Lewis Black is the latest comedian to sue the music streaming service Pandora for copyright infringement. Black is following on the heels of the Robin Williams and George Carlin estates, who sued the platform in February, joined by Andrew Dice Clay, Bill Engvall and Ron White.
All of these suits rely on the same underlying claim, which is that Pandora failed to obtain a license to stream their copyrighted work. Pandora (now owned by SiriusXM) claims that it has no duty to do so.
Streamers pay two royalties for performing music—one for the underlying composition and one for the sound recording. Each of these is subject to a separate copyright. Rather than negotiate a separate license for each work they perform, streaming services, like radio before them, pay a blanket license fee to a middleman organization, which is in turn responsible for tracking what is played and allocating the blanket license fees to its members according to popularity. For compositions, these are the performing rights organizations (PROs) such as ASCAP, BMI and SESAC. For streaming rights in sound recordings, it’s Sound Exchange. When it comes to comedy recordings, however, Pandora pays only for rights in the sound recording and not for the comedy routine that it embodies.
The reasons for this distinction are structural. For comedy recordings, Sound Exchange pays royalties to the same record companies it’s already paying for music recordings. The PROs, however, were formed in the 1930s to collect public performance royalties for songwriters, composers and publishers; their membership does not include comedians. Until very recently, no comparable organization existed for spoken-word artists, so there was no practical way for comics to license their public performance rights. While this has changed with the formation of spoken-word PROs such as Spoken Giants and Word Collections, the streamers are continuing to resist. Pandora filed a counterclaim in the earlier lawsuit tarring Word Collections as a “cartel” seeking to fix prices and stifle competition.
For his part, Black asserts that Pandora’s hands are hardly clean. In SEC filings from 2011 to 2017, Pandora acknowledged the risks of streaming unlicensed comedy content, stating that it “could be subject to significant liability for copyright infringement and may no longer be able to operate under [its] existing licensing regime.” Pandora dropped this warning after it was acquired by Sirius XM.
Jeff Price, the CEO of Word Collections has his own take on the situation. “They shoot first and aim second—that’s the way tech companies work. They get caught and they pay the parking ticket. They use their money to make it difficult and expensive for comedians to get paid.”