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VerStandig Sells Station at Center of SoundExchange Suit

Owner says sale won’t end pursuit of geo-fencing technology

Just because VerStandig Broadcasting is selling the radio station at the center of a lawsuit filed by the company against SoundExchange, it doesn’t necessarily signal the end of streaming royalty case, the company’s owner says.

VerStandig’s declaratory judgment action in 2014 against SoundExchange, the entity responsible for collecting music recording royalties and distributing them to copyright owners, cited a 150-mile royalty exemption set down by the U.S. Copyright Office for streaming their on-air signals.

The broadcaster wanted to use a streaming technology known as geo-fencing to allow it to cap the online retransmission of its broadcast programming on WTGD(FM) in Harrisonburg, Va., to within 150 miles of a station’s transmitter and not trigger the sound performance royalty fees.

However, a judge dismissed the suit without prejudice in February. Judge Michael Urbanski’s decision called the plaintiff’s allegations “too speculative, indefinite and hypothetical” to allow the suit to go forward.

VerStandig announced in April it was selling WTGD and four other radio stations to Saga Communications. The sale, still pending FCC approval, is expected to close in June, according to Saga.

“You should expect the geo-fencing issue to arise again, albeit in a different arena with a different judge,” VerStandig Broadcasting President John VerStandig said in an email to Radio World.

Since the judge dismissed the case without prejudice, it leaves open the possibility VerStandig or another broadcaster could pursue future litigation to decide the question of a 150-mile royalty free streaming zone.

SoundExchange contends the Copyright Office 150-mile exemption only applies to satellite and cable systems and not broadcast streaming via the Internet.

SoundExchange Wins Dismissal of VerStandig Suit

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