials relating to questions raised and issues discussed relating to performing rights licensing. I would be pleased to answer questions which you have and would be happy to meet with you and your staff. Enclosures Imarings.41 very truly yours, Marvin Berenson 320 West 57th Street, New York, NY 10019-3790 (212) 830-2533 Fax: (212) 397-0789 Telex: 127823 Comments of Broadcast Music, Inc. Performing Rights Organizations Before INTRODUCTION In February 1994, Chairman Hughes' conducted two days of oversight hearings concerning the music licensing practices of the performing rights organizations, BMI, ASCAP and SESAC. At those hearings, a number of music users representing various industries submitted written statements and testified. In this submission, BMI responds to the testimony of ASAE, the American Choral Directors Association, Messrs. Swinburn and Mayer on behalf of public assembly facilities, Guy Gregg, owner of The Publick House restaurant, the National Licensed Beverage Association, and various radio broadcasters. AMERICAN SOCIETY OF ASSOCIATION EXECUTIVES Broadcast Music, Inc. (BMI) offers the following responses to the claims made by the American Society of Association Executives (ASAE) in its Testimony of February 1994.1 24, ASAE and its Membership ASAE points out the size of its membership – 22,000 members serving 10,000 voluntary associations, and emphasizes the educational nature of its activities. BMI certainly has no disagreement with ASAE's description. We would only note that ASAE's emphasis on its educational activities has no bearing on its members' obligations to comply with the provisions of the Copyright Law. While there is an exemption for certain types of educational activities in the Copyright Act, that exemption does not bear upon the activities discussed by ASAE. ASAE's posture that its activities should require copyright holders to donate their creations because of ASAE'S educational activities is totally unwarranted. There is no more reason for musical works to be donated to ASAE and its members than for copy machines, telephone service or convention centers to be donated to ASAE and its members. 'Headings and page references refer to the headings and page references of ASAE in its written testimony. ASAE and Music Licensing In its recitation of the history of licensing of the public performance of music by associations, ASAE states that it was assumed that the performing rights organizations chose to ignore the association community because of minimal and sporadic use of copyrighted music by associations, which exist primarily to provide provide education, and that music licensing was taken care of by hotels, convention centers, and conference centers. its BMI did not "ignore" the association community in licensing efforts prior to the 1990 industry-wide agreement. However, a multitude of innovations and improvements in sound and stereo technology took place in the 1980's, which are of course continuing today. These innovations and improvements have facilitated the use of music as an effective marketing tool for businesses, and the meetings, conventions and associations industries have, we believe, been at the forefront of this expansion. While BMI had some licenses for associations and other presenters of similar events in place, and had introduced an agreement 21 specially designed for Trade Shows/Conventions in 1989, in 1990 BMI participated in negotiations with a Task Force composed of four major associations: Meeting Planners (MPI), American Society of Association (ASAE), Professional Convention Management International Executives Association (PCMA), and the Religious Conference Management Association (RCMA). At that time, and with the endorsement of all of the associations, BMI gave a higher priority to the licensing of those areas. ASCAP and BMI Practices ASAE states that the practices of ASCAP and BMI have been the subject of hundreds of complaints to ASAE. Testimony, p.3. ASAE's statement is misleading. When ASAE has made similar claims in the past, each and every time BMI has asked for the specifics of the claims so that the claims could be addressed. When ASAE did provide BMI with some specifics, we found that either the claims were incorrect or a response was merited. Attached hereto as Exhibit 1 is the letter to which ASAE refers at page 9 of its testimony and BMI's response thereto which provides more detail about our responses to complaints. As stated in our February 27, 1992 letter, we have not received complaints from ASAE since January 22, 1991. As BMI stated in its testimony at the February 24, 1994 hearings, BMI has attended many meetings and conferences of the associations which negotiated for the license agreement currently in use including many ASAE meetings. There have been complaints at our best to respond to them. of complaints which have publications of the associations, but those complaints, just like the claims made in ASAE's testimony, have been without these meetings and we have done There have also been a number appeared in various trade |