SoundExchange, the entity tasked by Congress to collect digital music royalties and distribute payments, is suing Muzak for underpayment.
Canada’s Mood Media acquired Muzak in 2011. SoundExchange alleges that Mood Media is trying to acquire new music services and pay for sound recordings at older, below market rates that were intended for a limited set of companies, (but did not specify exact figures).
Subsequent to its Muzak acquisition, Mood also purchased DMX, which provided music for cable and satellite television networks, including DirecTV.
Previously, DMX had been licensing music under the “regular fair market standard,” according to SoundExchange president/CEO Michael Huppe. However, in 2014 Mood moved DMX’s cable and satellite music service contracts (including DirecTV) to Muzak, and “dramatically” lowered its music royalties.
This is the second such suit filed by SoundExchange, the entity first filed suit against SiriusXM in 2013.
Mood Media has not publicly commented on the case.